    [Senate Hearing 110-1184]
    [From the U.S. Government Publishing Office]

                                                           S. Hrg. 110-1184

                      S. 2045, THE CPSC REFORM ACT OF 2007

    =======================================================================

                                    HEARING

                                   before the

       SUBCOMMITTEE ON CONSUMER AFFAIRS, INSURANCE, AND AUTOMOTIVE SAFETY

                                     of the

                             COMMITTEE ON COMMERCE,
                          SCIENCE, AND TRANSPORTATION
                              UNITED STATES SENATE

                           ONE HUNDRED TENTH CONGRESS

                                 FIRST SESSION

                                   __________

                                OCTOBER 4, 2007

                                   __________

        Printed for the use of the Committee on Commerce, Science, and
                                 Transportation

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    20402-0001

           SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION

                           ONE HUNDRED TENTH CONGRESS

                                 FIRST SESSION

                       DANIEL K. INOUYE, Hawaii, Chairman
    JOHN D. ROCKEFELLER IV, West         TED STEVENS, Alaska, Vice Chairman
        Virginia                         JOHN McCAIN, Arizona
    JOHN F. KERRY, Massachusetts         TRENT LOTT, Mississippi
    BYRON L. DORGAN, North Dakota        KAY BAILEY HUTCHISON, Texas
    BARBARA BOXER, California            OLYMPIA J. SNOWE, Maine
    BILL NELSON, Florida                 GORDON H. SMITH, Oregon
    MARIA CANTWELL, Washington           JOHN ENSIGN, Nevada
    FRANK R. LAUTENBERG, New Jersey      JOHN E. SUNUNU, New Hampshire
    MARK PRYOR, Arkansas                 JIM DeMINT, South Carolina
    THOMAS R. CARPER, Delaware           DAVID VITTER, Louisiana
    CLAIRE McCASKILL, Missouri           JOHN THUNE, South Dakota
    AMY KLOBUCHAR, Minnesota
       Margaret L. Cummisky, Democratic Staff Director and Chief Counsel
    Lila Harper Helms, Democratic Deputy Staff Director and Policy Director
       Christine D. Kurth, Republican Staff Director and General Counsel
                      Paul Nagle, Republican Chief Counsel
                                     ------

       SUBCOMMITTEE ON CONSUMER AFFAIRS, INSURANCE, AND AUTOMOTIVE SAFETY

    MARK PRYOR, Arkansas, Chairman       JOHN E. SUNUNU, New Hampshire,
    JOHN D. ROCKEFELLER IV, West             Ranking
        Virginia                         JOHN McCAIN, Arizona
    BILL NELSON, Florida                 TRENT LOTT, Mississippi
    MARIA CANTWELL, Washington           OLYMPIA J. SNOWE, Maine
    FRANK R. LAUTENBERG, New Jersey      GORDON H. SMITH, Oregon
    THOMAS R. CARPER, Delaware           DAVID VITTER, Louisiana
    CLAIRE McCASKILL, Missouri           JOHN THUNE, South Dakota
    AMY KLOBUCHAR, Minnesota

                                C O N T E N T S

                                  ----------
                                                                       Page
    Hearing held on October 4, 2007..................................     1
    Statement of Senator Klobuchar...................................     9
    Statement of Senator McCaskill...................................    11
    Statement of Senator Nelson......................................    31
    Statement of Senator Pryor.......................................     1
        Letter from Sharon B. Winston, Technical Information
          Specialist, U.S. Consumer Product Safety Commission to the
          NHTSA......................................................    38
    Statement of Senator Sununu......................................     7

                                   Witnesses

    Durbin, Hon. Richard J., U.S. Senator from Illinois..............     1
    Korn, J.D. Alan, Director of Public Policy and General Counsel,
      Safe Kids USA..................................................    69
        Prepared statement...........................................    71
    McGuire, Joseph M., President, Association of Home Appliance
      Manufacturers; on behalf of the National Association of
      Manufacturers..................................................    76
        Prepared statement...........................................    78
    Mierzwinski, Edmund, Consumer Program Director, U.S. Public
      Interest Research Group........................................    42
        AB 706 Fact Sheet, dated August 27, 2007, entitled ``The
          Crystal Golden-Jefferson Furniture Safety and Fire
          Prevention Act''...........................................    47
        Article, dated November 19, 2006, from The New York Times
          entitled ``Chemical Burns''................................    54
        Article, dated October 12, 2007, from Science magazine
          entitled ``The Fire Retardant Dilemma''....................    55
        Letter, dated October 4, 2007, from William L. Hickerson,
          M.D., F.A.C.S., Burn Center at Arkansas Children's Hospital
          to Tate Heuer, Senior Legislative Assistant to Senator Mark
          Pryor......................................................    44
        Letter, dated October 18, 2007, from William L. Hickerson,
          M.D., F.A.C.S., Burn Center at Arkansas Children's Hospital
          to Senator Mark Pryor......................................    45
        Prepared statement...........................................    58
    Moore, Hon. Thomas H., Commissioner, U.S. Consumer Product Safety

      Commission.....................................................    17
        Prepared statement...........................................    18
    Nord, Hon. Nancy A., Acting Chairman, U.S. Consumer Product
      Safety
      Commission.....................................................    12
        Prepared statement...........................................    14
    Plunkett, Travis, Legislative Director, Consumer Federation of
      America........................................................    63
        Prepared statement...........................................    64
    Thompson, Al, Vice President, Global Supply Chain Policy, Retail
      Industry Leaders Association (RILA)............................    81
        Prepared statement...........................................    83

                                    Appendix

    American Academy of Pediatrics, prepared statement...............   104
    American Council on Electrical Safety (ACES), prepared statement.    99
    Article, dated October 4, 2007, from Consumers Union, entitled
      ``Consumers Union Urges Reforms for CPSC; Supports Provisions
      in `The Consumer Product Safety Reform Act of 2007' ''.........   100
    Boxer, Hon. Barbara, U.S. Senator from California, prepared
      statement......................................................    99
    Duke, Charles Jeffrey, General Counsel, Zippo Manufacturing
      Company,
      prepared statement.............................................   109
    Letter, dated October 23, 2007, from Friends of the Earth to Hon.
      Daniel K. Inouye...............................................   102
    Response to written questions submitted by Hon. Mark Pryor to:
        Alan Korn, J.D...............................................   118
        Joseph M. McGuire............................................   118
        Hon. Thomas H. Moore.........................................   111
        Travis Plunkett and Edmund Mierzwinski.......................   115
        Al Thompson..................................................   119

                      S. 2045, THE CPSC REFORM ACT OF 2007

                                  ----------

                           THURSDAY, OCTOBER 4, 2007

                                   U.S. Senate,
      Subcommittee on Consumer Affairs, Insurance, and
                                     Automotive Safety,
            Committee on Commerce, Science, and Transportation,
                                                        Washington, DC.
        The Subcommittee met, pursuant to notice, at 2:38 p.m. in
    room SR-253, Russell Senate Office Building, Hon. Mark Pryor,
    Chairman of the Subcommittee, presiding.

                 OPENING STATEMENT OF HON. MARK PRYOR,
                       U.S. SENATOR FROM ARKANSAS

        Senator Pryor. I want to thank everybody for being here and
    we have Senator Durbin here. I thought what I might do is
    acknowledge Senator Durbin, and then after he speaks, we may do
    our opening statements after that, to let Senator Durbin get
    back to his pressing scheduled needs.
        We all know that, in the Senate, Senator Durbin's the
    Assistant Majority Leader, but I think everyone around this
    table and on the Senate floor will tell you that the respect
    that we have for him is not just tied to his title, it's on his
    skills as a legislator.
        And I was in his home town of Chicago, or his home state,
    the big City of Chicago, not long ago, and I ran my own
    informal poll about what kind of job Senator Durbin's doing,
    and let me tell ya, he is loved in that State. Everyone I
    talked to was very, very pleased with him, and the leadership
    he provides for that State.
        Also, I need to note that early on this year, as Senator
    Sununu knows we--I talked to Senator Durbin along with some
    others about getting some more money for the Consumer Product
    Safety Commission. He was already way ahead of me, he was
    already on track to do that, and very, very supportive.
        And then he's had his own legislation to try to deal with
    toy issues and other things, along with some other Senators
    here we'll talk about in a few moments.
        But, Senator Durbin, thank you for being before the
    Committee today, and we're honored to have you. Go ahead.

                 STATEMENT OF HON. RICHARD J. DURBIN,
                       U.S. SENATOR FROM ILLINOIS

        Senator Durbin. Thank you very much, Mr. Chairman, and I'm
    glad you had a chance to meet my family in Chicago.
        [Laughter.]
        Senator Durbin. Senator Sununu, Thank you for being here,
    and Senator Klobuchar, your leadership, as well, on this issue,
    and for today's hearing on consumer products safety.
        Last month, my Financial Services ang General Government
    Appropriations Subcommittee held a hearing on the same topic, I
    was honored that, Mr. Chairman, you and Senator Klobuchar, as
    well as Senator Bill Nelson were able to join us at that
    important hearing. It's good to see the leaders on this issue
    working together on a bipartisan basis to address it.
        Let's face it: Our consumer product safety system is
    busted, and in need of major repair. The Consumer Product
    Safety Commission is operating under laws that are outdated, at
    funding levels that are unrealistic, and frankly has been
    unable to perform the most basic part of the mission that
    they've been assigned.
        Over the past several months, we have witnessed the recall
    of over 20 million defective toys, and other children's
    products. Just last week, the Chicago Tribune ran yet another
    series of investigative reports about a dangerous crib that was
    manufactured by a company known as Simplicity, Incorporated, of
    Reading, Pennsylvania.
        I've got some photos I hope the Members of the Committee
    can see, of what these cribs look like. If you'll notice, this
    crib railing broke away from the structure, and created a
    hazard which I'll just describe in a minute.
        These cribs were poorly designed. The drop rail on the side
    of the crib could detach from its plastic track, creating a gap
    between the crib and the rail. Children could fall into this
    gap, causing asphyxiation and serious injury.
        The flaw resulted in dozens of injuries, and the death of
    at least three young children. The first infant's death from
    this crib was reported to the Consumer Product Safety
    Commission in April of 2005. Yet, there was a delay of nearly
    two and a half years between that incident and the recall of
    this product.
        During this period of time, two more children died, and
    hundreds of thousands of faulty cribs were purchased and
    installed in homes across America. Interviews and records in
    the Tribune's story show that the Federal investigator assigned
    to investigate the April 2005 death, failed to inspect the crib
    in his initial inquiry, and didn't track down the model or
    manufacturer.
        According to the investigator, and I quote, ``We get so
    many cases, once I do a report, I send it in, and that's it. I
    go on to the next case. We could spend more time, but we are
    under the gun, we have to move on.''
        Only after inquiries by this newspaper did the investigator
    return to California to find the crib that caused the death. It
    had been held as evidence by the Sheriff's Department, and
    later put in storage by a lawyer retained by the family.
        Now, last month in my home State, our State Attorney
    General Lisa Madigan, wrote to the crib company, posing as a
    consumer who had purchased on of these faulty cribs. In
    response to her complaint, the company sent an envelope with 8
    pieces of plastic hardware, without any instructions or
    explanations. This is unacceptable.
        Like the Magnetix toy recall of April 2007, the crib
    recalls were only announced following the hard work of
    investigating journalists. I want to recognize the efforts of
    two, in particular--Patricia Callahan and Maurice Posely--in
    bringing these cases to the public's attention and spurring the
    Consumer Product Safety Commission to act.
        However, it is inexcusable for us, representing this great
    nation and this great government to have to rely on
    enterprising journalists to make certain that our agencies are
    doing their job.
        Last week, I wrote to the Commission, asking them for a
    detailed report and timeline on what happened in this deadly
    case. An infant died. It took two and a half years before the
    product was recalled, and in that span, another two children
    died.
        If the death of an infant does not set off the alarm bells
    at the Consumer Product Safety Commission, what will?
        This is the kind of thing that, I think, causes concern
    among families across America--uncertain about what toys are
    safe for Christmas? What crib should I buy for my new baby?
    They trust us. They think if these products are for sale in our
    stores, surely someone in our government has taken a look at
    them. They must be safe.
        Well, sadly, because of inadequate laws, inappropriate
    funding and lack of response, we can't answer affirmatively
    when it comes to that request from our constituents across
    America.
        What these recalls revealed is the Consumer Product Safety
    Commission needs to change. Congress is taking steps necessary,
    in terms of increasing its budget. As the Chairman noted, I am
    Chairman of the Financial Services and General Government
    Subcommittee that is going to increase the funding for the
    Consumer Product Safety Commission.
        I'm sorry I can't put more money in that Commission. I
    definitely want to make sure that they have more inspectors,
    better laboratories. That they can respond more quickly, in a
    timely fashion, to give American families peace of mind.
        This is an indication of what's been happening here. You
    can see from this chart, the bar graph, the increase in imports
    into the United States, and then take a look at the dotted red
    line, how the staffing at the Consumer Product Safety
    Commission has been in decline, dramatically, and leveled off
    over the last several years.
        Since its inception in 1973, the staffing at this
    Commission has decreased by almost 60 percent, from a high of
    978 employees, to a low of 401, currently. The lab facilities
    are incredible. It is hard to imagine that this is what America
    has to offer to test the safety of products being sold to our
    families.
        What you're looking at here, as I said in my earlier
    hearing, may look like my basement, but in fact, it happens to
    be one of the laboratory facilities of the Consumer Product
    Safety Commission where it investigates toys. Take a look at
    that, and tell me if that builds confidence in the work that's
    being done.
        Now take a look at the drop test site, which we showed in
    the Committee, as well. This is how toys are tested, to see if
    you drop them, whether they'll fall apart. This--Bob, I think
    is his name--is probably a good, hardworking employee, look
    what he has to work with. Two lines drawn on a wall. They hold
    the toys up to these lines and drop them to see what happens.
    This is our scientific testing of products being sold to
    families across America for our children to use. This is
    absolutely unacceptable.
        We have to change it, I hope the Appropriations Committee
    will start us on this track, but there's more to be done.
        Mr. Chairman, I want to salute you, because you and I have
    talked about this for quite awhile. You had some great ideas, I
    had a bill, you said, ``I'll sit down with you and see what we
    can do to bring that bill into our plans for reauthorization.''
    I'm very satisfied with what you did. I think that at the end
    of the day, bringing these two bills together is going to
    create an even stronger legislative product that will get the
    job done.
        The Consumer Product Safety Commission is currently
    required in Section 6(b) of the statute to give firms a 30-day
    window before reporting hazards to the public. Because of this
    requirement, at times, the CPSC cannot act quickly to protect
    human health. That isn't there fault, that's the statute.
        In addition, the maximum fine the CPSC can levy has not
    been updated for a long time. One of their enforcement tools
    can be shrugged off now as just the cost of doing business.
        Thankfully, Chairman Pryor, you've done great work in
    crafting your comprehensive package of proposals in your Reform
    Act. I want to thank you Senator Klobuchar, Senator Nelson, and
    Senator Sununu for that effort. This will significantly--your
    bill--will significantly increase the funding level for the
    next 7 years, will allow the CPSC to increase its staff level,
    update its information technology systems, and improve--I
    shouldn't say improve--create a lab facility.
        This bill would reduce the time lag under section 6(b) to
    15 days, and allow the CPSC to share information with
    government authorities. It would also create a third-party
    requirement that all children's products be tested or
    credentialed at labs, and that we have the lowered lead
    threshold from 600 parts per million to 90 parts per million.
        I might add that Senator Nelson--also a Member of your
    Committee--and I have a bill that would require the testing of
    products used by children under the age of 6--whether they're
    toys or cribs--anything, seats for automobiles that kids might
    be using.
        This bill would also strengthen your enforcement
    capabilities, increasing maximum fines, and making it illegal
    to sell recalled products. Last, it would expedite recalls, by
    requiring durable markings on children's products--a great
    idea.
        Combined with increased funding, this is a package of
    proposals that can make it less likely for us to worry about
    delaying recalls of consumer goods that are threatening our
    families' children. I support this set of proposals.
        The stories of recent months have really raised, in my
    mind, a fundamental question as to whether or not this
    Commission--even given new resources and new authority--has the
    will to make a difference. I hope they do. We're counting on
    them. Families across America are counting on them.
        Funding and authorities can't solve this most fundamental
    issue. It can only come from the determination of the people
    who work at the Consumer Product Safety Commission.
        I thank you for allowing me to make this opening statement.
    Happy to answer any questions, or let you proceed with your
    hearing.
        Senator Pryor. Do you have any questions? Do you have any
    questions?
        Thank you.
        Senator Durbin. Thank you very much.
        Senator Pryor. Senator, we appreciate you being here today.
    Thank you very much.
        What I'd like to do now is go ahead with our opening
    statement portion of the hearing and welcome everyone. Thank
    you to everyone for being here. We know everybody's busy. We
    know that product safety issues have become a very prominent
    issue in the American media. Given the number of recalls and
    the attention that people are placing on it now, I think that
    the people in this country expect us, Congress--the House and
    Senate--to take action on this.
        I do want to say though, before we get started, I want to
    be very clear about this; I want to thank industry, because
    many industries--whether it be individual companies, or
    industries generally--have taken steps and they've been trying
    to be proactive and trying to deal with the situation as it
    exists today. And certainly I appreciate your efforts. Your
    work has not gone unnoticed.
        But, I think that we all agree that we all need to work
    together to strengthen product safety in this country. I would
    hope that today's hearing would be--not necessarily the start
    of, because we've been talking about this for awhile now--but
    part of a constructive dialogue on this issue, and a dialogue
    that leads to legislation, and more specifically, that leads to
    a reauthorization of the Consumer Product Safety Commission.
        I'd like everybody to know who's here, that now is the time
    to let your voice be heard. Even if you're not a witness today,
    certainly, I encourage you, and all Senators encourage you to
    come in to our offices and talk to us about these issues that
    are in this bill. We need to hear from you now, because, we
    would like to move some legislation through the Senate this
    year.
        I know that I personally, and my staff, and the Commerce
    Committee staff, and probably other Senators and their staffs,
    as well, have sat down with many companies, industries, and
    groups to talk about this legislation--some before the
    legislation was drafted, some while it was drafted, some after
    its been drafted--just a continuing discussion about it.
        But many of those groups have been talking about concepts.
    We need to move from the concept to the concrete. We would like
    to have your ideas. If you want to have a role in shaping this,
    certainly we encourage you to come and see us, very, very soon,
    and talk about what you want to see in this legislation.
        And also, let me say, and I know that the other Senators
    would say the same thing, given the chance, that on a bill like
    this, please understand, no one is going to be 100 percent
    happy. No one's going to get every single thing they want.
    We're going to try to have a bill that has balance to it. We'd
    love to get a bipartisan bill, and quite frankly, we'd like to
    get a bill that we can get 60 votes on, in the U.S. Senate.
        So, I know I have my work cut out for me, and other Members
    of this Committee and the Senate does, as well.
        The focus here today is the Consumer Product Safety
    Commission. Most Americans, if you were to ask them, what does
    CPSC stand for? They probably don't have any idea, and they
    probably don't have any idea what it does. And, as a
    confession, let me say that, I didn't really know what the CPSC
    did until I was elected as Attorney General of my State.
        It became very clear, very quickly, how important the CPSC
    is when it comes to making sure our products are safe in the
    American marketplace.
        Then, I must say, that when I came to the Senate, I was
    shocked at how under-resourced the CPSC is and how it's been
    allowed to wither on the vine over the last few years. I'm not
    pointing fingers, I'm not saying one Administration or one
    Congress, one Party--I don't want to get into any of that right
    now--but the reality is that we see an agency that, in my view,
    is in distress, and an agency that needs comprehensive reform.
        That's the goal of this legislation--to have comprehensive
    reform. We're not trying to just throw money at a problem and
    hope that the problem goes away. We're actually trying to
    restructure and reshape and retool the Consumer Product Safety
    Commission so that it's prepared to meet the demands and the
    challenges in the 21st century marketplace.
        So, let me just cover four broad topics that are in the
    legislation. Before I do, I want to thank Senator Durbin,
    Senator Bill Nelson and Senator Klobuchar, for their
    cosponsorship. They've really gone the extra mile on this
    legislation, and I appreciate it and we're trying to reach out
    to other Senators right now to try to get their thoughts, and
    hopefully, maybe get some cosponsors on--more cosponsors on
    both sides of the aisle.
        But, let me say, again, I recognize that, from my
    standpoint, at least, the Consumer Product Safety Commission is
    an agency that has been overwhelmed by the changes in our
    economy, and the changes to that agency. There are now 15,000
    consumer products in the marketplace that the CPSC regulates.
    In addition, there are a number of emerging technologies, like
    nanotechnology that, in my view, and if I talk to the CPSC
    people they'll tell us--that the CPSC is not really equipped to
    handle the emerging technology.
        Senator Durbin showed a chart there a few moments ago that
    talked about the employee downward slide at the CPSC. President
    Bush has recommended further budget cuts. I just don't think we
    can expect this overburdened agency to prevent dangerous
    products from entering the shelves, and entering the
    marketplace here, if we continue to see cuts in the agency.
        So, to address this, we're trying to ramp up the funding
    for this agency over a 7-year period, about 10 percent a year.
    That doesn't get us back to the 900 employees that the agency
    used to have, it only gets us back to 500 employees. But we
    think, given today's technology, and just changing
    circumstances, we think--we hope--that the 500 employees will
    be sufficient to do the job.
        We also want to make sure that we have the proper
    checkpoints at our ports and also that the testing facilities
    that the CPSC has are adequate.
        Another part of the bill would be improving safety in
    children's products, specifically, again--a lot of news media
    attention on this. The CPSC does much, much more than just
    children's products, but that's been where a lot of the news
    attention has been recently.
        One thing we want to say in this legislation very clearly
    is that lead in children's products is unacceptable and the
    bill contains an outright ban on lead in children's products.
    There is an allowance for some trace amounts here and there. We
    can talk about that in a few minutes. But also, in addition to
    just the children's products, and the lead, this bill would set
    up a government-certified, third-party system to test
    children's products, to make sure they comply with U.S.
    standards.
        Also, there's a process where the Consumer Product Safety
    Commission could give some sort of certificate where a product
    could be stamped on the package, for example, that shows that
    it does meet all U.S. safety standards.
        Another thing that we do in the bill is we enhance the
    penalties and we really try to go after the bad actors and the
    unscrupulous importers. In fact, I think we've heard some
    people say, maybe anecdotally, but I think the CPSC has some
    record on this, as well, that some of the lower fines that the
    CPSC can give, basically have just become a cost of doing
    business for some of these importers and for some of these
    people who are allowing these dangerous products to come into
    the marketplace.
        What we want to do with the fining authority and the
    penalty authority, is to put the Consumer Product Safety
    Commission on par with other Federal agencies, and give them
    some teeth, and even some criminal authority under some narrow
    circumstances, to go after the repeat offenders and the bad
    actors, when the circumstances call for that. We want to
    enhance the recall effectiveness. Senator Durbin gave us an
    example of a product that took way too long to be recalled. We
    want to streamline, and help strengthen, the rulemaking process
    over there, and--this is just touching the highlights of some
    of the things we want to try to do in this legislation.
        Last thing I want to say before I turn it over to Senator
    Sununu--I want to thank him for his leadership on this
    Subcommittee and just being generally concerned about this
    issue, as well, like the rest of us have been. And also, I just
    want to again, tell the audience that we really are hoping to
    have some quick Committee action on this legislation. So, just
    want to put you on notice that it's time to come in and talk to
    us about any changes or any recommendations you might have in
    the legislation.
        Senator Sununu?

                   STATEMENT OF HON. JOHN E. SUNUNU,
                    U.S. SENATOR FROM NEW HAMPSHIRE

        Senator Sununu. Thank you very much, Mr. Chairman, and
    thank you to the witnesses we're going to hear from today. This
    is obviously a very important subject, the Consumer Product
    Safety Commission has a tremendous responsibility dealing with
    an incredible range of products, and making sure that hazardous
    products are taken off the shelves, and obviously with regard
    to the recent recalls in children's toys, making sure that the
    toys that kids play with are safe and can be trusted, and that,
    when there's a problem, it's dealt with swiftly and
    effectively.
        Senator Durbin asked--perhaps rhetorically--in his
    statement, whether or not the Consumer Product Safety
    Commission has the will to deal with this problem. At the
    outset, I want to state that my experience is that they do have
    the will to deal with the problem. I think the men and women at
    the Commission are hardworking and conscientious.
        The two Commissioners here today, Commissioner Nord and
    Commissioner Moore--with whom I and my office have dealt with--
    I think have worked very hard and put a tremendous amount of
    time and energy into their work. While there's a clear need for
    some changes, improvements and additional powers to be put into
    their hands--Chairman Pryor mentioned the issue of fines and
    penalties, getting rid of lead paint and the like--I think the
    men and women at the Commission have worked very hard, and this
    year under particularly tough circumstances, with a tremendous
    number of recalls, driven in part by continued growth in
    imports from China and other parts of the world.
        I hope that we don't question the ethic and the commitment
    of those men and women who are responsible, at the end of the
    day, for ensuring the safety of these products, and that we
    work to give them the resources they need.
        I think it's extremely important, as we look at these
    issues and try to improve the statutes and the regulations
    under which the Commission operates, that we try to get the
    balance right, and that we look to find those approaches that
    have the broadest support and that we can be most certain will
    improve the situation.
        As a couple of examples, we can talk about penalties and
    fines--they clearly need to be increased. We absolutely need
    civil penalties and fines such that the punishment fits the
    crime.
        But, we have also benefited historically from a fairly high
    level of cooperation on the part of firms whose products are
    recalled. We want to maintain the highest potential level of
    cooperation, because that means that actions are taken faster,
    more efficiently, and more effectively, when there's a problem.
    If we create a system that encourages the maximum amount of
    litigation, and the maximum amount of confrontation, we run the
    risk of undermining a lot of the cooperation that has
    historically existed.
        So, we want stronger penalties. We need stronger penalties.
    But we want to make sure that we also maintain incentives for a
    cooperative approach wherever possible.
        We want to benefit from the strength and the experience
    that Attorneys General can bring to this effort. They deal with
    consumer fraud, they deal with issues of safety and consumer
    protection every day.
        But at the same time, we need to make sure that we have as
    clear and consistent a set of laws as possible. If every state
    were to take a different approach to consumer safety or
    consumer products or recalls or liability or litigation, then
    we're going to create a system that's confusing, and not just
    confusing and costly for businesses, but confusing for
    consumers. And that carries with it some real, real risks.
        It is true that we can't have a bill where everyone gets
    100 percent of what they want. But we can have a bill where
    just about everyone agrees, everything in the bill improves the
    current situation, improves the framework, improves the
    regulations, improves the power of the Consumer Product Safety
    Commission in a positive way.
        I think that's what we should strive for. I think we should
    listen very carefully to the Commission members themselves,
    because they've had to work under pressure, under the
    challenges of understaffing, under the challenges of under-
    funding--and I think they have good ideas about how to improve
    the Commission itself. I think we should work very hard to
    identify those areas of consensus, and then based on that
    information, act in as timely and deliberate a fashion as we
    can.
        I look forward to doing that. As you know, Mr. Chairman,
    we--unfortunately--didn't really have a lot of time to review
    the legislation before it was introduced. And that was a little
    disappointing, and a little problematic, but I think there's a
    lot of opportunity to work going forward, and try to strengthen
    the legislation--bring in as many people from both sides of the
    aisle as possible and listen to their recommendations. I think
    at the end of the day that will be how good legislation is
    finally produced.
        Thank you very much.
        Senator Pryor. Senator Klobuchar?

                   STATEMENT OF HON. AMY KLOBUCHAR,
                      U.S. SENATOR FROM MINNESOTA

        Senator Klobuchar. Thank you, Senator Pryor, and Senator
    Sununu for your leadership on this Subcommittee, and thank you
    Senator Pryor for holding this hearing.
        I think as everyone knows, this has been the summer and the
    fall of recalls. It seems like every day for the past 4 months,
    when you open up the paper you hear that another toy or
    children's product has been recalled.
        As a mother and a former prosecutor, I find it totally
    unacceptable that these toys are continuing to get into the
    hands of our children, and it shouldn't be happening in this
    day and age.
        As my 12-year-old daughter said--she was very uninterested
    in this issue when it was regarding Spongebob Squarepants, and
    the Thomas the Train set, but as she said when the Barbies came
    up, ``Mom, this is getting serious.''
        One of the first products recalled this summer as a result
    of lead paint was the Thomas and Friends train, like the one
    that I have right here, 1.5 million of which were recalled. The
    RC2 Corporation, as everyone knows who has been following this
    issue, apologized to the customers, and said it would make
    every effort to ensure that this wouldn't happen again, and to
    encourage customer loyalty, and to prompt its customers to send
    in the trains, RC2 offered customers returning trains a bonus
    gift for their troubles.
        Well, the bonus gift backfired in a big way. Just last
    week, it was discovered that 2,000 of these bonus gift trains
    contained lead paint levels four times higher than legally
    allowed, leaving parents of toddlers across the Nation to deal
    with a double recall.
        As a result of this, and approximately 20 million other
    toys that have been recalled, American consumers are losing
    faith and losing confidence in the toys they can purchase in
    the stores. And, as we have watched this recall process unfold
    this summer, everyone has been enlightened to learn of the lack
    of resources, which Senator Durbin and Senator Pryor discussed
    at the Consumer Product Safety Commission.
        In total, the Consumer Product Safety Commission has only
    about 100 field investigators and compliance personnel
    nationwide. Even worse, we now know from the photos and the
    visits of our staff, that they have only one toy inspector--
    Bob, the small parts guy--who is going to be retiring at the
    end of the year.
        It is time for us to act. And I appreciate the work of
    Commissioners Nord and Moore. They have educated us on how the
    Commission can be modernized, and I thank Senator Pryor for
    working with all of us to put together this bill.
        I also thank the companies that we have been working with
    in Minnesota, Target and Toys `R' Us, for their input, and
    they've been very forthcoming.
        And I am also pleased to report that this legislation that
    Senator Pryor has put together contains two of the more
    important pieces of legislation that I introduced, that makes
    it easier to identify recalled products and illegal to sell
    them, and also the lead ban that Senator Pryor discussed.
        And the need for this ban, tragically, struck at home for
    our people, when a little 4-year old boy named Jarnelle Brown
    died after swallowing a heart, a little charm that he got with
    a pair of tennis shoes. He didn't buy the charm, it was given
    to him as a little bonus gift with the tennis shoes, and he
    swallowed it. And he didn't die from choking. He didn't die
    from inhaling that charm. He died over a series of days as the
    lead crept into his bloodstream. He should never have had
    access to that toy in the first place, and it was made in
    China. And when they tested it in Minnesota, it was 99 percent
    lead.
        The first piece of legislation that I introduced that's
    included in this bill is that lead ban. And, I think it's hard
    for people to believe that we don't have a Federal lead ban
    now. We have guidance, a voluntary guideline. What we did is we
    took that guideline, and looked at other guidelines with the
    understanding that there is trace lead in products, and set it
    at .04 parts per million for jewelry, lower .02, which is the
    standard they're going to be using in California next year, and
    we've made some other exceptions, as well, for batteries and
    other things.
        The second piece of legislation which I think is really
    important to the parents across the country is that they know
    what products they're dealing with. When they look at their
    kids' toy boxes, and they see all of these toys, and they're
    supposed to figure out when they bought it, and a date, and a
    batch number--unless you're my mother-in-law, no one keeps the
    packaging from the toys.
        And, one of the things that I'd like to see improved in
    this legislation, is to make sure that we require that the
    numbers and the batch numbers be actually printed on the toy.
    Obviously you're not going to be able to do it with pick-up
    sticks and things like that, but for most toys, you're going to
    be able to write a date and a batch number at the bottom. And I
    think it should be very clear, so that parents can easily look
    at this.
        The other thing you need to do is to have it on the
    packaging. Because unlike some of our major retailers like
    Target or Wal-Mart, a lot of the Mom and Pop operations, or
    when things are sold on eBay, they're not able to identify in
    their computer system when something's recalled. And, it would
    also be good to have it on the packaging for retailers, only.
    Obviously, the parents are going to need it on the toys
    themselves.
        So, those are our practical solutions. We look forward to
    working with Senator Pryor and the rest of this Committee on
    something--the time has come. It's time to act, and I'm hopeful
    we're going to get this legislation through this Subcommittee.
        Thank you very much, Mr. Chairman.
        Senator Pryor. Senator McCaskill?

