As Enactment of TSCA Reform Legislation Approaches: Overview of the Recent Compromise Provisions

Since its enactment in 1976, the primary US law regarding chemical safety evaluation – the Toxic Substances Control Act (TSCA) – has not been substantively updated.  As a result, confidence in the TSCA program has eroded, which has created pressure for states, and even some large retailers, to adopt their own chemical regulatory or screening programs.  Over time, it has become apparent to many that TSCA needs updating – not only to ensure consistent national standards, but also to reflect advances in science and technology since 1976.

TSCA reform has been in the works for years, but by the end of 2015, TSCA reform bills had been passed by both the House and Senate, and this year, negotiations began to harmonize the House and Senate versions.  On May 17, a bipartisan group of House and Senate leaders, including Senate Environment and Public Works Committee Chair Sen. Jim Inhofe( R-Okla.), Committee Ranking Member Barbara Boxer (D-Calif.), and House Energy and Commerce Committee Chair Rep. Fred Upton( R-Mich.), announced that a compromise has been reached.  The announcement indicates final votes could occur soon.  Legislators hope to pass a final bill during the week of May 23.

While final negotiations continue, we have reviewed a preliminary draft version of the negotiated conference bill, H.R. 2576, entitled the TSCA Modernization Act (dated May 16, 2016).  The following is a summary of some key points from the draft compromise legislation.

Preemption:  A major sticking point for prior reform efforts was how and when a federal law might preempt state laws.  Reflecting that controversy, the May 16 draft legislation includes a long and complicated discussion of preemption (Section 13), including the following:

• States would not be permitted to implement requirements to develop information about a chemical substance that is likely to produce the same information required by federal guidelines (an “anti-duplication” provision).
• The draft also prohibits states from implementing restrictions on the use of a chemical which EPA has determined does not pose an unreasonable risk of injury to health or the environment, or for which EPA has issued a TSCA 6(a) or Significant New Use Rule, unless the state is acting to ensure compliance with another federal law.  
• The bill also restricts a state’s ability to require the notification to the state of a significant new use for a chemical or chemical compound when the EPA has already approved the significant new use and requires notification under § 5 (the so-called “Regulatory Pause” provision). 
• The compromise draft also includes grandfathering provisions for existing state laws and regulations.   

Chemical Screening Process:  Another topic on which there was disagreement was the screening process to decide which chemicals will require a full risk assessment.  The May 16 version of the bill would prioritize existing chemicals in multiple steps for evaluation of risks (Section 6):

• The bill would require EPA to issue a rule within one year that establishes a risk-based screening process for designating substances as high or low priority and for conducting risk evaluations.  High priority substances would require a risk evaluation, while low priority substances would not.  EPA would prioritize chemicals based on a variety of factors, including persistence, bioaccumulation, potentially exposed populations, storage near drinking water sources, conditions, of use, and the volumes manufactured or processed.
• Risk evaluations of at least 20 high priority chemicals would need to be initiated within three-and-a-half years after the bill’s enactment.  Further, the agency would need to designate at least 20 chemicals as low priority within three-and-a-half years of enactment.  Each risk evaluation is to be completed within three years of initiation, with a potential extension of an additional six months.
• In addition, manufacturers and processors could also request EPA prioritize specific chemicals for an evaluation, subject to the payment of fees.
• The bill also provides requires EPA to initiate risk evaluations of at least 10 chemicals included in the 2014 Update of the TSCA Work Plan within 180 days of enactment.
• The bill also includes provisions to require a tiered screening and testing process, and to reduce the use of vertebrate animals in testing.

TSCA Safety Standard:  One of the bill’s most significant changes to EPA’s current authority is regarding criteria for restricting a chemical substance.  Section 5(3).  The bill would make several changes to the implementation of the current TSCA safety standard of an “unreasonable risk of injury to health or the environment”:

• The regulatory threshold would include consideration of whether the chemical’s conditions of use would attain the safety standard.
• The threshold explicitly includes potentially exposed or susceptible populations in evaluating risks.
• The bill prohibits EPA from considering cost and other non-risk factors in evaluating risks.

Confidential Business Information:  The compromise draft also makes some changes to EPA’s treatment of manufacturers’ confidential business information (CBI).  Under current law, CBI claims have no expiration and remain in place indefinitely.  Under the new law, companies seeking to protect the specific chemical identity of a chemical substance must submit a notice to EPA substantiating the confidentiality of the chemical compound, at which point the details of the compound can be added to the CBI portion of EPA’s § 14 database list of regulated chemicals.  The draft law also directs that substances for which no notification of CBI is submitted would be placed on the non-confidential portion of the § 14 list.  The law calls for EPA to develop a retroactive review plan for evaluating whether chemicals on the existing list require CBI protection or whether they can be placed on the non-confidential portion of the list.  CBI protections will last ten years by default, after which the party claiming CBI would be required to re-substantiate the claim of confidentiality. 

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We reiterate that the above points are based on a preliminary version of the legislation, and that further changes are possible before the bill is finalized.  We will provide a further update once the final legislation is released.

With the reauthorization of TSCA finally becoming a reality, companies will need to understand what TSCA reform means for their business.  Steptoe’s lawyers, scientists and regulatory specialists are well-prepared to assist clients in planning for TSCA reform implementation, including how it may impact related state regulatory programs such as California's Prop 65.