By Lynn L. Bergeson and Carla N. Hutton
As reported in our May 29, 2020, blog item, on May 28, 2020, the U.S. Environmental Protection Agency (EPA) Office of Inspector General (OIG) issued a report entitled EPA Toxic Substances Control Act Consent Orders Need Better Coordination. OIG conducted the evaluation to determine what actions EPA took to verify compliance with the requirements of a 2009 Toxic Substances Control Act (TSCA) Premanufacture Notice Consent Order. OIG’s recommendations included that EPA implement a process for the Office of Enforcement and Compliance Assurance (OECA) to review and approve the terms and conditions of TSCA Section 5(e) Consent Orders that it is responsible for verifying during compliance monitoring and enforcement activities. On August 5, 2020, OIG announced that EPA has provided an update to its response to the OIG report. EPA states that the Office of Civil Enforcement/Waste and Chemical Enforcement Division (OECA/WCED) and the Office of Pollution Prevention and Toxics/Chemical Control Division (OCSPP/CCD) have developed a TSCA Section 5(e) Order Boilerplate that “clarifies and strengthens the provisions of the Order for New Chemical Substances.” According to EPA, in 2020, OCSPP/CCD and OECA/WCED established and implemented a Standard Operating Procedure (SOP) to ensure that WCED, the office responsible for compliance monitoring and enforcement activities, reviews and approves the terms and conditions of TSCA Section 5(e) Orders developed by CCD. EPA notes that the establishment of the SOP is intended to meet OIG’s recommendation. EPA states that the Review and Approval Protocol “provides sufficient assurance that compliance and enforcement requirements in TSCA 5(e) orders will be reviewed and approved by OCSPP and OECA.” OIG commented on EPA’s updated response, stating that it now considers this recommendation complete.
By Lynn L. Bergeson and Carla N. Hutton
The National Academies of Sciences, Engineering, and Medicine (NASEM) are now assembling an ad hoc committee to identify emerging scientific and technological advances from across a broad range of disciplines that the U.S. Environmental Protection Agency’s (EPA) Office of Research and Development (ORD) should consider in its research planning to support EPA’s mission for protecting human health and the environment. In addition, according to NASEM, the committee will recommend how ORD could best take advantage of those advances to meet current and future challenges during the next 10 - 20 years. NASEM states that the committee will consider EPA’s mission, strategic planning documents, and current initiatives, as well as other broader topics, including, but not limited to, biotechnology, big data, climate impacts, environmental monitoring and sensors, impacts of stressors on ecological and human health, and artificial intelligence and machine learning. The committee also will consider advances that help EPA better incorporate systems thinking into multimedia, multidisciplinary approaches.
The study will be carried out by a committee of approximately 16 volunteer experts from a wide range of disciplines that can be applied to current and emerging environmental challenges facing society, including:
- Physical, chemical, biological, environmental, and social sciences;
- Exposure science;
- Public health;
- Aquatic and terrestrial ecosystems;
- Informatics/information technology;
- Risk assessment;
- Risk management;
- Environmental policy decision-making;
- Communication and application of scientific information in environmental decision-making; and
- Emerging science and technology.
Nominations for committee members and reviewers are due August 5, 2020.
By Lynn L. Bergeson and Carla N. Hutton
On May 28, 2020, the U.S. Environmental Protection Agency (EPA) Office of Inspector General (OIG) issued a report entitled EPA Toxic Substances Control Act Consent Orders Need Better Coordination. OIG conducted the evaluation to determine what actions EPA took to verify compliance with the requirements of the 2009 Toxic Substances Control Act (TSCA) Premanufacture Notice Consent Order with DuPont (responsibilities transferred to The Chemours Company in 2015) to prevent the release of GenX chemicals in the Cape Fear River in North Carolina. OIG notes that GenX chemicals are a type of per- and polyfluoroalkyl substances (PFAS) found in surface water, groundwater, drinking water, rain water, and air emissions. OIG found insufficient communication and coordination between the two EPA offices responsible for developing and enforcing the consent order requirements designed to reduce risks in the manufacture of GenX chemicals. Under the 2009 Consent Order, EPA required DuPont to determine how to recover and capture 99 percent of GenX’s manufacturing discharges and air emissions. The Consent Order was not reviewed or approved by the Office of Enforcement and Compliance Assurance (OECA), which is responsible for conducting inspections to verify compliance, however. Until June 2017, EPA’s actions to verify compliance with the 2009 Consent Order and new chemicals testing requirements consisted of tracking and reviewing information provided by the manufacturer. According to OIG, following the local media coverage of the presence of GenX chemicals in the Cape Fear River in 2017, Region 4 and EPA contractors conducted EPA’s first on-site compliance monitoring inspection at the Fayetteville Works facility, which manufactures GenX. OIG found that the Region 4 inspectors were unaware of the 2009 Consent Order and its requirements until the inspection was requested by EPA headquarters.
