[Federal Register Volume 84, Number 188 (Friday, September 27, 2019)]
[Rules and Regulations]
[Pages 51310-51363]
[FR Doc No: 2019-20672]

Vol. 84

Friday,

No. 188

September 27, 2019

Part III

Environmental Protection Agency

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40 CFR Parts 85 and 86

Department of Transportation

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National Highway Traffic Safety Administration

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49 CFR Parts 531 and 533

The Safer Affordable Fuel-Efficient (SAFE) Vehicles Rule Part One: One
National Program; Final Rule

Federal Register / Vol. 84 , No. 188 / Friday, September 27, 2019 /
Rules and Regulations

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Parts 85 and 86

DEPARTMENT OF TRANSPORTATION

National Highway Traffic Safety Administration

49 CFR Parts 531 and 533

[NHTSA-2018-0067; EPA-HQ-OAR-2018-0283; FRL 10000-45-OAR]
RIN 2127-AL76; 2060-AU09

The Safer Affordable Fuel-Efficient (SAFE) Vehicles Rule Part
One: One National Program

AGENCY: Environmental Protection Agency and National Highway Traffic
Safety Administration, Department of Transportation.

ACTION: Withdrawal of waiver; final rule.

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SUMMARY: On August 24, 2018, the Environmental Protection Agency (EPA)
and the Department of Transportation's National Highway Traffic Safety
Administration (NHTSA) jointly published in the Federal Register a
notice of proposed rulemaking entitled, ``The Safer Affordable Fuel-
Efficient (SAFE) Vehicles Rule for Model Years 2021-2026 Passenger Cars
and Light Trucks.'' In the NPRM, the agencies proposed new and amended
greenhouse gas (GHG) and Corporate Average Fuel Economy (CAFE)
standards for model year 2021 to 2026 light duty vehicles. EPA also
proposed to withdraw the waiver it had previously provided to
California for that State's GHG and ZEV programs under section 209 of
the Clean Air Act. NHTSA also proposed regulatory text implementing its
statutory authority to set nationally applicable fuel economy standards
that made explicit that those State programs would also be preempted
under NHTSA's authorities. In this action, the agencies finalize the
two actions related to the waiver and preemption. Accordingly, in this
document: EPA announces its decision to withdraw the waiver; and NHTSA
finalizes regulatory text related to preemption. The agencies
anticipate issuing a final rule on standards proposed in the NPRM in
the near future.

DATES: This joint action is effective November 26, 2019.
    Judicial Review: Pursuant to Clean Air Act section 307(b), any
petitions for judicial review of this action must be filed in the
United States Court of Appeals for the D.C. Circuit by November 26,
2019. Given the inherent relationship between the agencies' actions,
any challenges to NHTSA's regulation should also be filed in the United
States Court of Appeals for the D.C. Circuit. See also Sections III.G
and IV.Q of this preamble.

ADDRESSES: EPA and NHTSA have established dockets for this action under
Docket ID No. EPA-HQ-OAR-2018-0283 and NHTSA 2018-0067, respectively.
All documents in the docket are listed in the http://www.regulations.gov index. Although listed in the index, some
information is not publicly available, e.g., confidential business
information (CBI) or other information whose disclosure is restricted
by statute. Certain other material, such as copyrighted material, will
be publicly available in hard copy in EPA's docket, and electronically
in NHTSA's online docket. Publicly available docket materials can be
found either electronically in www.regulations.gov by searching for the
dockets using the Docket ID numbers above, or in hard copy at the
following locations: EPA: EPA Docket Center, EPA/DC, EPA West, Room
3334, 1301 Constitution Ave. NW, Washington, DC. The Public Reading
Room is open from 8:30 a.m. to 4:30 p.m., Monday through Friday,
excluding legal holidays. The telephone number for the Public Reading
Room is<PHONE_NUMBER>. NHTSA: Docket Management Facility, M-30, U.S.
Department of Transportation (DOT), West Building, Ground Floor, Rm.
W12-140, 1200 New Jersey Avenue SE, Washington, DC 20590. The DOT
Docket Management Facility is open between 9 a.m. and 5 p.m. Eastern
Time, Monday through Friday, except Federal holidays.

FOR FURTHER INFORMATION CONTACT:
    EPA: Christopher Lieske, Office of Transportation and Air Quality,
Assessment and Standards Division, Environmental Protection Agency,
2000 Traverwood Drive, Ann Arbor, MI 48105; telephone number: (734)
214-4584; fax number:<PHONE_NUMBER>; email address:
<EMAIL_ADDRESS>or contact the Assessment and Standards
Division, email address<EMAIL_ADDRESS>    NHTSA: James Tamm, Office of Rulemaking, Fuel Economy Division,
National Highway Traffic Safety Administration, 1200 New Jersey Avenue
SE, Washington, DC 20590; telephone number:<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION:

I. Overview
II. Preemption Under the Energy Policy and Conservation Act
III. EPA's Withdrawal of Aspects of the January 2013 Waiver of CAA
section 209(b) Preemption of the State of California's Advanced
Clean Car Program
IV. Regulatory Notices and Analyses

I. Overview

    On August 24, 2018, the Environmental Protection Agency (EPA) and
the Department of Transportation's National Highway Traffic Safety
Administration (NHTSA) (collectively, ``the agencies'') jointly
published in the Federal Register a notice of proposed rulemaking
entitled, ``The Safer Affordable Fuel-Efficient (SAFE) Vehicles Rule
for Model Years 2021-2026 Passenger Cars and Light Trucks'' (the SAFE
Vehicles rule).\1\ In the NPRM, EPA proposed new greenhouse gas (GHG)
standards and NHTSA proposed new Corporate Average Fuel Economy (CAFE)
standards for model years (MY) 2021 to 2026 light duty vehicles. The
agencies also proposed to take two actions, separate from the proposed
standards, needed to ensure the existence of one Federal program for
light vehicles. First, EPA proposed to withdraw the waiver it had
previously provided to California for that State's GHG program and Zero
Emissions Vehicle (ZEV) mandate. Second, NHTSA proposed regulatory text
that made explicit that State programs to limit or prohibit tailpipe
GHG emissions or establish ZEV mandates are preempted, to carry out its
statutory authority to set nationally applicable fuel economy standards
and consistent with the express preemption provisions of the Energy
Policy and Conservation Act (EPCA).
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    \1\ 83 FR 42986.
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    The SAFE Vehicles Rule received several hundred thousand public
comments, which discussed in great detail all aspects of the proposal.
The nature of the comments received related to the proposed standards
and the proposed actions on preemption, though, were considerably
different. That is, the vast majority of comments, whether one
considers the number of commenters, the number of issues raised by
commenters, or the length and level of detail of those comments,
focused primarily on the agencies' proposed standards. In contrast, the
comments to the preemption issues, though substantive and thorough,
were fewer in number and length, and raised primarily legal issues,
rather than the technical or economic issues that were the focus of
many comments to the standards. Both the proposed waiver withdrawal and
discussion of EPCA

preemption are legal matters that are independent of the technical
details of the proposed standards and, as such, took up a relatively
small part of the NPRM.
    Recent actions by the State of California taken after the
publication of the NPRM have confirmed the need for final decision from
the agencies that States do not have the authority to set GHG standards
or establish ZEV mandates. First, on December 12, 2018, California
unilaterally amended its ``deemed to comply'' provision, such that
CARB's GHG standards can be satisfied only by complying with EPA's
standards as those standards were promulgated in 2012.\2\ More
recently, on July 25, 2019, California announced a so-called
``voluntary framework'' with four automakers, which purported, without
analysis of the terms of the existing waiver, California law, or how
this ``framework'' is permissible under Federal law, to allow those
automakers to meet reduced standards on a national basis if they
promise not to challenge California's authority to establish GHG
standards or the ZEV mandate.\3\ These two actions, both of which
conflict with the maintenance of a harmonized national fuel economy and
tailpipe GHG emissions program and the terms of the agreement reached
in 2012 and 2013, confirm that the only way to create one actual,
durable national program is for GHG and fuel economy standards to be
set by the Federal government, as was intended by Congress in including
express preemption provisions in both the Clean Air Act (for new motor
vehicle emissions standards) and EPCA (for fuel economy).\4\
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    \2\ See In re: Air Resources Board, Notice of Approval of
Regulatory Action, No. 2018-1114-03 (State of California, Office of
Administrative Law Dec. 12, 2018), available at https://ww3.arb.ca.gov/regact/2018/leviii2018/form400dtc.pdf?_ga=2.183723951.866759811.1568583699-1441462912.1552677736 (last visited Sept. 15, 2019).
    \3\ See California and Major Automakers Reach Groundbreaking
Framework Agreement on Clean Emission Standards, Office of Gov.
Gavin Newsome (July 25, 2019), available at https://www.gov.ca.gov/2019/07/25/california-and-major-automakers-reach-groundbreaking-framework-agreement-on-clean-emission-standards/ (last visited Sept.
14, 2019); Terms for Light-Duty Greenhouse Gas Emissions Standards,
available at https://ww2.arb.ca.gov/sites/default/files/2019-07/Auto%20Terms%20Signed.pdf (last visited Sept. 14, 2019).
    \4\ At the time this joint action was signed, California had not
submitted or demonstrated any intention to submit an application for
a waiver for either its December 2018 amendment to its regulations
or its July 2019 ``framework.''
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    In light of the divergence in the type of comments received to the
proposal (i.e., between the standards-related proposal and the waiver
and preemption proposals), and in light of the recent actions taken by
California, the agencies have determined it is appropriate to move
forward with the two actions related to preemption now, while
continuing work on a final rule to establish the CAFE and GHG standards
that were within the scope of the NPRM. This decision is appropriate,
as agencies have authority to finalize different parts of proposed
actions at different times. Further, the agencies previewed this
possibility in the NPRM by emphasizing the severability of the
standards from the actions being finalized in this document. EPA's
action in this document does not add or amend regulatory text pursuant
to the Clean Air Act and, thus, issuing this decision on the waiver and
the later rulemaking on the standard makes clear the difference between
EPA's two actions and their independence from one another. NHTSA's
action in this document is not to set standards for particular model
years, but rather is an exercise of its authority under 49 U.S.C. 32901
through 32903, necessary to maintain the integrity of the corporate
average fuel economy program and compliance regime established by
Congress as a nationwide program, and consistent with Congress'
statement of express preemption in 49 U.S.C. 32919. These two general
aspects of the SAFE Vehicles Rule are independent of the CAFE and GHG
standards for Model Years 2021-2026.\5\ For that reason, the decision
in this document to finalize the waiver and preemption issues does not
require the agencies to reopen the comment period for the standards, as
it does not have any effect on either agency's standards.
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    \5\ The agencies note that the South Coast Air Quality
Management District commented that EPA should not take an action on
the waiver in the same notice as a rule that would change EPA's GHG
standards. See South Coast Air Quality Management District, Docket
No. NHTSA-2018-0067-11813. Although the agencies do not acknowledge
the validity of this argument, any such concern is rendered moot by
this action.
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    The agencies note that several comments claimed that the comment
period of 63 days was inadequate or that the agencies did not hold a
sufficient number of public meetings. Although the agencies will
address this comment more directly in the forthcoming final rulemaking
to establish standards, for purposes of this action, it is clear to the
agencies that commenters had adequate time to respond to the issue of
the waiver and EPCA preemption. Courts give broad discretion to
agencies in determining whether the length of a comment period is
reasonable and, in assessing the sufficiency of a comment period, look
to whether the public had a meaningful opportunity to comment on a
proposed action. See, e.g., Rural Cellular Ass'n v. FCC, 588 F.3d 1095,
1101 (D.C. Cir. 2009); Connecticut Light & Power Co. v. Nuclear
Regulatory Comm'n, 673 F.2d 525, 534 (D.C. Cir. 1982). There was
unquestionably a meaningful opportunity to comment here. The agencies
received several hundred thousand comments, which included highly
detailed and technical comments on all aspects of the proposal from
seemingly all relevant stakeholders, including numerous comments
related to EPA's action on the waiver and NHTSA's proposal on
preemption. The agencies also note that the NPRM was initially issued
and made public on August 2, 2018, over three weeks prior to
publication in the Federal Register, and received extensive media
coverage immediately thereafter, and giving a total of 86 days to
review and comment. Furthermore, the agencies held three public
hearings during the comment period, including one in Fresno, California
on September 24, 2018, where the agencies heard from several hundred
commenters in person.

