Category: Administrative & Regulatory

Senate Bill Would Amend FIFRA to Prohibit Dangerous Pesticides and Cancel Registrations of Organophosphates, Neonicotinoids, and Paraquat

On November 23, 2021, Senator Cory Booker (D-NJ) announced his intention to reintroduce the Protect America’s Children from Toxic Pesticides Act of 2021, that would amend the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) “to [protect fully] the safety of children and the environment, to remove dangerous pesticides from use, and for other purposes.” Similar legislation was introduced in the House (H.R. 7940) and Senate (S. 4406) in 2020, but the bills did not move out of committee.

Ending Indefinite Delays on Review of Dangerous Pesticides

The bill would amend FIFRA Section 2 to add a provision regarding registration review determination, defined as “the final decision to renew the registration of a pesticide product or active ingredient to authorize the use of the pesticide product or active ingredient” for an additional 15-year period from the date of the previous registration, reregistration, or registration review determination and in compliance with all applicable laws and regulations. Registration review determinations would not include any intermediate determination regarding the continued use of pesticide product or active ingredient.

The bill would allow an interested person to petition the U.S. Environmental Protection Agency (EPA) to designate an active ingredient or pesticide product as a dangerous pesticide, which would be defined as an active ingredient or pesticide product that may:

  • Be carcinogenic;
  • Be acutely toxic;
  • Be an endocrine disruptor;
  • Cause harm to a pregnant woman or a fetus; or
  • Cause neurological or developmental harm.

EPA would have 90 days after receiving the petition to make a finding as to whether the petition presents substantial scientific information indicating that the designation of the petitioned active ingredient or pesticide product as a dangerous pesticide may be warranted. If EPA fails to make a finding, the active ingredient or pesticide product would be deemed to be a dangerous pesticide. In making its finding, EPA “shall fully consider all relevant evidence,” including epidemiological studies or data; peer-reviewed literature; and data generated by a federal or state agency or an agency of a foreign government.

If EPA issues a finding that an active ingredient or pesticide product may warrant designation as a dangerous pesticide, the registration would be suspended immediately and remain suspended until EPA makes a registration review determination. The continued sale and use of existing stocks of a suspended active ingredient or pesticide product would be prohibited. If EPA fails to suspend the registration of an active ingredient or pesticide product that may warrant designation as a dangerous pesticide by no later than 60 days after any deadline described in this subsection, the registration of the active ingredient or pesticide product would be “immediately and permanently canceled” and the sale of existing stocks would be prohibited.

Emergency Review of Other Pesticides Banned in Other Nations

The bill would amend FIFRA Section 6 to require EPA to suspend immediately the registration of any active ingredient or pesticide product that is banned or otherwise prohibited from entering the market by the European Union (EU), one or more EU member states, or Canada. EPA would then complete an expedited review of the justification and rationale for the ban. Unless EPA determines that the decision was “clearly erroneous,” the suspended registration would be canceled not later than two years after the date of completion of the review. EPA “shall fully consider all relevant evidence,” including epidemiological studies or data; peer-reviewed literature; and data generated by a federal or state agency or an agency of a foreign government. In determining whether the ban was “clearly erroneous,” EPA would be prohibited from considering “any economic analysis of the benefits or costs of continuing to register the pesticide.” Before making a final determination, EPA would provide the draft determination for a comment period of not less than 90 days.

Ensuring Accountability in Conditional Registrations

The bill would amend FIFRA Section 3(c)(7) to provide registrants only two years to meet the terms and requirements of conditional registration. If a registrant fails to comply with the conditions by the earlier of the deadlines established by EPA or two years after the effective date of the conditional registration, EPA would cancel the conditional registration. Conditional registrations outstanding at the time the bill is enacted for which the registrant has not met the conditions would be canceled. The continued sale and use of existing stocks of a pesticide for which the conditional registration has been canceled would be prohibited.

Prohibition on the Sale or Use of Existing Stocks of Suspended or Canceled Pesticides

The bill would amend FIFRA Section 6(a) to prohibit the sale or use of existing stocks of a pesticide for which the registration is suspended or canceled, or vacated or set aside by judicial decree.

Amending Emergency Exemption Provisions

The bill would amend FIFRA Section 18 to limit emergency exemptions for the same active ingredient or pesticide product in the same location to two years in any ten-year period. EPA would no longer grant emergency exemptions to use an active ingredient or pesticide product that is not registered for any use or that is registered conditionally.

Adding Transparency for Inert Ingredients

The bill would amend FIFRA Section 2(n) to require that the ingredient statement include:

  • The name and percentage of each active ingredient in the pesticide product;
  • The name and percentage of each inert ingredient in the pesticide product;
  • If applicable, a statement that the pesticide product contains an inert ingredient determined by a state or federal agency, or the Administrator based on epidemiological data or peer-reviewed literature, to be likely:
    • To be carcinogenic;
    • To be an endocrine disruptor;
    • To be acutely toxic;
    • To cause harm to pregnant women or fetuses; or
    • To cause neurological or developmental harm.

The bill would amend FIFRA Section 3(c)(9) so that any required label or labeling must provide a complete list of inert ingredients.

Cancellation of Registration of Organophosphates

On the date of enactment, the bill would deem all organophosphate pesticides “to generally cause unreasonable adverse effects to humans,” and the registration of all uses of organophosphate pesticides would be “immediately and permanently canceled by operation of law and without further proceedings.” Tolerances and exemptions that allow the presence of an organophosphate or any pesticide chemical residue that results from organophosphate use in or on food would be revoked within six months of the date of enactment. The continued sale or use of existing stocks of organophosphate pesticides would be prohibited on the date of enactment. The bill would not allow any future organophosphate registrations and organophosphate pesticides would be ineligible for emergency use.

Cancellation of Registration of Neonicotinoids

On the date of enactment, the bill would deem all active ingredients and pesticide products containing one or more of the active ingredients imidacloprid, clothianidin, thiamethoxam, dinotefuran, acetamiprid, sulfoxaflor, and flupyradifurone (neonicotinoid pesticides) “to generally cause unreasonable adverse effects to the environment,” and the registration of all uses of neonicotinoid pesticides would be “immediately and permanently canceled by operation of law and without further proceedings.” Tolerances and exemptions that allow the presence of a neonicotinoid pesticide or any pesticide chemical residue that results from neonicotinoid pesticide use in or on food would be revoked within six months of the date of enactment. The continued sale or use of existing stocks of neonicotinoid pesticides would be prohibited on the date of enactment. The bill would not allow any future neonicotinoid registrations and neonicotinoid pesticides would be ineligible for emergency use.

Cancellation of Registration of Paraquat

On the date of enactment, the bill would deem paraquat “to generally cause unreasonable adverse effects to humans,” and the registration of all uses of paraquat would be “immediately and permanently canceled by operation of law and without further proceedings.” Tolerances and exemptions that allow the presence of paraquat or any pesticide chemical residue that results from paraquat use in or on food would be revoked within six months of the date of enactment. The continued sale or use of existing stocks of paraquat would be prohibited on the date of enactment. The bill would not allow any future paraquat registrations and paraquat would be ineligible for emergency use.

Empowering Communities to Protect Themselves from Pesticides

The bill would amend FIFRA Section 24 to extend the authority of a state to regulate the sale or use of any federally registered pesticide or device to “any political subdivision of a State.”

Protecting Farmworkers from Dangerous Pesticides

The bill would amend FIFRA Section 3(c)(9) to require that labels be printed in both English and Spanish. If a pesticide product is known to be used in agriculture by more than 500 individual persons or applicators who speak the same language other than English or Spanish, EPA will provide a translation of the label in that language on its website. The bill would amend FIFRA to include a section concerning farmworker safety. Employers of farmworkers would be required to report to EPA farmworker incidents, defined as exposure of a farmworker to an active ingredient, a pesticide product, a tank mixture of multiple pesticides, a metabolite, or a degradate that results in:

  • An illness or injury:
    • Requiring medical attention or hospitalization of the farmworker; or
    • That requires the farmworker to stop working temporarily or permanently;
  • A permanent disability or loss in function of the farmworker; or
  • Death of the farmworker.

