ESFPA E-News

EUDR Issues Low Risk Status for U.S. Forests

Last week the European Union has classified the United States as low risk under the European Union Deforestation Rule (EUDR). We expect this announcement to open a robust discussion in the EU on streamlining and simplification of the law. ESFPA has worked with several of our national affiliates over the past two years on the EUDR and as noted late last year the imposition of the rule has been delayed until December 2025. This is the first series of revised guidance that we expect to see over the coming months.

Some key aspects of this action:

1.) Country benchmarking highlights:

• As expected, the United States is listed as low risk, as are all EU countries, China, Canada, Australia, New Zealand, and Uruguay. The Commission methodology to classify countries as low risk is based on the rate of deforestation and forest degradation, rate of expansion of agriculture land for EUDR commodities, and productive trends of relevant commodities and of relevant products.
• Only four countries - Belarus, North Korea, Myanmar, and Russia - are listed as high risk. Only countries subject to UN or EU sanctions are classified as high risk.
• All other countries are standard risk, including most Latin American countries (including Brazil), Indonesia, and Malaysia.

2.) While this is welcome news, it's important to note that the low-risk designation does not eliminate the administrative reporting requirements our sector faces under the law. Low-risk designation only reduces required audits by EU competent authorities to a minimum of 1%.

3.) This designation does not eliminate the major concern our sector has with the geolocation requirements under the EUDR for timber harvesting.

Our focus turns now to advocating for streamlined requirements for forest products from low-risk countries, namely the removal of geolocation requirements. We will continue our work with our national affiliates toward a focus on simplification.

DEC Seeks Public Comment on Eligibility Guidelines for Restoring and Expanding Forests

Last week DEC released for public review and comment draft eligibility guidelines to use Clean Water, Clean Air and Green Jobs Environmental Bond Act of 2022 (Bond Act) funding in support of tree planting and forest establishment projects.

The guidance press release can be found here. 

The full guidelines can be viewed in the May 21, 2025, Environmental Notice Bulletin. DEC is accepting public comments through Friday, June 20, 2025, at 5 p.m. Comments should be sent to Annabel Gregg, 625 Broadway, 5th Floor, Albany, NY 12233-3505, by phone at (518) 402-9409, or via email, dlfgrants@dec.ny.gov.

ESFPA will be drafting comments along with other state affiliates. Concerning in the guidance is the statement “Bond Act-funded forest establishment would focus on sustainable projects, excluding planting of trees for future timber harvests.” According to sources at DEC, Bond Counsel has determined that planting trees with the express purpose of supporting future harvests is not a “bondable” position. It is unclear how much we will change Bond Counsel’s opinion on this, but it clearly is tree focused and not in line with long-term sustainable management of forests for climate change.  It also raises questions as to whether plantings on lands enrolled in RPTL 480-a would be eligible and exactly how will DEC ensure that trees planted on private forest lands are monitored over the long haul.

As we delve deeper into the review of the guidance we will share our concerns.  But from a silvicultural perspective we have thus far found this truly surprising!

Webinar on NYS Mandatory Greenhouse Gas Reporting

On May 15^th NYS DEC held an informational webinar on the proposed Mandatory Greenhouse Gas Reporting Rule (Part 253). Below are links to the information that was covered:

• Webinar recording  

• Presentation  

As a reminder, the public comment period is open through 5:00 p.m. July 1, 2025. Information on how to submit a public comment can also be found on the Mandatory Greenhouse Gas Reporting webpage. 

ESFPA will be submitting comments on the proposed rule.  At this point we believe the most impacted facilities we have will be our paper manufacturing facilities. 

We are also asking all our densified pellet manufacturers to review the proposed reporting requirements for “fuel producers” to determine if you would be impacted.  As drafted, the rule only specifies fossil fuel and certain renewable gas and liquid fuels to report, but we would like to hear from our pellet manufacturers to see if you might be impacted.

EPA Delivers 2 RFS Rulemakings to the White House OMB

On May 14 the U.S. EPA delivered two RFS rulemakings to the White House OMB, beginning the interagency review process. One rule focuses on RFS RVOs and the other focuses on a partial waiver of the 2024 cellulosic RVO.