II. Preemption Under the Energy Policy and Conservation Act

A. NHTSA Is Finalizing Its Preemption Proposal

    NHTSA is finalizing its proposal concerning preemption of State and
local laws and regulations related to fuel economy standards. Congress
passed EPCA to help achieve the important national objective of
protecting the United States against petroleum price shocks through
improvements in fuel efficiency for the light duty vehicle fleet. But
Congress did not seek to do so at any cost--instead directing the
Secretary of Transportation to balance statutory factors, such as the
need of the nation to conserve energy, technological feasibility, and
economic practicability, to arrive at stringent, but feasible,
standards on a Federal basis.
    Increasing fuel economy is an expensive undertaking for automakers,
the costs of which are necessarily passed on to consumers, thereby
discouraging new vehicle purchases and slowing the renewal of the
nation's light duty fleet. That is why fuel economy standards must be
set considering other critical factors.
    This is also why the notion of national applicability and
preemption of State or local laws or regulations related to fuel
economy standards is so critical. Allowing State or local governments
to establish their own fuel economy standards, or standards related to
fuel

economy, would provide for a universe in which automakers are placed in
the untenable situation of having to expend resources to comply not
only with Federal standards, but also meet separate State requirements.
If State or local governments are allowed to require--directly or
indirectly--automakers to develop and implement additional technologies
to improve fuel economy (or reduce or eliminate tailpipe greenhouse gas
emissions for all or a portion of a fleet), the fuel economy-related
expenses of automakers increase beyond those considered in establishing
federal standards. This would render the critical balancing required by
EPCA devoid of meaning.
    Uniform national fuel economy standards are essential to
accomplishing the goals of EPCA. 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.
    Furthermore, EPCA states: ``When 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.'' 49 U.S.C. 32919(a). As a limited exception, a State or local
government ``may prescribe requirements for fuel economy for
automobiles obtained for its own use.'' 49 U.S.C. 32919(c). 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.'' 49 U.S.C.
32919(b). Absent this limited circumstance, a State or local government
cannot even have laws in place that are identical to the Federal
standards.
    NHTSA will first summarize its discussion of preemption in the
proposal before turning to discussion of issues raised by the comments.
In this final rule, NHTSA fully reaffirms the discussion of preemption
set forth in the proposal, which provides additional detail regarding
NHTSA's views.\6\
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    \6\ See 83 FR 42986, 43232-39 (Aug. 24, 2018).
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    In the proposal, NHTSA described its preemption discussions in
prior rulemakings, which are consistent with the views on preemption
that NHTSA is finalizing in this document.\7\ NHTSA has asserted
preemption of certain State emissions standards under EPCA on multiple
occasions since 2002. The United States explained in a 2002 amicus
brief that EPCA preempted California's then-existing zero-emissions
vehicle (ZEV) regulations.\8\ NHTSA continued the discussion of
preemption later that year in a notice of proposed rulemaking setting
CAFE standards for model year 2005 through 2007 light trucks, and
reiterated its position in the 2003 final rule.\9\ NHTSA's 2005 notice
of proposed rulemaking setting standards for model year 2008 through
2011 light trucks also discussed preemption and the 2006 final rule
elaborated on the issue at length, including in a specific discussion
finding California's then-existing tailpipe greenhouse gas emissions
regulations were preempted.\10\ NHTSA's 2008 proposed rule for model
year 2011 through 2015 passenger cars and light trucks also addressed
preemption and proposed adding a summary of NHTSA's position on the
issue to the Code of Federal Regulations.\11\ That proposed rule also
addressed recent developments, specifically the Supreme Court's
decision in Massachusetts v. EPA, the enactment of EISA, and two
district court decisions finding that State tailpipe greenhouse gas
emissions standards were not preempted by EPCA.\12\ NHTSA explained
that those developments did not change its view of preemption and it
reaffirmed the detailed analysis and conclusions from the 2006 final
rule.\13\ Subsequent CAFE rulemaking documents, prior to the August
2018 proposal, did not discuss EPCA preemption.\14\ Thus, this final
rule is consistent with NHTSA's longstanding position on EPCA
preemption over the course of nearly two decades.
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    \7\ Id. at 43232. As NHTSA noted in the proposal, it had not
previously directly addressed preemption of California's ZEV
program. Id. at 43233.
    \8\ Brief for the United States as Amicus Curiae in Support of
Affirmance, Cent. Valley Chrysler-Plymouth Inc., et al, v. Kenny,
No. 02-16395 (9th Cir. 2002).
    \9\ 68 FR 16868, 16895 (Apr. 7, 2003); 67 FR 77015, 77025 (Dec.
16, 2002). In the notice of proposed rulemaking, NHTSA specifically
rejected the argument made by California in litigation that NHTSA
had not treated EPCA as preempting State efforts to engage in CAFE-
related regulation, explaining that States may not ``issue a
regulation that relates to fuel economy and which addresses the same
public policy concern as the CAFE statute. Our statute contains a
broad preemption provision making clear the need for a uniform,
federal system. . . . The fact that NHTSA had not expressly
addressed this particular aspect of California's requirements should
not have been interpreted as tacit acceptance.'' 67 FR 77015, 77025
(Dec. 16, 2002).
    \10\ 71 FR 17566, 17654-70 (Apr. 6, 2006); 70 FR 51414, 51457
(Aug. 30, 2005).
    \11\ 73 FR 24352, 24478-79 (May 2, 2008). NHTSA finalized only
standards for model year 2011 through that rulemaking action, and
subsequently began a new rulemaking for model year 2012 and later
passenger cars and light trucks. In the final rule for model year
2011, NHTSA stated: ``NHTSA has decided not to include any
provisions addressing preemption in the Code of Federal Regulations
at this time. The agency 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).
    \12\ 73 FR 24352, 24478 (May 2, 2008).
    \13\ Id.
    \14\ As noted above, in NHTSA's final rule for model year 2011,
it stated that ``[t]he agency 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). However, in the NHTSA's
2009 proposal and 2010 final rule setting standards for model year
2012 through 2016 automobiles, NHTSA stated that is was ``deferring
further consideration of the preemption issue.'' 75 FR 25324, 25546
(May 7, 2010); 74 FR 49454, 49635 (Sept. 28, 2009).
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    In the proposal, NHTSA also described certain developments,
including the Supreme Court's decision in Massachusetts v. EPA, that
preceded EPA's regulation of tailpipe greenhouse gas emissions through
joint rulemaking with NHTSA.\15\ In addition, NHTSA described the Obama
Administration's creation of a framework that was intended to allow a
manufacturer to ``meet all standards with a single national fleet.''
\16\ Appeals of the two district court decisions holding that the
California regulation and Federal regulation could co-exist were
withdrawn as part of the negotiated agreement for the National
Program.\17\ The announcement of the framework was followed by EPA's
decision less than two months later to grant a waiver to California for
its own greenhouse gas emissions standards, without taking any
substantive position on EPCA preemption.\18\ The national framework was
a negotiated agreement between the Federal government, California, and
the automotive industry.\19\
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    \15\ 83 FR 42986, 43232-33 (Aug. 24, 2018).
    \16\ Id. at 43233; 76 FR 74854, 74863 (Dec. 1, 2011).
    \17\ See 83 FR 42986, 43233 (Aug. 24, 2018); Association of
Global Automakers, Docket No. NHTSA-2018-0067-12032.
    \18\ In other words, the National Program included State
requirements not nationally applicable. 83 FR 42986, 43233 (Aug. 24,
2018); see also 74 FR 32744, 32783 (July 8, 2009) (``EPA takes no
position regarding whether or not California's GHG standards are
preempted under EPCA.'').
    \19\ After President Obama announced the agreement, NHTSA and
EPA subsequently adopted CAFE and greenhouse gas emissions standards
through rulemaking. See 75 FR 25324 (May 7, 2010).
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    NHTSA confirms its view, stated in the proposal on preemption, that
the agencies' consideration in 2012 of California's ``deemed to
comply''

regulatory provision as obviating NHTSA's consideration of preemption
was erroneous.\20\ This, too, was part of the negotiated agreement
described above.\21\ Under California's regulatory provision,
California deemed manufacturers to be in compliance with certain of
California's requirements if they complied with EPA's standards.\22\
However, EPCA explicitly provides that all State requirements ``related
to'' fuel economy standards, even those that may be identical or
equivalent to Federal requirements are preempted by EPCA.\23\ Moreover,
as discussed in additional detail below, California recently changed
its regulations so that it has no such ``deemed to comply'' provision
should the forthcoming SAFE final rule adopt any regulatory alternative
other than the no action alternative.\24\ This change sets up a direct
conflict between Federal and State requirements, exacerbating the
conflict that exists even now.
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    \20\ See id.; 77 FR 62624, 62637 (Oct. 15, 2012).
    \21\ See 75 FR 25324, 25328 (May 7, 2010).
    \22\ 83 FR 42986, 43233 (Aug. 24, 2018).
    \23\ See id. at 43233-34.
    \24\ See 83 FR 42986, 42990 tbl. I-4 (Aug. 24, 2018); Cal. Code
Regs. tit. 13, sec. 1961.3(c). California changed its regulation
following issuance of NHTSA and EPA's proposed rule. See State of
Cal., Office of Admin. Law, Notice of Approval of Regulatory Action
(Dec. 12, 2018), https://www.arb.ca.gov/regact/2018/leviii2018/form400dtc.pdf. NHTSA recognized the potential for such a change in
the proposal. 83 FR 42986, 43233 n.495 (Aug. 24, 2018).
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    Congress's intent to provide for uniform national fuel economy
standards is frustrated when State and local actors regulate in this
area. In the proposal, NHTSA explained that the need for regulatory
certainty, along with the clear prospect of disharmony, required it to
address preemption.\25\ NHTSA also explained its desire to seek
comments on this important issue from State and local officials, along
with other interested members of the public.\26\ NHTSA in fact received
many comments from State and local governments, NGOs, industry, and
others concerning preemption.\27\ This comment process helped ensure
that the agency considered all facets of this significant issue before
reaching a final determination in this rule.
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    \25\ 83 FR 42986, 43233 (Aug. 24, 2018).
    \26\ Id.
    \27\ See, e.g., California Air Resources Board (CARB), Docket
No. NHTSA-2018-0067-11873; Alliance of Automobile Manufacturers,
Docket No. NHTSA-2018-0067-12073; Joint Submission from the States
of California et al. and the Cities of Oakland et al., Docket No.
NHTSA-2018-0067-11735.
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    NHTSA also discussed the broad and clear text of EPCA's express
preemption provision.\28\ As NHTSA explained in the proposal, unlike
the Clean Air Act, there is no set of circumstances under EPCA in which
it would be appropriate or permissible for NHTSA to waive preemption or
allow States or local governments to adopt or enforce identical or
equivalent requirements.\29\ EPCA does not provide NHTSA with any
waiver authority whatsoever. To ensure Federal primacy over this area,
EPCA broadly preempts all State and local laws ``related to'' fuel
economy standards or average fuel economy standards.\30\ NHTSA
reiterates, consistent with the proposal, that in this rulemaking NHTSA
is concluding that State and local requirements that relate to fuel
economy standards by directly or substantially affecting corporate
average fuel economy levels are preempted.\31\
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    \28\ 83 FR 42986, 43233-34 (Aug. 24, 2018).
    \29\ Id. at 43233.
    \30\ 49 U.S.C. 32919(a).
    \31\ 83 FR 42986, 43233 (Aug. 24, 2018).
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    NHTSA also described Supreme Court precedent interpreting the
meaning of ``related to.'' \32\ In addition to the plain language of
the statute, NHTSA applied to EPCA the guidance from Supreme Court case
law to consider both the objectives of the statute and the effect of
the State laws on the Federal standards.\33\ As NHTSA explained, the
primacy of a single national fuel economy standard, set by the Federal
government, was an important objective of Congress in enacting EPCA.
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    \32\ Id.
    \33\ Id. at 43233-34.
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    In adopting EISA, Congress did not repeal or amend EPCA's express
preemption provision.\34\ While Congress included in EISA a savings
provision preventing EISA from limiting preexisting authority or
responsibility conferred by any law, or from authorizing violation of
any law,\35\ the savings clause did not purport to expand either EPA's
or NHTSA's preexisting authority or responsibility.\36\ NHTSA
recognized that during debate on the floor, some Members of Congress
made statements about the savings provision's impact on California's
ability to set tailpipe greenhouse gas emissions standards.\37\ NHTSA
affirms its view, consistent with Supreme Court precedent, that such
legislative history does not alter the plain text of the statute.\38\
In the end, Congress did not change EPCA's preemption provision when it
adopted EISA, despite clearly having the opportunity to do so.\39\
Because States lacked preexisting authority to set tailpipe greenhouse
gas emissions standards, as a result of EPCA's preemption provision,
EISA's savings clause did not give them that authority.
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    \34\ See EISA, Public Law 110-140 (2007).
    \35\ 42 U.S.C. 17002.
    \36\ See id.
    \37\ 83 FR 42986, 43234 (Aug. 24, 2018).
    \38\ See Food Mktg. Inst. v. Argus Leader Media, 139 S. Ct.
2356, 2364 (2019) (``In statutory interpretation disputes, a court's
proper starting point lies in a careful examination of the ordinary
meaning and structure of the law itself. Where, as here, that
examination yields a clear answer, judges must stop. Even those of
us who sometimes consult legislative history will never allow it to
be used to `muddy' the meaning of `clear statutory language.' '')
(internal citations omitted).
    \39\ See EISA, Public Law 110-140 (2007); 83 FR 42986, 43234
(Aug. 24, 2018).
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    In the proposal, NHTSA also described in detail the reasons that
tailpipe carbon dioxide emissions regulations or prohibitions are
``related to'' fuel economy standards.\40\ NHTSA explained that carbon
dioxide emissions are a necessary and inevitable byproduct of burning
gasoline: The more fuel a vehicle burns or consumes, the more carbon
dioxide it emits.\41\ Based on the physical and mathematically
measurable relationship between carbon dioxide emissions and fuel
economy, EPCA has always specified that compliance with fuel economy
standards is determined through tests and calculation procedures
established by EPA.\42\ Specifically, compliance with fuel economy
standards is based almost entirely on carbon dioxide emission
rates.\43\ As NHTSA noted, it is significant that in enacting EPCA,
Congress both adopted test procedures reliant on the direct
relationship between carbon dioxide emissions and fuel economy, and
preempted State and local governments from adopting requirements
related to fuel economy standards in the same law.\44\
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    \40\ 83 FR 42986, 43234 (Aug. 24, 2018).
    \41\ Id.
    \42\ 49 U.S.C. 32904(c).
    \43\ See 83 FR 42986, 43234 (Aug. 24, 2018).
    \44\ Id.
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    NHTSA affirms in this final rule that a State or local requirement
limiting tailpipe carbon dioxide emissions from automobiles has the
direct and substantial effect of regulating fuel consumption and, thus,
is ``related to'' fuel economy standards. Likewise, since carbon
dioxide emissions constitute the overwhelming majority of tailpipe
carbon emissions, a State regulation of all tailpipe greenhouse gas
emissions from automobiles or prohibiting all tailpipe emissions is
also ``related to'' fuel economy standards and preempted by EPCA.
    NHTSA is also finalizing its conclusion that EPCA does not preempt
all potential State or local regulation of greenhouse gas emissions
from vehicles. As NHTSA explained in the proposal,

some greenhouse gas emissions from vehicles are not related to fuel
economy because they have either no effect on fuel economy, or only an
insignificant effect on fuel economy.\45\ NHTSA provided an example of
a requirement with no bearing on fuel economy: a State regulation of
vehicular refrigerant leakage.\46\ NHTSA also explained that State
safety requirements that have only an incidental impact on fuel
economy, such as a requirement to use child seats, is not preempted
because it does not sufficiently relate to fuel economy standards.\47\
NHTSA also confirms its view that, if preempted requirements are
combined with requirements not related to fuel economy, ECPA would void
only the preempted portion of the law.
---------------------------------------------------------------------------

