On May 23, 2017, the White House unveiled the full version of President Trump’s proposed budget for fiscal year (FY) 2018 entitled “A New Foundation for American Greatness.”  As signaled in the President’s “skinny budget” released earlier this year, the proposed budget would fund the U.S. Environmental Protection Agency (EPA) at $5.7 billion -- a more than 30 percent decrease from the current funding of nearly eight billion.  EPA’s congressionally enacted budget has remained relatively flat since 2000, other than a significant boost in 2010 to $10.3 billion.  The proposed FY18 budget also calls for an EPA staffing level of 11,611 -- a thirty year low.  The proposed decreased staffing level equates to a 20 percent reduction in the overall EPA workforce, which would eliminate approximately 3,000 employees.  A portion of the staff cuts would come from programs proposed for elimination, including the Center for Corporate Climate leadership, the Coalbed Methane Outreach group, and greenhouse gas reporting programs.  Some of the staff cuts may be accomplished by early retirement and lump sum voluntary separation payment incentives.  On June 1, 2017, EPA Acting Deputy Administrator Mike Flynn sent an e-mail to EPA employees providing preliminary details and next steps on early retirement and separation incentive offers.  Employees who accept offers will leave EPA by early September 2017.

Funding for state and tribal assistance grants (STAG) and other funds for state and regional initiatives is markedly decreased or zeroed out in the proposed budget, with cuts totaling $482 million, or 45 percent below the current enacted levels.  According to the Environmental Council of the States, which represents state departments of environment, STAG monies support approximately 27 percent of state departments of environment annual budgets.

In the area of federal enforcement, the Office of Enforcement and Compliance Assurance’s (OECA) budget would decrease by nearly 25 percent below current funding.  This decrease would reduce civil and criminal enforcement by 18 and 16.5 percent, respectively.  Funding for laboratory and forensics costs that support enforcement cases, including monitoring, would decrease by over 40 percent.  The corresponding reduction in enforcement efforts is likely to result in increased litigation from environmental advocates, particularly for matters governed by the Clean Air Act and the Clean Water Act which authorize citizen suits.

The budget requests $65 million for chemical risk review and reduction efforts under the Toxic Substances Control Act (TSCA), an increase of nearly $3.8 million from the current level.  EPA’s budget document notes that TSCA fee collections, set to begin in the second quarter of FY18, will fund approximately 53 full-time employees to support the chemical review process that were previously funded by federal appropriations. This small boost in funding may not be sufficient enough to support the implementation of “new TSCA,” however, and the implementation could still result in delays.

The President’s budget provides $99.4 million in appropriated funding to support EPA’s pesticide registration review and registration program, including implementation.  This amount would decrease funding by $20.4 million from current enacted levels.  In addition to budget appropriations, EPA’s pesticide program is supported by Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) maintenance fees and Pesticide Registration Improvement Act (PRIA) registration application fees.  These fees combined typically generate approximately $40-45 million in additional funding per year. Congress is currently considering the reauthorization of PRIA, which would increase application fees.  Together, however, the total amount of funds available to operate the pesticide program (appropriations and industry fees) have declined over the past years and present a threat to the pesticide program’s ability to meet application review deadlines.

EPA Administrator Pruitt’s Back-to-Basics agenda includes addressing hazardous waste clean-up of the sites that have remained on the Superfund National Priorities List for decades.  In spite of this priority action item, the proposed budget would fund the Hazardous Substance Superfund Account at $762 million, $330 million below the 2017 level.  Instead of relying on the Superfund account to finance remediation, EPA instead would use existing settlement funds to clean up hazardous waste sites.

EPA’s Office of Water’s overall funding would decrease by nearly 20 percent. The Clean Water and Drinking Water State Revolving Funds (SRF) funding levels would remain funded at current levels. The SRFs support states’ administration of their drinking water and surface water programs and related infrastructure projects.  Steep cuts to STAG grants, and zeroing out of the Section 319 Nonpoint Source program and regional initiatives like the Great Lakes and Chesapeake Bay programs will be felt at the state level. The Section 319 program targets nonpoint source pollution, including runoff from agricultural working lands. States use 319 program funds to support watershed improvement projects and incentivize voluntary installation of best management practices on farms (e.g., grass waterways and buffers).

EPA’s FY18 Budget in Brief provides more details on proposed budget allocations and priorities.  The President’s budget is likely to face steep opposition in Congress, which has until September 30, 2017, to pass a budget for FY18, although this timeline will likely be extended through the use of continuing resolutions.  The House is slated to finish its work on appropriation bills before the July 4, 2017, holiday break, which should provide more insights on how much influence the President’s budget will have with appropriations leadership.