Regulatory Developments

TSCA Reform:  House Subcommittee Holds Hearing on TSCA Modernization Act

April 14, 2015

On April 14, 2015, the House Energy and Commerce Subcommittee on Environment and the Economy held a hearing on the discussion draft of the TSCA Modernization Act of 2015 (TMA DD) introduced by Subcommittee Chair John Shimkus (R-IL) on April 7, 2015. As noted in our April 9, 2015, memorandum, "Shimkus Releases Discussion Draft of TSCA Reform Legislation," in the previous Congress, Shimkus introduced first a discussion draft of the Chemicals in Commerce Act (CICA1), and then a revised discussion draft of the bill, CICA2. In addition, Shimkus held "countless" hearings concerning reform of the Toxic Substances Control Act (TSCA). In his opening statement, Shimkus laid out an ambitious plan for proceeding with TMA DD. Shimkus plans to hold a markup in Subcommittee on TMA DD around May 14, 2015. Once the Subcommittee has completed its work, he will ask Committee Chair Fred Upton (R-MI) to schedule a full Committee hearing as soon as practicable. Subcommittee Ranking Member Paul Tonko (D-NY) expressed his appreciation for Shimkus' tone, friendship, and partnership. Tonko stated that TMA DD is a significant departure from the Udall-Vitter bill in the Senate (S. 697) and is different from CICA1 and CICA2. Upton noted that TMA DD is more focused than last year's bill, and commented that this is the year for meaningful TSCA reform. Committee Ranking Member Frank Pallone, Jr. (D-NJ) stated that TMA DD takes a thoughtful and innovative approach and has the potential to move chemical regulation forward. According to Pallone, while TMA DD does not attempt to reach the goal of a fully reformed TSCA, it will improve the current statute in several ways.

The Subcommittee heard testimony from the following witnesses:

  • The Honorable Jim Jones, Assistant Administrator, Office of Chemical Safety and Pollution Prevention, U.S. Environmental Protection Agency (EPA);
     
  • Michael P. Walls, Vice President of Regulatory and Technical Affairs, American Chemistry Council (ACC);
     
  • Dr. Beth Bosley, President, Boron Specialties, LLC (on behalf of the Society of Chemical Manufacturers and Affiliates);
     
  • Jennifer Thomas, Senior Director, Federal Government Affairs, Alliance of Automobile Manufacturers; and
     
  • Andy Igrejas, Director, Safer Chemical, Healthy Families.

Jones testified that, while the Obama Administration does not have a position on TMA DD, he would like to offer several observations. As stated in EPA's September 2009 Essential Principles for Reform of Chemicals Management Legislation, any TSCA reform bill should include improvements that would provide EPA the ability to make timely decisions if a chemical poses a risk and the ability to take action, as appropriate, to address that risk. Jones described a possible "catch-22" in TMA DD, which would require EPA to make a finding regarding the potential for risk prior to beginning the risk evaluation process. Jones also described the deadlines in TMA DD as "unreasonably short" in many cases, and expressed his willingness to discuss more realistic timelines. According to Jones, while TMA DD removes the least burdensome requirement under TSCA and appears to be consistent with the Obama Administration's principle that TSCA should reflect risk-based criteria protective of human health and the environment, it is ambiguous how EPA is to incorporate manufacturer and other costs into a risk management rule. In addition, TMA DD lacks a source of sustained funding.

During questioning, Jones described in more detail more specific issues with TMA DD. TMA DD would allow for manufacturers to request risk evaluations of specific chemicals, provided that the manufacturers pay for EPA's costs of conducting risk evaluation. TMA DD does not direct that these payments go to EPA, however. In addition, while Shimkus may have envisioned that manufacturers would provide all available data to EPA when requesting risk evaluations of specific chemicals, TMA DD does not include such language. Shimkus stated that the intent is for EPA to have access to information in conducting the risk evaluation and that he was open to revising the bill to allow that to happen. According to Jones, the issue of cost/benefit analysis is still unclear under TMA DD. Under the current unreasonable risk standard, EPA has to demonstrate that health benefits literally outweigh costs, but it is unclear whether TMA DD would require this. From EPA's perspective, there is a clarity issue. Tonko asked Jones whether requiring a minimum number of chemicals be reviewed would be helpful. Jones responded that if Congress wants EPA to maintain a certain pace, then that needs to be clear in the legislation. Tonko also addressed the issue of costs in assessment and management of risk. TMA DD includes explicit language intended to ensure costs are not considered in the unreasonable risk determination, but they are included in EPA's analysis of options available. When Tonko asked if Jones had any suggested changes that would make that change clearer, Jones stated that the Administration believes costs are an important consideration in risk management, but that it can be difficult to monetize benefits.

Jones identified several other areas needing clarification, including the definition of "weight of the scientific evidence," which might unduly lock EPA in. He also agreed that the draft gave EPA more effective testing authority by including order authority and by allowing EPA to require testing needed for Section 6 risk evaluations.