OIG recommends that EPA establish and implement processes:
- For OECA to review and approve the terms and conditions of TSCA Section 5(e) Consent Orders that it is responsible for verifying during compliance monitoring and enforcement activities; and
- To provide final TSCA Section 5(e) Consent Orders to regions and verify that the regions have the final consent orders.
OIG states that EPA “did not provide an acceptable corrective action for Recommendation 1, and we consider this recommendation unresolved.” For Recommendation 2, EPA provided an alternative course of action that OIG finds acceptable. OIG considers Recommendation 2 resolved with corrective action pending.
By Lynn L. Bergeson and Carla N. Hutton
On May 12, 2020, the U.S. Environmental Protection Agency (EPA) released the signed final rule updating the definition of small manufacturers, including a new definition of what is considered a small government, used to determine reporting and recordkeeping requirements under the Toxic Substances Control Act (TSCA). According to EPA, the updated definitions will reduce reporting burdens on chemical manufacturers and small governments while maintaining the agency’s ability to receive the information it needs to understand exposure to chemical substances manufactured in the United States. The final rule makes a technical correction to the small manufacturer reference at 40 C.F.R. Section 704.104 for hexafluoropropylene oxide, which only includes a rule-specific small processor definition and not a small manufacturer definition. When reviewing the small manufacturer size standards, EPA found this to be an “inadvertent error.” The final rule also updates the current small manufacturer definition in the Preliminary Assessment Information Rule (PAIR) at 40 C.F.R. Section 712.25 to align it with the updated small manufacturer definition at 40 C.F.R. Section 704.3.
EPA notes that the updated definitions will apply to the Chemical Data Reporting (CDR) rule reporting period beginning June 1, 2020, and will impact certain reporting and recordkeeping requirements for TSCA Section 8(a) rules. EPA states that the final rule is based on 2018 dollars to ensure that the definition is as up to date as possible at the time of promulgation. The final rule will be effective 30 days after publication in the Federal Register. EPA has posted the pre-publication version of the final rule on its website.
More information on CDR reporting is available in our May 13, 2020, blog item, “New Reporting Procedure for Co-Manufacturers under TSCA CDR Rule May Catch Certain Manufacturers Off Guard,” and our March 19, 2020, memorandum, “EPA Releases Final Amendments to CDR Rule, Extends Reporting Period.”
By Lynn L. Bergeson, Charles M. Auer, Richard E. Engler, Ph.D., and Carla N. Hutton
On April 5, 2019, the U.S. Environmental Protection Agency (EPA) issued a final rule that will establish final significant new use rules (SNUR) under the Toxic Substances Control Act (TSCA) for 13 chemical substances that are the subject of premanufacture notices (PMN). 84 Fed. Reg. 13531. The final rule is significant because the 13 chemical substances are not also subject to consent orders. During the review, EPA identified certain reasonably foreseen conditions of use that it designated as significant new uses in the final SNURs. The final SNURs effectively prohibit the designated new use unless a person submits a notice to EPA, EPA makes a determination, and it takes any necessary action to mitigate any identified potential risk. The final rule will become effective on June 4, 2019. Please see our full memorandum for more information on this final rule.
By Lynn L. Bergeson and Margaret R. Graham
The U.S. Small Business Administration’s (SBA) Office of Advocacy (Advocacy) has announced that it will be hosting regional small business roundtables “to hear firsthand from small businesses facing regulatory burdens [on] … which federal agency regulations should be considered for reform or elimination,” and “which regulations are problematic for your business,” as a result of the recent Executive Orders 13771 and 13777 on regulatory reform.
The first two roundtables in this series will be held on June 7, 2017, and June 8, 2017, in Baton Rouge and New Orleans, Louisiana, respectively. Several more are expected to be scheduled soon for Boise, Idaho, Phoenix, Arizona, and St. Louis, Missouri, among others.