Click the link below to read more:

House Passes One Big Beautiful Bill (H.R. 1)

Late last week the House of Representatives voted 215-214 to advance a comprehensive budget reconciliation bill that encompasses GOP policy priorities. Piecing together several reports on the bill, the legislation includes robust tax provisions that revive and extend key business tax benefits, including full expensing, the research and development tax credit, and the Section 199A deduction for S-Corporations and pass-throughs. Regarding the latter, that benefit was bumped up to 23 percent (from 20 percent) and made permanent. To pay for these provisions and others, the bill reduces funding for food assistance programs and Medicaid and terminates tax credits authorized by the Inflation Reduction Act. The legislation does include a change in the State and Local Tax (SALT) deductions that benefit high state and local tax states such as New York.

The legislation now proceeds to the Senate, where the upper chamber will attempt to revise the measure. Senators have opined that they would like to make full expensing and the R&D credit permanent (the House bill only extends for 5 years). Republican supporters of some of the clean energy credits have also signaled that they would like to see changes to the House-passed bill's approach to renewable energy investments. However, given the extremely narrow margin in the House—the bill passed by one vote—it will be interesting to see how the Senate proceeds, knowing that significant revisions may disrupt the fragile framework in the lower chamber that enabled this bill to pass.

Forest sector related provisions in the “Big Bill” include:

• Recension of unobligated funds for non-federal landowners that include cost sharing for non-federal landowners. This impacts Climate Smart Forestry Funds previously awarded to New York.
• Recension of unobligated funds for private forestry and conservation programs provided through the Forest Legacy Program. This includes some Forest Legacy funding previously included for New York in the Rensselaer Plateau region.
• Recession of unobligated balances for the protection of old-growth forests on National Forest System land and to complete an inventory of old-growth forests and mature forests within the National Forest System. Not really relevant to New York.
• Emphasis but no funding for expanded timber production under the Forest Service and BLM by a minimum of 25%. Limited to federal lands and not any benefit to New York.

Expectations are that we could see a final reconciliation bill by the Fourth of July, but that is still a long way away and as we have seen voter sentiment is still playing out.

DEC Action on Advanced Clean Truck and Clean Car Rules

The New York State Department of Environmental Conservation (DEC) acted on Friday to help provide much-needed certainty to manufacturers following unprecedented federal actions that challenge implementation of clean vehicle requirements for Advanced Clean Turck (ACT) and and Advanced Clean Cars II (ACCII). For electric trucks:

• New York is issuing enforcement discretion to give manufacturers more flexibility in complying with ACT.
• DEC will not enforce certain provisions of the ACT regulation in terms of pursuing penalties associated with any medium- and heavy-duty ZEV deliveries or sales shortfalls associated with model years 2025 and 2026.
• Manufacturers can make available all model year 2025 and 2026 vehicles – whether ZEV or internal combustion engine (ICE) - and must still supply ICE vehicles to New York dealers and distributors.
• We’re still holding manufacturers accountable and advancing progress. Truck manufacturers must maintain and provide all model year 2025 and 2026 records of trucks produced and delivered for sale in New York.
• Also, manufacturers must make good faith efforts to comply with the ZEV sale percentages and not restrict availability of ZEV or ICE trucks to dealers.

For electric cars:

• DEC is working with manufacturers to address compliance concerns of ACC II and will not issue penalties until the conclusion of model year 2029, at the earliest.
• DEC will not enforce certain provisions of ACC, including not pursuing penalties associated with light-duty ZEV deliveries or sales shortfalls associated with model years 2026 and 2027.
• We’re still holding manufacturers accountable and keeping progress on track.
• Manufacturers must maintain and provide records on a monthly basis of all model year 2026 and 2027 passenger cars, light-duty trucks, and medium-duty passenger vehicles produced and delivered for sale in New York.
• Manufacturers must still make good faith efforts to supply ZEVs to New York dealers and distributors at the highest percentage possible relative to total sales and not restrict the availability of ZEV or ICE vehicles.

This achieves the much asked for delay in implementation of these rules for two years.  In the case of trucks this is something we have been working with a Coalition headed by the New York Trucking Association for several months. 

Click the link below to find more about this action: