Bergeson & Campbell, P.C. (B&C®) is a Washington, D.C. law firm providing chemical and chemical product stakeholders unparalleled experience, judgment, and excellence in matters relating to TSCA, and other global chemical management programs.

By Lynn L. Bergeson and Carla N. Hutton
 
The U.S. Environmental Protection Agency (EPA) will hold a webinar on December 6, 2022, to provide an overview to stakeholders about its November 16, 2022, supplemental proposed rule modifying and adjusting certain aspects of the fees rule established under the Toxic Substances Control Act (TSCA). EPA states that it is publishing these changes to ensure that collected fees provide it with 25 percent of authorized TSCA costs consistent with direction in the fiscal year 2022 appropriations bill to consider the “full” implementation costs of the law. According to EPA, updating TSCA fees will strengthen its ability to implement successfully TSCA in a way that is both protective and sustainable and significantly improve on-time performance and quality. The webinar will provide stakeholders an opportunity to provide comment to EPA on the supplemental proposed rule. Registration for the webinar is open. Stakeholders who wish to provide oral comments during the webinar are asked to register by December 1, 2022. Comments on the supplemental proposed rule are due January 17, 2023. More information on the supplemental proposed rule will be available in our forthcoming memorandum.


 

By Lynn L. Bergeson and Carla N. Hutton
 
On December 21, 2020, the U.S. Environmental Protection Agency (EPA) released a proposed rule that would amend the 2018 Toxic Substances Control Act (TSCA) fees rule.  According to EPA, the proposed rule “reflects real-world situations, narrows the broad scope of current requirements, significantly reduces the burden on American businesses, and increases the flexibility for surrounding TSCA fees requirements.”  Under TSCA, EPA collects fees from chemical manufacturers and processors to help fund implementation to ensure that public health and the environment continue to be protected.  TSCA requires EPA to review its fees every three years and, after consulting with parties potentially subject to the fees, to adjust the fees if necessary.  The proposed updates include:

  • Narrowing the scope of the TSCA fees rule by exempting importers of articles containing a chemical substance, companies that produce a chemical as a byproduct or manufacture or import as an impurity, companies that produce a chemical in de minimis amounts, companies that use chemicals solely for research and development (R&D) purposes, and companies that manufacture a chemical that is produced as a non-isolated intermediate from fees;
     
  • Using cost data gathered over the past two years, instead of estimates, to update the fee calculations;
     
  • Ensuring fees are fairly and appropriately shared across companies by proposing a production-volume based fee allocation and including export-only manufacturers for EPA-initiated risk evaluations;
     
  • Allowing for corrections to be made to the list of manufacturers subject to fees for EPA-initiated risk evaluations after the final list is published, ensuring the accuracy of the list;
     
  • Increasing flexibility for companies by extending the amount of time to form consortia to share in fee payments;
     
  • Ensuring that EPA can fully collect fees and enabling companies to prepare better for paying fees by allowing payments in installments for EPA-initiated and manufacturer-requested risk evaluations; and
     
  • Adding new fee categories associated with new chemicals activities.

Comments will be due 45 days after EPA publishes the proposed rule in the Federal Register.  More information will be available in a forthcoming memorandum that will be posted on our website.


 

By Lynn L. Bergeson and Margaret R. Graham

On December 22, 2017, the U.S. Environmental Protection Agency (EPA) sent to the Office of Management and Budget (OMB) a proposed rule establishing fees on certain submissions under amended Toxic Substances Control Act (TSCA) Sections 4, 5, and 6.  EPA has indicated that it expects to propose the rule in the early part of the New Year:  EPA’s regulatory agenda lists February 2018 for the proposed rule and September 2018 for the final rule.

More information on the TSCA fees rulemaking and requirements is available in our blog item “EPA Hosts August 11, 2016, Public Meeting on Proposed Rule for Revised TSCA Fees,” in our memorandum “TSCA Reform:  An Analysis of Key Provisions and Fundamental Shifts in the Amended TSCA,” and in our September 20, 2016, webinar “‘The New TSCA’ Webinar 4: Administration of the Act, Preemption, Fees, and Green Chemistry.”

Tags: TSCA fees, OMB

 

By Sheryl L. Dolan, Kathleen M. RobertsJames V. Aidala, and Lynn L. Bergeson

On August 11, 2016, the U.S. Environmental Protection Agency (EPA) convened a public meeting to solicit comments prior to development of a proposed rule to implement the revised Section 26 fees provision under the new Toxic Substances Control Act (TSCA).  Public comments may be submitted through regulations.gov in docket EPA-HQ-OPPT-2016-0401 until August 24, 2016.

