U.S. agencies moving forward with proposing fuel economy revisions

By David Shepardson WASHINGTON (Reuters) - The Trump administration is moving ahead with plans to submit a series of options for softening fuel efficiency standards to the White House for approval in the coming week, two officials briefed on the matter Tuesday said. The U.S. Transportation Department has drafted a proposal likely to be made public this month that would freeze vehicle requirements at 2020 levels through 2026. It is set to formally go to the White House for review next week, officials said. The freeze is the preferred option, but is one of many options in the proposal set to be made public in the first week of June, two officials said. On Friday, President Donald Trump met with auto industry leaders over the vehicle emissions rules. Afterward, two major auto industry trade groups said in a joint statement that Trump expressed an "openness to a discussion with California on an expedited basis." California, the most populous U.S. state, has long been allowed by an Environmental Protection Agency waiver to impose stricter standards than Washington does on vehicle emissions of some pollutants, but the state agreed to adopt the emissions rules of the Obama administration in 2011. California and 16 other states covering about 40 percent of the U.S. population sued earlier this month to block the Trump administration’s efforts to weaken the fuel efficiency requirements. On Tuesday, a group of environmental groups including the Environmental Defense Found, Center for Biological Diversity, the Sierra Club and Union for Concerned Scientists also filed suit. The Transportation Department proposal asserts that a 1975 federal law preempts states from imposing emissions rules. Automakers want the White House and California to reach an agreement on maintaining national standards, fearing a prolonged legal battle could leave them facing two different sets of rules and extended uncertainty. White House aides met with Environmental Protection Agency and Transportation Department officials on Tuesday to talk about the status of the effort. Automaker and administration officials say more talks with California are expected to take place - including a long-planned meeting next week where fuel rules are expected to be discussed - but the administration will not delay the rollout of the proposal for more talks with California. Mitch Bainwol, who heads the Alliance of Automobile Manufacturers representing General Motors Co, Volkswagen AG , Toyota Motor Corp and others and who attended the Trump meeting, said Tuesday he still thinks a deal can be had. "This is a solvable problem. There's an outcome here that's good for California, that's good for this administration and terrific for the men and women who work for this sector." A California Air Resources board spokesman, Stanley Young, said Tuesday the state has not been contacted by the administration since Friday's event. (Reporting by David Shepardson; Editing by Leslie Adler)