[Federal Register Volume 86, Number 90 (Wednesday, May 12, 2021)]
[Proposed Rules]
[Pages 25980-25992]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-08758]


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 DEPARTMENT OF TRANSPORTATION

National Highway Traffic Safety Administration

49 CFR Parts 531 and 533

[Docket No. NHTSA-2021-0030]
RIN 2127-AM33


Corporate Average Fuel Economy (CAFE) Preemption

AGENCY: National Highway Traffic Safety Administration (NHTSA), 
Department of Transportation (DOT).

ACTION: Notice of proposed rulemaking.

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SUMMARY: This document proposes to repeal ``The Safer Affordable Fuel-
Efficient (SAFE) Vehicles Rule Part One: One National Program,'' 
published Sept. 27, 2019 (SAFE I Rule), in which NHTSA codified 
regulatory text and made additional pronouncements regarding the 
preemption of state and local laws related to fuel economy standards. 
Specifically, this document proposes to fully repeal the regulatory 
text and appendices promulgated in the SAFE I Rule. In addition, this 
document proposes to repeal and withdraw the interpretative statements 
made by the Agency in the SAFE I Rule preamble, including those 
regarding the preemption of particular state Greenhouse Gas (GHG) 
Emissions standards or Zero Emissions Vehicle (ZEV) mandates. As such, 
this document proposes to establish a clean slate with respect to 
NHTSA's regulations and interpretations concerning preemption under the 
Energy Policy and Conservation Act (EPCA).

DATES: Comments must be received by June 11, 2021.

ADDRESSES: You may submit comments to the docket number identified in 
the heading of this document by any of the following methods:
     Federal eRulemaking Portal: Go to http://www.regulations.gov. Follow the online instructions for submitting 
comments.
     Mail: Docket Management Facility, M-30, U.S. Department of 
Transportation, West Building, Ground Floor, Room W12-140, 1200 New 
Jersey Avenue SE, Washington, DC 20590.
     Hand Delivery or Courier: U.S. Department of 
Transportation, West Building, Ground Floor, Room W12-140, 1200 New 
Jersey Avenue SE, Washington, DC, between 9 a.m. and 5 p.m. Eastern 
time, Monday through Friday, except Federal holidays.
     Fax: 202-493-2251.

FOR FURTHER INFORMATION CONTACT: Hunter B. Oliver, Office of Chief 
Counsel, NHTSA, telephone (202) 366-5263, facsimile (202) 366-3820, 
1200 New Jersey Ave., SE. Washington, DC 20590.

SUPPLEMENTARY INFORMATION:

Table of Contents

A. Public Participation
B. Executive Summary
C. Statutory and Regulatory Background
D. Reconsideration Authority
E. Proposed Repeal of Regulations in the SAFE I Rule
F. Proposed Repeal of Preemption Interpretations in the SAFE I Rule
G. Repealing the Regulations and Positions Announced in the SAFE I 
Rulemaking Remains Appropriate Even if NHTSA Possessed the Authority 
for the Rulemaking
    H. Rulemaking Analyses and Notices
    1. Executive Order 12866, Executive Order 13563, and DOT 
Regulatory Policies and Procedures
    2. Regulatory Flexibility Act
    3. Executive Order 13132 (Federalism)
    4. Unfunded Mandates Reform Act of 1995
    5. National Environmental Policy Act
    6. Executive Order 12988 (Civil Justice Reform)
    7. Paperwork Reduction Act
    8. Privacy Act

A. Public Participation

    NHTSA requests comment on all aspects of this proposed rule. This 
section describes how you can participate in this process.

(1) How do I prepare and submit comments?

    Your comments must be written. To ensure that your comments are 
correctly filed in the docket, please include the docket number NHTSA-
2021-0030 in your comments. If you are submitting comments 
electronically as a PDF (Adobe) file, we ask that the documents 
submitted be scanned using the Optical Character Recognition (OCR) 
process, thus allowing NHTSA to search and copy certain portions of 
your submissions.\1\ Please note that pursuant to the Data Quality Act, 
in order for the substantive data to be relied upon and used by NHTSA, 
it must meet the information quality standards set forth in the Office 
of Management and Budget (OMB) and Department of Transportation (DOT) 
Data Quality Act guidelines. Accordingly, we encourage you to consult 
the guidelines in preparing your comments. OMB's guidelines may be 
accessed at https://www.whitehouse.gov/omb/information-

[[Page 25981]]

regulatory-affairs/information-policy/. DOT's guidelines may be 
accessed at https://www.transportation.gov/dot-information-dissemination-quality-guidelines.
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    \1\ OCR is the process of converting an image of text, such as a 
scanned paper document or electronic fax file, into computer-
editable text.
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(2) Tips for Preparing Your Comments

    When submitting comments, please remember to:
     Identify the rulemaking by docket number and other 
identifying information (subject heading, Federal Register date and 
page number).
     Explain why you agree or disagree, suggest alternatives, 
and substitute language for your requested changes.
     Describe any assumptions and provide any technical 
information and/or data that you used.
     If you estimate potential costs or burdens, explain how 
you arrived at your estimate in sufficient detail to allow for it to be 
reproduced.
     Provide specific examples to illustrate your concerns, and 
suggest alternatives.
     Explain your views as clearly as possible, avoiding the 
use of profanity or personal threats.
     Make sure to submit your comments by the comment period 
deadline identified in the DATES section above.

(3) How can I be sure that my comments were received?

    If you submit your comments by mail and wish Docket Management to 
notify you upon its receipt of your comments, enclose a self-addressed, 
stamped postcard in the envelope containing your comments. Upon 
receiving your comments, Docket Management will return the postcard by 
mail.

(4) How do I submit confidential business information?

    If you wish to submit any information under a claim of 
confidentiality, you should submit your complete submission, including 
the information you claim to be confidential business information 
(CBI), to the NHTSA Chief Counsel. When you send a comment containing 
CBI, you should include a cover letter setting forth the information 
specified in our CBI regulation.\2\ In addition, you should submit a 
copy from which you have deleted the claimed CBI to the Docket by one 
of the methods set forth above.
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    \2\ See 49 CFR part 512.
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    To facilitate social distancing due to COVID-19, NHTSA is treating 
electronic submission as an acceptable method for submitting CBI to the 
Agency under 49 CFR part 512. Any CBI submissions sent via email should 
be sent to an attorney in the Office of Chief Counsel at the address 
given above under FOR FURTHER INFORMATION CONTACT. Likewise, for CBI 
submissions via a secure file transfer application, an attorney in the 
Office of Chief Counsel must be set to receive a notification when 
files are submitted and have access to retrieve the submitted files. At 
this time, regulated entities should not send a duplicate hardcopy of 
their electronic CBI submissions to DOT headquarters.
    Please note that these modified submission procedures are only to 
facilitate continued operations while maintaining appropriate social 
distancing due to COVID-19. Regular procedures for part 512 submissions 
will resume upon further notice, when NHTSA and regulated entities 
discontinue operating primarily in telework status.
    If you have any questions about CBI or the procedures for claiming 
CBI, please consult the person identified in the FOR FURTHER 
INFORMATION CONTACT section.

(5) How can I read the comments submitted by other people?

    You may read the materials placed in the docket for this document 
(e.g., the comments submitted in response to this document by other 
interested persons) at any time by going to http://www.regulations.gov. 
Follow the online instructions for accessing the dockets. You may also 
read the materials at the NHTSA Docket Management Facility by going to 
the street addresses given above under ADDRESSES.

B. Executive Summary

    In September 2019, NHTSA and the Environmental Protection Agency 
(EPA) finalized a joint agency action relating to the state regulation 
of GHG emissions from motor vehicles and ZEV mandates. In that action, 
NHTSA codified numbered regulatory text that repeated the existing 
statutory provisions and, in codified appendices, expressly declared 
that certain types of state regulation were preempted due to a 
perceived irreconcilable conflict with the Agency's fuel economy 
standards. In addition, the Agency made further statements throughout 
the rule's preamble that attempted to categorically label existing 
state regulations--particularly those from the State of California--as 
preempted under the codified regulations and associated statutory text. 
As part of the SAFE I action, EPA also revoked a waiver that EPA had 
previously extended to the State of California, under Section 209 of 
the Clean Air Act, to regulate motor vehicle emissions through GHG 
standards and a ZEV mandate.\3\
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    \3\ This proposed rule is being issued only by NHTSA. As such, 
to the extent EPA subsequently undertakes an action to reconsider 
the revocation of California's Section 209 waiver, such action would 
occur through a separate, independent proceeding.
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    The SAFE I Rule represented the first time, in the nearly 50-year 
history of the CAFE program, that NHTSA had adopted regulations 
expressly defining the Agency's views on the scope of preemption of 
state laws that relate to fuel economy. Until 2019, the self-executing 
express preemption provisions in the governing fuel economy statute, 49 
U.S.C. 32919, had always provided the sole codified language on CAFE 
preemption. Since this statutory language is self-executing, Federal 
courts, as well as Federal agencies, states, and local governments,\4\ 
had come to understand the fundamental operation of CAFE preemption and 
applied it on a case-by-case basis, resulting in the development of a 
significant body of case law, without the need for any corresponding 
regulations from NHTSA.
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    \4\ For ease of reference, unless otherwise distinguished 
herein, the varying levels of State regulatory entities encompassed 
by the phrase State or a political subdivision of a State are 
encapsulated in the term ``States'' as used in the remainder of this 
document.
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    Nevertheless, NHTSA finalized the SAFE I Rule in 2019 to prevent 
what the Agency then perceived to be a risk of regulatory uncertainty 
and disharmony resulting from an overlap in state motor vehicle GHG 
emissions regulations and ZEV mandates and NHTSA's fuel economy 
standards. In an effort to foreclose such perceived instability, NHTSA 
promulgated regulations that attempted to preempt ``any law or 
regulation of a State or a political subdivision of a State regulating 
or prohibiting tailpipe carbon dioxide emissions from automobiles,'' 
\5\ including state GHG standards and ZEV mandates. In the SAFE I Rule, 
the Agency described the authority for this sweeping act of preemption 
as primarily drawn from NHTSA's general mandate to establish national 
fuel economy standards, rather than from any particular delegation of 
rulemaking authority in Section 32919.\6\ In the same document, EPA 
withdrew California's then-existing waiver under the Clean

[[Page 25982]]

