Editor’s note: This is the first in a series of stories explaining how the federal government’s shift in climate change policy could affect New York state’s efforts to deal with the effects of climate change.
New York state lawmakers passed a landmark bill late last year that would make polluter companies pay into a fund that would fortify the state’s defenses against the effects of climate change.
But legal challenges are stalling the creation of that fund. Under the bill, companies could be compelled to pay up to $75 billion over the next 25 years into the fund to help communities affected by climate change adapt to their new realities.
Environmental advocates and state lawmakers say the bill, titled the “Climate Change Superfund Act,” could help ease the financial burden New York taxpayers will inevitably have to carry as climate events like prolonged flooding and ever-escalating record temperatures continue to unfold in unprecedented ways.
“This isn’t anymore about stopping climate change,” said Dror Ladin, a senior attorney at Earthjustice, a nonprofit litigating environmental issues across the country. “It’s about adapting to the climate change that’s already coming.”
Ladin argued right now is a pivotal time to adapt municipalities to potential climate events to come in the future.
Doing so, he noted, could better prepare governments for potential devastating damage to public and private infrastructure.
The $75 billion sought in the superfund would help bolster those adaptation strategies.
“[Climate change] could lead to all that without any backstop or an ability to pay for the necessary repairs,” he added. “This is something that we are already facing as a state.”
That bill faces two lawsuits: one filed in February by opponents in the fossil fuel industry and more than 20 Republican-controlled states; the other from the federal government filed in May.
The lawsuit filed by the U.S. Department of Justice is part of President Donald Trump’s larger crackdown on environmental regulations that seek to hold the fossil fuel industry accountable for their role in damaging the environment.
President Trump has promised from the start of his administration to “unleash” the nation’s energy industry. Part of that effort includes halting oversight on oil and gas companies in six Midwestern states, according to a recent report from CNN.
The president in April issued an executive order entitled “Protecting American Energy From State Overreach,” in which he vowed to remove “illegitimate impediments” to the energy industry — such as New York’s superfund initiative.
“Simply put, Americans are better off when the United States is energy dominant,” the president said in the executive order. “American energy dominance is threatened when State and local governments seek to regulate energy beyond their constitutional or statutory authorities.”
Elsewhere in the executive order, the president called the superfund an “extortion law.”
The allegations found in the DOJ’s legal complaint filed in May mirrors that language. In it, DOJ officials state that the U.S. is undergoing an energy crisis and that “overly restrictive policies” like the superfund are akin to a “a transparent monetary-extraction scheme,” officials wrote in the filing.
Prior to that suit, a coalition of fossil fuel industry interest groups and 22 Republican-led states in February responded to NY’s superfund legislation with a legal challenge of their own. Their rationale is similar to that used by the DOJ’s.
In light of the lawsuits, Gov. Kathy Hochul says she will fight to preserve the bill.
“Gov. [Kathy] Hochul proudly signed the Climate Superfund Act because she believes corporate polluters should pay for the damage done to our environment — not everyday New Yorkers,” Paul DeMichele, a spokesperson for the governor, said in a statement. “We look forward to defending this landmark legislation in court and defeating Big Oil once again.”
How would the superfund work?
The Climate Change Superfund Act in 2024 passed both state legislative chambers and was signed by the governor.
The bill established the climate change adaptation cost recovery program, which will require companies that have contributed significantly to the buildup of the greenhouse gas pollution to pay up to $75 billion in the next 25 years.
Lawmakers propose polluting entities found to be responsible for more than 1 billion tons of covered greenhouse gas emissions from 2000 through 2018 would pay their share of a $3 billion pool each year starting in 2026. Ladin said he doesn’t believe there are any companies based in New York state who fit this criteria.
“The biggest fossil fuel polluters are out of state,” Ladin said.
The legislation would likely target big oil producers like Exxonmobil and Saudi Aramco, Ladin said.
“It’s a little premature, because none of these companies have actually received any cost demands from the state,” Ladin said. “The state hasn’t yet allocated any responsibility.
By paying into the fund, environmental advocates say, polluters would bear a proportionate share of the cost of the necessary investments for state residents to be prepared for and cope with the effects of climate change.
Alice Hill, the David M. Rubenstein senior fellow for energy and the environment at the Council on Foreign Relations, said the superfund would guard against the fossil-fuel driven effects of wildfires, bigger stores, extreme precipitation and more.
“I think that one of the reasons why some have expressed concern about those funds is that they will call on the fossil fuel companies to pay the damages,” Hill said.
Flooding is likely to be an increasingly more destructive problem for areas of the state like New York City, lawmakers estimate.
Legislators used improving New York City’s sewer system, which will likely need overhauls to handle increased demand due to overtaxing flooding events, as an example of a project that would benefit from the superfund.
That project could cost around $100 billion, lawmakers wrote in the bill.
“The superfund is making a contribution so not all of that is on New York taxpayers,” Ladin said.
But the bill is still missing guidance, Ladin said. For instance, the state hasn’t released guidelines on how it will calculate the amount of greenhouse gas emissions companies are responsible for, Ladin said.
The deadline for the state to devise climate change adaptation cost recovery program regulations is December 2026.
‘They should not stand’
Ladin said the lawsuits facing the superfund have become almost an expectation that looms above legislative action that addresses climate change.
“For many people in this country, climate change has become politicized,” he said. “I wouldn’t take evidence of these lawsuits as some idea that New York has stepped out of line with what makes sense or with what’s good policy.”
Weeks after the May lawsuits from the DOJ and Republican states, legal experts told E&E News that judges are unlikely to find in the plaintiffs’ favor — because the foreign policy legal argument that undergirds the lawsuits has failed in the past.
The legal experts told E&E that Trump’s team has effectively invoked foreign affairs in other legal battles, including the dissolution of USAID and the invocation of the Alien Enemies Act (a wartime power), to expedite deportation operations.
They pointed to a similar lawsuit from George W. Bush’s administration, which tried and failed to argue that climate action could have negative ramifications on the nation’s foreign policy.
In that case, the Supreme Court sided with the state of Massachusetts and ruled that the federal Environmental Protection Agency must regulate carbon dioxide as a pollutant.
During his first term, Trump’s administration also advanced a similar legal argument against California’s cap-and-trade program — which is connected to a program counterpart in Quebec, Canada — but lost that challenge.
The president said the state superfund law is “fundamentally irreconcilable” with his plan to unleash American energy.
“They should not stand,” Trump said.
If Trump succeeds in knocking down climate policy reform, Ladin worries about the repercussions.
“If we don’t have those adaptation measures in place by the time the next super storm threatens us, then that could lead, potentially, to loss of life,” Ladin said.
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