Leave It to the States? Effects of Federal Environmental Policy Retrenchment

Abstract Are the local effects of federal environmental policy rollbacks conditional on state enforcement? Environmental federalism scholarship suggests that interstate competition has led some states with enforcement primacy over federal statutes to enhance standards in a “race to the top,” while others have minimized standards in a “race to the bottom.” Focusing on a Trump-era administrative rule that narrowed federal surface water protections under the Clean Water Act (CWA), I assess whether the rule led to adverse local outcomes and whether state CWA enforcement variation moderated these effects. Results show that public water systems sourcing from surface water incurred more health violations following the rule’s implementation, particularly in states lacking independent protections for waters that lost federal coverage or with laws prohibiting their agencies from enforcing standards beyond federal requirements. These findings indicate that, in cooperative federalism arrangements, state enforcement institutions condition the local effects of federal environmental retrenchment.