Air Act, relying, in part, on NHTSA's conclusions that those programs 
were preempted by Section 32919. The final rule was immediately 
challenged in Federal court by numerous stakeholders, including 
California, many of whom argued that NHTSA exceeded its authority in 
promulgating the preemption regulations.\7\
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    \5\ See 49 CFR part 531, app. B (a)(2); 49 CFR part 533, app. B 
(a)(2).
    \6\ See NHTSA, EPA, The Safer Affordable Fuel-Efficient (SAFE) 
Vehicles Rule Part One: One National Program, Final Rule, 84 FR 
51310, 51312 (Sept. 27, 2019) (``To ensure that the fuel economy 
standards NHTSA adopts constitute the uniform national requirements 
that Congress intended, NHTSA must address the extent to which State 
and local laws and regulations are preempted by EPCA.'').
    \7\ See generally Union of Concerned Scientists, et al. v. 
NHTSA, et al., No. 19-1230 (D.C. Cir.) (on February 8, 2021, the 
D.C. Circuit granted the Agencies' motion to hold the case in 
abeyance in light of the reconsideration of the SAFE I action).
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    On January 20, 2021, President Biden signed Executive Order 13990, 
``Protecting Public Health and the Environment and Restoring Science To 
Tackle the Climate Crisis,'' which, among other actions, directed DOT 
and NHTSA to immediately review and consider suspending, revising, or 
rescinding the SAFE I Rule. Accordingly, NHTSA has conducted a 
comprehensive review of the SAFE I Rule and, in particular, the 
legality of and need for the regulations and positions that the Agency 
announced in the SAFE I Rule. As a result of this review, NHTSA now has 
substantial doubts about whether the SAFE I Rule was a proper exercise 
of the Agency's statutory authority with respect to CAFE preemption, 
particularly as to whether NHTSA had authority to define the scope of 
EPCA preemption through legislative rules, carrying the force and 
effect of law. Accordingly, in this document, NHTSA proposes to fully 
repeal and withdraw the codified regulations, as well as any associated 
interpretations or views on EPCA preemption contained in the SAFE I 
Rule, including in the regulatory text of Sec. Sec.  531.7, 533.7, 
appendices B to parts 531 and 533, and the Preambles.
    First, NHTSA has significant concerns that the regulations 
finalized in the SAFE I Rule likely exceeded the Agency's rulemaking 
authority under EPCA. In the final rule, NHTSA codified regulations in 
the Code of Federal Regulations, which attempted to categorically 
prohibit certain state programs by proclaiming them preempted under 
EPCA. However, neither EPCA's express preemption provision nor any 
other statutory source appears to permit NHTSA to adopt legislative 
rules implementing express preemption under EPCA. Although NHTSA's 
administration of EPCA enables the Agency to provide its interpretation 
of EPCA's preemption provisions, NHTSA appears to lack the authority to 
conclusively determine the scope or meaning of the EPCA preemption 
clauses with the force and effect of law. Therefore, NHTSA now has 
substantial doubts about whether the Agency possessed the authority to 
issue binding legislative rules on the issue of EPCA preemption. 
Accordingly, NHTSA proposes to withdraw the regulatory text finalized 
in the SAFE I Rule. This approach realigns NHTSA to its historical 
practice: For the entire history of the program until SAFE I was 
finalized, NHTSA had administered the CAFE program without codifying 
any such preemption regulations.
    In addition, to the extent that the Preambles in the SAFE I Rule 
contained interpretative views that would not be repealed if the Agency 
rescinded the codified text, NHTSA is also proposing to withdraw those 
positions. The Agency believes that withdrawing and repealing these 
statements is appropriate to reaffirm the proper scope of NHTSA's 
preemption authority and to remove the uncertainty created by the SAFE 
I rule. Thus, the Agency proposes to categorically repeal both the 
codified regulatory text and the interpretative views contained in the 
SAFE I rule.\8\ Similarly, to the extent other NHTSA Preambles, which 
preceded the SAFE I Rule, also espoused views directly defining EPCA 
preemption under Section 32919 or the Agency's role in such preemption, 
NHTSA proposes to withdraw and repeal those statements as well.\9\ If 
finalized, the Agency believes that this proposal would restore a clean 
slate for the Agency's position on EPCA preemption, which the Agency 
views as a necessary step to ensure that such prior statements do not 
overstate NHTSA's authority with respect to EPCA preemption issues.
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    \8\ The Agency anticipates that many stakeholders may comment, 
urging the Agency to go further--not merely to repeal the preemption 
determination, but to affirmatively announce a view that State GHG 
and ZEV programs are not preempted under EPCA. Nevertheless, the 
Agency deems any such conclusions as outside the scope of this 
Proposal. When an agency determines that its past action transcends 
the legally permissible scope, the agency is obliged to realign its 
regulatory activities to its properly authorized scope posthaste. 
See, e.g., EME Homer City Generation, L.P. v. E.P.A., 795 F.3d 118, 
134 (D.C. Cir. 2015) (noting the need for a corrective rulemaking 
following a determination that a prior rulemaking exceeded the 
agency's statutory authority). A repeal is the fastest way to do so 
and is appropriate in this context, as explained below. Reassessing 
the scope of preemption under EPCA and announcing new interpretative 
views regarding Section 32919 entails a more substantive inquiry 
that necessitates additional consideration and deliberation. While 
NHTSA may decide to undertake such a deliberation in the future, the 
Agency's imminent concern is realigning its regulatory statements to 
their legally proper scope and removing the uncertainty caused by 
the SAFE I rule.
    \9\ For instance, NHTSA has particularly identified the 
Preambles cited at the end of this footnote as containing such 
statements. NHTSA seeks public comments on whether there are 
additional preamble statements that contain related statements, 
which should be included in this list. To be clear though, the 
Agency is proposing to withdraw all of such statements that may 
appear in prior NHTSA Preambles, regardless of whether they are 
expressly cited herein. See, e.g., DOT, NHTSA, Light Truck Average 
Fuel Economy Standards Model Years 2005-07, Final Rule, 68 FR 16868, 
16895 (Apr. 7, 2003) (describing NHTSA's views on EPCA preemption in 
the preamble to a final rule setting CAFE standards); DOT, NHTSA, 
Average Fuel Economy Standards for Light Trucks Model Years 2008-
2011; Final Rule, 71 FR 17566, 17654 (Apr. 6, 2006) (describing 
NHTSA's views of EPCA preemption in the preamble to a final rule 
setting CAFE standards).
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    In addition, this approach will ensure that any overstated or 
legally tenuous statements from the SAFE I Rule do not impede NHTSA 
from carefully reassessing its substantive views on EPCA preemption 
and, if warranted, to subsequently announce those views in a new 
setting. Restoring a clean slate is critical because the Agency now has 
significant doubts about the accuracy and prudence of the substantive 
views espoused in the SAFE I rulemaking, including the validity of the 
preemption analysis and the manner in which it failed to account for a 
variety of considerations, including factual circumstances specific to 
policies that would be affected by the Rule and important federalism 
interests.
    Finally, even if NHTSA had authority to issue binding legislative 
rules on preemption, NHTSA still proposes to fully repeal and withdraw 
both these regulations and any interpretative positions. After 
observing the SAFE I Rule's effect on interested stakeholders, ranging 
from states, regulated entities, and the public, and considering the 
temporally-limited and program-specific factual predicates underlying 
NHTSA's prior assertion of permanent and comprehensive preemption, 
NHTSA no longer believes that the Agency must or should expressly 
regulate preemption with the force and effect of law. As such, the 
Agency prefers for its codified regulations to return to a state of 
silence regarding EPCA preemption, particularly as the views on 
preemption expressed in the Appendices and preamble no longer 
necessarily reflect the views of the Agency on these questions.\10\ 
NHTSA may decide to issue interpretations or guidance at a later point, 
if warranted, after further consideration.
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    \10\ As the codified text in Sec. Sec.  531.7 and 533.7 simply 
repeats the statute, those provisions cannot be considered to convey 
any distinct meaning from the verbatim language of Section 32919.
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C. Statutory and Regulatory Background

    In 1975, Congress enacted the Energy Policy and Conservation Act 
(EPCA), which among other goals, sought to

