On September 27, 2018, the U.S. Environmental Protection Agency (EPA) issued a final fees rule under the Toxic Substances Control Act (TSCA). The final rule largely tracks the proposed rule. The EPA will host a series of webinars focusing on TSCA submissions and fee payments under the final rule. The agency has posted a pre-publication version of the final rule, as well as its response to public comments on the proposed rule.
The Frank Lautenberg Chemical Safety for the 21st Century Act provides the EPA the authority to require payment from certain manufacturers and processors submitting information to the EPA. To reflect inflation and ensure fees suffice to cover 25% of administration costs for TSCA Sections 4, 5, 6, and 14, the EPA can adjust and increase fees as necessary every three years — beginning October 1, 2018. Before establishing new fees or revising any existing fees, the EPA is required to consult with manufacturers and processors, or their representatives.
The final rule establishes fees for certain activities under TSCA Sections 4, 5, and 6 to defray approximately 25% of the costs to carry out a broader set of activities under these sections and of collecting, processing, reviewing and providing access to and protecting from disclosure, as appropriate under TSCA Section 14, information on chemical substances under TSCA. In addition, the final rule establishes fees for risk evaluations requested by manufacturers to defray 50% or 100% of the costs, depending on whether the chemical is listed on the TSCA Work Plan.
The EPA promulgated several provisions from the proposed rule without modification, including the general methodology for calculating fees (except in the case of manufacturer-requested risk evaluations), the program cost estimates, the eight proposed fee categories, the fee amounts, the allowance of payment of fees through consortia, the discounted fees for small business concerns, and the provision of refunds under certain circumstances. The EPA determined there is “good cause” for making the final rule effective one day after publication. The final rule will apply to all submissions starting October 1, 2018, and the EPA will invoice companies within 30 days of the effective date.
The final rule focuses fee collection primarily on manufacturers. The EPA will collect fees from processors only when they submit a significant new use notice (SNUN) or test marketing exemptions (TME) under Section 5, when a Section 4 activity is tied to a SNUN submission by a processor, or when a processor voluntarily joins a consortium and therefore agrees to provide payment as part of the consortium. Table 1 includes the final fee amounts.
The EPA is promulgating reduced fee amounts for small businesses, consistent with the proposed rule and without change. The reduced fee amounts represent an approximate 80% reduction compared to the base fee for each category. The EPA notes that it is adjusting the small business size standard, and has decided to apply an employee-based definition modeled after the Small Business Administration’s (SBA) approach. The SBA also is required by statute to review periodically and adjust its size standard to keep it current with industry and market conditions.
The final rule is well developed. The EPA’s commitment to move toward actual cost accounting in tracking its costs for activities under Sections 4, 5, 6, and 14 is commendable. That said, chemical stakeholders need to know and understand the business implications of higher fees, and in some cases, much higher fees, under TSCA than in years past. TSCA budgets will need to be higher and will increase regularly.
LYNN L. BERGESON is Chemical Processing's Regulatory Editor. You can e-mail her at email@example.com
Lynn is managing director of Bergeson & Campbell, P.C., a Washington, D.C.-based law firm that concentrates on conventional, biobased, and nanoscale chemical industry issues. She served as chair of the American Bar Association Section of Environment, Energy, and Resources (2005-2006). The views expressed herein are solely those of the author. This column is not intended to provide, nor should be construed as, legal advice.