March 01, 2015

Removing the Roadblocks to TSCA Reform

Lawrence E. Culleen

At the time of its enactment nearly forty years ago, the Toxic Substances Control Act (TSCA) represented the cutting edge of environmental legislation. The new statute offered compelling, cross-media and “cradle-to-grave” authority providing the Environmental Protection Agency (EPA) an opportunity to fill various gaps left by media-specific environmental laws of the early 1970s, such as the Clean Air Act and Clean Water Act. Congress handed EPA a comprehensive capacity to collect information on chemical substances in commerce, to compel the producers and users of such substances to perform testing of the substances’ potential effects on human health and the environment, and to take action to mitigate risks presented by such substances. In addition, TSCA’s requirements concerning new chemicals that had not yet entered commerce embodied a groundbreaking principal that later would become the cornerstone of the pollution prevention ethos. Specifically, section 5 of TSCA established that new substances should undergo a review by EPA even before commercial manufacture would commence, during which EPA would be authorized to act by an administrative order to restrict or prohibit the manufacture and use of a new substance if, in the absence of data, EPA determined the new substance or the activities proposed may present an unreasonable risk to human health or the environment.

Notwithstanding the wealth of authority and the breadth of the chemical-regulatory landscape that TSCA enables EPA to cover, frustration apparently abounds, as the need for legislative reform of TSCA is universally accepted by parties on all sides of the issue. The General Accounting Office even identified the federal TSCA program in 2009 as a “high risk” program warranting attention by Congress due to certain features of the statute and EPA’s failure to identify and adequately act on chemicals risk. However, the reasons for EPA’s inability to fully realize TSCA’s promise are not entirely attributable to the statute itself, just as the reasons for seeking TSCA reform are not uniform throughout the various camps. Nevertheless, enthusiasm to “fix” TSCA persists.

The struggles experienced in taking up TSCA reform in both chambers of the 113th Congress, and the inability to find sufficient support to bring a compromise bill to the floor for a vote, signal the need to take a fresh and more pragmatic look at TSCA reform. Following a brief history of TSCA reform efforts, this article will focus on identifying the few significant roadblocks to TSCA reform, considering why they are impediments, and offering suggestions concerning which obstacles can be removed so that progress can be made on enhancing TSCA.

Following the 2008 election, chemical regulation reform was at the forefront of the Obama Administration’s environmental agenda. Then-EPA Administrator Lisa Jackson remarked that Americans had “lost faith” in the government’s ability to regulate chemical substances. Eight months into President Obama’s first term, Administrator Jackson announced principles for reform of TSCA at a time when Congress appeared poised and willing to act on TSCA reform. The Senate and House held hearings on TSCA in 2009 and 2010, and in 2011. Senator Frank Lautenberg (D-NJ) and Congressmen Bobby Rush (D-IL) and Henry Waxman (D-CA) introduced similar and far-reaching bills to amend TSCA in 2010. Senator Lautenberg tried again in subsequent years with bills weighted down by the breadth and complexity of the regulatory regime they sought to impose. Not daunted, in the spring of 2013, Senator Lautenberg once again introduced a bill that signaled no movement toward middle.

In an unexpected twist, less than one month later, Senators Lautenberg and David Vitter (R-LA) joined forces in May 2013 to introduce compromise legislation, the Chemical Safety Improvement Act (CSIA or S-1009). The bill embodied significant concessions, but met with opposition from the left, including Senator Boxer (D-CA), the chair of the Senate Environment and Public Works Committee.

Republicans in the House entered the fray over the nation’s most overlooked environmental law. Following a series of promising hearings, in early 2014, Representative John Shimkus (R-IL), the chairman of the House Energy and Commerce Subcommittee on Environment and the Economy, released a “discussion draft” of a bill to amend TSCA entitled the “Chemicals in Commerce Act” (CICA). Several iterations of the discussion draft were released in 2014.

The progress made during the months since the Lautenberg-Vitter bill was introduced in the Senate, and the Shimkus discussion drafts were floated in the House, resulted in a revised version of the Lautenberg-Vitter bill being floated following behind the scenes efforts by staff to arrive at an acceptable bipartisan “substitute” version of S. 1009, which Senator Boxer could get behind and the trade associations could indulge. The draft bill floated in the Senate reflected some critical compromises in the forms of a mark-up of S. 1009. Rather than engendering support from the chair, the draft prompted Senator Boxer to publically release her own two-part mark-up of the Vitter-Udall discussion draft.