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``conserve energy supplies through energy conservation programs, and 
where necessary, the regulation of certain energy uses.'' \11\ Congress 
included the ``improved energy efficiency of motor vehicles'' among the 
energy conservation and independence objectives specifically enumerated 
in the Act.\12\ To facilitate the enhanced energy efficiency of motor 
vehicles, EPCA charged the DOT to ``prescribe, by rule, average fuel 
economy standards'' for various classifications of motor vehicles.\13\
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    \11\ The Energy Policy and Conservation Act of 1975, Public Law 
94-163, 89 Stat. 871, section 2(4) (``Statement of Purposes'').
    \12\ Id. section 2(5) (``Statement of Purposes'').
    \13\ Id. section 502(3) (``Average Fuel Economy Standards 
Applicable to Each Manufacturer'').
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    In establishing a statutory framework for fuel economy regulation, 
Congress incorporated a provision into EPCA that expressly described 
the preemptive effect of resulting fuel economy standards and 
requirements.\14\ The wording of this provision was slightly modified 
in a recodification of EPCA in 1994. Overall though, both 
contemporaneous legislative sources and courts considering fuel economy 
matters have stressed that ``the 1994 recodification was intended to 
``revise[ ], codif[y], and enact[ ]'' the law ``without substantive 
change.'' \15\ As such, EPCA's original express preemption provision 
remains codified in substantially the same form in 49 U.S.C. 32919. The 
express language of subsection (a) of Section 32919 provides that 
``[w]hen an average fuel economy standard prescribed under this chapter 
is in effect, a State or a political subdivision of a State may not 
adopt or enforce a law or regulation related to fuel economy standards 
or average fuel economy standards for automobiles covered by an average 
fuel economy standard under this chapter.'' \16\ The provision contains 
an exception, which allows that a State or local government ``may 
prescribe requirements for fuel economy for automobiles obtained for 
its own use.'' \17\ In addition, when a Federal fuel economy labeling 
or information requirement is in effect, pursuant to 49 U.S.C. 32908, a 
State or local government may adopt or enforce an identical requirement 
on ``disclosure of fuel economy or fuel operating costs.'' \18\
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    \14\ Id. section 509 (``Effect on State Law'').
    \15\ Green Mountain Chrysler Plymouth Dodge Jeep v. Crombie, 508 
F. Supp. 2d 295, 346 (D. Vt. 2007) (quoting Pub. L. 103-272, 108 
Stat. 745, 745 (1994); H.R. Rep. No. 103-180, at 1 (1994), reprinted 
in 1994 U.S.C.C.A.N. 818, 818; S. Rep. No. 103-265, at 1 (1994)).
    \16\ 49 U.S.C. 32919(a).
    \17\ 49 U.S.C. 32919(c).
    \18\ 49 U.S.C. 32919(b).
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    For nearly 50 years after EPCA's enactment, NHTSA's own regulations 
remained silent regarding the scope or effect of preemption established 
by Section 32919. The Agency has, on occasion, spoken directly on 
various aspects of the scope of EPCA preemption in an interpretative or 
advisory format--most commonly in preambles of CAFE standards 
rulemakings, as well as in briefings in litigation over specific state 
or local laws.\19\ On multiple occasions throughout the Agency's 
history, NHTSA has also incorporated an assessment of state motor 
vehicle emissions programs--including those from California--into the 
substantive analysis of CAFE standards rulemakings. For instance, these 
assessments have often occurred through NHTSA's analysis of the 
regulatory landscape and existing automotive industry practices, which 
NHTSA considers when assessing the ``maximum feasible'' fuel economy 
that can be achieved by manufacturers.\20\ However, until the SAFE I 
Rule, NHTSA's commentary on EPCA preemption occurred exclusively in an 
interpretative context, and the Agency had never established legally 
binding requirements on states through regulatory text.\21\
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    \19\ See, e.g., DOT, NHTSA, Light Truck Average Fuel Economy 
Standards Model Years 2005-07, Final Rule, 68 FR 16868, 16895 (Apr. 
7, 2003) (describing NHTSA's views on EPCA preemption in the 
preamble to a final rule setting CAFE standards); DOT, NHTSA, 
Average Fuel Economy Standards for Light Trucks Model Years 2008-
2011; Final Rule, 71 FR 17566, 17654 (Apr. 6, 2006) (describing 
NHTSA's views of EPCA preemption in the preamble to a final rule 
setting CAFE standards).
    \20\ See, e.g., NHTSA, part 533 Average Fuel Economy Standards 
for Nonpassenger Automobiles, Final Rule, 42 FR 13807, 13814 (Mar. 
14, 1977); NHTSA, Light Truck Average Fuel Economy Standards Model 
Years 2005-2007, Final Rule, 68 FR 16868, 16895 (Apr. 7, 2003).
    \21\ NHTSA did, in 2008, propose language very similar to that 
in the SAFE I Rule. See NHTSA, Average Fuel Economy Standards, 
Passenger Cars and Light Trucks; Model Years 2011-2015, Notice of 
Proposed Rulemaking, 73 FR 24351 (May 2, 2008). However, NHTSA 
finalized only standards for model year 2011 through that rulemaking 
action and chose not to finalize the proposed text regarding 
preemption, explaining that NHTSA ``will re-examine the issue of 
preemption in the content of its forthcoming rulemaking to establish 
Corporate Average Fuel Economy standards for 2012 and later model 
years.'' 74 FR 14196, 14200 (Mar. 30, 2009). NHTSA's subsequent 
joint rulemakings with EPA prior to the SAFE rule continued to defer 
substantive consideration of preemption due to the existence of the 
National Program that involved NHTSA, EPA, and California. See 75 FR 
25324, 25546 (May 7, 2010); 77 FR 62624, 63147 (Oct. 15, 2012).
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    Thus, the SAFE I Rule represented the first Agency action to ever 
finalize and codify rules that purported to create a binding effect on 
the scope of EPCA preemption. The Agency initially proposed the 
preemption regulations finalized in the SAFE I Rule as part of the 
broader joint EPA and NHTSA rulemaking entitled, ``The Safer Affordable 
Fuel-Efficient (SAFE) Vehicles Rule for Model Years 2021-2026 Passenger 
Cars and Light Trucks.'' \22\ As part of this proposal, EPA also 
``propos[ed] to withdraw the waiver granted to California in 2013 for 
the GHG and ZEV requirements of its Advanced Clean Cars program.'' \23\ 
This proposed rule also encompassed NHTSA's proposed CAFE and EPA's 
proposed GHG emissions standards for model years 2021-2026 and various 
regulations regarding administrative aspects of the CAFE and GHG 
programs.\24\ Subsequently, NHTSA and EPA decoupled the NHTSA 
preemption regulations and EPA's revocation of California's Clean Air 
Act waiver from the standards rulemaking. The Agencies jointly 
published the SAFE I Rule on September 27, 2019, with NHTSA finalizing 
the proposed preemption regulations, and EPA revoking California's 
waiver. The Agencies later jointly published a separate final rule that 
set CAFE and GHG emissions standards for model years 2021-2026 
passenger cars and light trucks.\25\
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    \22\ See generally NHTSA, EPA, The Safer Affordable Fuel-
Efficient (SAFE) Vehicles Rule for Model Years 2021-2026 Passenger 
Cars and Light Trucks, Notice of Proposed Rulemaking, 83 FR 42986 
(Aug. 24, 2018).
    \23\ Id. at 42999.
    \24\ Id.
    \25\ NHTSA, EPA, The Safer Affordable Fuel-Efficient (SAFE) 
Vehicles Rule for Model Years 2021-2026 Passenger Cars and Light 
Trucks, Final Rule, 85 FR 24174 (Apr. 30, 2020).
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    The preemption language promulgated by NHTSA in the SAFE I Rule 
appears in several locations in the CFR: 49 CFR 531.7, appendix B to 49 
CFR part 531, 49 CFR 533.7, and appendix B to 49 CFR part 533. The 
provisions in Sec. Sec.  531.7 and 533.7, as well as in each appendix 
B, mirror one another. The only distinction in the two sets of 
regulations is that part 531 applies to passenger automobiles and part 
533 applies to light trucks. Moreover, the language in Sec. Sec.  531.7 
and 533.7 uses nearly verbatim language as the express preemption 
statutory provision, 49 U.S.C. 32919.\26\ Each

[[Page 25984]]

appendix B expressly codifies a prohibition on various state 
activities--particularly those regulating motor vehicle carbon dioxide 
emissions--that the Agency proclaimed were unlawful due to ``express 
preemption'' and ``implied preemption.'' \27\
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    \26\ Since the language in 49 CFR 531.7 and 533.7 merely parrots 
the applicable statutory text, NHTSA questions whether either 
provision even has a unique effect apart from Section 32919. See 
Gonzales v. Oregon, 546 U.S. 243, 257 (2006) (``the existence of a 
parroting regulation does not change the fact that the question here 
is not the meaning of the regulation but the meaning of the 
statute''). Based upon the comments received on the SAFE I Rule, on 
further reflection, NHTSA's view is that this question merely 
augmented the uncertainty among stakeholders about the scope of EPCA 
preemption, and further demonstrates that this codification was 
unnecessary and unhelpful.
    \27\ See 49 CFR part 531, app. B; 49 CFR part 533, app B.
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    Following the promulgation of the SAFE I Rule, the actions of both 
NHTSA and EPA were challenged by a number of petitioners in both the 
United States Court of Appeals for the District of Columbia Circuit 
(D.C. Circuit) and the United States District Court for the District of 
Columbia.\28\ The litigation has substantially divided the regulated 
industry and interested stakeholders, as the D.C. Circuit litigation 
encompasses ten consolidated petitions brought by a number of states, 
cities, and environmental organizations challenging the rule. On the 
other side of the litigation, several automakers, other states, and 
fuel and petrochemical manufacturers have intervened in support of the 
rule. In addition to the litigation, one public interest organization, 
the Chesapeake Bay Foundation, filed a petition for reconsideration 
with NHTSA following the SAFE I Rule's publication.\29\ The Chesapeake 
Bay Foundation subsequently filed a petition for review in the D.C. 
Circuit, which challenges NHTSA's denial of this petition for 
reconsideration.\30\ In light of the Agencies' reconsideration of the 
SAFE I action, the D.C. Circuit granted requests to hold both the 
consolidated litigation and Chesapeake Bay Foundation's subsequent 
lawsuit in abeyance.
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    \28\ See generally Union of Concerned Scientists, et al. v. 
NHTSA, et al., No. 19-1230 (D.C. Cir.). See also California v. Chao, 
No. 19-cv-2826-KBJ (D.D.C.) (filed Sept. 20, 2019).
    \29\ See generally Chesapeake Bay Foundation, Petition for 
Reconsideration of NHTSA's Final Rule--The Safer Affordable Fuel 
Efficient (SAFE) Vehicles Rule Part One: One National Program (Nov. 
8, 2019).
    \30\ See generally Chesapeake Bay Foundation, Inc. v. NHTSA, No. 
20-2091 (D.C. Cir.).
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    On January 20, 2021, President Biden signed Executive Order 13990, 
which directed DOT and NHTSA to immediately undertake an assessment of 
the SAFE I Rule.\31\ Specifically, Executive Order 13990 directed DOT 
and NHTSA to, ``as appropriate and consistent with applicable law, 
consider suspending, revising, or rescinding'' the SAFE I Rule.\32\ For 
the SAFE I Rule, the Executive order also instructed that the Agency, 
``as appropriate and consistent with applicable law, shall consider 
publishing for notice and comment a proposed rule suspending, revising, 
or rescinding the agency action . . . by April 2021.'' \33\
---------------------------------------------------------------------------

    \31\ Executive Order 13990, Protecting Public Health and the 
Environment and Restoring Science to Tackle the Climate Crisis, 86 
FR 7037 (Jan. 25, 2021).
    \32\ Id. at Sec. 2.
    \33\ Id. at Sec. 2-2(ii).
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D. Reconsideration Authority

    NHTSA, like any other Federal agency, is afforded an opportunity to 
reconsider prior views and, when warranted, to adopt new positions. 
Indeed, as a matter of good governance, agencies should revisit their 
positions when appropriate, especially to ensure that their actions and 
regulations reflect legally sound interpretations of the agency's 
authority and remain consistent with the agency's views and practices. 
As a matter of law, ``an Agency is entitled to change its 
interpretation of a statute.'' \34\ Nonetheless, ``[w]hen an Agency 
adopts a materially changed interpretation of a statute, it must in 
addition provide a `reasoned analysis' supporting its decision to 
revise its interpretation.'' \35\
---------------------------------------------------------------------------

    \34\ Phoenix Hydro Corp. v. F.E.R.C., 775 F.2d 1187, 1191 (D.C. 
Cir. 1985).
    \35\ Alabama Educ. Ass'n v. Chao, 455 F.3d 386, 392 (D.C. Cir. 
2006) (quoting Motor Vehicle Mfrs. Ass'n of U.S., Inc. v. State Farm 
Mut. Auto. Ins. Co., 463 U.S. 29, 57 (1983)); see also Encino 
Motorcars, LLC v. Navarro, 136 S. Ct. 2117, 2125 (2016) (``Agencies 
are free to change their existing policies as long as they provide a 
reasoned explanation for the change.'') (citations omitted).
---------------------------------------------------------------------------

    ``Changing policy does not, on its own, trigger an especially 
`demanding burden of justification.' '' \36\ Providing a reasoned 
explanation ``would ordinarily demand that [the Agency] display 
awareness that it is changing position.'' \37\ Beyond that, however, 
``[w]hen an agency changes its existing position, it `need not always 
provide a more detailed justification than what would suffice for a new 
policy created on a blank slate.' '' \38\ While the Agency ``must show 
that there are good reasons for the new policy,'' the Agency ``need not 
demonstrate to a court's satisfaction that the reasons for the new 
policy are better than the reasons for the old one.'' \39\ ``[I]t 
suffices that the new policy is permissible under the statute, that 
there are good reasons for it, and that the Agency believes it to be 
better, which the conscious change of course adequately indicates.'' 
\40\ For instance, ``evolving notions'' about the appropriate balance 
of varying policy considerations constitute sufficiently good reasons 
for a change in position.\41\ Moreover, it is ``well within an Agency's 
discretion'' to change policy course even when no new facts have 
arisen: Agencies are permitted to conduct a ``reevaluation of which 
policy would be better in light of the facts,'' without ``rely[ing] on 
new facts.'' \42\
---------------------------------------------------------------------------

    \36\ See Mingo Logan Coal Co. v. E.P.A., 829 F.3d 710, 718 (D.C. 
Cir. 2016) (quoting Ark Initiative v. Tidwell, 816 F.3d 119, 127 
(D.C. Cir. 2016)).
    \37\ FCC v. Fox Television Stations, Inc., 556 U.S. 502, 515 
(2009) (emphasis in original) (``An agency may not, for example, 
depart from a prior policy sub silentio or simply disregard rules 
that are still on the books.'').
    \38\ Encino Motorcars, LLC, 136 S. Ct. at 2125-26 (quoting Fox 
Television Stations, Inc., 556 U.S. at 515).
    \39\ Fox Television Stations, Inc., 556 U.S. at 515 (emphasis in 
original).
    \40\ Id. (emphasis in original).
    \41\ N. Am.'s Bldg. Trades Unions v. Occupational Safety & 
Health Admin., 878 F.3d 271, 303 (D.C. Cir. 2017) (quoting the 
agency's rule). To be sure, providing ``a more detailed 
justification'' is appropriate in some cases. See Fox Television 
Stations, Inc., 556 U.S. at 515 (2009) (``Sometimes [the agency] 
must [provide a more detailed justification than what would suffice 
for a new policy created on a blank slate]--when, for example, its 
new policy rests upon factual findings that contradict those which 
underlay its prior policy; or when its prior policy has engendered 
serious reliance interests that must be taken into account.''). This 
is not one of those cases: NHTSA's reconsidered understanding of the 
governing legal framework does not ``rest[ ] upon factual findings 
that contradict those which underlay its prior policy.'' Moreover, 
the reconsideration does not undermine ``engendered serious reliance 
interests that must be taken into account.,'' The uncertainty 
associated with the SAFE I rulemaking, which is described further 
herein, has not created an environment in which any interested 
stakeholders could reasonably rely upon a framework that presupposed 
the continuance of the SAFE I Rule.
    \42\ Nat'l Ass'n of Home Builders v. E.P.A., 682 F.3d 1032, 
1037-38 (D.C. Cir. 2012).
---------------------------------------------------------------------------

    NHTSA views this need to reassess its stated positions as 
particularly appropriate and imperative when the issues either 
implicate the limits of the Agency's statutory authority or concern 
positions on critical policy issues that no longer necessarily reflect 
that agency's views. This is especially important in matters regarding 
the preemption of state law, given both the federalism interests at 
stake and because ``agencies have no special authority to pronounce on 
pre-emption absent delegation by Congress.'' \43\ NHTSA believes that 
upon tentatively determining that legal authority previously claimed 
likely does not exist, the most responsible and legally essential 
course of action is for the Agency to exercise its reconsideration 
authority to explore and, if necessary, rectify the potential overstep. 
This is the precise action that NHTSA proposes here.
---------------------------------------------------------------------------

    \43\ See Wyeth v. Levine, 555 U.S. 555, 577 (2009).

---------------------------------------------------------------------------

[[Page 25985]]

E. Proposed Repeal of Regulations in the SAFE I Rule

    After a comprehensive reconsideration of the SAFE I Rule, NHTSA now 
has substantial doubts about whether Congress provided the Agency with 
the authority necessary to engage in legislative rulemaking \44\ to 
define the scope of preemption in 49 U.S.C. 32919.\45\ Ultimately, 
``agencies have no special authority to pronounce on preemption absent 
delegation by Congress.'' \46\ Neither the language of Section 32919 
nor the broader regulatory structure of Chapter 329 provide NHTSA with 
the authority to promulgate regulations with the force and effect of 
law on EPCA preemption. Moreover, contrary to the indications in the 
SAFE I Rule, NHTSA provisionally considers a general delegation of 
authority to the Secretary to ``carry out'' his ``duties and powers'' 
to be insufficient to support a legislative rulemaking that expressly 
administers preemption under Section 32919. Consequently, NHTSA now 
proposes to conclude that it likely overstepped its authority in 
issuing binding legislative rules on preemption.\47\ Therefore, NHTSA 
proposes to repeal each of these provisions in full to ensure that its 
actions are unquestionably within the legally permissible boundaries of 
the Agency's authority. Repealing these rules would also restore the 
Agency's previous practice, in which NHTSA did not codify 
interpretations of EPCA preemption in regulations.
---------------------------------------------------------------------------

    \44\ As used in this document, the term ``legislative 
rulemaking'' refers to an agency's authority to promulgate 
regulations that carry the force and effect of law. See, e.g., 
Batterton v. Francis, 432 U.S. 416, 425 (1977) (noting that when a 
Federal agency promulgates a rule within the scope of its 
congressionally delegated authority, the agency ``adopts regulations 
with legislative effect'').
    \45\ NHTSA, EPA, The Safer Affordable Fuel-Efficient (SAFE) 
Vehicles Rule Part One: One National Program, Final Rule, 84 FR 
51310, 51320 (Sept. 27, 2019).
    \46\ Wyeth v. Levine, 555 U.S. 555, 577 (2009).
    \47\ The Agency acknowledges that there may be some potential 
ambiguity as to whether the SAFE I Rule established binding 
legislative rules or interpretative rules, as the Agency described 
the effect of the rule in varying ways in that final rule, 
particularly in its preamble. As described below, NHTSA believes the 
SAFE I Rule was intended to be a legislative rule. However, to the 
extent it is considered an interpretative rule, NHTSA believes it 
would still be appropriate to rescind the rule for the reasons 
described in Part F, infra.
---------------------------------------------------------------------------

1. NHTSA Is Concerned That the SAFE I Rule's Issuance of Binding, 
Legislative Rules on EPCA Preemption Exceeded the Agency's Authority

    The preemption analysis begins with consideration of the governing 
statute. However, while EPCA already contains an express preemption 
provision in Section 32919, the Appendices promulgated in the SAFE I 
Rule expressed, in more specific terms than Section 32919, precise 
types of state regulation that would be preempted--namely, state 
efforts to regulate carbon dioxide emissions from motor vehicles or to 
establish requirements for ZEVs.\48\ These regulations purported to 
expressly prohibit the conduct in question through their force as 
Federal regulations.
---------------------------------------------------------------------------

    \48\ See 49 CFR part 531, app. B; 49 CFR part 533, app. B.
---------------------------------------------------------------------------

    The Agency has tentatively determined that these regulations are 
legislative rules, which seek to preempt state regulations in more 
specific terms than the express preemption provision already present in 
EPCA. As noted above, Congress included an express preemption provision 
in EPCA in Section 32919. This statute expressly preempts state laws or 
regulations ``related to fuel economy standards or average fuel economy 
standards for automobiles,'' ``when an average fuel economy standard 
prescribed under [Chapter 329] is in effect.'' \49\ Both the Agency and 
courts have repeatedly understood Section 32919 as self-executing and 
capable of direct application to state regulatory activity.\50\ 
Specifically, such a direct application involves the consideration of 
whether the state regulation in question ``relate[s] to'' fuel economy 
standards established elsewhere in Chapter 329.\51\ The statute does 
not require any supplemental agency regulations to implement this 
standard, nor does the text and structure of the statute appear to 
provide NHTSA any special legislative role in dictating the scope of 
Section 32919's preemption.
---------------------------------------------------------------------------

    \49\ 49 U.S.C. 32919(a).
    \50\ See, e.g., Green Mountain Chrysler Plymouth Dodge Jeep, 508 
F. Supp. at 295 (undertaking a detailed analysis of Section 32919 to 
determine whether state law was preempted under the express language 
of the statute).
    \51\ See Cent. Valley Chrysler-Jeep, Inc. v. Goldstene, 529 F. 
Supp. 2d 1151, 1175 (E.D. Cal. 2007), as corrected (Mar. 26, 2008) 
(conducting such an analysis before concluding that preemption did 
not exist ``[g]iven the narrow scope the court must accord EPCA's 
``related to'' language'').
---------------------------------------------------------------------------

    Accordingly, NHTSA tentatively believes that the SAFE I Rule, which 
codified additional binding standards for express EPCA preemption, 
represented an additional act of express preemption beyond the self-
contained language of Section 32919. Through the SAFE I Rule, NHTSA 
codified four provisions in the CFR, each of which purported to 
directly regulate the scope of preemption under EPCA. Specifically, 
NHTSA promulgated 49 CFR 531.7 and 533.7, both of which were nearly 
verbatim codifications of the statutory text, and an identical appendix 
B to both parts 531 and 533, which included a description of certain 
state regulations also described as preempted. None of these provisions 
instituted any new compliance or enforcement standards relating to 
NHTSA's CAFE program. Instead, the provisions, by their own terms, 
solely sought to codify into NHTSA's regulations a binding framework to 
govern the scope of EPCA preemption.
    As the Preamble to the SAFE I Final Rule described, these 
provisions sought to ``ma[ke] explicit that state programs to limit or 
prohibit tailpipe GHG emissions or establish ZEV mandates are 
preempted.'' \52\ In announcing the SAFE I Rule, NHTSA repeatedly 
described the final rules in terms that appeared to confer upon them 
legally binding connotations. For instance, the Agency noted that 
through the final rule, ``NHTSA intends to assert preemption'' \53\ and 
characterized the regulations as ``implementing'' \54\ a preemption 
requirement. Subpart ``a'' of each appendix B to parts 531 and 533 even 
labels the regulatory text as ``Express Preemption'' provisions, before 
proceeding to categorically assert, in mandatory terms, what types of 
state laws were preempted.\55\ Such a direct declaration of preemption, 
which purported to carry the force and effect of law, seeks to provide 
an authoritative interpretation of the language of Section 32919, and 
the regulations represented an act of legislative rulemaking that 
attempted to impose more specific, binding requirements on State and 
local governments. In order to properly engage in such legislative 
rulemaking, NHTSA must have adequate authority to do so from Congress. 
However, after reconsidering the matter, NHTSA has substantial doubts 
about whether it has the requisite authority to validly promulgate such 
requirements.
---------------------------------------------------------------------------

    \52\ NHTSA, EPA, The Safer Affordable Fuel-Efficient (SAFE) 
Vehicles Rule Part One: One National Program, Final Rule, 84 FR 
51310 (Sept. 27, 2019).
    \53\ Id. at 51317.
    \54\ Id. at 51318.
    \55\ See, e.g., 49 CFR part 533, app. B(a)(2) (``As a law or 
regulation of a State or a political subdivision of a State related 
to fuel economy standards, any state law or regulation regulating or 
prohibiting tailpipe carbon dioxide emissions from automobiles is 
expressly preempted under 49 U.S.C. 32919.'').

---------------------------------------------------------------------------

[[Page 25986]]

2. Congress Must Have Provided NHTSA With Authority To Engage in 
Legislative Rulemaking on Matters of EPCA Preemption if That Rulemaking 
Is To Be Valid

    The legitimacy of an agency's exercise of preemption power through 
legislative rulemaking is principally a question of the extent of 
authority delegated to the agency. This is because all rulemaking 
authority of an agency ultimately derives from Congress.\56\ As such, 
``in a situation where state law is claimed to be pre-empted by Federal 
regulation, a narrow focus on Congress' intent to supersede state law 
[is] misdirected.'' \57\ Instead, when considering an agency's 
preemptive authority, ``the inquiry becomes whether the federal agency 
has properly exercised its own delegated authority rather than simply 
whether Congress has properly exercised the legislative power.'' \58\ 
Consequently, an agency ``may act only when and how Congress lets 
[it].'' \59\ This restriction extends to all aspects of an agency's 
regulatory activity--including a rulemaking. The matters upon which an 
agency may promulgate rules imbued with the force and effect of law are 
based on its delegated authority.\60\
---------------------------------------------------------------------------

    \56\ Cent. United Life Ins. Co. v. Burwell, 827 F.3d 70, 73 
(D.C. Cir. 2016).
    \57\ City of New York v. F.C.C., 486 U.S. 57, 64 (1988).
    \58\ Id.
    \59\ Cent. United Life Ins. Co., 827 F.3d at 73.
    \60\ See, e.g., Adams Fruit Co. v. Barrett, 494 U.S. 638, 650 
(1990) (determining that a Department of Labor regulation exceeded 
the scope of authority delegated by a statute the agency 
administered).
---------------------------------------------------------------------------

    These limitations particularly apply with respect to matters of 
preemption. As the Supreme Court has made clear:

A federal agency may pre-empt state law only when and if it is 
acting within the scope of its congressionally delegated authority. 
This is true for at least two reasons. First, an agency literally 
has no power to act, let alone pre-empt the validly enacted 
legislation of a sovereign State, unless and until Congress confers 
power upon it. Second, the best way of determining whether Congress 
intended the regulations of an administrative agency to displace 
state law is to examine the nature and scope of the authority 
granted by Congress to the agency.\61\
---------------------------------------------------------------------------

    \61\ Louisiana Pub. Serv. Comm'n v. F.C.C., 476 U.S. 355, 374 
(1986).