    \45\ Id. at 43234-35.
    \46\ Id. at 43235.
    \47\ Id.
---------------------------------------------------------------------------

    In addition, NHTSA and EPA are confirming their determination, in
this joint final action, that a Clean Air Act waiver does not waive
EPCA preemption. As explained in the proposal, a State or local law or
regulation related to automobile fuel economy standards is void ab
initio under the preemptive force of EPCA.\48\ As support, the proposal
cited longstanding Supreme Court case law concerning the Supremacy
Clause and action in violation of a statutory prohibition.\49\ In sum,
``[i]t is basic to this constitutional command [in the Supremacy
Clause] that all conflicting state provisions be without effect.'' \50\
---------------------------------------------------------------------------

    \48\ Id.
    \49\ Id.
    \50\ Maryland v. Louisiana, 451 U.S. 725, 746 (1981) (citing
McCulloch v. Maryland, 4 Wheat. 316,
    427 (1819)).
---------------------------------------------------------------------------

    As explained in the proposal, avoiding preemption under one Federal
law has no necessary bearing on another Federal law's preemptive
effect.\51\ For purposes of the present rule, this conclusion is
confirmed by Section 209 of the Clean Air Act, which explicitly states
that a waiver of preemption pursuant to that provision of the Clean Air
Act only relieves ``application of this section.'' \52\ NHTSA also
confirms its view that a Clean Air Act waiver does not ``federalize''
State or local requirements preempted by EPCA.
---------------------------------------------------------------------------

    \51\ 83 FR 42986, 43235 (Aug. 24, 2018).
    \52\ 42 U.S.C. 7543(b)(1).
---------------------------------------------------------------------------

    NHTSA and EPA also explained in the proposal their disagreement
with decisions from district courts in California and Vermont that held
that EPCA did not preempt State tailpipe greenhouse gas emissions
standards.\53\ The agencies particularly disagree with those district
courts' characterization of the ``related to'' language in EPCA's
preemption provision as narrow, their reliance on California's
application for a Clean Air Act waiver, and the courts' implied
preemption analyses.\54\ As the proposal explained, these decisions are
legally flawed, and NHTSA is not barred from proceeding with its
preemption determination here.\55\
---------------------------------------------------------------------------

    \53\ 83 FR 42986, 43232-38 (Aug. 24, 2018); see Green Mountain
Chrysler v. Crombie, 508 F. Supp. 2d 295 (D. Vt. 2007); Cent. Valley
Chrysler-Jeep, Inc. v. Goldstene, 529 F. Supp. 2d 1151 (E.D. Cal.
2007), as corrected (Mar. 26, 2008).
    \54\ 83 FR 42986, 43232-38 (Aug. 24, 2018).
    \55\ See id. at 43235.
---------------------------------------------------------------------------

    NHTSA also reaffirms its views on implied preemption, as described
in the proposal.\56\ State or local limitations or prohibitions on
tailpipe carbon dioxide emissions from automobiles directly conflict
with the objectives of EPCA. NHTSA balances statutory factors in
setting CAFE standards at ``the maximum feasible average fuel economy
level that the Secretary decides the manufacturers can achieve in that
model year'' (49 U.S.C. 32902(a)).\57\ State requirements, made based
on State-specific determinations unbound by the considerations in EPCA,
frustrate NHTSA's statutory role. If one or more States may issue
competing or overlapping requirements affecting fuel economy standards,
industry must also apply resources and effort at meeting standards
applicable only to discrete parts of the country in addition to those
spent to comply with the Federal standards. In accordance with EPCA,
manufacturers' ``average fuel economy'' is calculated based on specific
statutory requirements. 49 U.S.C. 32901(a)(5), 32904. Manufacturers
earn credits for exceeding average fuel economy standards. 49 U.S.C.
32903. This statutory compliance structure is impeded when States or
local governments attempt to set or enforce their own requirements,
which necessarily apply to manufacturers at a State or local level.
This interferes with the national ``average fuel economy'' program. The
broad preemption provision adopted by Congress in EPCA clearly
demonstrates the intention for a single national set of standards that
consider, among other things, economic feasibility and consumer choice.
Indeed, the entire purpose of a balanced standard is defeated if a
State can place its thumb on the scale. Likewise, separate State or
local requirements interfere with the compliance regime under EPCA of
performance determined based on nationwide fleet averages, which
determine manufacturers' credits or shortfalls. See 49 U.S.C. 32903.
---------------------------------------------------------------------------

    \56\ See id. at 43237-38.
    \57\ 49 U.S.C. 32902(f).
---------------------------------------------------------------------------

    NHTSA also finalizes the view, as discussed in the proposal, that
ZEV mandates are preempted by EPCA.\58\ Such laws, which require that a
certain number or percentage of vehicles sold or delivered in a State
by a manufacturer meet ZEV requirements, directly and substantially
affect fuel economy standards by requiring manufacturers to eliminate
fossil fuel use in a portion of their fleet. Like State or local
tailpipe GHG emissions standards, ZEV mandates require the application
of additional efforts and resources beyond those needed to comply with
Federal standards. ZEV mandates also directly conflict with the goals
of EPCA as they apply irrespective of the Federal statutory factors the
Secretary of Transportation (through NHTSA) is required to consider in
setting fuel economy standards, including technological feasibility and
economic practicability. In the proposal, NHTSA described, as an
example, California's ZEV mandate, which manufacturers must comply with
individually for each State adopting California's mandate.\59\ This
regime of State mandates forces manufacturers to expend scarce
resources on specific technology regardless of consumer demand, and
regardless of what the Secretary has determined in her judgment to be
the appropriate expenditure of resources necessary to comply with fuel
economy standards set in accordance with the balancing required by
EPCA.
---------------------------------------------------------------------------

    \58\ See id. at 43238-39.
    \59\ Id.
---------------------------------------------------------------------------

    NHTSA also confirms its view that the preemption portion of this
joint final action is a statement of what Federal law requires and is
effective without regard to any particular model year of vehicles and
without regard to the details of the fuel economy and greenhouse gas
emissions standards the agencies have set previously or set in the
future.\60\ In other words, NHTSA's regulation concerning EPCA
preemption is independent of and severable from the specific standards
it ultimately adopts for model year 2021 through 2026 automobiles.
Given the need for clarity on this issue, NHTSA has decided to issue
this as a separate final rule and will later finalize the standards for
model year 2021 through 2026 automobiles. NHTSA's preemption regulation
formalizes its longstanding position on preemption and incorporates
that position into the Code of Federal Regulations provisions
concerning passenger automobile

average fuel economy standards at 49 CFR 531.7 and 49 CFR part 531,
appendix B, and light truck fuel economy standards at 49 CFR 533.7 and
49 CFR part 533, appendix B. These portions of the regulations are
operable without regard to any specific Federal standards and
requirements in 49 CFR parts 531 and 533 or other parts of the Code of
Federal Regulations. Likewise, NHTSA's determination that a State or
local law or regulation of tailpipe greenhouse gas emissions from
automobiles is related to fuel economy standards is severable from
NHTSA's determination that State or local ZEV mandates are related to
fuel economy standards.
---------------------------------------------------------------------------

    \60\ See id. at 43239.
---------------------------------------------------------------------------

B. Scientific Relationship Between Tailpipe Carbon Dioxide Emissions
and Fuel Economy Standards

    NHTSA is finalizing its conclusion that State requirements
regulating tailpipe carbon dioxide emissions from automobiles are
related to fuel economy standards. The relationship between fuel
economy standards and regulations that limit or prohibit tailpipe
carbon dioxide emissions from automobiles is a matter of science and
mathematics. Commenters did not and cannot dispute the direct
scientific link between tailpipe carbon dioxide emissions from
automobiles and fuel economy. Thus, State and local laws and
regulations that regulate such tailpipe emissions are preempted under
EPCA.
    The relationship between carbon dioxide and fuel economy is
described in several statements in an appendix to parts 531 and 533
that NHTSA is finalizing in this document.
    First, ``[a]utomobile fuel economy is directly and substantially
related to automobile tailpipe emissions of carbon dioxide.'' 49 CFR
part 531, appx. B, section (a)(1)(A); 49 CFR part 533, appx. B, section
(a)(1)(A).\61\ No commenters disputed or otherwise specifically
commented on this statement.
---------------------------------------------------------------------------

    \61\ 83 FR 42986, 43489 (Aug. 24, 2018).
---------------------------------------------------------------------------

    Second, ``[c]arbon dioxide is the natural byproduct of automobile
fuel consumption.'' 49 CFR part 531, appx. B, section (a)(1)(B); 49 CFR
part 533, appx. B, section (a)(1)(B).\62\ One comment identified this
as a correct statement,\63\ and another highlighted this fact in noting
NHTSA's longstanding and consistent view on preemption.\64\ No
commenters disagreed with this factual statement.
---------------------------------------------------------------------------

    \62\ Id.
    \63\ Walter Kreucher, Docket No. NHTSA-2018-0067-0444.
    \64\ Association of Global Automakers, Docket No. NHTSA-2018-
0067-12032.
---------------------------------------------------------------------------

    Third, ``[t]he most significant and controlling factor in making
the measurements necessary to determine the compliance of automobiles
with the fuel economy standards in this part [531 and 533] is their
rate of tailpipe carbon dioxide emissions.'' 49 CFR part 531, appx. B,
section (a)(1)(C); 49 CFR part 533, appx. B, section (a)(1)(C).\65\ The
Alliance of Automobile Manufacturers similarly stated that the
measurements for CAFE compliance involved ``the same tests, vehicles,
sales data, and emissions measurements that the EPA uses to measure
carbon dioxide and tailpipe GHG emissions.'' \66\ Fiat Chrysler
Automobiles (FCA) also reiterated this point from the Alliance's
comments,\67\ and the Competitive Enterprise Institute highlighted
NHTSA's discussion of compliance measurement in agreeing that fuel
economy standards and greenhouse gas emissions standards are inherently
related.\68\ CARB did not dispute this factual statement, but pointed
out that carbon dioxide emissions are only one part of the compliance
testing regime Congress approved--a fact that NHTSA had already
recognized in its proposal.\69\ As NHTSA explained in the proposal, as
specified by EPCA, compliance with the CAFE standards is and has always
been based on the rates of emission of carbon dioxide, carbon monoxide,
and hydrocarbons from covered vehicles, but primarily on the emission
rates of carbon dioxide.\70\ The role of carbon dioxide is
approximately 100 times greater than the combined role of the other two
relevant carbon exhaust gases.\71\
---------------------------------------------------------------------------

    \65\ 83 FR 42986, 43489 (Aug. 24, 2018).
    \66\ Alliance of Automobile Manufacturers, Docket No. NHTSA-
2018-0067-12073.
    \67\ Fiat Chrysler Automobiles (FCA), Docket No. NHTSA-2018-
0067-11943.
    \68\ Competitive Enterprise Institute, Docket No. NHTSA-2018-
0067-12015.
    \69\ See California Air Resources Board (CARB), Docket No.
NHTSA-2018-0067-11873; 83 FR 42986, 43234 (Aug. 24, 2018).
    \70\ See 83 FR 42986, 43234 (Aug. 24, 2018).
    \71\ 71 FR 17566, 17655-56 (Apr. 6, 2006); 83 FR 42986, 43234
(Aug. 24, 2018).
---------------------------------------------------------------------------