Senator Boxer’s version addressed many of the key issues that have vexed participants in the TSCA Reform debate—in some cases by moving the draft farther to the left. This effectively ended all hope that TSCA reform legislation could be passed in either chamber during the 113th session of Congress. Moreover, it has become apparent that the ongoing struggle might overwhelm enthusiasm for TSCA Reform entirely unless a more pragmatic approach is undertaken.

What Are the Roadblocks to TSCA Reform?

While there are numerous topics and legislative provisions about which key participants in the TSCA reform movements can choose to disagree, there are five significant impediments that, if they can be addressed successfully, might pave the way for legislation that can be supported by leaders on both sides of the aisle in both chambers. These roadblocks are wanting to fix everything at once, viewing preemption as a hobgoblin, trying to establish a “safety standard” for all chemicals, exaggerating concerns about confidentiality, and making TSCA into a registration program.

Why Do These Roadblocks Exist?

The roadblocks to TSCA Reform have been constructed, like many roads to hell, through good intentions. The frailties of those with influence over the drafting process have also played a role. Let’s examine the five roadblocks briefly, one by one.

Wanting to fix everything at once. Having been starved of the possibility of getting TSCA reform for decades, enthusiasts have not been able to resist the very human urge to engorge and order every item of interest on the legislative menu. Thus, authors of TSCA reform legislation have tended to swing for a “home run.” Examples are not hard to find. A number of TSCA reform bills stretched nearly 200 pages in length, offering amendments or wholesale replacements for every single provision in TSCA and, in certain cases, added as many as ten significantly detailed new sections to TSCA. Reformers have wanted to legislate on topics not specifically addressed in the current law such as green chemistry, international cooperation, animal testing, and hot spots analyses. These topics are certainly important, but at times it appeared that no one was asking whether such topics might be more easily addressed by making more targeted revisions to the existing law.

Viewing preemption as a hobgoblin. Although nearly uniform core principles for TSCA reform have been published by trade and environmental groups (and the Administration) alike, mistrust has abounded. Preemption has provided an issue that allows that undercurrent to play out.

Frustration with EPA’s apparent lethargy (or legal impediments) when taking action on chemical substances has provided incentive for citizens’ groups to call upon activist state legislatures to take direct action. Not surprisingly, as certain states began legislating in the chemicals-regulatory sphere, the desire to curtail such action by adding stronger preemption terms to TSCA only grew. This determination grew when language appeared in early TSCA reform bills that would have further restricted the preemption language in the existing law.

When the CSIA included terms that would broaden the preemption language in the current law, the wheels began to come off the bus. More problematic was language that appeared to contradict the “savings clause” in section 20 of TSCA, which currently provides, “nothing in this section shall restrict any right which any person (or class of persons) may have under any statute or common law to seek enforcement of this Act or any rule or order under this Act or to seek any other relief.” The CSIA language at issue would have provided that when EPA has issued a final “safety determination for a high-priority substance under section 6, the determination shall be admissible as evidence in any public or private action in any court of the United States or State court for recovery of damages or for equitable relief relating to injury to human health or the environment from exposure to a chemical substance.” Moreover, CSIA provided that EPA’s safety determination “shall be determinative of whether the substance meets the safety standard under the conditions of use addressed in the safety determination.”

Enter the trial lawyers. Prior to that point in the TSCA reform debate, trial lawyers had not paid particular attention to the law. Few, if any, private causes of action have been brought seeking relief through tort claims based on alleged violations of TSCA; and the effect of the savings clause in TSCA has been addressed differently in federal district courts. The trial lawyers, through letters and testimony, have since made clear to Congress their disdain for attempts to allow TSCA to preempt state common law or statutory claims for damages. This has added credence to fears voiced by others about the states being boxed out of the chemicals-regulatory arena by a bill containing strong preemption language.

Real or imagined, the fear that TSCA reform legislation would lead to complete preemption of the states’ ability to take regulatory action on chemical substances prompted Senator Boxer, in marking up the Vitter-Udall discussion draft, to remove the language of the two senators and to obliterate completely the existing TSCA preemption language that has been in effect for nearly forty years. Senator Boxer’s mark-up retained the compromise language that already had been worked out by Senator Vitter’s and Senator Udall’s staff members, making clear that federal safety determinations would not preempt any state common-law claims and should not be considered determinative of safety in civil judicial proceedings.

In any new Congress, drafters will find themselves struggling with the bar set by the Boxer mark-up and the perception among certain stakeholders that any preemption language in a TSCA Reform bill is untenable.