    Since an agency lacks plenary authority, the delegation of one 
power to an agency does not necessarily include other powers, even if 
they are related.\62\ This applies even when the authority is 
analogous. For instance, the D.C. Circuit has rejected an agency's 
argument ``that it possesses plenary authority,'' holding instead 
``that the fact that the Board is empowered'' in a particular 
circumstance does not ``mean[] the Board therefore enjoys such power in 
every instance'' in which a similar question arises.\63\ Accordingly, 
construing an agency's authority requires a close examination of the 
precise power delegated by Congress and how such authority may differ, 
even if slightly, from other authority that Congress may reserve.
---------------------------------------------------------------------------

    \62\ Ry. Labor Executives' Ass'n., 29 F.3d at 670 (en banc).
    \63\ Id.
---------------------------------------------------------------------------

    That is, in order for an agency to issue binding rules on 
preemption, the agency must have the authority to directly regulate 
preemption itself, rather than merely to establish the substantive law 
that leads to preemption.\64\ Therefore, in evaluating an agency's 
authority to issue legislative rules on preemption, the proper question 
is whether Congress intended the agency to define, through its binding 
regulations, when a state law is preempted. Only if Congress has 
granted an agency that power does the agency have the authority to 
speak with the force of law directly on preemption. NHTSA's tentative 
conclusion, as described below, is that Congress does not appear to 
have granted NHTSA such authority, and that in light of this doubt, the 
Agency should not have issued such regulations in the first instance.
---------------------------------------------------------------------------

    \64\ See, e.g., City of New York, 486 U.S. at 64 (clarifying 
that ``the correct focus is on the federal agency that seeks to 
displace state law and on the proper bounds of its lawful authority 
to undertake such action.'').
---------------------------------------------------------------------------

3. NHTSA Has Substantial Doubts That EPCA Authorizes NHTSA To Issue 
Legislative Rules on Preemption

    EPCA does not appear to expressly provide the authority to DOT or 
NHTSA to promulgate legislative rules implementing or defining the 
scope of the statute's preemption. Throughout its rulemakings over the 
long history of the CAFE program, NHTSA has consistently declined to 
construe either Section 32919 or any other provision of EPCA as 
expressly delegating DOT or NHTSA the authority to promulgate 
preemption regulations. This approach even extends to the SAFE I 
rulemaking, in which the Agency cited other statutory provisions for 
its authority to issue the rules.\65\ The Agency continues to hold this 
view of the statute.
---------------------------------------------------------------------------

    \65\ See NHTSA, EPA, The Safer Affordable Fuel-Efficient (SAFE) 
Vehicles Rule Part One: One National Program, Final Rule, 84 FR 
51310, 51320 (Sept. 27, 2019) (citing other statutory provisions 
applicable to DOT for the requisite rulemaking authority).
---------------------------------------------------------------------------

    Section 32919, the express preemption provision of EPCA, states 
that ``a State or a political subdivision of a State may not adopt or 
enforce a law or regulation related to fuel economy standards'' as long 
as a Federal fuel economy standard is in place.\66\ Thus, this 
preemption provision offers the best evidence of any possible 
congressional intent to confer preemption rulemaking authority upon 
NHTSA. However, the provision is notably silent as to any role of the 
agency in administering--much less defining--a preemption scheme. At 
most, the statute merely refers to the substantive tasks of the agency 
to establish ``fuel economy standard[s]'' and ``requirements'' as set 
forth elsewhere in Chapter 329.\67\ Such references only connote the 
core duties borne by the agency to administer the substance of the fuel 
economy program, such as by setting ``maximum feasible average fuel 
economy'' standards under Section 32902 or establishing fuel economy 
labeling requirements under Section 32908. These responsibilities are 
within the agency's traditional substantive regulatory functions, which 
draw from NHTSA's technical automobile expertise rather than any 
special agency authority over federalism. In the Agency's tentative 
view, it seems more reasonable to conclude that if Congress had 
intended to give NHTSA such direct regulatory authority over EPCA 
preemption, it would have done so explicitly, and likely within Section 
32919 or at least in direct reference to preemption.
---------------------------------------------------------------------------

    \66\ 49 U.S.C. 32919.
    \67\ See 49 U.S.C. 32919(a)-(b).
---------------------------------------------------------------------------

    Thus, the Agency is now of the view that, under the language of 
Section 32919, the express preemption instituted by the statute is 
self-executing and self-contained. This is consistent with NHTSA's 
longstanding reading of Section 32919. For instance, even the Preamble 
to the SAFE I Final Rule acknowledged that the EPCA preemption 
provision of Section 32919 was ``self-executing,'' and that ``state or 
local requirements related to fuel economy standards are void ab 
initio''--by operation of statute not regulation.\68\ Likewise, in the 
National Environmental Policy Act of 1969 (NEPA) section of the SAFE I 
Rule, NHTSA expressly disclaimed any discretion to alter the preemption 
paradigm established by Section 32919 due to the self-sufficiency of 
the statute, stressing that ``[a]ny preemptive effect resulting from 
this final action is not the result of the exercise of Agency 
discretion, but rather reflects the operation and application of the 
Federal statute.'' \69\ As such, the

[[Page 25987]]

Agency again characterized any ``preempted standards [as] void ab 
initio'' due to the non-discretionary and independent application of 
Section 32919.\70\ Due to the express language of Section 32919, NHTSA 
continues to believe that the provisions of Section 32919 are self-
executing. Consequently, the Agency has substantial doubts about the 
validity of its prior conclusion that Congress provided rulemaking 
authority to the Agency to further codify preemption requirements. In 
reaching this tentative conclusion, NHTSA notes that the structures of 
other parts of EPCA, as well as other Federal statutes, expressly 
charge an agency to administer preemption through regulations, and no 
such charge exists for NHTSA. For example, a precursor to the 
Department of Energy, the Federal Energy Administration, was expressly 
directed elsewhere in EPCA to ``prescribe . . . rule[s]'' that preempt 
state and local appliance-efficiency standards.\71\ Likewise, other DOT 
statutes expressly provide a regulatory, or even adjudicatory, role for 
the Department in the preemption analysis. For instance, in the 
transportation of hazardous materials context, 49 U.S.C. 5125 directs 
the Secretary to adjudicate applications on whether a particular state 
standard is ``substantially the same'' as Federal law and, as such, 
exempted from statutory preemption.\72\ Similarly, 49 U.S.C. 31141 
establishes a very detailed role for DOT in reviewing and preempting 
state law pertaining to commercial motor vehicle safety.\73\ Many of 
the seminal cases in the Supreme Court's preemption jurisprudence also 
concerned statutory schemes that expressly delegated preemption 
authorities to the agencies in question.\74\
---------------------------------------------------------------------------

    \68\ NHTSA, EPA, The Safer Affordable Fuel-Efficient (SAFE) 
Vehicles Rule Part One: One National Program, Final Rule, 84 FR 
51310, 51325 (Sept. 27, 2019).
    \69\ Id. at 51353-54.
    \70\ Id.
    \71\ The Energy Policy and Conservation Act of 1975, Public Law 
94-163, 89 Stat. 871, section 327(b), recodified as amended at 42 
U.S.C. 6297(d).
    \72\ 49 U.S.C. 5125(d). The Secretary has delegated this 
responsibility to another DOT operating administration, the Pipeline 
and Hazardous Materials Safety Administration (PHMSA).
    \73\ See 49 U.S.C. 31141 (expressly stating that ``[a] State may 
not enforce a State law or regulation on commercial motor vehicle 
safety that the Secretary of Transportation decides under this 
section may not be enforced'' before enumerating multiple 
subsections that define an adjudicatory role for the DOT, complete 
with preemption standards and procedures). The Secretary has 
delegated this responsibility to another DOT operating 
administration, the Federal Motor Carrier Safety Administration 
(FMCSA).
    \74\ For example, in a set of cases evaluating the preemption of 
certain state tort law relating to medical device product liability, 
the Supreme Court analyzed U.S. Food and Drug Administration (FDA) 
regulations that specifically defined when preemption occurred under 
the applicable statute, the Medical Device Amendments (MDA). See 
generally Lohr, 518 U.S. at 470 (plurality opinion); Riegel v. 
Medtronic, Inc., 552 U.S. 312 (2008). See also 21 U.S.C. 360k; 21 
CFR 808.1.
---------------------------------------------------------------------------

    As these other statutory provisions demonstrate, Congress 
understands how to incorporate legislative rulemaking authority for an 
agency expressly and directly into a statutory framework for 
preemption--and, in fact, exercised this prerogative elsewhere in EPCA. 
These responsibilities range from charging an agency to promulgate 
clarifying regulations on the applicability of preemption to 
instructing an agency to establish an administrative procedure to 
adjudicate exemptions of state law. Moreover, as 49 U.S.C. 31141 
demonstrates, when Congress decides to incorporate an agency into the 
preemption determination process, the grant of authority is often not 
accomplished through an indeterminate delegation, but instead, through 
an intricate and comprehensive description of the agency's precise role 
in administering the preemption provision.
    Within this statutory landscape, the total silence of Section 32919 
as to any role for NHTSA in the implementation of preemption seems 
instructive. In this context, it now appears to the Agency that 
construing Section 32919 to permit NHTSA to issue regulations with the 
force of law that regulate and define the scope of preemption, as the 
Agency did in the SAFE I Rule, would be akin to reading an entirely new 
subsection into the statutory provision. Congress' failure to 
explicitly provide DOT authority to define or otherwise regulate the 
scope of CAFE preemption--despite specifically incorporating an express 
preemption provision into EPCA in Section 32919--casts significant 
doubts upon the Agency's prior determination that NHTSA has legislative 
rulemaking authority in matters of fuel economy preemption. NHTSA 
requests comment on these provisional views.
    Finally, contrary to the arguments made in the SAFE I Rule, NHTSA 
tentatively believes there is no other statutory source conferring 
legislative rulemaking authority on the Agency in matters of fuel 
economy preemption. In the SAFE I rulemaking, NHTSA did not claim that 
its authority to issue preemption regulations derived from Section 
32919.\75\ Instead, NHTSA concluded that its authority arose implicitly 
from EPCA, because the Agency argued that it could not carry out its 
CAFE standard-setting responsibilities in the face of state regulation 
that undermined its authority.\76\ In the SAFE I Final Rule's most 
direct discussion of the issue of authority to promulgate regulations 
concerning preemption, NHTSA linked the perceived conflict between 
EPCA's purposes and state regulation to the general delegation of 
authority to the Secretary to carry out his duties. Specifically, after 
describing Section 322 as an express authorization for the Secretary of 
Transportation ``to prescribe regulations to carry out her duties and 
powers,'' and noting that Chapter 329 of Title 49 delegated the 
Secretary's authority to NHTSA for EPCA purposes, the Agency concluded 
in the SAFE I Rule that it ``ha[d] clear authority to issue this 
regulation under 49 U.S.C. 32901 through 32903 to effectuate a national 
automobile fuel economy program unimpeded by prohibited State and local 
requirements.'' \77\ This is because the Agency characterized the 
rulemaking as simply ``carry[ing] out'' the preemption scope of Section 
32919.\78\
---------------------------------------------------------------------------