                  STATEMENT OF HON. CLAIRE McCASKILL,
                       U.S. SENATOR FROM MISSOURI

        Senator McCaskill. Thank you, Senator Pryor. I will
    hopefully have an opportunity to ask some questions.
        But, when all of this surfaced, the first question I had
    was, where is the Inspector General at the Consumer Product
    Safety Commission? So, I did what you would think most
    consumers would do, if they wanted to contact a government
    agency, I went to the Internet. And I was surprised when I
    learned that there was no website in existence for the
    Inspector General at the Consumer Product Safety Commission.
        Now, you may not think this is startling, until you realize
    there are only three Inspector Generals in the entire Federal
    Government that don't have websites. The other two are the
    Capitol Police, and the CIA. I don't think either one of their
    missions have to do with helping consumers.
        So, I asked a series of questions of the IG, and I don't
    mean to pick on the Inspector General--but all of these
    problems are things that should have been discovered by an
    Inspector General and reported by an Inspector General--whether
    it's staff morale, or whether it's the failure to have adequate
    staff to do the work, whether it's the inadequacies of the
    testing facilities, or even the unbelievable fact, to me, that
    we negotiate recalls. The products should be recalled, we
    should recall them. There should be no negotiation. That's
    negotiating something that has to do with the safety of the
    American consuming public.
        I received a lengthy response from the Inspector General,
    and I must say that I now understand why the Inspector General
    at the Consumer Product Safety Commission is very ineffective--
    there are only two people there. This is a huge responsibility
    to have a budget of only $200,000 and a staff of a total of
    three.
        If you look at what they're supposed to be doing--now, I'm
    not saying it should be like the Department of Defense, where
    we've got 20,000 people that work in the area of oversight and
    accountability, but certainly we could do better, I think, than
    two.
        And so, I think this legislation, and the attention that
    this problem is getting is incredibly important, and I thank
    you Senator Pryor for doing this today.
        I will say that, the irony of it being Thomas the Train is
    not lost on any of us that are mothers, because, I remember
    thinking with some kind of self-satisfaction that buying Thomas
    the Train toys was getting back to basics. There are no motors,
    there are no parts that come apart, there's nothing to put
    together--it's a wooden track and a simple rolling train, and
    my kids loved them.
        They're embarrassed I'm talking about this, because they're
    too old now to admit that they ever liked Thomas the Train,
    that went between the Transformers and the Teenage Mutant Ninja
    Turtles with all the swords and stuff. I always went for Thomas
    the Train. So, imagine how disappointing it is to parents
    across the country who thought they were doing the right thing,
    and the safe thing, as it turned out, no one's minding the
    store for safety. We must do better. I think the American
    public deserves it, and frankly, I think they ought to demand
    it.
        Thank you, Mr. Chairman.
        Senator Pryor. Thank you.
        I'd like to ask our two Commissioners to come up and take
    your seats at the table, please.
        First we're going to have the acting Chairman of the U.S.
    Consumer Product Safety Commission, the Honorable Nancy A.
    Nord, and then we'll have the Honorable Thomas H. Moore, who's
    also a Commissioner on the Consumer Product Safety Commission.
        So, again, we want to welcome you all, and as you're taking
    your seats, let me correct an oversight a few moments ago. I
    mentioned the cosponsors of the bill, but I forgot the most
    important one, who is Senator Inouye. Senator Inouye is an
    original cosponsor, and I accidentally--I know, I
    accidentally----
        Senator McCaskill. Whoops.
        Senator Pryor.--left out the Chairman.
        [Laughter.]
        Senator Pryor. But, anyway, thank you all for being here,
    and Chairwoman Nord, if you'd like to go ahead and start, we'd
    love to hear from you. Thank you.

    STATEMENT OF HON. NANCY A. NORD, ACTING CHAIRMAN, U.S. CONSUMER
                       PRODUCT SAFETY COMMISSION

        Ms. Nord. Thank you, Mr. Chairman, Members of the
    Committee. I really very much appreciate the opportunity to
    testify today on S. 2045, and I want to thank the Committee for
    your interest in, and support of the safety mission of the
    CPSC.
        No small amount of work went into the crafting of the
    original legislation establishing the CPSC 35 years ago.
    Congress's thoughtful deliberations, hard work, and keen
    foresightedness resulted in the creation of an agency that has
    contributed substantially to the decline in the rates of death
    and injury related to the use of consumer products.
        The dynamics of the marketplace have changed dramatically
    since then, and it's important to move forward in modernizing
    this Agency. But, it's also important to do so, recognizing
    that the statutory foundation on which the Agency was built, is
    fundamentally a strong one.
        In moving forward, it's important to understand the
    rationale and common sense behind the original legislation, and
    the subsequent reauthorizations that underpin the most
    effective product safety system in the world.
        Since being appointed to the Commission two years ago, and
    subsequently being named Acting Chairman last year, I've
    closely studied, enforced, and directed the implementation of
    CPSC's statutes that we enforce.
        Based on this working experience, earlier this year I
    submitted to the Congress a comprehensive list of legislative
    proposals, the Product Recall Information and Safety
    Modernization Act, or PRISM, that would strengthen the
    Commission's hand in enforcing our laws and protecting the
    American public from unsafe products.
        I'm pleased to see a number of my proposals from PRISM
    included in the Chairman's bill that we're discussing today.
    For example, the bill adds asset forfeitures as a potential
    nd the
    rationale and common sense behind the original legislation, and
    the subsequent reauthorizations that underpin the most
    effective product safety system in the world.
        Since being appointed to the Commission two years ago, and
    subsequently being named Acting Chairman last year, I've
    closely studied, enforced, and directed the implementation of
    CPSC's statutes that we enforce.
        Based on this working experience, earlier this year I
    submitted to the Congress a comprehensive list of legislative
    proposals, the Product Recall Information and Safety
    Modernization Act, or PRISM, that would strengthen the
    Commission's hand in enforcing our laws and protecting the
    American public from unsafe products.
        I'm pleased to see a number of my proposals from PRISM
    included in the Chairman's bill that we're discussing today.
    For example, the bill adds asset forfeitures as a potential
     Mr. Moore follows:]

           Prepared Statement of Hon. Thomas H. Moore, Commissioner,
                    U.S. Consumer Product Safety Commission
        Mr. Chairman, Mr. Ranking Member, and Members of the Subcommittee,
    I appreciate the opportunity to appear before you today to provide
    testimony on S. 2045, legislation to reform and reauthorize the United
    States Consumer Product Safety Commission (CPSC). The Commission is
    charged by Congress with the critical responsibility of protecting the
    public against unreasonable risk of injury and death associated with
    consumer products. This is now, and has always been, a very crucial
    responsibility because, often without CPSC's intervention, the
    consequences of exposure to the hazards associated with dangerous
    products may literally be of a life or death nature for individual
    consumers unknowingly in possession of unsafe consumer products.
    Is it Safe?
        The question that many American consumers will be asking during
    ection (b)--Criminal Penalties
        I support removing the requirement in the CPSA that there has to be
    a notice of noncompliance received by the company from the Commission
    before a criminal penalty can be imposed for a violation of section 19.
    This has been an impediment to the Justice Department's ability to
    pursue criminal sanctions on the agency's behalf.
        The two-tier criminal penalty system laid out in the bill is
    similar to one that the Justice Department has indicated we should have
    and since they actually prosecute our criminal cases, I would bow to
    their assessment that they think such a system is needed. It might be
    helpful if the bill provided some guidance as to the meaning of
    ``knowing'' and ``willful'' in the criminal penalty provisions.
        I also support the two-tier system in the FHSA. I do note that
    while it increases the penalties, it does add a ``knowing'' requirement
    to the first tier offenses that does not currently exist. Given the
    increase in the penalty amount, and the desirability of harmonizing the
    criminal penalties with that of the CPSA, that may be an appropriate
    change.
        I do not know why there are no criminal penalties under the
    Flammable Fabrics Act, but considering that children's sleepwear,
    mattresses, and upholstered furniture are regulated (or may potentially
    be regulated) under this statute, Congress might want to consider
    including the same criminal sanctions in that statute as are contained
    in the CPSA and the FHSA.
        I also support having the additional criminal penalty of requiring
    a company to forfeit any assets associated with a violation of our
    statutes. All of these provisions will greatly strengthen the agency's
    hand in criminal cases and put real teeth in our enforcement abilities.
    Section 18: Preemption
        I believe the Commission went astray went it decided in 2006, after
    years of not offering an interpretation of the preemption language in
    the Flammable Fabrics Act, to use the new Mattress Flammability
    Standard to interpret that statute to prevent certain civil court
    actions. I would hope any court looking at this sudden and unnecessary
    change in Commission policy would ignore it, but I would have much
    preferred if the Commission had not attempted to sway the courts with
    its own interpretation in the first place. It is up to Congress to
    decide what the preemptive effects of our statutes should be and I
    leave it to Congress to decide whether all of our statutes should
    contain the explicit non-preemption language contained in section 25(a)
    of the CPSA that makes it clear that CPSC rules and other orders ``do
    not relieve any person from liability at common law or under State
    statutory law to any other person.''
    Section 19: Information Sharing with Federal, State, Local and Foreign
    Budget Office only to ask for
    what is approved by the White House budget. And this isn't the
    only Agency that does this. We've got a huge amendment that's
    coming up on the floor on the Commerce, State, Justice
    Appropriations that directly affects me, and a lot of folks,
    including you in Missouri on NASA. And NASA can't request more,
    although they desperately need more. Because they've spent all
    of that money on the return to flight after the Space Shuttle
    Columbia's disaster.
        And so, why don't we just get to the nub of the coconut,
    which is, you can't ask for more even though you say you'll
    spend more, because you're under orders from the White House
    not to ask for more. Is that correct?
        Ms. Nord. I have never had a conversation like that with
    the White House, but----
        [Laughter.]
        Senator Nelson. Mr. Chairman----
        Senator Pryor. Go ahead.
        Senator Nelson. Well, there's one of them. Let's stipulate
    that once a product is recalled that it ought to be removed
    from the stream of commerce. But unfortunately, that has not
    happened.
        Here is Barbie's Dream Kitty Condo. And Barbie's Dream
    Kitty Condo has a kitty cat. And this product was still being
    sold over the Internet after it had been recalled--that was 2
    oblem: In the United States, the
    manufacturers of consumer products are not required to disclose the
    results of toxicity tests to regulators or the public before selling
    their products.
        In marked contrast, the European Union is adopting a ``better safe
    than sorry'' philosophy through regulations known as the Registration,
    Evaluation and Authorization of Chemicals. Manufacturers must

    tiny rare-earth magnets was not a recall, but merely a ``replacement''
    program:
    ---------------------------------------------------------------------------
        \6\ Child's Death Prompts Replacement Program of Magnetic Building
    Sets, CPSC release of 31 March 2006 available at http://www.cpsc.gov/
    cpscpub/prerel/prhtml06/06127.html.

            In November 2005, a 21-month old boy named Kenneth Sweet, Jr.
            died of blood poisoning and tissue necrosis; an autopsy showed
            that two separate sets of magnets had pinched parts of his
    ---------------------------------------------------------------------------
            small intestine.

            CPSC and [the manufacturer] Rose Art did not recall Magnetix
            toys on store shelves. Instead, Rose Art told consumers who are
            ``uncomfortable having the product in your home'' to return the
            sets to the company for a free replacement product suitable for
            children under the age of six. As of September 30, 2006, MEGA
            Brands [acquirer of Rose Art] had received approximately 13,000
            requests for replacements. This means that most of the four
            million Magnetix toys sold before March 31 have not been
            returned and could remain in homes across the United States.

        ``Uncomfortable having the product in your home'' is not an
    adequate product safety standard.
    Strengthen Import Protections
        For better or worse, we live in a global economy. Manufacturers
    seeking lowest-cost producers routinely stretch supply chains to China
    or other countries. While the manufacturer, importer, retailer or
    distributor is appropriately responsible under the CPSA and other laws
    enforced by the CPSC for ensuring that any product that it enters into
    commerce meets U.S. standards (and should not blame some sub-contractor
    when it does not), Congress should also take steps to better protect
    consumers from the hazards posed by imported products.
        The bill, S. 2045 takes several steps, which we support, to improve
    import safety.
        Section 10 (which applies to all children's products, not only
    imports), establishes new third party certification for all children's
    products. The section prohibits their importation without such
    certification. Importantly, the third party certification is
    administered under the authority of the CPSC. It would not be as useful
    were it not. Also, importantly, we would read Section 18 (preemption)
    as making it clear that mere certification of a product would not grant
    any immunity or shield from liability under state law. The committee
    should be wary of any attempts by industry associations to change this.
        Section 14 provides for improved identification of importers (and
    others). Section 20 would require the bonding of any importer, to
    ensure that it can pay for any necessary recalls, cost of holding at
    the port or product destruction. Section 19 improves the CPSC's ability
    to share information with both state enforcers and agencies of foreign
    governments. We are well aware of the European Commission's concerns
    over the current limitations on sharing hazard information with them;
    we believe that Section 19 will ameliorate their concerns.
        We would also urge the Committee to review recent House testimony
    \7\ by Public Citizen's Global Trade Watch, which points out that
    current and proposed trade pacts may limit the effect of your actions
    to strengthen import safety, or may subject them to trade sanction
    challenges.
    ---------------------------------------------------------------------------
        \7\ See testimony of Lori Wallach, Director, Public Citizen's
    Global Trade Watch, at a Hearing on Protecting Children from Lead-
    Tainted Imports, Subcommittee on Commerce, Trade and Consumer
    Protection of the House Energy and Commerce Committee, September 20,
    2007, available at http://energycommerce.house.gov/cmte_mtgs/110-ctcp-

    to report.
        Under circumstances provided in the statute, companies are
    required, by law, to report certain information to the Commission and
    to respond truthfully and completely to our information requests.
    Companies can keep certain information out of the public eye by
    appropriately identifying information such as trade secrets, which they
    want kept confidential and the Commission can use the law enforcement
    exception to the Freedom of Information Act, if it feels withholding
    certain information is necessary. What more assurance companies need
    for them to provide the information they are required to provide, I do
    not know.
        Public safety is our concern, not protecting companies from public
    scrutiny, and when there is a chance that there is a product in the
    stream of commerce that could hurt or injure someone we must have the
    ability to compel companies to tell us about that product and we must
    have the ability to quickly inform the public so that the product does
    not cause harm. Quick and accurate dissemination of information about
    potentially harmful products is essential to protecting the public from
    the risk of harm posed by those products. Given the often very
    difficult time we have obtaining information from some companies now, I
    doubt seriously that the current provisions of 6(b) play much of a role
    in encouraging disclosure. Consumers want timely, accurate warnings
    about products that may cause harm to their families. We should be able
    to provide that information to them in an accurate and expeditious
    manner.

        Question 2. How should the Commission react if companies don't
    provide information required by law?
        Answer. The failure to furnish information required by our statutes
    is prohibited by law and can subject the offender to possible civil and
    criminal penalties. The Commission should have the necessary tools and
    resources and be willing to aggressively enforce the laws adopted for
    the protection of the American consumers. S. 2045 provides increased
    resources and a substantial increase in our civil penalty cap. With
    these additional tools, the Commission could be in a much stronger
    position to compel compliance with its statutes and companies will be
    less inclined to test the will of a stronger Commission by withholding
    lawfully required information.

        Question 3. How do you believe we can ensure the best collaboration
    between the CPSC and industry in relation to this issue?
        Answer. The law requires reporting certain information to the
    Commission. The Commission is the regulator and has a job to perform
    with respect to the American public and the regulated community. One of
    the best ways to provide for the safest products for the marketplace is
    through a cooperative approach with industry. When working with
    industry can help us achieve our product safety goals, we should
    certainly be willing to work very closely with them, and we have. But,
    competition in the marketplace does not and will not inevitably take
    the form of a rivalry to produce the safest products. To successfully
    continue the mission of the agency, the Commission must have the
    resources and the flexibility to respond quickly and effectively to
    critical situations where the lives and health of the American public
    are at risk, whether the affected company or industry is cooperating
    with us or not.
        The best way for Congress to ensure collaboration between the CPSC
    and industry with respect to information that might lead to the
    determination that a product presents a hazard is to give the
    Commission the tools it needs to enforce its statutes. The Commission
    must then be willing to clearly communicate its expectations of
    industry for compliance while at the same time clearly communicating
    that there is a system in place for the responsible treatment of
    information provided.
    Attorneys General
        Question 1. Commissioner Moore, in your submitted testimony you
    state that the enforcement by Attorneys General could be a tremendous
    benefit given the agency's limited resources for litigation. What kind
    of resources does the agency have for litigation purposes?
        Answer. We have a pool of resources which include our existing
    compliance staff (including 10 attorneys in the legal branch) and
    several members from our General Counsel staff (2-3 attorneys), and
    about $170,000 in contract funds to draw upon. The pool of money is not
    a litigation pool but a pool for technical support, of which litigation
    is one part. We don't budget separately for litigation and technical
    support.
        We generally have conducted a limited amount of litigation so the
    funds and staff are made available for other support activities. If
    litigation develops as a priority, then the Commission must reassign
    the necessary resources away from other ongoing activities.

        Question 2. What, if any, relationship has the CPSC had with

    hat we're,
    that has already been mentioned at length.
        So, you all are not only setting a better standard, you are
    improving the chances that those standards will be well
    enforced.
        Mr. Mierzwinski. Senator, I just want to echo that your--
    your approach is absolutely the better approach, than to give
    this to rulemaking. And we strongly support that. And, as Alan
     and chlorinated fire
    retardants such as brominated and chlorinated Tris, PentaBDE, OctaBDE,
    DecaBDE, PBBs, and PCBs from products have been made throughout the
    world, including the private and public sectors. These efforts have
    made available replacements substantially safer to human health while
    atively low levels of
    exposure can affect large numbers of children. This means that more
    children need special education, there are fewer gifted children, and
    over time, the average IQ of the entire population falls.\19\
    Lead Poses a Serious Health Hazard to Children At Every Level of
            Exposure and Every Stage of Development
        Lead is easily absorbed by ingestion or inhalation. The most common
    route of exposure of children is through ingestion, usually by putting
    hands and other objects in their mouth. Both hand-to-mouth exploration
    and playing on floors are typical behaviors for children, especially
    rent, I have been incredibly
    distressed by the seemingly endless stream of reports about defective
    and dangerous children's toys and products.
        Forty percent of all consumer products, nearly $250 billion, were
    imported into the United States last year from China.
        The Consumer Product Safety Commission currently employs only 420
    full time employees responsible for ensuring the safety of well over
    15,000 products totaling $614 billion.
        The products CPSC monitors range in diversity from baby products to
    playground equipment to cell phones. Given that range of responsibility
    for protecting consumers and a budget of only $63 million annually, I
    worry that we simply have not done enough to ensure the safety of
    products coming in through our borders.
        As foreign imports soar, now is the time for us to step up our
    efforts to ensure that the food we consume and the products we use are
    as safe as possible.
        I am pleased to see this bill significantly increases the
    authorized funding amount for the CPSC each year through 2015 and
    provides for penalties for violations of this Act.
        While I am glad to see this bcriminal penalty under the CPSC statutes; it clarifies the
    criteria to be applied in assessing penalties; makes it
    unlawful to sell a recalled product after the public
    announcement of the recall; and it gives the Agency greater
    flexibility in designing a remedy when the recall is ordered.
        Harmonization of the CPSC statutes is another important
    element that is common to both our proposals. I'm also pleased
    to see in the Chairman's bill, my proposals to streamline the
    rulemaking process, and clarify the information sharing
    provisions with State, local and foreign governments.
        The testing and certification provisions of the bill also
    represent an area where we have common ground. In my proposal,
    I contemplated that the testing and certification requirements
    would be part of specific rulemakings, and so would be tailored
    to the risks that we're trying to address in the particular
    rulemaking.
        S. 2045 takes a different approach, and overlays a detailed
    testing and certification process for children's products on
    top of existing rules, and directs the Commission to construct
    and implement the program.
        As I'm sure the Committee is aware, the National Institute
    of Standards and Technology is charged under the National
    Technology Transfer and Advancement Act of 1995 with
    coordinating the conformity assessment activities of the
    Federal Government with those of the private sector.
        Assuming that this is consistent with the policy behind the
    provision in your bill, I would contemplate working with NIST
    to develop the best approach to meet the requirements of the
    bill, while utilizing the existing conformity assessment
    infrastructure.
        One particular provision of PRISM that is not in your bill,
    and that I would strongly encourage the Committee to consider
    as it continues its work on the legislation, is my proposal to
    clarify the enforceability of voluntary standards upon which
    the Commission has formally relied. I believe that such
    standards are, and should be, enforceable as mandatory product
    safety standards, under appropriate circumstances, as set out
    in the Act.
        I believe that this interpretation of the Consumer Product
    Safety Act would be an especially potent tool to use in dealing
    with unsafe imports, and I'll be submitting a briefing paper to
    the Committee, further outlining this important issue.
        While I believe many of the provisions of the legislation
    will be very helpful to the Agency, there are several
    provisions that I've flagged in my written testimony as raising
    resource concerns, expanding our jurisdiction into non-safety
    areas, and being unintentionally counterproductive in helping
    us carry out our mission.
        I have a number of substantive recommendations in that
    regard and I look forward to the opportunity to meet with the
    Committee's staff to discuss these recommendations in depth.
        We welcome the scrutiny and attention of Congress, and
    commend the leadership of this Committee for recognizing the
    need for reauthorization.
        Mr. Chairman, you referred to a constructive dialogue, and
    that is what I truly hope will take place, both here today and
    as we move forward. Our common goal is to make certain that the
    CPSC continues to represent the world's gold standard for
    consumer product safety. I look forward to working with you
    toward this objective, on behalf of American families.
        [The prepared statement of Ms. Nord follows:]

          Prepared Statement of Hon. Nancy A. Nord, Acting Chairman,
                    U.S. Consumer Product Safety Commission
        Mr. Chairman, and Members of the Committee:

        I appreciate the opportunity to testify today on S. 2045,
    legislation introduced by Chairmen Inouye and Pryor to modernize the
    statutes of the U.S. Consumer Product Safety Commission (CPSC). I want
    to thank the Committee for your interest in and support of the
    important safety mission of the CPSC. It has been a privilege to work
    this year with Chairman Pryor and Ranking Member Sununu and other
    Senators, and staff members, both at public hearings and in personal
    meetings, conversations and correspondence.
        Since its creation, CPSC's governing statutes have made the agency
    unique among government regulatory agencies in numerous ways. Forty
    years ago, in 1967, the Congress created the National Commission on
    Product Safety, and after 3 years of work, the Commission reported its
    findings to Congress in 1970. Informed by the Commission's findings,
    Congress proceeded to create the Consumer Product Safety Commission in
    1972.
        No small amount of work went into the crafting of that original
    legislation. For example, the Senate Commerce Committee held 10 days of
    public hearings; and in the House, the Interstate and Foreign Commerce
    Committee held thirteen days of hearings and ten executive sessions,
    including the joint sessions by the conference committee.
        Congress's thoughtful deliberations, hard work and keen
    farsightedness resulted in the creation of an agency that has
    contributed substantially to the decline in the rates of death and
    injury related to the use of consumer products. We estimate that
    overall, injuries and deaths associated with the use of products under
    CPSC's jurisdiction have declined by almost one-third since the
    agency's inception. Some products have shown even more dramatic
    reductions, such as crib-related deaths that have declined by 89
    percent over that time.
        The blueprint that Congress used in building this agency has served
    the public well. I am proud of CPSC's record of achievement and of the
    public service of the talented staff who have dedicated themselves to
    the agency's safety mission over these past three and a half decades.
        In preparing for a hearing earlier this year, I came across a
    statement from 1972 by former Congressman Harley Staggers who was
    Chairman of the House Interstate and Foreign Commerce Committee when
    the CPSC was established. Chairman Staggers was on the floor of the
    House bringing forward the CPSC enacting legislation and he noted in
    his remarks: ``The technological revolution and ever-increasing public
    demand for consumer products has produced over the last several years
    thousands of new products whose applications are not easily understood
    and whose use may pose potential for harm.''
        I was taken by the fact that this statement could be repeated today
    without sounding at all dated, and yet, there have obviously been very
    significant changes since 1972 in the way that consumer products are
    manufactured, marketed, bought and sold.
        Clearly, the dynamics of the marketplace have changed dramatically
    over these years. There are new technologies that have emerged, and
    continue to emerge, in creating and manufacturing products, such as
    nanotechnology which is addressed in the Chairman's bill. Additionally,
    technology has changed the way that consumers shop and purchase goods
    and the way that the public receives information. Perhaps the most
    significant change is that most of America's consumer products now come
    from overseas.
        So it is important to move forward in modernizing this agency, but
    it is also important to do so recognizing that the statutory foundation
    on which the agency was built is a fundamentally strong one. In moving
    forward, it is important to understand the rationale and common sense
    behind the original legislation and the subsequent reauthorizations
    that underpin the most effective product safety system in the world.
        The mission of the CPSC is to protect the public from unreasonable
    risks of injury and death associated with more than 15,000 types of
    consumer products under the agency's jurisdiction. We fulfill this
    mission by enforcing our governing statutes, including the Consumer
    Product Safety Act (CPSA), the Federal Hazardous Substances Act (FHSA),
    the Flammable Fabrics Act (FFA), and the Poison Prevention Packaging
    Act (PPPA).
        Since being appointed to the Commission two years ago, and
    subsequently being named Acting Chairman last year, I have closely
    studied, enforced and directed the implementation of these statutes.
    Based on this working experience, earlier this year I submitted to
    Congress a comprehensive list of legislative proposals, the Product
    Recall, Information and Safety Modernization Act, or PRISM, that I
    believe will strengthen the Commission's hand in enforcing our laws and
    protecting the American public from unsafe products.
        I am pleased to see a number of my proposals from PRISM included,
    and in some cases expanded, in the Chairman's bill that we are
    discussing today. For example, the bill adds asset forfeiture as a
    potential criminal penalty under CPSC's statutes and makes it unlawful
    to sell a recalled product after the public announcement that it has
    been recalled. Harmonization of CPSC's statutes is another important
    element that is common to both of our proposals. When CPSC was created,
    the agency inherited the authorities of other existing agencies, and we
    need to make the various statutes that CPSC administers more
    consistent.
        I am also pleased to see in the Chairman's bill my proposal to
    eliminate the requirement (but not the option) to do three-stage
    rulemaking, as opposed to two-stage rulemaking, which is what most
    other agencies use to promulgate their regulations. Implemented
    properly, this change would allow us to use three-part rulemaking for
    controversial and complex issues and issues that raise new matters
    while using two-part rulemaking for amendments to existing regulations
    and non-controversial technical rules (and I recommend Congressional
    direction to this effect). This change will make our regulatory process
    more streamlined, efficient and effective.
        While I have some questions about the implementation, resource
    requirements and potential outcomes of some sections of S. 2045, and I
    look forward to discussing some of those today, I do believe that many
    of the provisions in the legislation, many of which were drawn from my
    proposal, will enhance CPSC's ability to accomplish its important
    safety mission.
        One particular provision of PRISM that is not in the bill, and that
    I would strongly encourage the Committee to consider as it continues
    its work on the legislation, is my proposal to clarify the
    enforceability of voluntary standards upon which the Commission has
    formally relied. Under existing law, the Commission is required to
    terminate a formal rulemaking to write a safety standard and ``rely
    upon'', a voluntary standard under certain circumstances, and only
    after notice and comment to the public.
        The extent to which such a ``relied upon'' consensus standard is
    enforceable by the CPSC has been a subject of some debate in recent
    years. I have suggested that such standards are and should be
    enforceable as mandatory product safety rules, under appropriate
    circumstances, as set out in the Act.
        I believe that this interpretation of the CPSA would be an
    especially potent tool to use in dealing with unsafe imports. It would
    allow Customs and the CPSC the ability to stop these products at the
    port and refuse admission so that they are far less likely to reach
    store shelves or consumers hands.
        We have seen situations where consensus standards, complied with by
    much of industry, do a very good job of addressing a risk of injury.
    But if a foreign-manufactured product, which does not comply with such
    consensus standards, is imported into the United States, without this
    tool our enforcement option is to effect a recall. By clarifying the
    enforceability of relied upon voluntary standards, we would have a
    better ability to stop the import of unsafe products. I firmly believe
    that these changes would strengthen the Commission's hand, and I hope
    that the Committee will take a close look at that as we move forward.
    For the record, I am submitting a briefing paper to the Committee
    further outlining this very important issue.
        While I believe many of the provision of the bill will be very
    helpful to the agency, there are several provisions that I flag as
    raising resource concerns, expanding our jurisdiction into non-safety
    areas, and being unintentionally counterproductive in helping us carry
    out our mission. I have a number of substantive recommendations in that
    regard and look forward to the opportunity to meet with committee staff
    this month to discuss them in-depth.
        With respect to resource concerns, while the Senate Appropriations
    Committee and the full House of Representatives have passed funding
    increases for the CPSC, the Committees have also given the agency
    direction for the use of those funds. For example, the House-passed
    bill would increase CPSC's funding by $4.1 million and recommends
    funding sufficient to maintain staff at a level of 420 FTEs. CPSC staff
    estimates that the cost of that would be $2,087,000. The Committee also
    included $1,500,000 for information technology improvements. That would
    leave a balance of just over $500,000. (The bill approved by the Senate
    Appropriations Committee would provide an additional $3.2 million above
    the House measure.)
        The resource requirements of S. 2045 would require many times the
    discretionary amount left to us under the appropriations bills. For
    example, the requirement for five commissioners will increase the
    agency's overhead by approximately $2 million, monies that could
    otherwise be spent on other safety-related enforcement or regulatory
    activities. As another example, implementation of the ban on lead in
    children's products, one of eight rulemakings mandated in the bill,
    will require resources to be diverted away from existing enforcement
    and regulatory activities.
        To assist your deliberations, I have requested that our budget
    office analyze the bill to determine the resource implications and will
    provide that information to the Committee when it is available.
        With respect to expanding our jurisdiction into non-safety areas, I
    point to the provision in Section 16 making it a violation of our Act
    to sell a counterfeit product whether or not the product is safe and to
    the provision requiring the CPSC to referee whistleblower disputes.
    Further, the regulatory system set up for certifying and auditing
    testing laboratories seems to duplicate many of the functions of
    existing government and private organizations.
        With respect to provisions that make it more difficult to carry out
    our mission, I point, as examples, to the information disclosure
    provisions (which will make it more difficult to obtain the useful
    information we need to assess risks), the massive increase in penalties
    (which will induce companies to overwhelm us with uninvestigated
    consumer complaints), and the parens patriae provision (which will
    interfere with Commission investigatory and enforcement activities).
        As I noted earlier, the legislation that established the CPSC in
    1972 was the result of a long, arduous and thoughtful process by
    Congress. In the enacting legislation, the authors envisioned that the
    talents and resources of the private sector would play an important
    role in assuring consumer product safety for the American public.
        By leveraging those talents and resources through the voluntary
    standards process, which is given preference in our governing statutes,
    experts and persons from industry, consumer advocacy organizations, and
    other interested parties are brought together to develop the effective
    safety standards that cover many of the 15,000 types of consumer
    products under the agency's jurisdiction.
        Some have called this the ``Summer of Recalls'', especially with
    regard to toys manufactured overseas. I understand the concerns of
    parents and caregivers. I want to assure them that this agency is
    aggressively policing the marketplace, and that is part of the reason
    that you are seeing these recalls. The CPSC is engaged in a multi-
    pronged approach that involves initiatives with the Chinese government
    and the private sector, including foreign manufacturers directly, and
    increased surveillance and enforcement activities at the borders and
    within the marketplace.
        These recalls make the case for some of the changes in CPSC's
    governing statutes that we have proposed, but in amending these
    statutes, we should be careful not to undermine a system established by
    Congress over 30 years ago that has been extraordinarily effective in
    maintaining the safety of the vast majority of the hundreds of millions
    of products brought into American homes every year and in making our
    product safety system the envy of the rest of the world.
        CPSC's safety mission is never a completed task. It is an ongoing
    and continuously evolving process. We welcome the scrutiny and
    attention of Congress and commend the leadership of this Committee for
    recognizing the need for reauthorization. Our common goal is to make
    certain that the CPSC continues to represent the gold standard of
    consumer product safety. I look forward to working with you toward this
    objective on behalf of America's families.

