Regulatory Developments

House Subcommittee Holds Hearing on EPA’s FY 2020 Budget

April 10, 2019 PRINT

On April 9, 2019, the House Energy and Commerce Subcommittee on Environment and Climate Change held a hearing on the fiscal year (FY) 2020 budget for the U.S. Environmental Protection Agency. The April 5, 2019, memorandum from Representative Frank Pallone, Jr. (D-NJ), Chair of the Committee on Energy and Commerce, states that President Trump’s FY 2020 budget requests $6.068 billion for EPA, a $2.76 billion (31 percent) decrease from the level set in EPA’s FY 2019 Annualized Continuing Resolution. According to the memorandum, the budget cuts “would significantly hinder the agency from accomplishing several of its own identified goals.”

Regarding toxic substances, the memorandum notes that the Frank R. Lautenberg Chemical Safety for the 21st Century Act (Lautenberg Act) expanded EPA authority to collect fees from chemical manufacturers and processors to defray partially the costs of conducting risk evaluations under the Toxic Substances Control Act (TSCA). Fee collections are limited to 25 percent of EPA’s annual costs of administering TSCA activities, but are not to exceed $25 million per year. The President’s FY 2020 budget request includes $66.4 million for the TSCA Chemical Risk Review and Reduction Program, an increase of $5.31 million from the FY 2019 enacted level. On September 27, 2018, EPA promulgated a final rule pursuant to the Lautenberg Act to collect fees from chemical manufacturers and processors to support TSCA activities. According to the memorandum, since the rule went into effect in October 2018, EPA has collected $1.3 million in user fees to supplement federal appropriations to defray the cost of TSCA implementation. More information on the final fees rule is available in our September 28, 2018, memorandum, “EPA Issues Final TSCA Fees Rule.”

At the hearing, EPA Administrator Andrew Wheeler was joined by Holly Greaves, EPA’s Chief Financial Officer. After Wheeler provided his testimony regarding EPA’s proposed FY 2020 budget, Representative Paul Tonko (D-NY), Chair of the Subcommittee, began the questioning. Tonko noted that before being confirmed as EPA Administrator, Wheeler sent a letter to Senator Thomas Carper (D-DE) in which he committed to submitting EPA’s systematic review method for TSCA risk evaluations to the National Academy of Sciences (NAS) for review and to make public any feedback received. Tonko asked Wheeler what the status of this submission is, and Wheeler responded that he believes that EPA has submitted some of the data for the first ten chemicals but that those risk evaluations are not supposed to be finished before the end of 2019. Tonko questioned whether NAS will have complete discretion in its review of EPA’s systematic review method, and Wheeler stated that his understanding is that EPA cannot dictate how NAS conducts its reviews. Tonko also asked about the status of the Integrated Risk Information System (IRIS) assessment for formaldehyde. Wheeler responded that the work done on formaldehyde under the IRIS Program will inform the risk evaluation under TSCA; and because EPA can regulate a chemical under TSCA but cannot under the IRIS Program, EPA chose to proceed to evaluate formaldehyde under TSCA. When Tonko asked when the IRIS assessment will be released, Wheeler responded that EPA is not moving forward with the formaldehyde assessment under the IRIS Program.

Representative John Shimkus (R-IL), Ranking Member of the Subcommittee, asked Wheeler about the backlog of premanufacture notices (PMN) awaiting review. Shimkus noted that TSCA specifically mandates completion of new chemical reviews within 90 days, but no more than 180 days. Of 527 pending PMNs, according to EPA’s website, Shimkus asked how many were older than 180 days. Wheeler responded that currently 270 PMNs are older than 180 days, which is lower than it was. According to Wheeler, EPA is working to reduce the backlog and is processing PMNs more quickly than a year ago. Shimkus asked how many PMNs are older than 90 days, and Wheeler responded that 110 to 120 PMNs are over 90 days but less than 180 days old. When asked whether the backlog is an EPA labor or a legal problem, Wheeler responded that it is more a labor problem. EPA has had to work through the program and how the program would be implemented; during the implementation phase, the backlog developed. EPA is trying to process new PMNs as quickly as possible while also working on the backlog. According to Wheeler, EPA has a plan to reduce the backlog of old PMNs that have been “languishing” for months or years. Wheeler reiterated that it is in part a staffing problem. While EPA hired 25 new people last year to work on TSCA, at the same time it lost 25 people. Shimkus asked whether EPA would try to place quickly more experienced scientists and engineers in the TSCA Program to complete more timely new chemical reviews and risk evaluations, and Wheeler said yes.