    \75\ See generally NHTSA, EPA, The Safer Affordable Fuel-
Efficient (SAFE) Vehicles Rule Part One: One National Program, Final 
Rule, 84 FR 51310, 51320 (Sept. 27, 2019).
    \76\ See, e.g., id. at 51317.
    \77\ Id. at 51320.
    \78\ Id.
---------------------------------------------------------------------------

    Upon reconsideration, NHTSA is concerned that this rationale was 
improper. Section 322 contains statutory language of broad 
applicability that extends well beyond the CAFE program and, indeed, 
well beyond NHTSA. In light of the preceding discussion, it seems 
especially peculiar to derive preemption authority from Section 322 
when EPCA already contains an express preemption provision, which does 
not provide NHTSA with a role in further defining that preemption with 
the force and effect of law. Since Congress already crafted a specific 
provision to describe EPCA preemption in Section 32919, the more 
general terms of Section 322 would seem of much clearer applicability 
if Section 32919 had otherwise delegated NHTSA certain authorities or 
responsibilities to carry out. But as discussed above, Congress did 
not, in EPCA, appear to charge NHTSA with any authority or 
responsibility with respect to preemption regulations. Construing 
Section 322's general terms to independently provide NHTSA with the 
authority to issue legislative rules on EPCA preemption that override 
Section 32919's notable silence as to any role for NHTSA would require 
an extraordinarily expansive reading of Section 322.
    Moreover, even apart from Section 322, general inferences drawn 
from the broad purposes of EPCA do not seem capable of contravening a 
clear reading

[[Page 25988]]

of the express preemption provision in Section 32919. As described 
above, the SAFE I Rule argued that regulation was needed to resolve a 
perceived irreconcilable conflict between state GHG emissions 
regulations and ZEV mandates and EPCA's delegation of authority to 
NHTSA to set national fuel economy standards.\79\ However, even 
assuming that is true, the statutory provision on preemption provides 
no role for NHTSA to speak on this issue with the force and effect of 
law. The Agency does not believe that a proper statutory reading 
permits this unambiguous silence in Section 32919 to be overridden by 
intangible inferences extrapolated from EPCA generally.\80\
---------------------------------------------------------------------------

    \79\ NHTSA, EPA, The Safer Affordable Fuel-Efficient (SAFE) 
Vehicles Rule Part One: One National Program, Final Rule, 84 FR 
51310, 51319 (Sept. 27, 2019).
    \80\ Even if such a conflict existed, it would seem to only bear 
upon an implied (conflict) preemption analysis, not whether NHTSA 
had authority to promulgate binding regulations that expressly 
governed preemption. Express and implied preemption are district 
legal concepts. See, e.g., Geier v. Am. Honda Motor Co., 529 U.S. 
861, 872 (2000) (distinguishing between express and implied 
preemption). Accordingly, the SAFE I Rule's arguments for implied 
(conflict) preemption cannot be used to bootstrap authority to 
regulate through legislative rules that expressly codify mandatory 
preemption requirements.
---------------------------------------------------------------------------

    Likewise, upon reconsideration, NHTSA does not consider any such 
general inferences as appropriately addressed through the categorical 
rulemaking actions of the SAFE I Rule. For example, a substantial 
portion of the SAFE I Rule drew from principles of implied conflict 
preemption, seeking to label state regulation as preempted due to an 
irreconcilable conflict with Federal CAFE standards. Moreover, at most, 
the SAFE I Rule discussed compliance technologies specific to only one 
example of state standards and one example of Federal standards.\81\ 
Yet the SAFE I Rule sought to extrapolate upon such a limited analysis 
to justify a pronouncement of preemption for any state greenhouse gas 
standards or ZEV requirements. The Agency now recognizes that implied 
preemption, which arises primarily in a judicial context, involves 
principles that are most appropriately applied by reference to specific 
state programs, rather than in the abstract and categorical manner of 
the SAFE I Rule's regulations.\82\ While NHTSA still retains 
interpretative authority to set forth its advisory views on whether a 
state regulation impermissibly conflicts with Federal law, such 
authority does not support the power to codify binding legislative 
rules on the matter.
---------------------------------------------------------------------------

    \81\ The terminology used throughout the SAFE I rulemaking 
analysis mirrors the standards used by courts to apply the judicial 
doctrine of implied (conflict) preemption. For instance, the SAFE I 
Preambles repeatedly invoked conflict preemption standards--
``frustrates,'' ``conflicts,'' and ``interferes''--to label state 
programs preempted. See City of New York, 486 U.S. at 64 (``The 
statutorily authorized regulations of an agency will pre-empt any 
state or local law that conflicts with such regulations or 
frustrates the purposes thereof.'') (emphasis added); See, e.g., 
Wyeth, 555 U.S. at 576 (``This Court has recognized that an agency 
regulation with the force of law can pre-empt conflicting state 
requirements.'') (emphasis added); See, e.g., Patriotic Veterans, 
Inc. v. Indiana, 736 F.3d 1041, 1051 (7th Cir. 2013) (describing how 
under the doctrine of conflict preemption, state law may be 
preempted ``if it interferes'' with Federal law) (emphasis added).
    \82\ See, e.g., Wyeth, 555 U.S. at 576 (noting that implied 
preemption principally applies after ``the Court has performed its 
own conflict determination relying on the substance of state and 
federal law and not on agency proclamations of pre-emption.'').
---------------------------------------------------------------------------

    Thus, upon reconsideration, NHTSA has substantial doubts about its 
authority to issue legislative rules concerning EPCA preemption. Thus, 
the SAFE I Rule's effort to establish such rules likely exceeded the 
Agency's authority. For this reason, and for the additional reasons 
discussed herein, NHTSA is now of the view that the SAFE I Rule rests 
upon an infirm foundation and should be repealed. We seek comment on 
this tentative determination.

F. Proposed Repeal of Preemption Interpretations in the SAFE I Rule

    In addition to the proposed repeals of the codified provisions 
promulgated in the SAFE I Rule, NHTSA also proposes to rescind the 
accompanying substantive analysis in the Preambles of the Proposed and 
Final SAFE I Rules--including positions on California's GHG and ZEV 
programs. Descriptions of California's GHG and ZEV regulations, as well 
as regulations of states adopting those regulations under Section 177 
of the Clean Air Act, were repeatedly used throughout the SAFE I 
rulemaking analysis as illustrative of why the Agency decided to codify 
the express preemption text in parts 531 and 533 and their accompanying 
Appendices. For example, after explaining the specific preemption 
regulations, the Agency noted that ``[i]n the proposal, NHTSA 
described, as an example, California's ZEV mandate, which manufacturers 
must comply with individually for each state adopting California's 
mandate.'' \83\ Therefore, these substantive positions on state law 
were presented in the SAFE I rulemaking as exemplary of the need for 
regulations, and the finalized text sought to preempt these precise 
state programs. Consequently, NHTSA considers such examples and 
substantive positions as inextricably linked to the regulatory text 
and, as such, would also be rescinded upon the proposed removal of the 
regulations.
---------------------------------------------------------------------------

    \83\ NHTSA, EPA, The Safer Affordable Fuel-Efficient (SAFE) 
Vehicles Rule Part One: One National Program, Final Rule, 84 FR 
51310, 51314 (Sept. 27, 2019) (emphasis added).
---------------------------------------------------------------------------

    However, to be abundantly clear, NHTSA is also proposing in this 
document to repeal any interpretative positions regarding EPCA 
preemption that may be contained within the Preambles of the SAFE I 
NPRM and Final Rule regardless of whether they are linked to the 
codified text. This includes any views on whether particular state 
motor vehicle GHG emissions programs or ZEV mandates conflict with or 
``relate to'' CAFE standards or are otherwise preempted by Section 
32919. Given the Agency's concerns about the lack of legislative 
rulemaking authority on matters of EPCA preemption, any surviving 
substantive views on the topic would constitute, at most, 
interpretative rules.\84\ As such, their repeal would not require the 
notice and comment procedures set forth in 5 U.S.C. 553. Nevertheless, 
an agency may find it useful and prudent to seek public comment on 
interpretations or other agency actions as a matter of good government, 
and NHTSA is doing so here. Due to the anticipated substantial public 
interest in this action, NHTSA's interest in gaining a broad array of 
perspectives on its change in course, and the well-established utility 
of notice and comment procedures, the Agency is still including a 
repeal of these interpretations as part of the proposal rather than 
immediately finalizing a repeal of these views in this document.
---------------------------------------------------------------------------

    \84\ See, e.g., Am. Tort Reform Ass'n v. OSHA, 738 F.3d 387, 394 
(D.C. Cir. 2013). In addition, the following discussion and 
rationales would also apply to the codified text that NHTSA proposes 
to repeal above if that text were determined to be an interpretative 
rule rather than a legislative rule.
---------------------------------------------------------------------------

    At this time, the Agency is not proposing to replace any such 
interpretations with further views on the relationship between state 
motor vehicle GHG emissions programs or ZEV mandates and EPCA 
preemption. Instead, the Agency is exercising its rulemaking authority 
under 5 U.S.C. 551 to propose simply repealing, rather than amending, 
any such interpretative positions or interpretative rules of the 
Agency. Several considerations incline the Agency to propose repealing 
such interpretations, rather than leave them undisturbed or amend them 
through this rulemaking.