        Senator Pryor. Thank you.
        Commissioner Moore?

    STATEMENT OF HON. THOMAS H. MOORE, COMMISSIONER, U.S. CONSUMER
                       PRODUCTS SAFETY COMMISSION

        Mr. Moore. Mr. Chairman, Mr. Ranking Member, and Members of
    the Subcommittee, I appreciate the opportunity to appear before
    you today to provide testimony on S. 2045, legislation to
    reform and reauthorize the United States Consumer Product
    Safety Commission, CPSC. The Commission is charged by Congress
    with the critical responsibility of protecting the public
    against unreasonable risk of injury and death, associated with
    over 15,000 classes of consumer products.
        This is now--and has always been--a very crucial
    responsibility, because without CPSC's intervention, the
    consequences of exposure to the hazards associated with
    dangerous products may literally be of a life or death nature
    for individual consumers who unknowingly possess unsafe
    consumer products.
        The question that many American consumers will be asking
    during this holiday gift-buying season is, is it safe?
        This year, the Commission has been involved in a large
    number of highly publicized recalls. Some of these recalled
    products were associated with long-trusted domestic
    manufacturers, and involved very popular products that could be
    found in the homes of millions of consumers. These recalls have
    shaken the confidence of the American consumer in the
    government's present ability to protect them from unreasonable
    hazards associated with products produced in our current global
    marketplace.
        Today we find that increasing numbers of U.S. companies are
    either importing finished products or component parts made in
    other countries, or establishing their own production plants
    outside of the U.S. In many, many cases, domestic companies
    have not exercised the same degree of control over these
    products as they would have if their products were being made
    in this country.
        This inability to have constant, hands-on supervision has
    resulted in products entering this country that do not meet
    long-established U.S. mandatory safety standards. In addition,
    the delicate balance that exists between the development and
    enforcement of mandatory product safety standards, and the
    development and enforcement of voluntary product safety
    standards is not always completely understood by many foreign
    manufacturers who introduce consumer products into this
    country's system of commerce.
        As a result, we are now keenly aware that inspection,
    testing, education and enforcement tools at the Commission's
    disposal are glaringly insufficient to police our present,
    globally affected consumer marketplace. Moreover, new and
    emerging technologies, such as nanotechnology, present unique
    challenges for the Commission. Given the many products already
    on the market using nanotechnology, from computer chips to
    Docker pants, I do not think it will be too long before the
    Agency is asked to assess the risk of nanotechnology use in
    some consumer products under our jurisdiction. At this point in
    time, we would be hard-pressed to make an assessment, because
    we simply do not have the resources to do it.
        As you are aware, CPSC's last authorization expired in
    1992, and although we have visited the process of
    reauthorization on a couple of occasions, our statutes have not
    been significantly revised since 1990. However, it is
    exceedingly obvious that the marketplace for consumer products
    has changed dramatically since that time.
        I must acknowledge that both the House and the Senate were
    moving in the direction of modernizing the Commission well
    before the publicity surrounding recalled products under our
    jurisdiction began earlier this year. We know that these
    reauthorization proceedings can be an exceedingly intensive
    undertaking for the CPSC, but I welcome this reauthorization
    process in both the House and the Senate, because I believe it
    presents a unique, and much-needed, opportunity for all of us
    to focus on the Commission's present and future agenda. I think
    that this comprehensive legislation package takes a giant
    step--more like a giant leap--in the direction of giving the
    Commission the tools that it needs to become the enforcement
    force that it should be in today's consumer marketplace. Many
    of the provisions come from recommendations submitted by myself
    and Acting Chairman Nord, and I am very hopeful that we see
    this legislation move from the introduction stage to final
    passage.
        However, I think it is very important that, in whatever we
    do collectively--through efforts at the Administration level,
    Congress and the Commission to address the most recent problems
    facing the Commission, we must send a clear, unequivocal
    message to manufacturers, importers, and retailers who bring
    and offer for sale in this country products which present a
    substantial product hazard or that do not comply with the U.S.
    product safety standard. That message should be that, your
    actions are unacceptable and you will be held accountable.
        The Commission must have the sufficient resources, the
    adequate authority, and the internal willingness to deliver
    that message with no hesitation. The Pryor legislation goes
    very far in providing the first two variables in the equation
    for an effective enforcement authority. The Commission must be
    ready to supply the rest.
        Thank you for holding this important hearing--very
    important hearing. And I would be happy to now answer questions
    that you may have. Thank you.
        [The prepared statement of Mr. Moore follows:]

           Prepared Statement of Hon. Thomas H. Moore, Commissioner,
                    U.S. Consumer Product Safety Commission
        Mr. Chairman, Mr. Ranking Member, and Members of the Subcommittee,
    I appreciate the opportunity to appear before you today to provide
    testimony on S. 2045, legislation to reform and reauthorize the United
    States Consumer Product Safety Commission (CPSC). The Commission is
    charged by Congress with the critical responsibility of protecting the
    public against unreasonable risk of injury and death associated with
    consumer products. This is now, and has always been, a very crucial
    responsibility because, often without CPSC's intervention, the
    consequences of exposure to the hazards associated with dangerous
    products may literally be of a life or death nature for individual
    consumers unknowingly in possession of unsafe consumer products.
    Is it Safe?
        The question that many American consumers will be asking during
    this holiday gift buying season is, ``is it safe?'' This year, the
    Commission has been involved in a large number of highly publicized
    recalls. Some of these recalled products were associated with long
    trusted domestic manufacturers and involved very popular products that
    could be found in the homes of millions of consumers. These recalls
    have shaken the confidence of the American consumer in the government's
    present ability to protect them from unreasonable hazards associated
    with products produced in our current global marketplace.
        Today we find that increasing numbers of U.S. companies are either
    importing finished products or component parts made in other countries
    or establishing their own production plants outside of the U.S. In
    many, many cases, domestic companies have not exercised the same degree
    of control over these products as they would have if their products
    were being made in this country. This inability to have constant hands-
    on supervision has resulted in products entering this country that do
    not meet long established U.S. mandatory safety standards.
        In addition, the delicate balance that exists between mandatory
    product safety standards development and enforcement and voluntary
    product safety standards development and enforcement is not always
    completely understood by many foreign manufacturers who are involved in
    importing consumer products into this country's stream of commerce. As
    a result, we are now keenly aware that inspection, testing, education
    and enforcement tools at the Commission's disposal are glaringly
    insufficient to police our present globally affected consumer
    marketplace.
        Moreover, new and emerging technologies such as nanotechnology
    present unique challenges for the Commission. Given the many products
    already on the market using nanotechnology, from computer chips to
    Dockers pants, I do not think it will be too long before the agency is
    asked to assess the risks of nanotechnology use in some consumer
    product under our jurisdiction. At this point in time we would be hard-
    pressed to make such an assessment because we simply do not have the
    resources to do it.
        As you are aware, CPSC's last authorization expired in 1992 and,
    although we have visited the process of reauthorization on a couple of
    occasions, our statutes have not been significantly revised since 1990.
    However, it is exceedingly obvious that the marketplace for consumer
    products has changed dramatically since that time.
        I must acknowledge that both the House and the Senate were moving
    in the direction of modernizing the Commission well before the
    publicity surrounding recalled products under our jurisdiction began
    earlier this year. We know that these reauthorization proceedings can
    be an exceedingly intensive undertaking for the CPSC, but I welcome
    this reauthorization process in both the House and the Senate because I
    believe it presents a unique and much needed opportunity for all of us
    to focus on the Commission's present and future agenda.
        Senator Pryor's legislation, which is the subject of this hearing
    today, takes a giant step--more like a giant leap--in the direction of
    giving the Commission the tools that it needs to become the enforcement
    force that it should be in today's consumer marketplace. From this
    point in my statement, I will go through the legislation, section by
    section, and express my views on its affect on how a future Commission
    would operate given the passage of such a provision.
    Section by Section
    Section 3: Reauthorization
    Section (a)--Reauthorization Levels
        I support this incremental approach to increasing our budget and
    staff. Since we require a yearly increase of about 3 to 4 percent to
    keep current with increases in salaries, rents and other operating
    costs, yearly increases in the range of 10 to 15 percent would, in my
    mind, provide the Commission with a good growth pattern. This growth
    pattern would also allow the Commission to do a yearly assessment of
    where the areas of need most exist at the Commission therefore allowing
    the Commission to address its needs in light of the current consumer
    product safety problems.
    Section (b)--Lab Modernization Funding
        I support providing this level of funding to modernize our testing
    facilities. Given that we are the Federal agency designated to protect
    consumers from product hazards and that our laboratory testing plays a
    key role in making hazard determinations, I think that the state of our
    lab should concern everyone. The Lab Modernization Feasibility Study,
    completed jointly with GSA in 2005, formed the basis for a capital
    project submitted to OMB by GSA as part of their FY 2007 budget.
    However, other national priorities precluded the project from being
    funded. It was estimated back in 2005, that the cost to truly modernize
    our lab, if we were to stay on the current site, would be somewhere
    around thirty million dollars. Forty million over 2 years would expand
    our capabilities plus give us new equipment and a physical plant that
    is both energy efficient and an effective use of space.
    Section (c)--Funding for Nanotechnology Research
        I support funding for research in this emerging hazard area as I
    have indicated above.
    Section 4: Personnel
    Section (a)--Professional Staff
        I support bringing the level of full-time personnel employed by the
    Commission to a minimum of 500 by the beginning of FY 2013. In fact, it
    is my hope that by 2013 we would be beyond the 500 FTE level. In a
    three-year period, the Commission staff level has been reduced from a
    funded level of 471 FTEs in FY 2005 to a proposed level of 401 FTEs for
    FY 2008. I would hope that we could get well above that level of
    employment in the 5 years contemplated in this legislation.
    Section (b)--Professional Career Path
        I support incentives to attract highly qualified professionals to
    the Commission and to keep them there. Over time we hope to be able to
    train replacements for the many experienced employees that have left
    the Commission during the last few years but the experience that we
    have lost will take years to recover.
    Section (c)--Change of Employment Status by Political Appointees
        I support this provision which would provide a mechanism for the
    Commission to discourage the practice of unnecessarily placing
    political employees into career positions.
    Section (d)--Personnel in Immediate Office of Commissioners
        I support this provision which would prevent alliances from being
    formed by a majority of Commissioners to affect staffing in any
    Commissioner's immediate office. I do understand that in times where
    the whole Commission is being reduced, Commissioner's immediate offices
    should also be a part of reduction considerations but any decision
    about reductions in immediate offices should be something agreed upon
    by all Commissioners.
    Section 5: Full Commission Requirement; Interim Quorum
    Section (a)--Number of Commissioners
        I support restoring the Commission to its full 5 member complement.
    It is my experience that the current 3 member structure usually only
    allows for one alliance to be formed--by the majority political party
    at the Commission. With only 3 Commissioners, the Chair assumes greater
    significance than our statute contemplates. The ``executive and
    administrative functions,'' which should be the only authority that
    sets the Chair apart from his colleagues have morphed into control over
    policy matters. Now the Chair only has to secure one vote--that of his
    fellow party member--to control the Commission. If the Chair had to
    secure two votes, his ability to have unchecked say over policy matters
    would be lessened. Also, when you have an agency with five members, the
    Sunshine Act does not hamper the normal dialogue that should go on in
    an agency because any member can still talk to any other member about
    agency business. But where you have only three Commissioners, the
    result is that no Commissioner should ever talk to another Commissioner
    about any matter of substance pending before the Commission except in
    an open meeting after public notice because two members constitute a
    quorum.
    Section (b)--Temporary Quorum
        When there are only three Commissioners on the Commission, in times
    where there is a vacancy on the Commission, two Commissioners, if not
    of the same party, should always constitute a quorum for transacting
    Commission business. I certainly understand that this might tend to
    lessen the pressure on the President to fill a vacancy but as long as
    there are only three Commissioners, the chance of losing the ability to
    operate as a Commission will exist. It has happened on three separate
    occasions since 2001.
    Section 6: Submission of Copy of Certain Document to Congress
        I support this provision. Congress used to get a copy of our budget
    submission to the Office of Management and Budget (OMB). Several years
    ago, in an effort to cut down on the reports it was receiving, Congress
    indicated it no longer wanted to see those budget submissions. OMB has
    since made these budget submissions confidential so they no longer can
    be made public by the agency. I think that Congress (and the public)
    should be able to fully review the agency's original budget request to
    the administration as it makes final funding decisions with regard to
    the agency.
    Section 7: Public Disclosure of Information
        I think that this provision of the legislation strikes a good
    balance between the need for the public to have expeditious and
    accurate information about potentially hazardous products and the
    legitimate desire of companies to protect themselves from the possible
    disclosure of confidential or inaccurate information about them or
    their products. I know that some argue that being able to provide
    information to the Commission and having it kept secret from the public
    somehow encourages fuller disclosure by companies than there would be
    otherwise. However, companies are required, by law, to report certain
    information to the Commission and to respond truthfully and completely
    to our information requests. Companies can keep certain information out
    of the public eye by appropriately identifying information such as
    trade secrets, which they want kept confidential, and the Commission
    can use the law enforcement exception to the Freedom of Information
    Act, if it feels withholding certain information is necessary.
    Section 8: Rulemaking
        I support this provision which gives the Commission the option of
    streamlining the regulatory process in the Consumer Product Safety Act
    and the Federal Hazardous Substances Act when the Commission feels that
    a shorter process may be appropriate. One example of such an occasion
    might be where the Commission believes an adequate voluntary standard
    exists (based upon active staff participation in the development of the
    standard) that addresses a real risk of injury but which is not being
    adequately complied with and where the enforcement powers that come
    with a mandatory standard could significantly increase the compliance
    rate. Giving the Commission the option to go straight to a notice of
    proposed rulemaking in such a case as this makes sense and would be a
    reasonable application of such an option. Another example where the
    Commission might decide to streamline the process is in a rulemaking
    where the Commission is proposing amendments to a current regulation
    that do not change the overall thrust of the regulation.
    Section 9: Prohibition on Stockpiling Under Other Commission-Enforced
            Statutes
        I agree with this provision which adds the anti-stockpiling
    provision of the Consumer Product Safety Act to all of the other
    statutes which the Commission administers.
    Section 10: Third Party Certification of Children's Products
        I support this provision which requires independent third-party
    testing and certification of children's products, as defined, which are
    subject to a consumer product safety standard under the CPSA or a ban
    under the CPSA or any other Act administered by the Commission. This
    provision will give the Commission additional enforcement powers to
    identify and stop violative children's products from entering this
    country and authority to penalize those who fail to comply with its
    requirements.
        The Commission will also have the ability to prescribe by rule the
    qualifications of the certifying parties, criteria for which a
    certificate can be issued, as well as requirements for periodic audits
    of testing laboratories.
    Section 11: Tracking Labels for Durable Products for Children
        I support this provision. Identifying the exact product to be
    recalled can sometimes present a problem. We have been involved several
    times in situations where we have initiated a recall and then, based
    upon subsequent information, had to expand that recall. I agree that
    the burden should be on the manufacturer/importer/distributor to make
    sure that children's products or other products are clearly marked and
    distinguished so that problem products can be readily sourced and
    identified by the manufacturer, the Commission staff and by consumers
    who may have the product in their homes.
    Section 12: Substantial Product Hazard Reporting Requirement
        I agree with explicitly extending the reporting requirements of
    Section 15(b) of the CPSA to all of the other statutes that we
    administer.
    Section 13: Corrective Action Plans (Mandatory)
        I support giving the Commission the authority to decide what remedy
    a company must take to adequately protect the public when the company
    has refused to do a satisfactory voluntary recall. Some companies have
    used our inability to require a particular remedy in a mandatory recall
    setting as leverage in structuring their voluntary recall response. The
    current system, which allows the company to select the recall remedy,
    is one reason why the Commission has so rarely used its mandatory
    recall authority.
        With regard to the language in new subsection 3(C), depending upon
    the remedy chosen for the action plan, there may or may not be a
    product still being distributed in the market that was subject to the
    recall. The subcommittee might want to consider amending the language
    along the following lines: ``. . . the manufacturer, retailer or
    distributor shall take whatever remedial action, including ceasing
    further distribution in commerce of the product to which the action
    plan applies, as the Commission shall order.''
    Section 14: Identification of Entities in the Supply Chain
        I support this provision. It puts everyone in the supply chain on
    notice that they need to know who they are dealing with, no matter how
    long that chain is. In the event of a recall or other investigation by
    the Commission, such information can be essential in getting accurate,
    timely information to consumers.
    Section 15: Repeat Violators--Importers
        I support this provision. While individual importers are not
    licensed, and in fact, anyone can go online and get an identification
    number and instantly become an importer, importer brokers, who most
    importers use, are licensed. Our staff has identified brokers they
    consider to be bad actors whose importers routinely bring in violative
    products, and who take advantage of our limited port presence to steer
    importers with noncomplying products to ports where they are less
    likely to be inspected.
        I was shocked to read in the recent report to the President by the
    Interagency Working Group on Import Safety that there are over 825,000
    importers. I do not know how many different people/entities that number
    actually represents since one person can have an unlimited number of
    import registration numbers, but even if only 10 percent of them handle
    consumer products, that still presents our agency with a daunting
    responsibility in terms of educating and policing that community.
    Focusing on the brokers may be a more manageable task.
    Section 16: Sale and Exportation of Violative and Recalled Products
    Section (a)--Sale of Recalled Products
        I support this provision. This will make retailers, in particular,
    more vigilant in checking their shelves to make sure recalled products
    are promptly removed and will help stop the sale of recalled items over
    the Internet, a problem which has increased in recent years. This also
    expands the prohibited acts section of the CPSA to cover any of the
    rules or bans issued by the Commission under our other statutes.
    Section (b)--Export of Recalled Products
        I have raised the issue of our export policy because I believe it
    is time to have a discussion about whether that policy still serves our
    national interest. I purposely refrained from suggesting any ``fix''
    because I think there needs to be a broad reexamination of the role
    this country now plays in the world marketplace. If we want other
    countries to protect our consumers here in the U.S. through their
    export policies, then perhaps we should be more willing to protect
    their consumers through our own export policy. It has been twenty-five
    years since this was last debated and it is fitting that any discussion
    be in the Congress, as Congress established our current policy.
        This provision gives the Commission broad authority to prevent the
    export of a product that violates one of our mandatory rules or bans,
    or has been recalled, or has been declared an imminent hazard under the
    CPSA. On its face I think this is good policy although it would be much
    simpler for the Commission to enforce if the law stated that the
    Commission would only allow export of those products if it received
    notification from the receiving country that it would accept the
    product.
        There are U.S. manufacturers who make products for export that meet
    the standards of the receiving country but that do not comply with the
    comparable U.S. mandatory standard. A policy that required the
    receiving country to evidence its acceptance of the product would not
    interfere with legitimate trade between willing trading partners.
        I see no impediment to applying such a requirement that we receive
    positive notice from the receiving country before allowing exportation
    of recalled unregulated products. This would eliminate the need for the
    phrase ``would have been subject to mandatory corrective action under
    this or another Act enforced by the Commission if voluntary corrective
    action had not been taken by the manufacturer.'' It could be difficult
    for the Commission to develop industry guidance on such a phrase. The
    staff does now, on occasion, negotiate a non-export provision with a
    company as part of a voluntary recall of an unregulated product. This
    legislative change would provide staff with the clear authority to deny
    the exportation of recalled unregulated products as part of the
    corrective action plan unless the receiving country indicated their
    willingness to receive the product. I also support making the export
    provisions of the Flammable Fabrics Act consistent with the export
    policy in our other statutes.
        The current export policy was written in a different era when we
    were a major exporter. Now we are largely on the receiving end and our
    consumers do not know who to trust anymore when they are buying a
    product. Changing our policy to one that requires the consent of the
    receiving country to export a product that we would not sell to our own
    citizens puts us in a better position to be able to more successfully
    demand that products coming into our own country from abroad meet our
    own safety standards.
    Section (c)--False Certification of Compliance With Testing Laboratory
            Standards
        I support this provision which will give us another tool to
    penalize makers and importers of recalled products that purport to meet
    nationally recognized standards, but which intentionally do not.
    Counterfeiting is big business and we should make it a costly mistake
    to make unsafe products under the false auspices of a respected entity
    such as the Underwriters Laboratories.
    Section (d)--Misrepresentation of Information in Investigation
        I support this provision. Occasionally manufacturers, in an attempt
    to reduce the cost of a recall, will try to limit the number of
    products affected by it. Then, when injuries occur with the same
    product, but in a production run not covered by the initial recall, the
    Commission is forced to expand the scope of the recall to cover those
    additional products. We seem to be seeing more of these situations
    lately. This provision would make companies pay closer attention to
    correctly identifying the scope of their products included in the
    recall and give us one more tool to keep companies honest in their
    dealings with the Commission.
    Section 17: Penalties
    Section (a)--Civil Penalties
        I support this increase in the maximum amount of civil penalties
    that may be assessed for violations of our statutes. While I had
    initially supported having no civil penalty cap at all, I think the
    amount specified by this bill is sufficient to prevent even the largest
    companies from viewing the risk of getting caught violating our
    statutes as merely a cost of doing business.
        Our negotiating room would no longer be so limited that it would be
    difficult for the agency to make, and for industry to see, meaningful
    distinctions in our assessments of civil penalty amounts among the
    types and circumstances of the violations involved. As a practical
    matter, the staff and the Commission would still be guided by the
    circumstances of each violation but would no longer be constrained by
    an upper limit that often results in penalties lower than the staff
    would like to assess. In addition, with such an increase the agency
    could immediately begin to look at assessing penalties for all
    violations of section 19 and not focus, as we have almost exclusively,
    on failure to report, a situation that I believe has resulted from a
    maximum penalty amount set too low to accommodate multiple violations.
        I support making the penalty amounts the same in all of our
    statutes. I also support the provision that makes it clear that the
    Commission may consider other factors in deciding the amount to assess
    for a civil penalty in addition to those specified in our statute.
    Section (b)--Criminal Penalties
        I support removing the requirement in the CPSA that there has to be
    a notice of noncompliance received by the company from the Commission
    before a criminal penalty can be imposed for a violation of section 19.
    This has been an impediment to the Justice Department's ability to
    pursue criminal sanctions on the agency's behalf.
        The two-tier criminal penalty system laid out in the bill is
    similar to one that the Justice Department has indicated we should have
    and since they actually prosecute our criminal cases, I would bow to
    their assessment that they think such a system is needed. It might be
    helpful if the bill provided some guidance as to the meaning of
    ``knowing'' and ``willful'' in the criminal penalty provisions.
        I also support the two-tier system in the FHSA. I do note that
    while it increases the penalties, it does add a ``knowing'' requirement
    to the first tier offenses that does not currently exist. Given the
    increase in the penalty amount, and the desirability of harmonizing the
    criminal penalties with that of the CPSA, that may be an appropriate
    change.
        I do not know why there are no criminal penalties under the
    Flammable Fabrics Act, but considering that children's sleepwear,
    mattresses, and upholstered furniture are regulated (or may potentially
    be regulated) under this statute, Congress might want to consider
    including the same criminal sanctions in that statute as are contained
    in the CPSA and the FHSA.
        I also support having the additional criminal penalty of requiring
    a company to forfeit any assets associated with a violation of our
    statutes. All of these provisions will greatly strengthen the agency's
    hand in criminal cases and put real teeth in our enforcement abilities.
    Section 18: Preemption
        I believe the Commission went astray went it decided in 2006, after
    years of not offering an interpretation of the preemption language in
    the Flammable Fabrics Act, to use the new Mattress Flammability
    Standard to interpret that statute to prevent certain civil court
    actions. I would hope any court looking at this sudden and unnecessary
    change in Commission policy would ignore it, but I would have much
    preferred if the Commission had not attempted to sway the courts with
    its own interpretation in the first place. It is up to Congress to
    decide what the preemptive effects of our statutes should be and I
    leave it to Congress to decide whether all of our statutes should
    contain the explicit non-preemption language contained in section 25(a)
    of the CPSA that makes it clear that CPSC rules and other orders ``do
    not relieve any person from liability at common law or under State
    statutory law to any other person.''
    Section 19: Information Sharing with Federal, State, Local and Foreign
            Governments
        I support this provision for information sharing. The Commission
    would have to be judicious in its distribution of material to others
    and vigilant in making sure that information provided by it or given to
    it is not disclosed inappropriately. Information given by the agency to
    an entity who inappropriately disclosed it, should nullify any
    agreement to share information with that entity in the future.
    Section 20: Bond Authority
        I support this provision to require a measure of financial security
    from those who seek to distribute or sell products in our country and
    whose products may subsequently be recalled or seized at their port of
    entry for failure to comply with a mandatory standard. This may be
    particularly helpful in the case of certain importers who have little
    financial stake in the transaction they are facilitating.
    Section 21: Enforcement by State Attorneys General
        Given the Commission's historically small resources for litigation,
    having fifty additional legal teams to enforce the provisions of our
    statutes could be of tremendous benefit. However, the Commission needs
    to retain control over the interpretation of its statutes for
    enforcement purposes and would not want to spend significant resources
    intervening in cases to assure this result. The subcommittee might
    consider whether it is possible to require the State Attorneys General
    to consult with the General Counsel of the Commission prior to filing a
    lawsuit and condition the filing of the suit upon the consent (or non-
    objection) of the Commission. This would allow us to head off misguided
    lawsuits and lessen the need for the Commission to intervene in these
    proceedings.
    Section 22: Whistleblower Protection for Manufacturers' Employees
        The bounty provision of this section is intriguing. On occasion,
    employees of companies have provided information to the Commission that
    has proven useful in pursuing actions against their companies for
    violations of our statutes. Encouraging employees with this type of
    information to come forward, and then protecting them when they do,
    could act as one more deterrent to companies who put profit ahead of
    safety. However, the protection side of the equation would be difficult
    for our agency to administer. Each case would require an examination of
    the facts in the particular situation and an understanding of the
    personnel system and rules in the employee's company as well as the
    history of the interactions between the employee and the company. These
    are not the types of cases in which CPSC lawyers are typically involved
    and I am not at all sure that having the Commission become so
    intimately engaged in the inner workings of a company's employment
    practices would be appropriate. If the subcommittee wants to provide
    protection to employees in these situations, it may want to look at
    another venue for these employee complaint determinations, such as the
    Department of Labor.
    Section 23: Ban on Children's Products Containing Lead and Amendment of
            the Lead Paint Rule
        I support this provision. I am pleased to see that this bill gives
    teeth to the Commission's 1998 guidance statement to industry urging
    them to remove lead from children's products. The response from the
    Congress, the media, and from parents to the recent spate of recalls
    makes it clear that consumers will not tolerate their children being
    exposed to lead in children's products. The bill provides a ceiling for
    lead in these products, but gives the Commission the authority to set
    that ceiling even lower. It also lowers the amount of lead allowed in
    paint or other surface coatings on children's products. It is my
    understanding that the majority of American paint manufacturers already
    meet this extremely low level of 90 parts per million, so this change
    reflects a standard of care most members of our industry already meet
    and it should similarly be attainable by paint manufacturers in other
    parts of the world who send their products to the United States.
    Section 24: Cost-Benefit Analysis Under the Poison Prevention Packaging
            Act
        I support this provision as I believe it clarifies the intention of
    an earlier Congress not to require a cost-benefit analysis in a statute
    that seeks to reduce children's poisoning deaths by requiring certain
    substances to be in child-resistant packaging. The cost of child-
    resistant packaging adds pennies to the cost of a product. This is a
    small price to pay to help keep our children safe. This Act has worked
    well and it should not be weakened by allowing OMB to pressure CPSC to
    read language into the statute that does not exist.
    Section 25: Completion of Upholstered Furniture Rulemaking
        I appreciate the subcommittee's frustration with the slow pace of
    this rulemaking, although I think certain developments, such as the
    Commission's work in the mattress rulemaking, have added greatly to our
    understanding of the fire dynamics of upholstered furniture and have
    changed the way our staff is looking at this problem for the better. I
    do think it is time for the Commission to issue a proposed rule based
    on the staff's extensive work and let all parties have their say.
    Conclusion
        I think that the comprehensive legislation package introduced by
    Senator Mark Pryor, with Commerce Committee Chairman Senator Daniel
    Inouye as original cosponsor, and with Senator Richard Durbin and
    Senator Amy Klobuchar as cosponsors, will severely test the will of
    Congress to provide the Commission with the necessary tools it needs to
    be an effective force in protecting consumers from product safety
    hazards. Many of the provisions come from recommendations submitted by
    myself and Acting Chairman Nord.
        However, I think that it is very important that in whatever we do
    collectively--through efforts at the Administration level, Congress and
    the Commission--to address the most recent problems facing the
    Commission, we must send a clear, unequivocal message to manufacturers,
    importers and retailers who bring and offer for sale in this country
    products which present a substantial product hazard or that do not
    comply with a U.S. product safety standard: That message should be
    that, ``your actions are unacceptable and you will be held
    accountable.'' The Commission must have the sufficient resources, the
    adequate authority and the internal willingness to deliver that message
    with no hesitation. The Pryor legislation goes very far in providing
    the first two variables in the equation for an effective enforcement
    authority. The Commission must supply the rest.