The bill would require EPA to implement an online system to facilitate the reporting of farmworker incidents within 60 days of the bill’s enactment. The online system must allow for anonymous reporting to protect farmworkers from retaliation. Employers that fail to report a farmworker incident would be fined $1,000 per day beginning on the eighth day after the farmworker incident occurs. Employers that knowingly fail to report or that pressure or coerce a farmworker not to report would be liable for a criminal penalty of up to $100,000, six months in prison, or both. The bill calls for EPA to implement a reward system that provides a monetary award of not less than $25,000 per person per farmworker incident that leads to the identification of one or more employers that have failed to report a farmworker incident.

Within 15 days of receiving a report of a farmworker incident, EPA would transmit a report of the incident to the manufacturer of each involved pesticide product and the manufacturer of each involved active ingredient or ingredients. If a farmworker incident results in the death of a farmworker, the pesticide product or active ingredient that caused the death would be immediately suspended, pending a review. Pesticide product manufacturers who receive a farmworker incident report would have 60 days to provide EPA an assessment of the incident, including whether any changes to the label of the pesticide product or active ingredient are warranted at the time of the assessment to avoid future farmworker incidents. Active ingredient manufacturers who receive a report of a farmworker incident would have 60 days to provide to EPA an assessment of the farmworker incident, including whether any changes to the pesticide product or active ingredient are warranted at the time of the assessment to avoid future farmworker incidents.

No later than the earlier of 90 days after receiving an assessment from a pesticide product or active ingredient manufacturer or 180 days after the occurrence of the farmworker incident, EPA will make a draft determination as to whether a change in the label of an involved pesticide product is warranted. EPA will publish its draft determination in the Federal Register for a 30-day comment period. No later than 30 days after the close of the public comment period, EPA will make a final determination as to whether the label should be changed and publish its decision in the Federal Register.

If EPA makes a final determination that the label of the applicable product must be changed and the manufacturer of the pesticide product or active ingredient fails to do so, the pesticide product or active ingredient “shall be immediately and permanently canceled by operation of law and without further proceedings.” If a pesticide product or active ingredient is responsible for ten or more farmworker incidents of any type, or three or more incidents resulting in death, and the pesticide product or active ingredient has not received a final determination regarding a registration review during the preceding 15-year period, EPA will “immediately suspend the pesticide product or active ingredient until a final determination is made regarding the registration review of the pesticide.”

Authority to Bring Civil Action

The bill would amend FIFRA Section 16 to allow any person to bring a civil action where there is an alleged failure of EPA to comply with any of its provisions. The U.S. District Courts would have exclusive jurisdiction over such actions.

Employee Protection

The bill would amend FIFRA to add a section regarding employee protection. Employers would be prohibited from discharging or discriminating against an employee because the employee has commenced or is about to commence a proceeding under the Act, has testified in a proceeding, or has assisted or participated in a proceeding. Employees would have 30 days from the date of the alleged violation to file a complaint with the Secretary of Labor and the Secretary would have 30 days to conduct an investigation.

Commentary

This bill is unlikely to become law any time soon. This legislation, or anything like it in terms of its presumption that pesticides approved by EPA under current law are fundamentally flawed, would present a radical change to current EPA authority and procedures. Advocates of such change believe otherwise, and point to the fact that FIFRA has not been amended for 25 years. Whether this is sufficient to garner broad support of national environmental and consumer advocacy groups is unclear. Assuming it gains the support of at least a handful of Democrats in the Senate, along with a likely House companion bill, this legislation lays the groundwork for advocating eventual changes to FIFRA. This approach takes a page from the Toxic Substances Control Act (TSCA) reform playbook. Certain Members of Congress and TSCA stakeholders established policy positions for reform five or more years before reauthorization occurred. Similar to TSCA, the legislation is premised on the view that FIFRA is fundamentally flawed, a widely held view with TSCA reform. This view is not widely shared with regard to FIFRA, however. Critics of this proposed legislation will argue that EPA has been effective at implementing FIFRA driven by the requirements of the 1996 Food Quality Protection Act amendments, following a rigorous scientific process with various required safety factors to determine that pesticides used on food meet a “reasonable certainty of no harm” standard. In that view, this bill may be a solution in search of a problem. If this legislation is indeed used as a starting point for reform, there will be many more years before any common ground is found — and common ground likely will be essential for any kind of meaningful FIFRA “modernization.”

©2021 Bergeson & Campbell, P.C.
Article by Bergeson & Campbell, P.C.‘s Government Regulation practice group.
For more articles about toxic substance legislation, visit the NLR Biotech, Food & Drug section.

US to Expand Vaccination Requirement for Foreign National Travelers to Include All Land Border Crossers from Canada and Mexico in January

Starting Jan. 22, 2022, the Biden administration will require foreign national travelers engaged in essential travel to be fully vaccinated when crossing U.S. land borders or ferry terminals. Essential travel includes travel for work or study in the United States, emergency response, and public health. The new rules apply to foreign nationals; U.S. citizens and permanent residents may still enter the United States regardless of their vaccination status but are subject to additional testing requirements.

The new rules for essential travelers are in line with those that took effect Nov. 8, 2021, when the Biden administration lifted travel restrictions to allow fully vaccinated travelers engaged in non-essential (leisure) travel to enter the United States.

While much cross-border traffic was shut down in the early days of the COVID-19 pandemic, essential travelers have been able to travel unimpeded via land borders or ferry terminals. Starting Jan. 22, 2022, however, all foreign national travelers crossing U.S. land borders or ferry terminals – traveling for essential and non-essential reasons – must be fully vaccinated for COVID-19 and provide related proof of vaccination. Any exceptions to the vaccination requirement available to travelers at U.S. land borders are expected to be limited, just as exceptions currently available for air travel have been limited. See CDC guidance for details.

©2021 Greenberg Traurig, LLP. All rights reserved.
For more on vaccine requirements, visit the NLR Coronavirus News section.

DOL Publishes Final Rule Implementing President Biden’s $15 Federal Contractor Minimum Wage Executive Order 14026

The Department of Labor (DOL) has published its Final Rule implementing President Biden’s April 27, 2021, Executive Order 14026 raising the minimum wage from $10.95 an hour to $15 an hour (with increases to be published annually). The new wage rate will take effect January 30, 2022, though as discussed below, the rate increases will not be applied to contracts automatically on that date.

The Final Rule is substantially similar to the DOL’s proposed Notice of Rulemaking issued in July 2021 and is more expansive in coverage than the current federal contractor minimum wage requirements in effect under former President Obama’s Executive Order 13658.

$15 Wage Rate Does Not Apply to All Federal Contractors, All Federal Contracts, or All Workers

Covered Contracts

The $15 wage rate will apply to workers on four specific types of federal contracts that are performed in the U.S. (including the District of Columbia, Puerto Rico, and certain U.S. territories):

  • Procurement contracts for construction covered by the Davis-Bacon Act (DBA), but not the Davis-Bacon Related Acts
  • Service Contract Act (SCA) covered contracts
  • Concessions contracts – meaning a contract under which the federal government grants a right to use federal property, including land or facilities, for furnishing services. The term “concessions contract” includes, but is not limited to, a contract the principal purpose of which is to furnish food, lodging, automobile fuel, souvenirs, newspaper stands, or recreational equipment, regardless of whether the services are of direct benefit to the government, its personnel, or the general public
  • Contracts related to federal property and the offering of services to the general public, federal employees, and their dependents

The Executive Order does not apply to contracts or other funding instruments, including:

  • Contracts for the manufacturing or furnishing of materials, supplies, articles, or equipment to the federal government
  • Grants
  • Contracts or agreements with Indian Tribes under the Indian Self-Determination and Education Assistance Act
  • Contracts excluded from coverage under the SCA or DBA and specifically excluded in the implementing regulations and
  • Other contracts specifically excluded (See NPRM Section 23.40)

Effective Date; Definition of “New” Contracts Expanded

The Final Rule specifies that the wage requirement will apply to new contracts and contract solicitations as of January 30, 2022. Despite the “new contract” limitation, the regulations, consistent with the language of the Biden Executive Order, strongly encourage federal agencies to require the $15 wage for all existing contracts and solicitations issued between the date of the Executive Order and the effective date of January 30, 2022.

