FR 2020-28692

Summary of the Document

The document details a finalized rule by the Environmental Protection Agency (EPA), aimed at regulating Phenol, Isopropylated Phosphate (3:1), commonly known as PIP (3:1). This regulation, issued under the Toxic Substances Control Act (TSCA), seeks to manage the risks associated with this chemical by prohibiting its processing and distribution, except for specific industries like aviation, automotive, and military applications where safer alternatives are unavailable. Furthermore, the rule prohibits releasing PIP (3:1) into water, mandating adherence to best practices to minimize environmental exposure, thus protecting human health and the ecosystem.

Significant Issues and Concerns

1. Complex Language and Accessibility: The document is written in a technical and legal style, which may pose challenges for a lay audience. The intricate chemical and regulatory terminology could make it difficult for those without specialized knowledge to fully grasp the implications of the rule.

2. Favored Exclusions: Certain industries, particularly aviation and military sectors, are given exclusions without robust publicly available evidence that no feasible alternatives exist. This could lead to perceptions of bias or insufficient exploration of possible substitutes.

3. Economic Uncertainty: While there is mention of costs associated with compliance, such as testing and reformulation, these are not quantified. This omission creates uncertainty regarding the economic impacts on affected industries, making it hard for businesses to plan accordingly.

4. Lack of Risk Assessment: The document states that no comprehensive risk assessment was conducted, raising questions about the thoroughness and adequacy of the scientific basis for these regulatory decisions.

5. Confusion in Compliance Dates: The rule outlines different compliance dates and exceptions that could cause confusion. This phasing may complicate industry adaptations and compliance efforts.

6. Downstream Notification Challenges: It's unclear how effectively the document's notification requirements will be communicated along complex supply chains, potentially leading to gaps in compliance and enforcement.

Impact on the Public

For the general public, this ruling is intended to lower health and environmental risks associated with PIP (3:1) by reducing its presence in manufacturing and ensuring safer disposal methods. It reflects a preventive approach by regulating potentially hazardous substances prior to definitive risk assessments, prioritizing health and ecological safety.

Impact on Stakeholders

• Industries: Key stakeholders like manufacturers and certain industry sectors may face significant operational challenges due to compliance costs, process changes, and possible reformulation of products. This is exacerbated by the lack of clarity on economic impacts and substitutive materials.

• Regulatory Bodies: For agencies tasked with enforcement, there is a need for clear guidelines and resources to ensure the compliance and effectiveness of this rule, especially given the existing assumptions around industry adherence to other standards.

• Environmental and Public Health Advocates: This regulation aligns with their priorities, endorsing stricter controls on substances deemed hazardous without waiting for extensive risk evaluations, considered a positive precautionary measure.

This commentary highlights the complexities and potential challenges surrounding this regulatory action while underscoring its significance in protecting public and environmental health. The outcomes of its implementation will likely depend heavily on effective communication, compliance, and enforcement within the various affected industries.

The document from the Environmental Protection Agency (EPA) discusses a regulation under the Toxic Substances Control Act (TSCA) about phenol, isopropylated phosphate (3:1) (PIP (3:1)). It includes several financial references related to the costs and economic impacts of implementing the rule.

One of the key financial aspects mentioned is the total quantified annualized social costs associated with the final rule. The document states these costs amount to approximately $23.8 million at a 3% discount rate and $23.0 million at a 7% discount rate. These figures reflect the broader societal impact of the regulation, which includes the direct and indirect costs to both the government and industry stakeholders.

The document also discusses the annualized industry costs, which are reported to be $23.6 million at a 3% discount rate and $22.8 million at a 7% discount rate, projected over 25 years. These costs are primarily related to industry compliance with the new requirements, including substitution of PIP (3:1) with alternative chemicals, familiarization with the rule, and record-keeping activities.

In addition to industry and societal costs, the EPA's internal costs to implement the rule are also noted. It is estimated that the enforcement of this regulation will require 1 Full-Time Equivalent (FTE) at an annual cost of $155,152. This staffing cost reflects the administrative burden on the EPA to ensure compliance and manage the regulatory framework.

A specific reference to the total estimated annual cost for compliance with the information collection requirement is provided as $2,831. This estimation suggests that the capital or operational costs for maintaining compliance are minimal, excluding the broader implementation and transition costs for affected industries.

The document asserts that the rule does not lead to expenditures of $100 million or more in any single year for state, local, and tribal governments or the private sector, as per the Unfunded Mandates Reform Act (UMRA). This aligns with their statement that the quantified costs do not meet the threshold for what would be considered a significant unfunded mandate, which is adjusted annually and currently set at $160 million.

Several issues arise from the financial allocations and references in the document. Firstly, the methodological assumptions and lack of quantification of potential costs, such as those associated with testing and reformulation, may lead to a level of uncertainty about the full economic impact on stakeholders. Furthermore, while the document mentions assumptions of compliance with existing regulations like those from OSHA, it does not clarify how these assumptions affect the financial burden on businesses, especially small entities.

In summary, the financial references in the document highlight the economic implications of the rule for different stakeholders while noting gaps in the comprehensive understanding of potential costs due to lack of detailed quantification. These financial allocations are central to understanding the broader economic impact of the regulation and its feasibility for affected industries.