    Fourth, ``[a]lmost all technologically feasible reduction of
tailpipe emissions of carbon dioxide is achievable through improving
fuel economy, thereby reducing both the consumption of fuel and the
creation and emission of carbon dioxide.'' 49 CFR part 531, appx. B,
section (a)(1)(D); 49 CFR part 533, appx. B, section (a)(1)(D).\72\ The
South Coast Air Quality Management District (South Coast) commented
that NHTSA previously proposed, in 2008, adopting similar regulatory
text that used the word ``most'' instead of ``almost all.'' \73\ South
Coast asserts that the 2008 proposal shows that NHTSA ``strains to
exaggerate'' the overlap between greenhouse gas emissions standards and
fuel economy standards.\74\ NHTSA disagrees. While South Coast points
to hybrid electric vehicles and ZEVs, it offers no evidence to refute
the fact that almost all technologically feasible reduction of tailpipe
emissions of carbon dioxide is achievable through improving the fuel
economy levels of the vehicles in question.
---------------------------------------------------------------------------

    \72\ 83 FR 42986, 43489 (Aug. 24, 2018).
    \73\ South Coast Air Quality Management District, Docket No.
NHTSA-2018-0067-11813.
    \74\ Id.
---------------------------------------------------------------------------

    Fifth, ``as a practical matter, regulating fuel economy controls
the amount of tailpipe emissions of carbon dioxide, and regulating the
tailpipe emissions of carbon dioxide controls fuel economy.'' 49 CFR
part 531, appx. B, section (a)(1)(E); 49 CFR part 533, appx. B, section
(a)(1)(E).\75\ No commenter disputed this statement. The National
Automobile Dealers Association agreed, putting it this way: ``the
physics and chemistry involved with fuel economy and GHG emissions
standards are such that controlling fuel economy controls GHGs and
controlling GHGs controls fuel economy.'' \76\ It is also worth noting
that technology cannot reduce the amount of carbon dioxide produced by
combusting one gallon of gas. Instead, only technology that reduces the
amount of gas needed to drive one mile (fuel economy) will reduce the
amount of carbon dioxide generated per mile.
---------------------------------------------------------------------------

    \75\ 83 FR 42986, 43489 (Aug. 24, 2018).
    \76\ National Automobile Dealers Association, Docket No. NHTSA-
2018-0067-12064.
---------------------------------------------------------------------------

    These statements in the regulatory appendix concerning the
scientific relationship between automobile carbon dioxide emissions and
fuel economy provide the foundation for NHTSA's preemption analysis.
Due to this scientific relationship, which no commenter refuted, a
regulation of tailpipe carbon dioxide emissions from automobiles that
does not explicitly state that it is regulating fuel economy
nevertheless has the effect of doing so. The label a State chooses to
put on its regulations certainly is not dispositive in a preemption
analysis. See, e.g., Nat'l Meat Ass'n. v. Harris, 565 U.S. 452, 464
(2012). One comment, from the Northeast States for Coordinated Air Use
Management (NESCAUM), asserted that ``California's GHG standards do not
mention fuel economy or attempt to

regulate fuel economy.'' \77\ To such comments, the agencies must ask
ourselves the age-old question: ``What's in a name?'' and conclude
``[t]hat which we call a rose by any other name would smell as sweet.''
\78\ Arguments focused on form, or worse--labels--over substance are
not persuasive. Moreover, it is indisputable that EPCA preemption
reaches beyond explicit regulations of fuel economy and into
regulations ``related to'' fuel economy. The words ``related to''
cannot be read out of the statute or narrowed in a way that undermines
Congress's broad preemption intent.
---------------------------------------------------------------------------

    \77\ Northeast States for Coordinated Air Use Management
(NESCAUM), Docket No. NHTSA-2018-0067-11691.
    \78\ W. Shakespeare, Romeo & Juliet, II, ii (47-48) (1597).
---------------------------------------------------------------------------

    It is a matter of undisputed fact that the more fuel a vehicle
burns or consumes, the more carbon dioxide it emits. There is a
necessary relation between the regulation of one side of this equation
and the regulation of the other. In other words, improving fuel economy
has two inherently related benefits: Reducing fuel consumption and
reducing carbon dioxide emissions. State and local governments cannot
evade the preemptive sweep of EPCA by emphasizing only one side of
these benefits and downplaying or ignoring the other when describing
their regulations.
    To further illustrate the situation, consider types of regulations
for a swimming pool. If the pool has a hose on one side that is filling
the pool and a hose on the other side that is draining the pool, you
can regulate the water level in the pool by controlling either hose.
Limiting the amount of water released by the inflow hose, is not itself
a regulation of the outflow hose. But it is nonsensical to say that
regulating the pool's inflow is not related to regulating its outflow.
A regulation of either hose necessarily affects the level of water in
the same pool. The Supreme Court has recognized preemption should
appropriately apply in such contexts. See Rowe v. N.H. Motor Transp.
Ass'n, 552 U.S. 364, 368, 72 (2008) (looking at effect of regulation to
determine it was preempted even though ``it tells shippers what to
choose rather than carriers what to do'' where Federal law preempted
State laws ``related to a price, route, or service of any motor carrier
. . . with respect to the transportation of property''); Engine Mfrs.
Ass'n. v. South Coast Air Quality Mgmt. Dist., 541 U.S. 246, 255 (2004)
(explaining that it ``would make no sense'' to allow a State regulation
to evade preemption simply because it addressed the purchase, rather
than manufacture, of a federally regulated product).

C. Importance of One National Standard

    To ensure uniform national fuel economy standards, Congress
determined that it was appropriate to preempt States and local
governments from adopting or enforcing laws or regulations related to
the Federal standards. Effectuating Congress's goal requires NHTSA to
address preemption. Preemption is necessary to the effectiveness of
NHTSA's existing and forthcoming fuel economy standards and regulatory
certainty into the future, specifically, one set of national standards.
Congress made clear, through the required comprehensive balancing of
factors and underlined by its inclusion of an express preemption
provision, that State and local requirements impede the national fuel
economy program. Thus, NHTSA is exercising its authority in this
document, under 49 U.S.C. 32901 through 32903, to promulgate
regulations to protect the integrity of the national program. This
confirms the clear preemptive nature of NHTSA's standards, as stated in
49 U.S.C. 329219 and provides additional clarity on the scope of
preemption, to carry out NHTSA's statutory authority to set nationally
applicable standards.
    A consistent refrain throughout many of the comments NHTSA received
on its preemption proposal was the need for one national standard.\79\
Preemption provides for just that uniformity. Indeed, that was the very
purpose for Congress's including the express preemption provision in
EPCA.
---------------------------------------------------------------------------

    \79\ See, e.g., Alliance of Automobile Manufacturers, Docket No.
NHTSA-2018-0067-12073; Association of Global Automakers, Docket No.
NHTSA-2018-0067-12032.
---------------------------------------------------------------------------

    In enacting EPCA's preemption provision, Congress explicitly
recognized the need to avoid a patchwork of requirements related to
fuel economy standards, and gave NHTSA the exclusive authority to set
and enforce fuel economy standards with discrete and limited exceptions
as set forth in 49 U.S.C. 32919. NHTSA's exclusive authority is
exercised through joint rulemaking with EPA for the very reason that
tailpipe carbon dioxide emissions standards are directly and
substantially related to fuel economy standards and apply concurrently
to the same fleet of vehicles. This joint action enables the Federal
government to administer its overlapping obligations while avoiding
inconsistency. See Massachusetts v. EPA, 549 U.S. 497, 532 (2007).
    Recent developments in California provide good examples of the need
for a national standard and the problem that Congress sought to address
in enacting EPCA's preemption provision. After the agencies published
the proposal, California amended its regulations such that
manufacturers are bound to comply with requirements consistent with the
no action alternative for model years 2021 through 2026,\80\ regardless
of what the Federal standards are ultimately adopted. Moreover, even as
to the existing Federal standard, California's regulations are
impermissible under EPCA because only a Federal standard can apply
nationally. State or local standards necessarily apply at the State and
local level, and therefore are inherently inconsistent with the
nationwide average standards pursuant to EPCA. See 49 U.S.C.
32901(a)(5)-(6), (13). Likewise, State and local compliance regimes
interfere with the national program of credits and shortfalls for
nationwide fleet performance by making compliance across the country
inordinately complicated, inefficient, and expensive. See id. 32903.
---------------------------------------------------------------------------

    \80\ 83 FR 42986, 42990 tbl. I-4 (Aug. 24, 2018).
---------------------------------------------------------------------------

    Despite a widespread shared belief in the importance of one
national standard, NHTSA's proposal on preemption received a mix of
support and opposition in comments. Some commenters weighed in on
preemption largely only to emphasize the importance of having a
national standard.\81\ Other commenters that supported the substance of
the proposal agreed with NHTSA's analysis of both express and implied
preemption, as well as the conclusion that both State laws that limit
and State laws that prohibit carbon dioxide tailpipe emissions from
automobiles, or have the direct or substantial effect of doing so, are
preempted.\82\ On the other hand, those commenters that opposed the
substance of the proposal asked NHTSA to withdraw and not finalize any
regulatory text concerning preemption.\83\ Doing so would ignore the
very purpose of EPCA's fuel economy provisions and NHTSA's statutory
obligation under EPCA: To balance statutory factors in order to

establish standards that are ``the maximum feasible average fuel
economy level that the Secretary decides the manufacturers can achieve
in that model year.'' \84\ NHTSA disagrees with the comments that ask
it to withdraw its proposal and not finalize any regulatory text on
preemption. Given the present circumstances, failing to address this
issue amounts to ignoring the existence of EPCA's preemption provision,
and allowing for State and local requirements that interfere with
NHTSA's statutory duty to set nationally consistent fuel economy
standards.
---------------------------------------------------------------------------

    \81\ See, e.g., Toyota Motor North America, Docket No. NHTSA-
2018-0067-12150.
    \82\ See, e.g., Alliance of Automobile Manufacturers, Docket No.
NHTSA-2018-0067-12073; Competitive Enterprise Institute, Docket No.
NHTSA-2018-0067-12015.
    \83\ See, e.g., Joint Submission from the States of California
et al. and the Cities of Oakland et al., Docket No. NHTSA-2018-0067-
11735.
    \84\ 49 U.S.C. 32902(a), (f).
---------------------------------------------------------------------------

    The rule NHTSA is adopting in this document, under its authority to
implement a national automobile fuel economy program in 49 U.S.C. 32901
through 32903, will ultimately provide needed certainty concerning
preemption into the future. While EPCA's preemption provision has been
in place for decades, the present circumstances demonstrate the need
for greater clarity on this issue.
    NHTSA's statutory role is to set nationwide standards based on a
reasoned balancing of statutory factors. State and local requirements--
unbound by these considerations--undermine NHTSA's ability to set
standards applicable across the entire country. NHTSA is obliged to set
standards at ``the maximum feasible average fuel economy level that the
Secretary decides the manufacturers can achieve in that model year.''
49 U.S.C. 32902(a). The regulation NHTSA is finalizing in this document
implements that authority in 49 U.S.C. 32902 by clarifying the State
requirements that impermissibly interfere with its statutory role to
set nationally applicable standards. As explained in the proposal, as a
practical matter, State and local actors would generally only set
requirements that have the effect of requiring a higher level of
average fuel economy (lest their standards lack impact).\85\ That
supposition has now been demonstrated by California's preemptive action
to effectively set higher standards than the Federal standards, should
the forthcoming final SAFE rule finalize anything lower than the no
action alternative described in the NPRM for model years 2021 through
2026. This state of regulatory inconsistency--and even the potential
for such inconsistency--is anathema to the express terms and purposes
of EPCA, which does not even permit States to set fuel economy
standards identical to those set by NHTSA in accordance with the
statutory requirements.\86\ Even identical standards interfere with the
national program by imposing requirements not applicable to nationwide
fleets and impose compliance regimes inconsistent with EPCA. See, e.g.,
49 U.S.C. 32903 (establishing specific requirements for earning and
using credits based on nationwide average fuel economy performance).
---------------------------------------------------------------------------

    \85\ 83 FR 42986, 43238 (Aug. 24, 2018).
    \86\ See 49 U.S.C. 32902(a), 32919(a).
---------------------------------------------------------------------------

    California's recent action also demonstrates disregard for NHTSA's
mandate to set standards in no more than 5 model year increments.\87\
To avoid inconsistent State standards, California's regulatory change
would require NHTSA to adopt the most stringent of nine regulatory
alternatives it considered in the proposal.\88\ NHTSA did not bind
itself in any way to that regulatory alternative in its 2012 final
rule, and to do so would have been contrary to law.\89\
---------------------------------------------------------------------------

    \87\ See id. 32902(a), (b)(3)(B).
    \88\ See Cal. Code Regs. tit. 13, section 1961.3(c); see 83 FR
42986, 42990 tbl. I-4 (Aug. 24, 2018) (listing augural standards as
baseline/no action alternative, and eight other alternatives under
consideration).
    \89\ See 49 U.S.C. 32902(b)(3)(B); 77 FR 62624, 62627 (Oct. 15,
2012).
---------------------------------------------------------------------------