During the meeting, EPA solicited public comment in particular on the following five issues:

  1. To be able to defray 25 percent of costs of administering Sections 4, 5 and 6, and Confidential Business Information (CBI), does industry have considerations of weight amongst the three areas of fee collection?
  2. Does industry have thoughts on the types of factors (types of submissions, numbers of submissions, level of difficulty, etc.) that EPA should consider when structuring the fees?
  3. Has industry considered how to distribute payment amongst multiple manufacturers and/or processors?
  4. Does industry have thoughts on how to identify the whole universe of manufacturers, including importers and processors affected?
  5. Does industry have thoughts on how to arrive at an appropriate balance between manufacturers and processors?

In its presentation, EPA stated that it intends to publish a proposed rule by mid-December 2016, and a final rule in time for its statutory June 22, 2017, deadline.

Four industry trade associations gave prepared remarks during the meeting:  the American Chemistry Council; the American Petroleum Institute; the Society of Chemical Manufacturers and Affiliates; and the American Fuel & Petrochemical Manufacturers.  Their comments reflected several common but competing themes, including:

  • EPA needs to share its expectations of internal costs as a starting point for discussions of the fee structure.
  • The fee system should be straightforward to implement.
  • EPA should be mindful in developing a fee structure so as not to stifle innovation; for example, placing too high of fees for review of new chemistries under Section 5 or confidentiality claims under Section 14.
  • Not all sections should be given equal weight; in particular, as industry will pay for Section 4 data development, it should not be double-charged by assessing a fee for EPA’s review of these data.
  • EPA must provide adequate consideration for the effect on small businesses.
  • Consideration should be given to incremental fees, tied to EPA milestones.
  • A business should have a way to exit from a Section 6 risk evaluation process if it elects to exit the market.

Commentary

Congress recognized that the new TSCA tasks EPA with significant additional responsibilities, and included Section 26 as a venue to ensure adequate resources would be available to develop the infrastructure to meet these responsibilities according to the specified timelines and in conformity with sound science.  Input from all affected stakeholders will be needed to devise a workable TSCA fee system, particularly in the compressed timeframe for rule development. 

EPA and industry stakeholders are supportive of a simple framework, but the complexities and current unknowns of how new TSCA will operate will make this goal challenging.  Many questions exist that will not be answered before next week’s comment deadline:

  1. Should a company have to pay fees for a Section 6 risk evaluation on uses that it does not support? 
  2. Should there be fees associated with Section 6 prioritization actions?  If not, does that mean that only high priority chemicals will have Section 6 fees assessed on them? 
  3. Given the new threshold for affirmative findings under Section 5, will EPA complete the same number of new chemical notifications that it has in the past?  If not, should that anticipated reduction in notification reviews be reflected in the fees proposal? 
  4. Most industry stakeholders recognize that the current PMN fee of $2,500 will be increased, but how much is too much?   
  5. As previously noted, is it appropriate to require industry to pay for testing under Section 4, and then charge for EPA review of that test data? 
  6. To ensure that sufficient funds are raised, will we need to assess a fee for every “touch” that EPA has within Sections 4, 5, and 6?  How can that cost be fairly allocated among all industry players, including small businesses?

While EPA did not offer to share information on budgets at the August 11, 2016, meeting, the Office of Pollution Prevention and Toxics (OPPT) presumably has pertinent information supporting its annual budgets that must be shared in the near term if it hopes to receive any meaningful ideas on a proposed fee structure.  Although past program outputs done under old TSCA may bear little resemblance to the duties EPA now has under new TSCA, EPA’s new policies and responsibilities will be some scale of past program capabilities and budget.

Of more relevance will be the experience of OPPT’s sister program, the Office of Pesticide Programs (OPP).  OPP has had a dedicated stream of user fees since the 1988 amendments to the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA), and additional fees were imposed in 2004 with enactment of the Pesticide Registration Improvement Act (PRIA) fee-for-service program.  While the FIFRA product licensing program is different in many respects from TSCA, there are relevant commonalities that OPPT should find helpful.  OPP has a time accounting system, for example, that provides a principled basis on which to estimate the time required for study report review and risk evaluation. 

With estimates derived from the time accounting system, OPP (and presumably OPPT) can estimate how much it costs EPA to review toxicity studies individually.  For example, there is an estimate of how much it costs EPA to review a 90-day subchronic study, or how much to review a genotoxicity study. These calculations form the basis of the PRIA fee scheme, as PRIA is designed to generate one-third of the program costs involved.  The “simple” general rule underlying a now elaborate fee schedule with almost 200 categories is that the more science review involved, the greater the required fee.  The new law may not need or want to have so many different categories, but the operating principle can remain the same.

For OPPT, the dollar amounts could vary from OPP given the statutory limitation of the maximum amount to be generated, but the more difficult question will be how OPPT calculates its expected workload under the new law.  Given the wealth of information available through OPP’s experience, sharing this information would further inform the public about what to expect in, or options for how to fashion, a fee scheme.