Walls testified that TMA DD addresses key TSCA reform issues. Areas that require clarification include the manufacturer-initiated risk evaluation process, where it is important that Congress clearly articulate its expectations; risk management rules; providing EPA access to appropriate resources, including directing TSCA fee revenue to EPA rather than the general treasury; and the ways states may depart from EPA regulations, if at all.

According to Bosley, the TMA DD safety standard corrects the fundamental flaw under TSCA that requires EPA to take costs into account. Bosley expressed support for EPA's current new chemicals program, which she stated works well. TMA DD does not include a prioritization scheme, which would allow EPA to go forward with its review of TSCA Work Plan chemicals. Bosley suggested that Congress consider adding language concerning processor reporting, which would improve EPA's understanding of actual exposures.

Thomas testified that the Alliance of Automobile Manufacturers supports TMA DD's regulation of articles and believes it is consistent with existing EPA policy. According to Thomas, article manufacturers face unique challenges and the Alliance supports an exemption of vehicle replacement parts. Vehicles are lasting longer, with a current average age of 11 years, and replacement part demand is small, declining over time. This would be a small universe of automobile parts.

Igrejas testified that the more targeted approach of TMA DD holds promise. The absence of a complicated prioritization scheme is wise, and EPA has already developed a prioritization scheme for TSCA Work Plan chemicals. TMA DD would preserve more of TSCA's preemption, make it easier for EPA to require testing, remove the least burdensome requirement, and protect vulnerable populations. TMA DD directs EPA to use weight of the evidence, which is a concept that the National Academies of Science have specifically rejected. Igrejas suggested that if Congress is going to address scientific policy, it should follow recommendations offered by the National Academies of Science.

Commentary

We note the irony that the House hearing on a possible TSCA compromise proposal was much more calm and civilized than the most recent Senate hearing covering the same ground. While the Senate hearing would have one believe that support for the bipartisan compromise would result in great harm to children and state governments, at least according to some witnesses, the House hearing was replete with bipartisan acknowledgement of the attempt to find middle ground. Though members and witnesses commented that some issues needed more work, the tone was generally positive, friendly, and at one point during a salute to bipartisan cooperation, a Democratic member of the panel asked the Chair (in jest) not to let others know they were making progress towards compromise.

Given the discussion at the House hearing, it is not yet clear why certain elements of the Senate bills are missing. Some witness testimony did suggest further modifications (for example, regarding deadlines, dedication of any fees to EPA, and clarification of the safety standard and risk assessment procedures). Various interest groups will stake out positions and make further suggestions, but the most striking element of the House hearing was calm rhetoric and generally genteel interaction among members and witnesses.

This generally bodes well for the possibility that there may yet be time and energy left among interested parties to move legislation successfully. At the same time, if today's hearing represents a significant increase in the chances of success, then we would urge a closer reading of the Shimkus draft since we find it to have significant elements missing or unclearly drafted as compared to both Senate bills on the same subjects. In our analysis of the Shimkus bill, we discussed how the various elements were either absent or unclear about how they would operationally address the current shortcomings of TSCA. These include:

  • The lack of any requirement for or guidance regarding EPA prioritization;
     
  • The requirement for an EPA "finding" in identifying chemicals for risk evaluation; and
     
  • The continued requirement for EPA to make "findings" under Section 4 to require testing.

Regarding the last, while TMA DD would give EPA authority to issue testing orders and to require testing needed to conduct a risk evaluation under Section 6, EPA would still have to satisfy the current TSCA findings to require testing for other purposes, such as for screening and identifying chemicals needing such an evaluation. In our view, the findings requirement has been one of the main reasons for the difficulties EPA has had in implementing the TSCA testing program and why EPA has required testing on only 200 chemicals. We would like to see this issue get more attention and note that one way to deal with this concern would be to require EPA, as is the case for new chemical actions under TSCA Section 5(e), to make determinations rather than to require legal findings. Such a change would retain the spirit of these requirements while lessening the burdens on EPA and thereby allowing it to obtain the testing needed to screen and sort through the many existing chemicals on the Inventory.

It was also surprising that the "hard" reset of the Inventory as proposed in TMA DD did not get more attention. While this point came up in written testimony from ACC, the issue was not identified during the hearing, which was somewhat surprising given the significance of the change being proposed.

Overall, however, the more genteel nature of the House hearing indicates there could be a real possibility of enactment. If the House Committee leadership has bipartisan sponsorship that carries over to any floor vote, it would increase the odds of most, if not all, of the Republican members of the Senate to support similar legislation. That, coupled with the Democratic Senators already on record as supporting compromise legislation, should provide a sufficiently large number of votes to overcome a possible filibuster threat on the Senate floor. Some would find such a scenario ironic with the Republican House majority leading the way for enhanced EPA regulatory authority and increased budgets for any kind of regulatory activity.


 
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