There has been a lot of activity regarding the Toxic Substances Control Act (TSCA) over the last several months. To summarize key TSCA movements and shed light on potential upcoming activities, we have rounded up information on select areas that companies impacted by TSCA should know about. Read on to learn more about the below topics or contact us directly with your site-specific questions.
- May 27, 2020 Deadline to Self-Identify for Risk Evaluation Fees
- Current EPA Risk Evaluations
- TSCA SNURs for PFAS
- Chemical Data Reporting (CDR) Update
- TSCA CDR and Toxics Release Inventory (TRI)
1. UPCOMING MAY 27, 2020 DEADLINE TO SELF-IDENTIFY FOR RISK EVALUATION FEES
The Environmental Protection Agency’s (EPA) May 27, 2020 regulatory deadline for producers and importers to self-identify if they produce or import (or ceased production or importation of) any of the 20 high-priority substances (HPS) subject to risk evaluation under TSCA is rapidly approaching. This deadline was recently extended from the original March deadline by two months and is unlikely to change, according to the information provided during the April 16, 2020 EPA call on TSCA fees. Rule obligations appear to be forging on despite the current national COVID-2019 crisis and are not addressed under the EPA’s Enforcement and Compliance Assurance Program.
What is EPA Asking for and Does it Apply to Me?
By May 27, 2020, producers and importers of HPS under TSCA must submit a response to EPA via the Central Data Exchange (CDX) indicating whether they are a producer or an importer of HPS, or certify that they ceased making or producing HPS. Some companies were already identified in EPA’s Preliminary List of Manufacturers. Companies that were not identified in this initial list are still subject to potential 2018 Fees for Administration of the Toxic Substances Control Act Rule (Fees Rule) obligations. Notably, however, the Fees Rule does not apply to processors and downstream users who do not produce/import the HPS, nor does it apply to producers that incorporate the HPS into a product.
Are There Any Specific Exemptions?
Other than the general TSCA statutory exclusions, the Fees Rule does not allow for exemptions typically afforded under other TSCA rules, such as CDR’s non-isolated intermediates. Nor are there exemptions for de minimis quantities. However, based on stakeholder feedback, EPA has indicated that it intends to propose the following exemptions for certain manufacturers 1 via additional rulemaking to be finalized by October 1, 2021:
- Importers of the chemical substance in an article
- Producers of the chemical substance as a byproduct
- Producers or importers of the chemical substance as an impurity
Understanding TSCA definitions for “article,” “byproduct,” and “impurity” is critical in interpreting these proposed exemptions as they impact the potential Fees Rule obligations.
How Much Money Does EPA Need to Collect?
With a cost of $1.35 million per risk evaluation and 20 risk evaluations to complete in this cycle, EPA seeks $27 million in recovery. The cost assessed per company will depend on the number of entities identified for each HPS, factoring in increased premiums for large businesses to fund 80% discounts for any small businesses involved. Fees may be paid individually or by consortia and amounts due are not to be pro-rated according to production volume or market share. Based on the published payer lists (see docket EPA-HQ-OOPT-2019-0677) and using 1,3-butadiene (CAS 106-99-0) as an example (with 110 companies identified), an approximate per capita fee would be $12,000 due October 2020. Based on feedback from the April 16, 2020 EPA call, the agency indicated it expects only one entity within a given organization to self-identify as a payer (either headquarters, a subsidiary, or a facility) and, therefore, only one fee would be due per applicable HPS.
What Happens After Self-Identification?
In June 2020, EPA is expected to publish a final list of companies subject to a mandatory share of the risk evaluation fee. If your company is on the final list, EPA will issue you an invoice in the CDX in August 2020. Fee payments will be due within 120 days of EPA publishing the final scope of 40 CFR 700.45(g)(3)(iv).
What is the Consequence of Failing to Self-Identify?
TSCA has afforded EPA significant enforcement authorities. Failure to self-identify² and/or pay the invoiced fees would likely be considered a violation under TSCA 15 U.S.C., Title 40 C.F.R. 700.49, with civil penalties potentially reaching the order of $40,000 per violation per day.
Is There Anything Else I Should Know?
Every U.S. producer and importer³, particularly if subject to past CDR and/or TRI reporting⁴, should examine EPA’s preliminary list of manufacturers to determine if their parent/subsidiary organization is identified as a candidate payee. As a second potential due diligence check, companies should search their chemical inventories for any of the HPS in their value chain. Depending on the outcome, companies may find that they were erroneously identified as a potential payee. For example, they may be excluded if they fall under one of the new exemption categories afforded by the No Action Assurance, if they ceased manufacturing prior to March 21, 2020 and for at least five years subsequent to the certification, if they are a processor, or if other statutory exclusions apply.
While the May 27, 2020 deadline is an important date to keep in mind in terms of the obligation to potentially self-identify, it is also an important milestone to correct any listing errors via the CDX portal and to submit HPS-specific comments to EPA via the respective dockets. This is important given that when EPA publishes updated lists in June 2020, those lists will be considered final with no statutory mechanisms for further corrections, appeals, or amendments.
2. A NOTE ON CURRENT EPA RISK EVALUATIONS
The fees generated as part of the Fees Rule directly support the completion of ongoing risk evaluations. Under TSCA, the EPA manages a comprehensive risk prioritization, evaluation, and management process. The first step in the process, prioritization, involves screening existing chemical substances and designating at least 20 as high priority and at least 20 as low priority.
