As Trump Dismantles Clean Air Rules, an Industry Lawyer Delivers for Ex-Clients

Source: By Eric Lipton, New York Times • Posted: Monday, August 20, 2018

William Wehrum has been able to push his deregulatory agenda because of a quirk in federal ethics rules that are less restrictive for industry lawyers than for officials who had worked as registered lobbyists.Ron Sachs/CNP/MediaPunch

WASHINGTON — As a corporate lawyer, William L. Wehrum worked for the better part of a decade to weaken air pollution rules by fighting the Environmental Protection Agency in court on behalf of chemical manufacturers, refineries, oil drillers and coal-burning power plants.

Now, Mr. Wehrum is about to deliver one of the biggest victories yet for his industry clients — this time from inside the Trump administration as the government’s top air pollution official.

On Tuesday, President Trump is expected to propose a vast rollback of regulations on emissions from coal plants, including many owned by members of a coal-burning trade association that had retained Mr. Wehrum and his firm as recently as last year to push for the changes.

The proposal strikes at the heart of climate-change regulations adopted by the Obama administration to force change among polluting industries, and follows the relaxation of separate rules governing when power plants must upgrade air pollution equipment. Mr. Wehrum, who has led the E.P.A.’s clean air office since November, also helped deliver the changes in several of those rules.

The rollbacks are part of the administration’s effort to bring regulatory relief to the coal industry, and other major sources of air pollution. But to proponents of a tougher stance on industries that contribute to global warming, Mr. Wehrum is regarded as the single biggest threat inside the E.P.A., with Tuesday’s expected announcement to weaken what is known as the Clean Power Plan the most recent evidence of his handiwork.

“They basically found the most aggressive and knowledgeable fox and said, ‘Here are the keys to the henhouse,’” said Bruce Buckheit, an air pollution expert who worked for the Justice Department’s Environmental Enforcement Section and as director of the E.P.A.’s air enforcement office under Democratic and Republican presidents.

Mr. Wehrum has been able to push his deregulatory agenda without running into ethics troubles because of a quirk in federal ethics rules. The rules limit the activities of officials who join the government from industry — but they are less restrictive for lawyers than for officials who had worked as registered lobbyists.

The end result is that the ethics rules generally allow Mr. Wehrum to help oversee the drafting of policies that broadly benefit the industries or clients he represented in recent years.

“It is a failing in the rule,” said Norman Eisen, a former Obama administration lawyer who wrote the White House ethics code that creates the division between how ex-lawyers and ex-lobbyists are treated. “One is subject to the tougher lobbying restriction, and the other skates through.”

In an interview, Mr. Wehrum said he was following the rules carefully, and even some critics say he generally seems to be obeying the letter of the law. “I am scrupulously complying with my ethical obligations,” he said, adding that he signed Mr. Trump’s so-called ethics pledge in November, committing himself to honor all such rules.

A DTE Energy Company power plant in Monroe, Mich. The company was a client of Mr. Wehrum’s law firm. He is now at the heart of a rollback in coal emissions.Jeff Kowalsky/Bloomberg

Jeffrey R. Holmstead, the lawyer for the electric utility industry who has known Mr. Wehrum for over two decades and who served as his boss at the E.P.A. during the Bush administration, said environmentalists misunderstood Mr. Wehrum and falsely attempted to paint him as a villain.

“What he really does care about is good regulatory policy,” Mr. Holmstead said. “And that means making sure the programs are as efficient and effective as possible so collectively we are not paying more than we need to for the environmental protection that we have and that we need.”

Mr. Wehrum’s client list over the last decade is a testament to his clout — and a road map to the potential conflicts as a government official.

Mr. Wehrum has represented major industrial companies like Koch Industries, the diversified conglomerate that sells everything from petrochemicals to asphalt, and Diageo, one of the world’s largest makers of spirits, including Smirnoff vodka and Baileys Irish Cream. His clients have included the industry’s largest trade associations: the American Petroleum Institute, the American Fuel and Petrochemical Manufacturers, the Brick Industry Association and the Utility Air Regulatory Group, whose membership list features coal-burning electric utilities.

