TSCA Regulations: Today's Challenges and Tomorrow's Reforms

Now is the time to digest the full complement of new rules, evaluate the impact to organizational reporting, determine whether gaps exist in expertise or capabilities, and understand what options exist to fill those gaps.

The question most often asked when addressing this topic is, "Are you ready for TSCA reform?" as if it is looming on the horizon but has yet to happen. The truth, however, is that most producers, manufacturers, and importers of chemical substances are dealing with chemical management changes on a daily basis.

Last year, there seemed to be growing momentum on this topic when both the Toxic Chemicals Safety Act of 2010 (H.R. 5820) and the Safe Chemicals Act of 2010 (S. 3209) were introduced. Both bills were immediately referred to congressional committees, where they remained for quite some time. Although one committee hearing was held on H.R. 5820, no further legislative activity was ordered, and because these bills were introduced in a previous session, no further action can occur. So are they dead? Not likely. Members often reintroduce bills that did not come up for debate under a new number in the next session. Although last year's expedited reform came to a halt, it is safe to say Toxic Substances Control Act (TSCA) reform by Congress is not behind us. However, when it will return remains a question.

What issues should companies consider? For starters, EPA Administrator Lisa Jackson delivered a bold and sweeping announcement in September 2009 outlining principles for legislative reform of TSCA while directing the agency to publicize administrative "enhancements" to the existing program. The administrator reiterated these principles, attempting to gain momentum, during her October 2010 testimony before the U.S. Senate Subcommittee on Superfund, Toxics and Environmental Health.

Non-Legislative Chemical Management Reform
Following the 2009 announcement, the EPA has been hard at work modernizing TSCA through the existing limits of the law. To date, the agency has released eight Chemical Action Plans (CAPs) and is in the process of completing two more. This indicates the agency will be taking regulatory action through TSCA 5(a)(2), 5(b)(4), and 6(a) to increase requirements and restrict or ban numerous chemicals.

Another area of significant change involves Confidential Business Information (CBI). As a part of its ongoing effort to fulfill a commitment to transparency and increased public access to information on chemicals, EPA may deny confidentiality claims for the identity of chemicals in health and safety studies. On Feb. 10, 2011, EPA notified five companies that the identities of chemicals in health and safety studies submitted as confidential are not eligible for confidential treatment.

Evaluating Business Impacts
Almost every business involved in the chemical industry is impacted by TSCA regulations to some degree (with some exceptions among food, drug, cosmetic, nuclear, and pesticides companies). Raw materials, intermediates, and finished goods are all regulated by TSCA. Full lifecycle, or cradle to grave, compliance is an essential component of TSCA, and most manufacturing/importing, processing, and disposal activities are TSCA regulated.

Penalties for non-compliance can include civil litigation and monetary settlements, criminal prosecution, fines, damage to a company's brand or reputation, and negative impact on a company's ability to do business. Willful violators can face imprisonment.

Increased TSCA requirements resulting from EPA's chemical management reform and increased enforcement will accelerate the burden on organizational EH&S compliance activities. Additional data, resources, and expertise may not be readily and immediately available. With that in mind, here are four areas of concern for your immediate consideration:

1. Willful Violations: "Willful" is no longer limited to those who purposefully and covertly intend to subvert applicable regulations, and EPA is far from the only watchdog. Knowing (or knowing better) that conditions exist for non-compliance has become the new baseline.

Consumer groups and eco/environmental activism have elevated awareness and increased the number of groups that monitor, scrutinize, and report on a broad base of industry-specific, chemical-related activities. As the focus shifts from compliance to Corporate Social Responsibility (CSR), this issue requires corporate governance, procedural review, and an enterprise-wide program that includes ongoing employee education and awareness training. The critical impact of willful violations should not be underestimated.

2. CBI: This issue is likely to have a broader impact than expected. Organizations should be selective in the types of molecules that are deployed and should look for common alternatives. In preparation for current and future changes that may make it very difficult not to disclose formulation ingredients, manufacturers may want to consider avoiding the design of complex molecules for trade secret purposes. It is and will become even more difficult to protect.

The substantial investment of time, effort, and money in R&D to keep formulations confidential may have little to no return. Consider using existing chemicals that are already commonly known, and develop an action plan to prepare for competitive challenges now.