Similarly, agencies are “strongly encouraged” to require the new wage where they have issued a solicitation before the effective date and entered into a new contract resulting from the solicitation within 60 days of such effective date.

Pursuant to the Final Rule, the new minimum wage will apply to new contracts; new contract-like instruments; new solicitations; extensions or renewals of existing contracts or contract-like instruments; and exercises of options on existing contracts or contract-like instruments on or after January 30, 2022.

Geographic Limitations Expanded

The Final Rule applies coverage to workers outside the 50 states and expands the definition of “United States” to include the 50 states, the District of Columbia, Puerto Rico, the Virgin Islands, Outer Continental Shelf lands as defined in the Outer Continental Shelf Lands Act, American Samoa, Guam, the Commonwealth of the Northern Mariana Islands, Wake Island, and Johnston Island.

Workers Performing Work “On or In Connection With” a Covered Contract

Only workers who are non-exempt under the Fair Labor Standards Act and performing work on or in connection with a covered contract must be paid $15 per hour. The wage requirement applies only to hours worked on or in connection with a covered contract.

A worker performs “on” a contract if the worker directly performs the specific services called for by the contract. A worker performs “in connection with” a contract if the worker’s work activities are necessary to the performance of a contract but are not the specific services called for by the contract.

The Final Rule includes a “less-than-20% exception” for those workers who only perform work “in connection with” a covered contract, but do not perform any direct work on the contract. For workers who spend less than 20% of their hours in a workweek working indirectly in connection with a covered contract, the contractor need not pay the $15 wage for any hours for that workweek.

Tipped Employees

Under the Final Rule, DOL is phasing out lower wages and tip credits for tipped employees on covered contracts. Employers must pay tipped employees $10.50 per hour in 2022 and increase those wages incrementally, under a proposed formula in the NPRM. Beginning in 2024, tipped employees must receive the full federal contractor wage rate.

$15 Wage Contract Clause Requirements, Enforcement Obligations

The Final Rule provides that a Minimum Wage contract clause will appear in covered prime contracts, except that procurement contracts subject to the Federal Acquisition Regulation (FAR) will include an applicable FAR Clause (to be issued by the Federal Acquisition Regulation Council) providing notice of the wage requirement.

In addition, covered prime contractors and subcontractors must include the Contract Clause in covered subcontracts and, as will be in the applicable FAR Clause, procurement prime contractors and subcontractors will be required to include the FAR clause in covered subcontracts.

In addition, the Final Rule provides that contractors and subcontractors:

“… shall require, as a condition of payment, that the subcontractor include the minimum wage contract clause in any lower-tier subcontracts … [and] shall be responsible for the compliance by any subcontractor or lower-tier subcontractor with the Executive Order minimum wage requirements, whether or not the contract clause was included in the subcontract.”

The DOL will investigate complaints and enforce the requirements but under the Final Rule, contracting agencies may also enforce the minimum wage requirements and take actions including contract termination, suspension and debarment for violations.

Preparation for the $15 wage

To prepare, contractors and subcontractors of covered contracts should consider taking the following steps:

  • Review existing multi-year contracts with options or extensions that may be exercised on or after January 30, 2022, to plan for wage increases at the exercise of the option or extension, but also review any contract modifications to see if an agency is including the requirement early than required, as is allowed under the Final Rule
  • Identify job titles that typically perform work directly on covered contracts and those that perform indirect work above 20% in a workweek
  • Plan for wage increases for covered workers who are not already making $15 per hour
  • Determine impact on existing collective bargaining agreements particularly on SCA-covered contracts
  • Prepare for submission of price/equitable adjustments based on wage increases if allowed under the contract terms

Article By Leslie A. Stout-Tabackman of Jackson Lewis P.C.

For more labor and employment legal news, read more at the National Law Review.

Jackson Lewis P.C. © 2021

USCIS Announces Policy Changes for H-4, L-2, and E-1/E-2/E-3 Dependent EAD Workers

Since the publication of our November 12, 2021 alert, U.S. Citizenship and Immigration Services (USCIS) issued policy guidance following the November 10, 2021 settlement agreement and updated the I-9 Handbook providing for automatic extensions of Employment Authorization Document (EAD) cards for H-4, L-2, and E-1 Dependent, E-2 Dependent, or E-3 Dependent visa holders. The USCIS policy guidance can be found here.

As described in our previous alert, the Department of Homeland Security (DHS) entered into a settlement agreement following a lawsuit brought by H-4 and L-2 spouses suffering from long-delayed adjudication for the processing of applications for Employment Authorization Document (EAD) cards. Effective November 12, 2021, USCIS allows for automatic extensions of employment authorization, in certain circumstances, while an EAD renewal application has been filed and is pending with USCIS for H-4, L-2, and now E-1/E-2/E-3 dependent (“E dependent”) spouses. In addition, USCIS has now changed its statutory interpretation and will soon afford employment authorization incident to status for L-2 spouses, E-1 Treaty Trader dependent spouses, E-2 Investor dependent spouses, and E-3 specialty occupation professionals from Australia dependent spouses. Once this policy takes effect, L-2 and E dependent spouses will no longer need to apply for an EAD card in order to be authorized to work.

Automatic Extension of EADs for H-4, L-2, and E Dependent Spouses

USCIS has officially issued guidance and updated the I-9 Handbook to provide for automatic extensions of EADs for H-4 and L-2 spouses. In this new policy alert, USCIS is granting these benefits to spouses of E-1 Treaty Traders, E-2 Treaty Investors, and E-3 specialty occupation professionals from Australia in the respective E dependent classification as well.

H-4, L-2, and E dependent spouses will qualify for automatic extension of their valid EAD for 180 days beyond the date of the EAD expiration if the nonimmigrant spouse:

  • Properly files a Form I-765 EAD renewal application to USCIS before the current EAD expires; and
  • Continues to maintain H-4, L-2, or E dependent status beyond the expiration of the existing EAD as evidenced on Form I-94.

The validity of the expired EAD will be extended until the earliest of:

  • 180 days following the EAD expiration;
  • The expiration of the H-4 / L-2 / E dependent nonimmigrant’s I-94 record; or
  • When a final decision is made on the EAD extension application by USCIS.

For I-9 purposes, an H-4, L-2, or E dependent employee may present: a facially expired EAD indicating Category C26, A18, or A17; Form I-797, Notice of Action for Form I-765 with Class requested indicating (c)(26), (a)(18), or (a)(17) and showing that the I-765 EAD renewal application was filed before the EAD expired; and an unexpired I-94, showing valid H-4, L-2, or E dependent nonimmigrant status.

L-2 and E-1/E-2/E-3 Dependent Spouses Will Be Granted Work Authorization Pursuant to Status

USCIS’ new policy guidance provides that both L-2 and E dependent spouses will be employment authorized incident to status, meaning that a separate Form I-765 EAD application will not need to be filed to obtain work authorization, and that the L-2 or E dependent spouse is authorized to work upon being admitted to the United States. USCIS, in cooperation with CBP, will change Form I-94 to indicate the individual is an L-2 spouse so that the I-94 can be used for I-9 purposes. DHS will, within 120 days, take steps to modify Form I-94. However, please note that until USCIS can implement changes to the I-94 to distinguish L-2 and E dependent spouses currently in the U.S. from L-2 and E dependent children, E and L spouses will still need to rely upon an EAD as evidence of employment authorization to present to employers for completion of Form I-9.

