Comparison of House and Senate Proposals on Preemption

In the House-passed legislation, the preemption triggering event is when EPA issues § 6 rule or determines that substance does not present an unreasonable risk. Preemption is absolute at that point, in that it applies to new or existing state requirements except that:

• States can co-enforce requirements (but no duplicative penalties)
• Regulations can be adopted pursuant to Federal Law
• Actions can continue to be brought pursuant to state tort and contracts law
• Implementation of California’s Prop 65 is not affected
• The House Report accompanying the legislation also states that state information requirements generally are not intended to be preempted.

The House-passed bill makes clear that a state action is preempted and cannot continue in effect if it “actually conflicts” with an action taken by EPA.  

With respect to the Senate-passed legislation, states can regulate a high priority substance substance until EPA defines the scope of its safety assessment for the chemical. At that point, the Senate-passed bill requires a “pause” in new state laws which ends at the earlier of the deadline for issuing the safety determination or when the safety determination is published. If EPA determines that the chemical does not meet the safety standard, this has the practical effect of allowing a State to again take action on the chemical and avoid preemption until EPA imposes restrictions, at which point preemption would kick-back in. It could lead to a “start-stop-start-stop” effect.  

Example: Assume that a State adopts a “new” standard that bans a chemical. That ban can stay in place until EPA publishes the scope of the safety assessment. The ban would then be preempted until the safety determination is made (or the applicable deadline passes). At that point, the State could reinstitute the ban if EPA finds that the chemical does not meet the safety standard. The ban, now on its second round, would continue in effect (for several years at least) until EPA imposes restrictions.  

Once EPA issues a § 6 rule, the Senate-passed bill calls for absolute preemption (both new and existing state requirements) except that the following activities may continue:

• States can co-enforce requirements (no duplicative penalties)
• Regulations adopted pursuant to Federal Law
• Actions pursuant to state tort and contracts law
• Implementation of California’s Prop 65
• State information requirements (explicit in statute) 

The intent of the Senate language that nothing in the grandfather clause affects the relationship between federal and State law under any other federal law is not entirely clear (i.e., it is not clear whether conflict preemption would apply to grandfathered State actions under the Senate version). As currently drafted, this language brings into question whether conflict preemption is a viable defense.

With respect to the low priority designations envisioned in the Senate-passed bill, these have no preemptive effect. This is confirmed by Senate Committee Report 114-67, p. 28 (Jun. 18, 2015):

• The section [Section 17. State-Federal relationship] authorizes any person to seek judicial review of an EPA decision to designate a substance as a low priority chemical. The Committee expects that if EPA applies the low priority designation based on information sufficient to establish that the chemical substance is likely to meet the safety standard, judicial review of a low priority designation will be sought infrequently, particularly as the ability of state governments to act on all chemical substances not designated as a high priority remains intact because low priority determinations have no preemptive or regulatory affect.