Pallone expressed concern about EPA’s direction, noting particularly EPA’s decision to ignore legacy uses of asbestos and stating that it is “unconscionable” that the U.S. is still importing and using asbestos. When Pallone asked Wheeler if he would commit to banning ongoing uses of asbestos (“yes” or “no”), Wheeler stated “yes” but Pallone continued before Wheeler could expand his point. Pallone noted that while former EPA Administrator Scott Pruitt had committed to banning methylene chloride, under Wheeler, EPA is moving forward with only a partial ban that would still allow commercial uses. Wheeler responded that EPA is currently taking comment on several options to manage the commercial use of methylene chloride. More information on EPA’s methylene chloride rulemakings is available in our March 20, 2019, memorandum, “EPA Bans Consumer Sales of Methylene Chloride Paint Removers, Seeks Comment on Program for Commercial Uses.”

Finally, Pallone addressed what he considers EPA’s overly broad interpretation of confidential business information (CBI). Pallone asked Wheeler about the studies withheld when EPA released its risk evaluation of Colour Index (C.I.) Pigment Violet 29 and, once EPA finally released the studies, the main data tables that were redacted. Wheeler responded that the redacted tables are CBI and cannot be released. Pallone also asked about the notice of violation (NOV) report regarding TSCA violations by the Chemours Company (Chemours) at two facilities. Pallone noted that the NOV and report are significantly redacted, and that the disclosure even of generic chemical information would be helpful for the community. Pallone stated that he thinks EPA exceeds what is required by law to be redacted and asked Wheeler if he would commit to sharing the unredacted NOV report. Wheeler responded that EPA has to safeguard CBI and that it has directed Chemours to test hundreds of water supplies within the areas of the two facilities.

Regarding the reorganization of EPA’s regional offices, Representative David McKinley (R-WV) asked Wheeler what EPA’s objective is and what the metrics are. Wheeler stated that the reorganization of the regional offices will take effect on April 15, 2019. According to Wheeler, the biggest change is that six regions had enforcement divisions while the enforcement programs for four regions were scattered among the program offices. The reorganization will realign all regions to mirror EPA headquarters, allowing the headquarters’ enforcement office to work more closely with the regional enforcement offices.

Representative Bill Johnson (R-OH) noted that he helped get language added to the Lautenberg Act that amended TSCA Section 8 to require a negotiated rulemaking between EPA and regulated stakeholders to reduce duplicate reporting of unintended byproducts. According to Johnson, unfortunately the legal and procedural venues were not conducive to producing a satisfactory result. Johnson stated that he understands EPA is close to proposing a rulemaking under TSCA Section 8 and asked Wheeler whether that rulemaking will address duplicate reporting. Wheeler stated that he believes that it will but will have to get back to Johnson with the details.

Commentary

The hearing was marked by Majority expressions of doubt regarding EPA’s budget request as well as statements questioning EPA’s commitment to protecting health and the environment and its willingness to uphold statutes as written or at least as interpreted by the questioners. There were also questions noting Wheeler’s and other EPA officials’ prior work as lobbyists and possible favoritism. Representative Shimkus responded by warning against such “innuendo.” Exchanges such as these and others highlighted the palpable tension amongst the Subcommittee’s leadership.

The hearing did not yield much new information but it did produce some clarity regarding the counts of overdue and delayed PMN reviews. EPA also offered statements regarding a plan and staffing to reduce the backlog of delayed and “old” PMNs, but specifics were not provided. Perhaps more will be forthcoming in EPA’s written responses.


 
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