Obtaining an Extended I-94

As it is required for H-4, L-2, and E-3 spouses to have a valid I-94 for the automatic extension of the EAD, we are outlining two possible ways that a person applying for an H-4 or L-2 EAD extension can obtain an extended I-94:

  1. File the H-1B or L-1 extension using premium processing and wait for the H-1B or L-1 approval. The H-4 or L-2 spouse then departs the U.S. and obtains a new visa and returns with an extended I-94. Once the spouse returns, he or she will file the EAD extension upon return to the U.S.
  2. File the H-4 or L-2 and EAD extensions with the principal’s H-1B or L-1 extension. After the H-1B or L-1 is approved, the spouse departs the U.S. and obtains a new visa and returns with an extended I-94. The Form I-539, request for extension of status, will be abandoned, but Form I-765 will not and will continue to be processed by USCIS.

Regarding E dependent spouses, anyone entering the U.S. with an E visa is admitted for two years, so he or she may already have an extended I-94 card. If an E dependent spouse has an expiring I-94, he or she can follow one of the above steps to extend their I-94.

Article By Angel Feng, Shannon N. Parker, and John F. Quill of Mintz.

For more immigration law news, read more at the National Law Review.

©1994-2021 Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. All Rights Reserved.

The Virginia Consumer Data Protection Act, the Colorado Privacy Act, and the Draft Connecticut Privacy Legislation: An Overview and Practical Guide

Just when organizations start to feel comfortable with the California Consumer Privacy Act (CCPA), as amended by the California Privacy Rights Act (CPRA), this year we saw the passage of two new comprehensive privacy laws in Virginia and Colorado and nearly another in Connecticut. This article discusses the Virginia Consumer Data Protection Act (VCDPA) and the Colorado Privacy Act (CoPA) and identifies parallels and differences between these statutes and other privacy laws. The article also discusses the pending comprehensive privacy law in Connecticut – we anticipate its passage in the near future.

For those familiar with current privacy laws, both in the United States and globally, the VCDPA and the CoPA do not present entirely new concepts. They are variations on a theme, in that the provisions and concepts are mostly based on the Fair Information Practice Principles, as are many other privacy laws. Proponents of the VCDPA and the CoPA hail them as an adoption of the best parts of current privacy laws while opponents refer to them as an odd mish-mash of current regulations.

This article provides an overview of the VCDPA and the CoPA with an emphasis on the portions of the laws that we anticipate will receive the most inquiries from attorneys general enforcing the acts. The article provides a brief overview of the key dates and provisions, the similarities and shared concepts between the statutes and other laws, newly introduced concepts by the statutes, as well as expectations for enforcement.

It is assumed that those reading this article are familiar with the basic requirements of the CCPA and the European Union’s General Data Protection Regulation (GDPR).

Important Dates

Virginia enacted the Virginia Consumer Data Protection Act (VCDPA) on March 2, 2021, becoming the second state to enact comprehensive legislation regarding data privacy (behind only California). Following California and Virginia, Colorado became the third state to enact a comprehensive privacy law with the passage of the Colorado Privacy Act (CoPA) on July 8, 2021. A comprehensive privacy law overwhelmingly passed in the Senate in Connecticut but was stricken by the House shortly before the remaining parts of the bill were presented to the Governor for his signature.

VCDPA Effective Date

While the VCDPA was signed into law on March 2, 2021, the VCDPA is not effective until January 1, 2023, in order to provide organizations and stakeholders time to prepare for the changes.

CoPA Effective Date

Similarly, while the CoPA was signed into law on July 8, 2021, it does not become effective until July 1, 2023. The CoPA includes a number of other significant dates as well. The notice and cure period (discussed below) are automatically repealed on January 1, 2025. Additionally, the Colorado Attorney General (the “Colorado AG”) must adopt rules outlining technical specifications for opt-out mechanism by July 1, 2023, and the Colorado AG is also authorized to adopt rules by January 1, 2025, which would then become effective on or before July 1, 2025.  The VCDPA, by contrast, does not require any implementing regulations.

Definitions of Key Terms

The VCDPA and the CoPA define parties and information differently than the CCPA, and this article will briefly mention some of the key defined terms.

“Consumers”

The VCDPA and the CoPA were enacted to empower “consumers” to protect their personal information and to require companies to be responsible with personal information they obtain. “Consumers” is defined by the statutes to include an individual who is a Colorado/Virginia resident acting only in an individual or household context and does not include someone acting in a commercial or employment context.[1]

“Controller” vs. “Processor”

Borrowing a concept from the GDPR, the VCDPA and the CoPA regulate “controllers” and “processors.”[2] A “controller” is the person or entity that “determines the purpose and means of processing personal data”, whereas a “processor” is a person or entity that “processes personal data on behalf of a controller.”[3]

“Personal Data” vs. “De-Identified Data” vs. “Sensitive Data”

The VCDPA and the CoPA regulate the collection, storage and use of “personal data,” which is defined to include information that is linked or reasonably linkable to an identified or identifiable individual. As in other privacy laws, personal data does not include “de-identified data.”[4]

De-identified data is also similarly defined by both statutes to include data that cannot reasonably be used to infer information about, or otherwise be linked to, an identified or identifiable individual, or a device linked to such an individual, if the controller that possesses the data:

(a) takes reasonable measures to ensure that the data cannot be associated with an individual;

(b) publicly commits to maintain and use the data only in a de-identified fashion and not attempt to re-identify the data; and

(c) contractually obligates any recipients of the information to comply with these requirements.[5]

Borrowing a concept from the GDPR and the CPRA, the VCDPA and the CoPA also provide special protections for a subset of personal information defined as “sensitive data”, which includes personal data revealing racial or ethnic origin, religious beliefs, mental or physical health diagnosis, sexual orientation, or citizenship or immigration status; genetic or biometric data for the purpose of uniquely identifying a natural person; and personal data collected from a known child.[6]

Scope of Application: Who is Covered?

The VCDPA and the CoPA deviate from the CCPA in that an entity is covered by the statutes regardless of the amount of that entity’s revenues.[7]  

Under the VCDPA, an entity is covered if it conducts business in the Commonwealth or produces products or services that target residents of the Commonwealth, and:

  • during a calendar year, controls or processes personal data of at least 100,000 consumers; or
  • controls or processes personal data of at least 25,000 consumers and derives over 50% percent of gross revenue from the sale of personal data.[8]

Similarly, under the CoPA, a controller is covered if it conducts business in the state or produces or delivers commercial products or services that are intentionally targeted to residents in the state; and:

  • controls or processes the personal data of 100,000 consumers or more during a calendar year; or
  • derives revenue or receives a discount on the price of goods or services from the sale of personal data and processes or controls the personal data of 25,000 consumers or more.

In addition to exempting de-identified data and certain categories of information that are already subject to privacy regulations, the VCDPA provides blanket exemptions for certain types of organizations, including (1) government agencies and authorities, (2) financial institutions subject to GLBA, (3) “covered entities” regulated by HIPAA and HITECH, (4) nonprofit organizations, and (5) institutions of higher education.[9] The CoPA similarly exempts de-identified data and exempts certain categories of information, but it has fewer categories of institutions that are per se exempt from the statute.[10]

Shared Concepts and Provisions regarding Controllers[11]

In addition to having some similar definitions and the scope of their application, the VCDPA and the CoPA have many similar requirements and provisions. The statutes create a number of rights for consumers, place a number of obligations on controllers, require processes for consumers whose requests for information are denied, and impose similar data protection requirements.

Consumer’s Rights

The VCDPA and the CoPA provide consumers[12] with a number of rights concerning their personal data, including:

  1. The Right to Know whether “whether a controller is processing the consumer’s personal data;”
  2. The Right to Access such personal data;
  3. The Right to Correct Inaccuracies in the consumer’s personal data;
  4. The Right to Delete personal data provided by or obtained about the consumer;
  5. The Right to a Data Portability that allows a consumer to obtain a copy of the consumer’s personal data; and
  6. The Right to Opt Out of the processing of personal data for purposes of (i) targeted advertising, (ii) the sale of personal data, or (iii) profiling in furtherance of decisions that produce legal or similarly significant effects concerning the consumer.[13]

The CoPA’s Right to Opt Out of the processing of personal data slightly deviates from the VCDPA.[14] The CoPA requires that consumers be provided with a “universal opt-out mechanism” that is compliant with the technical specifications that must be promulgated by the Colorado AG.[15] The Colorado AG’s “technical specifications” must ensure that the mechanism is not used to unfairly disadvantage another controller, sufficiently informs consumers about the opt-out choices available to them, represents the consumer’s affirmative and unambiguous choice to opt out, is consumer friendly, is consistent with any similar mechanisms required by law or regulation elsewhere in the United States, and permits the controller to accurately authenticate the consumer.[16]

Data Collection, Security, and Management

While the VCDPA and the CoPA have differences, they also share a number of concepts and provisions with respect to imposing obligations on controllers. We discuss the key concepts and provisions below but recommend that you read the actual text of the statutes to understand nuances and distinctions of the laws.