    Automakers must comply with the Federal fuel economy and GHG
emissions requirements, and do so at significant cost. States like
California that do not abide by the constraints of Federal law, and
instead set inconsistent or even duplicative requirements related to
fuel economy standards unjustifiably increase manufacturers' compliance
costs, which must be either passed along to consumers or absorbed by
the industry. Clarity on preemption is therefore essential to ensure
the industry has the ability to efficiently expend its resources to
comply with the nationally applicable standards determined by the
Federal government in light of the Federal statutory factors that must
be balanced, without the need to separately account for or comply with
State or local requirements.
    While it is of course ideal for States to independently abide by
the constraints of Federal law, this does not reflect the current state
of affairs. NHTSA's awareness of laws and regulations already in place,
as well as the public comments it received in response to its proposal,
confirm the need for additional clarity on the boundaries of EPCA
preemption. Wrongly decided decisions by district courts in California
and Vermont (appeals of which were abandoned as a condition of the
negotiated agreement prior to the 2012 rulemaking), as well as NHTSA's
own silence on this issue in recent years, are sowing confusion,
emphasizing the need for the clarity provided by this final rule
affirmatively establishing One National Program.\90\
---------------------------------------------------------------------------

    \90\ As described in the proposal, NHTSA's views on preemption
are longstanding. However, NHTSA has not directly addressed
preemption in its most recent CAFE rulemakings. South Coast disputes
that NHTSA's views on preemption are longstanding, pointing to legal
and factual developments since. South Coast Air Quality Management
District, Docket No. NHTSA-2018-0067-11813. That NHTSA has not
opined on developments does not mean that its views have changed.
South Coast also points to some wording changes to argue that NHTSA
has shifted positions. NHTSA disagrees. It has consistently held the
position that State regulation of tailpipe greenhouse gas emissions
from automobiles is preempted, and South Coast has not identified
any statements to the contrary. In any event, the fact that NHTSA
has not addressed EPCA preemption in its most recent rulemakings
highlights the need to address the issue without further delay.
---------------------------------------------------------------------------

D. NHTSA's Final Rule Provides Clarity and Certainty on EPCA Preemption

    This final rule provides needed clarity on the scope of EPCA
preemption. NHTSA is adopting regulatory text, including a detailed
appendix, in addition to discussing this issue in the preamble to the
rule, specifically to provide clarity on EPCA's preemption provision.
    NHTSA rejects the assertion advanced in one comment that NHTSA did
not provide notice and a fair opportunity to comment on its
interpretation of EPCA preemption.\91\ Any such suggestion is negated
by the host of commenters that addressed the issue of preemption in
response to the proposal. NHTSA proposed codifying its preemption
interpretation in parts 531 and 533, and all commenters were explicitly
asked to comment on the specific proposed regulatory text as well as on
the explanation of NHTSA's interpretation set out in the preamble to
the NPRM.
---------------------------------------------------------------------------

    \91\ Joint Submission from the States of California et al. and
the Cities of Oakland et al., Docket No. NHTSA-2018-0067-11735.
---------------------------------------------------------------------------

    NHTSA also disagrees with a comment from the California Air
Resources Board (CARB) that asserted the proposal was not clear on the
scope of preemption.\92\ The regulatory text articulates the boundaries
of both express and implied preemption, with appropriate limitation to
State or local laws or regulations that: (1) Regulate or prohibit
tailpipe carbon dioxide emissions from automobiles, or (2) have the
direct or substantial effect of regulating or prohibiting tailpipe
carbon

dioxide emissions from automobiles or automobile fuel economy. In the
proposal, NHTSA provided examples of laws that would not be
preempted.\93\ CARB did not identify any examples of laws where
additional clarity was needed.
---------------------------------------------------------------------------

    \92\ California Air Resources Board (CARB), Docket No. NHTSA-
2018-0067-11873; Joint Submission from the States of California et
al. and the Cities of Oakland et al., Docket No. NHTSA-2018-0067-
11735.
    \93\ 83 FR 42986, 43235 (Aug. 24, 2018).
---------------------------------------------------------------------------

    It should not be difficult for States or local governments to
ascertain whether their laws or regulations regulate or prohibit
tailpipe carbon dioxide emissions. As NHTSA explained in the proposal
and reiterates in this document, both requirements specific to tailpipe
carbon dioxide emissions from automobiles and those that address all
tailpipe greenhouse gas emissions from automobiles are preempted, given
that carbon dioxide emissions constitute the overwhelming majority of
those emissions.\94\ Likewise, ZEV mandates are also preempted.\95\
---------------------------------------------------------------------------

    \94\ Id. at 43234.
    \95\ See id. at 43238-39.
---------------------------------------------------------------------------

    NHTSA also does not believe it should be difficult for States or
local governments to determine if their laws or regulations have the
direct or substantial effect of regulating or prohibiting tailpipe
carbon dioxide emissions from automobiles or automobile fuel
economy.\96\ To aid in this effort, in the proposal, NHTSA described
requirements that would not be preempted because they have only
incidental impact on fuel economy or carbon dioxide emissions.\97\ The
examples NHTSA provided were child seat mandates and laws governing
vehicular refrigerant leakage.\98\
---------------------------------------------------------------------------

    \96\ South Coast argued that EPCA preemption would not reach
possible State and local requirements concerning lease arrangements
or requirements for used vehicles. South Coast Air Quality
Management District, Docket No. NHTSA-2018-0067-11813. NHTSA does
not agree. EPCA preempts requirements related to fuel economy
standards or average fuel economy standards for automobiles covered
by an average fuel economy standard under EPCA. If a State
requirement falls within this scope, it is preempted. For example, a
State could not prohibit dealers from leasing automobiles or selling
used automobiles unless they meet a fuel economy standard.
    \97\ 83 FR 42986, 43235 (Aug. 24, 2018).
    \98\ Id.
---------------------------------------------------------------------------

    Moreover, contrary to assertions in some comments, NHTSA's adoption
of regulatory text does provide a limiting principle \99\ and is not
overbroad.\100\ Congress set the extraordinarily broad boundaries of
preemption in EPCA, where it specified that State and local laws
``related to fuel economy standards'' are preempted. The words
``related to'' have meaning and cannot be read out of the statute. To
the extent that questions of interpretation remain about the scope of
preemption, that is a consequence of the statute, and is far from
unique--particularly with respect to the ``related to'' language, which
Congress has used in multiple contexts.\101\ The Supreme Court has
opined on the meaning of similar terms. However, NHTSA recognizes the
concerns about the appropriate limitations of preemption.
Notwithstanding the broad sweep of EPCA preemption, NHTSA intends to
assert preemption only over State or local requirements that directly
or substantially affect corporate average fuel economy standards.
---------------------------------------------------------------------------

    \99\ Joint Submission from the States of California et al. and
the Cities of Oakland et al., Docket No. NHTSA-2018-0067-11735.
    \100\ Id.; California Air Resources Board (CARB), Docket No.
NHTSA-2018-0067-11873; South Coast Air Quality Management District,
Docket No. NHTSA-2018-0067-11813.
    \101\ See Rowe v. N.H. Motor Transp. Ass'n, 552 U.S. 364, 370-73
(2008); Am. Airlines v. Wolens, 513 U.S. 219, 226-27 (1995); Shaw v.
Delta Airlines, Inc., 463 U.S. 85, 97 (1983).
---------------------------------------------------------------------------

    Through its adoption of specific regulatory text in this document,
NHTSA is providing guidance on the boundary set by Congress, as well as
under principles of implied preemption. Notably, NHTSA has not
concluded that implied preemption broadens the scope of preemption
established by Congress. As NHTSA recognized in its proposal, some
greenhouse gas emissions from automobiles have no relation to fuel
economy and therefore may be regulated by States or local governments
without running afoul of EPCA preemption. NHTSA provided examples of
State or local requirements that are not preempted. It also
specifically invited comment on the extent to which State or local
requirements can have some incidental impact on fuel economy or carbon
dioxide emissions without being related to fuel economy standards, and
thus are not preempted. NHTSA did not receive any directly responsive
comments regarding this issue, including from State and local
government commenters, suggesting that they do not currently have
questions about how preemption would apply to their laws or
regulations.\102\
---------------------------------------------------------------------------

    \102\ Some commenters did assert that California's greenhouse
gas emissions standards or ZEV mandates have only an incidental
impact on fuel economy, or that NHTSA was not clear why those
requirements have more than an incidental impact on fuel economy.
California Air Resources Board (CARB), Docket No. NHTSA-2018-0067-
11873; Northeast States for Coordinated Air Use Management
(NESCAUM), Docket No. NHTSA-2018-0067-11691; South Coast Air Quality
Management District, Docket No. NHTSA-2018-0067-11813. NHTSA
disagrees. It discussed these issues in detail in parts b, f, and g
of the preemption discussion of the proposed rule and incorporates
those discussions here. 83 FR 42986, 43234, 37-39 (Aug. 24, 2018).
---------------------------------------------------------------------------

    As an additional limiting principle, NHTSA reiterates the statement
in its proposal that only a portion of a law or regulation would be
preempted, where possible. This would be the case if the law or
regulation combined multiple severable elements that were allowable and
not allowable, such as with a regulation of both vehicular refrigerant
leakage and tailpipe carbon dioxide emissions--refrigerant leakage
requirements could remain in place while tailpipe carbon dioxide
emissions regulations would necessarily be preempted.
    NHTSA rejects the argument made by certain commenters that the
presumption against preemption applies in this context.\103\ The
presumption is not appropriate given EPCA's express statutory
preemption provision. See Puerto Rico v. Franklin Cal. Tax-Free Trust,
136 S. Ct. 1938, 1946 (2016) (explaining that ``because the statute
`contains an express pre-emption clause,' we do not invoke any
presumption against pre-emption but instead `focus on the plain wording
of the clause, which necessarily contains the best evidence of
Congress' pre-emptive intent.' '') (quoting Chamber of Commerce of
United States of Am. v. Whiting, 563 U.S. 582, 594 (2011)).
---------------------------------------------------------------------------

    \103\ See California Air Resources Board (CARB), Docket No.
NHTSA-2018-0067-11873; Center for Biological Diversity et al.,
Docket No. NHTSA-2018-0067-12000; South Coast Air Quality Management
District, Docket No. NHTSA-2018-0067-11813.
---------------------------------------------------------------------------

    NHTSA reaffirms the view that EPCA's express preemption provision
is broad and clear. NHTSA's review and assessment of comments has not
changed its view. Some comments noted that the statute specifically
preempts laws or regulations related to fuel economy standards.\104\
They assert that States and local governments are unconstrained by EPCA
preemption in regulating future model year vehicles, before they are
covered by a fuel economy standard issued by NHTSA. NHTSA disagrees.
---------------------------------------------------------------------------

    \104\ South Coast Air Quality Management District, Docket No.
NHTSA-2018-0067-11813; see also Joint Submission from the States of
California et al. and the Cities of Oakland et al., Docket No.
NHTSA-2018-0067-11735.
---------------------------------------------------------------------------

    EPCA preempts State and local laws and regulations that relate to:
(1) Fuel economy standards, or (2) average fuel economy standards for
automobiles covered by an average fuel economy standard under 49 U.S.C.
Chapter 329. Currently, automobiles through model year 2021 are covered
by an average fuel economy standard under Chapter 329.\105\ NHTSA will
continue setting standards for future model years, pursuant to the
mandate in 49 U.S.C. 32902(a) that ``[a]t least 18 months

before the beginning of each model year, the Secretary of
Transportation shall prescribe by regulation average fuel economy
standards for automobiles manufactured by a manufacturer in that model
year.'' \106\ NHTSA prescribes ``average fuel economy standards for at
least 1, but not more than 5, model years.'' 49 U.S.C. 32902(b)(3)(B).
State and local requirements that address automobiles beyond model year
2026 are therefore preempted if they relate to ``fuel economy
standards'' that NHTSA is required to establish in the future. To
conclude otherwise would be to make the impermissible assumption that
NHTSA will not carry out Congress's command.
---------------------------------------------------------------------------

    \105\ See 77 FR 62624, 62637 (Oct. 15, 2012).
    \106\ 49 U.S.C. 32902(a) (emphasis added).
---------------------------------------------------------------------------

