[House Hearing, 107 Congress]
[From the U.S. Government Publishing Office]



 
          ``THE TRI LEAD RULE: COSTS, COMPLIANCE AND SCIENCE''
=======================================================================

                                HEARING

                               before the

                   SUBCOMMITTEE ON REGULATORY REFORM
                             AND OVERSIGHT

                                 of the

                      COMMITTEE ON SMALL BUSINESS
                        HOUSE OF REPRESENTATIVES

                      ONE HUNDRED SEVENTH CONGRESS

                             SECOND SESSION

                               __________

                     WASHINGTON, DC, JUNE 13, 2002
                               __________

                           Serial No. 107-62


         Printed for the use of the Committee on Small Business






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                      COMMITTEE ON SMALL BUSINESS

                  DONALD MANZULLO, Illinois, Chairman
LARRY COMBEST, Texas                 NYDIA M. VELAZQUEZ, New York
JOEL HEFLEY, Colorado                JUANITA MILLENDER-MCDONALD, 
ROSCOE G. BARTLETT, Maryland             California
FRANK A. LOBIONDO, New Jersey        DANNY K. DAVIS, Illinois
SUE W. KELLY, New York               BILL PASCRELL, JR., New Jersey
STEVE CHABOT, Ohio                   DONNA M. CHRISTENSEN, Virgin 
PATRICK J. TOOMEY, Pennsylvania          Islands
JIM DEMINT, South Carolina           ROBERT A. BRADY, Pennsylvania
JOHN R. THUNE, South Dakota          TOM UDALL, New Mexico
MICHAEL PENCE, Indiana               STEPHANIE TUBBS JONES, Ohio
MIKE FERGUSON, New Jersey            CHARLES A. GONZALEZ, Texas
DARRELL E. ISSA, California          DAVID D. PHELPS, Illinois
SAM GRAVES, Missouri                 GRACE F. NAPOLITANO, California
EDWARD L. SCHROCK, Virginia          BRIAN BAIRD, Washington
GELIX J. GRUCCI, Jr., New York       MARK UDALL, Colorado
TODD W. AKIN, Missouri               JAMES R. LANGEVIN, Rhode Island
SHELLEY MOORE CAPITO, West Virginia  MIKE ROSS, Arkansas
BILL SHUSTER, Pennsylvania           BRAD CARSON, Oklahoma
                                     ANIBAL ACEVEDO-VILA, Puerto Rico
                      Doug Thomas, Staff Director
                  Phil Eskeland, Deputy Staff Director
                  Michael Day, Minority Staff Director
                                 ------                                

            Subcommittee on regulatory Reform and Oversight

                     MIKE PENCE, Indiana, Chairman
LARRY COMBEST, Texas                 ROBERT BRADY, Pennsylvania
SUE KELLY, New York                  BILL PASCRELL, Jr., New Jersey
SAM GRAVES, Missouri                 CHARLES GONZALEZ, Texas
ROSCOE BARTLETT, Maryland            DAVID D. PHELPS, Illinois
TODD AKIN, Missouri                  JAMES P. LANGEVIN, Rhode Island
PAT TOOMEY, Pennsylvania             ANIBAL ACEVEDO-VILA, Puerto Rico
              Rosario Palmieri, Professional Staff Member









                            C O N T E N T S

                                                                   Page
Hearing held on June 13, 2002....................................     1

                               Witnesses

Nelson, Hon. Kim T., Assistant Administrator for Environmental 
  Information, U.S. Environmental Protection Agency..............     4
McGuirk, Dennis, President, IPC, Association Connecting 
  Electronics Industries.........................................    15
Mallory, James, Executive Director, Non-Ferrous Founders' Society    17
Klinefelter, Nancy, President of Baltimore Glassware Decorators 
  representing the Society of Glass and Ceramic Decorators.......    18
Morrow, Hugh, President, North American Office, International 
  Cadmium Association............................................    20

                                Appendix

Opening statements:
    Pence, Hon. Mike.............................................    27
Prepared statements:
    Nelson, Hon. Kim T...........................................    31
    McGuirk, Dennis..............................................    44
    Mallory, James...............................................    60
    Klinefelter, Nancy...........................................    73
    Morrow, Hugh.................................................    77
Additional Information:
    Submission by Thomas Sullivan, Office of Advocacy, SBA.......    83
    Post Hearing Question and Answer submission..................   101












      HEARING ON THE TRI LEAD RULE: COSTS, COMPLIANCE, AND SCIENCE

                              ----------                              


                        THURSDAY, JUNE 13, 2002

                  House of Representatives,
                       Committee on Small Business,
           Subcommittee on Regulatory Reform and Oversight,
                                                    Washington, DC.
    The Subcommittee met, pursuant to call, at 10:07 a.m. in 
room 2360, Rayburn House Office Building, Hon. Mike Pence 
[Chairman of the Subcommittee] presiding.
    Chairman Pence. This Subcommittee on Regulatory Reform and 
Oversight of the House Committee on Small Business hearing 
entitled ``The TRI Lead Rule: Costs, Compliance, and Science'', 
is convened.
    The Chair will recognize the gentleman from Pennsylvania 
for some brief opening remarks after a few remarks of my own.
    I wish to thank all of our witnesses for their attendance 
today, but, most especially, the Environmental Protection 
Agency and the representative who joins us here today, with 
apologies for my tardiness. I am the victim this morning of 
having one too many Subcommittees in my life and appreciate the 
forbearance of our witnesses and my colleague from 
Pennsylvania.
    I want to begin by giving the EPA my congratulations this 
morning. The threat of lead poisoning, especially to children, 
has been dramatically reduced in our country. Much of that, I 
would offer today, is due to the work of the good men and women 
at the EPA and other agencies of the federal government.
    Former Health and Human Services Secretary Donna Shalala 
said in announcing the 1997 CDC results, ``These lower lead 
levels for America's children constitute a public health 
achievement of the first importance. For our children as a 
whole, we have achieved average blood lead levels which would 
have been considered impossible just a few decades ago.''
    Governor Whitman's predecessor at the EPA had this to say. 
``The ongoing reduction in blood lead levels is a great 
American success story of environmental and public health 
protection. Years of aggressive action against lead exposure, 
particularly EPA's banning of lead in gasoline two decades ago, 
are yielding a brighter future for our children,'' and indeed 
they are.
    The Center for Disease Control, in the same document, did 
go on to note that the job of lead exposure reduction is not 
complete, saying, ``There are still close to one million 
children with a blood lead level that is associated with 
adverse effects on children. In addition, the survey showed 
that more than one-fifth of non-Hispanic black children living 
in older homes had elevated blood lead levels. This pattern 
reflects the most serious remaining sources of lead exposure; 
deteriorating paint in older housing, dust and soil 
contaminated by paint and residues from past emissions of 
leaded gasoline.''
    Beyond those accolades and the kind of affection that this 
Chairman developed for the EPA when they spent three months 
decontaminating my anthrax-contaminated office with great 
professionalism and alacrity, I am disappointed today, though, 
that we are not maximizing the benefits of this great 
achievement. It seems we are not taking these results as a 
lesson for further progress on this public health issue.
    Today, we are not talking about further reductions of 
children's exposure to lead in paint or other major remaining 
sources of concern that have been identified. Today, we are 
talking in this hearing about a paperwork regulation that will 
at best provide some new information about the uses of lead 
that present no real risk for human health at a significant 
cost to small businesses and to the EPA. At worst, one could 
argue, this rule will provide inaccurate information about lead 
usage and divert important resources away from more pressing 
public health and environmental needs.
    I wish I had already completed a listing of the problems 
with this rule. In addition to it not addressing the most 
important public health aspects of lead and potentially 
providing no public right-to-know benefit, this rule, for 
instance, as we may well hear today, is based on questionable 
science and lacks independent peer review.
    It eliminates burden reduction measures meant to make TRI 
reporting easier for small businesses, and it is the first 
retroactively applied TRI reporting rule, which will require 
companies to desperately search for data about lead usage prior 
to when the rule was promulgated and became effective.
    It suffers from an EPA guidance document that was not 
available until 13 months after the retroactive date for data 
collection and was 200 plus pages that, candidly, no small 
business person, let alone any congressman, could decipher. It 
subjects upwards of 10,000 new filers to burdensome reporting 
obligations under an EPA rule that many may not even know about 
yet.
    It is virtually guaranteed to produce poor quality data 
that will not well serve the public's right-to-know, creates a 
risk of enforcement actions or citizen suits against small 
businesses that may simply be unable to comply with the rule, 
despite doing their best, and, finally, I assume, in 
recognition of the questionable science underpinning this rule, 
the EPA has decided to submit to a Science Advisory Board 
review of the biggest questions, but is waiting three years 
after the final rule is published for a final report on some of 
these issues.
    This is not the EPA's finest hour, I would argue, after a 
great and I think colossal achievement in the reduction of lead 
exposure to children in this country. It stands in stark 
contrast to those reductions. This paperwork rule is also 
estimated to cost businesses between $70 and $100 million in 
the first year of implementation. When our economy is hardly at 
its peak and small businesses account for a majority of job 
growth in this country, it is not time right now for 
substantial new regulatory costs of questionable benefits to be 
imposed.
    Now is the time to prioritize, time to focus all of our 
efforts on the environmental regulations which will provide us 
with the most bang for our buck, as we say in Indiana, with the 
greatest impact on human health and the environment. This Chair 
believes that this rule does not pass this test.
    This hearing has garnered quite a bit of interest. In 
addition to the witnesses gathered today, we also have 
testimony submitted by the U.S. Small Business Administration, 
the National Association of Manufacturers and the Meractus 
Center. We look forward to the testimony of all of our 
witnesses.
    I would like to now recognize the Ranking Member, the 
gentleman from Pennsylvania, Mr. Brady, for his opening 
statement.
    [Mr. Pence's statement may be found in the appendix.]
    Mr. Brady. Thank you, Mr. Chairman. I am going to submit my 
statement for the record rather than read it all, but I would 
just like to also chime in and join in with your remarks about 
the EPA and what they have done with their paint and the safety 
of our children.
    I come from the City of Philadelphia in the State of 
Pennsylvania, which it is a great city, but it is an old city. 
It has a lot of old houses and a lot of lead paint in a lot of 
our areas, and they have done an excellent job. It has been 
extremely helpful, and our children have been allowed to grow 
up in some much better environments and better safety.
    I also was thrilled to find that the Honorable Kim Nelson 
is from the State of Pennsylvania, has been there for all her 
life, and now in the City of Washington. Do not worry about 
that. If you are from Pennsylvania, you have a great 
background. You will do fine here. I look forward to hearing 
your statement.
    Thank you.
    Chairman Pence. Before we begin receiving testimony from 
witnesses, I want to remind everyone that we would like each 
witness to keep their oral testimony to just five minutes, and 
then in order the Chair and the Ranking Member and any other 
Members that arrive will be given an opportunity to pose 
questions thereafter.
    As our first witness and no doubt veteran of Capitol Hill 
knows, but our other witnesses may not be as aware, you have a 
series of lights in front of you, and they mean just what 
traffic lights mean. The Chair will allow a certain amount of 
latitude once the red light appears, but then the gavel will 
eventually arrive.
    You should know that your entire written statement will, 
without objection, be added to the record, so you might use the 
opportunity of your remarks here to amplify points in your 
written statement.
    In our first panel we will hear from a single witness, the 
Honorable Kim T. Nelson, who is the Assistant Administrator for 
Environmental Information at the U.S. Environmental Protection 
Agency.
    Having just had a private meeting in my congressional 
office with Secretary Whitman, I am grateful, despite our 
frustrations with this rule, for the EPA's willingness to 
attend this hearing, to participate in a dialogue with the 
Small Business Subcommittee and am grateful for your 
participation, even though you are from Pennsylvania.
    Ms. Nelson is recognized for five minutes.

      STATEMENT OF THE HONORABLE KIM T. NELSON, ASSISTANT 
ADMINISTRATOR FOR ENVIRONMENTAL INFORMATION, U.S. ENVIRONMENTAL 
                       PROTECTION AGENCY

    Ms. Nelson. Thank you. I am struggling for some connection 
I have with Indiana, but it is not coming to me at the moment.
    Good morning, Congressman Pence and Congressman Brady. 
First, Chairman Pence, let me apologize since I was not at that 
meeting you had with Governor Whitman as I was out of town that 
day, but I am glad it went well.
    I do appreciate the opportunity to be here today to discuss 
with you EPA's recent rule to expand the reporting on lead and 
lead compounds under EPA's Toxic Release Inventory Program. As 
you may recall, the new TRI lead rule was carefully reviewed by 
this Administration upon entering office and was eventually 
endorsed by the President and Governor Whitman and became 
effective, as you stated, in April of 2001.
    The new rule requires any facility which is already subject 
to the Emergency Planning and Community Right-to-Know Act 
reporting provisions that also manufactures, processes or uses 
more than 100 pounds of lead or lead compounds annually to 
report to EPA their lead releases. This rule significantly 
expands the information available to the public about the 
presence and releases of lead in their communities.
    Since its implementation in 1987, the TRI has been the 
centerpiece of EPA's right-to-know programs and has proven to 
be a very powerful tool for assisting communities in protecting 
their own environment and for making businesses more aware of 
their chemical releases. The basis of the TRI lead rule is 
EPA's determination that lead and lead compounds are 
persistent, bioaccumulative and toxic chemicals. These are also 
known as PBT chemicals.
    These chemicals are of particular concern because they 
remain in the environment for long periods of time, they build 
up in the environment, and they accumulate in plants, animals 
and humans and may cause a range of very serious toxic effects.
    In assessing the persistence of lead, EPA concluded that 
lead meets the PBT criterion for classification as highly 
persistent. Because lead is a PBT chemical and it is highly 
persistent, there is a greater potential for exposure to lead.
    In assessing the bioaccumulation of lead, EPA considered 
bioaccumulation data in aquatic plants, animals and humans. In 
addition to the plant and animal data, there are extensive peer 
reviewed human data demonstrating that repeated exposure to low 
levels of lead results in a build up of lead in the bones of 
the human body where it can remain for many years. Numerous 
studies have shown that lead that has accumulated in bone can 
later move from the bone to blood, especially during pregnancy, 
breast feeding, menopause, old age, and serve as a source of 
exposure.
    The toxicity of lead to humans is well documented and 
undisputed. Of particular concern is the effect lead has on 
fetuses, infants and children because they tend to be more 
susceptible to exposures of lead and are more sensitive to the 
toxicity it causes. Their exposure to lead can cause permanent 
brain damage. Even at the very low dose levels, exposure can 
result in diminished IQ levels, impaired neurobehavioral 
development, decreased stature and growth and impaired hearing.
    During the public comment period for the proposed rule, 
questions were raised challenging the sufficiency of the 
aquatic data to support the conclusion that lead and lead 
compounds are highly bioaccumulative. In addition, EPA 
recognized that it did not clearly indicate in the proposed TRI 
rule how the human data would be used to distinguish between 
bioaccumulative and highly bioaccumulative categories. 
Consequently, EPA determined that the data clearly supported a 
finding that lead and lead compounds are bioaccumulative and 
deferred on its determination as to whether lead and lead 
compounds are highly bioaccumulative.
    In the final lead rule, EPA stated that before determining 
whether lead and lead compounds are bioaccumulative, EPA 
believes that it would be appropriate to seek external 
scientific peer review from its Science Advisory Board, and 
EPA, as you mentioned, intends to do so. The date proposed for 
the peer review of the highly bioaccumulative issues pertaining 
to the lead rules is November, 2003.
    This Administration believes that the preferred approach to 
achieving compliance with new rules is emphasizing compliance 
assistance during the first year rather than direct 
enforcement. EPA has worked hard in providing compliance 
assistance and outreach, especially for small businesses, for 
this first reporting year deadline.
    For example, EPA issued a technical guidance document to 
assist facilities, as you mentioned, in complying with the new 
lead rule. Also, in the fall of 2001, EPA sponsored nine 
workshops specifically on the new lead rule. Both the workshops 
and the availability of the draft and final versions of the 
guidance document were extensively publicized.
    In addition to these specific efforts, EPA continues to 
work hard to provide compliance assistance for facilities 
generally. For example, this spring EPA held more than 40 
workshops. Also, EPA has many more TRI compliance assistance 
resources and tools available through the internet and 
telephone hotlines.
    In conclusion, I would like to reiterate EPA's strong 
commitment to providing public access to environmental 
information and our firm belief that public access contributes 
positively to our citizens' ability to understand environmental 
issues and to make better decisions in their daily lives. An 
informed public can hold government and industry accountable 
for pollution control efforts.
    Thank you, Mr. Chairman. Thank you, Congressman Brady. I 
would be happy to take any questions.
    [Ms. Nelson's statement may be found in the appendix.]
    Chairman Pence. Thank you for that presentation. You 
mentioned a couple of different areas, and I may hit a few 
areas and then yield to Mr. Brady out of sensitivity to his 
schedule this morning.
    First, I want to reiterate that you are here speaking for 
all of the EPA, including the Office of Enforcement and 
Compliance Assurance, according to our information.
    Ms. Nelson. That is correct.
    Chairman Pence. You have described the EPA's policy as 
stressing compliance rather than enforcement in the first year. 
What does that specifically mean to a small business that is 
covered under this rule?
    Ms. Nelson. Let me say I am new to EPA. I have been here 
since the fall, but I have spent 15 years in an environmental 
protection agency in Pennsylvania.
    Like the experience I had in Pennsylvania, I believe EPA 
has a history, and particularly so now such as sensitivity, 
that the agency has the ability to exercise complete discretion 
over its enforcement actions.
    What that means particularly when you are dealing with a 
new program is that we recognize that the first year of a 
program, even a second year, enforcement actions for a program 
that is new tend to be very low on the enforcement priority 
list.
    Our emphasis is to bring facilities in compliance. I know 
of no one in this agency who is planning on taking enforcement 
actions against a facility where we show general goodwill in 
terms of complying with the requirements of the law and the 
regulations.
    Chairman Pence. Does that mean zero enforcement actions in 
the first year? If not, then when specifically would you choose 
to use enforcement?
    Ms. Nelson. Let me say, you know, we all understand 
absolutes are something that can create problems in the long 
run. It is clearly a low enforcement priority. This is, as you 
mentioned, a paper reporting exercise.
    Through this program, we are not asking people to implement 
new control technologies. We are not asking people to change 
effluent discharges or to limit effluent discharges in any way. 
This is a reporting exercise which is geared towards providing 
the agency and the American public with information.
    Our goal will be to insure the highest quality of 
information, and that is where we want to focus our resources. 
I know of no one at this point in time that would see it 
appropriate to take what we would consider an ``enforcement 
action'' against someone who has filed inappropriately or 
incorrectly or incorrect data.
    Chairman Pence. The President has asked the EPA to provide 
special assistance to small businesses----
    Ms. Nelson. Yes.
    Chairman Pence [continuing]. On this rule, tacitly 
recognizing the burden that it imposes on business.
    Ms. Nelson. Right.
    Chairman Pence. What specifically did the EPA do to help 
prepare small businesses to comply with this rule?
    Ms. Nelson. The agency first last summer held nine sessions 
throughout the country. Ten were scheduled, and, frankly, we 
canceled the one session that was scheduled in Region 2 because 
of the aftermath of September 11, but nine sessions were held 
across the country with over 700 people attending.
    Seven hundred people does not sound like a lot when you 
talk about the numbers of facilities, potentially 5,000 
facilities, give or take, that might be affected, but those 
sessions are really assigned to be a train the trainer session, 
to bring in the industry representatives, the consultants and 
the others who actually provide support to industry. Seven 
hundred people attended those sessions.
    In addition to that, we held a number of public meetings 
last summer on the guidance document. As you mentioned, it was 
EPA's plan to get the guidance document out in October. The 
meeting was held on September 10. We know we did not meet that 
deadline because of the aftermath of the events on September 
11.
    We extended the deadline, however, because of those events 
and because of certain concerns about the rule, which was one 
of the reasons the guidance document got out late. We provided 
more opportunity for public comment on the document. We could 
have gotten it out earlier, but we would have shortened the 
public comment input period.
    This fall, we held our normal TRI sessions that had a 
special focus, as they normally do, on the new reporting 
requirements. Those sessions I believe totaled more than 40 
throughout the country and were attended by thousands of 
people, in excess of maybe 3,000 people.
    We also have our hotline that is available for people to 
call in any day on the document itself and the Q&As. It is, 
from my perspective, one of the most aggressive outreach 
programs EPA has ever done in the TRI program.
    Chairman Pence. This is the first TRI rule to be applied 
retroactively. I will say procedurally I want to see if I can 
get an answer to this question, and then we will recess while 
Mr. Brady and I go for what apparently will be about 20 minutes 
of votes and be back.
    The final rule was not effective until April, 2001. The 
businesses are required to report releases starting January, 
2001. EPA did not provide a final guidance document until the 
end of January of this year. What is the justification for 
applying this rule retroactively?
    Ms. Nelson. Well, I guess we have to understand that the 
rule became effective on April, 2001, but the reports are not 
actually due until approximately 15 months later.