Under step two, the risk evaluation process, EPA takes the 20 chemical substances designated as high priority and assesses whether any of the chemicals present an unreasonable risk to health or the environment under the chemical’s conditions of use. Efforts to complete risk evaluations for the first 20 HPS and previously identified substances are underway. Recently, EPA published draft scope documents for HPS undergoing risk evaluations.
EPA’s risk evaluation process involves identifying hazards caused by the chemical (e.g. health impacts) and assessing potential exposures to the chemical. Following this evaluation, the EPA uses available information to characterize the risk and make a draft determination on whether the chemical presents an unreasonable risk to health or the environment. If the EPA determines unreasonable risk, the chemical moves onto step three, risk management.
Currently, 32 existing chemicals are undergoing EPA’s risk evaluation process under TSCA and nearly a dozen chemicals have had recent risk management actions taken under the reformed TSCA. Of these substances, three were added to the risk evaluation set, subsequent to a request from manufacturers.
3. MORE ON RISK EVALUATION - TSCA SNURs FOR PFAS
On March 3, 2020, the EPA published the proposed supplemental significant new use rule (SNUR) for certain long-chain PFAS used in surface coatings in the Federal Register. Under the supplemental SNUR, companies seeking to import products containing long-chain perfluoroalkyl carboxylate (LCPFAC) substances in surface coatings must notify EPA at least 90 days before commencing import. This required notification triggers an EPA review to evaluate the risks associated with the substance’s proposed use.
In deciding whether the use of a chemical represents a “significant new use,” EPA uses a multi-factor review under Section 5(a)(2) of TSCA, which includes determining:
- The projected volume of manufacturing and processing of a chemical substance
- The extent to which a use changes the type or form of exposure of human beings or the environment to a chemical substance
- The extent to which a use increases the magnitude and duration of exposure of human beings or the environment to a chemical substance
- The reasonably anticipated manner and methods of manufacturing, processing, distribution in commerce, and disposal of a chemical substance
The proposed supplemental SNUR is a follow-up to a proposed SNUR rule from 2015 and narrows the scope. The 2015 proposal intended to require notification of significant new uses for the importation of a subset of PFAS as part of all articles; the recent supplemental proposal would apply only to long-chain PFAS that are a part of surface coatings.
4. ARE YOU MAKING PROGRESS ON YOUR TSCA 2020 CDR?
The 2020 CDR reporting cycle begins on June 1, 2020 and runs through the extended deadline of November 30, 2020. The new e-CDRweb reporting tool is undergoing beta testing and is expected to be accessible by June 1, 2020. Trihydro has participated in this beta testing and early findings indicate minor issues with using Internet Explorer as the browser, performing bulk uploads, and entering site information, among other data entry/processing user operations. A few new CDR reporting aspects to look out for include:
EPA recently held a call to introduce the new e-CDRweb tool and presentation materials are available.
- An “agent” role, which allows companies’ “authorized officials” to assign access to individuals who can then create and edit forms as well as submit amended CDR forms
- Exemptions for certain listed byproducts recycled onsite in an enclosed system or created in pollution control and/or boiler equipment not directly involved in the reported substance’s manufacturing
- Voluntary reporting of percent range of a byproduct contained in a reported substance
- Removing “remanufactured, reprocessed, and reused” terms when seeking information on reportable chemicals recycled or otherwise used for commercial purpose
- Processing and use code coordination with those from the Organization for Economic Cooperation and Development (OECD), starting with the requirement for HPS and optional for the rest in the 2020 CDR
- The requirement to report the North American Industrial Classification System (NAICS) for the site of manufacture
- An updated naming convention for parent company identification
- A new definition of the highest-level parent company
- Identification of foreign entities
- Joint CDR secondary submitter reporting of specific chemical function and percent composition in imported product
- Separate co-manufacturer reporting mechanisms in e-CDRweb.
5. TSCA CDR AND TRI
Another reporting deadline is also fast approaching – EPA’s TRI. The submission deadline for TRI reports is July 1, 2020. This is a statutory deadline and EPA does not have the authority to change it. However, EPA has stated that the Enforcement and Compliance Assurance Program in response to COVID-19 may be applicable to TRI reporting on a case-by-case basis.
The TRI report is an annual reporting obligation concerned only with chemical usage at a facility over the previous calendar year. Furthermore, the list of TRI chemicals includes only about two-thirds of the list of TSCA workplace chemicals. Nevertheless, the information gathered for TRI reporting is a good starting point for compiling the reporting obligations for TSCA. Since the TRI report is an annual obligation, facilities can use the screening calculations for the past four years to examine production volumes and flag chemicals that may need to be included in the TSCA report in 2020.
INTERESTED IN MORE?
Understanding the nuances and implications behind TSCA’s regulatory rules can prove difficult for even the most organized and experienced companies. We have experts in-house who are tracking TSCA developments and who can assist in translating what changes mean for your organization. We also have TRI reporting experts if you have questions and would like to connect.
 Under TSCA definition, the term manufacturer equally encompasses both producers and importers
 Importers need to pay particular attention since TSCA views their rule obligations at par with producers; information available within the value chain is typically less comprehensive
 EPA relied on CDR and TRI to identify candidate payers