        Senator Pryor. Thank you, Commissioner.
        What we're going to do is go a little bit out of order
    because of some scheduling constraints here. I'll recognize
    Senator Sununu first, and we'll go to Senators Klobuchar, then
    McCaskill, then Nelson.
        Senator Sununu. Thank you, Mr. Chairman.
        Chairman Nord, you spoke about one provision you'd like to
    see included in the legislation that's not there, that's the
    ``relied upon'' standard. Could you explain, briefly, what that
    really means, and why you think it's an important item to have
    in the legislation?
        Ms. Nord. Yes, the Consumer Product Safety Act sets out a
    rather complex way for the Commission to write safety standards
    on its own initiative. But, it also recognizes that there is a
    very skilled community out there that writes safety standards,
    that pulls in all stakeholders, that looks at the technical
    feasibility of these things, and comes out with voluntary
    standards. An example might be an Underwriters Laboratory
    standard for electrical products, extension cords, that sort of
    thing.
        The statute says that the Commission may rely on these
    voluntary standards under certain circumstances. It talks in
    terms of putting that decision out for notice and comment so
    that we can get input from the public on whether that standard
    is a good one, and should be relied on.
        I believe that the statute can be read--and should be
    read--to say that in those circumstances, when we go through
    that process, that standard then takes on an enforceability
    characteristic. And if we did that, then we would be able to
    use that as a way to deal with unsafe imports.
        As I said, there's a UL standard for electrical products--
    that's a voluntary standard, that's not a mandatory standard.
    But, I think that's an example of something where we could rely
    on that standard--after getting notice and comment, which our
    statute requires--and then enforce that standard against
    imports also. I think it could be done now, under the way the
    statute is written, however, if there is confusion on that
    point, I would be happy to submit for your consideration some
    clarifying--minor clarifying--amendments.
        Senator Sununu. Where in the legislation might you
    highlight one or two areas of particular concern? Where do you
    think that the goals or the objectives of the legislation might
    not be well-served because of secondary impacts or unintended
    consequences?
        Ms. Nord. Well, I'm concerned about the provision calling
    for a parens patriae enforcement of the Consumer Product Safety
    Act. We can talk about how that would impact our Agency, but I
    do think that that would result in a great deal of confusion
    and a lack of primacy of the Agency in interpreting its own
    statutes.
        I am concerned about the amendment to Section 6(b), because
    I think that 6(b) is very much of a tool in our tool chest that
    we use in order to get information from companies, and enforce
    the law. So, I'm concerned about the way that that provision of
    the bill is written. I think, however, that under the construct
    that is set out there, we can make some changes to it, to keep
    the good parts of 6(b), but get rid of the parts that are being
    criticized.
        Senator Sununu. And 6(b) affects manufacturer's ability and
    opportunity to comment on information, and provide information
    to the Commission, is that correct?
        Ms. Nord. Yes, yes it does.
        Senator Sununu. So is it--part of that process sort of
    maintaining a high level of cooperation and collaboration?
        Ms. Nord. Well, it's more than that.
        Under the Consumer Product Safety Act, manufacturers are to
    report to us whenever they become aware of a defect that could
    present a problem. That is a much, much looser standard than
    any other Federal agency has with regard to reporting
    requirements. It's much looser than, for example, what NHTSA
    has.
        So, what we are doing is telling companies that they need
    to report to us, and they have to make a judgment call as to
    when they need to report to us--it's when a defect could pose a
    problem.
        Senator Sununu. When you say it's a looser standard, you're
    saying it's a very low bar----
        Ms. Nord. Yes.
        Senator Sununu.--a very low threshold for them to come
    forward to you with information, because they think that there
    might be an issue?
        Ms. Nord. Yes, yes. But, on the other hand, I'm not
    criticizing that standard, I think that standard is important,
    because it encourages companies to come to us and talk to us
    about problems. We, then, work with the company to determine
    whether there is an issue, whether there is a defect, whether a
    recall needs to happen. And with respect to a number of the
    reports we get, we determine that no recall is required.
        What we don't want to do, and what I'm concerned about with
    the way the amendment to 6(b) is written, is that it is going
    to decrease the incentive for companies to come to us and work
    through these problems. Because the confidentiality isn't
    protected. I think, however, that if we were to take the
    construct of the amendment to 6(b) in this Act, and include a
    requirement that we could keep confidential information that is
    reported to the Commission until after there is a recall, that
    could go a great way toward alleviating the concern that I have
    about how this would operate in a way that would be
    counterproductive to the Agency.
        Senator Sununu. Commissioner Moore, are there any
    provisions in the legislation that you have concerns about, or
    that you'd like to see expanded or added to?
        Mr. Moore. I really have looked at the legislation
    carefully, and we've reviewed it carefully, and I think it
    offers some very positive steps for us to take, in terms of our
    ability to be effective in the consumer safety area. So, I
    don't see any problem with the legislation.
        Senator Sununu. Thank you, last question--there's a
    provision, Commissioner Nord, to authorize $20 million for
    upgrades to the lab in Gaithersburg. We saw a picture, and
    obviously it was a very cluttered space, where there were a lot
    of items on the bench--I don't think we should draw too many
    conclusions from one photograph, but I would guess that there
    are some specific needs. Any time you have a laboratory, you
    want to keep it as up to date as possible.
        Does the Commission have a blueprint or an idea of how that
    funding for laboratory space would be used? And what the
    priorities would be, if that funding were included in final
    legislation, and an appropriation bill?
        Ms. Nord. Is that to me?
        Senator Sununu. Yes.
        Ms. Nord. Oh, yes.
        We are now working very closely with GSA to try to find a
    real estate solution to the issues presented by the laboratory.
    It is out of date, it needs to be modernized. At one point, we
    were talking with GSA about basically tearing it down and
    rebuilding it. And, at that point--and this was about 5 or 6
    years ago, we were talking in the range of $20 million. If we
    were to reconstruct it, I think $20 million would probably be
    low.
        I think we can do it in a more cost-effective way, through
    a realistic solution to the problem. However, I do feel
    compelled to say to you, that even in a modern laboratory, the
    picture you saw of Bob and the drop test--that would still be
    the same. That test is used around the world in order to
    determine small parts. It's used in the most modern
    laboratories, and in our laboratories. So, that is the same
    test that you would be seeing, when we move into our new
    laboratory, which I hope will be soon.
        Senator Sununu. Thank you very much.
        Thank you, Mr. Chairman.
        Senator Pryor. Thank you.
        Senator Klobuchar, you're recognized for 5 minutes.
        Senator Klobuchar. Thank you, Commissioner Nord,
    Commissioner Moore. And, we're together again, Commissioner
    Nord, I think it's a third time. They say third time is a
    charm, hopefully not a lead charm.
        [Laughter.]
        Senator Klobuchar. I was trying to understand--I just
    couldn't resist--how you identify products to test and to
    recall. And, you know, I've been--Tamara Fucile who's my great
    staff member on this--these were her daughter's trains, and
    these were recalled on June 13. She, in fact, had a whole
    starter set for her daughter, which included this little tree,
    and this signal in the Thomas the Train set. And so, she
    dutifully gave these to me with which to go around the country.
        But, she found out that these other sets were recalled on
    September 26. So, she thought these were safe, even though they
    were in one grouping of toys that she bought together--and you
    can see how her daughter has chewed on these, on the corner of
    the tree--and, in fact this green paint, and this with the
    green paint as well, was recalled even though they were all in
    the same set, on September 26.
        And so, what I'm confused about is, if these were tested
    and we found out that this red paint had a problem, why these
    weren't recalled at the same time, when they were in the same
    set? And so, how do you identify the products that you need to
    test for a recall?
        Ms. Nord. Recalls occur in a variety of different ways.
    First of all, companies--because they do have an obligation to
    report to us, they do come to us and say, ``Look, we think
    we've got a problem.''
        When that happens, a couple of things can happen. First of
    all, we will sit down with the company and research it, and
    make a determination as to whether a recall should occur, or it
    shouldn't occur.
        Another way that recalls happen is that, if the company
    comes to us and says, ``Look, we believe that we have got a
    violation of,'' for example, ``the lead paint ban.'' We're
    going to do a recall. And it's something that they--they don't
    have a conversation with us about. They have decided to do it.
    That is what is called a ``fast track'' recall, and when that
    happens, we try to get those recalls accomplished within 20
    days of having the first conversation with the company.
        What happened with respect to the Thomas the Train Engine,
    I believe, is that the company--well, I know--the company came
    to us and said, ``We are going to be doing a recall of this
    product, because we have found lead paint in them.'' We
    facilitated that recall.
        Senator Klobuchar. But when they have the same items in the
    same set--doesn't that trigger some kind of testing
    requirement? When they've told you that this item has a
    problem, you don't test for the other items in the same set?
        Ms. Nord. No, the lead paint ban is a bright-line statutory
    ban. If they sell product with lead paint, then they are in
    violation of that.
        Senator Klobuchar. I understand that, but our country did
    not step in, and say that these other items should be recalled.
    It would seem it would be simple to test this green paint, and
    to find a set that was sold together like this.
        Ms. Nord. Our country stepped in and said, ``If you sell
    something with lead paint, you will be in violation of the law,
    and it will be recalled.''
        Now, after the June situation with Thomas the Train Engine,
    we did sit down and do a great deal of testing on these
    products. And, I'd be happy to get back to you as to why the
    green tree was or was not--there's a lot of misinformation out
    there about these particular products. But let me just find out
    what, actually, we did, and I'll respond to you. Be happy to.
        [The information previously referred to follows:]

    Thomas and Friends Product Testing
        The green tree was tested before the original recall of items in
    the Thomas and Friends Wooden Railway Toys set in June 2007, but the
    test did not show lead-containing paint. Later tests showed some green
    trees with lead-containing paint and some without; however, the firm
    decided to recall all of the green tree units without regard to
    production date. Accordingly, this item was added to the recall list on
    September 26, 2007. (http://www.cpsc.gov/cpscpub/prerel/prhtml07/
    07308.html).

        Senator Klobuchar. Thank you, my time is expired, and I
    appreciate that. We can talk about it more in the future.
        Senator Pryor. Senator McCaskill?
        Senator McCaskill. I recall, Ms. Nord, when you were here
    earlier this year in front of the Commerce Committee. And my
    recollection is--and I think the record will reflect this--that
    you indicated, in fact, testified, that the Fiscal Year 2008
    budget request was adequate for your needs. Is that correct?
        Ms. Nord. I testified that we were submitting a budget that
    laid out what we would be doing. That the monies that were
    being requested would be adequate to do the things that were
    laid out in that budget document.
        Senator McCaskill. But weren't you specifically asked if
    you needed more? And didn't you specifically say that you
    didn't?
        Ms. Nord. No. I believe I was asked--what I recall saying
    is that, with more I would do more.
        Senator McCaskill. But you didn't request more?
        Ms. Nord. We requested what was in the budget document. And
    that was, frankly, a unanimous vote of the Commission. So, my
    colleague and I made that request.
        Senator McCaskill. It's irrelevant whether it was unanimous
    or not. I'm trying to figure out how we get past the reality of
    the situation we're facing right now? We had a full Committee
    hearing concerning your agency, and there were no alarm bells
    signaled by anyone at your agency at that hearing that the
    facilities were inadequate, that the staff was inadequate. You
    all did not come to this Committee at that point in time and
    say, ``We've got all these problems out there.''
        Now, we have this scandal that has been uncovered in one of
    our Nation's largest newspapers, and here we are and I'm
    assuming that you will say today that you need more.
        Ms. Nord. Give me more, and we will spend it.
        Senator McCaskill. No, I'm not asking you--do you, do you
    believe to do your job--this is a very simple question. You are
    the leader of this agency. Do you believe that you need more to
    protect the American consumer, or not?
        Ms. Nord. I would like to have more resources, absolutely.
        Senator McCaskill. And are you requesting more resources to
    do your work?
        Ms. Nord. There is an appropriations bill that has been
    before the Senate and it gives us, I believe, another $7
    million. We will put that to very, very good use.
        Senator McCaskill. That's not my question. You will not--
    are you requesting more money for your Agency? Yes or no?
        Ms. Nord. Give me more money, and I will put it to good
    use, Senator.
        Senator McCaskill. Why can't you say you need more? What is
    the problem here? You have got the parents of America that are
    outraged that they are buying products from manufacturers like
    Mattel, the venerable Barbie doll, Thomas the Train, part of
    our cultural land of toys in America, and they are scared. And
    this article has exposed that you've got a corner of a room
    where you're testing toys, there are only 2 people working in
    the IG's office, your staff is back at the level it was in the
    1980s and you can't bring yourself to say, we need more?
        Ms. Nord. Senator, in March I did identify the problem with
    the laboratory in rather significant detail, I highlighted it
    at that point. I'm just so pleased to see that this Committee
    is authorizing significant amounts of money so that we can deal
    with that.
        Senator McCaskill. I think it's obvious that for some
    reason you are uncomfortable stating the obvious. And it really
    worries me about this agency and your unwillingness to state
    the obvious.
        Could you tell me the average length of time between the
    point in time you get notice of a potential recall, the average
    number of days between notice of a potential recall and recalls
    that have actually occurred?
        Ms. Nord. We do--in any given year, between 450 and 475 of
    them. Every one would be very different, I would need to----
        Senator McCaskill. I asked for the average.
        Ms. Nord. About half of our recalls are fast track recalls,
    which I've just described to Senator Sununu. They're done
    within 20 days of when the company comes in and starts talking
    to us.
        With respect to the other recalls, those are the much more
    complicated ones, and that can range from a few days to a year,
    or more than a year. It really depends on the complicated
    nature of the recall, the complexity of the issue, the kind of
    product that we're dealing with, but----
        Senator McCaskill. But if you had more staff, it could go
    more quickly, couldn't it? Maybe it wouldn't take a year if you
    had more help.
        Ms. Nord. If we had more staff, what we would be doing is
    probably--well, we would be--out there in the marketplace
    policing the marketplace in a more aggressive way, absolutely,
    ma'am. We would be on the Internet, we would be increasing the
    number of compliance officers we had. With more staff, we can
    do more, absolutely.
        Senator McCaskill. I want to assure you that, I think, for
    the majority of Congress you're not going to get in trouble for
    saying you don't have enough and that you need more.
        Thank you, Mr. Chairman.

                    STATEMENT OF HON. BILL NELSON,
                       U.S. SENATOR FROM FLORIDA

        Senator Nelson. Would the Senator yield?
        Senator McCaskill. If it's OK with the Chairman, he's in
    control, I think.
        Senator Pryor. Not necessarily.
        Senator Nelson. Yes, the Chairman's in control.
        Mr. Chairman, I just want to say to the Senator from
    Missouri, the reason the Chairman of the CPSC will not answer
    the question, is that she, as Chairman, as a political
    appointee, is not allowed to ask for more, because she is under
    the orders of the White House Budget Office only to ask for
    what is approved by the White House budget. And this isn't the
    only Agency that does this. We've got a huge amendment that's
    coming up on the floor on the Commerce, State, Justice
    Appropriations that directly affects me, and a lot of folks,
    including you in Missouri on NASA. And NASA can't request more,
    although they desperately need more. Because they've spent all
    of that money on the return to flight after the Space Shuttle
    Columbia's disaster.
        And so, why don't we just get to the nub of the coconut,
    which is, you can't ask for more even though you say you'll
    spend more, because you're under orders from the White House
    not to ask for more. Is that correct?
        Ms. Nord. I have never had a conversation like that with
    the White House, but----
        [Laughter.]
        Senator Nelson. Mr. Chairman----
        Senator Pryor. Go ahead.
        Senator Nelson. Well, there's one of them. Let's stipulate
    that once a product is recalled that it ought to be removed
    from the stream of commerce. But unfortunately, that has not
    happened.
        Here is Barbie's Dream Kitty Condo. And Barbie's Dream
    Kitty Condo has a kitty cat. And this product was still being
    sold over the Internet after it had been recalled--that was 2
    weeks after it had been recalled. Obviously, it's critically
    important to get these things out of circulation. This one was
    recalled because of the lead paint, as was this Thomas the
    Train because of the lead paint.
        So, what about the recalls. What is the CPSC doing to make
    sure that once the recall is made that you get them out of the
    stream of commerce?
        Ms. Nord. That is an excellent question, Senator, and I'm
    so pleased that you raised it, because it does highlight a
    weakness in the statutes that we are administering.
        I was rather surprised--to say the least--to realize that
    it is not a violation of the law to sell a recalled item,
    unless we would go through a process to declare it a
    substantial product hazard. That is why I suggested, and I'm so
    pleased to see in the Chairman's bill, a provision that would
    make it against the law to sell a recalled item. And, I hope
    that that provision is, indeed, enacted.
        Trying to get recalled products out of the stream of
    commerce is an incredibly difficult and complex thing, and you
    referenced the Internet. The Internet has made it more
    difficult, by orders of magnitude. We do have a relationship
    with the big auction houses, where they agree to not sell
    recalled items, or to take them down if they find them. But
    things slip through, and we are continually having those kinds
    of conversations with auction houses. When you get down to the
    smaller sellers, or individual sellers, it becomes a very, very
    difficult problem, and we have to address it on a case-by-case
    basis. But, I think the provision in the Chairman's bill that
    makes it against the law to do this will be very, very helpful.
        Senator Nelson. So, that's helpful, and that's another
    reason why we need to pass your bill.
        So, until this bill gets passed, and it becomes law, you're
    saying that you are powerless to deal with the items that have
    been recalled and are still out there in the stream of
    commerce?
        Ms. Nord. No, we're not powerless to deal with them, and
    with respect to----
        Senator Nelson. Well, tell us what?
        Ms. Nord. With respect----
        Senator Nelson. What powers do you have that enable you to
    deal with it now?
        Ms. Nord. With respect to, for example, the lead paint ban.
    They would be selling a product in violation of a regulation.
    So, they would be in violation of a standard. So, we would be
    able to bring an action against them. And, indeed, we do do
    that.
        With respect to things that are recalled because they are
    defective, but there is no regulation, at that point, we would
    have to make a determination that that was a substantial
    product hazard, and they would have had to have reported to us.
    So, what we would do would be to get them on a reporting
    violation. That's not the most graceful, easy way to enforce
    the law. So, again, I'm pleased to see that the Chairman has
    included this provision in his bill.
        Senator Nelson. OK, I'm reporting to you now that Barbie's
    Dream Kitty Condo is being sold on the Internet, after it has
    already been recalled. So, what power does the CPSC have to
    stop it being out there in the stream of commerce?
        Ms. Nord. And it's being recalled for a lead pain
    violation?
        Senator Nelson. Yes.
        Ms. Nord. It's in violation of the statute, and we will
    take enforcement action.
        Senator Nelson. There it is, right there.
        Ms. Nord. Thank you, Senator. We'll get right on it.
        Senator Nelson. All right.
        Ms. Nord. Sir, in fact, sir, if your office could give us
    the details, it would be helpful.
        Senator Nelson. OK. Well, other than what I've just told
    you. Mattel----
        Ms. Nord. Well, where did you buy it?
        Senator Nelson. On the Internet.
        Ms. Nord. Well, we need to have a website address.
        Senator Nelson. All right.
        Ms. Nord. Thank you.
        Senator Nelson. Have you asked manufacturers to make the
    process easier for consumers through incentives, to return
    products?
        Ms. Nord. In some cases, yes, indeed, we do do that. Each
    recall is different, and each recall is tailored to meet the
    particular issue that is presented to us. And in some cases,
    yes, indeed, we have required incentives.
        Senator Nelson. You've required them?
        Ms. Nord. Yes.
        Senator Nelson. Have you negotiated with manufacturers on
    voluntary corrective action plans?
        Ms. Nord. Of course, yes.
        Senator Nelson. You have?
        Ms. Nord. Of course.
        Senator Nelson. And as a result, have they said that
    they're going to get them out of the stream of commerce?
        Ms. Nord. Well, when you have a recall, that is what you're
    doing.
        Senator Nelson. But, in the secondary case, when they go
    back into the stream of commerce?
        Ms. Nord. They shouldn't be going--I'm not sure I'm
    following you. They shouldn't be going back into the stream of
    commerce if they've been recalled----
        Senator Nelson. But they are.
        Ms. Nord. Well, in that case, we would be going after them
    for a violation--we recently had a situation where we did
    recall a piece of clothing because it had a drawstring, which
    is a substantial product hazard, and the product ended up on
    the shelves, so we took enforcement action against the product
    seller. We do that from time to time, sure.
        Senator Nelson. In your testimony, you have expressed some
    concern over the part of this bill that would require third-
    party testing and certification of children's products.
        You stated that, ``the regulatory system set up for
    certifying and auditing testing laboratories seems to duplicate
    many of the functions of existing government and private
    organizations.''
        Ms. Nord. Yes.
        Senator Nelson. I want to show you a new photograph that
    you haven't seen.
        Ms. Nord. Oh, good.
        Senator Nelson. This is the CPSC.
        Ms. Nord. Yes.
        Senator Nelson. Does that please you?
        Ms. Nord. I've been testifying since I have been the acting
    Chairman of this agency that our lab needs to be modernized. We
    need a new laboratory.
        Senator Nelson. And yet, you don't want independent
    certification?
        Ms. Nord. No, I never said that.
        Senator Nelson. Well, in your testimony you stated, ``The
    regulatory system set up for certifying and auditing testing
    laboratories seems to duplicate many of the functions of
    existing government and private organizations.''
        Ms. Nord. No, what I am concerned about in the provision,
    and it may be just a function of, that we're not understanding
    what the drafters had in mind, but there is a whole structure
    out there for credentialing laboratories, certifying
    certifiers.
        For example, as I said in my oral statement, the National
    Institute of Standards and Technology under something they call
    NVCASE, National Voluntary Conformity Assessment Systems
    Evaluation Program--well, it's a program that they have where
    they certify the certifiers, and then a group like ANSI or A2LA
    will then certify the people that are actually doing the
    testing.
        And that process works fairly well, it's something that
    people are familiar with. And I would hope that under the
    construct of the Chairman's bill, something like that would not
    necessarily be precluded from the requirements. And there are
    people out there who know how to do this, and the CPSC does
    not. I mean, we have a testing laboratory, we test, but for us
    to certify other people to go do testing would be a brand new
    and, I think, rather resource-intensive process for us.
        So, what I'm saying is that I would hope that we could use
    all of the various resources that are out there, that are
    already looking at these issues, and not reinvent something
    from whole cloth. And I would hope that that was the Chairman's
    intention when he drafted the bill.
        Senator Nelson. Since 80 percent of these toys come from
    China, do you have any objection to independent certification
    before the toys would ever be shipped from China?
        Ms. Nord. Absolutely not. And, indeed, in the proposal that
    I sent to the Committee several months ago, I requested an
    amendment to the Federal Hazardous Substances Act so that we
    could indeed have certification authority.
        Senator Nelson. It's obvious that neither the Chinese
    government is going to police the toys--and it hasn't--nor is
    the Chinese industry going to police the toys--and it hasn't.
    So, isn't it logical that, since most of the toys are coming
    from China, to ensure that we don't have defective toys, that
    they get an independent certification such as one of those
    international laboratories that is well-recognized for its
    professionalism?
        Ms. Nord. Sir, I think that independent testing and
    certification is a very, very good way to assure product
    quality, as well as give the CPSC a very effective enforcement
    tool.
        Senator Nelson. Do you intend for the CPSC to take a
    position on that?
        Ms. Nord. On----
        Senator Nelson. What we've just been talking about, for the
    last 5 minutes?
        Ms. Nord. I am taking a position. As the Chairman. I would
    have to defer to my colleague.
        Senator Nelson. Well, I would assume that would be
    something you would present before the CPSC.
        OK, Mr. Chairman, thank you. You've been very kind with the
    time.
        Senator Pryor. Chairwoman Nord, let me ask you a few
    questions.
        First, you talk about the--some people call it ``fast
    track'' authority, some people call it ``relied upon'' or
    voluntary standards--you mentioned a few moments ago that you
    believe that the proper interpretation of the statute is for
    the CPSC to accept a voluntary standard and to try to make it
    enforceable, is that fair?
        Ms. Nord. In certain instances, I think we have the
    authority to do that.
        Senator Pryor. And has the CPSC done that?
        Ms. Nord. They did it--they have done it twice.
        Senator Pryor. And how long ago was that?
        Ms. Nord. It was back in the 1980s.
        Senator Pryor. Is there a reason why you haven't done it
    since you've been at the CPSC?
        Ms. Nord. I sought to do it once, but I was not able to get
    a majority vote in order to do it.
        Senator Pryor. And we understand the agency has had
    problems with quorum and all of that, so----
        Ms. Nord. No, I was not able to get a majority vote in
    order to do it.
        Senator Pryor.--let me ask about the full-time employees.
    As I understand it, today, you're authorized for 420 full-time
    employees, I believe. Do you know how many full-time employees
    you actually have?
        Ms. Nord. Well, it fluctuates--but at this point, we're
    down to around 400, under 400.
        Senator Pryor. And has that been the trend that the number
    of employees are going down?
        Ms. Nord. Well, our challenge was that under the
    President's budget we would have an FTE ceiling cap of 401
    employees.
        Senator Pryor. Yes.
        Ms. Nord. So, what we need to do is get down to that cap,
    unless our budget is different.
        Senator Pryor. Well, there again, we can talk about OMB and
    all of that----
        Ms. Nord. OK.
        Senator Pryor.--in another context, if you want to.
        You, I believe, mentioned in your opening statement and I
    know in the written testimony, as well--that you have some
    concerns about the Attorney General enforcement, the State
    Attorney General enforcement?
        Ms. Nord. Yes, I do.
        Senator Pryor. Right now, how are enforcement actions done,
    when you have to go to court--do you all do that or does the
    Department of Justice do that?
        Ms. Nord. The Department of Justice does it.
        Senator Pryor. And how many cases are referred to the
    Department of Justice every year? Give me a sense of that
    workload there.
        Ms. Nord. We have always an ongoing number of cases that
    goes up and down, probably 10 at any given time.
        Senator Pryor. I'd like to get into that in more detail at
    some point with you or your staff----
        Ms. Nord. Fine.
        Senator Pryor.--to figure out exactly how that's working
    right now, and how the Department of Justice is doing and how
    they prioritize it, and how they move things through the
    system, and how satisfied the Commission is about that.
        Let me also mention that there--what I perceive as an
    inconsistency in your testimony--and that is, when you talk
    about penalties, and we talk about whistleblowers and things
    like that, I think you mentioned that increased penalties might
    result in more information coming to the CPSC, but when you
    talked about the disclosure provisions in the bill, you talked
    about how that might mean less information coming to the CPSC.
    Could you clarify that? Maybe harmonize your testimony there?
        Ms. Nord. I'd be happy to.
        As I mentioned to Senator Sununu, under Section 15(b),
    companies are required to report to us if they become aware of
    a problem that could pose a defect. That's a very, very loose
    standard.
        What we tell companies is, when in doubt, report. We want
    to hear from them about issues and problems that may pose a
    problem, because once they report, we look at it, then we go
    back to them, ask for more information, work it through and
    then make a determination as to whether there's a real problem
    here, or if it is not a problem. So, that's what's happening
    under Section 15(b), and that's what we want to have happen.
        What I'm concerned about, under the penalties provision, is
    that if you increase the penalties so dramatically, as you have
    in your bill, companies will--out of an excess of caution, at
    least probably the big ones--not go through that process of
    trying to separate the wheat from the chaff, and we will get it
    all.
        And so, our compliance office is then going to be
    challenged to sort through the large amount of information we
    get, in order to figure out what's significant, and what isn't.
    And that, I think is going to overwhelm--I know, the compliance
    people have talked to me in great detail about their concerns
    about this provision, and how it may well overwhelm them.
        Right now, I think that the statute sets up a good counter-
    balance. It protects information that comes in that we use, and
    while we're using it. And once a recall occurs, then that
    protection goes away. If you feel that the penalties are too
    low, increase them. And indeed I suggested $10 million. But, I
    think $100 million may have the perverse effect of having
    companies basically send all their consumer complaints to us,
    and let us go through the process of figuring out what's
    important and what isn't.
        Senator Pryor. And, I think you referred to confidentiality
    when you were discussing this with Senator Sununu, I think you
    said that was your primary concern.
        But let me ask this--previously in other testimony, you
    also mentioned, you referred to NHTSA in another context. But
    NHTSA has a website where all of their complaints--as far as I
    can understand it--all of their complaints, no matter how valid
    or not they are, they go on the website and are open to the
    public for everybody to see. What's the downside of you all
    posting all of the complaints, just so John Q. Public can see
    what's being said about these various products? Whether valid
    or not, let the public sift through that. What's the downside
    of not following a NHTSA model there?
        Ms. Nord. Well, if we were to follow the NHTSA model, that
    would be fine, but what I would suggest to you is that we
    really have to follow the NHTSA model.
        When complaints come into NHTSA, it is at a much further
    point in the process. When somebody reports into NHTSA, it is
    because they have fully investigated the report, and they're
    ready to do a recall. So, that's one aspect of it.
        With respect to consumer complaints coming into NHTSA, Mr.
    Chairman, first of all, NHTSA is dealing with a much more
    defined jurisdiction than the CPSC is. We get about 30,000
    consumer complaints coming into our Agency every year. They
    come in, in various forms, many of them are not accurate. I'm
    not sure how the public would be benefited by learning about
    the fact that, you know, a person has complained about a coffee
    maker of Brand A, when actually it's Brand B, and the fire was
    started by faulty wiring in the home. That really doesn't help
    the consumer.
        So, I think if we're going to go that route, we need to
    spend Agency resources to make sure that the consumer
    complaints that go online have some meaning so that consumers
    are not mislead or confused by what's there.
        Senator Pryor. Well, we can check the facts on that, but
    you know, my understanding, and the Committee staff just
    reiterated it with me, is that consumer complaints are posted
    on the NHTSA website, for example, the one they gave me is with
    baby seats, car seats.
        [The information referred to follows:]

        Senator Pryor. But anyway, we can talk about that later.
    Let me ask one last question and that is, in your testimony you
    say, with respect to expanding our jurisdiction into non-safety
    areas, I point to the provision in Section 16, making it a
    violation of our Act to sell a counterfeit product--whether or
    not the product is safe--and to the provision referring to.
        Let me ask this--you have indicated in your testimony--both
    written and oral testimony--today that you feel like this bill
    that we've drafted gets us into non-safety areas. Maybe you and
    I just see it differently, but when it comes to the third-party
    certification to look at products, to make sure they meet our
    standards, to me that is a safety--I would not characterize
    that as a non-safety process. I mean, to me, you have a third-
    party that you all would lay out the parameters of what they
    need to be doing. They basically need to certify that these
    products--whatever they may be--meet U.S. safety standards, and
    to me, that is not a non-safety area. Could you elaborate on
    that?
        Ms. Nord. I couldn't agree with you more, sir. Third-party
    testing certification to product safety standards is something
    that I think needs to be implemented. And I am in wholehearted
    support of that, and will work cooperatively and
    enthusiastically to implement that kind of provision.
        What I was referring to is the provision in the amendment
    to Section 19 of our Act, dealing with prohibited acts, which
    would make it a violation of law to import a product with a
    false certification from a nationally-recognized testing
    laboratory. Which wouldn't necessarily go to safety, to a
    safety aspect.
        And all I'm suggesting is that that really is a false
    labeling issue, I think, more properly under the jurisdiction
    of the Federal Trade Commission. What you're basically having
    us do, is now police the marketplace against counterfeits. And
    while I am--I think that we need to do everything we can to get
    rid of counterfeits and protect intellectual property, I'm just
    not sure of the role of the CPSC is to do that, I think that's
    more properly the role of the Federal Trade Commission, and
    that's the only point I was trying to make there.
        Senator Pryor. I guess what would concern me there is if
    you take that position, and take it too literally, you're going
    to have a huge body of products that just fall between two
    camps: is it FTC or is it CPSC, and to me there's a very large
    safety component. And I'll admit, it's probably not present in
    every single case, but there's a very large safety component
    when it comes to counterfeit products. I think by their
    nature--I'm not saying they're unsafe by their nature--but I do
    think by their nature, they are not complying with globally
    recognized standards, just by them being counterfeit products
    and being mislabeled. Just on the outset, they're telling the
    world that they're not playing by everybody else's rules.
        Ms. Nord. I couldn't agree with you more. And frankly, when
    we see counterfeit goods, that's a flag to us. Then we do test
    them for safety. Because you're absolutely right--if something
    is counterfeit, there is a very good chance that it is also
    unsafe.
        But, our agency is looking at the safety aspect of it, not
    the consumer fraud piece of it. This is an interesting
    conundrum that our agency was in about a year ago, just as I
    was coming on the Commission, whereby we found a group of
    products that were counterfeit, and they were such good
    counterfeits that they were very, very safe. And that puts us
    into an odd situation, because we couldn't find a safety
    violation in those counterfeit goods.
        And I'm just trying to draw that distinction between
    counterfeiting--making us, having us enforce intellectual
    property laws, as opposed to safety laws.
        Senator Pryor. I want to thank both of you for your time
    today, and your testimony. Did you all have any other questions
    of this panel? Because I was going to move to the next panel.
        Senator Klobuchar. That's fine. Thank you.
        Senator Pryor. Is that OK? Thank you all for your time, and
    your testimony today. I'm sure we'll be back in touch. And by
    the way, we're going to leave the record open for two weeks,
    and allow Senators to submit questions in writing and we'd
    appreciate timely responses.
        What I'd like to do now is introduce the second panel.
    We're, right now, by the way as a floor update--we're waiting a
    little bit on the Senate, we understand that we may have votes
    at some point soon, but it's indefinite. So, we'll just plow
    through this and see how far we can go.
        But, I would like to introduce the third panel, now, which
    will be Mr. Ed Mierzwinski, Federal Consumer Program Director,
    U.S. PIRG; Mr. Travis Plunkett, Legislative Director, Consumer
    Federation of America; Mr. Alan Korn, Director of Public Policy
    and General Counsel, Safe Kids Worldwide; Mr. Joseph McGuire,
    President of the Association of Home Appliance Manufacturers,
    on behalf of the National Association of Manufacturers; and Mr.
    Al Thompson, Vice President for the Global Supply Chain Policy,
    Retail Industry Leaders Association.
        So you all, if you don't mind, take your seats, and as soon
    as we get everybody's microphones turned on and placards in
    place there, we'll go ahead and allow you all 5 minutes each
    for an opening statement.
        And I'm sorry--did I pronounce that right--is it
    Mierzwinski?

                    STATEMENT OF EDMUND MIERZWINSKI,

                       CONSUMER PROGRAM DIRECTOR,

                  U.S. PUBLIC INTEREST RESEARCH GROUP

        Mr. Mierzwinski. Senator, that's correct, that's the best
    it's been pronounced in Congress, ever.
        [Laughter.]
        Senator Pryor. All right. Well, thank you.
        Well, if you want to be our first testifier, please go
    ahead.
        Mr. Mierzwinski. Thank you very much, Chairman Pryor,
    Senator McCaskill, Members of the Committee.
        I'm Ed Mierzwinski and I'm with the U.S. Public Interest
    Research Group. We serve as the Federal lobbying office for an
    association of state public interest research groups with over
    a million members around the country.
        For 21 years, we have published a report on dangerous toys,
    and that report is called Trouble in Toyland. And Trouble in
    Toyland has resulted in over 120 recalls or other corrective
    actions by the Consumer Product Safety Commission or other
    manufacturers or other agencies. We would believe that it has
    actually resulted in more than 120 corrective actions from toys
    that we have discovered on the list, except that because of the
    notorious Section 6(b) of the Consumer Product Safety Act, the
    Commission does not always tell us what they do with the toys
    that we have put on the list, even though sometimes these toys
    have been on television stations, they've been listed in the
    newspapers, and they've certainly been posted on our website.
    So, we appreciate the provision in your bill that would fix
    Section 6(b).
        We would prefer to have Section 6(b) actually repealed, but
    we believe your bill goes a long way toward improving it.
        Your bill does three things that we think are critical to
    improving the Commission. First, it gives it the money and the
    opportunity to increase its staff that it needs to provide
    safety to the American public.
        Second, it holds the corporate wrongdoers accountable, by
    increasing civil penalties, making it harder for them to wiggle
    out of providing corrective actions, and a number of other
    things that it would provide to improve the operations of the
    CPSC.
        Second, your bill bans lead. It broadens--it very much
    broadens current lead bans that are in place for lead paint.
    Currently, except for lead paint, the CPSC must do an
    accessibility test in order to ban lead in any other product,
    including jewelry, and we support strongly the idea of banning
    lead in all children's products, particularly only down to
    trace levels.
        And we would encourage the Committee to look at the
    testimony before the House of the American Academy of
    Pediatrics last month. They've looked at all of the science,
    and they believe these doctors who have been in coalition with
    our organizations on a number of projects, that we can get lead
    levels down to 40 parts per million, not 200 parts per million,
    that's the trace amount in clean soil.
        So, we support your provision, and would encourage you to
    take a look at improving it even more.
        Third, the bill goes a long way toward improving the safety
    of imports. We very much support the third-party testing
    certification provision, and the other provisions about
    improving the safety of imports, and particularly the provision
    that gives the CPSC the authority to prevent recalled products
    from being dumped abroad, which is a problem that has surfaced
    in some of the research and the reporting that has been done
    over the summer, as a result of some of the problems with the
    CPSC.
        I also want to say that as an association of state
    organizations that strongly believes that the states should
    continue to serve as laboratories of democracy, and that we
    need 51 consumer cops on the beat, that is, 50 Attorneys
    General, as well as a Federal agency, that your expansion of
    Attorney General authority to enforce the Federal Consumer
    Product Safety Act and other Acts from the states is a very
    critical provision, and the provision that you have in the bill
    that says that stronger State laws are not preempted, is one
    that we can always, always support. And just like with toxics
    in children's products, we believe in the precautionary
    principle--Congress should set a floor, but the states should
    be allowed to go further.
        So, there are a number of provisions in your bill that we
    strongly support. We look forward to working with the Committee
    on the bill.
        There is one item that is not in my prepared testimony, it
    came to my attention, I've received a number of communications
    in the last day or so from eminent biochemists and some
    doctors, including burn doctors, who suggest that you should
    reevaluate Section 25 of the bill, which calls for an immediate
    furniture flammability standard. My organization has spent many
    years, and worked on many projects to get toxic chemicals--
    persistent bio-cumulative toxic chemicals out of products. And
    we have also worked on fire-safe cigarette laws.
        So, we care about burns and we care about toxic chemicals.
    These groups believe--and I'd like to enter some materials into
    the record if it's proper, that they've provided me--that we
    should take, and we'd be happy to work with the Committee to
    help those groups come before the staff, to talk about whether
    that section needs to be amended.
        [The materials previously referred to follow:]

                The Burn Center at Arkansas Children's Hospital
                                       Little Rock, AR, October 4, 2007
    Tate Heuer,
    Senior Legislative Assistant to Senator Mark Pryor,
    U.S. Senate,
    Washington, DC.

    Dear Mr. Heuer:

        I would like to share the concerns of the burn community about
    current Federal legislative and regulatory activity regarding
    upholstered furniture flammability in general, and an open flame
    standard for such flammability in particular.
        Our concern is highlighted in Section 25 of recently introduced
    reauthorization legislation related to the Consumer Product Safety
    Commission (CPSC), which proposes a deadline for action on this
    standard. Please share our concerns with the members of Senator Mark
    Pryor's Subcommittee on Consumer Affairs, Insurance, and Automotive
    Safety, in preparation for their meeting on October 4, 2007. As review
    of this proposed standard evolves in the coming months, I would also
    like to present the concerns summarized in this letter in greater
    detail either in person or in writing, as appropriate.
        I am writing as a practicing burn surgeon for the past 22 years,
    and the current Director of the Burn Center at the Arkansas Children's
    Hospital. Along with my 3,500 fellow members of the American Burn
    Association (ABA), I am familiar with both the causes and the impact of
    severe burn injury, and supportive of all worthwhile burn prevention
    efforts. The ABA, for example, was the first professional organization
    to support Federal legislation mandating the development of fire-safe
    cigarettes in 1979.
        The ABA has continually supported Federal studies and state
    legislation to support fire-safe cigarettes. However, many of us who
    are aware of the current draft of CPSC regulations related to
    upholstered furniture flammability standards, including the members of
    the ABA Burn Prevention Committee, have serious concerns about those
    regulations, as outlined in the CPSC'S proceeding entitled ``Ignition
    of Upholstered Furniture by Small Open Flames and/or Smoldering
    Cigarettes,'' issued as an advance notice of proposed rulemaking on
    October 23, 2003. Our concerns are summarized below and described in
    more detail in an attachment providing supporting evidence.

            1 Growing evidence of the increasing public health hazard
            represented by the flame retardant chemicals required for
            upholstered furniture to comply with TB 117.
            2. The magnified risk when ignition of FR-treated furniture
            occurs.
            3. Ineffectiveness of existing upholstered furniture
            flammability standard. (California's TB 117, on which the
            proposed Federal rule is modeled).
            4. Lack of technical success or priority in developing a
            Federal open flame standard.
            5. The resulting pending initiation of a major study of this
            issue by two highly regarded independent research
            organizations.
            6. Declining justification for a small open flame standard.
            7. Probable further decline in upholstery fire incidence, in
            the absence of a new standard.
            8. The emerging development of alternative approaches to
            furniture flammability.

        Thank you for your consideration of these concerns.
                Sincerely,
                           William L. Hickerson, M.D., F.A.C.S.
               Professor of Surgery/UAMS, Medical Director, Burn Center
                                     ______

                The Burn Center at Arkansas Children's Hospital
                                      Little Rock, AR, October 18, 2007
    Hon. Mark Pryor,
    Chair,
    Senate Subcommittee on Consumer Affairs, Insurance, and Automotive
                Safety,
    Washington, DC.

    Dear Senator Pryor:

        I write to share the concerns many of us in the burn community have
    in regards to the current Federal standard-setting activity about
    upholstered furniture flammability in general, and an open flame
    standard in particular. The reference is to a Consumer Product Safety
    Commission (CPSC) proceeding entitled ``Ignition of Upholstered
    Furniture by Small Open Flames and/or Smoldering Cigarettes'', issued
    as an advance notice of proposed rulemaking on October 23, 2003 and
    further discussed in the Commission's December 2005 briefing package.
        Our concern is highlighted in Section 25 of S. 2045, the recently
    introduced CPSC reauthorization legislation that proposes a June 2008
    deadline for action on this standard. While we appreciate the strong
    desire of both Congress and the Commission to conclude the lengthy
    consideration of this standard, we still have grave doubts whether a
    standard with such important potential long-range effect on public
    health should be addressed under a mandated deadline.
        The ABA has continually supported such legislation, which has now
    been enacted in at least 22 states. Now that such laws cover more than
    half the Nation's population, we fully expect the cigarette industry
    will soon decide to apply fire-safe technology to all U.S. production.
    CPSC's cost-benefit analysis however dismissed the likelihood that
    fire-safe standards would expand beyond the three states which had
    passed such laws by the end of 1995. This development has rendered
    obsolete the cost-benefit analysis on which the case for the proposed
    flammability standard is based.
        Although the new Federal standard might reduce the already small
    number of casualties, the burn community might still consider it
    another step forward were it not for serious concerns related to the
    potential hazards of flame retardant chemicals. Such chemicals are now
    used to meet the only existing regulation of furniture foam,
    California's TB 117, and their use would expand substantially under the
    proposed Federal standard. The ABA Burn Prevention Committee, for
    example, has recommended to the ABA Board of Trustees that the
    Association take a position opposing any standard that would depend on
    the use of chemicals whose safety to the environment and to public
    health could not be proven.
        Our concerns are summarized below and described in more detail in
    an attachment providing supporting evidence. In your upcoming mark-up
    of S. 2045, please consider if it is realistic for the Commission to
    complete rulemaking by June 2008. We are in a dynamic environment where
    the following factors either challenge the premise of the standard or
    will continue to evolve rapidly after that date:

            1. Growing evidence of the increasing public health hazard
            represented by the flame retardant chemicals used in
            upholstered furniture to comply with California TB 117.
            2. The magnified risk to firefighter health when ignition of
            FR-treated furniture occurs.
            3. Lack of evidence of effectiveness of the only existing
            upholstered furniture foam flammability standard, a state-level
            measure enacted in California in 1975.
            4. Declining statistical justification for a Federal standard
            since it was first proposed in 1994, and, independent of any
            additional standard setting, likely
            5. The imminent initiation of a major study of the upholstered
            furniture flammability issue by the National Fire Protection
            Association and Underwriters Laboratories.
            6. The very slow turnover of upholstered furniture in lower
            income households.
            7. The emerging development of alternative approaches to
            furniture flammability.

        Thank you for your consideration of these concerns.
                Sincerely.
                          William L. Hickerson, M.D., F.A.C.S.,
                                   Professor of Surgery, UAMS Director,
                                                           ACH Burn Center.
                                   Attachment
    Concerns Regarding CPSC Proposed Small Open Flame Upholstery
            Ignition Standard
        1. Growing evidence of the health risk from flame retardant
    chemicals. Brominated and chlorinated chemicals, the most common flame
    retardant chemicals, have been found in increasing levels in the
    environment and in mothers' milk. These levels approach those
    associated with neurological and reproductive deficits, endocrine
    disruption and cancer in animal studies. When incorporated into
    manufactured products, these chemicals do not remain encased in those
    products, but gradually release and migrate into the indoor
    environment, dust, and human's bodies where they represent a
    significant threat to public health.\1\
    ---------------------------------------------------------------------------
        \1\ Thomas McDonald, Ph.D., ``Polybrominated Diphenylether Levels
    in U.S. Residents: Daily Intake and Risk of Harm to the Developing
    Brain and Reproductive Organs'', Integrated Environmental Assessment
    and Management, 2005. v.1:4, 343-354. (contains extensive bibliography
    on environmental impact of brominated chemicals).
    ---------------------------------------------------------------------------
        The current method of achieving small open flame resistance, the
    standard for foam flammability contained in the current draft of the
    proposed CPSC standard, is to incorporate substantial quantities of
    these chemicals into the upholstery fabric and/or the flexible
    polyurethane foam used in upholstered furniture padding.\2\ As a result
    of the only existing state standard, California homes, pets and people
    now have high levels of toxic fire retardant chemicals. These
    chemicals, since their introduction as flame retardants around 1980,
    have also been associated with a growing incidence of hyperthyroid
    disease in domestic cats. Furthermore, studies are underway at the U.S.
    EPA and UC Davis on a possible link between fire retardant chemicals
    and autism.
    ---------------------------------------------------------------------------
        \2\ ``An Evaluation of the CPSC Staff Preliminary Regulatory
    Analysis of the Draft Upholstered Furniture Flammability Standard,''
    CRA International, Oakland, CA, March 2006. (prepared for the American
    Home Furnishings Alliance), 106 pp.
    ---------------------------------------------------------------------------
        2. Magnified risk when ignition occurs. Upholstered furniture
    ignition standards are based only on the ability of furniture
    components to delay becoming the initial item ignited. They do not
    protect furniture from igniting in a conflagration that begins
    elsewhere in a residence or commercial structure. Such was the case in
    the tragic May 2007 furniture store fire in South Carolina, which began
    outside the store and killed nine firefighters. (I don't understand the
    connection of the previous sentence to the point. You might want to
    say. Similar hear is given off from combustion of furniture with and
    without added FR chemicals.) When released in a fire, such chemicals,
    already known as a threat to firefighter health,\3\ add further to the
    toxic chemical burden in the environment.
    ---------------------------------------------------------------------------
        \3\ Grace LeMasters, Ph.D., et al., ``Cancer Risk Among
    Firefighters: A Review and Meta-Analysis of 32 Studies,'' Journal of
    Occupational and Environmental Medicine, 48: 11, 1189-1202. (contains
    extensive bibliography).
    ---------------------------------------------------------------------------
        3. Lack of evidence of effectiveness of existing foam flammability
    standard. (California's TB 117, on which the proposed Federal rule is
    modeled). The only existing standard requiring resistance to open flame
    ignition of the flexible polyurethane foam used in the padding of
    upholstered furniture has been in effect in California since 1975.
    Since the fire and death rate in fires first ignited in upholstery has
    not decreased any more rapidly in California than in the rest of the
    country since 1985,\4\ there is no proof that this standard has
    contributed to this decline, nor that any tightening of this standard
    would contribute to such a decline in the future.
    ---------------------------------------------------------------------------
        \4\ Kimberley Rohr, ``Products First Ignited in U.S. Home Fires'',
    National Fire Protection Association, Quincy, MA, April 2005, 131 pp.
    ---------------------------------------------------------------------------
        4. Declining Justification for a ``Small Open Flame'' Standard.
    Deaths in fires in which upholstered furniture was the first item
    ignited have decreased 80 percent since a voluntary flammability
    standard was first adopted by furniture manufacturers in the early
    1980s,\5\ and 50 percent since a mandatory Federal standard was first
    proposed in 1994. By 2004, such deaths had declined to an estimated
    550, over 90 percent caused by cigarettes and just 10 percent from open
    flames. The most recent statistics, for the year 2004, estimate a
    decline of 50 percent from approximately 1,300 to 650.\6\ The trend
    line of the decline in such deaths closely matches that of decline in
    smoking in the general population.
    ---------------------------------------------------------------------------
        \5\ Upholstered Furniture Action Council (UFAC) Standard, later
    modified and published as ASTM Standard 1351E (see www.UFAC.org)
        \6\ CRA International, op. cit. 2006.
    ---------------------------------------------------------------------------
        Although the ``small open flame'' standard, representing only an
    estimated 15 percent of fires originating in upholstery, is not
    directed at fires started by cigarettes themselves, the decline in
    smoking has reduced the presence of the major sources of such flames
    which are likely to come in contact with upholstered furniture, namely,
    matches and cigarette lighters. The resulting reduced estimate of open
    flame-ignited fires originating in upholstery is now so low (averaging
    40 a year in the years 1999-2003) \7\ that its statistical significance
    is highly questionable.
    ---------------------------------------------------------------------------
        \7\ Rohr, op. cit.
    ---------------------------------------------------------------------------
        5. The pending initiation of a major study of this issue by two
    highly regarded independent research organizations. The National Fire
    Protection Association and Underwriters Laboratories are about to
    embark on a major study of upholstered furniture flammability,
    beginning with a review of the very sketchy data available on the
    subject.
        The study, expected to take 18 months, began with a public briefing
    hearing at NFPA headquarters in Quincy, MA on October 17.\8\ The
    apparent need for such a study by the Nation's major independent fire
    protection and product evaluation organizations calls into question the
    appropriateness of both the CPSC's current draft standard and the
    proposed June 2008 deadline for final rule-making on this standard.
    ---------------------------------------------------------------------------
        \8\ NFPA-UL Upholstery Flammability Study October 17 Briefing
    Session agenda. National Fire Protection Association, Quincy, MA.
    ---------------------------------------------------------------------------
        6. The emerging development of alternative approaches to
    upholstered furniture protection. Legislation introduced in California
    in 2006 would ban the entire class of brominated and chlorinated
    chemicals currently used as flame retardants. In place of these
    chemicals, AB 706 enables the California Bureau of Home Furnishings and
    Thermal Insulation (the only such state-level organization in the
    country) to develop alternative methods to protect the public against
    fire risk involving upholstered furniture.\9\ Although AB 706 was
    narrowly defeated in the California Senate earlier this month in its
    first legislative test, it has gained considerable momentum and will no
    doubt be revived in future sessions of the CA General Assembly.
    ---------------------------------------------------------------------------
        \9\ AB 706 Fact Sheet, Office of Senator Mark Leno, Sacramento, CA,
    as amended 08-27-07.
    ---------------------------------------------------------------------------
        Potential alternative approaches identified by AB706 proponents and
    described in a series of conferences on the flame retardant dilemma in
    Berkeley in 2007 include alternative non-toxic chemicals, furniture
    design changes, and the adoption of a policy testing the flammability
    risk of the entire item of furniture, rather than its individual
    components.\10\
    ---------------------------------------------------------------------------
        \10\ View ``Fire Retardant Dilemma'' conference presentations (Nos.
    1 through 3, January, April and September 2007) at http://
    www.greensciencepolicy.org/conferences.
    ---------------------------------------------------------------------------
                                     ______

                 AB 706 (Leno)--Fact Sheet--As amended 08-27-07

     The Crystal Golden-Jefferson Furniture Safety and Fire Prevention Act

    Coauthors: Assembly Members Bass, Berg, Brownley, DeSaulnier, Hancock,
              Hayashi, Huffman, Jones, Lieber, Ruskin, and Swanson

    Purpose
        The California Furniture Safety and Fire Prevention Act will reduce
    the threat from fires and health impacts caused by toxic chemical fire
    retardants. The bill requires the Bureau of Home Furnishings and
    Thermal Insulation to modify fire safety standards for furniture in a
    manner that delivers equivalent fire safety without the use of certain
    toxic chemicals and institutes updated furniture labeling requirements.
    It also institutes a process for the Bureau to obtain recommendations
    on toxicity concerns from the California Office of Environmental Health
    Hazard Assessment and creates a reconsideration process for any
    component or chemical prohibited by the bill.
    Summary
        AB 706 requires the Bureau of Home Furnishings and Thermal
    Insulation to improve fire safety standards for furniture such that
    equivalent fire safety is achieved with reduced use of chemical fire
    retardants. Current furniture standards are applied to the component
    parts of furniture such as fabric or polyurethane foam and do not
    reflect the reality of how fires start or burn.
        One possible solution is a furniture construction standard that
    achieves equivalent fire safety and reduced chemical loading thus
    minimizing both fire and chemical exposure risks. AB 706 leaves the
    actual standards to the experts through the regulatory process, but
    does require that the most toxic chemicals not be used.
        This bill would prohibit from seating furniture, mattresses, and
    bedding products selected toxic chemicals known as brominated fire
    retardants (BFRs) and chlorinated fire retardants (CFRs) that may cause
    reproductive, developmental, neurological or other health problems
    including cancer, birth defects, learning disorders, and mental
    retardation.
        AB 706 requires the Bureau to modify existing standards for fabric
    and foam used in upholstered furniture in a manner that maintains
    equivalent levels of fire retardancy while eliminating the use of BFRs
    and CFRs.
        This bill creates a process whereby the Bureau may obtain health
    and environmental information for fire retardant chemicals and, if
    determined by the Bureau to be necessary, prohibit use of fire
    retardant chemicals in furniture that cause harm to animal or human
    health. Any component or chemical prohibited by this process or by the
    provisions of this bill may be reconsidered based on new data.
        The bill requires a consumer awareness label that states ``DOES NOT
    CONTAIN BROMINATED OR CHLORINATED FIRE RETARDANTS.'' This is intended
    to help consumers discern which furniture is safe for human use.
    Comments
        California has one of the most stringent fire retardance standards
    in the world for furniture, mattresses, and box springs, and is
    currently developing new regulations to require the use of fire
    retardant chemicals in pillows, comforters, futons, and other bedding
    products. To meet existing furniture, mattress, and box spring
    standards, many manufacturers employ fire retardant chemicals.
    Serious Health Concerns--Children at Risk
        Two classes of these chemicals, brominated fire retardants and
    chlorinated fire retardants, can cause serious toxic effects including
    cancer, developmental impairment, birth defects, and endocrine and
    reproductive dysfunction, often at extremely low doses.\1\ \2\ Infants
    and children are particularly likely to absorb these fire retardant
    chemicals through direct physical or oral contact with these compounds
    in furniture, bedding, and mattresses, or through inhalation of dust
    and ingestion of these substances from their mothers' milk and from
    their diets.\3\
    ---------------------------------------------------------------------------
        \1\ Linda S. Birnbaum, Daniele F. Staskal; 2004 Brominated Flame
    Retardants: Cause for Concern? Environmental Health Perspectives, Vol.
    112.
        \2\ Gundersen Y., Vaagenes P., Reistad T., Opstad P.K.., Brominated
    Flame Retardants May Cause Brain Injuries In The Fetus And The Newborn,
    Tidsskr Nor Laegeforen.; 2005 Nov. 17125(22):3098-100.
        \3\ Jones-Otazo, H.A.; Clarke, J.P.; Diamond, M.L.; Archbold, J.A.;
    Ferguson, G.; Harner, T.; Richardson, G.M.; Ryan, J.J.; Wilford, B., Is
    house dust the missing exposure pathway for PBDEs? An analysis of the
    urban fate and human exposure to PBDEs. Environmental Science &
    Technology 2005, 39, (14), 5121-5130; Stapleton, H.M.; Dodder, N.G.;
    Offenberg, J.H.; Schantz, M.M.; Wise, S.A., Polybrominated diphenyl
    ethers in house dust and clothes dryer lint. Environmental Science &
    Technology 2005, 39, (4), 925-931.
    ---------------------------------------------------------------------------
    A New Approach to Fire Safety
        California can achieve similar or even superior fire safety without
    the use of brominated or chlorinated fire retardants. Current fire
    safety standards test interior foam filling separately from fabric,
    batting, and other components without consideration of the realities of
    how furniture fires actually start. This approach is a de facto mandate
    to use the most toxic fire retardants.
        Improved furniture design, the use of chemicals that are safer for
    human health and the environment, and the implementation of an
    integrated furniture construction standard to replace outdated tests
    should over time lead to further increases in furniture safety.
    Furthermore, prohibiting BFRs and CFRs from use in furniture will spur
    industry innovation in fire safety through ``green chemistry'' that is
    safer for human and animal health and the environment.\4\
    ---------------------------------------------------------------------------
        \4\ Wilson M., Chia D., Ehlers B.. Green Chemistry in California: A
    Framework for Leadership in Chemicals Policy and Innovation. Special
    Report to the California Legislature, University of California Policy
    Research Center and the Center for Occupational and Environmental
    Health, University of California, Berkeley. March 2006 (http://
    coeh.berkeley.edu/news/06_
    wilson_policy.htm).

    Regulatory History
        In 1977 and 1978 articles in the academic journal Science showed
    that brominated and chlorinated Tris, the two major flame retardants
    used in children's sleepwear, were mutagens (that means they changed
    DNA) and that brominated Tris was absorbed into children's bodies from
    their pajamas.\5\ After the National Cancer Institute found brominated
    Tris to be a potent carcinogen in animals, the Consumer Product Safety
    Commission forced manufacturers to stop using either form of Tris in
    children's sleepwear.
    ---------------------------------------------------------------------------
        \5\ A. Blum and B.N. Ames, Flame Retardant Additives as Possible
    Cancer Hazards: The Main Flame Retardant in Children's Pajamas is a
    Mutagen and Should Not Be Used. Science 195, 17 (1977); M.D. Gold, A.
    Blum, B.N. Ames, et al., Another Flame Retardant, Tris-(1,3-Dichloro-2-
    Propyl)-Phosphate, and Its Expected Metabolites and Mutagens. Science
    200, 785 (1978).
    ---------------------------------------------------------------------------
        In 1975 California instituted Technical Bulletin 117 which requires
    all polyurethane foam used as filling in seating furniture to pass
    stringent fire safety testing. It was the first (and to date the only)
    state in the Nation to have such a standard.
        Today, chlorinated Tris, one of the same chemicals removed from
    children's pajamas in the 1970s is widely used in furniture sold in
    California to meet the standards of TB 117. This chemical has recently
    been determined by the Consumer Product Safety Commission to be ``a
    probable human carcinogen based on sufficient evidence in animals.''
    \6\ The other most widely used chemical fire retardant, Firemaster 550,
    is highly ecotoxic according to a U.S. EPA study.\7\
    ---------------------------------------------------------------------------
        \6\ Michael Babich, Dec. 21, 2006, Peer Reviewed CPSC Staff
    Research Reports on Upholstered Furniture Flammability, page 12.
        \7\ Furniture Flame Retardancy Partnership: Environmental Profiles
    of Chemical Flame-Retardant Alternatives for Low Density Polyurethane
    Foam Volume 1. U.S. Environmental Protection Agency report EPA 742-R-
    05-002A, page 4-3, September 2005.
    ---------------------------------------------------------------------------
    Leapfrogging From One Toxic to Another
        Due to their potential harm to human health and the environment,
    two categories of fire retardants known as pentabrominated diphenyl
    ether (PentaBDE) and octabrominated diphenyl ether (OctaBDE) have been
    banned by the State of California for use at levels higher than one-
    tenth of 1 percent in virtually all new products, including furniture
    and the plastic housings of electronics, computers, and circuit boards
    as a result of AB 302 (Chan) enacted in 2003 and AB 2587 (Chan) enacted
    in 2004. If California were to ban the two most widely used fire
    retardant chemicals in furniture, other chlorinated and brominated
    replacements currently being considered to replace them would also pose
    hazards to human health and the environment.
        Our objective is to prevent senseless and shortsighted leapfrogging
    from one toxic chemical to another by prohibiting the entire classes of
    brominated and chlorinated fire retardants. This bill takes that step,
    but in a modest way by prohibiting BFRs and CFRs from the products with
    the most intimate human contact, such as the chair you may be sitting
    on now or the bed your children will sleep on tonight.
    Fire Retardants in Humans
        Since the discovery of carcinogenic Tris byproducts in the urine of
    children wearing fire retardant pajamas thirty years ago, other fire
    retardants have been found in people's bodies. For example,
    polybrominated diphenyl ethers (PBDEs), a subcategory of brominated
    fire retardants, have increased forty-fold in human breast milk since
    the 1970s.

        Levels of PBDEs have increased forty-fold in human breast milk
    since the 1970s. Women in North America on average have ten times the
    levels of women in Europe or Asia.\8\ PBDEs have the potential to
    disrupt thyroid hormone balance and contribute to a variety of
    neurological and developmental deficits, including low intelligence and
    learning disabilities.
    ---------------------------------------------------------------------------
        \8\ Lunder S., Sharp R.. 2003. Mothers' Milk: Record levels of
    toxic fire retardants found in American mothers' breast milk.
    Environmental Working Group (www.ewg.org/reports/mothersmilk/).
    ---------------------------------------------------------------------------
    Structurally Like Other Toxics
        PBDEs are structurally half way between polybrominated and
    polychlorinated biphenyls (PBBs and PCBs) and dioxins and furans which
    are known to cause cancer and are prohibited in the United States.
        Human health effects from exposure to these related chemicals
    include a broad range of developmental and cognitive deficits.\9\ For
    example, maternal exposure to PCBs causes long-lasting deficits in
    learning, memory, IQ, and attention span in infants and children.\10\
    Similar harmful effects are found in animals exposed to PBDEs.\11\
    ---------------------------------------------------------------------------
        \9\ L.S. Birnbaum, D.F. Staskal, J.J. Diliberto, September 2003,
    Health effects of polybrominated dibenzo-p-dioxins (PBDDs) and
    dibenzofurans (PBDFs)--Environment International, Volume 29, Number 6,
    pp. 855-860(6).
        \10\ Jacobson J.L., Jacobson S.W.. 2003. Prenatal exposure to
    polychlorinated biphenyls and attention at school age. J Pediatr: 2003
    Dec. 143(6):780-8.
        \11\ Viberg, H.; Fredriksson, A.; Jakobsson, E.; Orn, U.; Eriksson,
    P., Neurobehavioral derangements in adult mice receiving decabrominated
    diphenyl ether (PBDE 209) during a defined period of neonatal brain
    development. Toxicological Sciences 2003, 76, (1), 112-120.

        Brominated furans and dioxins exhibit similar carcinogenicity and
    toxicity to chlorinated ones.\12\ Given the similarity in chemical
    structures, it is probable that PBDEs will have similar human health
    effects as those of PCBs, PBBs, dioxins and furans. Continuing to
    expose our children to this class of chemicals in furniture,
    mattresses, and bedding constitutes an exposure risk we should not be
    taking.
    ---------------------------------------------------------------------------
        \12\ L.S. Birnbaum, D.F. Staskal, J.J. Diliberto: Health Effects of
    Polybrominated dibenzo-p-Dioxins (PBDDs) and Dibenzofurans (PBDFs).
    Environmental International, Volume 29, Number 6, pp. 855-860(6)
    (September 2003).
    ---------------------------------------------------------------------------
    Chemical Bans
        The European Union and many U.S. states have banned two brominated
    PBDE chemicals known as pentaBDE and octaBDE. These states include:
    California, Hawaii, Illinois, Maryland, Maine, Michigan, New York,
    Oregon, and Rhode Island. This year Washington State and Maine passed
    bans on decaBDE which is another brominated PBDE chemical. DecaBDE was
    recently banned in Sweden, and is in the process of being banned in the
    EU.
    Climbing the Food Chain
        Apart from toxic effects in humans from direct exposures,
    brominated and chlorinated fire retardants have been disposed of in
    ways that contaminate soils, groundwater, drinking water, ambient air,
    our oceans, and other natural ecosystems. These chemicals have also
    been detected at high concentrations in animals and fish, as well as
    marine mammals such as dolphins and harbor seals, indicating that they
    are already bioaccumulating in the food chain and in marine
    wildlife.\13\ \14\ \15\ Fish and meat consumption are partly
    responsible for increasing levels of some these chemicals in humans.
    ---------------------------------------------------------------------------
        \13\ Johnson-Restrepo, B.; Kannan, K.; Addink, R.; Adams, D.H.,
    Polybrominated diphenyl ethers and polychlorinated biphenyls in a
    marine foodweb of coastal Florida. Environmental Science & Technology
    2005, 39, (21), 8243-8250.
        \14\ Christensen, J.R.; Macduffee, M.; Macdonald, R.W.; Whiticar,
    M.; Ross, P.S., Persistent organic pollutants in British Columbia
    grizzly bears: Consequence of divergent diets. Environmental Science &
    Technology 2005, 39, (18), 6952-6960.
        \15\ Voorspoels, S.; Covaci, A.; Lepom, P.; Escutenaire, S.;
    Schepens, P., Remarkable findings concerning PBDEs in the terrestrial
    top-predator red fox (Vulpes vulpes). Environmental Science &
    Technology 2006, 40, (9), 2937-2943; Chen, D.; Bixian, M.; Song, J.;
    Suin, Q.; Zeng, E.; Hale, R.C. In Polybrominated Diphenyl Ethers in
    Birds of Prey Collected from Northern China, SETAC, Montreal, Quebec,
    2006; Montreal, Quebec, 2006; Peter S. Ross, Fireproof Killer Whales
    (Orcinus orca): Flame Retardant Chemicals and the Conservation
    Imperative in the Charismatic Icon of British Columbia, Canada. Journal
    of Fisheries and Aquatic Sciences, Volume 63, Number 1, pp. 224-234
    (11) (January 2006).
    ---------------------------------------------------------------------------
        Over the last thirty years, there have been hundreds of scientific
    journal articles and reviews citing these and other negative health
    impacts in people and/or in animals resulting from exposure to
    brominated and chlorinated fire retardants.
        Distribution of tens of millions of pounds of fire retardant
    chemicals annually in California represents an ongoing danger to public
    health and the environment all without an adequate scientific
    understanding of the long-term consequences of exposure. Workers
    involved in fire retardant and furniture production may be at even
    higher exposure risks.\16\ \17\
    ---------------------------------------------------------------------------
        \16\ Thuresson, K.; Bergman, A.; Jakobsson, K., Occupational
    exposure to commercial decabromodiphenyl ether in workers manufacturing
    or handling flame-retarded rubber. Environmental Science & Technology
    2005, 39, (7), 1980-1986.
        \17\ Thuresson, K.; Hoglund, P.; Hagmar, L.; Sjodin, A.; Bergman,
    A.; Jakobsson, K., Apparent half-lives of hepta- to decabrominated
    diphenyl ethers in human serum as determined in occupationally exposed
    workers. Environmental Health Perspectives 2006, 114, (2), 176-181.
    ---------------------------------------------------------------------------
    Replacements Brominated and Chlorinated Fire Retardants
        Substantial efforts to eliminate brominated and chlorinated fire
    retardants such as brominated and chlorinated Tris, PentaBDE, OctaBDE,
    DecaBDE, PBBs, and PCBs from products have been made throughout the
    world, including the private and public sectors. These efforts have
    made available replacements substantially safer to human health while
    meeting fire safety standards.
        Improved furniture design and AB 706's smarter approach to
    furniture fire performance standards may lead to further increases in
    furniture safety in the future.
        Rather than loading furniture cushions with up to 10 percent fire
    retardants by weight in order to comply with California Technical
    Bulletin 117, many manufacturers would like to utilize innovations such
    as fire resistant foam cushion wraps, health and eco friendly ``green
    chemistry'' retardant alternatives, use of fire resistant materials
    such as wool blends and synthetics, or other structural barriers such
    as polyester batting that provide similar or better fire safety
    performance without toxicity.
        Simply requiring foam filling to delay burning for 12 seconds when
    exposed to a small open flame is an old approach that needs to be
    updated to reflect the reality of how fires start and burn.
    Fire Fighter Toxicity Risk
        When brominated and chlorinated fire retardants burn after a
    momentary resistance to open flame, they release a dark smoke that
    greatly reduces visibility for fire fighters.
        An additional concern for fire fighters when fire retarded
    furniture burns is that brominated fire retardants are converted into
    dioxin and furans, exposing firefighters to dangerous levels of these
    extremely toxic and cancer-causing chemicals.\18\ Firefighters are at
    particular risk during the clean up or ``overhaul'' of a burn site when
    the need for protective gear may not be apparent. Skin contact with
    soot that contains dioxin and furans from combusted brominated fire
    retardants is a key route of exposure to firefighters.
    ---------------------------------------------------------------------------
        \18\ Gunilla Soderstrom, 2003, On The Combustion And Photolytic
    Decomposition Of Some Brominated Flame Retardants, Thesis, University
    of Umea, Sweden.
    ---------------------------------------------------------------------------
    Fire Fighter Cancers
        An analysis of 32 studies was published last November in the
    Journal of Occupational and Environmental Medicine. The analysis found
    firefighters had significantly elevated rates for four types of cancer:
    multiple myeloma, non-Hodgkin's lymphoma, prostate, and testicular
    cancer.
        Eight additional cancers including malignant melanoma and brain
    cancer were determined to have a ``possible'' association with
    firefighting.\19\ The authors also concluded that firefighter risk for
    the four most common cancers could be related to their exposures to
    complex mixtures such as the toxic products created when brominated and
    chlorinated fire retardants burn.
    ---------------------------------------------------------------------------
        \19\ LeMasters G.K., et al, December 2006, Cancer risk among
    firefighters: a review and meta-analysis of 32 studies, J. Occup.
    Environ. Med. 2006 Nov; 48(11): 1189-202.
    ---------------------------------------------------------------------------
        Due to elevated levels of cancer among firefighters, the California
    Professional Fire Fighters, the California State Firefighters
    Association, San Francisco Fire Fighters local 798, the San Francisco
    Fire Marshal, and other locals support AB 706.
    Crystal Golden-Jefferson
        On July 20, 2005, a Los Angeles County Fire Department firefighter
    named Crystal Golden-Jefferson passed away from work place related non-
    Hodgkin's lymphoma. She was a single mother and a dedicated paramedic
    firefighter with 19 years of service to the people of Los Angeles
    County. While the cause of Crystal Golden-Jefferson's cancer can not be
    definitively linked to dioxin exposure, dioxins are known to cause non-
    Hodgkin's lymphoma and Crystal Golden-Jefferson was regularly exposed
    to soot and smoke in her work.
        In the naming of AB 706, it is the intent of the Legislature to
    honor Crystal Golden-Jefferson and other fire fighters who, like her,
    have lost their lives due to toxic chemical exposure and workplace
    related cancers. Removing from furniture chemicals that convert into
    carcinogenic dioxins and furans during fires can reduce workplace
    exposures and cancer risk for fire fighters who bravely sacrifice their
    lives so that others may live.
    Fire Safety Improving For Other Reasons
        Fires started from residential furniture or mattresses have
    decreased in recent years due to:

       Fire safety education,

       Improved electrical and building codes,

       Increased use of smoke detectors and building sprinkler
            systems,

       Mandated ``fire-safe'' cigarettes with lower ignition
            propensity, and

       General decreases in smoking.

        In 2005, California passed AB 178 (Koretz) requiring all cigarettes
    sold in California be fire-safe by January 2007. Today, the Bureau of
    Home Furnishings and Thermal Insulation has difficulty finding
    cigarettes that will smolder long enough in order to conduct the
    smoldering test required in Technical Bulleting 117.
    Are We Really Getting More Safety?
        Despite our being the only state with furniture flammability
    standards, California has not reduced fire deaths more than other
    states during the years that our standard has been in effect. A
    comparison of fire deaths by the National Fire Prevention Association
    of 5-year averages among the most populous states showed California was
    statistically equal to states without the tough furniture standard.\20\
    ---------------------------------------------------------------------------
        \20\ John R. Hall Jr., U.S. Unintentional Fire Death Rates By
    State, Fire Analysis and Research Division, National Fire Protection
    Association, Ouincy, MA, June 2006.

    Fire Safety Standards a Good Idea
        Fire safety standards for furniture can reduce fire hazard, but
    they must be updated to ensure we are not causing adverse long term
    health impacts like cancer and neurological problems that can adversely
    affect far more people. The Bureau of Home Furnishings and Thermal
    Insulation should have the authority to weigh these issues in
    consultation with toxics experts at the California Office of Health
    Hazards Assessment in order to best protect public safety from fires
    and public health from chemical risks.
    Smarter Regulation = More Safety
        AB 706--The California Furniture Safety and Fire Prevention Act
    will:

       Provide the furniture industry more options for creating
            safe and affordable furniture,

       Create opportunities for green chemistry innovation,

       Reduce workplace exposure to toxic chemicals for furniture
            industry workers and fire fighters,

       Remove toxic brominated and chlorinated chemicals from
            products that come in direct contact with our families,
            animals, and the environment, and

       Protect human and environmental health both now and for
            future generations.

        All this can be done by smarter regulations developed with an eye
    toward protecting overall public health and fire safety.
    Status
        Held in Senate Appropriations Committee.
    Votes
        4-10-07  Passed Assembly Environmental Safety & Toxic Materials
    Committee in a vote of 5-2.
        4-17-07  Passed Assembly Business & Professions Committee in a vote
    of 7-3.
        5-31-07  Passed Assembly Appropriations Committee.
        6-6-07  Passed the Assembly Floor in a vote of 46-31.
        7-9-07  Passed Senate Committee on Business, Professions, and
    Economic Development in a vote of 6-3.
        7-10-07  Passed Senate Committee on Environmental Safety and Toxic
    Materials in a vote of 5-2.
    Support
        Bluewater Network/Friends of the Earth (co-sponsor)
        MOMS--Making Our Milk Safe (co-sponsor)
        AFSCME
        Alisa Ann Ruch Burn Foundation
        As You Sow
        Breast Cancer Action
        Breast Cancer Fund
        Burn Institute
        California for a Safe Environment
        California Furniture Manufacturers Assn.
        California Labor Federation (AFL-CIO)
        California Professional Fire Fighters
        California State Firefighters' Assn.
        Center for Environmental Health
        City and County of San Francisco
        Clean Water Action
        Coalition for Clean Air
        Coalition for a Safe Environment
        Commonweal
        Consumer Attorneys of California
        Consumer Federation of California
        Diversified Health Services
        Environment California
        Environmental Working Group
        Episcopal Diocese of California
        Firefighters Burn Institute
        Firefighter Cancer Support Network
        Get Able
        Healthy Children Organizing Project
        Marin County Board of Supervisors
        MomsRising.org
        Monterey Fish Market
        Natural Resources Defense Council (NRDC)
        Ocean Conservancy
        Oceana
        Physicians for Social Responsibility
        Planning and Conservation League
        Sacramento Fire Fighters Local 522
        San Francisco Fire Marshal
        San Francisco Fire Fighters Local 798
        Sierra Club California
        Silicon Valley Toxics Coalition
        The Trauma Foundation
    Neutral
        Assn. of Woodworking & Furnishings Suppliers
        American Home Furnishings Alliance
        California Fire Chiefs Association
        Polyurethane Foam Association
    Opposition
        Alliance of Automobile Manufacturers
        American Chemistry Council
        BSEF (Bromine Industry)
        CA Black Chamber of Commerce
        CA Building Industry Association
        California Chamber of Commerce
        CA Council for Environmental & Economic Balance
        California League of Food Processors
        CA Manufacturers & Technology Assn.
        California Retailers Association
        California Space Authority
        Chemistry Industry Council of CA
        Department of Consumer Affairs
        Department of Forestry and Fire Protection
        Department of Toxic Substances Control
        Dietler Group
        Flicker of Hope Foundation
        Fresno Fire Chief
        Industrial Environmental Association
        International Sleep Products Association
        Office of Environmental Health Hazard Assessment
        Roseville Fire Department
        Silicon Valley Leadership Group
        W.F. McDonald Company
                                     ______

             The New York Times OP-Ed--Published November 19, 2006

                                 Chemical Burns

                                 By Arlene Blum

        Thirty years ago, as a researcher at the University of California,
    Berkeley, I published papers in Science magazine calling for the ban of
    brominated and chlorinated Tris, two flame retardants used in
    children's sleepwear. Both forms of Tris caused mutations in DNA, and
    leached from pajamas into children's bodies. In 1977, when brominated
    Tris was found to be a potent carcinogen, the Consumer Product Safety
    Commission banned Tris from children's sleepwear.
        So I was astonished to learn recently that the same chlorinated
    Tris that I helped eliminate from children's pajamas is being used
    today in the foam inside furniture sold in California to meet standards
    there for fire retardancy, and that the state is considering similar
    standards for pillows, comforters and mattress pads. The Federal safety
    commission, following California's lead, is working to set a national
    standard for fire-retardant furniture.
        Unfortunately, the most effective and inexpensive way for
    manufacturers to meet such standards is to treat bedding and furniture
    with brominated and chlorinated hydrocarbons like Tris. Though the
    chemical industry insists that they are safe, when tested in animals
    most chemicals in this family have been found to cause health problems
    like cancer, sterility, thyroid disorders, endocrine disruption,
    developmental impairment or birth defects, even at very low doses.
        Many of these chemicals are long-lived and accumulate, especially
    in people and other animals high on the food chain. For example, PCBs,
    chlorinated chemicals that were also used as flame retardants, were
    banned in 1977, but very high concentrations can still be found in many
    creatures, including dead killer whales washed ashore in British
    Columbia.
        According to the polyurethane-foam industry, if the new Federal
    standard for furniture were similar to the California standard, using
    current technology, then an estimated 17 million pounds of fire-
    retardant chemicals, mostly brominated and chlorinated hydrocarbons,
    would be used annually. (A more rigorous standard also being considered
    by the safety commission would require up to 70 million pounds of
    chemicals a year, the industry says. Some of that could eventually end
    up in people and the environment.)
        To complicate matters, consumers wouldn't know whether the sofa
    they're curled up on had been treated with Tris or its cousins. The
    United States does not require labeling on furniture contents.
        All this is not to say that furniture fires don't pose a danger.
    According to a recent report from the commission, 560 Americans died in
    house fires that started in upholstered furniture in 2003. But by
    contrast, cancer killed more than 500,000.
        What makes the potential increased use of chlorinated and
    brominated fire retardants all the more troubling is that it comes at a
    time when the risk of furniture fires is receding.
        Most fatal furniture fires are caused by cigarettes, which
    typically smolder for half an hour after being put down. The good news
    is that after decades of opposition from the cigarette industry,
    cigarettes that extinguish themselves within minutes are now mandatory
    in New York State and laws have been passed requiring them in five
    other states. They are likely to become universal in the United States
    in the near future, thereby greatly reducing the risk of furniture
    fires--and the need for chemical treatments.
        So why are we still using these potentially dangerous chemicals?
        In the United States, chemicals are innocent until proven guilty:
    we wait until someone has been harmed by exposure to chemicals before
    regulating them. This is not an effective strategy, since most cancers
    occur 20 to 40 years after exposure, and are usually caused by multiple
    agents. Consequently, it's very difficult to link human cancer to
    specific chemicals or consumer products.
        And there's another problem: In the United States, the
    manufacturers of consumer products are not required to disclose the
    results of toxicity tests to regulators or the public before selling
    their products.
        In marked contrast, the European Union is adopting a ``better safe
    than sorry'' philosophy through regulations known as the Registration,
    Evaluation and Authorization of Chemicals. Manufacturers must
    demonstrate that their products are safe for people and the environment
    to introduce them and keep them on the market.
        This standard provides a strong incentive for finding new
    alternatives to potentially dangerous brominated and chlorinated
    chemicals. An innovative Swedish company, for example, is developing a
    nontoxic fire retardant, Molecular Heat Eater, derived from oranges and
    lemons, that prevents fires in plastics and fabrics.
        Home fires are a defined danger in the present. Chemical fire
    retardants pose a more ambiguous risk that can last for decades. We
    need to consider the larger picture before passing regulations that
    would put chemical fire retardants inside our pillows and those of our
    children, who are even more vulnerable to carcinogens. These
    regulations would lead to the widespread use of fire retardants that
    could be ultimately much more hazardous to us and our environment than
    the fires they're intended to prevent.
        Arlene Blum, the author of ``Breaking Trail: A Climbing Life,'' is
    a biophysical chemist.
                                     ______

                   Science Magazine--12 October 2007 Vol 318

                           The Fire Retardant Dilemma

     by Arlene Blum, Center on Institutions arid Governance, University of
                              California, Berkeley

        Although smoking and fire deaths are rapidly decreasing in the
    United States \1\ proposed new flammability regulations could add tens
    of millions of additional pounds of potentially toxic fire-retardant
    chemicals to bed clothing, pillows, and foam within upholstered
    furniture \2\. In the 1970s, the flame retardants brominated tris [tris
    (2,3-dibromopropyl) phosphate] and chlorinated tris [tris (1,3-
    dichloro-2-propyl) phosphate] were removed from use in children's
    slcepwear after being found to be mutagens \3\ \4\ that could be
    absorbed into children's bodies.\5\ They are also probable human
    carcinogens.\6\ \7\ Today, chlorinated tris is the second most used
    fire retardant in furniture, found in amounts up to 5 percent of the
    foam's weight. How did this happen?

        Related structures. PBDEs, used as fire retardants in furniture,
    are structurally similar to the known human toxicants PBBs, PCBs,
    dioxins, and furans. In addition to having similar mechanisms of
    toxicity in animal studies, they also bioaccumulate and persist in both
    humans and animals.

        In the 1980s, the fire retardant pentabromodiphenyl ether
    (pentaBDE) was added to polyurethane foam to meet California's
    Technical Bulletin 117; to date, no other states have similar
    regulations. PentaBDE disassociates from foam and migrates into the
    indoor environment [especially household dust \8\]; studies show that
    pentaBDE is bioaccumulating and has the potential to adversely affect
    health \9\ and the environment. In 2003, California banned pentaBDE;
    eight other states and the European Union (EU) followed suit. In 2004,
    the U.S. manufacturer voluntarily ceased production.
        PentaBDE was replaced by chlorinated tris and unknown proprietary
    mixtures containing chemicals such as chloroalkyl phosphates,
    halogenated aryl esters, and tetrabromophthalate diol diester, which
    may be no safer. An EPA study of these chemicals shows areas of
    concern, as well as large data gaps for human health and environmental
    safety information for all of them.\10\
        While we continue to risk our health through exposure to these
    retardants, they do not appear to provide measurable fire protection.
    From 1980 to 1999, states that did not regulate furniture flammability
    experienced declines in fire death rates similar to that seen in
    California.\1\ Other causes of fire death reductions nationwide include
    a 50 percent decrease in per capita cigarette consumption since 1980;
    enforcement of improved building, fire, and electrical code; and
    increased use of smoke detectors and sprinklers. Recent legislation
    mandating fire-safe cigarettes in 22 states, including California,
    should bring further reductions in deaths due to fire, without adding
    questionable chemicals to home furnishings.
        New European regulations for the Registration, Evaluation, and
    Authorization of Chemicals (REACH) require industry to provide data to
    establish the safety of new and existing chemicals. The United States
    should follow suit. In California, Assemblyman Mark Leno introduced AB
    706, a bill that authorizes the state to consider human health and
    environmental impacts, as well as fire safety, when regulating
    flammability. This bill would prohibit the most toxic classes of
    chemicals in furniture, mattresses, and bed clothing (unless the
    manufacturer can establish their safety) and stop the cycle of
    replacing one toxic fire retardant with another.
        Fire-retardant chemicals in our homes should not pose a greater
    hazard to our health and environment than the risk of the fires they
    are supposed to prevent. Equivalent or greater fire safety can be
    achieved with new technologies and materials, furniture design, and
    green chemistry.

        Detection. Biophysical chemist Arlene Blum, using an x-ray
    fluorescence analyzer, measures 5 percent bromine from the fire
    retardant in her couch foam.
    References and Notes
        \1\ J.R. Hall Jr., ``U.S. unintentional fire death rates by state''
    (Fire Analysis and Research Division, National Fire Protection
    Association, Quincy, MA, 20061.
        \2\ There are four types of new regulations and legislation under
    consideration: (i) Federal regulation by the CPSC (``CPSC staff draft
    standard for upholstered furniture flammability, May 2005''); (ii) U.S.
    Senate CPSC Reform Act of 2007 (S. 2045) (U.S. Senate Bill 3616); (iii)
    pending California state regulation 604 to require bedding and pillows
    to be fire retardant [Tech. Bull. 604 (State of California, Department
    of Consumer Affairs, DRAFT, 2005)]; and (iv) bills in four states
    (Illinois House Bill 1610, New Jersey Assembly Bill 2299, New York
    Assembly Bill 1417, and Pennsylvania Senate Bill SB 173) to adopt
    California TB 117 for furniture flammability.
        \3\ A. Blum, B.N. Ames, Science 195, 17 (1977).
        \4\ M.D. Gold, A. Blum, B.N. Ames, Science 200, 785 (1978).
        \5\ A. Blum et al., Science 201, 1020 (1978).
        \6\ Report on Carcinogens, Eleventh Edition (U.S. Department of
    Health and Human Services, National Toxicology Program, Research
    Triangle Park, NC, 2005); http://ntp.niehs.nih.gov/ntp/roc/eleventh/
    profiles/s061tris.pdf.
        \7\ M. Babich, ``CPSC staff preliminary risk assessment of flame
    retardant (FR) chemicals in upholstered furniture foam'' (U.S. Consumer
    Product Safety Commission, Bethesda, MD, 2006), p. 5; available at
    www.cpsc.gov/library/foia/foia07/brief/ufurn2.pdf.
        \8\ M. Lorber, J. Exposure Sci. Environ. Epidemiol., published
    online 11 April 2007 (PMID: 17426733).
        \9\ T.A. McDonald, Integrated Environ. Assess. Manage. 1, 343
    (2005).
        \10\ EPA, Furniture Flame Retardancy Partnership: Environmental
    Profiles of Chemical Flame-Retardant Alternatives for Low-Density
    Polyurethane Foam (EPA 742-R-05-002A, September 2005), pp. 4-2 to 4-5.