    The justification for allowing a rule to go into effect in 
April when reports are not due for another 15 months is the 
fact that the TRI program has always allowed filers to estimate 
their releases. It is not like other programs, our NPDS 
program, for instance, where facilities have to submit monthly 
discharge monitoring reports where those reports are based on 
real monitoring of actual occurrences.
    The TRI program has always allowed facilities to estimate, 
so it is easy or it is possible, based on formulas, for a 
facility to estimate their usage back for a period of a year.
    Chairman Pence. The Chair will ask the assistant 
administrator----
    Ms. Nelson. Yes.
    Chairman Pence [continuing]. If she can stay here. We will 
return, I presume, by about ten minutes before the hour after a 
series of votes.
    With that, we are in recess.
    [Recess.]
    Chairman Pence. Kim Nelson, the Assistant Administrator for 
Environmental Information at the U.S. Environmental Protection 
Agency, is still with us. We are grateful for your patience and 
everyone else's patience. We do not anticipate another 
interruption prior to the end of the hearing.
    The Chair has a great number of questions, but, in the 
interest of his time and schedule, wanted to yield to the 
gentleman from Pennsylvania, the Ranking Member, for any 
questions that he might have for our witness.
    Mr. Brady. Thank you, Mr. Chairman. I just have one that I 
do not understand.
    What is the difference between the TRI Form A as to the one 
that we have now that is less burdensome? Do you know?
    Ms. Nelson. The TRI Form A was a burden reduction effort 
that requires less information to be filed by a facility versus 
the full Form R.
    Mr. Brady. Was there a problem with that one, I mean, that 
it had to be changed to make it more burdensome? I mean, we are 
trying to make things less burdensome for small business.
    Ms. Nelson. The Form A came after I believe the Form R. but 
I was not here at that particular time. I can get back to you 
on that particular sequence of events.
    Mr. Brady. Okay. Thanks.
    No more questions, Mr. Chairman.
    Chairman Pence. Ms. Nelson, let me take a little different 
tact with the questions for the moment. I am going to read some 
statements from your confirmation hearing for the record and 
then ask you a couple of specific questions.
    In your confirmation hearing, you said, quoting now, ``The 
information that we provide must be of exceptional quality, 
supported with analytical tools which facilitate its use for 
assessing and managing risk and measuring environmental 
improvements.''
    You also said that it would be your intention to assist 
Administrator Whitman by helping to ``sharpen the focus of the 
EPA's environmental information strategies, reduce burden on 
industries, promote intergovernmental cooperation and apply 
best practices to achieve internal efficiencies.''
    You also said, ``I believe these activities will contribute 
significantly toward burden reduction, improved data quality 
and security, more informed environmental decision making and 
greater flexibility to manage environmental programs.''
    In light of the extensive evidence that without more time 
to get it right implementing this rule on June 30, 2002, will 
result, to put it bluntly, in extremely poor quality data, does 
this rule meet the goals expressed in your confirmation hearing 
for data quality and the right relationship between the EPA and 
small business America?
    Ms. Nelson. I still believe everything I said on that day 
when I testified, which was October 17 of last fall.
    This program I think has to be treated a little bit 
differently, as I mentioned before, from other programs in EPA. 
This program is not one where we are making individual, site 
specific risk assessment kinds of decisions.
    What is important about the TRI program is that it provides 
the agency with an opportunity to collect information that it 
and others in the community and businesses can use hopefully to 
make better environmental decisions. We recognize that I think 
in any program the first year is not going to be the highest 
performing year; that it always takes some experience under our 
belts to get to the level of high performance we would all like 
to see.
    I think there are a number of things we are doing in the 
TRI program that can help improve the quality of the data, 
which is the ultimate goal that we all have, and reduce the 
burden. For instance, my primary focus with the TRI program is 
to focus on improved electronic reporting. The one thing we 
know as we move towards e-government is that the more we can 
get facilities and others to report electronically, the higher 
the quality of the data will be.
    I do not know if you have used something like Turbo Tax 
before, but you know a software program like that, as we have 
with the newest versions of the TRI report, can help you 
calculate your answers and insure that the data submitted are 
accurate. It actually prevents you sometimes from putting in 
incorrect data, which often happens on the paper forms. 
Somebody gets a factor wrong by ten or more. We see an outlier 
way out here, and we recognize that cannot possibly be correct.
    The more you can do electronic reporting, the more you can 
prevent that from happening, so that is my focus. With my goals 
of higher quality data and burden reduction, we can actually 
reduce that burden on companies if they begin to submit 
electronically because we can make it easier for them to 
submit, and we can get higher quality data.
    Chairman Pence. Let me change gears, if I can, to the whole 
issue of science and ask you first to maybe express what is 
your view of science at the EPA? Maybe more accurately, how 
should science inform policy at the EPA? Should it be 
controlling? Is it a factor in the development of environmental 
policy?
    Ms. Nelson. As we look to new issues, there is one thing 
that I clearly have recognized the last couple years, and that 
is the issues we are going to face from an environmental 
protection perspective, regardless of where we sit in an 
organization, are issues that are getting far more complex.
    The low hanging fruit, I think we can all agree, has been 
picked, so the issue we are faced with in the future will be of 
incredible complexity for many different reasons--impacts on 
communities, impacts on the regulated community, on people, as 
well as the science.
    Governor Whitman I think has elevated in terms of stature 
within the organization the Office of Research and Development. 
Paul Gilman, Dr. Gilman, who is the assistant administrator for 
that particular office, has recently been named by her as her 
science advisor for the organization, and I think any good 
policy coming out of EPA is a policy that has to be based on 
teamwork across the organization. That teamwork includes the 
Office of Research and Development to insure that all of our 
decisions are based on sound science.
    Chairman Pence. So your view would be that all policy has 
to be based on teamwork and that essentially the researchers 
are part of that team. The science is a factor in the 
development of policy, but is it fair to say it should be the 
dominant factor in the development of policy?
    Ms. Nelson. I do not think it can be because we have 
statutory and legislative requirements, so I do not think in 
any given situation or across the board you can make a 
statement that science has to be the dominant factor. I would 
not say that now.
    I think in any given situation we have to balance and we 
have to look at all the particular drivers in any given 
situation. Some of them are statutory. Some of them are 
economic. Some of them are social. Some of them are science. It 
is our job as appointees there and as employees of the 
Environmental Protection Agency to balance those issues.
    Chairman Pence. Let me read you a quote from Governor 
Whitman in her confirmationhearing, which may be at odds with 
your prior statement. She said, ``Scientific analysis should drive 
policy. Neither policy nor politics should drive scientific results. 
Good science is the basis for all the decisions that are made at the 
agency that is critical to the credibility of the agency and the 
implementation of the decisions made by the agency.''
    Again, her initial statement is there. ``Scientific 
analysis should drive policy.'' Do you think that is a practice 
at the EPA, in your judgment?
    Ms. Nelson. Well, that is what the governor said, and that 
is what I said in my first statement that the governor believes 
strongly in sound science. I believe she had heightened the 
visibility of the Office of Research and Development in 
appointing Dr. Gilman as her science advisor, and I believe we 
all within the organization have to make decisions based on 
sound science.
    I do think that is the practice, yes, that we are all 
expected to abide by, but it is not the only one. We have to 
take other things into consideration.
    Chairman Pence. Let me see if I can get a quick yes or no 
on a series of questions, and then we can wrap up at least the 
Chair's portion of questions.
    Number one, are you aware the EPA co-sponsored a workshop 
in January of 2000 on whether it was appropriate for metals to 
be considered as PBTs?
    Ms. Nelson. I was not here at the time. I am aware that 
that did occur, yes.
    Chairman Pence. Okay. Are you aware that questions at that 
time were raised about the very characterization of lead as a 
PBT chemical in interagency reviews?
    Ms. Nelson. I am aware there was discussion of that issue.
    Chairman Pence. Are you aware that the Small Business 
Administration, in its search, has yet to find any peer 
reviewed literature, journals or reports or scientists from 
government, industry or academia to support EPA's 
characterization of lead as a PBT?
    Ms. Nelson. I am not aware of that.
    Chairman Pence. How about the fact that bipartisan 
leadership on the House Science Committee has requested SAB 
review of this issue and that the Committee has statutory 
authority to require SAB review?
    Ms. Nelson. I am sorry. Could you repeat that?
    Chairman Pence. Are you aware that the House Science 
Committee has requested an SAB review of this issue in 
particular?
    Ms. Nelson. I know prior to my coming here there was 
dialogue and discussion between various Members of Congress, 
but I am not sure of what you are specifically referring to.
    If it is an earlier request that came out of the VA HUD 
appropriation a year or so ago, my understanding was we were 
urged to look at the issue and that as a result of some 
dialogue and discussion there was an agreement on an approach.
    Chairman Pence. Are you aware that the Small Business 
Administration, the Office of Science and Technology Policy, 
the Office of Management and Budget and the Department of 
Energy are all on record supporting peer review on the 
fundamental science question behind EPA's rule?
    Ms. Nelson. I am aware this issue has been discussed by a 
number of organizations.
    Chairman Pence. Okay. Well, then let me ask. Is the 
question of whether or not lead or other metals are 
appropriately characterized as PBTs under this rule currently 
before the SAB, or will it be?
