Overnight Regulation: Senators push DOJ to review online gambling opinion | EPA holds steady on biofuel mandate targets | Trump moves to fill financial regulatory posts

Welcome to Overnight Regulations, your daily rundown of news from the federal agencies, Capitol Hill and the courts. It’s Thursday evening here in Washington where the Senate is gearing up for a big vote on tax reform. 

See where Republicans senators stand here.

 

THE BIG STORY 

Sens. Lindsey Graham (R-S.C.) and Dianne Feinstein (D-Calif.) are pushing Deputy Attorney General Rod Rosenstein to take action and reverse a 2011 Department of Justice opinion that changed the agency’s long-held understanding that online gambling is prohibited under federal law.

In a letter to Rosenstein last week, Graham and Feinstein noted that the department had interpreted the 1961 Wire Act as prohibiting online gambling up until the 2011 decision from the agency’s Office of Legal Counsel, which said the Wire Act only applies to sports betting.  

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“Internet gambling takes gambling too far,” they wrote. “It preys on children and society’s most vulnerable.” 

Their biggest concerns: 

• That FBI lacks the resources to effectively oversee a robust internet gambling industry.
• That allowing online gambling could turn every smartphone, tablet and personal computer into an around-the-clock casino.

“Online casinos are already opening across state lines pursuant to compacts and states are contemplating opening up their online casinos to foreign markets,” they wrote.

“We fear that unless DOJ promptly revisits its 2011 opinion, our prediction that online casinos could sweep across our country could come to pass.”

Read the story here. 

 

REG ROUNDUP 

Energy: The Environmental Protection Agency (EPA) has backed off its proposal to slightly cut the federal biofuels mandate.

The agency finalized a rule Thursday that would instead hold blending quotas under the Renewable Fuels Standard (RFS) flat for 2018.

The rule will require refiners to mix 19.29 billion gallons of renewable fuels into the gasoline supply in 2018. That’s about 25 percent lower than the target Congress established in a 2007 law, but the EPA has routinely finalized RFS blending quotas below the statuary requirements.

EPA regulators will require refiners to blend 15 billion gallons of conventional corn-based ethanol into the fuel supply, as well as 4.29 billion gallons of advanced biofuels. The agency will also mandate 2.1 billion gallons of biodiesel to be blended into the diesel fuel supply.

In July, the EPA proposed an overall 19.25 billion-gallon blending target, a level that included cuts to the biodiesel target.

The RFS mandates how much ethanol and other biofuels refiners are required to mix into the fuel supply. Biofuels producers have long pushed the EPA to scale up the quotas, while refiners and the oil industry have urged the opposite.

Devin Henry has the story here.

 

Finance: President Trump on Wednesday made nominations for two key economic policy positions, seeking to fill piling vacancies at the Federal Reserve and reshape the Financial Stability Oversight Council (FSOC).

Trump nominated Carnegie Mellon University economics professor Marvin Goodfriend to the Federal Reserve Board and insurance attorney Thomas Workman to FSOC. The two would play critical roles in shaping economic and financial regulatory policy through independent agencies.

Goodfriend worked for the Federal Reserve Bank of Richmond between 1978 and 2005, serving as the director of research and a policy adviser. He also served as an economist for the Fed and was on President Reagan’s Council of Economic Advisors.

Goodfriend was nominated to fill the seat vacated by former Fed Governor Sarah Bloom Raskin in 2014. The Fed is facing a slew of upcoming vacancies that could leave the bank without a quorum of governors.

Without a full quorum of four governors, the Fed board would be unable to legally make key monetary and regulatory moves.

Federal Reserve Board Chairwoman Janet Yellen said she will resign from the bank upon the confirmation of Jerome Powell, who Trump nominated to be her successor. Former Vice Chairman Stanley Fischer left the bank in October and former Fed Governor Dan Tarullo resigned in April.

The Fed’s vacancies give Trump the chance to move the bank rightward.

Sylvan Lane has the story here.