The Advocacy website states that the purpose of regional regulatory roundtables is to:
- Identify regional small business regulatory issues in order to assist agencies with regulatory reform and reduction in compliance with Executive Orders 13771 & 13777;
- Compile crucial information for Advocacy’s new report on existing small business regulatory burdens across the nation, identifying specific recommendations for regulatory changes based upon first-hand accounts from small businesses across the country; and
- Inform and educate the small business public as to how Advocacy and SBA can assist them with their small business.
Registration for the first two roundtables is available online: Baton Rouge registration; New Orleans registration. Advocacy is also accepting comments regarding regulatory reform via an online form. More information on the Executive Orders and their implementation is available on our blog.
By Christopher R. Bryant and Lynn L. Bergeson
A trio of recent internal U.S. Environmental Protection Agency (EPA) memoranda are providing insight into how EPA intends to implement President Trump’s review and potential pogrom of EPA regulations. Virtually no program or regulation appears to be secure from the chopping block. Many stakeholders in industry and other sectors may be alarmed to see programs that are of benefit to them assigned a slot in the guillotine. Supporters of these programs, thus, would be wise to educate senior EPA officials to help them understand the benefits of those programs or regulations, and save them from elimination. These internal memoranda demonstrate that the regulatory dismantling of EPA’s programs is being robustly carried out by EPA. Those stakeholders who wish to save a program benefitting their interests should act immediately to educate EPA. The three memoranda are:
- March 21, 2017, Memorandum -- FY 2018 President’s Budget: Major Policy and Final Resources Decisions;
- March 24, 2017, Memorandum -- Executive Order 13777: Enforcing the Regulatory Reform Agenda; and
- March 24, 2017, Memorandum -- Improved Management of Regulatory Actions.
More information on these memoranda are available in our full memorandum Internal EPA Memoranda Outline Approach for Regulatory Deconstruction; Stakeholders Have the Opportunity to Seek to Protect Programs at Risk.
On Wednesday, April 12, 2017, from 11:00 a.m. to 12:30 p.m. (EDT), the American Bar Association’s Section of Environment, Energy, and Resources will be hosting a teleconference on this very topic, entitled “What Happens Now at EPA: Assessing the Executive Orders and Upcoming Regulatory Reform.” Registration is available online.
By Lynn L. Bergeson and Margaret R. Graham
On March 1, 2017, President Trump’s Executive Order (EO) 13777, Enforcing the Regulatory Reform Agenda, issued on February 24, 2017, was published in the Federal Register. 82 Fed. Reg. 12285. This EO follows closely on the heels of his previous EO concerning government regulations (EO 13771), but is different in that it is intended to further and enforce President Trump’s EO as well as EO’s issued in prior administrations, instead of creating an entirely new set of directives. EO 13777 directs the head of every agency (except those receiving a waiver) to designate an agency official as its Regulatory Reform Officer (RRO), who will “oversee the implementation of regulatory reform initiatives and policies to ensure that agencies effectively carry out regulatory reforms,” including the following initiatives and policies:
- EO 13771 of January 30, 2017 (Reducing Regulation and Controlling Regulatory Costs), regarding offsetting the number and cost of new regulations;
- EO 12866 of September 30, 1993 (Regulatory Planning and Review), as amended, regarding regulatory planning and review;
- Section 6 of Executive Order 13563 of January 18, 2011 (Improving Regulation and Regulatory Review), regarding retrospective review; and
- The termination, consistent with applicable law, of programs and activities that derive from or implement EOs, guidance documents, policy memoranda, rule interpretations, and similar documents, or relevant portions thereof, that have been rescinded.
The EO also establishes Regulatory Reform Task Forces (RRTF), consisting of the agency RROs and other designated agency officials, which will evaluate existing regulations and make recommendations to the agency head regarding their repeal, replacement, or modification. Each RRFT is tasked with identifying regulations that:
- Eliminate jobs, or inhibit job creation;
- Are outdated, unnecessary, or ineffective;
- Impose costs that exceed benefits;
- Create a serious inconsistency or otherwise interfere with regulatory reform initiatives and policies;
- Are inconsistent with the requirements of Section 515 of the Treasury and General Government Appropriations Act of 2001, or the guidance issued pursuant to that provision, in particular those regulations that rely in whole or in part on data, information, or methods that are not publicly available or that are insufficiently transparent to meet the standard for reproducibility; or
- Derive from or implement EO’s or other Presidential directives that have been subsequently rescinded or substantially modified.