[[Page 25989]]

1. Repealing the Interpretive Provisions Makes Clear That All Aspects 
of the SAFE I Rule Have Been Repealed

    First, repealing the interpretations treats them consistently with 
the codified rules, which we are here proposing for repeal. While the 
Agency possesses authority to issue advisory, interpretative rules on 
matters pertaining to EPCA preemption, repealing and withdrawing the 
interpretative positions of the SAFE I rulemaking promotes clarity by 
ensuring that such views are withdrawn along with their accompanying 
regulatory text, rather than leaving an ambiguity as to whether a 
particular statement or provision regarding EPCA preemption remains in 
effect. The ambiguity regarding the legal nature and effect of the 
codified text and positions announced in the SAFE I Rule would only 
amplify confusion if NHTSA proposed to repeal only parts of the 
rulemaking.
    The lack of clarity regarding this distinction is pervasive in the 
SAFE I Rule, which often blurred the line between when the Agency was 
attempting to merely articulate views on preemption under Section 
32919, which were merely advisory, and when NHTSA sought to 
categorically forbid state action through Federal preemption. For 
example, the Preambles to the SAFE I Rule repeatedly labeled certain 
types of state GHG regulation and ZEV mandates as categorically 
preempted and prohibited, even if those programs were not expressly 
enumerated in the plain language of the finalized regulations. 
Specifically, the Preamble to the SAFE I final rule unequivocally 
stressed that ``state programs to limit or prohibit tailpipe GHG 
emissions or establish ZEV mandates are preempted,'' \85\ and that the 
SAFE I Rule was a ``final decision from the agencies that States do not 
have the authority to set GHG standards or establish ZEV mandates.'' 
\86\ At the same time, the Preamble also contained other statements in 
which the Agency's position is described more as an interpretation of 
the scope of Section 32919. For instance, NHTSA articulated in the 
Preamble a ``view . . . that ZEV mandates are preempted by EPCA'' \87\ 
The intermittent manner in which the Agency described the force of 
preemption in the Preamble intermingled any interpretative statements 
regarding Section 32919 with the more binding definitions of preemption 
the Agency sought to make in the Appendices. The Agency is also 
concerned that the manner in which the Preamble described the Agency's 
role with respect to EPCA preemption does not accurately reflect the 
limits to the Agency's preemption authority described in the preceding 
section.
---------------------------------------------------------------------------

    \85\ Id. at 51311.
    \86\ Id.
    \87\ Id. at 51314.
---------------------------------------------------------------------------

2. Repealing All Aspects of the SAFE I Rule Provides the Agency With a 
Clean Slate on This Issue

    Further, repealing all aspects of the SAFE I Rule will restore the 
Agency to a clean slate to appropriately exercise its interpretative 
discretion on matters of EPCA preemption. In this respect, the Agency 
is mindful that an ``administrative interpretation [which] alters the 
federal-state framework by permitting federal encroachment upon a 
traditional state power'' merits particularly careful consideration to 
fully account for the significant federalism interests of states.\88\ 
Likewise, Executive Order 13132 recognizes the importance of 
considering federalism interests, stressing that ``[t]he national 
government should be deferential to the States when taking action that 
affects the policymaking discretion of the States and should act only 
with the greatest caution where State or local governments have 
identified uncertainties regarding the constitutional or statutory 
authority of the national government.'' \89\ Here, states have 
indicated that the standards at issue were developed to protect the 
states' residents from dangerous air pollution and the states' natural 
resources from the threats posed by climate change. In a number of 
cases, these policies also served as components of the states' 
compliance with air pollution mitigation requirements delegated to 
states under the Federal Clean Air Act.
---------------------------------------------------------------------------

    \88\ See Solid Waste Agency of N. Cook Cty. v. U.S. Army Corps 
of Engineers, 531 U.S. 159, 173 (2001).
    \89\ Executive Order 13132, Federalism, Sec. 1(a) (Aug. 4, 
1999).
---------------------------------------------------------------------------

    Upon reconsideration, NHTSA is concerned that the categorical 
preemption views announced in the SAFE I Rule were insufficiently 
tailored to account for these federalism interests because they label 
an entire segment of state and local regulation as preempted, 
irrespective of the precise contours of any particular programs, 
regulations, or technological developments that may arise. This is not 
to say that the Agency cannot approach the question of whether a 
particular state or local law is preempted without certain general 
principles or overarching views, either at the time it is considering a 
particular matter or in an advance advisory opinion, but it is entirely 
different to declare that such general views are incontrovertible or 
absolute in a way that does not account for the nuanced and careful 
consideration of program-specific facts called for in preemption 
analyses.
    Thus, the Agency believes that a clean slate would more 
appropriately enable a particularized consideration of how the 
specifics of state programs may ``relate to'' fuel economy standards 
under Section 32919. Such an approach would be more reflective of the 
importance of federalism concerns and of the kind of program-specific 
factual inquiry often involved in identifying whether a state program 
is preempted under the statute. This type of factual, case-specific 
approach is consistent with how courts generally consider both the 
application of express preemption provisions and, even more so, claims 
of implied conflict preemption. Such courts remain available to resolve 
issues that may arise in the context of applying EPCA preemption, such 
as in legal challenges to particular state programs. In fact, should 
such a legal challenge arise, this narrower approach affords a better 
opportunity to provide to the presiding court, if appropriate, a more 
tailored and relevant perspective on the Agency's view of whether the 
state law at issue is preempted. To the extent NHTSA sets forth any 
such advisory views of how EPCA preemption may affect state programs, 
considering those programs in a more specific and narrow context also 
enables the Agency to more fully leverage its automotive expertise in 
understanding the particular vehicle technologies implicated by the 
respective regulations. These same advantages also apply if the Agency 
elects, as appropriate, to provide similar views outside of the 
litigation context as well. The clean slate facilitated by this 
approach is fully consistent with NHTSA's previous approach to EPCA 
preemption.
    In contrast, establishing a clean slate and clearly communicating 
that NHTSA's views on EPCA preemption, while advisory, do not 
independently preempt, encourages states and political subdivisions to 
more freely devise programs that can potentially coexist with Section 
32919. Therefore, the Agency is concerned that retaining the views 
announced in the SAFE I Rule, and categorically foreclosing 
consideration of any such programs that states may otherwise pursue, 
unnecessarily and inappropriately restricts potential policy innovation 
at the State and local level.

[[Page 25990]]

    Further, the Agency believes that repealing all aspects of the SAFE 
I Rule and restoring a clean slate is appropriate because the Agency 
has substantial doubts about the substantive EPCA preemption 
conclusions reached in the SAFE I Rule. The proposal, final rule, and 
ensuing litigation for the SAFE I Rule generated an extensive array of 
public comments, scholarship, and legal briefing regarding both the 
procedural and substantive matters of EPCA preemption. While NHTSA is 
not announcing any new substantive views regarding EPCA preemption in 
this document, the Agency recognizes that many of these writings raised 
very detailed and thorough arguments advocating for a different reading 
and application of Section 32919 than was adopted by NHTSA in the SAFE 
I Rule.\90\
---------------------------------------------------------------------------

    \90\ For instance, in 2019 and 2020, Professor Greg Dotson with 
the University of Oregon School of Law published two law review 
articles dedicated entirely to the Agencies' SAFE I rulemaking. In 
these articles, Professor Dotson comprehensively analyzed applicable 
legislative and regulatory history, before suggesting that Congress 
did not intend to preempt state GHG standards or ZEV mandates under 
Section 32919. Similar conclusions have been reached by other 
commenters and litigants in the SAFE I rulemaking and consolidated 
litigation.
---------------------------------------------------------------------------

    Although the Agency does not propose to adopt any substantive views 
in this proposal, NHTSA acknowledges that these substantive arguments 
merit careful consideration and raise significant doubts for the Agency 
as to the validity of the positions taken in SAFE I. As long as the 
SAFE I Rule statements remain in place, any opportunity for a more 
nuanced consideration of particular state programs is significantly 
diminished. Moreover, if they remained in place, the SAFE I views would 
inaccurately suggest that the Agency remained certain about substantive 
issues for which, in reality, the Agency harbored significant doubts 
and continued to reconsider. Accordingly, NHTSA preliminarily believes 
that even if it does not yet wish to articulate new substantive views, 
withdrawing any interpretations from the SAFE I Rule is a necessary and 
appropriate next step to ensure the Agency can fully exercise its 
interpretative and policymaking discretion to do so in a more nuanced 
and careful way at a later point, if warranted.
    Due to these concerns, the Agency has tentatively determined that 
it is appropriate to first repeal the interpretative positions, rather 
than also to include a new interpretation in this proposal, as doing so 
enables the most efficient and streamlined removal of NHTSA's express 
preemption regulations. If the Agency finalizes its view that the 
express preemption regulations in parts 531 and 533 indeed exceed 
NHTSA's delegated authority, repealing the ultra vires regulations 
quickly is imperative to restore NHTSA's regulations to their properly 
authorized scope, which remains NHTSA's paramount objective in this 
proposal. In contrast, broadening the scope of this proposal to include 
new substantive interpretations regarding EPCA's application to state 
motor vehicle emissions regulations may significantly expand both the 
purview of the Agency's analysis and the scope of public input on the 
proposal, and the time needed to complete this action. Therefore, 
repealing but not replacing the Agency's substantive views on 
preemption provides the additional time needed to fully reconsider the 
issue without leaving any implication that the statements in the SAFE I 
rulemaking remain in effect or inappropriately dampening state 
regulatory activity in the interim.
    Accordingly, NHTSA is proposing to fully withdraw any 
interpretative statements or views espoused in the Preambles of the 
SAFE I Rule to ensure that no ambiguity exists regarding whether the 
Agency continues to endorse such statements. Such a rescission and 
repeal offers the opportunity to establish a clean slate, in which no 
prior overstatements as to NHTSA's role lead to confusion about a 
party's legal obligations or the weight the Agency's statements should 
carry and no interpretative statements with which the Agency may no 
longer agree could influence state actions.

G. Repealing the Regulations and Positions Announced in the SAFE I 
Rulemaking Remains Appropriate Even if NHTSA Possessed the Authority 
for the Rulemaking

    Even apart from the Agency's substantial concerns discussed above, 
the Agency is also proposing a complete repeal of the codified 
provisions and interpretative views as independently worthwhile steps. 
Upon reconsideration, even if it could do so lawfully, NHTSA no longer 
deems it necessary to speak with the force and effect of law on matters 
of EPCA preemption.
    At the outset, the Agency considers the codified text in Sec. Sec.  
531.7 and 533.7 unnecessary, as they merely repeat the statutory text 
and, thus, have no effect beyond the statute simply by virtue of their 
codification in NHTSA's regulations. In fact, NHTSA is concerned that 
their verbatim recitation in the CFR could even be confusing to some, 
who assume some subtle difference must exist in the statutory and 
regulatory provisions. As such, the Agency no longer considers the two 
provisions to offer any utility and proposes their repeal. As for the 
remaining two Appendices and associated Preamble text, the Agency 
remains concerned that, even if NHTSA possessed authority for the 
rulemaking, the categorical manner in which the SAFE I Rule applied 
preemption does not appropriately account for the importance of a more 
nuanced approach that considers state programs on a more particularized 
basis. NHTSA believes this more nuanced approach could better balance 
federalism interests by avoiding a sweeping and premature prohibition 
of all state and local programs and instead evaluating such programs 
more specifically. Further, NHTSA now has significant doubts about the 
validity of its preemption analysis as applied to the specific state 
programs discussed in SAFE I. Therefore, for both these reasons and the 
further discussion on the subject that appears in the preceding 
section, NHTSA considers a proposal to repeal the regulations and 
interpretations appropriate irrespective of the Agency's level of 
authority on preemption.

H. Rulemaking Analyses and Notices

1. Executive Order 12866, Executive Order 13563, and DOT Regulatory 
Policies and Procedures

    NHTSA has considered the impact of this rulemaking action under 
Executive Order 12866, Executive Order 13563, and the Department of 
Transportation's regulatory policies and procedures. This rulemaking 
document has been considered a ``significant regulatory action'' under 
Executive Order 12866. At this stage, NHTSA does not believe that this 
rulemaking would be ``economically significant,'' as it would not 
directly reinstate any state programs or otherwise affect the self-
executing statutory preemption framework in 49 U.S.C. 32919.

