| | | | |  | | By Alex Daugherty | With help from Tanya Snyder and Oriana Pawlyk
| | | — Every sector is vulnerable to cyber attacks from Russia, but experts worry that interconnected rail lines and transit systems will be prime targets. — Billy Nolen has been named the new temporary FAA chief, as outgoing administrator Steve Dickson is set to depart this week. — SEC's new climate rule could create complications for automakers' complex supply chains. IT'S MONDAY: You're reading Morning Transportation, your Washington policy guide to everything that moves. Send tips, pitches, feedback and song lyrics to us at adaugherty@politico.com, tsnyder@politico.com and opawlyk@politico.com. You can also find us on Twitter:@alextdaugherty, @TSnyderDC and @Oriana0214. "Head is on/I want out/I'm alone and I'm an easy target/Metronome/I want out/I'm alone and I'm an easy target"
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| | | STRETCHED THIN: The Biden administration has offered ominous warnings about looming Russian cyberattacks, Maggie Miller reports . The U.S. may have too many targets to defend them all: Banks, power companies, drugmakers, fuel suppliers and transportation are all at risk. "We should consider every sector vulnerable," said Jen Easterly, director of the Cybersecurity and Infrastructure Security Agency, during a three-hour call last week on the Russian hacking threat with around 13,000 participants from multiple industries. "In some ways, we should assume that disruptive cyber activity will occur." SURFACE PROBLEMS: Tanya has more on the vulnerabilities for trains and cars (check out Friday's newsletter for more potential aviation threats). In March, TSA issued voluntary guidance for freight, passenger rail and transit systems to enhance cyber efforts in line with CISA's "Shields Up" initiative, urging operators to address "escalating cybersecurity risks" affecting critical infrastructure sectors. DANGERS BREWING: Barry Einsig, global automotive and transportation executive at Cisco, said that as more that systems like traffic lights, road sensors and mass transit systems become connected with one another, both information and operational technology will be at risk. "Cybercriminals could potentially cause significant disruptions by shutting down public transit systems, altering traffic systems or otherwise remotely operating pieces of the city's transportation infrastructure," Einsig said. FREIGHT HUBS: Major ports, like those at Los Angeles and Long Beach, and freight rail hubs like Chicago are also tempting targets for attacks. In response to recent threats, the TSA in December 2021 directed owners and operators of "higher-risk" freight and passenger rail lines to designate a cybersecurity coordinator, report cybersecurity incidents to CISA within 24 hours, develop incident response plans and complete a cybersecurity vulnerability assessment.
| | | FAA LEADER, FOR NOW: The FAA on Saturday announced Nolen will step in as interim administrator following Dickson's departure next week, Oriana reports. Nolen was previously a senior vice president for safety, security and operations at Airlines for America, the trade group representing major U.S. carriers. He joined the FAA to lead its safety office earlier this year. "Billy Nolen has extensive expertise in aviation and a deep understanding of the vital role the FAA plays in ensuring the safety of the traveling public," Transportation Secretary Pete Buttigieg said Saturday. SEARCH ONGOING: Nolen was also a pilot for American Airlines and served in various leadership positions at American and Qantas Airways before joining WestJet in 2020. The FAA also said the White House is still "conducting a national search for a nominee to become the next permanent FAA administrator."
| | | SEC CLIMATE RULE COULD AFFECT 'EVERY COMPANY ON THE PLANET': The SEC'sproposal to require publicly traded companies to disclose climate-related risks — including their own greenhouse gas emissions — could impact not just on the big companies subject to SEC oversight, but "every company on the planet." That's according to Paul Marushka, CEO of Sphera Solutions, a firm that helps other companies track their own environmental footprint. Marushka said that the SEC's proposal to require reporting on the "scope 3" emissions from both upstream and downstream activities in a company's supply chain means "everything, down to the screw and all the widgets," in an automobile would have to be assessed for its environmental footprint. Because of the sprawling complexity of the automotive supply chain, for example, that could mean that each automaker would need to collect sustainability information from hundreds of small suppliers. And that info is"going to have to be verifiable, auditable and objective," Marushka said. "I'm pretty sure the big guys can afford it and may be getting ready for it. The rest of the world is not." He speculated that the SEC will get a deluge of concern about this "scope 3" requirement during its public comment period and will end up delaying the rule's implementation. Cause and effect: Investors have been tracking companies' environmental footprints for a while, but there hasn't been a standardized way to report them until now. Not only are they interested because the market increasingly demands sustainability, but because severe weather events will bring their own financial risks. Seth Lehman, senior director and co-head of U.S. transportation at Fitch Ratings, said that investors and credit rating agencies now consider at the consequences of sea level rise when looking at coastal bridge or airport projects, for example. "Maybe not now, maybe not 10 years from now, but maybe 25 years from now, while the bonds are still outstanding, all of a sudden that bridge would become inaccessible," Lehman told POLITICO. "We raise that concern strongly." PAY UP: The Biden administration has issued a final rule applying a major hike in penalties for automakers who fall short of fuel economy standards back through model year 2019 vehicles, Alex Guillén reports. The decision is expected to lead to hundreds of millions in additional annual penalties, though environmentalists argue it will also incentivize manufacturers to make more efficient vehicles in the coming years — a key part of President Joe Biden's goal of making sure 50 percent of all vehicles sold by 2030 are electric.
| | | PROFIT, PLEASE: House Transportation Committee Republicans are aiming at Amtrak with a bill, H.R. 7204 (117), whichwould "encourage economic sustainability of intercity passenger rail service." Railroad subcommittee ranking memberRick Crawford (R-Ark.) introduced the bill because, he said, Amtrak prioritizes urban connectivity over rural communities while failing to turn a profit. Crawford's bill isn't going anywhere in the current Congress, but could be a preview of GOP transportation priorities if Republicans flip the House in November.
| | | BUDGET DAY: The White House will release its budget request to Congress today, and we'll be keeping an eye on the numbers as they relate to DOT and DHS. Join us today at 3:30 p.m. as our policy reporters, including Morning Money author Kate Davidson, discuss the White House budget request and prospects for fiscal 2023.
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