Within 90 days of the EO, the RRTFs are also directed to provide a report to the agency head detailing the agency’s progress toward the following goals:
- Improving implementation of regulatory reform initiatives and policies pursuant to Section 2 of this order; and
- Identifying regulations for repeal, replacement, or modification.
Agencies that generally issue very few or no regulations may be eligible for a waiver, but the agency head must file a request with the Director of the Office of Management and Budget (OMB) for a waiver, and waivers can be revoked at any time. More information on EO 13771 and OMB’s Guidance on same is available in our blog items EPA Issues Report to Congress on Implementing Amended TSCA Provisions, President Trump Issues Memo and Order on Reducing Federal Regulations and OMB Issues Guidance on Implementation of “One In, Two Out” Executive Order.
By Lynn L. Bergeson, James V. Aidala, and Margaret R. Graham
On February 2, 2017, Dominic J. Mancini, Acting Administrator of the Office of Management and Budget’s (OMB) Office of Information and Regulatory Affairs (OIRA) issued interim guidance in a questions and answers format (Q&A) to implement President Trumps’s recent Executive Order (EO) regarding the costs of agency rulemaking, Memorandum: Interim Guidance Implementing Section 2 of the Executive Order of January 30, 2017, Titled “Reducing Regulation and Controlling Regulatory Costs.” More information on the EO is available in our blog item EPA Issues Report to Congress on Implementing Amended TSCA Provisions, President Trump Issues Memo and Order on Reducing Federal Regulations.
The OMB memorandum, issued for regulatory policy officers and executive departments and agencies and managing and executive directors of certain agencies and commissions, states that it explains three requirements specified in the EO:
- That every agency must identify two existing regulations to be repealed when they promulgate a new rulemaking;
- That there can be no incremental costs (no greater than zero) for any new regulations or for the repeal of any regulations for fiscal year (FY) 2017, unless otherwise required by law or consistent with advice provided in writing by the OMB Director; and
- In furtherance and in relation to # 1, if there are any new incremental costs, they will be offset by the elimination of the existing costs of at least two prior regulations.
Agencies planning to issue one or more significant regulatory action on or before September 30, 2017 (the end of FY 2017), are directed to provide: (1) “[a] reasonable period of time before the agency issues that action, identify two existing regulatory actions the agency plans to eliminate or propose for elimination on or before September 30, 2017”; and (2) “[f]ully offset the total incremental cost of such new significant regulatory action as of September 30, 2017.”
The memorandum’s Q&As cover 23 questions under three categories: Coverage; Accounting Questions; and Process and Waiver Questions. A few of the stated answers include:
- The requirements only apply to significant regulatory actions issued between noon on January 20, 2017, and September 30, 2017;
- New significant guidance or interpretive documents will be addressed on a case-by-case basis;
- Regulatory actions issued before January 20 that are vacated or remanded by a court after that date will not qualify for savings, but regulatory actions overturned by subsequently enacted laws will qualify, on a general basis;
- Costs should be measured as the opportunity cost to society, and be annualized as defined in and in accordance with OMB Circular A-4, a Memorandum on Regulatory Analysis issued in 2003;
- Regulatory actions should be eliminated before or on the same schedule as the new regulatory action they offset (to the extent feasible);
- Regulatory savings by a component in one agency can be used to offset a regulatory burden by a different component in that same agency; and
- An agency that is not able to generate sufficient savings to account for its regulatory actions may submit a request to the OMB Director to request a transfer of savings from another agency.
This guidance about the meaning and implementation of the EO will provide greater direction to the broad goals of the Trump Administration’s desire to “reduce regulation.” On its face, this “2 for 1” directive is a clear message to the agencies to reduce the regulatory burdens of their work, mostly regardless of the particular mission or underlying legislative requirements of the affected programs.