    Ms. Nelson. The issue that we are putting before the SAB is 
whether lead and lead compounds are highly bioaccumulative. The 
agency has already made the decision that lead is considered a 
PBT, so that issue is not before the SAB. The issue before the 
SAB is whether lead should be considered and lead compounds 
highly bioaccumulative.
    Chairman Pence. So again, and I appreciate your clarity----
    Ms. Nelson. Let me just say this. My understanding is also 
that issue is not before the SAB right now, but will be 
submitted to the SAB once the SAB reviews the action plan and 
the ultimate framework.
    Once that framework has been reviewed by the SAB, then it 
is the intent to put the question before the SAB as to the 
highly bioaccumulative nature of lead and lead compounds.
    Chairman Pence. Maybe that explains it. In your written 
testimony you quote from the Federal Register notice of the 
final TRI lead rule in saying that, ``The external peer review 
would address the question of whether lead or lead compounds 
should be classified as highly bioaccumulative.'' ``The 
external peer review,'' and I am reading your testimony now, 
``would address the issue of how lead and other as yet 
unclassified metals such as cadmium should be evaluated using 
the PBT chemical framework, including the types of data and 
which species are most suitable for those determinations.''
    It is the last sentence I want to focus on. What is your 
understanding of that last sentence, and when will that 
question be before the Science Advisory Board?
    Ms. Nelson. The schedule for the Science Advisory Board is 
that they will have the draft framework to review by June of 
2003.
    The draft guidance and issues based on that framework 
regarding the TRI lead rule and the highly bioaccumulative 
nature, whether lead and lead compounds are highly 
bioaccumulative, would be presented to the SAB in November of 
2003 with the expectation that the SAB would release a report 
in March of 2004. That is based on the action plan that was 
recently published.
    Chairman Pence. Would that not represent the underpinning 
of this rule? It seems like, as we say in Indiana, we are 
putting the cart before the horse.
    Ms. Nelson. I think at that point in time it would 
certainly be incumbent, based on the answers that come out of 
the SAB, for the program to evaluate the decisions and the 
implications on all of our current programs. I think it is also 
premature to change anything we are doing without that 
recommendation coming from the SAB.
    Chairman Pence. The Small Business Administration, and 
maybe we could have staff get this to you. The Small Business 
Administration has submitted written testimony----
    Ms. Nelson. Okay.
    Chairman Pence [continuing]. For this hearing. They have 
shared with us some statements by scientists and other 
organizations that contradict your evaluation of the rule.
    I am going to read to you some of these statements and try 
and get a reaction from you, and then we will wrap up and allow 
the Ranking Member to ask any follow up questions, and then we 
will move to our second panel. I will ask you to tell me if you 
think they support EPA's case or if they do not support EPA's 
case on the science behind this rule would be my main focus.
    March 23, 1995, Great Lakes Water Quality Guidelines, 
``EPA's final rule establishing water quality guidelines for 
the Great Lakes examined whether ten metals, including lead, 
were bioaccumulative substances and found that none exceeded 
the BCF of 1,000, which is used as a cutoff. EPA is now 
apparently using the same set of pre-1995 data and found that 
BCF for lead exceeds at least 1,000.''
    Do you think that supports the EPA's case or does not 
support their case on the science behind the rule?
    Ms. Nelson. Well, I think you have to be careful when you 
take a statement like this out of context that was intended for 
a specific situation.
    The data that were used here are different data than we use 
for TRI, so I think it is inappropriate for me to suggest that 
it does or does not support our case. It is a completely 
different set of data for a different purpose and used in a 
different context.
    Chairman Pence. The Science Advisory Board report in May of 
2000 was a draft case study analysis of the residual risk of 
secondary lead smelters. The quote is, ``The classification of 
metals as PBTs is problematic since their environmental fate in 
transport cannot be adequately described using models for 
organic contaminants.''
    Without again confronting you with the same repetitive 
question about whether it supports EPA's case or not, and this 
is where I want to go with the next panel, but is there a sense 
within the EPA that this whole business of PBT chemicals was 
established around the idea of chemical agents like pesticides 
that are introduced into the environment, and now it seems like 
this classification has grown into even natural minerals like 
lead.
    We can go through all of these, but all of them 
consistently challenge the very classification of lead and 
certain metallurgical natural minerals as PBTs. Is there any 
willingness at the EPA to deeply rethink the whole move into 
minerals like lead as PBT chemicals?
    Ms. Nelson. I think when we take issues like this in sort 
of chronological order and look at the history of PBT, we can 
see that these issues were dealt with, as the first one with 
the Great Lakes, for different purposes, for smaller audiences.
    The most recent one you referred to with the Science 
Advisory Board and the lead smelters, my recollection is that 
analysis by the SAB was dealing primarily with different models 
that the agency uses and different risk assessment methods.
    Again I would go back to the purpose of the TRI program. 
The TRI program is not a site specific program. The TRI program 
is not a risk assessment program. The TRI program is one in 
which we collect information that we can all use in government 
and outside of government hopefully in the future to make 
sounder decisions.
    The PBT criteria that EPA published back in 1999 and the 
methodology was published as a rule, and we did receive comment 
on that rule. It became final. That methodology for applying 
the PBT criteria to chemicals was published as a rule. In that 
rule making, EPA did clearly state that it would apply to 
chemicals, not just certain chemicals, and in fact made a 
statement that it would apply to metals. This is an issue that 
EPA clearly stated several years ago.
    While, like many issues, I believe there are different 
opinions, we have some statements here where people disagree 
with the use of PBT criteria. I think we could find an equal 
number of statements where people believe it is indeed very 
appropriate to apply the PBT criteria to metals.
    One of the things we will all learn when the framework goes 
to the SAB is what they have to say about the issue. EPA 
believes it is entirely appropriate to apply PBT criteria to 
metals. What I think is important about the approach we are 
taking now is that with the administrator and with Linda Fisher 
we have leadership in the organization that recognizes you can 
often have what appear to be inconsistencies because every 
program has a different set of regulatory and statutory 
requirements.
    I have been in government for 22 years. I have yet to find 
organizations that tend to be more diverse than environmental 
agencies with air programs, water programs, hazardous waste 
programs, radon programs. What I think we all know is that 
those individual silos often cause concern to people who are on 
the outside because they look at each individual program taking 
different actions.
    The framework that we are looking for under Governor 
Whitman's leadership will help provide an overall framework for 
programs within EPA to take that framework and apply it to 
their individual situations because they still will have very 
different needs and situations as a result of their statutory 
and regulatory requirements.
    Chairman Pence. I am sure we cannot resolve this here 
today, but it seems to me that by your testimony today that the 
larger question is before the SAB, that it seems to me that 
this rule should be delayed until questions are answered from 
the science, from the people who are charged with determining 
the appropriate science.
    Candidly, and I would ask you to convey back to Governor 
Whitman and to your colleagues at the EPA, I am just not 
prepared to sacrifice small businesses on a hunch that the EPA 
might be correct on major scientific questions related to this 
area.
    There are conflicting facts, and we will hear more 
testimony today, but it appears that there is from my 
perspective overwhelming scientific consensus against EPA's 
view of this rule. If this qualifies as an occasion where, as 
Governor Whitman said, science should drive policy and not the 
other way around, then I am convinced that we will have a 
different outcome at the end of this process, and I am 
certainly convinced that we should.
    Let me say, Ms. Nelson, we want to thank you for your 
testimony today. We are going to leave the record open so that 
we can submit some additional questions to you in writing and 
would appreciate if you can respond before the implementation 
date of this rule.
    Ms. Nelson. Sure.
    Chairman Pence. Of course, any additional comments from you 
will be added to the record without objection.
    With that, I will recognize the gentleman from Pennsylvania 
if he has additional questions.
    Mr. Brady. I am fine. Thank you.
    Chairman Pence. If there is nothing further, the witness is 
dismissed with our gratitude.
    Ms. Nelson. Thank you very much.
    Chairman Pence. This hearing on the TRI Lead Rule: Costs, 
Compliance, and Science, will continue. Next, the Subcommittee 
will hear from a very distinguished panel.
    Having heard from the EPA, and I believe most of you were 
in the room for most of that testimony, and, candidly, this 
panel I know would be grateful if you were to illuminate or 
respond to things you may have heard today. If our records are 
correct, things the EPA may have said for the first time on 
this issue were said in this hearing today. We would be anxious 
to know your reaction to those.
    First, the Subcommittee will hear from Dennis McGuirk. 
Before I introduce him, I will remind you of the lights. Do not 
feel married to your written testimony. Those of you that are 
experienced at doing this know that we will enter your written 
testimony into the record without objection, and it is often 
more helpful for the Members if you will amplify the points 
that you want to make sure we make, as well as the requests 
that are made.
    When you see the red light, try and wrap up your comments 
as quickly as possible. We will await questions until all of 
you have given your testimony and opening statements.
    Dennis McGuirk is president of the IPC, the Association 
Connecting Electronics Industries. Mr. McGuirk's previous 
service includes over 24 years of active duty service in the 
United States Air Force. He holds degrees in Western European 
Affairs from the U.S. Air Force Academy and a Master's in 
Public Administration from the University of Colorado and is 
recognized for five minutes.