The VCDPA and the CoPA have adopted the data minimization concept, which generally provides that controllers’ collection of personal data and must be limited to that data which is adequate, relevant, reasonably necessary for the specified purpose for which the data was collected.[17]

The VCDPA and the CoPA also require controllers to disclose the purpose for which the personal data is collected and processed, and a controller cannot process personal data for purposes other than those that are disclosed.[18] 

The VCDPA and the CoPA also require controllers to take reasonable actions to secure the personal data during both storage and use of the data to protect the confidentiality, integrity, and accessibility of the personal data.[19]

Finally, under the VCDPA and the CoPA, a controller is prohibited from processing “sensitive data” without first obtaining the consumer’s consent.[20] “Sensitive data” includes “(a) [p]ersonal data revealing racial or ethnic origin, religious beliefs, a mental or physical health condition or diagnosis, sex life or sexual orientation, or citizenship or citizenship status; (b) Genetic or biometric data that may be processed for the purpose of uniquely identifying an individual; or (c) Personal data from a known child.”[21]

Processes for Appeals

Not only do the statutes endow consumers with rights, they also require that controllers must be provided with an avenue to exercise those rights, and controllers are required to respond to consumer inquiries. Specifically, consumers may submit requests to controllers to specify the rights the consumer wishes to invoke, and the laws require that controllers must respond within 45 days of receiving the request with only one possible 45-day extension when “reasonably necessary” and when certain conditions are met.[22]

Further, the controller must establish an internal process wherein consumers may appeal a controller’s decision to refuse to take action on the consumer’s request to exercise any of its rights.[23] If the appellate process does not cause the controller to change its position, the controller is required to provide the consumer with the contact information for the attorney general in order to submit a complaint.[24] 

Data Protection Assessments

The VCDPA and the CoPA also require controllers to “conduct and document a data protection assessment” of certain processing of personal data for purposes of targeted advertising or profiling in certain circumstances, the sale of personal data, and the processing of sensitive data.[25]

The data protection assessments are to identify and weigh the benefits that may flow, directly and indirectly, from the data processing to the controller, the consumer, other stakeholders, and the public against the potential risks to the rights of the consumer associated with such processing. The assessment also must be disclosed to the attorney general when such data protection assessment is relevant to an investigation.[26]

Litigation and Enforcement

Timeline for Enforcement

The Virginia and Colorado AGs cannot commence enforcement activities under the VCDPA and the CoPA until January 1, 2023 and July 1, 2023, respectively. However, based on the approach taken by the California AG in enforcing the CCPA, organizations can expect investigations and enforcement activity to begin as soon as the statutes permit. Additionally, using what we know from the California AG’s first year of CCPA enforcement, expect that the Colorado AG and Virginia AG Offices will have very busy years.[27]

VCDPA – Enforcement and Fines

The VCDPA provides no private right of action. The Virginia AG has exclusive authority to enforce the VCDPA.[28] The Virginia AG is even given broad authority and can begin an investigation even before a violation occurs if it has reasonable cause to believe that a person is “about to engage in any violation” of the Act.[29]

The VCDPA provides a controller or processor with a 30-day period after receiving written notice from the Virginia AG of an alleged violation in order to cure that violation.[30] If the controller or processor does not cure such violation within the 30-day period, the Virginia AG may initiate a lawsuit to seek an injunction and to recover civil penalties of up to $7,500 for each violation and reasonable expenses, including attorneys’ fees.[31]

The VCDPA also creates a special fund called the Consumer Privacy Fund, and all civil penalties, expenses, and attorneys’ fees recovered under the VCDPA shall be credited to the Fund, which is then used to support the Virginia AG’s work to enforce the VCDPA.[32]

CoPA – Enforcement and Fines

Likewise, the CoPA does not create private right of action.[33] It instead will be enforced by the Colorado Attorney General and Colorado’s district attorneys.[34] 

The CoPA notes that the Colorado Attorney General must provide a controller or processor with a 60-day period to cure an alleged violation before bringing an enforcement action.[35]  However, effective January 1, 2025, the Colorado AG is no longer required to provide a cure period but can immediately bring an enforcement action.[36]

Violations of the CoPA are considered a deceptive trade practice, which allows for a civil penalty of $20,000 for each violation.[37] 

No Check-the-Box Compliance

The AGs will likely focus on a number of areas for enforcement but with a general theme. Specifically, using the California AG’s experience with enforcing the CCPA, we can expect that the Virginia and Colorado AGs will want to ensure that organizations are not treating the new laws as check-the-box exercises but, rather, are providing consumers with required information and timely engaging with consumer’s requests. Indeed, not only will the AGs want organizations to provide the necessary information, they will demand that it be conveyed in a way that can be easily understood by the average consumer and in which consumers will have the fewest number of steps to access the information and exercise their rights.

Scope of the CCPA and Compliance Strategies

 

Implementing Regulations

 

CCPA Notice and Cure Provision Relating to Data Breaches

 

CCPA Enforcement Series

 

GDPR Overview and Updates

 

Virginia Consumer Data Protection Act Series

  1.  See Va. Code Ann. § 59.1-575; Colo. Rev. Stat. § 6-1-1303(6)
  2. See Colo. Rev. Stat. § 6-1-1303(7) (slightly different definition of controller) see GDPR, Art. 4(7) (defining Controller); id. Art. 4(8) (defining Processor). The proposed bill in Connecticut likewise used this distinction. See CT Senate Bill 893 § 1(8), (20).
  3. Va. Code Ann. § 59-1-571.
  4. Colo. Rev. Stat. § 6-1-1303(17); Va. Code Ann. § 59.1-575.
  5. Colo. Rev. Stat. § 6-1-1303(11); Va. Code Ann. § 59.1-575; see id. § 59.1-581.
  6.  Colo. Rev. Stat. § 6-1-1303(24); Va. Code Ann. § 59.1-575 (the VCDPA’s definition also includes “precise geolocation data” as sensitive information).
  7. In order for an entity to be considered a business, and hence regulated by the CCPA, it must satisfy at least one of three thresholds. One such threshold is whether the business has gross annual revenue over $25 million. See Cal. Civil Code 1798.140(c)(1)(A) (Oct. 2020).
  8.  Connecticut proposed similar qualifications. See CT Senate Bill 893.
  9.  Connecticut has likewise proposed similar exemptions. CT Senate Bill 893 § 3.
  10.  Colo. Rev. Stat. § 6-1-1304(2).
  11.  For more information concerning the role of processors, please refer to Va. Code Ann. § 59.1-579 and Colo. Rev. Stat. § 6-1-1305.
  12. “Consumer” is a specifically defined term in the Acts. Va. Code Ann. § 59.1-575; CT SB893 § 1(7).
  13. Va. Code Ann. § 59.1-577.A; Colo. Rev. Stat. § 6-1-1306. Connecticut SB 893 contained similar requirements.  See CT SB 893 § 4(a).
  14.  Colo. Rev. Stat. § 6-1-1306(1)(a)(IV).
  15. Id.
  16.  Colo. Rev. Stat. § 6-1-1313.
  17. Va. Code Ann. § 59.1-578(A)(1); Colo. Rev. Stat. § 6-1-1308(3).
  18. Va. Code Ann. § 59.1-578(A)(1); Colo. Rev. Stat. §§ 6-1-1308(2), (4).
  19.  Va. Code Ann. § 59.1-578(A)(3); Colo. Rev. Stat. § 6-1-1308(5).
  20. Va. Code Ann. § 59.1-578(A)(5); Colo. Rev. Stat. § 6-1-1308(7).
  21. Colo. Rev. Stat. § 6-1-1303(24); see Va. Code Ann. § 59.1-575 (similarly defining “personal data” but also including “precise geolocation data”). Connecticut Senate Bill 893 included similar provisions. See CT SB 893 § 5(a).
  22.  Va. Code Ann. §§ 59.1-577.A.-C.; Colo. Rev. Stat. § 6-1-1306(2); see CT SB 893 § 4.
  23. Va. Code Ann. § 59.1-577.C.; Colo. Rev. Stat. § 6-1-1306(3).
  24. Id.
  25. Va. Code Ann. § 59.1-580.A. (also requiring a data protection assessment for “[a]ny processing activities involving personal data that present a heightened risk of harm to consumers”); see Colo. Rev. Stat. § 6-1-1309.
  26. Va. Code Ann. § 59.1-580.C.
  27. Bloomberg Law, Top Takeaways from a Year of CCPA Enforcement (published Aug. 6, 2021)
  28.  Va. Code Ann. § 59.1-584.A.
  29. Va. Code Ann. § 59.1-583.
  30. Va. Code Ann. § 59.1-584.
  31. Va. Code Ann. § 59.1-584.C.-D.
  32. Va. Code Ann. § 59.1-585.
  33. Unlike the CCPA, the VCDPA and the CoPA do not have a carve-out that allows consumers to bring an action for statutory damages in the event of a data breach. See Colo. Rev. Stat. § 6-1-1310.
  34. Colo. Rev. Stat. § 6-1-1311.
  35.  Id.
  36.  Id.
  37. Colo. Rev. Stat. §§ 6-1-1311 and 6-1-112.