2. Regulatory Flexibility Act

    Pursuant to the Regulatory Flexibility Act (5 U.S.C. 601 et seq., 
as amended by the Small Business Regulatory Enforcement Fairness Act 
(SBREFA) of 1996), whenever an agency is required to publish a notice 
of proposed rulemaking or final rule, it must prepare and make 
available for public comment a regulatory flexibility analysis that 
describes the effect of the rule on small entities (i.e., small 
businesses, small organizations, and small governmental

[[Page 25991]]

jurisdictions). No regulatory flexibility analysis is required, 
however, if the head of an agency certifies the proposal will not have 
a significant economic impact on a substantial number of small 
entities.
    NHTSA has considered the impacts of this document under the 
Regulatory Flexibility Act and certifies that this rulemaking will not 
have a significant economic impact on a substantial number of small 
entities. The following provides the factual basis for this 
certification under 5 U.S.C. 605(b). This proposed action would only 
concern the question of preemption; the action does not set CAFE or 
emissions standards themselves. The preemption regulations at issue in 
this proposal have no direct effect on any private entities, regardless 
of size, because the rules do not regulate private entities. Thus, any 
effect on entities implicated by this regulatory flexibility analysis 
is merely indirect.

3. Executive Order 13132 (Federalism)

    Executive Order 13132 requires NHTSA to develop an accountable 
process to ensure ``meaningful and timely input by State and local 
officials in the development of regulatory policies that have 
federalism implications.'' \91\ ``Policies that have federalism 
implications'' is defined in the Executive order to include regulations 
that have ``substantial direct effects on the States, on the 
relationship between the national government and the States, or on the 
distribution of power and responsibilities among the various levels of 
government.'' \92\ Executive Order 13132 imposes additional 
consultation requirements on two types of regulations that have 
federalism implications: (1) A regulation that imposes substantial 
direct compliance costs, and that is not required by statute; and (2) a 
regulation that preempts State law.\93\
---------------------------------------------------------------------------

    \91\ Executive Order 13132, Federalism, Sec. 1(a) (Aug. 4, 
1999).
    \92\ Id. at Sec. 1(a).
    \93\ Id. at Sec. 6(b), (c).
---------------------------------------------------------------------------

    While this proposal concerns matters of preemption, it does not 
propose either type of regulation covered by Executive Order 13132's 
consultation requirements. Rather, the action in this proposal 
expressly proposes to repeal regulations and positions that sought to 
preempt State law. Thus, this proposal does not implicate the 
consultation procedures that Executive Order 13132 imposes on agency 
regulations that would either preempt state law or impose substantial 
direct compliance costs on states.

4. Unfunded Mandates Reform Act of 1995

    The Unfunded Mandates Reform Act of 1995, Public Law 104-4, 
requires agencies to prepare a written assessment of the cost, benefits 
and other effects of proposed or final rules that include a Federal 
mandate likely to result in the expenditure by State, local, or tribal 
governments, in the aggregate, or by the private sector, of more than 
$100 million annually. Because this rulemaking is not expected to 
include a Federal mandate, no unfunded mandate assessment will be 
prepared.

5. National Environmental Policy Act

    The National Environmental Policy Act of 1969 (NEPA) \94\ directs 
that Federal agencies proposing ``major Federal actions significantly 
affecting the quality of the human environment'' must, ``to the fullest 
extent possible,'' prepare ``a detailed statement'' on the 
environmental impacts of the proposed action (including alternatives to 
the proposed action).\95\ However, there are some instances where NEPA 
does not apply to a particular proposed action.
---------------------------------------------------------------------------

    \94\ 42 U.S.C. 4321-4347.
    \95\ 42 U.S.C. 4332.
---------------------------------------------------------------------------

    One consideration is whether the action is a non-discretionary 
action to which NEPA may not apply.\96\ In this document, NHTSA has 
expressed its substantial concerns over whether Congress provided 
legislative rulemaking authority to the Agency with regard to 49 U.S.C. 
32919. To the extent that the SAFE I Rule purported to dictate or 
proclaim EPCA preemption with the force of law, the Agency expresses a 
concern throughout this proposal that such actions exceed the 
Congressional grant of authority to NHTSA under EPCA. If NHTSA in fact 
exceeded its authority, the Agency believes that the only legally 
appropriate course of action would be to realign its regulatory 
activities to their properly authorized scope by removing the 
regulatory language and appendices from the Code of Federal Regulations 
and repealing the corresponding analysis of particular state GHG 
emissions programs in the SAFE I Rule. Courts have long held that NEPA 
does not apply to nondiscretionary actions by Federal agencies.\97\ If 
NHTSA were to conclude in its final rule that it lacked authority to 
issue regulations mandating preemption or otherwise categorically 
proclaiming state regulations to be preempted, it must therefore 
conclude that NEPA does not apply to this action.
---------------------------------------------------------------------------

    \96\ See Dept. of Transp. v. Public Citizen, 541 U.S. 752, 768-
69 (2014) (holding that the agency need not prepare an environmental 
impact statement (EIS) in addition to an environmental assessment 
(EA) and stating, ``Since FMCSA has no ability categorically to 
prevent the cross-border operations of Mexican motor carriers, the 
environmental impact of the cross-border operations would have no 
effect on FMCSA's decisionmaking--FMCSA simply lacks the power to 
act on whatever information might be contained in the EIS.'').
    \97\ See, e.g., Public Citizen, 541 U.S. 752; Milo Cmty. Hosp. 
v. Weinberger, 525 F.2d 144 (1st Cir. 1975); State of South Dakota 
v. Andrus, 614 F.2d 1190 (8th Cir. 1980); Citizens Against Rails-to-
Trails v. Surface Transp. Bd., 267 F.3d 1144 (D.C. Cir. 2001); 
Sierra Club v. Babbitt, 65 F.3d 1502 (9th Cir. 1995).
---------------------------------------------------------------------------

    The Agency also notes that the Supreme Court has characterized an 
express preemption statue's scope as a legal matter of statutory 
construction, in which ``the purpose of Congress is the ultimate 
touchstone of pre-emption analysis.'' Cipollone v. Liggett Grp., Inc., 
505 U.S. 504, 516 (1992). In turn, ``Congress' intent, of course, 
primarily is discerned from the language of the pre-emption statute and 
the `statutory framework' surrounding it.'' Lohr, 518 U.S. at 485-86 
(plurality opinion). This particularly applies ``[i]f the statute 
contains an express pre-emption clause[. Then] the task of statutory 
construction must in the first instance focus on the plain wording of 
the clause, which necessarily contains the best evidence of Congress' 
pre-emptive intent.'' CSX Transp., Inc. v. Easterwood, 507 U.S. 658, 
664 (1993).
    In light of this background, as both this proposal and the SAFE I 
Rule itself consistently made clear, the statutory text of 49 U.S.C. 
Section 32919 governs express preemption through self-executing terms. 
Specifically, the Preamble to the SAFE I Final Rule stressed that 
``[a]ny preemptive effect resulting from this final action is not the 
result of the exercise of Agency discretion, but rather reflects the 
operation and application of the Federal statute.'' \98\ NHTSA asserted 
that it did not have authority to waive any aspect of EPCA preemption 
no matter the potential environmental impacts; rather, ``preempted 
standards are void ab initio.'' \99\ On this basis, the Agency 
concluded that NEPA did not apply to its action.
---------------------------------------------------------------------------

    \98\ 84 FR 51310, 51353-54.
    \99\ Id. at 51354.
---------------------------------------------------------------------------

    In this document, NHTSA does not seek to take any new substantive 
step or announce any new substantive view. Instead, NHTSA proposes only 
to withdraw the SAFE I Rule, which was an action for which the Agency 
already determined NEPA did not apply as the operative statute 
continued to govern any environmental effects from preemption. As 
before, the express preemption provision of Section 32919

[[Page 25992]]

remains enacted, in full and unchanged, irrespective of the SAFE I 
Rule, this proposal, or any subsequent final rule. As such, even though 
NHTSA now expresses doubts about its substantive conclusions in the 
SAFE I Rule and proposes to withdraw those views here, the Agency 
continues to believe that it did not and cannot dictate or define by 
law the self-executing scope of preemption under Section 32919. This is 
because of the Agency's belief expressed herein that its views on 
Section 32919, while potentially informative and advisory, do not carry 
the force and effect of law.\100\ Therefore, this proposal likewise 
would not change the statutorily set scope of express preemption and, 
as such, the Agency does not consider this proposal to result in any 
environmental impact that may arise from such preemption.
---------------------------------------------------------------------------

    \100\ See supra Sec. E(3). If NHTSA did, in fact, have authority 
to establish the scope of preemption with the force and effect of 
law, and if the Agency inappropriately failed to incorporate 
environmental considerations into its decision in the SAFE I Rule, 
then establishing a clean slate and restoring the scope to the 
status quo ante would rectify this overstep. See, e.g., supra Sec. 
F(2). In the event NHTSA is adjudged to possess such binding 
authority and decides to exercise it in a future rulemaking, such a 
clean state will allow NHTSA to include such environmental 
considerations, if appropriate, at that time.
---------------------------------------------------------------------------

6. Executive Order 12988 (Civil Justice Reform)

    Pursuant to Executive Order 12988, ``Civil Justice Reform,'' \101\ 
NHTSA has determined that this proposed rule does not have any 
retroactive effect.
---------------------------------------------------------------------------

    \101\ 61 FR 4729 (Feb. 7, 1996).
---------------------------------------------------------------------------

7. Paperwork Reduction Act

    In accordance with the Paperwork Reduction Act of 1980, NHTSA 
states that there are no requirements for information collection 
associated with this rulemaking action.

8. Privacy Act

    Please note that anyone is able to search the electronic form of 
all comments received into any of DOT's dockets by the name of the 
individual submitting the comment (or signing the comment, if submitted 
on behalf of an association, business, labor union, etc.). You may 
review DOT's complete Privacy Act Statement in the Federal Register 
published on April 11, 2000 (Volume 65, Number 70; Pages 19477-78), or 
you may visit http://dms.dot.gov.

List of Subjects in 49 CFR Parts 531 and 533

    Fuel economy.

Proposed Regulatory Text

    For the reasons stated in the preamble, the National Highway 
Traffic Safety Administration proposes to amend 49 CFR parts 531 and 
533 as set forth below.

PART 531--PASSENGER AUTOMOBILE AVERAGE FUEL ECONOMY STANDARDS

0
1. The authority citation for part 531 continues to read as follows:

    Authority:  49 U.S.C. 32902; delegation of authority at 49 CFR 
1.95.


Sec.  531.7  [Removed]

0
2. Remove Sec.  531.7.

Appendix B [Removed]

0
3. Remove appendix B to part 531.

PART 533--LIGHT TRUCK FUEL ECONOMY STANDARDS

0
4. The authority citation for part 533 continues to read as follows:

    Authority:  49 U.S.C. 32902; delegation of authority at 49 CFR 
1.95.


Sec.  533.7  [Removed]

0
5. Remove Sec.  533.7.

Appendix B [Removed]

0
6. Remove appendix B to part 533.

    Issued on April 22, 2021, in Washington, DC, under authority 
delegated in 49 CFR 1.81, 1.95, and 501.4
Steven S. Cliff,
Acting Administrator.
[FR Doc. 2021-08758 Filed 5-11-21; 8:45 am]
BILLING CODE 4910-59-P


