Federal Court Vacates FHWA Greenhouse Gas Mandate

What happened:  A federal court in Texas March 27 struck down a new rule from the Federal Highway Administration (FHWA) requiring states to factor greenhouse gas (GHG) emissions into their planning for highway projects. In siding with the state of Texas, which challenged the rule, the court agreed with and cited a brief jointly filed by ARTBA and the Associated General Contractors (AGC) of America, which argued FHWA lacked the statutory authority to impose this mandate. At the moment, FHWA may not implement the GHG rule, although its status is also subject to an imminent ruling from a Kentucky federal court, where 21 additional states filed a similar challenge.

Why it matters:  The FHWA rule, published Dec. 7 and scheduled to take effect March 29, would mandate state departments of transportation to set statewide GHG reduction targets, report on their progress, and coordinate with metropolitan planning organizations. Noncompliant states would have to submit supplementary reports until FHWA was satisfied. States would have to incur additional costs for this process and possibly change project priorities.

In joint amicus briefs submitted to both federal courts, ARTBA and AGC argued Congress had never authorized this provision, and had in fact purposefully omitted it during bipartisan negotiations leading to the Infrastructure Investment & Jobs Act in 2021. The Texas court agreed, saying only “the people, through Congress” could change federal law. “An agency can only do what the people authorize it to do,” the opinion noted. ARTBA has also pointed out that states may adopt their own GHG-related policies if they wish.

What’s next:  The court in Kentucky will clarify the rule’s status with its own ruling, expected any day. If it agrees with the Texas court, then the rule will be effectively dead unless the federal government can revive it on appeal in either case. Should the Kentucky court diverge from the Texas ruling, then the mandate would likely take effect in only certain states. ARTBA will report on the pending developments as they occur. For further information, please reach out to Prianka Sharma.