    The regulation NHTSA is finalizing in this document implements that
authority in 49 U.S.C. 32902 by making clear that State and local
requirements that relate to fuel economy standards for future model
year vehicles conflict with NHTSA's ability to set nationally
applicable standards for those vehicles in the future and thus are
impliedly preempted. Manufacturers make design decisions well in
advance of production, as Congress recognized by adding ``lead time''
provisions to the statute. State and local requirements for automobiles
not yet covered by a NHTSA standard could force manufacturers into
plans that are not economically practical or otherwise inconsistent
with EPCA's statutory factors--since States and local governments are
not bound by those considerations. By the time future model year
vehicles are produced, they will be covered by a NHTSA standard. If
States or local governments were permitted to issue regulations related
to fuel economy for future model year vehicles, manufacturers would at
least act at risk of running afoul of those non-Federal regulations. At
least some manufacturers would undoubtedly feel compelled to conform
with such non-Federal regulations until the Federal government sets its
own standards. Even if non-Federal regulations are not ultimately
enforceable as to produced vehicles (since a Federal fuel economy
standard will be adopted, in time), they clearly conflict with the
congressionally imposed constraint of issuing standards for not more
than 5 model years. Such far-reaching regulations are based on
predictions about the future that are inevitably less reliable the
further in time they reach. Manufacturers are therefore put in an
untenable position of either planning towards State and local
regulations based on potentially outdated or unrealistic expectations
about the future, or ignoring them before knowing the Federal standards
that will eventually apply and acting at risk of enforcement by non-
Federal actors. Moreover, different States could impose different and
conflicting fuel economy requirements on manufacturers for future model
years, a result directly at odds with the single national standard
established by EPCA. Any of these scenarios demonstrates that the
position that EPCA preemption does not reach regulation of model year
vehicles not currently covered by a NHTSA standard is flawed. State or
local requirements related to fuel economy standards for any model year
automobiles are preempted.
    The regulatory text and preamble discussion clearly articulates
NHTSA's views on the meaning of ``related to'' in EPCA's express
preemption provision, which are confirmed following NHTSA's review and
assessment of comments. As discussed in the proposal, EPCA is not
unique in using the phrase ``related to'' to set the scope of
preemption.\107\ NHTSA described prior Supreme Court case law
interpreting this phrase as broad and including such conceptual
relationships as having an ``association with'' or ``connection to.''
In its comments, South Coast asserted that NHTSA's discussion was
``legally erroneous'' because it did not include ``discussion and
analysis'' of a line of Supreme Court cases that began with New York
State Conference of Blue Cross v. Travelers Ins. Co., 514 U.S. 645
(1995).\108\ South Coast's criticism is unfounded; NHTSA directly
recognized the Travelers line of cases which look to the objectives of
the statute as a guide to the scope of preemption. See Travelers, 514
U.S. at 656. In the proposal, NHTSA specifically applied this analysis
to the CAFE context and cited a 1997 case quoting Travelers.\109\ The
Travelers line of cases supports NHTSA's position on preemption. As
NHTSA explained in the proposal, EPCA's preemption provision
demonstrates that one of Congress's objectives was to create a single
set of national fuel economy standards. The language Congress enacted
preempts all State and local laws and regulations that relate to fuel
economy standards, and does not exempt even State requirements that are
identical to Federal requirements. Moreover, NHTSA's proposal was not
intended as a comprehensive recitation of all case law addressing the
use of ``related to'' in statutory preemption provisions. There are
many Supreme Court decisions that support the breadth of that language
beyond those specifically cited in the proposal.\110\ For example, in
Rowe, the Court recognized that a State statute that forbid certain
retailers from employing a delivery service unless it followed certain
delivery procedures was preempted by the Federal Aviation
Administration Authorization Act, which preempted States from enacting
or enforcing laws ``related to a price, route, or service of any motor
carrier.'' Rowe, 552 U.S. at 368, 71-73. The Court recognized that the
State law was directed at shippers rather than carriers, but found that
the effect of the requirements impacted carriers. Id. at 372. The Court
explained that State laws ``whose `effect' is `forbidden' under federal
law are those with a `significant impact' on carrier rates, routes or
services.'' Id. at 375 (emphasis in original). Likewise, here,
regulation of tailpipe carbon dioxide emissions has a direct and
undeniably substantial effect on fuel economy.
---------------------------------------------------------------------------

    \107\ 83 FR 42986, 43233 (Aug. 24, 2018).
    \108\ South Coast Air Quality Management District, Docket No.
NHTSA-2018-0067-11813.
    \109\ 83 FR 42986, 43233 (Aug. 24, 2018).
    \110\ See, e.g., Rowe v. N.H. Motor Transp. Ass'n, 552 U.S. 364,
367-72 (2008).
---------------------------------------------------------------------------

    However, NHTSA, of course, agrees that ``related to'' is not
unlimited.\111\ NHTSA specifically discussed the limitations of
preemption in its proposal, which only seeks to preempt State or local
requirements that directly or substantially affect corporate average
fuel economy. NHTSA also provided specific examples of State laws and
regulations that would not be preempted, as well as clearly
articulating some that are preempted. As discussed above, the
regulatory text NHTSA is adopting in this document is appropriately
limited and consistent with the scope of preemption established by
Congress.
---------------------------------------------------------------------------

    \111\ As the Supreme Court has stated, ``the breadth of the
words `related to' does not mean the sky is the limit.'' Dan's City
Used Cars, Inc. v. Pelkey, 569 U.S. 251, 260 (2013).
---------------------------------------------------------------------------

    With respect to implied preemption, NHTSA agrees with comments that
assert it is a fact-driven analysis.\112\ However, NHTSA disagrees that
there was an insufficient factual record for it to evaluate the
conflict either at the time of the proposal or now.\113\ NHTSA is well
aware of State regulations of tailpipe greenhouse gas emissions
(including carbon dioxide) and ZEV mandates, and described several of
these in the proposal. The foundational

factual analysis involves the scientific relationship between
automobile fuel economy and automobile tailpipe emissions of carbon
dioxide. NHTSA discussed this scientific relationship in detail. No
commenter contested the scientific and mathematical relationship
between them.
---------------------------------------------------------------------------

    \112\ California Air Resources Board (CARB), Docket No. NHTSA-
2018-0067-11873; Joint Submission from the States of California et
al. and the Cities of Oakland et al., Docket No. NHTSA-2018-0067-
11735.
    \113\ California Air Resources Board (CARB), Docket No. NHTSA-
2018-0067-11873.
---------------------------------------------------------------------------

    Contrary to CARB's contention in its comments, the fact that NHTSA
acknowledged that some State requirements that incidentally affect
greenhouse gas emissions are not preempted does not demonstrate that
there is an insufficient record for finding that other laws do pose a
conflict to NHTSA's statutory role to set nationwide fuel economy
standards for automobiles.\114\ To the contrary, NHTSA carefully
considered and acknowledged the limitations of EPCA preemption by
discussing a variety of types of laws, and providing specific examples.
---------------------------------------------------------------------------

    \114\ Id.
---------------------------------------------------------------------------

    NHTSA also disagrees with the claim made in some comments that it
does not have delegated authority to issue a regulation on this topic,
and is not owed deference or weight for its regulation implementing
EPCA's express preemption provision or the conflict resulting from
State or local laws or regulations.\115\ Congress gave the Secretary of
Transportation express authorization to prescribe regulations to carry
out her duties and powers. 49 U.S.C. 322(a).\116\ NHTSA has delegated
authority to carry out the Secretary's authority under Chapter 329 of
Title 49, which encompasses EPCA's preemption provision, as well as
EISA.\117\ NHTSA therefore has 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. As explained here, the statute is clear on the question
of preemption, and NHTSA must carry it out. See Coventry Health Care of
Missouri, Inc. v. Nevils, 137 S. Ct. 1190, 1193 n.3 (2017) (holding
that preemption applies and ``the statute alone resolves this
dispute''). However, to the extent there is any ambiguity, NHTSA is the
expert agency and its regulation adopted in this document is entitled
to deference.\118\ As explained in the proposal, NHTSA is the expert
agency given authority to administer the Federal fuel economy program
and has expert authority to interpret and apply the requirements of
EPCA, including preemption. See Medtronic, Inc. v. Lohr, 518 U.S. 470
(1996) (``Because the FDA is the federal agency to which Congress has
delegated its authority to implement the provisions of the Act, the
agency is uniquely qualified to determine whether a particular form of
state law `stands as an obstacle to the accomplishment and execution of
the full purposes and objectives of Congress,' Hines v. Davidowitz, 312
U.S. 52, 67, 61 S. Ct. 399, 404, 85 L. Ed. 581 (1941), and, therefore,
whether it should be pre-empted.''); see also Nat'l Rifle Ass'n v.
Reno, 216 F.3d 122 (D.C. Cir. 2000) (rejecting argument that Attorney
General lacked authority to issue regulation that she described as
clarifying that certain State requirements were not preempted by
Federal law). This is particularly true given the scientific nature of
the relationship between fuel economy and greenhouse gas emissions. See
Geier v. Am. Honda Motor Co., Inc., 529 U.S. 861 (2000) (``Congress has
delegated to DOT authority to implement the statute; the subject matter
is technical; and the relevant history and background are complex and
extensive. The agency is likely to have a thorough understanding of its
own regulation and its objectives and is `uniquely qualified' to
comprehend the likely impact of state requirements.'').
---------------------------------------------------------------------------

    \115\ Id.; Center for Biological Diversity et al., Docket No.
NHTSA-2018-0067-12000; Joint Submission from the States of
California et al. and the Cities of Oakland et al., Docket No.
NHTSA-2018-0067-11735; South Coast Air Quality Management District,
Docket No. NHTSA-2018-0067-11813.
    \116\ 49 U.S.C. 322(a) specifically states: ``The Secretary of
Transportation may prescribe regulations to carry out the duties and
powers of the Secretary. An officer of the Department of
Transportation may prescribe regulations to carry out the duties and
powers of the officer.''
    \117\ 49 CFR 1.95(a), (j).
    \118\ See, e.g., Chevron USA, Inc. v. Nat'l Res. Defense
Council, Inc., 467 U.S. 837, 843-45 (1984).
---------------------------------------------------------------------------

    NHTSA is also finalizing its view that its regulation concerning
EPCA preemption is independent and severable from any particular CAFE
standards adopted by NHTSA. NHTSA's implementation of its authority to
set nationally applicable fuel economy standards under 49 U.S.C. 32902,
by clarifying the scope of preemption, is separate from its decision on
the appropriate standards for any given model years. No commenter
disagreed that this portion of the proposed rule is severable. The
Alliance of Automobile Manufacturers agreed, noting case law stating
that whether a regulation is severable depends on the agency's intent
and whether the remainder of the regulation may still function
sensibly.\119\ Both these considerations support severability here.
Given the lack of any comments to the contrary, NHTSA is finalizing its
conclusion that the standards for model year 2021 through 2026
automobiles are independent of and severable from the decision NHTSA is
finalizing in this document on EPCA preemption. Moreover, given the
need for clarity on preemption, and in order to give effect to existing
standards established pursuant to 49 U.S.C. 32902, NHTSA is issuing
this final rule now before making a final determination on the
standards portion of the proposal.
---------------------------------------------------------------------------

    \119\ Alliance of Automobile Manufacturers, Docket No. NHTSA-
2018-0067-12073.
---------------------------------------------------------------------------

E. Direct and Substantial Relationship Between ZEV Mandates and Fuel
Economy Standards

    NHTSA is also finalizing its conclusion that a State law or
regulation that either explicitly prohibits tailpipe carbon dioxide
emissions from automobiles or has the direct or substantial effect of
doing so is preempted, both pursuant to the express preemption
provision in 49 U.S.C. 32919 and implied preemption, as an obstacle to
NHTSA's national program pursuant to 49 U.S.C. 32901-32903.
    As explained in greater detail in the proposal, carbon dioxide
emissions constitute the overwhelming majority of tailpipe carbon
emissions.\120\ The only feasible way of eliminating tailpipe carbon
dioxide emissions altogether is to eliminate the use of fossil fuel.
Thus, regulations that require a certain number or percentage of a
manufacturer's fleet of vehicles sold in a State to be ZEVs that
produce no carbon dioxide tailpipe emissions necessarily affect the
fuel economy achieved by the manufacturer's fleet as well as the
manufacturer's strategy to comply with applicable standards, and are
therefore preempted under EPCA. These regulations therefore have just
as a direct and substantial impact on corporate average fuel economy as
regulations that explicitly eliminate carbon dioxide emissions, and are
therefore preempted. NHTSA described types of ZEV mandates in detail in
its proposal, including California's ZEV mandate, which has been
adopted by ten other States.\121\
---------------------------------------------------------------------------

    \120\ 83 FR 42986, 43234 (Aug. 24, 2018).
    \121\ See id. at 43239. At the time of the proposal, nine States
had adopted California's ZEV mandate. Since that time, a tenth
State--Colorado--has also done so. https://www.colorado.gov/pacific/cdphe/aqcc (indicating that ZEV standards were adopted on August 16,
2019).
---------------------------------------------------------------------------

    ZEV mandates force the development and commercial deployment of
ZEVs, irrespective of the technological feasibility or economic
practicability of doing so. The Alliance of Automobile Manufacturers
commented that this interference with NHTSA's balancing of

statutory factors and forced adoption of specific design approaches are
grounds for finding ZEV mandates preempted.\122\ NHTSA agrees.
---------------------------------------------------------------------------

    \122\ Alliance of Automobile Manufacturers, Docket No. NHTSA-
2018-0067-12073.
---------------------------------------------------------------------------

    In setting fuel economy standards, among the factors that NHTSA
must consider are technological feasibility and economic
practicability. 49 U.S.C. 32902(f). NHTSA is also required to set
performance-based standards, and not design mandates.\123\ See 49
U.S.C. 32902(b)(2). These considerations are at odds with ZEV mandates.
---------------------------------------------------------------------------

    \123\ South Coast asserts that ZEV mandates are performance
based because any vehicle meeting the requirements can be certified
as a ZEV. South Coast Air Quality Management District, Docket No.
NHTSA-2018-0067-11813. But, it is inherent that the requirements--
ZEV means zero-emissions vehicle--dictate a particular design. In
any event, for the reasons described above, ZEV mandates are related
to fuel economy standards however framed.
---------------------------------------------------------------------------