One obvious target of such effort is the U.S. Environmental Protection Agency (EPA), widely criticized during the Trump campaign and in the party platform as causing harm to the economy and hindering economic growth. Like any broad campaign rhetoric that becomes more substantive as the specifics are rolled out, it is interesting to see what the possible exceptions are or to speculate where implementing the broad rhetorical goal will lead to unpredictable outcomes. An example might be how reductions in record-keeping costs in one EPA program might offset new regulatory costs in another: this ironically may give new internal value to some parts of EPA which have routinely been more heavy-handed in imposing regulatory requirements. “Burdensome and unnecessary” requirements imposed by the enforcement office may be of help in the ability to propose new water program regulations -- or any number of odd fellow combinations may come to the surface.
Other unanticipated consequences will also include those regulations that are actively supported by the affected regulated entity. The pesticide industry is one example where a regulation establishing the allowable amount of a pesticide used on food -- the tolerance -- is essential for completing the registration process allowing the use of a new pesticide. So this kind of regulation fosters innovation and economic return to the industry, and without this regulation, the product will not make it to market. So the new Administration policies must allow for and distinguish between a sort of “good” regulation and a “bad” regulation -- all fitting within the broad rhetorical directive of a “2 for 1” approach to reducing regulatory burdens.
By Lynn L. Bergeson and Margaret R. Graham
In January, the U.S. Environmental Protection Agency (EPA) issued its initial report to Congress on its capacity to implement certain provisions of the amended Toxic Substances Control Act (TSCA). The report, prepared by EPA’s Office of Chemical Safety and Pollution Prevention (OCSPP) for the Committees on Energy and Commerce, and appropriations of the U.S. House of Representatives, and the Committees on Environment and Public Works, and Appropriations of the U.S. Senate, was directed to be provided within six months of enactment under Section 26(m)(1) of amended TSCA. In the report, EPA states that it anticipates “ramping up from 10 risk evaluations in FY2017 to 15 in FY2018, reaching 20 by the end of FY2019,” which is necessary “to accomplish an ongoing pace of at least 20 EPA-initiated risk evaluations underway” by the end of calendar year (CY) 2019. EPA also provides a table on page five, Table 1: TSCA Risk Evaluations, Numbers Underway and Resources Estimates, which presents estimates for its annual costs, calculated by dividing the average lifecycle costs of the actions by the number of years the statute provides for the agency to complete those actions, and then multiplying the result by the numbers of actions required/anticipated to be underway each year. The total annual costs range from $12.3 million for FY2017 to $35.8 million for FY2021. The report refers to the rule to implement the fee collection provisions, stating it is “currently under development,” but does not provide any more details on when it will be issued.
On January 30, 2017, President Trump issued a Memorandum for the Heads of Executive Departments and Agencies in the Federal Register which directs federal agencies to “support the expansion of manufacturing in the United States through expedited reviews of and approvals for proposals to construct or expand manufacturing facilities and through reductions in regulatory burdens affecting domestic manufacturing.” 82 Fed. Reg. 8667. The memo will require the Secretary of the Department of Commerce (DOC) to conduct outreach to stakeholders concerning the impact of federal regulations on domestic manufacturing and to solicit comments for 60 days concerning “Federal actions to streamline permitting and reduce regulatory burdens for domestic manufacturers.” DOC is also instructed to coordinate this process with the Secretaries of EPA, the U.S. Department of Agriculture (USDA), the U.S. Department of Energy (DOE), and the Administrator of the Small Business Administration (SBA), among others, and within 60 days after the process is completed, to submit a report setting forth a plan to streamline federal permitting processes for domestic manufacturing and “to reduce regulatory burdens affecting domestic manufacturers,” identifying “priority actions as well as recommended deadlines for completing actions.”
Also on January 30, 2017, President Trump issued an Executive Order on reducing regulation and controlling regulatory costs casually referred to as the “one in, two out” order which states that when executive departments and agencies “publicly propos[e] for notice and comment or otherwise promulgat[e] a new regulation, [they] shall identify at least two existing regulations to be repealed.” The order also states that no incremental costs can be accrued for any new regulations unless required by law or advised in writing by the Director of the Office of Management and Budget (OMB). For any costs that are accrued, it is directed for them to be “offset by the elimination of existing costs associated with at least two prior regulations.” In the order, the OMB Director is tasked with providing guidance on implementation, as well as identifying the total amount of costs allowed for each agency “in issuing new regulations and repealing regulations for the next fiscal year.” The regulations exempt from this order are: regulations issued with respect to a military, national security, or foreign affairs function; regulations related to agency organization, management, or personnel; and other categories exempted by the OMB Director.