        Mr. Mierzwinski. But we appreciate the opportunity to
    testify before you, and look forward to working with you, as we
    move into the holiday shopping season, and the toy buying
    season. Thank you.
        [The prepared statement of Mr. Mierzwinski follows:]

     Prepared Statement of Edmund Mierzwinski, Consumer Program Director,
                      U.S. Public Interest Research Group
        Chairman Pryor, Senator Sununu, Members of the Committee: I am
    Edmund Mierzwinski, Consumer Program Director of the U.S. Public
    Interest Research Group. U.S. PIRG serves as the federation of state
    PIRGs, which are non-profit, non-partisan public interest advocacy
    organizations with one million members across the country.
        We are pleased to present our views at this Legislative Hearing on
    the CPSC Reform Act of 2007, S. 2045. The state PIRGs have long been
    concerned with the important matters of consumer product safety and the
    ability of the Consumer Product Safety Commission (CPSC) to protect all
    of us, but especially the littlest among us, children, from preventable
    hazards. For example, according to data \1\ from the CPSC, at least 20
    children died in 2005 from toy-related injuries. Nine of the children
    died from choking or asphyxiating on a toy, balloon or toy part. One
    child was killed due to intestinal blockages from small, powerful
    magnets.
    ---------------------------------------------------------------------------
        \1\ In addition, approximately 202,300 people sought treatment in
    hospital emergency rooms in 2005 for toy-related injuries; at least
    152,400 (75 percent) of those injured were children under 15 years old
    and at least 72,800 (36 percent) were children younger than 5 years
    old. At least 166 children choked to death on children's products
    between 1990 and 2005, a rate of about 10 deaths a year, accounting for
    more than half of all toy-related deaths. See Toy Related Deaths and
    Injuries, CPSC Memo of 5 October 2006, available at http://
    www.cpsc.gov/library/toymemo05.pdf.
    ---------------------------------------------------------------------------
        Since 1986, we have conducted toy safety research and education
    projects to avoid such tragic and preventable deaths and injuries. Our
    annual Trouble In Toyland toy safety reports \2\ over the last 21 years
    have led to at least 120 corrective actions or recalls by the CPSC and
    manufacturers. These reports have emphasized the hazards posed by
    choking on small parts, ingestion of magnets and the chronic hazards
    posed by unnecessary exposure to lead, phthalates and other chemicals
    known to be toxic.
    ---------------------------------------------------------------------------
        \2\ These reports and other information about toy safety are
    available at our website www.toysafety.net. Our main website is
    www.uspirg.org.
    ---------------------------------------------------------------------------
        We say ``at least 120 corrective actions'' because we believe that
    our reports have led to more actions than those reported to us.\3\ Over
    the last few years, CPSC has not responded to our Freedom of
    Information Act (FOIA) requests for information about recalls and
    enforcement actions taken as a result of our Trouble in Toyland
    reports. While we believe that the CPSC has grossly over-interpreted
    the notorious Section 6(b) of the Consumer Product Safety Act in
    denying us information on these toys that have already been prominently
    reported in the news, and indeed, have had actions taken on, we are
    pleased that your legislation would drastically improve the public's
    right to know under Section 6(b).
    ---------------------------------------------------------------------------
        \3\ As of 2002, CPSC had informed us of 105 PIRG-initiated recalls
    and enforcement actions. We estimate that the last four reports
    resulted in at least 20 additional CPSC enforcement actions, including
    four recalls. In some cases, the CPSC has provided us general
    information to this effect (e.g., ``we found that 2 toys on the 2006
    PIRG list violated the small parts rule and we have recalled them''),
    but CPSC has not told us the specific names of the products recalled,
    even though the products appear on a public list in our report.
    ---------------------------------------------------------------------------
        We were also active in the legislative and regulatory process that
    led to the passage of the 1994 Child Safety Protection Act, which was
    the last major Congressional amendment to the CPSC's authority.
    Summary
        First, Mr. Chairman, we would commend you for your past efforts to
    improve the CPSC, including the recent enactment of your amendment to
    the 9/11 law that has temporarily reinstated the lapsed authority of
    the CPSC to conduct business with only two commissioners.
        We believe that your new legislation, the CPSC Reform Act of 2007,
    S. 2045, is a critical, comprehensive, and long-overdue effort to
    restore the CPSC from its status as the little agency that couldn't. We
    have detailed comments on the bill and suggestions for improving it
    even more.\4\
    ---------------------------------------------------------------------------
        \4\ The Committee also has had referred to it several other
    laudable bills to reform the CPSC that have been introduced by
    Committee Members and other Senators. Our comments on S. 2045, the most
    comprehensive bill, apply equally to any similar provisions of these
    bills. We would be happy to provide Committee or personal staff with
    detailed comments on any of the other bills.
    ---------------------------------------------------------------------------
        Recent news about the routine and repeated importation by a major
    U.S. manufacturer, Mattel, of millions of Chinese toys that grossly
    failed to meet U.S. safety standards has certainly shined important
    light on the plight of the CPSC. The CPSC is an agency that, over the
    years, has suffered both from Congressional neglect and from efforts by
    opponents of consumer protection--both within and without--to destroy
    it.
        Your bill includes provisions that will accomplish three important
    goals:

       First, it provides the CPSC dramatically increased funding,
            staffing and authority to hold corporate wrongdoers
            accountable;

       Second, it broadens and strengthens the ban on lead, a toxic
            chemical that causes brain damage and other problems and has no
            business in children's products or toys at all;

       Third, it strengthens the government's role in ensuring the
            safety of imported products while making it clear that any
            company that enters imported products into U.S. commerce is
            still responsible and cannot shift the blame to some lowest-
            cost third-party supplier thousands of miles away.
    Our Views on Specific Elements of S. 2045
    Funding and Staffing
        As is well-known, the CPSC started in 1974 with a budget of less
    than $35 million, which, if merely corrected for inflation, would today
    be over $140 million. Yet, the agency's 2007 budget is only $63 million
    and the President's modest 2008 proposals would cut the CPSC, in real
    terms. Conversely S. 2045 would increase the CPSC budget by about 10
    percent each year to approximately $140 million in 2014 while also
    directly providing additional funds to address its decrepit laboratory
    and the emerging safety issue posed by nanotechnology. We support these
    efforts, yet would suggest that while S. 2045's increases recognize
    that the agency can only absorb so much growth each year, the annual
    increases could even be tweaked up slightly to reflect real increases
    of 10 percent each year (that is 10 percent after inflation). We also
    believe that the bill's proposed staff level increases could be
    accelerated and given a higher ceiling, since the proposed increase
    from 400 to 500 employees by 2013 would still leave the CPSC at only
    about half its 1980 peak employee level. Nevertheless, we support the
    provisions.
    Quorum, Commission Size and Authority
        CPSC is responsible for the safety of 15,000 consumer products
    ranging from chain saws to kitchen appliances to children's toys. Part
    of the goal of strengthening the agency should be for the Congress to
    reinstate its 5 Commissioners, as S. 2045 would do. The bill also
    wisely extends the temporary 2-commissioner quorum so the agency can
    continue to do the people's business. It limits the power of political
    appointees and requires the CPSC, an independent agency, to notify
    Congress concurrently of proposals sent to the executive branch.
        We strongly support these provisions, especially the bill's
    provision (provided that the budget increases go through so that the
    CPSC can fund the positions) reinstating 5 commissioners as a long-term
    solution to re-establishing the agency's importance in the eyes of
    billion-dollar manufacturers that have ignored it, as well as to the
    public and its staff.
    The Public's Right To Know and the Notorious 6(b)
        In our discussions with current and former CPSC staff, and in our
    own experience as noted above, nothing has proved more unnecessarily
    harmful to the CPSC's ability to protect the public than Section 6(b)
    of the Consumer Product Safety Act, which gives corporate wrongdoers
    power over the CPSC's ability to disseminate information about
    dangerous products to the public. While a consumer can search the
    National Highway Traffic Safety Administration's databases for
    information about complaints (even those that have not led to action),
    the CPSC often cannot even disclose remedial actions it has already
    taken.
        U.S. PIRG will continue to support outright repeal of Section 6(b).
    Nevertheless, your thoughtful proposal to amend it in numerous ways to
    limit manufacturer obstinacy and threats of costly litigation has much
    merit.
        We concur with the detailed comments of the Consumer Federation of
    America that S. 2045's Section 7 amending Section 6(b) should be itself
    amended in several ways to clarify its effect. In particular, the new
    language should apply to prohibited acts under all of CPSC's statutes,
    not merely the CPSA; should not eliminate current exceptions to 6(b)'s
    limitations and should include an exception for finding that the public
    health and safety demands immediate notice for information received
    under section 15(b).
    Toxic Lead Hazards
        Exposure to lead can affect almost every organ and system in the
    human body, especially the central nervous system. Lead is especially
    toxic to the brains of young children. A child exposed to a single high
    dose of lead--such as by swallowing a piece of metal jewelry containing
    lead--can suffer permanent neurological and behavioral damage, blood
    poisoning, and life-threatening encephalopathy. Exposure to low doses
    of lead can cause IQ deficits, attention deficit hyperactivity
    disorder, and deficits in vocabulary, fine motor skills, reaction time,
    and hand-eye coordination. PIRG studies have found lead levels in
    children's jewelry at 28 percent by weight or more.
        Children are more vulnerable to lead exposure than adults, since
    young children often put their hands and other objects in their mouths;
    their growing bodies absorb more lead; and children's developing brains
    and nervous systems are more sensitive to the damaging effects of lead.
    Currently, while lead is explicitly banned in paint (at levels based on
    1970s science), the CPSC must jump through numerous hoops before it can
    recall other products containing lead (except those with banned lead
    paint). Among other regulatory hurdles, it must first determine that
    levels of lead in any product are ``accessible'' to ban the product.
    While, positively, the CPSC is proceeding (through a rulemaking in
    response to a Sierra Club petition) to ban lead in metal components of
    children's jewelry, the better, precautionary approach is to simply ban
    lead in all children's toys and products (including, for example,
    plastic jewelry).
        S. 2045 takes that precautionary approach. It lowers allowable lead
    paint levels and bans lead, except in trace amounts, in other
    children's products. Nevertheless, we would urge the Committee to
    review the recent House testimony \5\ of the American Academy of
    Pediatrics, which offers a comprehensive review of current and
    historical lead standards and defines trace levels even lower than the
    laudable proposals in S. 2045. We concur with these findings from AAP:
    ---------------------------------------------------------------------------
        \5\ See testimony of Dana Best, M.D., M.P.H., American Academy of
    Pediatrics at a Hearing on Protecting Children from Lead-Tainted
    Imports of the Subcommittee on Commerce, Trade, and Consumer Protection
    of the House Energy and Commerce Committee, 20 September 2007,
    available at http://energycommerce.house.gov/cmte_mtgs/110-ctcp-
    hrg.092007.Best-testimony
    .pdf.

       The CPSC should require all products intended for use by or
            in connection with children to contain no more than trace
    ---------------------------------------------------------------------------
            amounts of lead.

       The Academy recommends defining a ``trace'' amount of lead
            as no more than 40 ppm, which is the upper range of lead in
            uncontaminated soil. This standard would recognize that
            contamination with minute amounts of lead in the environment
            may occur but can be minimized through good manufacturing
            practices.

       ``Children's product'' should be defined in such a way as to
            ensure it will cover the wide range of products used by or for
            children. This standard should cover toys intended for use by
            or with children under the age of 12 years.

       The limit on lead content must apply to all components of
            the item or jewelry or other small parts that could be
            swallowed, not just the surface covering.

       Legislation or regulations should limit the overall lead
            content of an item, rather than only limiting lead content of
            its components. A single product may contain numerous
            components that could cumulatively contain a dangerous level of
            lead.
    Corporate Accountability
        The bill, S. 2045, takes numerous steps to hold corporations
    accountable for the safety of products that they enter into commerce.
    Quite simply, today, manufacturers are more afraid of Wal-Mart's (and
    other retailers) demands for the lowest priced product than they are of
    threats from the CPSC for breaking the law.
        Most importantly, the bill (Section 17) increases CPSC civil
    penalty authority from the current ``business as usual'' cap of $1.8
    million dollars to a more imposing $100 million. The section also
    broadens criminal enforcement provisions. Section 15 establishes
    greater penalties for ``repeat importation'' offenses. Section 16 would
    broaden the scope of prohibited acts under the agency's authority. It
    would also give the CPSC authority that it does not now have to prevent
    the dumping of products that pose hazards onto other countries.
        Section 22 would establish new law creating protection for
    corporate whistleblowers. While we have not had a chance to evaluate
    this section in detail and encourage the Committee to contact the
    Government Accountability Project for a review, this is an important
    step. No one, whether he or she is an employee of any firm, or of the
    government, or even a consumer, should suffer the threat of retribution
    for good faith disclosure of information about product hazards.
    Improving Corrective Action Plans Under CPSC Recall Authority
        The bill (Section 13) also limits the ability of manufacturers to
    game the process of recalling hazardous products by taking less action
    than would be effective at protecting the public. The bill would
    require CPSC approval of corrective action plans, which now are often
    poor excuses for protecting the public.
        Because the process of a mandatory recall is so difficult, and is
    subject to numerous delays and possible litigation by affected
    companies, the CPSC nearly always instead negotiates voluntary recalls.
    But with the CPSC under pressure to take action as quickly as possible,
    the company involved doesn't have to agree to aggressively, if at all,
    remove the recalled product from commerce. It can simply agree, for
    example, to a ``repair'' or a ``stop sale'' of a recalled item, and
    leave old hazardous product on the shelves, provided any new product
    meets standards. As we noted in our 2006 Trouble In Toyland report, the
    first major CPSC action \6\ concerning the hazards posed by powerful,
    tiny rare-earth magnets was not a recall, but merely a ``replacement''
    program:
    ---------------------------------------------------------------------------
        \6\ Child's Death Prompts Replacement Program of Magnetic Building
    Sets, CPSC release of 31 March 2006 available at http://www.cpsc.gov/
    cpscpub/prerel/prhtml06/06127.html.

            In November 2005, a 21-month old boy named Kenneth Sweet, Jr.
            died of blood poisoning and tissue necrosis; an autopsy showed
            that two separate sets of magnets had pinched parts of his
    ---------------------------------------------------------------------------
            small intestine.

            CPSC and [the manufacturer] Rose Art did not recall Magnetix
            toys on store shelves. Instead, Rose Art told consumers who are
            ``uncomfortable having the product in your home'' to return the
            sets to the company for a free replacement product suitable for
            children under the age of six. As of September 30, 2006, MEGA
            Brands [acquirer of Rose Art] had received approximately 13,000
            requests for replacements. This means that most of the four
            million Magnetix toys sold before March 31 have not been
            returned and could remain in homes across the United States.

        ``Uncomfortable having the product in your home'' is not an
    adequate product safety standard.
    Strengthen Import Protections
        For better or worse, we live in a global economy. Manufacturers
    seeking lowest-cost producers routinely stretch supply chains to China
    or other countries. While the manufacturer, importer, retailer or
    distributor is appropriately responsible under the CPSA and other laws
    enforced by the CPSC for ensuring that any product that it enters into
    commerce meets U.S. standards (and should not blame some sub-contractor
    when it does not), Congress should also take steps to better protect
    consumers from the hazards posed by imported products.
        The bill, S. 2045 takes several steps, which we support, to improve
    import safety.
        Section 10 (which applies to all children's products, not only
    imports), establishes new third party certification for all children's
    products. The section prohibits their importation without such
    certification. Importantly, the third party certification is
    administered under the authority of the CPSC. It would not be as useful
    were it not. Also, importantly, we would read Section 18 (preemption)
    as making it clear that mere certification of a product would not grant
    any immunity or shield from liability under state law. The committee
    should be wary of any attempts by industry associations to change this.
        Section 14 provides for improved identification of importers (and
    others). Section 20 would require the bonding of any importer, to
    ensure that it can pay for any necessary recalls, cost of holding at
    the port or product destruction. Section 19 improves the CPSC's ability
    to share information with both state enforcers and agencies of foreign
    governments. We are well aware of the European Commission's concerns
    over the current limitations on sharing hazard information with them;
    we believe that Section 19 will ameliorate their concerns.
        We would also urge the Committee to review recent House testimony
    \7\ by Public Citizen's Global Trade Watch, which points out that
    current and proposed trade pacts may limit the effect of your actions
    to strengthen import safety, or may subject them to trade sanction
    challenges.
    ---------------------------------------------------------------------------
        \7\ See testimony of Lori Wallach, Director, Public Citizen's
    Global Trade Watch, at a Hearing on Protecting Children from Lead-
    Tainted Imports, Subcommittee on Commerce, Trade and Consumer
    Protection of the House Energy and Commerce Committee, September 20,
    2007, available at http://energycommerce.house.gov/cmte_mtgs/110-ctcp-
    hrg.092007.Wallach-testimony.pdf.
    ---------------------------------------------------------------------------
    Relationship to State Laws
        U.S. PIRG is a strong supporter \8\ of the principle that Federal
    law should serve as a floor of health and safety protection but that
    states should be allowed to protect their consumers, workers and
    environment better. As a former state attorney general, Mr. Chairman, I
    know you agree that states often act more quickly than Federal agencies
    or Congress and provide an important complement to Federal efforts.
    Yet, far too often, the Congress ignores this and trades passage of a
    weak Federal law for ``Federal uniformity'' in response to the baseless
    demands of self-interested industry organizations.
    ---------------------------------------------------------------------------
        \8\ See our website resources on why state preemption of stronger
    consumer and environmental laws is a bad idea at http://uspirg.org/us-
    law-policy.
    ---------------------------------------------------------------------------
        We commend the Committee for the strong anti-preemption language
    included in Section 18,\9\ including its admonishment of former CPSC
    Chairman Hal Stratton's attempt to invent authority to preempt state
    causes of action for compensation by consumers burned in mattress
    fires.\10\
    ---------------------------------------------------------------------------
        \9\ We also recognize the important provision, Section 21,
    establishing the right of state attorneys general to bring actions
    under the CPSA. If it hasn't already, we suggest the Committee seek
    comment from the National Association of Attorneys General.
        \10\ We urge the Committee to review the testimony of Professor
    David Vladeck at a hearing of the Senate Judiciary Committee,
    ``Regulatory Preemption: Are Federal Agencies Usurping Congressional
    and State Authority?'' held on 12 September 2007, for a discussion of
    this CPSC episode and similar efforts by other Bush agencies to preempt
    state consumer law even when they haven't been granted Congressional
    power to do so. Hearing available at http://judiciary.senate.gov/
    hearing.cfm?id=2935.
    ---------------------------------------------------------------------------
        Nevertheless, in the area of state preemption, just as in the area
    of children's exposure to toxic products, we believe in the
    precautionary principle. So, we have the following recommendations to
    amend and strengthen the section.
        Ideally, we believe that the language in Section 12 of the Safety
    Assurance for Every Consumer Product Act, H.R. 3691, more clearly
    achieves the goals of Section 18 of S. 2045. In particular, that
    section states:

            ``No consumer product safety standard promulgated by the
            Commission after the date of enactment of the Safety Assurance
            for Every Consumer Product Act, or any other action taken by
            the Commission after that date, shall contain a preemption
            provision which affects any action for damages or the liability
            of any person for damages under the statutory law or the common
            law of any State, unless such provision is expressly authorized
            by statute.''

        Alternatively, we would suggest a modification to Section 18(a),
    which includes a complex relationship between sections (a) and (c), as
    modified by the words ``to an extent greater than,'' which we would
    suggest could be changed to the following:

            ``No consumer product safety standard promulgated by the
            Commission after the date of enactment of the CPSC Reform Act
            of 2007, or any other action taken by the Commission after that
            date, shall preempt any State or local law that would be in
            addition to the preemption of State regulations permitted under
            subsection (a), as limited by subsection (c).''

        Again, we want to commend the Committee for recognizing the
    importance of allowing state enforcement, legislation and common law
    that provide greater protection than Federal law.
    Conclusion
        We commend you, Mr. Chairman, and your cosponsors for introducing
    this important legislation. The CPSC Reform Act of 2007, S. 2045, is a
    critical, comprehensive, and long-overdue effort to restore the CPSC
    from its status as the little agency that couldn't. We hope that you
    find our comments helpful. We look forward to working with you and your
    Committee staff to enact it into law. We would also be happy to discuss
    other possible actions under the Committee's jurisdiction to protect
    consumers from hazards. Under the CPSC's jurisdiction alone, for
    example, we urge you to hold hearings on ATV safety, extending the
    Child Safety Protection Act to the Internet, improving recall
    effectiveness and investigating the chronic and developmental hazards
    from unnecessary exposure to toxic phthalates (plastic softeners) in
    children's products. Thank you.

        Senator Pryor. Thank you.
        Mr. Plunkett?

     STATEMENT OF TRAVIS PLUNKETT, LEGISLATIVE DIRECTOR, CONSUMER
                         FEDERATION OF AMERICA

        Mr. Plunkett. Good afternoon, Chairman Pryor, Senator
    Klobuchar and Senator McCaskill.
        I'm Travis Plunkett, I'm the Legislative Director at the
    Consumer Federation of America and I'm going to echo many of
    Ed's comments here in commending all of you for this excellent
    piece of legislation. It's a far-reaching and comprehensive
    bill, it'll strengthen the CPSC, and give it the tools that it
    desperately needs to protect consumers.
        As you've heard repeatedly, the Agency needs to increase
    its financial and staff resources. We strongly support your
    proposals toward that end in the bill.
        I would suggest that you consider increasing staffing
    beyond the increase of 100 full-time employees by 2014. You've
    pointed out already, Mr. Chairman, that the Agency is at about
    half the number of employees at its peak.
        It is true, the technology has improved the ability of
    employees to be more effective, but as you've also pointed out,
    it is true that the number of imports that need to be examined
    in this country have sharply increased, so we'd urge you to
    consider a staffing increase, although on funding and staffing,
    you take the Agency far above where it is right now. And it's a
    very important increase.
        On third-party certification, we see that as a crucial part
    of the bill. The key to making sure products are safe when they
    enter the stream of commerce is to check for safety at the
    beginning of the supply chain. We strongly support this
    provision, and we'd encourage you to apply, it's a voluntary
    standard adopted by the industry, as well. And we also strongly
    support the bill's creation of a role for the CPSC in ensuring
    the testing laboratories meet minimum criteria and test to the
    highest standards.
        A number of the provisions in the bill that increase the
    accountability of manufacturers, retailers and importers that
    put unsafe products on the market have already been mentioned.
    I will just tell you that the Consumer Federation strongly
    supports a number of those provisions. We'd like to see the cap
    on civil penalties entirely lifted, but the bill's increases on
    individual fines and cumulative fines are very significant. The
    limits will encourage manufacturers to recall dangerous
    products faster, and to comply more carefully with safety laws.
        We also support the bills goal of authorizing civil
    enforcement by State Attorneys General and not encroaching on
    stronger State laws. And finally, we support the bill's
    proposals to strengthen penalties and procedures for criminal
    violations of the law--this has not yet been mentioned--in
    particular, removing the so-called receipt of noncompliance
    requirement in current law will ensure that those who violate
    the law in a criminal manner, do not get a free pass for a
    first violation.
        For many years, CFA and other consumer groups have urged
    Congress to remove Section 6(b), excuse me, there has been much
    discussion of that today. We think it's very important that it,
    at the very least, be amended in the way that you have
    suggested. This will put fewer roadblocks in front of the CPSC
    to releasing important crucial safety information in a timely
    manner. And, we urge you to proceed with this provision.
        We've heard a lot of discussion of lead, I would echo Ed's
    comments that the AAP and others think that allowable levels
    should be reduced even further. This is groundbreaking, though,
    in applying the standard to children's jewelry and other
    children's toys, and we commend you for that.
        Finally, let me suggest one significant new piece to
    improve recall effectiveness, we would recommend that you
    require manufacturers to provide a means of, directly and
    quickly, communicating information about recalls to consumers
    through a registration card. As you move forward with this
    bill, we encourage you to think about that as an important new
    provision that could be included in the bill.
        Thank you for the opportunity to comment on this bill. We
    view it as one of the most important pieces of consumer
    legislation to be offered in Congress in several years, and we
    look forward to working with you on it.
        [The prepared statement of Mr. Plunkett follows:]

         Prepared Statement of Travis Plunkett, Legislative Director,
                         Consumer Federation of America
        Chairman Pryor, Ranking Member Sununu and Members of the
    Subcommittee, I am Travis Plunkett, Legislative Director for Consumer
    Federation of America (CFA). CFA is a nonprofit association of
    approximately 300 pro-consumer groups, with a combined membership of 50
    million people that was founded in 1968 to advance the consumer
    interest through advocacy and education. Thank you for holding this
    hearing and for providing us with the opportunity to speak today.
        First, we must applaud your leadership on product safety issues.
    Your inclusion of language extending the quorum in the Implementing
    Recommendations of the 9/11 Commission Act of 2007 was critical to
    passage of that language which has allowed the agency to operate fully
    for an additional 6 months. We also applaud your introduction of S.
    2045. This far reaching and comprehensive bill will strengthen the U.S.
    Consumer Product Safety Commission and give it the tools it desperately
    needs to protect consumers from unsafe products.
        The Consumer Product Safety Commission (CPSC) is the independent
    Federal agency charged with protecting the public from hazards
    associated with at least 15,000 different consumer products. The Agency
    was created because the marketplace was not adequately policing itself:
    litigation and various Federal laws were not sufficiently preventing
    death and injuries from unsafe products. CPSC's mission, as set forth
    in the Consumer Product Safety Act, CPSC's authorizing statute, is to
    ``protect the public against unreasonable risks of injury associated
    with consumer products.'' \1\ CPSC's statutes give the Commission the
    authority to set safety standards, require labeling, order recalls, ban
    products, collect death and injury data, inform the public about
    consumer product safety, and contribute to the voluntary standards
    setting process. CPSC was created to be an agency that acts proactively
    to protect consumers. Unfortunately, the CPSC's ability to be proactive
    has been thwarted by a shrinking budget, a lack of aggressive action by
    the agency, and statutory provisions that create obstacles to the
    effective prevention of product risks. S. 2045 takes many steps to
    removing several of these obstacles.
    ---------------------------------------------------------------------------
        \1\ Consumer Product Safety Act, 15 U.S.C. 2051, section 2(b)(1).
    ---------------------------------------------------------------------------
        As a framework for discussing some of the most significant
    provisions of S. 2045, I will focus on CFA's core principles for
    product safety reform.
    1. Strengthen CPSC
    A. Increase Budget
        With jurisdiction over many different products, this small agency
    has a monstrous task. In 1974, when CPSC was created, the agency was
    appropriated $34.7 million and 786 full-time employees (FTEs.) Now, 33
    years later, the agency's budget has not kept up with inflation, its
    deteriorating infrastructure, its increasing data collection needs, or
    the fast-paced changes occurring in consumer product development. The
    CPSC budget has also not kept pace with the vast increase in the number
    of consumer products on the market. CPSC's staff has suffered severe
    and repeated cuts during the last two decades, falling from a high of
    978 employees in 1980 to just 401 for the 2008 Fiscal Year. This is the
    fewest number of FTEs in the agency's 30-year history and represents a
    loss of almost 60 percent.
        The President's 2008 budget would provide only $63,250,000 to
    operate the agency. This represents a reduction of 19 FTEs and a small
    increase of $880,000 from the 2007 appropriation. This increase does
    not provide for inflation, fails to allow CPSC to even maintain its
    current minimal programming, and will not allow for CPSC to invest in
    its research, resources and infrastructure.
        Because of this historically bleak resource picture, CFA is
    extremely concerned about the agency's ability to effectively prevent
    and reduce consumer deaths and injuries from unsafe products. It is for
    this reason that CFA strongly supports Section 3 of S. 2045. This
    section, entitled, ``Reauthorization'' sets up an appropriations
    schedule for CPSC through 2015. It increases budget levels by
    approximately 10 percent each year, ending in 2014 at just over $140
    million. Consumer Federation of America supports these gradual
    increases, as we believe that these increases are the most effective
    way to strengthen the agency. We have suggested increases of between 10
    and 15 percent each year with an end goal of approximately $140
    million. Adjusting CPSC's first budget of $34 million to today's
    dollars would result in a budget of $140 million. CFA also supports S.
    2045's provision that appropriates $20 million in 2009 and 2010 for
    CPSC's laboratory, as well the $1 million during these 2 years for
    research with other agencies related to nanotechnology.
    B. Increase Full-Time Employees
        Section 4 of S. 2045 directs CPSC to increase FTEs to at least 500
    by October 1, 2013. While we support this increase of 100 FTEs, we hope
    that the Subcommittee will consider increasing staffing levels even
    faster, given the extraordinary product safety challenges the Nation is
    facing. We further support the bill's prohibition of burrowing by
    political appointees into career positions.
    C. Restore Commission to Five Commissioners
        Section 5, ``Full Commission Requirement; interim quorum,''
    restores the Commission to five members, as was originally required in
    the Consumer Product Safety Act. We support this provision as we
    believe that additional members would result in a more robust and
    dynamic Commission that would strengthen and enhance the work of the
    Commission, thus better serving the public interest. However, we urge
    that the full Commission only be restored if the Commission's budget
    and staff are increased as proposed in this bill. We want to ensure
    that resources will not be taken away from the much needed product
    safety work conducted by the agency. This provision also includes a
    temporary quorum provision that would extend the current emergency
    quorum of two members for nine additional months after this bill is
    passed. This Subcommittee may wish to extend this emergency quorum to
    expire once there is a full complement of Commissioners.
    D. Streamline Rulemaking Procedures
        The Consumer Product Safety Act, as amended in 1981, requires CPSC
    to engage in a three-step rulemaking process that is unnecessarily
    time-consuming. Section 8, ``Rulemaking,'' makes the Advanced Notice of
    Proposed Rulemaking (ANPR) process under CPSA voluntary rather than
    mandatory. We support this provision as it allows the ANPR process when
    justified but would also permit expedited rulemaking when necessary.
    The Subcommittee should consider requiring rulemaking ``benchmarks''
    that require the CPSC to complete the rulemaking process within
    particular time-frames, or to submit an explanation to Congress as to
    why these benchmarks cannot be met. Such requirements could expedite
    the CPSC's glacial rulemaking process, while allowing the agency to
    exceed recommended benchmarks when justified, as well as provide notice
    to the public about the time limits for each stage of rulemaking.
    2. Require Independent Third-Party Testing
        To make sure that products are safe when they enter the American
    and global stream-of-commerce, safety must be infused into the earliest
    stages of the supply chain. For this reason, independent third-party
    testing of components, as well as final products, must be required.
    Third-party testing entities must be independent from and have no
    financial relationship with the manufacturer producing the product.
    Testing must be conducted to identify design flaws as well as
    violations of existing regulations, such as those governing the use of
    lead paint. Components and final products must be tested at numerous
    stages of production and tests must be conducted randomly throughout
    the manufacturing process. Products should also be certified that they
    meet the appropriate standards and should bear a label indicating that
    they are certified.
        Section 10 of S. 2045, ``Third party certification of children's
    products,'' amends section 14(a) of CPSA and applies to any
    manufacturer or private labeler of a children's product that is subject
    to: (1) product safety standard under CPSA; or (2) or a rule under any
    act declaring a product a banned hazardous product. This would require
    testing by non-governmental independent third parties qualified to
    perform tests and would require that certificates be issued certifying
    conformity to the applicable safety standard or certifying that the
    product is not a banned hazardous product. While CFA supports this
    provision, we believe it is a reasonable compromise to require that
    products also be certified for compliance with all voluntary standards
    as well. Further, children's products are defined narrowly, as those
    designed or intended for use by children under 7 years old. However,
    recognized authorities such as the American Academy of Pediatrics have
    recommended that children's products be defined as those intended for
    children under twelve years old.
        We support the provision in S. 2045 that creates a role for CPSC to
    play in ensuring that testing laboratories meet a minimum criteria and
    test to the highest standards. The CPSC is limited by its current
    budget, staff, expertise, and distance from off-shore manufacturing to
    engage in product-testing at the earliest stages of the supply chain.
    However, we believe that a publicly accountable entity should regulate
    these third-party overseers to set consistent and high standards.
    Ultimately the responsibility falls on the manufacturers and/or
    importers, many of which are based in the United States, to be more
    fully engaged in testing and policing the component parts that make up
    their products, as well as their final products.
    3. Hold Manufacturers, Retailers, and Importers Accountable and
            Responsible
        Global and American manufacturers, retailers and importers need to
    take responsibility and be held accountable for safety at every stage
    of the supply chain. As our economy is becoming increasingly global and
    the supply chain is becoming more complex with transactions becoming
    more arms-length, our priority must be that safety never falls through
    the cracks. Safety should never be ``lost in translation'' or
    compromised for a better price.
        However, global manufacturers have not been able to comply with
    existing laws and regulations, such as those banning lead in paint up
    to .06 percent of weight. While CFA agrees that additional legislation
    is necessary, such as Senator Pryor's bill requiring independent third-
    party testing and expanding the ban on lead in all children's products,
    enforcement mechanisms must be in place to ensure compliance with these
    laws. Currently, limited enforcement mechanisms are in place. Very low
    caps exist on the amount of civil penalties the CPSC can assess against
    an entity in knowing violation of its statutes. The current civil
    penalty is capped at $7,000 for each violation, up to a total of $1.83
    million. A ``knowing violation'' occurs when the importer,
    manufacturer, distributor or retailer has actual knowledge or is
    presumed to have the knowledge a reasonable person would have or should
    have if the person acted reasonably to determine the truth. Knowing
    violations often involve a company's awareness of serious injury or
    death associated with its product.
        CFA supports completely eliminating this cap on the amount of civil
    penalties that CPSC can assess. However, we support the reasonable
    compromise set forth in Section 17 of S. 2045, which increases the cap
    to $250,000 for each such violation up to a total of $100 million.
    These new guidelines will encourage manufacturers to recall products
    faster and to comply with CPSC's statutes in a more aggressive way.
    Importantly, these new civil penalty limits will act as a meaningful
    deterrent to non-compliance with CPSC's regulations.
        Section 17 also deletes one of the more counterintuitive provisions
    of the CPSA, which requires ``receipt of notice of noncompliance'' from
    the Commission before any person could be fined under the criminal
    penalty provision. Those who violate the law in a criminal manner
    should not get a free pass for a first violation. We support the
    removal of this clause and also support the inclusion of jail time for
    anyone who knowingly commits a prohibited act as defined by CPSC's
    statutes, as well as the removal of the ``willfully'' standard for
    those who authorize any prohibited act, and the inclusion of asset
    forfeiture as a criminal penalty. Criminal violators of CPSC's
    regulations must be punished in a meaningful way for criminal behavior
    as such behavior compromises the health and safety of our Nation.
        Finally, CFA supports the inclusion of Section 15, ``Repeated
    importation offenses,'' which allows the Commission to identify a
    repeat offender (after notice and hearing) and to recommend to Customs
    and Border Protection (CPB) that their import license be terminated.
    This is a positive step forward; however, this provision could be
    strengthened by requiring CBP to follow any CPSC recommendations.
    Further, ``multiple violations'' should be defined.
    4. Disclosure of Product Safety Information to the Public
        For many years, CFA and other consumer groups have urged Congress
    to eliminate section 6(b) of the CPSA. This section of the Act
    restricts CPSC's ability to communicate safety information to the
    public. Currently, CPSC is required to give a company an opportunity to
    comment on a proposed disclosure of information. If the company has
    concerns about the wording or the substance of the disclosure they can
    object. CPSC must accommodate the company's concerns or inform them
    that they plan to disclose the information over their objections. The
    company can then sue the Commission seeking to enjoin them from
    disclosing the information. Thus, this provision creates a time-
    consuming process between CPSC and the affected company, often serving
    to delay or deny any potential disclosure.
        Section 7 of S. 2045 regarding ``Public disclosure of information''
    does not delete section 6(b), but rather amends it in numerous ways.
    This amendment requires that any industry response to the CPSC in these
    circumstances be provided within 15 days and eliminates the ability of
    a company to institute a court proceeding to enjoin release of the
    information CPSC may also attach the manufacturer or other entity's
    comments as an addendum to the release of public safety information.
    This section of S. 2045 takes an important step forward by instituting
    a reasonable time-frame for companies to respond to CPSC requests for
    disclosing information and minimizes the possibility of lengthy and
    resource-intensive litigation.
        However, we would recommend several changes to this provision to
    make it more effective. First, the new language should apply to
    prohibited acts under all of CPSC's statutes, not merely the CPSA, so
    that products and relevant information regulated under different
    statutes are treated equally. Second, the new language appears to
    eliminate an existing exception to 6(b) that allows for the disclosure
    of information relevant to ongoing rulemaking proceedings.
        CFA also supports the provision set forth in section 6 of S. 2045,
    ``Submission of copy of certain documents to Congress.'' CFA, other
    consumer groups, and Members of Congress have been hindered from having
    access to CPSC's budget requests to the Office of Management and Budget
    (OMB). Thus, reinstating Section 27(k) of the CPSA which requires the
    Commission to simultaneously submit budget requests and legislative
    recommendations to both OMB and to Congress will illuminate what budget
    the Commission actually requests.
    5. Ban Lead from Children's Products
        As you are well aware, lead has increasingly been found in
    children's products, including toys, jewelry, lunch boxes, bibs, cribs
    and other items. Lead has been found in products made by large
    manufacturers as well as in those made by smaller companies. CFA
    supports a ban on lead in all children's products, which currently does
    not exist. While lead in the paint used in children's products is
    limited to .06 percent by weight of lead (a standard set in the 1970s),
    there is no mandatory law prohibiting the use of lead in children's
    jewelry or in other children's products. CFA supports a full ban on the
    use of lead in children's products other than trace amounts. This is
    because experts confirm that there is no safe level of lead exposure.
    Serious, acute and irreversible harm can come to children as a result
    of exposure to lead. Finally, there is no justifiable reason why such a
    dangerous additive should be used in children's products, as safer
    alternatives almost always exist.
        Section 23 of S. 2045 requires that any product not in compliance
    with this rule is considered a banned hazardous substance, whether or
    not the lead is accessible to a child. Section 23 defines the ban on
    lead in three ways: (1) for toy jewelry, any lead content greater than
    .02 percent by weight violates the standard; (2) for other children's
    products, anything greater than .04 percent by weight is in violation;
    and (3) the current ban on lead in paint is changed from .06 percent to
    .009 percent. For consumer electronics, the bill directs the Commission
    to promulgate a rule to reduce exposure to and the accessibility of
    lead in electronic devices. The day after this Act takes effect, CPSC
    is required to begin rulemaking for all products that are covered, to
    determine whether there should be lower limits for lead than required
    in the Act.
        CFA views this provision as a positive improvement over the status
    quo. However, we note again that experts maintain that there is no safe
    level of lead. The American Academy of Pediatrics supports a limit of
    .004 percent by weight of lead for all children's products. We hope to
    work with the Subcommittee to reduce the acceptable levels of lead even
    further.
    6. Recall Effectiveness
    A. Direct-to-Consumer Notification of Recalls
        The ability of CPSC to conduct effective recalls of unsafe products
    is critical to protecting the public from unreasonable risks associated
    with consumer products. CFA supports requiring that manufacturers (or
    distributors, retailers, or importers) of products intended for use by
    children provide with every product a Consumer Safety Registration Card
    that allows the purchaser to register information through the mail or
    electronically. Such information should be used by a recalling company
    solely to contact the purchaser in the event of a recall or potential
    product safety hazard. Product Registration Cards are required to be
    attached to car seats to provide a mechanism to directly notify
    consumers who purchased a recalled car seat. These methods would be
    more effective than the current approach, which relies on the media to
    convey the news of the recall.
        Consumers who do not hear of product recalls are at greater risk of
    tragic consequences, including death or injury. By being dependent upon
    the media and generic forms of notice to broadly communicate
    notification of recalls to the public, CPSC and the companies involved
    are missing an opportunity to communicate directly with the most
    critical population--those who actually purchased the potentially
    dangerous product. Consumer Safety Registration Cards or a similar
    electronic system would provide consumers the opportunity to provide
    manufacturers their contact information enabling manufacturers to
    directly notify consumers about a product recall.
        To improve recall effectiveness, CFA recommends that S. 2045
    include a provision that amends section 15 of the CPSA to require
    manufacturers to provide a means of directly communicating information
    about recalls to consumers through a registration card, electronically
    or by other means of technology. Manufacturers, retailers, and
    importers should be required to report the existence of the recall to
    retailers and all commercial customers within 24 hours after issuing
    the recall or warning. All entities within the stream of commerce
    should be required to post the recall to websites, if in existence,
    within 24 hours of the issuance of a recall. We suggest that
    manufacturers, retailers, distributors, and importers be required to
    communicate notice of the recall to all known consumers. Retailers,
    after receiving notice of the recall, should be required to remove the
    recalled product from their shelves and website within three business
    days or by the time of a CPSC recall announcement, whichever is
    shorter, and to conspicuously post notice of the recall in their stores
    for at least 120 days after issuance of the recall.
        CFA also supports the concept of section 16 of S. 2045, which
    allows the Commission to prohibit the export of products if they do not
    comply with any safety standard, are banned as hazardous, or are the
    subject of a voluntary recall or other corrective action. CFA supports
    not merely ``allowing'' the Commission to prohibit export in these
    circumstances but rather, urges the Subcommittee to ``require'' the
    Commission to prohibit the export of such products The export of
    recalled and hazardous products to other countries should simply be
    prohibited.
        Section 13 of S. 2045, ``Corrective Action Plans,'' requires
    Commission approval of corrective action plans and defines a standard
    for what type of plan is in the public interest. We support this
    provision as it will strengthen CPSC's ability to obtain a recall
    remedy that is effective and safe.
    B. Bonding
        This summer's recall of tires from an overseas importer highlighted
    a serious problem: some importers may not be able to afford the costs
    of conducting a recall if safety hazards exist. If a company is
    benefiting from the sale of their products in the United States, they
    must be able to prove that they can cover the costs of a recall. All
    product sellers, including importers, must be required to post a bond
    or something equivalent to ensure that recalls could be effectively
    conducted. CFA supports section 20 of S. 2045, which directs the
    Commission to promulgate a rule to require manufacturers and others
    involved in the distribution of a consumer product to post a bond (or
    something similar that is acceptable to the Commission) to cover the
    costs of a potential ``effective recall,'' holding the product at port,
    and/or the destruction of the product.
    7. Traceability
        When the product safety net fails and an unsafe product enters the
    market, it can be difficult to isolate the source of the problem. For
    example, a problem may have occurred at the manufacturing phase by a
    subcontractor of a subcontractor. Tracking this down can be incredibly
    time-consuming and can delay a meaningful corrective action plan.
    Further, more than one manufacturer may have used the same
    subcontractor so knowing the source of the safety failure is critical
    to isolating the problem. Thus, products should contain some type of
    label, mark or number on a product that would directly indicate the
    source, date and production group.
        Section 14 of S. 2045, ``Identification of manufacturer imports,
    retailers, and distributors,'' requires manufacturers to submit to CPSC
    any identifying information, such as the retailer or distributor and
    all subcontractors. This will help CPSC to more readily identify all of
    the segments of the supply chain. In addition, section 11, ``Tracking
    labels for durable products for children,'' requires indications on
    product or packaging that enables a consumer to ascertain the source,
    date, and cohort. This will be useful for consumers as they attempt to
    identify whether the product they own may be subject to a recall. CFA
    suggests improving this provision by requiring this information on both
    the product and the packaging, as packaging materials are often
    discarded.
    8. Preemption
        In February of 2006, the Draft Final Rule for Flammability of
    Mattress Sets (``Draft Final Rule'') was made available to the public.
    Consumer groups opposed this Draft Final Rule not because of its
    substantive requirements but because of the novel language added to the
    preamble after the notice and comment periods expired that purported to
    preempt state common law remedies. CFA, therefore supports the concept
    that Congress should clarify the reach of CPSC's authority to prevent
    the Commission from usurping well established state regulatory
    authority and common law claims.
        In conclusion, we support the introduction of this legislation as
    it represents a number of crucial steps forward in improving and
    strengthening CPSC's ability to protect the public from harmful
    products. We look forward to working with the Subcommittee to make this
    bill law.

