Udall-Vitter TSCA Reform Bill Builds Momentum for Passage; Senato

Mark N. Duvall

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Udall-Vitter TSCA Reform Bill Builds Momentum for Passage; Senators Boxer, Markey Respond with Competing Legislation

by: Mark N. Duvall of Beveridge & Diamond PC - Environmental Law Portal

Wednesday, April 1, 2015

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On March 10, 2015, Senators Tom Udall (D-N.M.) and David Vitter (R-La.) introduced the Frank R. Lautenberg Chemical Safety for the 21st Century Act (S. 697),^[1] to modernize the Toxic Substances Control Act (TSCA). This bipartisan “Udall-Vitter” bill, which as introduced had eight Democratic and nine Republican sponsors and co-sponsors, likely marks a turning point in the long history of efforts to amend TSCA. It is off to a quick start, with a hearing held on March 18 before the Senate Environment and Public Works Committee.^[2] However, it already faces a challenge in the form of a competing bill, the Alan Reinstein and Trevor Schaefer Toxic Chemical Protection Act (S. 725), introduced by Senators Barbara Boxer (D-Calif.) and Ed Markey (D-Mass.), although with no Republican co-sponsors.^[3] The “Boxer-Markey” bill features provisions from earlier Democratic bills that had attracted no Republican support. As explained in this alert, the Boxer-Markey bill and the Udall-Vitter bill overlap substantially. But the two bills diverge on several hot button issues, including preemption of state restrictions on chemicals, the safety standard, and regulation of legacy chemicals such as asbestos.

Background

TSCA is the primary federal law for regulating chemicals. It authorizes EPA to regulate chemicals in a variety of ways, including by requiring manufacturers and/or processors to test chemicals; to report information about chemicals; to notify EPA before manufacturing chemicals not on the TSCA Inventory or before manufacturing or processing them for a significant new use; and to comply with chemical restrictions. Adopted in 1976 and not substantively revised since then, TSCA is widely considered to be outdated and ineffective. Critics charge that EPA has not accomplished much under TSCA during the nearly 40 years since its enactment. EPA has found the testing requirement cumbersome; the risk management provision unworkable; and the lack of a driver for it to review chemicals systematically an impediment. TSCA reform legislation was introduced in 2005, 2008, 2010, 2012, 2013, and 2014. [4] Although none of these bills was passed by either House of Congress, substantial progress has been made on agreements about the nature of the solutions needed to make TSCA more effective while protecting innovation and a national economy.

The Udall-Vitter and Boxer-Markey bills build on this progress. Most notably, both are based on a bipartisan bill originally introduced in 2013 by Senator Frank Lautenberg and Senator Vitter, the Chemical Safety Improvement Act (CSIA). Senator Lautenberg died 12 days after its introduction, and thereafter Senator Udall joined Senator Vitter in revising the CSIA to address objections to particular provisions. Their draft revision was leaked in September 2014. [5] These two new bills make changes to that draft revision, although the changes go in different directions, as explained below. Both bills would streamline the process by which EPA could require testing. Both would direct EPA to prioritize chemicals found to be in active commerce for detailed review in a safety assessment (essentially a risk assessment). Both would then require EPA to determine in a safety determination whether reviewed chemicals meet or do not meet a safety standard under the conditions of use. Those found not to meet the safety standard would become the subject of risk management measures intended to make the chemical meet the safety standard under the conditions of use. Both would protect confidential information, while requiring health and safety studies to be made available to the public.

Key Provisions of the 2015 Udall-Vitter Bill

1. Safety Standard

The Udall-Vitter bill’s safety standard would guide EPA in determining whether to take further action to regulate a particular chemical. The heavily negotiated provision would define the safety standard as one where “no unreasonable risk of harm to health or the environment will result from exposure to a chemical substance” under the “conditions of use.” The phrase “conditions of use” would be defined to mean “the intended, known, or reasonably foreseeable circumstances the Administrator determines a chemical substance is manufactured, processed, distributed in commerce, used, or disposed of.” A key change from current TSCA would be that the determination of whether a chemical meets the safety standard under the conditions of use would be made “without taking into consideration cost or other non-risk factors.”

2. State Preemption

The 2014 Udall-Vitter draft bill did not revise the CSIA’s preemption provision, but both Senators Udall and Vitter acknowledged last fall that such a change was needed. The 2015 Udall-Vitter bill makes a number of modifications to the CSIA’s preemption provision. The March 18 hearing indicated that disputes about preemption are likely to be the biggest obstacle to passage.

Like the CSIA, S. 697 would provide for limited preemption of state restrictions prior to EPA adopting risk management measures. The scope of that preemption would be narrower in the new bill, however. Unlike the CSIA, it would not provide for preemption of new state restrictions upon designation of a chemical as a low priority for a safety assessment or determination. The CSIA provision basing preemption on a low-priority designation had attracted more criticism than any other aspect of that bill.

For high-priority substances, the bill would tie preemption of new state prohibitions or restrictions to the scope of EPA’s safety assessment and safety determination. Under the new language, EPA would be required to define the scope of its safety assessment and determination within six months of a high-priority designation.