 

Finance: Randy Quarles, the Federal Reserve vice chairman of supervision, said Thursday that the widespread use of digital currencies could threaten financial stability, adding that central banks should “tread cautiously” when considering creating their own.

“While these digital currencies may not pose major concerns at their current levels of use, more serious financial stability issues may result if they achieve wide-scale usage,” Quarles said.

Quarles, who oversees financial regulatory issues for the Fed, said in the Thursday speech that while digital currencies such as Bitcoin could yield useful innovation in finance, they also pose several risks to the global financial system.

His comments come a day after the New York Fed president said the central bank has been thinking about whether to create its own digital currency.

Sylvan Lane has the story here. 

 

Environment: The House voted Thursday to overturn the Obama administration’s decision to temporarily ban mining in an area of northern Minnesota’s Superior National Forest.

The Minnesota’s Economic Rights in the Superior National Forest, or MINER, Act, passed 216-204, with nearly all Republicans in support and nearly all Democrats opposed.

The Obama administration’s decision, made the day before former President Obama left office, blocked mining for two years in an area of the forest near the Boundary Waters Canoe Area Wilderness, in an effort to protect those waters from potential mine waste output.

Timothy Cama has the story here. 

 

Environment: President Trump’s pick to lead the nation’s top atmospheric office said in his confirmation hearing Wednesday that he agrees that humans are the primary cause of climate change, according to The Washington Post.

Barry Myers, CEO of the private weather forecasting company AccuWeather, was nominated last month to lead the National Oceanic and Atmospheric Administration (NOAA).

Sen. Ed Markey (D-Mass.) asked Myers if he agrees with the recent federal report that said humans are the primary driver of climate change, to which Myers responded affirmatively, the Post reported.

“I have no reason to disagree with the reports,” he said.

Myers then said “yes” when Markey asked, “So you agree humans are the main cause of climate change?”

Myers’s position is a departure from other Trump administration science appointees. EPA Administrator Scott Pruitt and Energy Secretary Rick Perry have publicly questioned the science behind climate change, including the role of humans.

Avery Anapol has more here.

 

Administration: A senior Democratic lawmaker is calling on Republicans to ramp up oversight of Trump administration officials’ use of private planes at taxpayer expense.

The Thursday letter from Rep. Frank Pallone Jr. (N.J.), the ranking Democrat on the House Energy and Commerce Committee, to Chairman Greg Walden (R-Ore.), calls for the panel to hold oversight hearings.

Pallone cites Tom Price, who resigned as Health and Human Services Secretary following his extensive use of private planes for travel. He also points to reports of private jet travel by Environmental Protection Agency Administrator Scott Pruitt and Secretary of Energy Rick Perry.

Peter Sullivan has the story here. 

 

Transportation: The Department of Homeland Security (DHS) does not have enough money to install enhanced screening technologies at every airport in the United States, the agency told Congress on Thursday.

“We have some funding for the CT technology. We do not have the funding to deploy it at every airport,” acting DHS Secretary Elaine Duke said during a House Homeland Security Committee hearing. “To buy it for every airport would require much more than a reprogramming” of funds from Congress.

Melanie Zanona has the story here.

 

LISTEN TO THE HILL’S NEW TWICE-DAILY PODCASTS!

In today’s PM View, your daily evening update on what went down in Washington: Secretary of State Rex Tillerson’s future is once again in doubt, but President Trump doesn’t like having to say “you’re fired”; the GOP tax plan steams ahead; and Congress seeks more time to avert a government shutdown.

Host Niv Elis talks to the Hill’s Jordan Fabian, Naomi Jagoda, and Cristina Marcos about what happened today on Capitol Hill. Listen here.

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IN OTHER NEWS 

The Trump administration’s inevitable drift toward yes-men – The Washington Post

Score one for corn: In battle over biofuel, a rare setback for big oil – The New York Times

Hate crime training for police is often inadequate, sometimes nonexistent – ProPublica

DeVos on Trump ‘Pocahontas’ comment: We should think before we speak – USA Today