State Agency Spending $350,000 to Implement Environmental Regulation Blocked by Supreme Court

The Minnesota Pollution Control Agency is spending hundreds of thousands of taxpayer dollars to comply with controversial federal greenhouse gas regulations that have been temporarily blocked by the US Supreme Court and may never be implemented.

Last month, twenty-seven states concerned about federal government overreach and the economic consequences of the Clean Power Plan successfully sued to stop the Environmental Protection Agency from enforcing the climate change regulations until their legal challenges are resolved.

But MPCA officials responding to a CAE inquiry indicated the agency will spend more than $350,000 this fiscal year anyway, moving full speed ahead “reviewing and planning” for a sweeping rule that calls for a 42 percent reduction in carbon emissions in state power plants.

It’s the first estimate of the annual taxpayer cost of Gov. Mark Dayton’s decision, over Republican legislators’ objections, to voluntarily proceed with the far-reaching EPA regulations.

“We still think the rule is a valid rule and that the courts will eventually find that this will be the way states will approach the performance standards for the electricity system and carbon emissions,” said Frank Kohlasch, Section Manager of MPCA’s Environmental Analysis and Outcome Division. “We want to be prepared for whatever eventuality may come out of the judicial system.”

Opponents argue that the state, utilities and businesses could be wasting millions of dollars on a regulation that may be bogged down for years in the courts and ultimately overturned. But in the long run, the greatest cost would be borne by ratepayers in the form of significantly higher electric bills.

“The financial implications are going to be extensive and far-reaching. We’re not going to get out from under this. It’s going to cost us a lot of money. Your number of $300,000 or $400,000, I think that’s just the cherry on top of the sundae,” said Rep. Jim Newberger, R-Becker. Newberger’s district includes two coal-fired power plants set to be closed under the plan.

Since the Supreme Court froze nationwide implementation of the administrative action on February 9, the MPCA reports spending more than $47,000 on public meetings across Minnesota. Some of the public listening sessions were already booked prior to the court action.

Agency staff dedicated some 820 hours to the project at a taxpayer cost of $44,000. Room rental, refreshments and ancillary materials for public meetings that drew between 50 and 100 attendees totaled $3,260.

“That’s higher than what a normal month would be, just because we had all of those stakeholder, public listening sessions planned,” Kohlasch said. “So we had more people out traveling to places like Bemidji, Duluth, Marshall and being available to the public.”

Yet most of Minnesota’s neighboring states have moved decisively to suspend work on the Clean Air Act regulations. The case goes before a federal appeals court in Washington, DC in June with both sides predicting lengthy litigation unlikely to reach the Supreme Court until a year or more from now.

“I can’t imagine why one would want to spend taxpayer dollars on something that may or may not ultimately be legally valid. In South Dakota, I can’t justify doing that and certainly we’re not going to here,” said Chris Nelson, Chair of the South Dakota Public Utilities Commission.

Overall, 20 states have suspended action, while 19 states continue to pursue the CPP, according to Environment and Energy Publishing.

“We’re very aware that other states aren’t working on it at all or not as quickly. We continue to look at our workload and what makes sense for us to continue to prepare,” Kohlasch said.

Meantime, climate regulators oppose a bill with bipartisan support to give the Minnesota Legislature final approval over the MPCA greenhouse gas plan. At least seven DFL legislators have co-sponsored HF 333, which recently passed the House Ways and Means Committee with two DFL votes. The DFL co-sponsors did not respond to requests for comment.

“The whole thing is truly about the state having a right to choose and having a final say in a matter that is a federal mandate that bypasses the legislative process,” said Rep. Newberger, the bill’s author. “And I think there are a number of Democrats that recognize this. They want to be able to weigh in on the final plan as legislators.”

(Full Time Equivalent)
Staff Coordinator 0.8
Staff Engineer 0.75
Staff Analyst 0.25
Staff Outreach 0.2
Staff Rule Coordinator 0.1
Staff Communications 0.1
Leadership Supervisor 0.2
Leadership Director 0.1
Leadership Manager 0.4
Leadership Commissioner’s Office 0.4
TOTAL Full Time Equivalent (FTE) 3.3

*Based on MPCA’s standard salary + fringe + indirect value ($108,000/year/FTE) used for fiscal notes to the legislature.

$  356,400*