ARTBA & AGC Question Federal Highway Administration’s Statutory Authority to Require Greenhouse Gas Performance Reports from States

WASHINGTON, D.C. – Oral arguments are beginning now regarding The American Road & Transportation Builders Association and the Associated General Contractors of America’s jointly filed amicus briefs in support of 22 states challenging the Biden Administration’s new greenhouse gas performance measure for state transportation departments.

The two associations note that the new rule is likely to divert resources from vital new infrastructure projects and the Federal Highway Administration lacks the statutory authority to impose the measure.

The briefs, which were filed on Feb. 16 in Federal District Courts in Kentucky and Texas, back state challenges to a new greenhouse gas performance measure regulation that was imposed Dec. 7 by FHWA.

Supporting the plaintiff states motions for summary judgment, the two national construction associations highlighted the absence of congressional intent and statutory authority for the rulemaking. They emphasized that Congress had debated and rejected the inclusion of this mandate from the 2021 Infrastructure Investment and Jobs Act.

The greenhouse gas rule requires state transportation departments to set and report on two-year and four-year statewide emissions reduction targets as part of the planning process for highway and bridge projects. States must set initial targets by spring of this year, with subsequent targets due by Oct. 1, 2026. Those states failing to meet these goals must submit updated plans to FHWA outlining actions to achieve them. While FHWA claims states won’t face explicit penalties, AGC and ARTBA noted concerns of plaintiff states that mandating GHG reductions will limit the types of projects they can undertake in the future. The two associations also noted states may need to divert funding for unplanned administrative costs to comply with the rule.

Attorneys general from 21 states sued FHWA Dec. 22, 2023 in Kentucky Federal District Court, while Texas sued separately Dec. 19, 2023.

“Had Congress intended to grant FHWA authority to enact this mandate, it would have included it in the legislation,” said Dave Bauer, ARTBA’s president and CEO. “We believe that unless there is a clear congressional directive, states should – and can – make these types of policy decisions themselves.”

“This new mandate puts pressure on state officials to shift funding away from needed new infrastructure projects to lower priority projects so their reports can look better,” said Stephen E. Sandherr, chief executive officer of the Associated General Contractors of America. “The president and his team don’t have the authority to create measures that Congress specifically reviewed and rejected.”

Oral arguments in both cases are expected by the end of March, with decisions anticipated soon after.