October 28

October 28, 2019: Corn Advocates Claim Court-Driven SRE Process Lacks Transparency While Big Ag Subsidies Stay Dark

Tomorrow, the House Energy and Commerce Environment Subcommittee will hold a hearing allegedly addressing transparency concerns related to the renewable fuel standard, or RFS. But by targeting legally-required small refinery exemptions (SREs), they are missing the bigger picture.

First, SREs are required for qualifying facilities under the Clean Air Act and applicable regulations. In cases where EPA has attempted to use alleged discretion to restrict SREs when refineries can demonstrate disproportionate economic harm, courts have ruled against the Agency three times. This year, Administrator Wheeler confirmed this fact in testimony before Congress. As Wheeler has noted previously, “the small refinery exemption program is authorized under the law. EPA was not implementing it, and we were sued three times and we lost three times. And we received appropriations language directing us to implement the small refinery exemptions program and we are. We will continue to follow the law.”  

Second, this EPA has been the most transparent of any EPA about the nature and considerations of SREs—while still respecting the required boundaries of confidential business information. As Wheeler promised before the Senate in August 2018: “We are creating a dashboard where we will publicize all the information about when we grant a waiver and circumstances around the waiver,” he said. “We have to balance that with the confidential business information that will be impacting companies. But, we are working to try to be more transparent on that side of the program.”  

EPA delivered on that promised transparency. In an April 2019 interview, Wheeler noted: “We've created the dashboard last fall where we're putting our information out in real-time on the small refinery waivers program and we're being more upfront about what we're doing and why we're doing it.”

More on the dashboard can be found here.  

Third, by contrast to the relatively open Clean Air Act process, much of the regulatory structure under which large agri-business is subsidized remains shrouded in secrecy. Consider these clear third-party analyses:

  • Center for Progressive Reform: “Each year, agricultural producers in the United States receive billions of dollars in federal subsidies, crop insurance, conservation payments, and other grants. Defying fundamental principles of good government that apply to other federal programs, the U.S. Department of Agriculture (USDA) is authorized to keep secret much of the basic information farmers provide to qualify for these grants.” 
  • Environmental Working Group: “Crop insurance has largely replaced the ad hoc relief programs authorized by Congress in response to disasters. Crop insurance has come under attack for its increasing cost, environmental impacts and secrecy.”
  • Sunlight Foundation: “Environmental, conservative and taxpayer groups such as EWG, the Heritage Foundation and Taxpayers for Common Sense have been fiercely critical of the crop insurance program, both for the taxpayer subsidies it provides to farmers and the program’s secrecy.” 
  • Taxpayers for Common Sense: “Transparency is a fundamental tenet of democracy and good governance. Taxpayers deserve to know where their tax dollars are going and who benefits from public spending. USDA must monitor and measure whether programs are achieving their intended goals. USDA must increase communication and collaboration within the agency, with project partners and taxpayers, in order to maximize public benefits.”

Last, USDA itself has played a secret role in lobbying the RFS program generally and the SRE program specifically, even though under the Clean Air Act, USDA is not the Agency specified for collaboration with EPA. Far from being transparent, USDA is now being sued under FOIA and is subject to lengthy ethics review for the role it has been playing. See a summary here.

With these facts in mind, we hope those interested in the RFS and the broader context of agricultural and energy policy start to ask the right questions regarding transparency. To those who do, the big agri-business side is more likely to be seen as opaque, if it can be seen at all!