   STATEMENT OF DENNIS MCGUIRK, PRESIDENT, IPC, ASSOCIATION 
               CONNECTING ELECTRONICS INDUSTRIES

    Mr. McGuirk. Thank you, and good morning, Chairman Pence 
and Congressman Brady. I am the president of IPC, a trade 
association representing the electronic interconnection 
industries.
    IPC's 2,500 members manufacture and assemble printed 
circuit boards, the backbone of our nation's high tech 
industries, including consumer, industrial and defense 
electronics. While some of our members are very large 
corporations, 60 percent of IPC members are small businesses. 
On behalf of the IPC and our member companies, I would like to 
thank you and your staff for organizing this important hearing.
    As we have heard, EPA's TRI rule lowered the reporting 
threshold for lead and lead compounds from 25,000 pounds--that 
is over 12 tons of lead--down to just 100 pounds. The 
regulation took effect on April 17, 2001, and included the 
unprecedented retroactive application of the reporting 
requirements to January 1, 2001.
    IPC members, along with many other industries, are 
concerned that the burden of this rule upon business has been 
significantly underestimated, and EPA has failed to provide 
effective compliance assistance, thereby further increasing the 
burdens on those least able to bear it.
    During the development of the rule, EPA chose not to 
convene an advocacy review panel as required under the Small 
Business Regulatory Enforcement and Fairness Act, deciding 
instead to certify the proposed and final rules as having no 
significant economic impacts on businesses. Early outreach to 
small businesses could have helped EPA determine the number of 
small companies that would be significantly impacted by this 
rule.
    Compliance with the lower reporting threshold also imposes 
a significant burden on IPC members. For a small business, the 
job of interpreting, and complying with the agency's 
instructions and guidance for TRI is substantial. To give you 
an idea of what I am talking about, we have already alluded to 
the mass amount of documents required. Before me I have the 746 
pages of reporting forms, instructions and guidelines needed to 
fill out the TRI forms.
    EPA's own estimates shows the cost of the compliance for 
the new reporters under TRI would be about $7,000 for the first 
year alone. We believe this grossly underestimates the actual 
cost, but, in any event, it is a significant amount for an 
industry that is going through decreasing consumer prices.
    During the time the rule was under consideration and after 
its adoption, many concerns were raised about the enormous 
burdens it would impose. We were pleased back in April of 2001 
when President Bush recognized this problem and directed EPA to 
help small businesses. In a May, 2001 letter to 71 concerned 
trade associations, EPA reiterated this point by promising to 
help reduce the burdens imposed on small businesses by 
developing final guidance by October, 2001.
    As we have said, unfortunately EPA did not finalize the 
guidance until January of 2002, after the entire first 
reporting year had passed. The guidance is long, it is 
confusing, and often times it is conflicting.
    In February of this year, IPC e-mailed 17 questions about 
the guidance document to EPA so that we could provide accurate 
assistance to our members. EPA took four months to respond to 
our e-mails, leaving IPC less than three weeks to respond back 
to our members with their appropriate guidance. The deadline, 
as I am sure you have heard, is June 30 of this year.
    On February 22, 2002, 43 trade associations wrote the EPA 
asking for a one year delay of the reporting requirements so 
that they could work with them to insure the collection of 
accurate data without undue burden on small businesses. The 
need for this delay is supported by EPA's own words.
    In response to a comment pointing out the confusion 
generated by EPA's inaccurate, out-of-date question and answer 
document, EPA states, ``The TRI program can only update this 
guidance document once every several years.'' If EPA is unable 
to update the key guidance documents for such a significant 
rule, it should also delay the implementation until it is able 
to provide accurate guidance and compliance assistance.
    Last month, a group of 30 trade associations met with EPA 
to further discuss concerns regarding the implementation of the 
rule and the need for the one year reporting delay. During the 
meeting, EPA acknowledged that there had been problems with the 
implementation, but noted that the first year, as we have 
heard, always serves as a road test. That may be EPA's 
perspective on the problem, but it is not shared by thousands 
of small businesses that will become the accident victims as 
EPA takes its test drive.
    Moreover, such a cavalier disregard of major problems 
identified by small business suggest that they are at the risk 
of becoming the road kill of EPA's road test. This is in direct 
conflict with the intentions of the Small Business Regulatory 
Enforcement and Fairness Act.
    Mr. Chairman, IPC members take their responsibility to 
environmental stewardship seriously. As small business owners, 
they and their families live, work and play in the communities 
where their businesses operate. Unfortunately, many of them are 
unable to fulfill their obligations to provide accurate 
information under the TRI program due to the lack of available 
information, inadequate outreach and assistance, and the 
impossibility of compiling data retroactively.
    The environment and our public health depend upon good 
environmental information. America's families cannot benefit 
from the TRI program if EPA does not insure that small 
businesses have the tools to provide accurate information.
    In conclusion, I ask you to consider whether it is 
reasonable to require thousands of small businesses to incur 
substantial regulatory burdens when EPA currently has underway 
a peer review of the very scientific framework upon which this 
expensive and burdensome regulation is based.
    We believe that in the interest of good science and good 
data, EPA should suspend or otherwise delay the reporting 
thresholds for lead until small business concerns can be 
addressed properly and the results of EPA's Science Advisory 
Board's review can be completed and assessed.
    Thank you, Mr. Chairman, for giving IPC and its members the 
opportunity to express our concerns, and I will await questions 
at the conclusion of this panel.
    [Mr. McGuirk's statement may be found in the appendix.]
    Chairman Pence. Thank you, Mr. McGuirk.
    The Subcommittee will now hear from Jim Mallory, the 
Executive Director of the Non-Ferrous Founder's Society. He is 
a board member of the American Metal Casting Consortium and 
serves on an EPA compliance assistance advisory committee.
    We are grateful for his time and attendance. Mr. Mallory is 
recognized for five minutes.

