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House Approves Chemical Reform Legislation

The House of Representatives on 24 May overwhelmingly approved chemical reform legislation described by the Energy and Commerce Committee as “a landmark bicameral, bipartisan overhaul of our chemical safety standards.” Originally introduced on 10 March 2015 by Sens. Tom Udall (Democrat-New Mexico) and David Vitter (Republican-Louisiana), the most recent version of the Frank R. Lautenberg Chemical Safety for the 21st Century Act (H.R. 2576) is the product of many months of bi-partisan House and Senate negotiations that sought to resolve a number of differences between the two versions of the legislation. H.R. 2576 is expected to be green-lighted by the Senate and signed into law by President Obama within the next few weeks, effecting the first significant overhaul of the Toxic Substances Control Act since its enactment nearly 40 years ago.

According to a fact sheet issued by the Energy and Commerce Committee, H.R. 2576 would do the following.

  • provide the Environmental Protection Agency the tools to ensure chemicals in commerce are safer for consumers
  • create a new system for the EPA to evaluate and manage risks associated with chemicals already on the market: either the EPA or a manufacturer (who is willing to pay the cost) may designate a chemical for risk evaluation, the risk evaluation must stand up to rigorous scientific standards set out in the legislation, and if unreasonable risk is determined the EPA must immediately draft a rule to manage such risk
  • set deadlines for the EPA to take action by requiring risk evaluations to be completed within three years and risk management rules to follow completion of risk evaluations by 90 days
  • ensure user fees paid to the EPA are used for chemical management activity (user fees will be deposited in a separate fund in the Treasury and the fees charged and collected will match the cost of carrying out the specific purposes)
  • provide limited pre-emption of state law (once the EPA makes a final decision on whether a chemical poses an unreasonable risk, EPA action would generally apply in all states but prior state laws and private rights of action under tort or contract law will be preserved)
  • maintain protection of confidential business information (certain state, local and tribal government officials and health care professionals will now have access and confidentiality claims must be reclaimed after ten years)

The first step to deciding whether regulation of a chemical is warranted under the new regulatory framework would be a scientific evaluation of the risk posed by the chemical, looking at its hazards and exposures without considering cost or other non-risk factors. If that analysis indicates that the use of the chemical presents an unreasonable risk, including to a vulnerable or susceptible population, the EPA would then pursue a rulemaking to manage the risk that could range from minimum labelling or notice requirements to an outright ban. In choosing regulatory options the EPA must consider the effects of the chemical on health and the environment, the chemical’s benefits, and economic consequences of the regulation including effects on the national economy, small businesses and technology innovation. The considerations and the cost and benefits of the rule and cost effectiveness of the regulation must, to the extent practicable, also be factored in.

When deciding whether to ban or restrict a chemical, the EPA would have to consider the availability of feasible alternatives. Unless they contribute significantly to the risk, replacement parts for certain complex durable and electronic goods that are designed prior to the risk management rule would be exempt from a ban or restrictions. Articles may be restricted only to the extent necessary to address risk from exposure to that article. Critical uses of a chemical may be exempt from restriction if there is no safer alternative, the restriction would disrupt the economy, national security or critical infrastructure, or the chemical provides a substantial benefit to health, safety or the environment.

The compromise text contains the key elements of the Senate-passed bill. The EPA would be required to review and make an affirmative finding about the level of risk posed by a new chemical without regard to cost. The chemical may not be commercially produced until the EPA rules on it and the chemical cannot be produced without being in compliance with applicable EPA restrictions that are without regard to cost. The compromise text also attempts to tighten the timeline for the EPA to take action, requiring the agency to make a determination about and choose a necessary regulatory option for a chemical within 90 days but no later than 180 days if more time is needed.

In addition, H.R. 2576 gives the EPA four determinations from which to choose regarding whether a new chemical or new use: (i) presents an unreasonable risk (in which case the EPA must immediately take regulatory action under current law sub-section (f)); (ii) may present an unreasonable risk, is made in large quantities, or there is not enough information to make a determination (which would trigger order requirements under sub-section (e)); (iii) is likely not to present a risk under the conditions of use (in which case manufacture may begin); or (iv) is a low hazard and manufacture may begin.

H.R. 2576 maintains existing TSCA chemical testing provisions but specifies key points in the evaluation and regulatory process where the EPA may order testing (e.g. prioritisation for risk evaluation and the risk evaluation itself). In addition, the legislation reduces animal testing required under TSCA and allows fees collected under one provision to be used to work on the same chemical under testing, evaluation, and regulation and information protection provisions. The bill caps overall fee collection (with some exceptions) to 25 percent of EPA’s cost for regulating new and existing chemicals and test orders or US$25 million, whichever is lower, and requires manufacturers who request risk evaluations of their chemicals to pay the full cost of the evaluation and regulation.

The House-Senate compromise approach to chemical reform has generally been well received, although a number of environmental groups believe the reworked version of the Frank R. Lautenberg Chemical Safety for the 21st Century Act still fails to adequately protect consumers from hazardous chemicals. For example, the Environmental Working Group argues that H.R. 2576 “would continue to tie the hands of the states by suspending state action while the EPA studies a chemical’s safety,” does not require adequate funding from the chemical industry and fails to fully eliminate cost from the EPA’s consideration of how to regulate a chemical. The Natural Resources Defense Council believes that while the new bill will give the EPA “a clear and enforceable mandate to review chemicals” it also contains “loopholes and rollbacks sought by the chemical industry, including restricting the authority of states, and limiting the EPA from monitoring chemicals in imported products that may be a threat to public health.”

Meanwhile, environmental officials from six U.S. states – Washington, Connecticut, New York, Minnesota, New Hampshire and Vermont – recently issued a statement expressing concern about the pre-emption provisions of H.R. 2576. The officials stated that while “there are good elements in the legislation” state authorities are “excessively and unnecessarily preempted, in exchange for the promise of federal protection that is too meager.”

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