Trying to establish a “safety standard” for all chemicals. The current law envisions a logical progression in EPA’s regulatory capacities under TSCA, permitting EPA to act to control risks before a chemical substance enters the market, encouraging EPA to gather data when a substance is in commerce but EPA lacks sufficient data to reach a determination with regard to its potential hazards, and granting EPA the authority to act to limit or prohibit activities that result in exposures or releases of a chemical substance in the marketplace if there is reason to believe there are legitimate concerns.

More specifically, Congress empowered EPA to regulate under the current law, when it finds there is an “unreasonable risk of injury to human health or the environment.” The standard differs slightly depending upon the section of TSCA under which EPA is acting. Thus, acting under section 5, in a premarket interval (preemptively, and most likely without definitive health and environmental studies), EPA may act when there is insufficient information to permit a reasoned evaluation of the health and environmental effects of a substance if it finds the substance in question may present an unreasonable risk. Similarly, for substances on the market, and for which EPA wishes to gather additional data, it also need only support the “may present” finding (either on the basis of a risk concern or based on the nature or scope of exposure that is occurring). When EPA has gathered sufficient data, it must make a “presents or will present” unreasonable risk finding.

But in no instance is EPA charged under the current TSCA with determining that a substance is “safe.” That burden is incredibly difficult to meet in the arena in which EPA must maneuver. I cannot imagine any regulator wanting to make such a determination on the record, much less swiftly, with vested interests on all sides peering over his or her shoulder—legal briefs at the ready. Federal regulators are more adept when focusing on assessing concerns for human and environmental exposures in the context of identifiable risk scenarios, where risks and benefits can and must be balanced. This is true for drugs, pesticides, and air and water pollutants. If we do not want to impede EPA, we should consider admitting that nothing is likely to be labeled as completely safe, and establish guideposts in an amended TSCA for when it is reasonable (and expected) that EPA can take action to mitigate risks.

Removing the notion that EPA will be the sole arbiter of chemical safety also might enable legislators to surmount one of the more vexing concerns about federal preemption under TSCA discussed above: the use of EPA “safety” assessments in the context of civil litigation.

Exaggerating concerns about confidentiality. TSCA generally provides for the public disclosure of information submitted to EPA pursuant to the Act, but like many other federal statutes, provides that information that is legitimately a commercial trade secret is protected from public disclosure except under limited circumstances. Businesses submitting information to EPA commonly assert claims that certain information is “confidential business information” (CBI).

Because CBI claims were rarely questioned during the first thirty years of TSCA, information submitters often operated under the premise that it was always acceptable to claim information provided to EPA to be confidential. Too often, that standard was applied when submitting toxicity data to EPA based on fears that third parties might use the data to question the safety of a company’s products. The lack of an “upfront” requirement to substantiate CBI claims exacerbated the practice by making claims all too easy.

In recent years, there has been heightened interest in TSCA CBI policies and practices. Understandably, non-governmental entities seeking to gain information access, especially health and safety data, cried foul. In contrast, the submitters of premanufacturing notices (PMNs) and information on novel chemical substances and how they are produced and used have legitimate concerns about protecting their innovations. Such information typically is very closely guarded; even shared within companies only on a “need-to-know” basis, especially when the information might reveal roadmaps to advances in manufacturing processes or telegraph to competitors an enterprise’s entry into a previously unexplored market. Such concerns were justifiably heightened by reform bills that preceded S. 1009 and staked out positions that potentially would have gutted even the FOIA trade secrets provision as it has been applied to the specific identities of chemical substances in commerce.

In fairness, EPA has never publically articulated a position that suggested its willingness to reveal deliberately commercially sensitive information, such as the identities of raw materials suppliers, production techniques, and chemical use information when claimed CBI. Instead, EPA has concentrated its efforts pressing for public disclosure of the specific identity of a chemical substance when claimed as CBI in the context of health and safety studies. Arguably, the contours of the current law place this category of information within the realm of legitimate debate about the necessity for such claims.

EPA has made great strides in recent years pushing back on unnecessary or out-of-date claims for confidentiality. Such progress has been made without the benefit of new rules or legislation. But the perception that submitters of health and safety data have been quick on the trigger to claim entire studies confidential most likely will only be undone by legislative amendments.