    NHTSA disagrees with comments that expressed the view that ZEV
mandates are not related to fuel economy standards because ZEVs emit no
criteria pollutants or greenhouse gases.\124\ Just as a State may not
require a specific level of tailpipe carbon dioxide emissions from
automobiles, since doing so effectively sets a specific level of fuel
economy, a State may not prohibit tailpipe carbon dioxide emissions
from automobiles. That is the equivalent of setting a specific
emissions level--zero, which also prohibits the use of fossil fuel. In
fuel economy terms, that is akin to requiring a vehicle to having the
maximum conceivable level of fuel economy. A prohibition on ozone-
forming emissions has the same effect, since the only vehicles capable
of emitting no ozone-forming emissions are vehicles that do not use
fossil fuels. As NHTSA explained, this type of regulation poses a
direct conflict with EPCA, particularly as it relates to requiring a
percentage of technological fleet penetration--represented by credits
or actual vehicles--that an automaker must distribute into a State. ZEV
mandates force investment in specific technology (battery electric and
fuel cell technology) rather than allowing manufacturers to improve
fuel economy by whatever technological path they choose, allowing them
to pursue more cost-effective technologies that better reflect consumer
demand, as is the case under the CAFE program. ZEV mandates also create
an even more fractured regulatory regime. As NHTSA explained in the
proposal, manufacturers must satisfy ZEV mandates in each State
individually.\125\
---------------------------------------------------------------------------

    \124\ South Coast Air Quality Management District, Docket No.
NHTSA-2018-0067-11813.
    \125\ 83 FR 42986, 43239 (Aug. 24, 2018); see Competitive
Enterprise Institute, Docket No. NHTSA-2018-0067-12015.
---------------------------------------------------------------------------

    NHTSA also disagrees with a comment that argued ZEV mandates are
not preempted because the definition of fuel economy in EPCA is in
reference to gasoline or equivalent fuel.\126\ EPCA preempts State and
local requirements related to fuel economy standards. That ZEV mandates
are not themselves expressed as mile-per-gallon standards for fossil-
fuel powered vehicles is not dispositive. NHTSA explained the
relationship between ZEV mandates and fuel economy standards in detail
in the proposal and reiterates that discussion here.\127\
---------------------------------------------------------------------------

    \126\ California Air Resources Board (CARB), Docket No. NHTSA-
2018-0067-11873.
    \127\ See 83 FR 42986, 43238-39 (Aug. 24, 2018).
---------------------------------------------------------------------------

    Many commenters expressed support for ZEV mandates as matter of
policy.\128\ NHTSA does not take issue with those policy objectives to
the extent they do not conflict with EPCA or otherwise impermissibly
interfere with the Federal regulation of fuel economy. NHTSA notes that
States and local governments are able to continue to encourage ZEVs in
many different ways, such as through investments in infrastructure and
appropriately tailored incentives.\129\ States and local governments
cannot adopt or enforce regulations related to fuel economy standards,
which include ZEV mandates, but they are able to pursue their policy
preferences, as long as the manner in which they do so does not
conflict with Federal law.
---------------------------------------------------------------------------

    \128\ National Coalition for Advanced Transportation (NCAT),
Docket No. NHTSA-2018-0067-11969; Union of Concerned Scientists,
Docket No. NHTSA-2018-0067-12039.
    \129\ Certain incentives are preempted by EPCA. See Metro.
Taxicab Bd. of Trade v. City of New York, 615 F.3d 152 (2d Cir.
2010) (holding that New York City rule that incentivized hybrid
taxis by allowing taxi owners to charge more for the lease of hybrid
vehicles were ``based expressly on the fuel economy of a leased
vehicle, [and] plainly fall within the scope of the EPCA preemption
provision.'').
---------------------------------------------------------------------------

F. EISA Did Not Narrow or Otherwise Alter EPCA Preemption

    NHTSA reiterates, as it discussed in the proposal, that EISA did
not narrow the express preemption clause in 49 U.S.C. 32919. In fact,
EISA did not alter EPCA's express preemption clause in any way. As a
factual matter, Congress neither amended or nor repealed EPCA's
preemption clause with the enactment of EISA. EISA's savings clause did
not amend EPCA. The savings clause, codified at 42 U.S.C. 17002,
states: ``Except to the extent expressly provided in this Act or an
amendment made by this Act, nothing in this Act or an amendment made by
this Act supersedes, limits the authority provided or responsibility
conferred by, or authorizes any violation of any provision of law
(including a regulation), including any energy or environmental law or
regulation.'' \130\
---------------------------------------------------------------------------

    \130\ One commenter pointed out that the proposal did not
include the clause before the first comma when it quoted the
language of the savings provision. South Coast Air Quality
Management District, Docket No. NHTSA-2018-0067-11813. However,
NHTSA disagrees with the commenter that the introductory clause has
a substantive impact on this issue. That clause states: ``Except to
the extent expressly provided in this Act or an amendment made by
this Act . . .'' But, EISA did not expressly authorize States to
regulate or prohibit tailpipe greenhouse gas emissions from
automobiles.
---------------------------------------------------------------------------

    As described in the proposal, EISA's savings clause does not expand
any pre-existing authority. Instead, the clause expressly states that
it did not impose a new limitation on such authority. By its plain
text, EISA also does not authorize any violation of any provision of
law. This includes EPCA's express preemption clause. Thus, activities
prohibited by the express preemption clause before EISA, such as State
laws related to fuel economy standards, continued to be prohibited
after EISA.
    The text of the savings clause is what controls its meaning, not
statements by individual Members of Congress. South Coast claims that
NHTSA did not discuss such statements in detail, including statements
by Senator Feinstein.\131\ NHTSA did recognize in the proposal that the
Congressional Record contains statements by certain Members of Congress
about their individual views, but explained that such statements lack
authority. As NHTSA explained in the proposal, such statements cannot
expand the scope of the savings clause or clarify it. Individual
Members, even those who may have played a lead role in drafting a
particular bill, cannot speak for the body of Congress as a whole.\132\
NHTSA interprets the statutory language based on the words actually
adopted by both Houses and signed by the President.
---------------------------------------------------------------------------

    \131\ South Coast Air Quality Management District, Docket No.
NHTSA-2018-0067-11813.
    \132\ N.L.R.B. v. SW Gen., Inc., 137 S. Ct. 929, 942-43 (2017)
(``Passing a law often requires compromise, where even the most firm
public demands bend to competing interests. What Congress ultimately
agrees on is the text that it enacts, not the preferences expressed
by certain legislators. . . .[F]loor statements by individual
legislators rank among the least illuminating forms of legislative
history.'' (citations omitted)).
---------------------------------------------------------------------------

    NHTSA likewise does not find persuasive the argument that Congress
did not enact additional statutory language in EISA preempting
California from regulating tailpipe greenhouse gas

emissions from automobiles. A comment from three Senators provides
documents related to potential proposals to do so.\133\ There are many
reasons for Congress not to adopt proposals set forward by one interest
group or another, including, of course, because they were unnecessary.
That is the case here where EPCA's preemption provision already
prevented States from adopting and enforcing requirements related to
fuel economy standards.
---------------------------------------------------------------------------

    \133\ U.S. Senators Tom Carper, Diane Feinstein and Edward J.
Markey, Docket No. NHTSA-2018-0067-11938
---------------------------------------------------------------------------

    Given the words of the savings clause, NHTSA rejects the argument
made by South Coast that the ``EISA saving provision designedly narrows
EPCA's express preemption provision, and Congress intended this
result.'' \134\ The savings clause did not amend the preemption
provision in EPCA. Moreover, what the savings clause actually says is
that it does not limit authority. If a regulation is preempted by EPCA,
a State has no authority to enforce it, and EISA did not change that
status quo. If Congress wanted to amend the broad and clear express
preemption provision in EPCA, it could have and would have done so. It
did not.
---------------------------------------------------------------------------

    \134\ South Coast Air Quality Management District, Docket No.
NHTSA-2018-0067-11813.
---------------------------------------------------------------------------

    Because NHTSA disagrees that States could permissibly regulate
tailpipe greenhouse gas emissions from automobiles prior to EISA, it
also disagrees with comments that argue that Congress ``preserved'' the
ability of States to do so through the savings clause (or,
alternatively, that efforts to ``revoke'' such preexisting authority
failed).\135\
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    \135\ Joint Submission from the States of California et al. and
the Cities of Oakland et al., Docket No. NHTSA-2018-0067-11735.
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    NHTSA also disagrees with a comment by South Coast that argues that
EISA's savings provision forecloses implied preemption.\136\ The
specific words that South Coast points to are the opening clause:
``Except to the extent expressly provided in this Act or an amendment
made by this Act.'' This language does not address preemption under
EPCA. That introductory clause merely modifies the remainder of the
savings provision, which goes on to say that ``nothing in this Act or
an amendment made by this Act . . . limits the authority provided . . .
or authorizes any violation of any provision of law . . . .'' This
statutory language prevents EISA from limiting preexisting authority or
responsibility conferred by any law or from authorizing violation of
any law. States and local governments had no preexisting authority or
responsibility to set requirements related to fuel economy standards.
Such requirements are void ab initio. The savings provision also does
not purport to expand pre-existing authority or responsibility, nor did
Congress amend in any way the broad express preemption provision in
EPCA when it enacted EISA. Moreover, implied preemption as applied here
is not a limitation based in EISA or the Clean Air Act. Implied
preemption is instead based on the Secretary of Transportation's
preexisting responsibility under EPCA to balance statutory factors in
setting nationwide fuel economy standards for automobiles.
---------------------------------------------------------------------------

    \136\ South Coast Air Quality Management District, Docket No.
NHTSA-2018-0067-11813.
---------------------------------------------------------------------------

    The provision in EISA concerning minimum requirements for Federal
government vehicles also does not change NHTSA's view. Several comments
referenced this provision, which states that the EPA ``Administrator
shall take into account the most stringent standards for vehicle
greenhouse gas emissions applicable to and enforceable against motor
vehicle manufacturers for vehicles sold anywhere in the United States''
in identifying vehicles for the Federal government fleet. 42 U.S.C.
13212(f)(3)(B).\137\ Commenters argued that the phrase ``the most
stringent standards'' would be superfluous if only EPA were allowed to
set standards and, in addition, if EPA had not set any such standards
at the time EISA was enacted. On the contrary, this provision is fully
consistent with NHTSA's view of preemption, based on the plain text of
EPCA's express preemption provision. The language in the EISA provision
specifically indicates that it applies only to ``the most stringent
standards . . . enforceable against motor vehicle manufacturers.''
\138\ This means that EPA could consider only otherwise lawful
standards. States and local governments are not permitted to enforce
standards preempted by EPCA. 49 U.S.C. 32919(a).
---------------------------------------------------------------------------

    \137\ California Air Resources Board (CARB), Docket No. NHTSA-
2018-0067-11873; Joint Submission from the States of California et
al. and the Cities of Oakland et al., Docket No. NHTSA-2018-0067-
11735.
    \138\ 42 U.S.C. 13212(f)(3)(B) (emphasis added).
---------------------------------------------------------------------------

    However, EPCA does specifically permit a State or local government
to ``prescribe requirements for fuel economy for automobiles obtained
for its own use.'' 49 U.S.C. 32919(c). It is logical that the Federal
government would consider the requirements for States and local
government vehicle fleets in evaluating vehicles for its own Federal
government fleet. Such requirements would be applicable to and could be
enforced against manufacturers in contractual procurement relationships
with States or local governments. In any event, this provision
concerning a limited set of vehicles (Federal government vehicles) is
not grounds for undoing the uniform national fuel economy standards
applicable to all light vehicles as prescribed by Congress in EPCA.
    In enacting this provision in EISA, Congress required the EPA
Administrator to ``issue guidance identifying the makes and model
number of vehicles that are low greenhouse gas emitting vehicles'' to
aid in identifying vehicles for the Federal government's own fleet. 42
U.S.C. 13212(f)(3)(A). The provision requiring the Administrator to
``take into account the most stringent standards for vehicles
greenhouse gas emissions'' provides a consideration for that guidance.
Id. 13212(f)(3)(B). It is not plausible that Congress intended this
limited provision concerning guidance on Federal government procurement
to disrupt the longstanding express preemption provision in EPCA.
    Further, to read this procurement-related provision as somehow
showing that Congress intended to allow California to establish laws
related to fuel economy standards is unreasonable, as doing so would
put California in an unequal setting vis-a-vis other states, and that
would not make sense in this context. ``The Act also differentiates
between the States, despite our historic tradition that all the States
enjoy `equal sovereignty.' '' Northwest Austin Municipal Utility
District Number One v. Holder, 557 U.S. 193, 203 (2009). A ``departure
from the fundamental principal of equal sovereignty requires a showing
that a statute's disparate geographic coverage is sufficiently related
to the problem that it targets.'' Id. Congress rejected any such
prospect in the area of fuel economy by adding an unwaivable preemption
clause in EPCA. NHTSA does not presume that Congress, when adopting
EISA, impliedly discarded the equal application of EPCA to the States
without a clear statement of intent to do so and a recitation of the
``extraordinary conditions'' permitting California special authority
related to fuel economy. Id. at 211. ``Congress . . . does not alter
the fundamental details of a regulatory scheme in vague terms or
ancillary provisions--it does not, one might say, hide elephants in
mouseholes.'' \139\
---------------------------------------------------------------------------

    \139\ Whitman v. Am. Trucking Ass'ns, 531 U.S. 457, 468 (2001).