©2021 Troutman Pepper Hamilton Sanders LLP

Article By Seth M. Erickson, Ashley L. Taylor, Jr.

and Sadia Mirza of  Troutman Pepper
For more articles on privacy law, visit the NLRCommunications, Media & Internet section.

 

Intellectual Property Consolidation in the Agriculture Industry

Ever since agencies around the world such as the USPTO, USDA, and Union for the Protection of New Varieties of Plants (UPOV) have started recognizing and enforcing intellectual property rights relating to plants, there has been a slow yet massive consolidation in global seed markets.  This article discusses a brief history of how intellectual property rights and lax antitrust enforcement in the seed industry created one of the largest industry consolidations and how the current Administration seems to be taking steps in the right direction.

Intellectual Property in the Agriculture Industry

In 1930, the United States began granting plant patents and the USPTO issued the first plant patent in 1931 for a rose.  The UPOV is an international organization that was founded in 1961 to acknowledge and make available exclusive property rights for breeders of new plant varieties in all member states to the UPOV Convention. The U.S. Plant Variety Protection Act (PVPA) was enacted by Congress in 1970 to encourage the development of new varieties and to make them available to the public.  The Plant Variety Protection Act established in the Department of Agriculture an office to be known as the Plant Variety Protection Office.  These regulations are all very important for the protection and continued innovation of certain varieties of crops and plants.  However, when genetically modified seeds were introduced in 1996, seed companies began to take advantage of these protections and began to invest heavily in amassing as many seed-related IP rights as they could.  As these companies have merged and acquired smaller businesses, they remove competition from the industry, harming farmers, families, and consumers.

There are many ways that companies protect intellectual property in the agricultural industry.  For example, companies file for utility patents to protect a wide variety of plant-related inventions, such as breeding methods, plant-based chemicals, plant parts, and plant products. Plant patents are unique to the United States and provide protection to any distinct and new variety of plant that has been asexually reproduced, other than a tuber-propagated plant or a plant found in an uncultivated state.  Plant Variety Protection certificates, which are similar to plant patents, provide certain exclusive rights to breeders of any new, distinct, uniform, and stable sexually or asexually reproduced or tuber-propagated plant varieties.  Other rights, known as Breeders’ Rights, exist in other countries outside the United States and are very similar to the Plant Variety Protection regulations.  These protections generally last for 20 years from the date of filing and, according to the World Intellectual Property Organization, the patent owner has the right to decide who may – or may not – use the patented invention for the period in which the invention is protected.

The Key Players in the Agriculture Industry

Monsanto was a multinational agricultural biotechnology corporation founded in 1901 and based in the United States.  In 1970, Monsanto scientist John Franz discovered that glyphosate was an herbicide and quickly patented it as such.  In 1974, Monsanto brought the patented glyphosate herbicide to the market using the tradename “Roundup.”  In 1996, Monsanto created the first genetically engineered (GE), glyphosate-resistant crop, causing Roundup-resistant soybeans to be planted commercially throughout the United States.  By 1998, glyphosate-resistant corn was available on the market, and Monsanto became the largest supplier of these new GE, “Roundup-Ready” seeds.  This was such a breakthrough in the agriculture industry that in 2003, Roundup-Ready seeds accounted for about 90% of the genetically modified seeds planted around the globe.

As with many industries, the agriculture industry has those companies that are at the top and those that are not.  The agriculture industry’s “Big Six” companies—Monsanto, DuPont, Syngenta, Dow, Bayer, and BASF—turned into the “Big Four”—ChemChina, Corteva, Bayer, and BASF— after a series of mergers and acquisitions that took place in the last decade with very little oversight from some of the antitrust authorities in the United States and around the world.  As a result of these mergers, the “Big Four” companies now control around 60% of the proprietary seed in the world market.

The Consolidation of the Seed Industry

Dr. Phil Howard from Michigan State University discussed the tremendous consolidation of the commercial seed industry in one of his first publications, 2009’s Visualizing Consolidation in the Global Seed Industry: 1996-2008.  Dr. Howard describes how the hybrid-seed corn industry of 1930, the enforcement of patent-like protections, and especially the commercialization of fully patent-protected transgenic, genetically engineered seeds in the mid-late 1990s triggered a wave of consolidation in the agricultural industry.  To make matters worse, when these companies consolidated and amassed massive intellectual property portfolios, it was not uncommon for seed rights to be bundled with other inputs to protect profits in other, agrochemical divisions.  For example, as Dr. Howard details in Visualizing Consolidation, in order to use Monsanto’s herbicide-tolerant transgenic seed, farmers are required to also use Monsanto’s proprietary glyphosate herbicide, rather than a generic herbicide.  Essentially, if you were buying Roundup-Ready seed, you were buying Roundup herbicide, and if you were using Roundup herbicide, it was probably a good idea to buy Roundup-Ready seed.  This type of competitive business practice is one that eventually creates a multitude of problems for smaller, independent businesses, breeders, and farmers.

Antitrust and Anti-Competition in America

Antitrust laws are not a new concept in American society.  Antitrust laws are statutes and regulations that are designed to promote the overall competition in the market by promoting free, open, and competitive markets.  Congress passed the first antitrust law in 1890 when it wrote the Sherman Act, which made it illegal for companies to enter into agreements to compete with one another, resulting in price fixing and monopoly power.  Several years later, in 1914, Congress passed the Clayton Act and Federal Trade Commission Act to protect American consumers by giving the Federal Trade Commission (FTC) and the Department of Justice (DOJ) the authority to oversee and review mergers and acquisitions that are likely to stifle competition.  Under the Hart-Scott-Rodino Act, the FTC and DOJ review most of the proposed transactions that affect commerce in the United States and either agency can take legal action to block deals that it believes would “substantially lessen competition.”

While these laws are all beneficial in theory, their implementation in the agricultural industry has been lacking to say the least.  According to a study in 2018, Bayer alone is estimated to control 35% of corn seed, 28% of soybean seed, and 70% of cottonseed in the global market!  Even more alarming may be the USDA’s 2014 report citing concerns that glyphosate-resistant crops have become ubiquitous with American agriculture with 93% of soybeans, 85% of corn, and 82% of cotton planted being genetically modified to be glyphosate-resistant.  The herbicides that are used to combat the weeds surrounding the crops, in many cases, are supplied by the same company that provides the seeds.

