EPA’s Removal of the Opt-Out provision upheld in Circuit Court

D.C. Circuit Upholds EPA’s Removal of the Opt-Out Provision

The U.S. Court of Appeals for the D.C. Circuit has ruled that the decision by the Environmental Protection Agency (EPA) to remove the “opt-out” provision from its lead paint rule is legal.

While NAHB is disappointed with the decision, the association continues to work with Congress to reinstate the opt-out provision.

The opt-out provision would allow remodelers working in a home built prior to 1978 to forego more expensive work practices according to the owner’s wish if no children under the age of six or pregnant women resided there.

The EPA included the opt-out provision in the original 2008 Lead: Renovation, Repair and Painting Program Rule(LRRP Rule), but later agreed to remove the provision to resolve a legal challenge against the rule.

When the EPA finalized the removal of the opt-out provision in 2010, this more than doubled the number of homes subject to the LRRP Rule. The agency has estimated that this will add more than $500 million per year to the cost of the regulation.

NAHB, leading a coalition of industry trade groups, filed a petition for review in the D.C. Circuit Court of Appeals challenging the removal of the opt-out. The other groups in the coalition include the Hearth, Patio and Barbecue Association, the National Lumber and Building Material Dealers Association, and the Window and Door Manufacturers Association.

On June 22, the court issued its decision in favor of the EPA. The court found that federal agencies may change existing regulations so long as the amended rule is allowed by the statute and the agency acknowledges the change in course. In the case of the opt-out, the court found that since the EPA was not obligated to include an opt-out provision in the LRRP Rule, it could remove the provision without offering new information to justify its removal.

The court clearly understood the motivations behind the EPA’s sudden change of heart.  In concluding the court’s opinion, Judge Merrick Garland wrote: “[T]here were…two…events of note…that go a long way toward explaining why EPA reconsidered the opt-out provision: namely, the inauguration of a new President and the confirmation of a new EPA Administrator.”

Though the court’s decision is not entirely unexpected, NAHB remains hopeful that legislation in both the House and Senate (H.R. 5911 and S. 2148) will ultimately lead to the reinstatement of the opt-out provision.

For more information on the court’s ruling, email Amy Chai at NAHB or call her at 800-368-5242 x8232.