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G. Prior Case Law Does Not Preclude Preemption

    Certain comments opposed to NHTSA's proposal rely upon the Supreme
Court's decision in Massachusetts v. EPA to argue that regulation of
tailpipe emissions is separate and distinct from regulation of fuel
economy.\140\ NHTSA disagrees with attempts to stretch the holding of
this decision well beyond the issues addressed by the Court. The Court
did not address EPCA preemption in Massachusetts v. EPA, or State
regulations pursuant to a Clean Air Act waiver. The Court addressed
only EPA's own statutory obligations, which have no bearing on EPCA
preemption.
---------------------------------------------------------------------------

    \140\ California Air Resources Board (CARB), Docket No. NHTSA-
2018-0067-11873; see Northeast States for Coordinated Air Use
Management (NESCAUM), Docket No. NHTSA-2018-0067-11691.
---------------------------------------------------------------------------

    Moreover, as discussed above, NHTSA and EPA conduct joint
rulemaking consistent with the Supreme Court's decision. The Court
acknowledged that NHTSA and EPA's statutory obligations may overlap,
but that the agencies may both administer those obligations while
avoiding inconsistency.\141\ NHTSA therefore disagrees with the
comment's assertion that regulations of tailpipe greenhouse gas
emissions and fuel economy are truly separate and distinct. The
agencies issue joint rules precisely because of the unavoidable
scientific relationship between the two.
---------------------------------------------------------------------------

    \141\ Massachusetts v. EPA, 549 U.S. 497, 532 (2007).
---------------------------------------------------------------------------

    A number of comments also rely on the prior district court
decisions in California and Vermont in opposing NHTSA's proposal on
preemption.\142\ As NHTSA discussed in the proposal, those courts
previously concluded that State tailpipe greenhouse gas emissions
standards were not preempted by EPCA.\143\ NHTSA continues to disagree
with both of these district court decisions, as described in detail in
the proposal.\144\ This includes the California district court's
erroneous view of the requirement in EPCA for NHTSA to consider ``other
standards'' in setting fuel economy standards.\145\ In reaching its
conclusion, the court misconstrued a separate provision of EPCA that,
by its explicit terms, has had no effect for decades. Importantly,
neither district court considered NHTSA's views on preemption in
construing the statute NHTSA administers.\146\ Although the United
States filed an amicus brief opposing the Vermont court's decision in
the Second Circuit, that appeal was not decided on the merits due to
the automotive industry's withdrawal of the appeal as a part of a
negotiated agreement connected to the national framework. In its brief,
the United States specifically raised the district court's failure to
consider NHTSA's views concerning preemption, let alone give them
weight.\147\ Withdrawal of appeals was expressly part of the agreement
to establish the national framework.
---------------------------------------------------------------------------

    \142\ Joint Submission from the States of California et al. and
the Cities of Oakland et al., Docket No. NHTSA-2018-0067-11735;
South Coast Air Quality Management District, Docket No. NHTSA-2018-
0067-11813.
    \143\ 83 FR 42986, 43235 (Aug. 24, 2018).
    \144\ Id. at 43235-38.
    \145\ Id. at 43236-37.
    \146\ Id. at 43236; Proof Brief for the United States as Amicus
Curiae, 07-4342-cv (2d Cir. filed Apr. 16, 2008).
    \147\ See Proof Brief for the United States as Amicus Curiae,
07-4342-cv (2d Cir. filed Apr. 16, 2008). NHTSA also was not a
litigant in the district court cases and, therefore, did not have a
full opportunity to raise its views.
---------------------------------------------------------------------------

    The Vermont district court also attempted to reconcile EPCA and the
Clean Air Act by asserting that a Clean Air Act waiver converts State
requirements to ``other motor vehicle standards'' that NHTSA must
consider in setting fuel economy standards. As NHTSA noted in the
proposal, even the California district court found that there was no
legal foundation for the view that a State regulation pursuant to a
Clean Air Act waiver becomes the equivalent of a Federal
regulation.\148\ This is an erroneous finding not based on precedent
and is unsupported by applicable law.
---------------------------------------------------------------------------

    \148\ 83 FR 42986, 43236 (Aug. 24, 2018).
---------------------------------------------------------------------------

    As described in the proposal, NHTSA also disagrees with the
California and Vermont district courts' implied preemption
analyses.\149\ NHTSA does not believe those courts fully considered the
conflict posed by State regulations and, in one case, even went so far
as to assert erroneously that NHTSA could simply defer to California in
revising its standards.\150\ Those decisions are not binding on NHTSA.
---------------------------------------------------------------------------

    \149\ Id. at 43238.
    \150\ Cent. Valley Chrysler-Jeep, Inc., 529 F. Supp. 2d at 1179.
NHTSA has a statutory obligation to set standards at ``the maximum
feasible average fuel economy level that the Secretary decides the
manufacturers can achieve in that model year,'' in accordance with
the statutory considerations. 49 U.S.C. 32902(a), (f). Thus, NHTSA
cannot simply defer to a State. For example, the only standards that
California would permit to satisfy California requirements for model
years 2021 through 2025 are the augural standards. See Cal. Code
Regs. tit. 13, Sec.  1961.3(c). If NHTSA finalizes a determination
that the augural standards are not ``maximum feasible,'' as
discussed in the proposal, then it would be contrary to law for
NHTSA to nevertheless adopt them in deference to California.
---------------------------------------------------------------------------

    Given NHTSA's previously stated views on those decisions, arguments
that rely on the decisions are not persuasive. Commenters did not
provide any new information or analysis of those district court
decisions that caused the agency to change its view on the
decisions.\151\ NHTSA incorporates the prior discussion of those
decisions from the proposal here.
---------------------------------------------------------------------------

    \151\ As noted by a commenter, the appeals were dismissed before
decision as a practical matter, and despite strong arguments on the
merits. Fiat Chrysler Automobiles (FCA), Docket No. NHTSA-2018-0067-
11943.
---------------------------------------------------------------------------

    While NHTSA need not belabor its views again here, it is worth
emphasizing, as did commenters, that both district courts ignored
NHTSA's published prior statements on preemption in rendering their
decisions.\152\ Some comments seem to suggest that this failure to
address NHTSA's views represents a substantive rejection of those
views.\153\ NHTSA disagrees. The district courts simply entirely failed
to consider the agency's views; they did not consider and reject them
or even find that they were not due any weight. This is among the
reasons that NHTSA is formalizing its views in a regulation. As the
expert agency charged with administering EPCA, NHTSA is tasked with
balancing the four statutory factors in determining the ``maximum
feasible average fuel economy standards'' for each model year.\154\ In
doing so, NHTSA has the unique ability to determine whether State or
local regulations would undermine this balancing.\155\ NHTSA's views on
preemption certainly should be considered by any court evaluating this
issue. This is particularly true given that the relationship between
fuel economy standards and greenhouse gas emissions is a matter of
science.
---------------------------------------------------------------------------

    \152\ 83 FR 42986, 43236 (Aug. 24, 2018).
    \153\ See California Air Resources Board (CARB), Docket No.
NHTSA-2018-0067-11873.
    \154\ 49 U.S.C. 32902(f).
    \155\ See id.
---------------------------------------------------------------------------

    One commenter also erroneously asserts that collateral estoppel
will bar the Department of Justice from defending a final rule that
asserts State greenhouse gas emissions regulations are preempted by
EPCA.\156\ Nonmutual offensive collateral estoppel does not apply to
the United States. United States v. Mendoza, 464 U.S. 154, 162 (1984).
Moreover, the Federal government was not even a party to the prior
litigation involving EPCA preemption. The assertion that the Department
of Justice would be barred from defending this final rule lacks merit.
---------------------------------------------------------------------------

    \156\ See South Coast Air Quality Management District, Docket
No. NHTSA-2018-0067-11813.

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

H. A Clean Air Act Waiver and SIP Approvals Do Not Foreclose EPCA
Preemption

    Both agencies are finalizing their tentative conclusion from the
proposal that a Clean Air Act waiver does not also foreclose EPCA
preemption. EPCA does not provide for a waiver of preemption, either by
NHTSA or by another Federal agency. EPA, like NHTSA, does not have the
authority to waive EPCA preemption. Therefore, its grant of a Clean Air
Act waiver cannot operate to waive EPCA preemption. NHTSA discussed the
basis for its view that a Clean Air Act waiver does not ``federalize''
EPCA-preempted State requirements in detail in its proposal. NHTSA
reaffirms that discussion.
    Several comments recited the district court's holding in Green
Mountain Chrysler that it need not consider EPCA preemption due to the
EPA waiver.\157\ NHTSA discussed in detail in the proposal its reasons
for disagreeing with that decision and commenters did not identify any
new information that caused NHTSA to change its view. NHTSA agrees with
commenters that reject the flawed reasoning of the district court.\158\
As one commenter explained, the argument that an EPA waiver federalizes
State requirements renders the EPCA preemption provision a
nullity.\159\ As the commenter noted, this incorrect interpretation
would enable States to even issue explicit fuel economy requirements so
long as they were under cover of a waiver from EPA. EPA does not have
authority to waive any aspect of EPCA preemption, nor does NHTSA.
---------------------------------------------------------------------------

    \157\ See, e.g., California Air Resources Board (CARB), Docket
No. NHTSA-2018-0067-11873; Class of 85 Regulatory Response Group,
Docket No. NHTSA-2018-0067-12070; Joint Submission from the States
of California et al. and the Cities of Oakland et al., Docket No.
NHTSA-2018-0067-11735.
    \158\ See, e.g., American Fuel & Petrochemical Manufacturers,
Docket No. NHTSA-2018-0067-12078.
    \159\ Competitive Enterprise Institute, Docket No. NHTSA-2018-
0067-12015.
---------------------------------------------------------------------------

    NHTSA also finalizes its view that preempted standards are void ab
initio. No commenters presented information that altered NHTSA's view,
which is based on longstanding Supreme Court case law, as cited by the
proposal.
    NHTSA agrees with South Coast, which suggested in its comments that
EPCA does not outweigh the Clean Air Act.\160\ Likewise, the Clean Air
Act does not outweigh EPCA. Just as manufacturers must comply with
requirements under both statutes, both statutes apply to State and
local governments as well. Moreover, EPCA's preemption provision is
fully consistent with the Clean Air Act. EPCA's preemption provision
does not implicitly repeal parts of Section 209(b), contrary to the
assertion in one comment.\161\ States must simply act in accordance
with both statutes. Cf. Massachusetts v. EPA, 549 U.S. 497, 532 (2007)
(finding no inconsistency between obligations of EPA under Clean Air
Act and NHTSA under EPCA).
---------------------------------------------------------------------------

    \160\ See South Coast Air Quality Management District, Docket
No. NHTSA-2018-0067-11813.
    \161\ Joint Submission from the States of California et al. and
the Cities of Oakland et al., Docket No. NHTSA-2018-0067-11735.
---------------------------------------------------------------------------

    NHTSA has rejected the argument that a Clean Air Act waiver renders
EPCA preemption inapplicable, and likewise rejects the even more
attenuated argument concerning EPA's approval of preempted State
requirements as a part of a State Implementation Plan (SIP) submission
for areas that do not meet National Ambient Air Quality Standards
(NAAQS). A State has no authority to adopt or enforce a requirement
that falls within the scope of EPCA preemption. 49 U.S.C. 32919(a).
This is true even if adopting the unlawfully enacted requirement would
assist the State in coming into compliance with the NAAQS. The
inclusion of an invalid fuel economy requirement in an air quality SIP
does not render the requirement suddenly valid.\162\ NHTSA therefore
disagrees with comments that suggest that EPCA preemption no longer
applies simply because an unauthorized requirement is included in a SIP
that is subsequently approved.\163\ It is inappropriate for a State to
take action unauthorized and rendered void by one statutory scheme to
meet the requirements of a different statutory scheme.
---------------------------------------------------------------------------

    \162\ SIPs must include ``enforceable emission limitations.'' 42
U.S.C. 7410(a)(2)(A). An EPCA preempted requirement is not
enforceable. 49 U.S.C. 32919(a).
    \163\ See South Coast Air Quality Management District, Docket
No. NHTSA-2018-0067-11813.
---------------------------------------------------------------------------

    Moreover, EPCA preemption applies directly to States and local
governments which are obliged to adhere to the constraints of the
Supremacy Clause. EPCA explicitly prohibits States and local
governments from adopting or enforcing a law or regulation related to
fuel economy standards. It is unreasonable for States to expect a
Federal agency (EPA) acting under one statutory scheme (the Clean Air
Act) to analyze whether the State has adopted preempted regulations in
contravention of an entirely separate statute (EPCA) administered by a
different Federal agency (NHTSA). In fact, as noted above, historically
EPA has declined to address questions unrelated to CAA section 209,
such as preemption analysis, in its waiver decisions. NHTSA strongly
disagrees with the assertion that EPA's approval of a SIP silently acts
as an implied waiver of EPCA preemption. This suggestion is
particularly hollow given that neither EPA nor NHTSA has the authority
to waive EPCA preemption.
    NHTSA agrees with the general principle that an approved SIP is
enforceable as a matter of Federal law.\164\ However, the case law does
not support the argument made by CARB and South Coast's comments. The
case law explains that a SIP approved by EPA creates binding
obligations, pursuant to the Clean Air Act.\165\ There is no indication
that Congress intended to permit one agency to legitimize an otherwise
EPCA-preempted State provision by ``federalizing'' it. As an analogy,
the IRS requires individuals to report and pay taxes on money earned
from illegal activity, such as dealing drugs.\166\ A drug dealer who
complies with Federal tax law is not relieved of the prohibitions on
possessing and selling drugs that apply under other Federal laws.