Promoting Competition in the Agriculture Industry

It has been almost a century since the first antitrust laws were enacted, and yet the problem of corporate consolidations remains in many industries across America.  On July 9, 2021, the Biden Administration signed an executive order aimed to promote competition within various industries in the United States.  The order includes 72 initiatives by more than a dozen federal agencies to promptly tackle some of the most pressing competition problems across our economy.  According to the Administration, this order is a “whole-of-government” approach to drive down prices for consumers, increase wages for workers, and facilitate innovation. This was a major step in the right direction to weaken the power that major businesses have obtained as a result of corporate consolidation in industries like healthcare, technology, transportation, and especially agriculture.

This Executive Order also established the White House Competition Council to drive forward the Administration’s whole-of-government effort to promote competition.  On September 10, 2021, the Competition Council held its inaugural meeting to discuss promoting pro-competitive policies and new ways of delivering concrete benefits to America’s consumers, workers, farmers, and small businesses.  During the meeting, the heads of the Department of Health and Human Services, the Department of Transportation, the Department of Justice, the United States Department of Agriculture, and the Federal Trade Commission briefed the council members on their efforts to implement the directives of the Executive Order.

The Challenge of Facing the Consolidated Agriculture Industry

According to an October 20, 2021 report by Thomson Reuters, Tom Vilsack, the U.S. Secretary of Agriculture, said that the Biden Administration plans to take a hard look at the consolidation of the seed industry and figure out “why it’s structured the way it’s structured” and “whether these long patents make sense.”  The White House Competition Council is certainly faced with a difficult challenge to parse through both anti-competition law and intellectual property law.  For centuries these bodies of law have caused great debate.  One body of law restricts monopolization wherein the later grants monopolistic opportunities.

There is no doubt that any changes to the current seed industry scene would shake things up.  But what exactly would that look like?  Are we going to see the “Big-4” morph into another, new identity?  Are changes to the patent law system likely?  Whatever happens, the agriculture industry will likely pay close attention to the actions of the White House Competition Council over the next couple months.

Article By Reinier R. Smit of Summa PLLC

Copyright 2021 Summa PLLC All Rights Reserved

Biden Signs Largest Climate and Resiliency Infrastructure Bill in U.S. History

Today President Biden signed H.R. 3684, the “Infrastructure Investment and Jobs Act” (IIJA), into law after months of negotiations on both the bill itself and the still pending “Build Back Better Act”. These two measures encapsulate the Biden Administration’s legislative priorities, many of which were rolled out during the campaign. The U.S. Senate passed the IIJA on August 10 by a vote of 69-30. Last week, on November 5, the House of Representatives passed the measure by a vote of 228-206. The months long negotiations resulted in bipartisan support for the IIJA in both the House and Senate.

Broadly, the IIJA:

Provides Funding: The funds provided are appropriated dollars, allowing Executive Branch agencies to distribute funds without further legislative action. The funds provided are for both new and existing federal programs for surface transportation, energy infrastructure, transportation safety, transit, broadband, ports and waterways, airports, drinking water and wastewater. ​

Expedites Permitting: There are several new programs created to support transmission development and streamline the permitting of new energy infrastructure, such as electric transmission

Provides New Authorities and Creates New Programs: Various federal agencies are required to develop new programs and processes, all aimed at deploying clean energy or improving cybersecurity​.

The IIJA represents a monumental investment in all types of infrastructure. However, most significantly, it will provide the largest federal investment since the New Deal in the Nation’s infrastructure and in developing the tools to curb carbon emissions and harden infrastructure to increase resiliency against the current global challenge of climate change. The Department of Energy and other federal agencies will receive $65 billion for power and grid related programs, including grid infrastructure, resiliency investments, clean energy demonstration projects and cybersecurity. An additional $7.5 billion will be available for alternative fueling infrastructure for grants to build public fueling systems, including electric and hydrogen fuels, establish alternative fuel corridors, and find ways to recycle used electric vehicle batteries to be reused as energy storage devices.

In July, our team shared the details of the bill passed by the Senate Energy and Natural Resources Committee. As signed into law, this earlier summary still accurately reflects the details of the funding that will be provided.

Implementation and Timing of Funding: Agencies will now be tasked with standing-up new or expanding existing programs to award federal funds to eligible infrastructure projects. Agency offices will work over the coming weeks to establish grant program parameters, develop, and publish solicitations for applications, set timelines for awards and oversee implementation of awarded funds.

The IIJA included deadlines for some agency actions, requiring that programs be established in 60, 90, or 180 days. Note that many of the agency offices, particularly within the Department of Energy, remain functioning without political appointees. For instance, the Office of Electricity, which will be responsible for issuing $3 billion in grants through the Smart Grid Investment Matching Grant Program, is operating under an Acting Assistant Secretary until the Senate confirms the Biden Administration’s nominee for that post. There are no legal or political impediments to getting funding programs up and running without a political appointee heading any federal office, but political influence on the pace and timing for the process may be limited.

Certain programs will automatically send funds to states through existing formula funding programs. Formula grant programs are non-competitive awards based on a predetermined formula. These programs are sometimes referred to as state-administered programs and are found throughout the federal government. Examples include the Environmental Protection Agency’s Clean and Drinking Water State Revolving Loan program, and the Department of Transportation’s Formula Funds for Rural Areas, and Buses and Bus Facilities formula grants programs. Once the states have received their federal allocations they will then make those funds available through their existing award structure, which may be competitive or formula-based.

How Your Organization Can Apply for Federal Funding Opportunities: As agencies establish parameters for new programs or develop solicitations for existing programs, it is important to engage with the agencies in this process to ensure your project will meet agency program criteria for a funding award, and to ensure solicitations are designed to support your infrastructure projects. Our professionals have had significant success in assisting clients through these processes, and successfully assisted clients in the development of grant applications for awards under both Democratic and Republican Administrations. Contact any of our professionals to learn more about what grant programs your organization may be eligible for, how to engage with the agencies, as well as apply and partner with the federal government to ensure funding is awarded for your project.

What’s Next, Human Infrastructure: The IIJA represents only the provisions in the Biden agenda that were able to earn bipartisan support. The remainder of the President’s priorities are encapsulated in a Budget Reconciliation bill, H.R. 5376, the “Build Back Better Act”, (BBBA) developed by House and Senate Democrats and requiring only a 50-vote threshold in the Senate.

For months, the Build Back Better Act and IIJA and were linked in the legislative process by President Biden and House Speaker Nancy Pelosi (D-CA) who demanded that one not pass without the other. This approach resulted in a rift between the Democratic Party’s moderate and progressive members. While the final outcome for the IIJA resulted in bipartisan votes in both the House and Senate, passage only came after a deal was struck between moderates and progressives within the Democratic Caucus to decouple the IIJA and the “Build Back Better Act”.

House Speaker Nancy Pelosi has publicly said that the “Build Back Better Act” will be brought to the House Floor during the week of November 15. Senate Leadership has made no such promise for timely action. In addition, some House Democrats and some Senators have announced they want to see the details of budget scoring – what individual provisions will cost – from the Congressional Budget Office (CBO) and the Joint Tax Committee – before proceeding. Some limited data has begun to be released by the CBO but not any numbers covering many of the most complex and controversial programs. The schedule may be accelerated if Democrats and Republicans cannot come to an agreement to increase the debt ceiling, a must-pass measure that may need to be included in the Budget Reconciliation process. As negotiations continue, the content of the legislation passed by the House is expected to be altered significantly during Senate consideration. Should that be the case, the House will vote a second time on the measure as amended by the Senate.

Article By: Tracy Nagelbush Tolk and Tiffany Ganthier from Van Ness Feldman LLP

© 2021 Van Ness Feldman LLP

POT HOLE: Cannabis Companies Getting Caught in the Mini-TCPA Trap

One of the biggest TCPA trends earlier in the year was the onslaught of suits against cannabis companies related to marketing texts.