Mr. Wehrum’s trip through the revolving door is hardly extraordinary in the Trump administration, where dozens of former lobbyists and industry lawyers now help oversee the same industries they once represented, including Andrew Wheeler, the acting agency administrator.

But in few cases have the actions pushed by these just-departed industry executives seemed to offer such rapid and far-reaching benefits to ex-clients, and Mr. Wehrum has taken the steps even as he continues at times to meet privately with them despite federal ethics rules intended to limit such interactions.

The overlap between Mr. Wehrum’s work for the industry and his efforts since he arrived at the E.P.A. is perhaps best illustrated by a 13-page petrochemical industry memo that was shared with the E.P.A. air pollution office a week before Mr. Wehrum was confirmed by the Senate.

The memo, which detailed a series of “regulatory changes that would be most beneficial to the refining and petrochemical sector,” almost reads like a playbook for the 10 months since Mr. Wehrum arrived at the E.P.A. At least three of the major changes on the industry wish list have become or are in the process of becoming official agency policy with the help of Mr. Wehrum and his office.

The primary author of the memo, written in October, was an industry consultant named Kenneth Weiss, but the document formed the basis of a presentation Mr. Wehrum gave on behalf of his industry clients late last year, an email sent to the E.P.A. said. The memo listed Mr. Wehrum’s name at the top, in his capacity as outside counsel to the American Fuel and Petrochemical Manufacturers association, a group whose executive committee includes corporate officers from Valero Energy, Marathon Petroleum and Chevron.

The agency has also agreed to no longer “second guess” — the exact words used in the industry memo and in the E.P.A. policy change that followed shortly after Mr. Wehrum arrived — air pollution projections by power plants and refineries. The move provoked intense protests among Mr. Wehrum’s colleagues at the E.P.A. as it potentially undermines pending enforcement cases, including one prominent caseinvolving DTE Energy of Michigan, a longtime client of Mr. Wehrum’s former law firm, Hunton Andrews Kurth.

A second priority on Mr. Wehrum’s industry presentation called for a revision of the E.P.A.’s “project aggregation” policy, which could allow companies to perhaps avoid expensive upgrades to pollution control equipment by not forcing them to consider hazardous air emissions from other nearby factories they own. Such a revision is now underway, Mr. Wehrum announced in April.

A third priority was taken care of by the E.P.A.’s March announcement revising the “project netting” system the agency uses to evaluate anticipated increases in air pollution that might result from renovations and expansions of factories and power plants. Mr. Wehrum, as an E.P.A. official, called the revision “a common-sense interpretation” of the rules. He did not mention that this was the same change he had advocated as a petrochemical industry lawyer in the memo sent late last year.

While pushing the various rollbacks, Mr. Wehrum has at times continued to interact with former clients, despite an ethics rule that prohibits former industry lawyers and lobbyists from meeting with former clients in private settings to discuss government-related matters for two years.

For example, less than a month after he joined the E.P.A., Mr. Wehrum was back at the Pennsylvania Avenue offices of his old law firm to give a presentation to his former client, the Utility Air Regulatory Group, whose membership list features the nation’s largest coal-burning electric utilities, like American Electric Power and the Southern Company.

The topic was an overview of efforts at the E.P.A. to roll back some of the rules Mr. Wehrum and his former law firm had helped this group fight, including the Clean Power Plan, the email records show.

“Exceeds the E.P.A.’s statutory authority and would be repealed,” Mr. Wehrum said of the Clean Power Plan, according to a summary of the presentation, which was among records obtained through a Freedom of Information request.

John Konkus, an E.P.A. spokesman, said Mr. Wehrum’s presence at this event was allowed, despite the ethics ban, because “while it included some former clients,” others who attended “were not former clients.”

In the interview, Mr. Wehrum acknowledged that the line between right and wrong was not always clear. For example, he said he had repeatedly sought a definition of what represents a “particular matter involving specific parties,” which he would be banned from participating in as a result of the ethics pledge.