  STATEMENT OF JAMES MALLORY, EXECUTIVE DIRECTOR, NON-FERROUS 
                       FOUNDERS' SOCIETY

    Mr. Mallory. Thank you, Mr. Chairman. Good morning, and 
good morning, Congressman Brady. I am very pleased to appear 
here this morning representing aluminum and brass and bronze 
foundries.
    I will let the importance of my industry be noted in the 
written comments that I have submitted, but let me just say 
that most of the people I am here to represent this morning are 
in fact small businesses. More than 50 percent of the non-
ferrous foundry industry employs fewer than 50 people. Most are 
family run businesses.
    Almost all of them are privately held, and in most cases in 
most foundries the person who is responsible for EPA reporting 
compliance is not a specialist or consultant, but is in fact 
the owner of the company, a family member or another principal 
executive of the company.
    Non-ferrous foundries have several specific problems in 
compliance with the new TRI reporting requirements. If I can, I 
would like to use my time this morning to just summarize 
briefly the written comments that delineate those problems.
    First of all, EPA's new TRI reporting rule has eliminated 
the de minimis exemption for TRI reporting. This fact alone 
will subject a number of non-ferrous foundries to the burdens 
of TRI reporting for the first time. Under the previous TRI 
rules, many of those companies fell within the purview of the 
de minimis exemption and, therefore, were exempt from the 
reporting requirement, but the burden and the elimination of 
the de minimis exemption occurs in that many foundries hold 
other state and federal permits that do not or shall I say that 
impose additional requirements once a company becomes subject 
to TRI reporting.
    For example, NPDES storm water permitting requires 
companies that are subject to TRI reporting to do the actual 
outflow of source reporting under their storm water permitting 
rules, so if you can imagine for a moment that you are a small 
business owner, it is Saturday night, it is raining and you are 
standing in your parking lot measuring the outflow of rainwater 
only because you have now become subject to the TRI reporting 
rule for lead.
    I think EPA ignored the domino effect that requiring a 
number of small businesses who have not previously been 
required to report to do so would have on the burdens that 
would be imposed.
    Secondly, TRI is not supposed to require facilities to 
generate new data or to do additional research. We have heard 
this morning that TRI allows people to use an estimate. The 
problem that most non-ferrous foundries have, and a lot of them 
aluminum foundries, is that there is no reliable source of data 
for the content of lead in the materials that they use, 
particularly in aluminum. I do not know if EPA was even aware 
that commercial aluminum alloys contain lead.
    I have brought with me this morning a publication that we 
produced that lists all of the chemical specifications for 
aluminum alloys. There are 80 pages with two alloys on a page. 
Not one of those alloys indicates the amount of lead present in 
an aluminum alloy, typically only in trace elements, but the 
TRI reporting rule is going to require foundries to estimate 
the amount of lead in those alloys. Most aluminum foundries do 
not just pour one alloy. They may pour several dozen different 
alloys depending upon customer requirements.
    Aluminum foundries are also, I think, somewhat arbitrarily 
subjected to this reporting requirement because within the TRI 
rule brass and bronze alloys and stainless steel alloys are 
exempt from inclusion in determining the threshold limit of the 
lead that they contain, even though the lead in those alloys 
exists in far higher quantities than it does in aluminum.
    I think EPA was ignorant of the fact that aluminum alloys 
contain lead, and I think that at a minimum the aluminum alloys 
should have received the same exemption that was accorded to 
brass and bronze and stainless steel.
    Lastly, to summarize my industry's problems with the rule, 
is the question of outreach. Most aluminum foundries, as I said 
before, have never had to file TRI reporting forms previously. 
Most were not sent copies of EPA's reports, were not informed 
of the hearings or the workshops that were being held on TRI 
reporting, did not receive copies of the guidance document and, 
frankly, even at this late date may be largely unaware of the 
fact that they are now subject to the reporting requirements 
for lead under the new TRI rule.
    Mr. Chairman and Mr. Congressman, I appreciate the 
opportunity to be here this morning, and I await questions at 
the conclusion of this panel.
    [Mr. Mallory's statement may be found in the appendix.]
    Chairman Pence. The Chair will now recognize a small 
business owner from Baltimore, Maryland, Nancy Klinefelter.
    Ms. Klinefelter. Correct.
    Chairman Pence. Ms. Klinefelter is president of Baltimore 
Glassware Decorators and also serves as a member of the board 
of the Society of Glass and Ceramic Decorators.
    As in the case of our last witness, we are especially 
grateful to be hearing from, for lack of a better term, ground 
zero of this type of a rule where it hits. I appreciated the 
passion of our last witness and recognize you for five minutes 
hopefully of the same.

STATEMENT OF NANCY KLINEFELTER, PRESIDENT, BALTIMORE GLASSWARE 
  DECORATORS, FOR THE SOCIETY OF GLASS AND CERAMIC DECORATORS

    Ms. Klinefelter. Thank you. I really appreciate the 
opportunity to be here today. Of course, you understand I am 
president of Baltimore Glassware Decorators, and it is a family 
operated business. Actually, my father has helped in growing 
the business, and he has been in this business for over 50 
years.
    We are a wholesale decorator, and we specialize in printing 
small quantities of custom glass and ceramic ware for special 
events, restaurants and for souvenir and novelty stores. As you 
see here in front of me, we do a number of glass and ceramic 
items for different government agencies.
    When we print mugs or glasses for our customers, we 
sometimes use lead bearing colors on outside surfaces. These 
colors become part of the glass after they are fired. These 
colors are expensive, and we only use what is needed to print 
each job, so very little ends up as waste.
    I am testifying today to point out major problems with 
EPA's new toxic release inventory lead rule. The greatest 
problem for my company, as well as other decorators, is the 
fact that EPA issued the rule April 17, 2001, and yet we are 
required to accurately report or account for lead usage from 
January 1, 2001.
    For my company, it is impossible to compile precise lead 
use records as required by EPA unless we track our color use on 
a daily basis. Since every color contains a different amount of 
lead, we must make different calculations for each color used.
    Companies such as mine cannot simply throw a switch and 
start to comply with the major environmental reporting rule 
overnight. Even when we were notified by SGCD that the rule had 
been imposed, we had no idea what it meant for the company. By 
the time we were able to review the reporting requirements and 
attend an SGCD seminar on the subject, half the reporting year 
had passed.
    As we began to compile the data, problems emerged. We buy 
decals from small decal printers. They have fewer than ten 
employees, yet these companies have to provide me with lead 
contentinformation so we can put it on the TRI report. These 
decal printers have no way of telling us how much lead is in each 
decal. We are still wrestling with this one, and the deadline is 
looming.
    We have no experience at all with TRI. Our lead usage is 
minimal. We were never anywhere near the previous 10,000 pound 
annual reporting threshold. Now we do estimate that we exceed 
the new 100 pound threshold, although just barely. Please note 
that this is a usage threshold, not an emissions threshold, as 
many in the media and others have indicated. We almost have 
zero emissions.
    For my company and every other small decorating shop, the 
most critical part of TRI compliance is tracking the lead 
usage. I do not know why EPA felt the need to make this a 
retroactive rule. It would seem only reasonable to issue rules 
in advance of when they must be applied, and that should have 
meant a January 1, 2002, start date. That would have given us 
adequate time to put a color tracking system in place. Would 
EPA not rather have accurate data than my best guess?
    It is not as though EPA usually issues rules this way. This 
is the first time in the history of the TRI program that EPA 
has imposed a retroactive reporting requirement, which we heard 
earlier. I know that EPA publishes estimates that say it will 
take 124 hours to track lead usage and complete TRI paperwork. 
That is already quite a large number, but it is a gross 
underestimate.
    I have spent already 95 hours trying to understand and read 
the TRI forms and requirements. I am still nowhere near the 
point where I can complete the forms with confidence. In 
addition, I have spent an additional 60 hours or more trying to 
reconstruct retroactive color usage data. We are now spending 
about four to five hours a week tracking lead usage. Like I 
said, we only have 15 employees. I do not have any 
environmental engineers, and I do not employ any, so the 
responsibility is mine.
    The time taken to reconstruct color usage data is time that 
is not spent managing my company or looking for new business. 
As we know, EPA has scads of paperwork you have to read. It is 
confusing. It provides little help in defining the calculations 
to determine the lead content of each color. The Try-Me 
software has been equally disappointing.
    In conclusion, I urge the Committee to ask EPA to postpone 
the TRI lead rule for one year to enable me and other small 
businesses to provide reliable and accurate information on our 
lead use. There is no other way for EPA to address my problems 
short of using a time machine to take us back to January 1, 
2001.
    I thank you for your interest and the concerns of a small 
business such as mine and for the opportunity to testify here 
before you today.
    [Ms. Klinefelter's statement may be found in the appendix.]
    Chairman Pence. Thank you, Ms. Klinefelter.
    Our final witness is Hugh Morrow, president of the North 
American office of the International Cadmium Association. His 
previous services includes time at the Westinghouse Bettis 
Atomic Power Laboratory in Pittsburgh, IIT Research Institute 
in Chicago and the Zinc Institute.
    He holds five patents related to high temperature alloys 
and cutting tool materials, has authored approximately 100 
publications and presentations mostly on cadmium zinc, received 
his undergraduate and graduate degrees in Metallurgy and 
Materials Sciences from MIT.
    We are grateful to have his expertise to close our panel 
today. Mr. Morrow is recognized for five minutes.

