1660318145612 Epafeechangetcsa

EPA Proposes Revisions To TSCA Fees Rule

Jan. 19, 2021
The suggested additions and exemptions will improve fee collection

On January 11, 2021, the U.S. Environmental Protection Agency (EPA) proposed to amend the 2018 Toxic Substances Control Act (TSCA) fees rule. This column discusses the proposal and its improvements to the rule.

Background

Under TSCA, the EPA collects fees from chemical manufacturers and processors to help fund TSCA implementation. TSCA requires the EPA review its fee structure every three years and, after public comment, adjust the fees if necessary. The proposed rule suggests modifications to the fees and fee categories through fiscal years 2022–2024, and explains the methodology by which these TSCA fees were calculated.

The proposed rule would establish, update and revise fees collected from manufacturers (including importers) and, in some cases, processors, to defray costs related to activities under TSCA Sections 4, 5 and 6. The suggested updates and changes to the fees rule include:

• adding three new fee categories;
• exemptions for manufacturers subject to fees for EPA-initiated risk evaluations under TSCA Section 6(b);
• exemptions for manufacturers if the chemical substance is imported in an article, produced as a byproduct, or produced or imported as an impurity;
• an exemption for research and development (R&D) activities;
• an exemption for manufacturers of chemical substances produced as a non-isolated intermediate; and
• an exemption for entities manufacturing less than 2,500 lb of a chemical.

Other amendments also are proposed. In addition, the agency notes it won’t change the “small business concerns” definition.

Sustained funding is needed to designate chemical substances as high and low priorities for future risk evaluation; conduct risk evaluations to determine whether a chemical substance presents an unreasonable risk of injury to health or the environment; require testing of chemical substances and mixtures; and evaluate and review new chemical submissions, as required under TSCA Sections 4, 5, and 6. Funding also aids collecting, processing, reviewing, and providing access to and protection from disclosure as appropriate under TSCA Section 14.

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Discussion

We commend the EPA for timely issuing this proposed rule and for including provisions that address practical issues that have arisen in implementing TSCA to date, including anomalous and unanticipated challenges in which companies were paying unexpected fees. The three additional fee categories and associated fees — i.e., for bona fide notices ($500/$90 for small businesses); notices of commencement ($500/$90 for small businesses), and an additional fee related to amended test order submissions ($9,800) — are reasonable in light of the costs incurred to handle disclosure information as appropriate under TSCA Section 14.

The addition of new exemptions for manufacturers and importers subject to fees for EPA-initiated risk evaluations especially is welcome and largely motivated by industry stakeholder input. With regard to entities that manufacture chemicals as a byproduct, we wouldn’t be surprised to see the EPA refine the exemption so it’s consistent with the rule for byproduct producers under TSCA Section 5 Premanufacture Notification and TSCA Section 8 Chemical Data Reporting regulations. Under those regulations, entities that manufacture substances as byproducts for certain separate commercial purposes must report; in this light, coverage of these byproduct manufacturers under the fees rule seems both reasonable and practicable.

The EPA’s proposed new production/import volume-based methodology for calculating fees for EPA-initiated risk evaluations generally is laudable, but may present additional implementation complexities. It could also result in anomalous situations where small manufacturers are required to bear a disproportionate share of the fees. In addition, circumstances could exist in which the proportion of fees might divulge a particular company’s production volume (or average production volume). Stakeholders should consider a tonnage band model as an alternative. That way, a fee proportion can’t be used to back-calculate another’s production volume.

Given all the surprises that potential fee payers faced in 2020 when the EPA published the preliminary lists of fee payers for the “next 20” substances undergoing risk evaluation, stakeholders may wish to consider carefully the implications of the various fee scenarios.

LYNN L. BERGESON is Chemical Processing's Regulatory Editor. You can e-mail her at [email protected]

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.

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