Citing this lack of clarity, Mr. Wehrum since he was confirmed last year has taken the unusual step for a Senate-confirmed political appointee of declining to sign a “recusal letter” that details individual clients and matters he has to stay away from — making it harder to identify when he faces a potential conflict.

“I have gotten three different interpretations, and what I don’t want to do is sign a recusal letter and then have the rules change again,” he said.

Mr. Wehrum, an intense and cerebral lawyer as well as a rail-thin marathon runner — he has run the Boston Marathon in a time of 3 hours 28 minutes — knows E.P.A. air pollution rules well. Raised in Memphis, he moved to Delaware in the late 1980s soon after graduating from college and took a job as an engineer at a chemical plant, eventually attending night school to get a law degree.

It was while working at the chemical plant — including studying a hydrogen peroxide fire at the plant — that he learned about the burden of responding to the E.P.A.’s complicated regulatory demands.

“I was the guy who had to figure out if we needed permits, and would go get permits for the plant,” Mr. Wehrum said. “That sort of drives a lot of how I think about this.”

He later moved to Washington and began helping to defend electric utilities and other manufacturers facing E.P.A. regulatory actions. In 2001, when a law partner was named by President George W. Bush to take over the same E.P.A. air-pollution policy office, Mr. Wehrum went with him: He served as a senior lawyer and later acting head of air pollution policy before returning to private practice toward the end of the Bush administration.

Several changes Mr. Wehrum has helped engineer since returning to the E.P.A. relate to a program known as New Source Review, a provision that since 2000 has forced more $7 billion worth of upgrades at 112 refineries in the United States — and another $116 million in civil penalties, according to petrochemical industry tally. New Source Review has also helped force tens of billions of dollars in air-pollution upgrades over the last two decades at more than 100 coal-burning power plants in the United States, which is why environmentalists credit the program for major reductions in smog nationwide.

But Mr. Wehrum — like his former clients — considers the program “unnecessarily complicated and confusing,” as Mr. Wehrum testified to the House in May.

Asked if it was wrong for Mr. Wehrum to be pushing an agenda that would clearly benefit his former clients — chipping away at the so-called N.S.R. rule — an E.P.A. spokesman, said in a statement, “N.S.R. reform is part of the Trump administration’s regulatory certainty agenda and predates Mr. Wehrum’s service in the Trump E.P.A.”

One change was so helpful to the petrochemical industry — making it less likely that its members will be ordered to make major upgrades to manufacturing plants during renovations — that several of the industries top executives were invited to the E.P.A. headquarters in March to celebrate.

Those present included executives from Marathon and Valero, two oil and gas and refinery companies that were key members of the petrochemical trade association Mr. Wehrum used to represent. Mr. Wehrum had helped write the new policy. But he has decided, at times, to skip ceremonies like this, in a nod to the ethics rules.

“You can write the memo,” joked Mr. Wehrum’s chief counsel, David Harlow, who is another former Hunton lawyer, according to people present at the staff meeting where the matter was discussed. “But you can’t go to the signing ceremony.”

Environmentalists and former E.P.A. officials say they remain concerned that many of the changes Mr. Wehrum is helping to deliver will hurt the public, including the repeal in January of a 23-year-old E.P.A. policy known as “once in, always in.” That policy stipulates that once a major polluting entity, such as a factory or power plant, emits enough pollution to subject it to regulations under the Clean Air Act, it must forever remain subject to those rules — even if a company can show that it has lowered its pollution rates.

“This reckless decision allows factories to switch off their pollution control systems to save a few dollars, even if that means dumping more toxic air pollution on their neighbors and putting their health at risk,” said Eric Schaeffer who spent 12 years at the E.P.A., including a stint as the head of enforcement until he left early in the Bush administration.

Mr. Wehrum considers the predictions scare mongering. He said the policy adjustments that he and others at the E.P.A. were making could help improve the environment, as companies would be less hesitant to make upgrades to air-pollution equipment.

Like the marathon runner he is, Mr. Wehrum shows no sign of slowing down.

“More than anything, I just want to get stuff done,” he said.

Coral Davenport contributed reporting. Kitty Bennett contributed research.