  STATEMENT OF HUGH MORROW, PRESIDENT, NORTH AMERICAN OFFICE, 
               INTERNATIONAL CADMIUM ASSOCIATION

    Mr. Morrow. Thank you, Chairman Pence and Congressman 
Brady. As the Chairman mentioned, I am the president of the 
North American office of the International Cadmium Association, 
which is an association of organizations and companies 
producing, using and recycling cadmium, both here in the United 
States and throughout the world.
    Cadmium is a key component of a number of important 
commercial and consumer products, including rechargeable and 
recyclable nickel cadmium batteries, which are used in cordless 
power tools and telephones, aircraft and railway applications, 
emergency lighting, and in remote area telecommunications.
    I appreciate the opportunity this morning to testify on the 
science aspects of the TRI lead rule that is the subject of 
this hearing. The scientific premise for this rule is that 
metals generally and lead and lead compounds in particular can 
appropriately be classified as persistent bioaccumulative and 
toxic or PBT chemicals using a methodology that was developed 
for application to pesticides and other synthetic organic 
compounds.
    For more than three years, I have been involved, along with 
numerous academics and representatives of all the major metal 
sectors, including copper, zinc, nickel and lead, as well as 
cadmium, in expressing scientific concerns with EPA's plan to 
apply its PBT methodology to metals.
    Those concerns are grounded in a solid body of peer 
reviewed scientific literature and the conclusions of 
international scientific experts that it is scientifically 
inappropriate to use the PBT criteria relied upon by EPA in 
order to asses the potential health and environmental hazards 
of metals.
    Enough concerns had been expressed, as the Chairman 
previous mentioned, by January of 2000 that EPA co-sponsored 
with industry an experts' workshop entitled ``Review of the 
State-of-the-Science Regarding PBT Concepts and Metals and 
Metal Compounds.'' The sessions of the workshop highlighted 
fundamental scientific problems with EPA's approach which 
industry hoped EPA would reconsider in the context of the TRI 
lead rule.
    It also became clear at the experts' workshop that no 
independent scientific peer review had been conducted of EPA's 
plan to apply the PBT criteria to metals, a serious deficiency 
that should not have been allowed to occur.
    These issues led the House Science Committee in a 
bipartisan letter signed by both the Committee and Subcommittee 
Chairmen and Ranking Members to write to EPA in July of 2000 
noting that, ``Questions have arisen regarding the scientific 
validity of applying the PBT criteria to metals and inorganic 
metal compounds and that this specific issue has not received 
the benefit of Science Advisory Board or other independent 
scientific peer review.''
    They went on to say, ``We strongly encourage EPA as soon as 
possible to refer for SAB review the issue of the scientific 
soundness of applying PBT concepts to metals,'' and a copy of 
that letter from the Science Committee is attached.
    Again, in November of 2000 when EPA had still not sought 
peer review, these concerns were echoed by the new Chairman of 
the Committee, Congressman Sherry Boehlert, who urged EPA, ``To 
charge the SAB to undertake a broad review of the use of PBT, 
which would include the applicability of PBT to all metals and 
inorganic metal compounds as to which questions have arisen.'' 
Again, a copy of that letter is attached to my testimony.
    The reasons for these concerns stem from the fact that PBT 
concepts were developed to assess hazard in synthetic organic 
compounds and do not work well, if at all, when applied to 
metalsand inorganic metals compounds. In critical ways, metals 
are fundamentally different from organics.
    Persistence, for example, may be a useful criterion for 
distinguishing among organic chemicals in terms of hazard, but 
all metals are deemed infinitely persistent under EPA's 
approach because, as naturally occurring elements, they cannot 
be destroyed. As we all learned in high school chemistry, 
elements are neither created nor destroyed and, therefore, are 
infinitely persistent.
    But, unless they are in a bioavailable form, this so-called 
``persistence'' is not an indicator of environmental hazard. As 
applied by EPA, it is not a meaningful measure of hazard in 
metals. Moreover, since all metals are considered equally 
persistent under EPA's approach, persistence provides no basis 
for distinguishing among metals in terms of hazard.
    In the same way, unlike the situation with organic 
chemicals, bioaccumulation or bioconcentration factors, which 
are commonly known as BAFs or BCFs, are not intrinsic 
properties of metals and do not provide useful indicators of 
hazard for them.
    In fact, there is strong evidence that a high BAF or BCF 
value for a metal would most likely indicate a lower risk of 
toxicity, the very opposite result from what EPA's PBT 
methodology assumes for organic chemicals and a very good 
reason why we would not want to use this approach to try and 
identify metals of greater concern.
    I am now happy to report that EPA has recognized the 
importance of these issues. In February, 2002, they announced 
that they were embarking on the development of a comprehensive 
cross-agency guidance for assessing the hazards and risks of 
metals and metals compounds and that the goal of this cross-
agency guidance will be to articulate a consistent approach for 
assessing the hazards and risks of metals and metal compounds 
based on application of all available data to a uniform and 
expanded characterization framework.
    Since February, the work has moved forward, and an SAB 
review schedule was recently announced that is expected to 
conclude by the end of 2003. Just last week, in a June 6 
notice, the SAB reiterated the connection between this 
development of metals assessment guidance and the questions 
raised during the TRI lead rule making.
    ``Discussions between the agency and external stakeholders, 
as well as concerns expressed formally as part of the Toxics 
Release Inventory lead rule making, have demonstrated the need 
for a more comprehensive cross-agency approach to metals 
assessments that can be applied to human health and ecological 
assessments.''
    EPA expects to release for public comment this week its 
draft action plan--I have already seen it on the internet; it 
is available now--for the development of this metals assessment 
framework. I, along with my colleagues in the metals industry, 
will be involved in submitting comments on this action plan.
    We applaud EPA's efforts to develop a scientifically sound 
metals assessment framework. We see this as a fulfillment of 
the commitment the agency made in the preamble to the final TRI 
lead rule in which it promised to ``seek external peer review 
from its Science Advisory Board'' on two issues. One, the 
question of whether lead and lead compounds should be 
classified as highly bioaccumulative, and, two, the issue of 
how lead and other as yet unclassified metals, such as cadmium, 
should be evaluated using the PBT chemical framework, including 
which types of data and which species are most suitable for 
these determinations.
    I might add here that to me the first question of the 
highly bioaccumulative nature of lead is really a subset of the 
second question. The second question is the one which should be 
logically answered first, and then you consider the second 
question.
    All of us who are interested in a sound, scientific 
approach to hazard assessment of metals and inorganic metal 
compounds look forward to EPA's and the SAB's responses to both 
these questions as the initiative to develop a cross-agency 
metals assessment framework review goes forward.
    Thank you for your attention, and I look forward to 
answering any questions you may have.
    [Mr. Morrow's statement may be found in the appendix.]
    Chairman Pence. Thank you, Mr. Morrow.
    The Chair will yield to the Ranking Member for the first 
questions for our panel.
    Mr. Brady. Thank you, Mr. Chairman.
    Mr. McGuirk, those forms are the forms that you now have to 
fill out?
    Mr. McGuirk. No. These are the reporting instructions, the 
guidance on what we need to fill out the forms. This is the 
clarification of how to fill out the forms.
    Mr. Brady. That is going to clarify something?
    Mr. McGuirk. Well, apparently.
    Mr. Brady. Do you know what the forms look like? I mean, do 
you have forms now that you have to fill out?
    Mr. McGuirk. There are TRI forms that have to be filled 
out, but the concern we have now is so many more have come 
under this TRI rule, and they have had no exposure to this 
whatsoever.
    As the lady was pointing out, they did not even know the 
rule existed until probably someone mentioned it to them and 
got their attention. Now they are trying to scramble to figure 
out how do we comply with this?
    Mr. Brady. Does anybody know what the TRI Form A is?
    Ms. Klinefelter. Yes. It is actually TRI Form R, which is 
for lead reporting. The actual form is not long at all. It is 
actually short, but it is what goes behind it that you have to 
have all these calculations upon calculations upon calculations 
in order to put down a number in a certain spot.
    The form itself is very unassuming. It is all the work that 
you have to do behind it.
    Mr. Brady. I just think that we want to protect everybody. 
We want to protect people, but I guess sometimes people make 
decisions that do not realize maybe the impact. The last thing 
we want to do is make a decision that does not protect people. 
I would like to make a decision that protects everybody.
    There are people out there that could get hurt by the lead 
