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The Implications of a Biden Presidency
New U.S. administration likely to present policy challenges and opportunities.
Now that the results of the 2020 United States elections are final, it is important to look at the potential policy implications of a Biden presidency.
As with all presidential administrations, there will be some policy changes that can be accomplished simply through executive action. Both the Obama and Trump administrations were very active in issuing presidential executive orders to advance policy objectives. It is expected that a Biden administration would follow this trend and issue a series of executive orders very quickly after being sworn into office. Many of the first actions will reverse Trump executive actions and reset to Obama-era policies. Other policy changes will require congressional action. Democrats maintain a slim majority in the House of Representatives. After the Georgia Senate runoff elections, both won by Democrats, the Senate will be evenly split (50/50) between the two parties.
However, Democrats will gain control of the body by virtue of Vice President Harris casting the tie-breaking vote. With Democrats now controlling the House, Senate and White House, it will be much easier to advance Biden’s agenda. OSHA COVID-19 Temporary Emergency Standard One immediate policy area that will impact all businesses, not just industrial refrigeration, will likely be workplace health and safety related to COVID-19. Under the Trump administration, the Occupational Health and Safety Administration (OSHA) has taken the approach of providing guidance to industry on steps to control transmission of COVID-19 in the workplace. This has been criticized by labor advocates and has resulted in several states issuing their own temporary emergency standards that require businesses to take specific actions on COVID-19.
It appears very likely that under the Biden administration OSHA will move quickly to enact a national temporary emergency standard, moving away from guidance to enforceable requirements. While the details of such a temporary standard are not certain, OSHA could make following Centers for Disease Control (CDC) and OSHA guidance a regulatory requirement as well as implementing various training and documentation requirements. This would be similar to the approach taken by states, including Virginia, that have established their own emergency COVID standards. Such a policy could be implemented quickly, without congressional action, and set the stage for a longer rulemaking process to create a permanent regulation on infectious disease control in the workplace.
Climate Change and HFCs
On the campaign trail, Biden made addressing climate change a priority. He has pledged the United States will reach net-zero greenhouse gas emissions by 2050. One of the first expected actions is bringing the United States back into the Paris Climate Agreement, which has the goal of limiting global warming. Biden has proposed investing $1.7 trillion in clean energy and green jobs, ending fossil fuel subsidies and banning new oil and gas permits on public lands. Some analysts have estimated that Biden’s plan would reduce greenhouse gas emissions by about 75 gigatons of carbon dioxide by 2050, decreasing global warming by 0.1 degrees Celsius by the end of the century. In addition to rejoining the Paris Agreement, it is very likely that a Biden administration will push for ratification of the Kigali Agreement. The Obama administration supported the Kigali Agreement, which incorporates the reduction of HFCs as a part of the Montreal Protocol. Under the Obama administration, the Environmental Protection Agency (EPA) began taking steps to curb HFC usage, but those efforts were halted when courts ruled that the EPA does not currently have authority to regulate HFCs under the Clean Air Act. Ratification of the Kigali Agreement would give the EPA the authority needed to resume policies aimed at reducing HFCs (hydrofluorocarbons), which would impact the use of many freon-based refrigerants that have higher global warming potentials. Such a move would present opportunities for further promotion of natural refrigerants such as ammonia and CO2.
Kigali is one of the few climate policies that has bipartisan support and also enjoys some support from industry. In fact, bipartisan legislation has been introduced during the last two Congresses that would give EPA the authority to regulate and reduce the use of HFCs. Even with control of Congress so closely divided, Kigali could be one of the less controversial climate policies that could find enough support from both parties to get approved.
Revisiting RMP and PSM Regulations
In late 2019, the Trump administration successfully completed a rulemaking to reconsider changes to the EPA’s Risk Management Program (RMP) made at the end of the Obama administration. Trump’s regulatory action has been challenged in court and could also be revisited by a new Biden administration. The Biden administration could embrace the lawsuits that have been filed challenging the RMP Reconsideration Rule. Biden could also embark on yet another rulemaking on RMP to return to pre-Trump policies and potentially consider additional revisions to RMP. In addition to potential actions on RMP, a Biden administration may also consider changes to Process Safety Management (PSM). At the end of the Obama Administration, OSHA had started a rulemaking process to make changes to PSM, similar to what had been done to revise RMP. The Trump Administration effectively put those plans on the shelf, but a PSM rulemaking is still technically on the agency’s long-term regulatory agenda. It is likely that OSHA, under the Biden administration, will look to dust off the old Obama-initiated rulemaking effort to consider changes to PSM.
Labor policy is another area where a Biden administration is expected to be very active. The Biden campaign stated its commitment to strengthening worker organizing, collective bargaining and unions. The Trump administration reversed several Obama-era labor initiatives that are likely to be reinstated under a Biden administration. Issues like recognizing “micro-unit” organizing, allowing the use of work e-mails for union organization efforts and expanding the joint-employer standard are all initiatives that can be advanced without congressional action. Other Biden labor priorities, such as the Protecting the Right to Organize Act (PRO Act), will require congressional approval.
Biden has been very critical of the Tax Cuts and Jobs Act, also known as the “Trump tax cuts,” and has committed to reversing them. He also stated he will not raise taxes on anyone making less than $400,000 per year. With the margin of control in the House and Senate being so narrow, sweeping tax changes may be hard to accomplish. However, the two tax increases that have been identified as being the most likely to succeed are increasing in the corporate tax rate from 21% to 28%, and raising the top marginal incometax rate for those earning $400,000 or more from 37% to 39.6%. It is also expected Biden will work to reduce the Trump tax breaks for pass-through entities and the estate tax. It is worth noting that most of the individual and estate tax provisions in the Trump tax cuts are set to expire in 2025, while most of the business-related provisions are “permanent.”
As the industry moves forward in 2021, there will be policy challenges and opportunities presented by a Biden administration. Moves to curtail future HFC use could present opportunities to advance natural refrigerants. At the same time, regulations related to ammonia are likely to be revisited and potential become more burdensome. And, as the world tries to move past the COVID-19 pandemic, businesses will likely be subject to additional rules for protecting workplaces from the risks of COVID-19 transmission. The GCCA will continue to work closely with policy makers and industry partners, to promote and protect the interests of the cold chain.
LOWELL RANDEL is Senior Vice President, Government and Legal Affairs at GCCA.
Source: Cold Facts Jan/Feb 2021 issue