June 29, 2017

Reaction: EPA Proposes Rule To Repeal ‘WOTUS’

The National Pork Producers Council hailed today’s announcement by the U.S. Environmental Protection Agency that it will propose a rule to rescind a controversial Clean Water Act regulation that gave the government broad jurisdiction over land and water.

The proposal – expected to be published in the Federal Register in the coming days – will repeal the Waters of the United States (WOTUS) rule, which ostensibly was implemented to clarify EPA’s authority over various waters.

Based on several U.S. Supreme Court decisions, EPA’s jurisdiction had included “navigable” waters and waters with a significant hydrologic connection to navigable waters. But the WOTUS rule broadened that to include, among other water bodies, upstream waters and intermittent and ephemeral streams such as the kind farmers use for drainage and irrigation. It also covered lands adjacent to such waters.

“This is great news for America’s pork producers,” said NPPC President Ken Maschhoff, a pork producer from Carlyle, Ill. “The WOTUS rule was a dramatic government overreach and an unprecedented expansion of federal authority over private lands.

“It was the product of a flawed regulatory process that lacked transparency and likely would have been used by trial lawyers and environmental activists to attack farmers,” Maschhoff added. “We’re extremely grateful to President Trump and EPA Administrator [Scott] Pruitt for recognizing the dire consequences this ill-advised Obama-era regulation would have had on pork producers and all of American agriculture.”

Gov. Doug Burgum released the following statement today in response to the U.S. Environmental Protection Agency, Department of the Army and U.S. Army Corps of Engineers proposing a rule to rescind the “Waters of the U.S.” (WOTUS) rule.

 “Clean water is critical to quality of life and our economy, and no one cares more about clean water in North Dakota than the people who live here. Today’s action is a welcome step toward a rule recognizing that states are best positioned to protect, manage and regulate their own waters,” Burgum said. “The Obama administration’s WOTUS rule was a particularly egregious example of regulatory overreach that effectively classified almost every pond, pothole and slough as a federal managed waterway, creating confusion and uncertainty for farmers, ranchers, landowners and local governments. We are encouraged that the EPA and Corps of Engineers have been reaching out to governors early in this renewed rulemaking process, and we hope such consultation will continue and culminate in a rule that respects states’ authority and unique role in protecting their water resources. We are grateful to EPA Administrator Scott Pruitt for his leadership on this issue.”

 In July 2015, North Dakota spearheaded a lawsuit filed with a dozen other states against the EPA and Corps of Engineers over the WOTUS rule. The rule was blocked when the U.S. Court of Appeals for the Sixth Circuit granted a nationwide stay in October 2015. President Donald Trump signed an executive order Feb. 28 to begin the process of rescinding or revising the WOTUS rule.

The following is a statement from Texas farmer Wesley Spurlock, president of the National Corn Growers Association, in response to today’s announcement of the proposal to repeal the 2015 Waters of the U.S. (WOTUS) Rule:

“The goal of the Clean Water Act is to restore and maintain the integrity of the nation’s waters. The 2015 rule moved us further away from that goal. Repealing it is an important first step toward providing farmers the certainty and clarity we have long desired.

“We are thankful this Administration is working to draw clear lines in terms of what is and what is not jurisdictional under the Clean Water Act. In doing so, they will enable farmers to implement best management practices such as grass waterways and buffer strips without the burden of bureaucratic red tape or fear of legal action. These types of land improvements have enormous water quality benefits, such as reducing sediment and nutrient runoff—a win for farmers and the environment. Government should be making these actions easier, not more difficult.

“We salute the EPA and Army Corps of Engineers for their efforts. We stand committed to working with these agencies as they develop a new rule that defines jurisdictional boundaries in clear terms that are inclusive of the realities of farming.”

Once the proposed repeal rule is published, it will be subject to a public comment period.

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North Dakota’s Skunes Testifies on NAFTA at USTR Hearing

The North American Free Trade Agreement is critical for corn farmers and agriculture at large, and continuing its long-term success is a top priority to our members, National Corn Growers Association First Vice President Kevin Skunes testified Tuesday at a hearing of the Office of the U.S. Trade Representative to examine priorities for the upcoming NAFTA renegotiations.

“North America has become the most important export market for the U.S. corn industry,” Skunes testified. “Corn farmers export about 20 percent of our annual corn crop, and exports account for about one-third of our income. Today, the agriculture economy is experiencing its fourth year of a downturn marked by low commodity prices. I cannot stress enough how important export markets are to our ability to stay in business.”

Skunes, a farmer from Arthur, North Dakota, highlighted how NAFTA has positively impacted U.S. agricultural trade with Canada and Mexico since its implementation in 1994.

“Free trade has benefitted American farmers, and NAFTA has been extremely valuable to our industry,” said Skunes. “Twenty-three years of investment has led to a sizeable increase in trade. Since 1994, U.S. corn exports to NAFTA partners have increased more than seven-fold. Today, we export a record volume of more than 14 million metric tons of corn to Mexico and Canada, valued at $2.68 billion. In 2016, corn exports to these two neighbors supported 25,000 jobs, on top of helping support 300,000 U.S. corn farmers.”

Mexico is the largest export market for U.S. corn as well as a significant market for distillers dried grains with solubles (DDGS). Canada is a top-10 export market for corn and DDGS, and the number one export market for U.S. ethanol.

NCGA’s top priority for NAFTA modernization is to preserve duty-free access for corn and corn products, and to expand market access for corn in all forms, including livestock products, DDGS, and ethanol, Skunes told government officials.

“We look forward to working with USTR and the Administration to build on the success corn farmers and the broader agriculture industry have enjoyed under NAFTA.”

Click here for Skunes’ full prepared testimony.

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House Agriculture Committee Examines Future Risk of Clearinghouses in Financial Crises

The House Agriculture Committee held a hearing examining the regulation of derivative clearinghouses and how cleared markets may respond to a future financial crisis. Chairman K. Michael Conaway (TX-11) made the following remarks after the hearing:

“Clearinghouses are essential to financial markets. As the committee continues its oversight of these institutions, it is essential to understand their role in the well-being of our financial markets, and the new risks a financial crisis could pose. We must ensure clearinghouses work efficiently and effectively for market participants, while reducing systemic risks to our financial markets.”

Written testimony provided by the witnesses from today’s hearing is linked below. Click here for more information, including Chairman Conaway’s opening statement  and the archived webcast.

Witness List:
Panel I
Mr. Robert Steigerwald, Senior Policy Advisor, Financial Markets Group, Federal Reserve Bank of Chicago, Chicago, IL

Mr. Scott A. Hill, Chief Financial Officer, Intercontinental Exchange, Atlanta, GA

Mr. Jerrold E. Salzman, Of Counsel, Skadden, Arps, Slate, Meagher & Flom, Chicago, IL, on behalf of CME Group

Mr. John Dabbs, Global Head of Prime Derivatives, Credit Suisse, Washington,  DC

Mr. Amias Moore Gerety, Special Advisor at QED Investors, Former Assistant Secretary for Financial Institutions – U.S. Treasury Department, Washington DC

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