or whatever toxic could come out of it. We also want to keep 
people in business. I can appreciate what you said that you do 
not have an engineer and would have to hire an engineer just to 
fill out forms or find out whether you are complying, you know.
    That is the only thing I am kind of concerned about and 
interested in and ready to follow my Chairman to track and find 
out where we are going to get to to try and solve this.
    Thank you, Mr. Chairman.
    Chairman Pence. Thank you. I would like to just ask one 
question of each member of the panel. It is this Subcommittee's 
intention to have listened to what we hear today, particularly 
from our colleague from the EPA, and then we would make a 
decision as to whether there is much more to be done here.
    Candidly, I think our minds are racing now with inherent 
contradictions built into this and the illogic of it. What the 
panel has said here has just been an extremely helpful 
commencement for what I can assure you the Subcommittee is 
going to be taking on in a very aggressive posture leaning 
forward.
    It strikes me that from our testimony that we have heard 
today even from the administrator from the EPA, the assistant 
administrator, that this was truly a ready-fire-aim situation. 
I intend to go back over the written testimony, but it seems to 
me that we heard from the EPA that well, we do not have the 
science. We are pretty sure it will be good. It might not.
    I guess I would just like a candid assessment from any of 
you. What did you think of Ms. Nelson's testimony today? Were 
you encouraged? Discouraged? Were there any aspects of her 
testimony that this Subcommittee should particularly focus on 
or representatives of the media that are in the room should be 
interested in?
    I will begin with Dr. Morrow.
    Mr. Morrow. Thank you, Mr. Chairman. I was a little bit 
concerned in her testimony about EPA and the SAB just 
considering the question of lead being highly bioaccumulative 
and being a little bit vague about considering the question of 
whether metals should be considered at all, and PBTs that is 
why I tried to emphasize the point in my testimony.
    To me, we should not even be considering the first question 
if the answer to the second question is no. If lead and other 
metals cannot be considered as PBTs, then there is no question. 
Why consider lead as a PBT if the PBT concept is inapplicable 
to metals? It is a metal. To me, that was the most disturbing 
part of EPA's testimony.
    Chairman Pence. Pardon me for interrupting, Doctor, but 
according to her testimony today I thought she averred that 
they are considering whether or not minerals should even be 
classified in this way; that that is a part of the potential 
new framework.
    Mr. Morrow. Yes. I got two sets of answers there. I felt a 
little ambiguous about exactly what she was saying. I know they 
are convening the SAB and that is going to move forward, but at 
the same time the TRI lead rule is moving forward, and it seems 
to me that it really should not be in place if its basis is in 
fact the concept that lead is a PBT.
    If lead is not a PBT, then clearly if they want to 
establish a different basis for the lead TRI rule that is 
another matter, or if they want to change the level and so 
forth that is another matter. The premise right now is lead is 
a PBT, and it seems to me that that is a fairly indefensible 
position.
    Chairman Pence. But unless the testimony suggests 
otherwise, it seems to me that question is being considered 
now, which was unclear prior to this Subcommittee hearing as to 
whether or not that was an issue being considered by the SAB at 
this time. It is being considered and is being reviewed.
    Ms. Klinefelter? Same question.
    Ms. Klinefelter. Thank you. I wanted to ask a question. If 
the EPA, and I forget her name. I am sorry. I am nervous.
    Chairman Pence. That is all right. Nelson.
    Ms. Klinefelter. Ms. Nelson. She mentioned something about 
the reporting for small businesses like mine. They are not 
looking for accurate data. Well, then my question is why file a 
report? I mean, if EPA does not want accurate data, then it is 
not worth the paper it is written on. I assume that that is 
what I got from her testimony or what she spoke about. I hope I 
am right.
    Right now, just to give you one for instance, when we 
screen print mugs or glassware we keep paint in the screen, and 
it is done, you know, by hand on a machine. They use rags to 
wipe out the screen, to clean it out for imprints. I use 
regular Scot rags in a box that you buy from Home Depot, any 
place like that.
    I am to a point right now where I had to weigh a rag with 
nothing on and weigh a rag that had some of the paint that they 
cleaned off, but I had to wait for the solvent to dissipate 
because that weighs part of it. Then I have to figure out what 
percentage in that rag is lead.
    I have to know this information, or I feel that I have to 
know this information, in order to make my numbers correct. I 
cannot guess. I am really between a rock and a hard place at 
the moment.
    Chairman Pence. Thank you.
    Mr. Mallory.
    Mr. Mallory. Yes. A couple of things came to mind as I was 
listening to the assistant administrator this morning. First of 
all, I heard her say on several occasions that this new TRI 
reporting rule would provide better information and more valid 
information to the local communities, to businesses and to the 
EPA.
    I really have a question as to how that can happen when the 
rule says that if you do not have actual numbers make one up. 
Use an estimate. Come up with your own presumptive quantity of 
how much lead is going to be in the alloys that we are using 
and the reporting, how to use that in our calculations and just 
document where you got the numbers from.
    Well, in the case of one of the alloys that we have tried 
to look at, we found that it can range anywhere from .1 percent 
lead to .5 percent lead in a range. Pick a number. Whatever 
number you are going to pick is going to be a supposition at 
best, and yet within the TRI rule it says that facilities are 
required to report their emissions to a level of accuracy of 
one-tenth of one pound.
    Now, I cannot correlate the two statements. One, if you do 
not have a good number, make one up. Two, report your levels of 
emission to a level of accuracy of one-tenth of one pound. 
Those two just do not gel in any assessment that I have been 
able to make of the reporting requirements.
    The second question that came to mind as I listened to the 
assistant administrator was when she was talking about the road 
test and the ``non-enforcement'' of the reporting for the first 
year that the rule is in effect, she made a statement this 
morning that said she was sure that no one within EPA was 
intending to seek enforcement actions against someone for 
erroneous reporting.
    I have a question of EPA. What about the people who still 
do not get it that they are required to report and in fact may 
not file a report because they are not aware of the reporting 
requirement? If an EPA inspector is on premise doing an 
inspection and finds that this facility should have filed a TRI 
report and did not, do they intend to waive enforcement in that 
case, as well as for inaccuracy reporting?
    I did not hear that from the administrator this morning, 
and that is a question that I think is one that needs to be 
answered.
    Chairman Pence. Mr. McGuirk?
    Mr. McGuirk. Thank you, sir. I agree with the comments of 
my colleagues here on the panel, and I would just like to sum 
up by saying that we believe that, you know, sound scientific 
data would be absolutely necessary before you are going to go 
out and collect information from small businesses. They need to 
have the information. They need to have the guidance on how to 
do this.
    For those who have not been exposed to it before, this is a 
significant burden to them. To make a rule that is retroactive 
where you are estimating or guesstimating or just filling in 
the blanks is absurd, so we would heartily recommend gathering 
the information on a sound scientific basis.
    Thank you.
    Chairman Pence. Thank you. To Mr. McGuirk and Mr. Mallory, 
thank you very much for your broad expertise. To Dr. Morrow, it 
is enormously helpful to have your authoritative voice here in 
the wake of some weird science. To Ms. Klinefelter, you did not 
seem nervous at all.
    Ms. Klinefelter. I was.
    Chairman Pence. I am very grateful for a very clear 
presentation----
    Ms. Klinefelter. Thank you.
    Chairman Pence [continuing]. Of what you are dealing with 
as a successful entrepreneur. It is really about businesses 
like yours, a family business of 50 years, that we are thinking 
now as we go through this process.
    Having only been in Congress a short period of time, I am 
growing more and more of the belief that we pay lip service to 
the people that employ America. We do not often put ourselves 
in your shoes and recognize what you are dealing with. This 
whole panel today has helped us on this Subcommittee now be 
able to do that more effectively.
    You can anticipate that this will be the first of a series 
of hearings and actions that we will take, and we urge you to 
keep this Subcommittee informed as this issue develops and 
alert us of ways that we can be helpful.
    It is our objective to either change the outcome, change 
the classifications or reorganize the timetable for enforcement 
here so that it simply has the least negative impact on small 
business America as possible, which is the broad mission of the 
Committee on Small Business in the House of Representatives.
    This meeting of the Subcommittee on Regulatory Reform and 
Oversight is adjourned, and we thank you.
    [Whereupon, at 12:15 p.m. the Subcommittee was adjourned.]
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