After my big interview with the National Cannabis Industry Association, those filings went down as dispensary TCPA awareness went up. (You’re welcome.)

But the trend of high dollar TCPA class suits against pot dealers seems to have moved South for the winter–down to the Sunshine State.

We’ve picked up a few new recent filings brought under the Florida Telephone Solicitation Act (Mini-TCPA). The suits allege that the blast text platforms used to send marketing texts meet the state’s extremely broad definition of an autodialer and require express written consent (which is allegedly missing).

For instance in the latest suit filed earlier today, the allegations focus on the automatic selection and dialing of numbers: Defendant utilized a computer software system that automatically selected and dialed Plaintiff’s and the Class members’ telephone numbers.

Notably this suit appears to be brought against a cannabis delivery platform and not an actual dispensary.

Read all about it here: Herban Delivery

Per usual the suit seeks to represent all individuals receiving similar messages in the state of Florida. It is brought by the folks at Shamis and Gentile who file a lot of these things.

© Copyright 2021 Squire Patton Boggs (US) LLP

Article By Eric J. Troutman of Squire Patton Boggs (US) LLP

For more articles on the TCPA, visit the NLR Communications, Media & Internet section.

H.R. 3684: Infrastructure Investment and Jobs Act

On November 5, the U.S. House of Representatives approved a $1.2 trillion infrastructure spending bill that will make historic investments in core infrastructure priorities including roads and bridges, rail, transit, ports, airports, the electric grid, and broadband.

The legislation, titled the Infrastructure Investment and Jobs Act (“IIJA”), will have major implications for states and municipalities of all sizes, as well as the entities involved in responding to governments’ needs for hard and cyber infrastructure.

Improvements to roadways, ports and mass transit are the focus of the legislation and the majority of the funding is targeted at these traditional hard infrastructure projects. U.S. Senator Rob Portman (R-OH) has championed the massive infrastructure bill and pushed for its passage.

This weekend, Senator Portman noted the massive impact the IIJA will have on Ohio, highlighting the bill’s bridge investment program which will award competitive grants to certain governmental entities to improve the condition of bridges. “This additional federal funding means we are one step closer to a solution for the Brent Spence Bridge,” Portman said.

The Brent Spence Bridge, which connects Cincinnati, Ohio with Covington, Kentucky has one of the busiest trucking routes in the nation. Questions about its safety and long shutdowns for repair have long concerned area residents as well as the business owners responsible for the more than $400 billion of freight which passes over the bridge every year.

While hard infrastructure priorities like bridge maintenance, port modernization, freight rail, and highway improvements account for a majority of the new spending appropriated by the bill (which totals $550 billion over five years), a sizable portion is dedicated to the expansion of broadband networks and the improvement of cybersecurity.

The new cybersecurity grant program and record-setting investments in broadband development could be game changing for state and local leaders wishing to modernize and protect their communities in these ways.

The U.S. Senate approved the IIJA in August 2020. Friday’s vote means the infrastructure bill will now move to the desk of President Joe Biden, who has indicated a bill signing ceremony will happen soon. Answers to questions about the billions of dollars in new infrastructure grants and programming are below.

Question: How will the money be distributed? 

Answer: The IIJA contains formulaic allocations of funds as well as earmarks and competitive grants. Some categories and sub-categories contain both non-competitive and competitive grants.

  • NON-COMPETITIVE FUNDING ALLOCATION PROCESSES
    • Formulas dictated by the bill are based on criteria like state population, or, potentially for specific items, users (ex: transit funds potentially determined by ridership)
    • Once the money is directed to the states, the local bureaucrats are able to make the important decisions about which projects deserve the funding.
    • States can also decide to allocate some of the funding to the county or city governments within their state
  • EARMARKS AND COMPETITIVE GRANT PROCESSES
    • Earmarks override state plans for how infrastructure funds should be spent. “Earmarks come out of the money that the state was going to get anyway.”
    • Localities must compete for Competitive Grants via an application process. The U.S. Department of Transportation’s Discretionary Grant Process is officially outlined on their website.
    • Generally, the award of competitive grants can be influenced by advocates who confer with decisionmakers in the Executive Branch about the merits of certain proposals.

Question: Which projects will qualify for funding?

Answer: The bill details specific funding streams for the specific projects included in its provisions. Categories of projects included in the $550 billion in new spending are below.

  • Roads, Bridges, & Major Projects: $110B — Funds new, dedicated grant program to replace and repair bridges and increases funding for the major project competitive grant programs. Preserves the 90/10 split of federal highway aid to states.
  • Passenger and Freight Rail: $66B — Provides targeted funding for the Amtrak National Network for new service and dedicated funding to address repair backlogs. Increases funding for freight rail and safety.
  • Safety and Research: $11B — Addresses highway, pedestrian, pipeline, and other safety areas (highway safety accounts for the bulk of this funding).
  • Public Transit: $39.2B — Funds nation’s transit system repair backlog, which includes buses, rail cars, transit stations, track, signals, and power systems. This allocation also includes money to create new bus routes and increase accessibility to public transit for those with physical mobility challenges.
  • Broadband: $65B — Funds grants to states for broadband deployment and other efforts to address access issues in rural areas and low-income communities. Expands eligible private activity bond projects to include broadband infrastructure.
  • Airports: $25B — Increases Airport Improvement grant amounts for runways, gates, & taxiways and authorizes a new Airport Terminal Improvement program.
  • Ports and Waterways: $17.4B — Provides funding for waterway and coastal infrastructure, inland waterway improvements, port infrastructure, and land ports of entry through the Army Corps, DOT, Coast Guard, the GSA, and DHS.
  • Water Infrastructure: $54B — Provides a $15 billion for lead service line replacement and $10 billion to address PFAS in water, in addition to other items.
  • Power and Grid: $65B — Funds grid reliability and resiliency projects and support for a Grid Development Authority; critical minerals and supply chains for clean energy technology; key technologies like carbon capture, hydrogen, direct air capture, and energy efficiency; and energy demonstration projects from the bipartisan Energy Act of 2020.
  • Resiliency: $46B — Funds cybersecurity projects to address critical infrastructure needs, flood mitigation, wildfire, drought, coastal resiliency, waste management, ecosystem restoration, and weatherization.
  • Low-Carbon and Zero-Emission School Buses & Ferries: $7.5B — Funds and authorizes the adoption of low-carbon and zero-emission school buses, including through hydrogen, propane, LNG, compressed natural gas, biofuel, and electric technologies. Provides support for a pilot program for low emission ferries and rural ferry systems.
  • Electric Vehicle Charging: $7.5B — Funds alternative fuel corridors and a national build out of electric vehicle charging infrastructure. The federal funding will have a particular focus on rural and/or disadvantaged communities.
  • Reconnecting Communities: $1B — Provides dedicated funding for planning, design, demolition, and reconstruction of street grids, parks, or other infrastructure (funding is especially targeted at infrastructure which is deteriorating due to age).
  • Addressing Legacy Pollution: $21B — Funds to clean up brownfield and superfund sites, reclaim abandoned mine lands, and plug orphan oil and gas wells, improving public health and creating good-paying jobs.

Article By Katherine M. Caprez of Roetzel & Andress LPA

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©2021 Roetzel & Andress

Meta Announces the End of Facial Recognition Technology on Facebook

The Facebook company now known as Meta announced this week that it is shutting down the Face Recognition system on Facebook.  Meta stated that this is part of a company-wide move to limit the use of facial recognition technology in its products. What does this mean? If you have a Facebook page and you previously opted-in to be automatically recognized in photos and videos on Facebook, this feature will be disabled. Meta also announced that it is deleting more than a billion people’s individual facial recognition templates.

Meta claims in a press statement released this week that it needs to “weigh the positive use cases for facial recognition against growing societal concerns, especially as regulators have yet to provide clear rules.”  Although Meta doesn’t elaborate on what the details are of the growing societal concerns, the company states that it seeks to move toward narrower forms of personal authentication.

Copyright © 2021 Robinson & Cole LLP. All rights reserved.

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