If EPA were to determine that a chemical met the safety standard, new and existing state laws that impose prohibitions or restrictions within the scope of the safety assessment and determination would be preempted as of the date of the safety determination. If instead EPA were to determine that the chemical did not meet the safety standard, new and existing state prohibitions or restrictions within the scope of the safety assessment and determination would be preempted as of the effective date of the subsequent risk management rule.

The Udall-Vitter bill’s preemption provision also differs from that of the CSIA in that it would grandfather all state restrictions in effect on January 1, 2015. Several state attorneys general had argued that their state restrictions should be preserved. The 2014 Udall-Vitter draft bill would have created an exception for California’s Proposition 65 only; the 2015 bill would substantially broaden that exception.

Two aspects of the Udall-Vitter preemption provision came under particular attack during the March 18 hearing. One was preemption of new state restrictions before EPA either enacted federal restrictions or decided that no federal restrictions were necessary. The other was that the bill has no exclusion from preemption for state restrictions that are identical to federal restrictions. Such an exclusion is a common feature of many federal product regulatory statutes so as to “put more cops on the beat,” as was repeatedly stated at the hearing.

3. Fees

The Udall-Vitter bill would authorize EPA to assess fees for certain activities and require that the fees be set so as to cover approximately 25 percent of the costs of administering the covered activities. Collectively, the fees would be capped at $18 million and would “reflect an appropriate balance” between manufacturers and processors. The following activities would be subject to potential fees:

Submitting a PMN, SNUN, or low volume exemption application for a chemical;
Notifying EPA that a chemical is active, or that a previously inactive chemical is now active;
Submitting a section 8(a) report for a chemical; and,
Manufacturing or processing a chemical that is the subject of a safety assessment and safety determination.

The fees would go to a special fund in the Treasury, rather than to general revenues as under the current TSCA fee provision. No fees could be assessed if Congressional appropriations for TSCA administration fell below those approved for fiscal year 2015, providing a disincentive for Congress to reduce appropriations. EPA’s handling of fees would be audited annually by the EPA Inspector General’s office. In addition, EPA would have to consult with persons potentially subject to fees every three years to consider readjusting the fee amounts. This is similar to the procedure for setting fees for pesticides, prescription drugs, and medical devices, except new fees would be set through EPA rulemaking rather than through legislation.

4. Articles

The bill would limit EPA in applying any requirement for chemicals in articles. If EPA intended “to prohibit or otherwise restrict an article on the basis of a chemical substance contained in that article,” it would need to have “evidence of significant exposure to the chemical substance from such article.” At the hearing, EPA Assistant Administrator Jim Jones expressed concern about this provision.

5. Prioritization

The Udall-Vitter bill would set new requirements and deadlines for prioritization of chemicals. Within 180 days of the enactment of the bill, EPA would need to consider and publish an initial list of 10 high-priority substances and 10 low-priority substances. At least 5 of the initial high-priority substances would have to be drawn from the October 2014 TSCA Work Plan and subsequent updates. At least 50% of future high-priority substances would be drawn from the TSCA Work Plan until all such chemicals are prioritized. These new provisions come in response to requests for more immediate action on persistent bioaccumulative and toxic (PBT) chemicals, which are included in the TSCA Work Plan.

Following the initial prioritization of chemicals, EPA would be required to continue to designate high- and low-priority substances. After three years, EPA would need to add additional substances to ensure 20 high-priority substances had undergone or were undergoing safety assessments and determinations and to ensure that 20 low-priority substances had been designated. Within five years, EPA would need to ensure that 25 high- and 25-low priority substances had been addressed.

6. New Chemicals and SNURs

The TSCA regulatory scheme for new chemicals and significant new uses has been largely preserved under the Udall-Vitter bill. The bill would make one significant change, however. It would require EPA to make an affirmative determination that a chemical or significant new use is likely to meet the safety standard, rather than merely allow the applicable review period to expire, in order for production of the chemical or manufacture or processing for the significant new use to begin. If EPA were to determine instead that the chemical or significant new use would not be likely to meet the safety standard, risk management would be required.

Comparison of the Udall-Vitter Bill and the Boxer-Markey Bill

1. Common Requirements

Because the Udall-Vitter bill and the Boxer-Markey bill both work off of the 2014 Udall-Vitter draft bill, most of their provisions are substantially similar. Some of the more notable commonalities include:

Testing: Both bills would authorize EPA to require the development of new information by rule, consent agreement, or order, but only if EPA were able to show that such testing is needed. Neither bill would impose minimum data set requirements.
Active Chemicals: Both bills would require reporting by manufacturers and processors to identify active chemicals. Both would obligate EPA to review all active chemicals on a prioritized basis and regulate those chemicals as appropriate.
Prioritization Actions: Both bills would allow for three distinct prioritization results for active chemicals: the designation of a chemical as high-priority, the designation of a chemical as low-priority, and the determination that more information is needed to prioritize the chemical.
Safety Assessment/Determination Basics: Under both bills, the safety assessment would have to be conducted without consideration of costs and benefits, and the safety determination would have to be made with reference to the safety standard. Risk management alternatives would be available through rulemaking to ban a chemical or ensure that it meets the safety standard.
New Chemicals and Significant New Uses: Neither bill departs significantly from the current approach to regulating new chemicals and significant new uses under TSCA, although both would require EPA to affirmatively determine whether the chemical or new use is likely to meet the safety standard.
CBI: Confidential business information (CBI) would be protected under both bills in the same ways. Both would require substantiation of a CBI claim and would preserve the claim for a period of 10 years, subject to renewal.
Use of Science: Both bills would require EPA to consider the best available science. In addition, the Udall-Vitter bill would require EPA to consider the weight of the scientific evidence.
Imports: Under both bills, if EPA were to issue a ban for a chemical, that chemical could not be imported. In addition, as under current law, if the chemical is not on the TSCA Inventory and is not exempt from inclusion on the Inventory, entry of the chemical would be prohibited.
Exports: The export of a chemical would not be permitted under either bill if EPA were to determine that the chemical is not likely to meet the safety standard (under section 5) or does not meet the safety standard (under section 6). Both bills would require export notification where required under a treaty.
Fee Provision: Both bills would authorize EPA to require, by rule, manufacturers of chemical substances to pay reasonable fees to support EPA’s administration of the safe chemicals program.

2. Major Differences

Distinctions between the bills include:

Safety Standard: While the Udall-Vitter bill would set an “unreasonable risk of harm” standard, the Boxer-Markey bill would adopt a standard that aims to ensure “with reasonable certainty . . . that no harm to human health or the environment will result from” chemical exposure.
Preemption: As described above, the Udall-Vitter bill contains preemption provisions that would restrict state action based on the scope of EPA’s safety determination and assessment. The Boxer-Markey bill would do away with preemption altogether; State regulation of chemicals would not be limited by EPA activity.
Fees: The Boxer-Markey bill would authorize fees for testing, developing the priority list, conducting safety assessments and determinations, adopting risk management rules, reviewing PMNs or SNUNs, reporting for CDR or active substances, and reviewing CBI claims. The fees would be set at a level sufficient to fully cover the costs of administrating these activities, whereas, under the Udall-Vitter bill, only 25% of TSCA administration would be covered. The Boxer-Markey bill would not set a ceiling for fees.
Pace of Prioritization: The Boxer-Markey bill would set a more ambitious timeline for prioritization than would the Udall-Vitter bill. Within the first six months of the law’s enactment, EPA would have to publish an initial list of at least 15 high-priority chemical substances. After one year, EPA would have to begin adding at least 15 high-priority substances to the list on an annual basis for four years. For each substance removed from the list, at least one additional chemical would have to be added. Once fees are in place, three substances would have to be added for every one removed.
Safety Assessment/Determination Scope and Deadlines: The Boxer-Markey bill does not include a provision requiring EPA to determine the scope of safety assessments and determinations. In addition, the Boxer-Markey bill would require EPA to complete a safety assessment and determination for a chemical not later than two (as opposed to three) years after the chemical is designated as a high-priority (both bills include a two-year slippage provision).
Articles: The Boxer-Markey bill does not include a provision requiring EPA to provide evidence of significant exposure to a chemical from an article in order to prohibit or restrict that article, as would the Udall-Vitter bill. Both bills allow EPA to require import certification for chemicals in articles, but the Udall-Vitter bill would require EPA to identify the types of articles that would be subject to the certification requirement. The two bills also have different factors that must be considered in determining the need for a certification rule. For example, the Udall-Vitter bill would include a factor on impacts to commerce that the Boxer-Markey bill omits.
Standard for Review: The Udall-Vitter bill would continue to provide, as does current TSCA, that key EPA actions are subject to judicial review under a heightened “substantial evidence” standard. In contrast, the Boxer-Markey bill would replace that standard with the more common “arbitrary or capricious” standard of the Administrative Procedure Act.
PBTs: Unlike the Udall-Vitter bill, the Boxer-Markey bill would require expedited action for PBTs. Within 180 days, EPA would have to prepare a comprehensive list of PBTs. No later than 60 days after this list is published, manufacturers and processors would have to submit any additional information necessary to assess these PBTs. Within one year after receiving this additional information, EPA would have to identify and assess conditions of use and exposure to the listed PBTs. Within two years, it would have to issue rules to restrict PBTs to achieve the maximum possible reduction in exposure. These rules may be effective upon proposal.
Asbestos: The Boxer-Markey bill would require that all forms of asbestos be listed as one high-priority chemical substance. Within two years of enactment, EPA would have to complete a safety assessment and determination for asbestos. Within three years of the enactment of the law, EPA would have to issue a final asbestos risk management rule. The Udall-Vitter bill does not include asbestos-specific requirements.
Disease Clusters: The Boxer-Markey bill would add an entirely new title called “Strengthening Protections for Children and Communities from Disease Clusters.” The term “disease cluster” would be defined to mean “the occurrence of a greater-than-expected number of cases of a particular diseases within a group of individuals, a geographical area, or a period of time.” The bill would set forth guidelines and provide enhanced support for the investigation of disease clusters. The bill would also authorize technical assistance grants to individuals or groups affected by a disease cluster.