3. Inventory Update Rule (IUR): There are new challenges associated with the required filing this year. This list is detailed and includes mandatory electronic filing; the addition of previously exempted chemicals (when meeting/exceeding the 25,000-pound threshold); elimination of the 25,000-pound threshold for certain chemical substances as well as requiring manufacturers (including importers) of such chemicals to report under the IUR rule, regardless of the production volume; and increased data requirements because the form has expanded and calls for more information about chemicals in commerce.

Now is the time to digest the full complement of new rules, evaluate the impact to organizational reporting, determine whether gaps exist in expertise or capabilities, and understand what options exist to fill those gaps. The next reporting period is scheduled for June 1 to Sept. 10, 2011, for information on 2010 production.

4. Greener and Safer Alternatives: CAPs have been (and will continue to be) developed that will further restrict the manufacture and use of substances and compounds. Though there is no accepted rating system in place to uniformly evaluate substances, mixtures, and finished goods, there is a wealth of hazard data, global regulatory content that identifies environmental impact, and other informational resources that can assist with decision making.

EPA has emphatically put its weight behind Green Chemistry initiatives. Organizations that plan to thrive in the marketplace in this decade and beyond will have comprehensive CSR programs that identify green initiatives and self-report on progression toward safer, greener product formulations in manufactured goods, as well as use chemicals.

Developing TSCA Compliance Plans
Compliance preparation should include a combination of tools, data, and expertise. A comprehensive and detailed TSCA compliance plan should include a chemical inventory cross-reference review in which all ingredients (pure chemicals, mixtures, and finished products) -- imported or manufactured -- are clearly identified and referenced against the current list of TSCA-regulated substances.

Also, because an increasing number of states are enacting legislation to ban or restrict chemical substances, state regulations should be reviewed. In addition, companies should strive to accurately identify all ingredients subject to these requirements in the states where they operate. Regulatory tracking is also important on the federal level; companies should regularly access, monitor, track, and evaluate regulatory changes likely to affect the manufacture, import, or export of chemicals.

In addition, companies would be well advised to establish a comprehensive, documented process to evaluate potential R&D exemptions. Be advised, however, that this can involve complexities and exhaustive documentation.

Import certifications and export notifications also should be considered. The former entails determining the imported substances that are TSCA regulated and obtaining the necessary certifications, while the latter involves the establishment of processes for tracking 12(b) exports and assisting with required export notifications.

Finally, don't minimize the importance of accurate recordkeeping. Maintain required records and audit against written recordkeeping standards to ensure compliance. Companies also may want to consider developing and maintaining a comprehensive process to comply with the recordkeeping requirement concerning alleged adverse health or environmental effects.

Chemical companies can also benefit from involvement in the reform movement, possibly through industry association such as the Society of Chemical Manufacturers & Affiliates (www.socma.com), the American Chemistry Council (www.americanchemistry.com), or the Society for Chemical Hazard Communication (www.schc.org).

Adapting to the Cycle of Change
One thing is abundantly clear: When it comes to the manufacture, import, and export of chemicals, change is here now, and more substantial change is on the horizon.

First things first: By focusing on and complying with the current challenges of change, an organization is better positioned to adjust to the increased requirements that sweeping legislative reform may bring. Though EPA's proposed 2012 budget reveals a 12.9 percent ($1.3 billion) reduction, chemical safety and sustainability research spending is expected to increase by 14.4 percent (a $17 million increase).

Companies should act now without delay. Compliance with non-legislative chemical reform is neither simple nor easy. Procrastination will only bring more costs, delays, and problems in the future.

This article originally appeared in the May 2011 issue of Occupational Health & Safety.

About the Authors

Kami Blake is a Solutions Engineer with 3E Company. In this role, she provides technical expertise to assess regulatory requirements, information management technology, and analysis of existing hazmat programs to develop compliance solutions. Blake launched her career in 1982 in the United States Marine Corps and is a two-time Navy Achievement Medal recipient for small systems implementation and training. Prior to joining 3E in 2002, she served in Quality Assurance, Supply Chain Management and Process Engineering roles in the biotech and medical device manufacturing industries. She can be reached at [email protected] or 800-360-3220.

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