Making TSCA into a registration program. A commonly held belief is that EPA’s new chemicals program is “working,” notwithstanding the absence of sophisticated health and environmental data on most new chemicals. Nevertheless, some drafters of reform legislation have not been willing to resist tweaking section 5 of TSCA. The inclination makes sense, and is human, especially when the opportunity to make changes legitimately to the current law has been so long coming. It is not unlike a dentist saying, “Well, as long as we’re in here, why don’t we replace a few of these fillings that are outdated and sure to give you problems someday.”

This inclination reflects a desire to make TSCA into FIFRA, or the equivalent of Europe’s REACH regulation—a registration program for all chemicals in commerce and all uses of those chemicals. Like the dentist, certain drafters seem willing to say, “. . . and as long as we are looking at all new chemicals, let’s require EPA to make a case-by-case and use-by-use determination that each one is ‘safe.’”

But the section 5 program has a feature that goes unrecognized, yet it is the secret to the program’s success: EPA staff must act swiftly, or lose the opportunity to do so. The necessity of doing that job effectively (albeit thanklessly) has motivated EPA scientists to think creatively and to develop systems and models that are functional and fast, and to date, believed to be generally reliable. That task is made simpler by knowing that a complete safety determination is not needed, and all uses need not be anticipated—in part because significant new use rules can capture potential new uses for EPA review, and further actions also can be taken under sections 4, 8, and 6 if warranted. Moreover, the program’s decision makers know very well that the absence of data coupled with a cognizable level of concerns about potential risks or widespread exposure or release has provided an adequate basis for EPA staff to threaten to take regulatory action. PMN and significant new use notice submitters know it, too. Thus “consent” orders are agreed to between EPA and section 5 notification submitters because the alternative (a potentially lengthy and public legal battle) is not a preferred outcome for either side.

How Can We Remove These Roadblocks?

Don’t bite off more than can be chewed. Focus on what’s “really broke” in the current law, then find the way to fix it. Suggestions for simple, targeted amendments that are unlikely to be met with resistance include: requiring EPA to establish and act on risk assessments made for priority chemical substances by certain deadlines; making it possible for EPA to gather test data, use and exposure information through administrative orders issued under sections 4 and 8 rather than through rulemakings; leaving the section 5 programs alone; removing some procedural obstacles to issuing section 6 rules (e.g., public hearings; the preference for implementing only the “least burdensome” requirement); and requiring CBI claims to be substantiated upfront, and to be withdrawn or resubstantiated at specific intervals (e.g., when a new chemical enters commerce, when a substance is identified as a high priority for review, upon receipt of a FOIA request for information claimed as CBI).

Put preemption squarely back into Pandora ’s Box. Maybe the answer is to just leave well-enough alone and not touch the current preemption language in TSCA. The current language preempts state actions under limited circumstances, and leaves open the possibility that a state may take a regulatory action on the basis of another authority. Perhaps, if EPA establishes a robust risk assessment and risk management program under TSCA, activist states will find better things to do than pick fights on the basis of the chemical “flavor of the day.”

Streamline the methods EPA has at its disposal to act to gather data and to restrict chemicals when risks to health and the environment occur or are reasonably foreseeable.

Allow EPA to act when unreasonable risks may occur if additional controls or mitigation measures are needed to control exposures, rather than when unreasonable risks have already occurred (e.g., when a persistent substance is appearing in the environment and in mothers and children—even if only at levels below a known risk).

Don’t strive for absolute chemical safety—allow EPA to evaluate the context (intended and foreseeable uses) and to take actions that may be imperfect, but that will reduce exposure and mitigate risks.

Modify the administrative rulemaking procedures in TSCA to require only notice-and-comment procedures, and simplify the standard for judicial review to align with such processes.

Limit the duration of CBI claims, permit resubstantiation, and require it when certain events transpire (see discussion in 1, above)—but do not burden EPA with paperwork exercises involving endless reviews and rereviews of substantiated claims.

Conclusion

That TSCA reform is long overdue is undisputed, but practical solutions for bridging positional differences on significant roadblocks must be found soon—before enthusiasm for the venture wanes on the Hill, in trade associations, and among the NGOs. The foregoing review of the obstacles to TSCA reform and the mechanisms for breaking them down can provide the basis for a streamlined reform bill that proposes specific edits to the existing law, rather than adopting the “rewrite and replace” approach that has hampered efforts thus far. Targeted amendments ultimately may create a greater opportunity for timely and meaningful TSCA reform than further posturing on the issues. A middle ground exists and it is ready to be explored.

Lawrence E. Culleen

Mr. Culleen is a partner at Arnold & Porter LLP who previously served in a variety of management positions within EPA in programs that govern pesticides and chemical substances.