        Senator Klobuchar [presiding]. Thank you, Mr. Plunkett.
        Mr. Korn?

      STATEMENT OF ALAN KORN, J.D., DIRECTOR OF PUBLIC POLICY AND
                     GENERAL COUNSEL, SAFE KIDS USA

        Mr. Korn. Thank you, Madam Chair.
        Senator Klobuchar. For the minute.
        Mr. Korn. First off, thank you for having this hearing. We
    have quite a bit of confidence in this Committee, and in
    particular the staff sitting behind you on both sides of the
    aisle. There are often weeks where I speak to the ladies and
    gentlemen behind you more than I speak to my own wife, which
    tells me that this Committee is completely focused on consumer
    product safety and we join you in that effort. And you've been
    a particular leader in your short time here. We appreciate your
    support on the Pool Bill and, in fact, you've improved that
    bill for us.
        Senator Klobuchar. Well thank you, and you can tell your
    wife you talk to her more than me.
        [Laughter.]
        Mr. Korn. Madam Chair, there are many who feel that the
    CPSC is a dead agency and that it's failing repeatedly to serve
    its important mission. I am not one of those people. The CPSC
    is full of committed staff, who every day work hard to protect
    and serve its mission.
        The CPSC however, is an agency that is withering on the
    vine; and it is in need of immediate water and fertilizer. And
    this bill, we believe, is a much needed dose of Miracle Grow.
        I won't read through my testimony. I'll go through a few
    highlight points that have not been raised yet, except as to
    say this. We believe that the most important provision of this
    particular bill is its budget increase. Single-handedly, that
    is the most important thing we can do to improve this Agency,
    notwithstanding the CPSC Chairman's reluctance. Those of us,
    who deal with that Agency, know it needs an infusion of funds
    and can use an infusion of funds. We're glad to see that
    Senator Durbin's on this bill also. That tells me that we're
    probably moving toward the right types of resources.
        Another provision, and I think one of the more interesting
    ones in your bill and Chairman Pryor's bill, is the restoring
    of the Commission to five members. Apparently the sponsors feel
    that's important to be an effective agency, and we agree. An
    agency with five members makes for a more vibrant institution
    and would promote active discussion, compromise, and even
    dissent when necessary. And I think all those are good things.
    We can see that energy and I believe effectiveness in another
    agency under this Subcommittee's jurisdiction, and that's the
    Federal Trade Commission.
        I also see another advantage to that type of vibrancy and
    diversification by expanding to five members. And that it
    allows the President, whoever that might be, and Congress,
    through its confirmation process, to diversify the expertise on
    the Committee. And this is how I would envision it. By no means
    a recommendation, but this is what diversification could mean.
    You could have a Commissioner with a legal background, a
    Commissioner with experience in human factors, a Commissioner
    with knowledge about children and how they interact with
    products, Commissioners with experience in certain risk areas,
    such as drowning and fire and burns, a leading killer of kids,
    as you know for our work on the Pool Bill. And a Commissioner
    with background in engineering and product design. Again, by no
    means a recommendation, not my position to do that, but that's
    the type of diversification we'd like to see.
        We see that, by the way, hypothetically or not
    hypothetically, anecdotally at the NTSB. They've got members
    with aviation experience, boating experience--let's see, what's
    the other one--railway experience. So collectively, we see very
    good expertise at that independent agency, and we think they
    serve their mission quite well.
        Another provision of the bill that hasn't gotten a lot of
    attention, I'd like to spend a second on it. And that is the
    civil penalties. Right now, the civil penalties are at $1.8
    million. In our view, that is nowhere near enough economic
    deterrent, in order to promote a manufacturer or a company to
    do the right thing or an economic deterrent to doing the wrong
    thing. Now, whether it's $100 million, we can discuss with you
    and staff as to where that number might be.
        And here's a good example. If you've got $50 million of
    product in the marketplace, and you find out that there's a
    product hazard with that. And you think to yourself, ``Ooh, I
    need to report to the Consumer Product Safety Commission, but
    you know that if you don't you will only be fined $1.8
    million.'' Then you're throwing an economic component into that
    decisionmaking where it shouldn't be. One point eight million
    dollars, possibly by a civil penalty, or a $50 million recall.
    That should not be the case. There should be a higher deterrent
    to that, a company shouldn't be put in that place where they're
    thinking about that kind of economic ramification when it comes
    to safety. So we believe something higher.
        In the last few seconds, I want to talk about something
    that was just raised by my colleague to my right. And that is
    the product notification or direct notification to consumers,
    something you mentioned in your opening statement or in your
    questioning. I think there's a bill pending in the House right
    now that was just marked up at the House Energy and Commerce
    Committee, unanimously by bipartisan support. It's a--it's the
    Danny Keysar Child Product Safety Notification Act, which would
    basically do what is done with NHTSA, and that is require, on
    certain products like cribs, playpens, high chairs, and
    strollers. I think the recent news suggests why it's important
    to directly notify an owner of a product when they have a
    recalled product.
        So, I would urge the staff and the Committee to consider
    that pending bill in the House as a nice component to increase
    recall effectiveness in the CPSC Reform Act.
        My time is up. I'll--I'll be happy to answer questions.
        [The prepared statement of Mr. Korn follows:]

     Prepared Statement of Alan Korn, J.D., Director of Public Policy and
                         General Counsel, Safe Kids USA
        My name is Alan Korn, and I am the Director of Public Policy and
    General Counsel for Safe Kids USA, a member country of Safe Kids
    Worldwide. Safe Kids thanks the Senate Consumer Affairs, Insurance and
    Automotive Safety Subcommittee, and in particular Chairman Pryor and
    Senator Sununu for holding a hearing on the CPSC Reform Act of 2007 (S.
    2045) and ways to improve the overall operations of the U.S. Consumer
    Product Safety Commission (CPSC).
    I. History of Safe Kids Worldwide
        Safe Kids Worldwide is the first and only international
    organization dedicated solely to addressing an often under recognized
    problem: More children ages 14 and under in the U.S. are being killed
    by what people call ``accidents'' (motor vehicle crashes, fires,
    drownings and other injuries) than by any other cause. Formerly known
    as the National SAFE KIDS Campaign, Safe Kids Worldwide unites more
    than 450 coalitions in 16 countries, bringing together health and
    safety experts, educators, corporations, foundations, policymakers and
    volunteers to educate and protect families against the dangers of
    accidental injuries.
        Founded in 1987 by the Children's National Medical Center and with
    support from Johnson & Johnson, Safe Kids Worldwide and its member
    country, Safe Kids USA, relies on developing injury prevention
    strategies that work in the real world--conducting public outreach and
    awareness campaigns, organizing and implementing hands-on grassroots
    events, and working to make injury prevention a public policy priority.
        The ongoing work of Safe Kids coalitions reaching out to local
    communities with injury prevention messages has contributed to the more
    than 40 percent decline in the childhood unintentional injury death
    rate during the past 15 years in the U.S. However, with more children
    dying from accidental injury than from cancer, heart disease and birth
    defects, Safe Kids Worldwide and its member countries remain committed
    to reducing unintentional injury by implementing prevention strategies
    and increasing public awareness of the problem and its solutions.
    II. The Problem: Accidental Childhood Injury
        Accidental injuries are a leading cause of death for all Americans,
    regardless of age, race, gender, or economic status. Annually, an
    average of 27,100 deaths and over 33.1 million injuries are related to
    consumer products (although these are not necessarily caused by
    consumer products). Unfortunately, children make up a large portion of
    these tragic numbers. Each year, more children ages 14 and under die
    from unintentional injuries than from all childhood diseases combined.
    More than 5,300 children ages 0-14 die and there are over 6 million
    injuries serious enough to require medical care due to unintentional
    injury.
    III. The CPSC Reform Act of 2007 (S. 2045)
        In light of the recent news coverage surrounding the CPSC and
    product recalls, Safe Kids believes this is the perfect opportunity to
    address children's product safety on a comprehensive basis.
    Accordingly, Safe Kids applauds Senator Pryor, Senator Inouye and
    Senator Durbin for sponsoring the CPSC Reform Act of 2007. It is also
    our understanding that Senators Klobuchar and Nelson contributed
    extensively to the legislation and they should also be commended. We
    believe S. 2045 is an excellent legislative framework to not only
    remedy the CPSC's abysmal budget, but to also rejuvenate this important
    Federal agency that has not been reauthorized since 1990. Safe Kids
    supports many of the provisions contained in the CPSC Reform Act of
    2007:
    A. Increasing the CPSC's General Budget
        Safe Kids is particularly pleased that the CPSC Reform Act of 2007
    would dramatically increase the Agency's current operating budget to a
    sufficient level in order for it to properly fulfill its mission. The
    CPSC monitors the safety of over 15,000 types of consumer products,
    including kitchen appliances, sporting equipment, safety devices, home
    furnishings and art materials, and is charged with an enormous
    responsibility to keep families safe from injury and death. The CPSC
    must regulate consumer products, recall them when necessary, educate
    the public about safe use and behavior, and stay current on new injury
    product trends.
        Given its historically small budget and large statutory mandate,
    the CPSC has often been effective over the years, but could do much
    more with additional resources. The CPSC Reform Act of 2007 provides
    those resources by providing $759 million over the next 7 years--a 58
    percent increase over current levels. Safe Kids believes this infusion
    of funds is single-handedly the most important reform in the
    legislation and we applaud the bill's sponsors for arming the CPSC with
    appropriate resources in order for it to properly serve its critical
    mission.
    B. Dedicated Funds for Labs and Staffing
        Safe Kids also supports the separate authorizations to upgrade the
    Agency's dilapidated laboratory and to increase its staffing level.
    This will ensure that the CPSC can accomplish both these important
    tasks without having to make any difficult decisions about what should
    be prioritized in the new budget. In addition, having specific amounts
    of money authorized for the lab and hiring of staff sends the important
    message that these are priority tasks for the CPSC. Safe Kids agrees
    with those priorities:

            1. Upgrade the CPSC Lab

            Safe Kids has consistently advocated for an upgrade to the
            CPSC's lab facilities. In the past, Safe Kids staff toured the
            CPSC testing lab located in Gaithersburg, Maryland. The CPSC,
            among other things, uses this lab to test thousands of consumer
            products to ensure that they comply with existing voluntary or
            mandatory standards, or to determine whether or not they pose
            an unreasonable risk of injury to the American public. Safe
            Kids staff was impressed by the commitment and expertise of
            CPSC lab personnel, but was surprised by the poor quality of
            the lab's conditions. The CPSC to this day, while somehow
            fulfilling their mission, has done so with less than adequate
            technical facilities. We believe that the CPSC should have a
            lab that, at the very least, competes with those found in the
            private sector and that Congress should provide the funds
            necessary to upgrade the facility. The CPSC Reform Act of 2007
            provides for $20 million for the upgrade of this important
            facility.

            2. Staff to Carry Out Agency Responsibilities

            In addition, salaries for staff represent the largest portion
            of the CPSC's budget. However, the CPSC has gradually had their
            staffing levels reduced over the years due to budget
            constraints. This has resulted in fewer and fewer CPSC staff
            members to carry out the Agency's increasing responsibilities
            to keep children and families safe from defective and hazardous
            products. Not only has the Agency lost personnel over the
            years, but, significantly, the CPSC has lost key staff members
            through attrition who had in-depth experience and deep
            institutional knowledge. This is now the time to re-invest in
            staffing the Agency so that the CPSC, over time, will have an
            effective team with historical knowledge that can keep up with
            the fast-changing consumer product marketplace. Safe Kids fully
            supports the legislation's directive to have the CPSC be fully
            staffed with at least 500 employees by 2013.
    C. Increasing the Civil Penalties for Violations
        Safe Kids supports the increase in the civil penalty allowed by the
    Consumer Product Safety Act (CPSA), as contained in the CPSC Reform Act
    of 2007. In its present form (under Section 20 of the CPSA), any person
    who knowingly engages in a prohibited act, as outlined in Section 19,
    is subject to a civil penalty not to exceed approximately $1.8 million.
    In some cases, and in particular when larger companies are involved,
    the $1.8 million cap may not be enough of an economic deterrent to
    prevent the company from engaging in an unlawful act. For example, a
    company that has $50 million worth of product in the marketplace may be
    willing to incur the civil penalty instead of reporting a defect or
    injury as required under Section 15 in hopes of avoiding a recall
    (failing to report any information required by Section 15(b) is a
    prohibited act under Section 19 and is subject to a civil penalty).
    Safe Kids has long advocated for an increase in the civil cap to an
    amount that better represents a deterrent. We support the provision in
    the CPSC Reform Act of 2007 that would increase civil fines (for all
    statutes under the CPSC's jurisdiction) up to $250,000 per violation
    with a cap at $100 million.
    D. Restoring the CPSC to a Five-Member Commission
        The CPSC Reform Act of 2007 contains a provision that triggers an
    existing Agency authorization by expanding the Commission to five
    Commissioners, as opposed to the current membership of three
    Commissioners. The bill's sponsors feel that the Commission can
    function more effectively with a full complement of members. Safe Kids
    agrees; an Agency with five members makes for a much more vibrant
    institution and would promote active discussion, compromise and even
    dissent when necessary. We can see that energy, and I believe
    effectiveness, in another Agency under this Subcommittee's
    jurisdiction--the Federal Trade Commission (FTC). Due in large part to
    its full complement of Commissioners (and its adequate budget), the
    FTC, on the whole, effectively serves its mission by protecting
    consumers from deceptive practices and preserving a competitive
    marketplace.
        A five member Commission would also allow the President and
    Congress to expand and diversify the expertise of the CPSC through the
    nomination and confirmation process. For example, the CPSC could be
    comprised of the following:

       A Commissioner with a legal background;

       A Commissioner with experience in human factors;

       A Commissioner with knowledge about children and how they
            interact with products;

       A Commissioner with experience in certain risk areas, such
            as drowning or fires/burns; and

       A Commissioner with a background in product design and
            engineering.

        This is, by no means, a recommendation from Safe Kids as to who
    should be part of the Commissioner panel, but more illustrative of the
    opportunities that a five member Commission can present to the overall
    Agency structure as well as diversification. The diversification of
    expertise can be seen at the National Transportation Safety Board whose
    Board Members have individual, and therefore, collective knowledge in
    the fields of aviation, railway and boating.
        Safe Kids does, however, caution the Subcommittee that expanding
    the Commission by two members would also result in the need for
    additional budget resources for staffing, office space and travel. We
    believe that the budget relief provided in the CPSC Reform Act of 2007
    should be used first to improve overall Agency core functions--such as
    increasing recall effectiveness, marketplace policing and conducting
    enhanced public education initiatives--not using funds to augment the
    number of Commissioners. While we support the expanded Commission, Safe
    Kids believes that there other more pressing matters that need to be
    addressed first before doing so.
    E. Enhancing Product Recall Effectiveness
        There are many provisions in the CPSC Reform Act of 2007 that would
    enhance the effectiveness of product recalls and improve the strength
    of the CPSC compliance staff at the recall negotiating table with
    manufacturers:

            1. Elimination of the Election of Remedies Provision in Section
            15 of the Consumer Product Safety Act

            S. 2045 eliminates the ``election of remedies'' provision
            contained in Section 15 of the CPSA. Safe Kids believes this
            provision unnecessarily handcuffs the CPSC's compliance staff
            when they are negotiating a corrective action plan.

            Presently, once the Commission determines that a product
            distributed in commerce presents a substantial hazard and that
            remedial action is required to serve the public interest under
            Section 15 of the CPSA, the CPSC may order the manufacturer of
            the dangerous product to elect (at the product manufacturer's
            discretion) to either:

         Bring the merchandise into conformity with requirements of
                the applicable consumer product safety rule; or

         Replace the product with a like or equivalent product; or

         Refund the purchase price (less a reasonable allowance for
                use).

          (Consumer Product Safety Act, Section 15d)

            This discretionary election may not always serve the public
            interest. For instance, if the CPSC is recalling a $75 toaster
            that poses a serious electrocution or fire and burn hazard, the
            manufacturer, once ordered to remedy, may elect to refund the
            purchase price less a reasonable allowance for use. The refund
            on a toaster that has been in the marketplace for 5 years may
            have a refund value of $10. This refund may not be a motivating
            enough factor to encourage the consumer to remove the dangerous
            product from their household. In this case, the public may be
            better served by a different remedy--such as receiving a
            replacement item that is of similar quality or having the
            recalled product repaired. Safe Kids believes that CPSC
            compliance officers should ultimately decide what constitutes
            an appropriate remedy given the totality of the circumstances.
            We support the change to Section 15 of the enabling statute in
            the CPSC Reform Act of 2007 that empowers the CPSC to police
            the manufacturer's elected remedy option.

            2. Product Tracking

            The CPSC Reform Act of 2007 also contains a provision that
            would require manufacturers of children's products to place
            distinguishing marks on products or packaging that will enable
            the consumer to easily identify whether or not the item has
            been recalled. This requirement will make it much easier for
            consumers to quickly identify if a certain product has been
            recalled and hopefully return or dispose of the item in a
            timely fashion. Safe Kids supports this sound policy provision.

            Historically, recall rates are quite low and much of the
            problem can be attributed to consumers not even being aware of
            the recall itself. Recall ineffectiveness also stems from
            consumers not being able to easily determine whether or not the
            product in their possession is the recalled one. Safe Kids
            notes that the bill allows the manufacturer to put the
            distinguishing marks on the product itself or its packaging. We
            would assume that most manufacturers would choose to put the
            mark on the packaging instead of the product, especially when
            the items are particularly small in size. As parents and
            grandparents can attest to, packaging is most often disposed of
            when a new toy is brought home. As a result, the tracking
            information would also be discarded. Safe Kids believes that
            the distinguishing marks--when at all possible--should be
            permanently stamped on the product itself so that the tracking
            information is present throughout the lifespan of the item.

            In addition, Safe Kids recommends that all recall notices
            should highlight the distinguishing marks on the product. The
            simple existence of the marks is not enough--the recall notices
            need to incorporate color pictures of where the marks are on
            the products (or its packaging) as well as any graphics to help
            the consumer/parent/caregiver determine if there is a recalled
            product in their home. The CPSC recently released ``A
            Consumer's Guide to the Magnetix Building Set Recall''; this is
            a great example of the effective use of images and other
            graphic elements to convey safety information.

            3. Support for the Danny Keysar Child Product Safety
            Notification Act (H.R. 1699)

            In its present form, the CPSC Reform Act of 2007 fails to
            include an effective tool (product registration cards) that
            would help improve customer notification and, therefore, recall
            success rates. The Danny Keysar Child Product Safety
            Notification Act (H.R. 1699), sponsored by Representative Jan
            Schakowsky, would direct the CPSC to require manufacturers of
            certain children's ``durable products'' (like cribs, playpens,
            high chairs and strollers) to provide consumer product
            registration cards in order to help facilitate the recall
            process. This bill was recently unanimously approved by the
            full House Energy and Commerce Committee. Registration cards,
            in some circumstances, can be an important tool to help
            consumers become aware of potentially dangerous products in
            their home by allowing the manufacturer of a recalled product
            to directly notify the purchaser of the product about the
            recall and the remedial action warranted. We note, however,
            that the Danny Keysar Child Product Safety Notification Act
            would not require registration cards for all children's
            products; the requirement would only apply to products
            inextricably interwoven in a child's daily life. This tailored
            use of registration cards makes the Act very practical and
            targeted to only those products that, if they contain a design
            hazard, pose significant exposure to death or injury. We urge
            the inclusion of H.R. 1699 into the CPSC Reform Act of 2007.

            4. Authority to Re-Visit a Negotiated Corrective Action Plan

            The CPSC Reform Act of 2007 contains a much needed provision
            that enables the Agency and in particular, its compliance
            staff, to revisit an implemented recall corrective action plan
            that has not been effective. This is a particularly important
            tool for those recalled products that have a serious hazard and
            it can be determined that the recall effectiveness rates are
            insufficient (i.e., cribs that pose a strangulation or a
            playpen that unexpectedly collapses). Posed with this scenario,
            the CPSC can require the manufacturer to more aggressively re-
            publicize the recall with posters, paid advertising or an
            additional video news release, among other things.

            The CPSC Reform Act of 2007 also allows the CPSC to revoke
            completely a negotiated corrective action plan if it determines
            that a manufacturer or distributor has failed to substantially
            fulfill its action plan obligations. The manufacturer/
            distributor would then also be required to stop selling the
            product. Safe Kids believes that this provision may be
            redundant. We believe that once a product is subject to a
            recall, the manufacturer/distributor is already prevented from
            continuing to sell that product or must sell that product in
            its repaired form. We do believe, however, that ``failing to
            comply substantially with [manufacturer] obligations under [a
            recall] action plan'' should be considered a prohibited act
            under Section 19 of the CPSA. This would, in turn, trigger the
            authority to administer the civil penalties provision. Exposure
            to civil penalties provides an extra incentive for
            manufacturers/distributors to aggressively comply with an
            action plan in the first place.
    F. Third-Party Testing/Certification and Ban on Children's Products
            Containing Lead
        The CPSC Reform Act of 2007 would require third-party testing
    certification to ensure that children's products comply with any
    applicable product safety standards. It would also virtually ban lead
    in children's products, children's jewelry and consumer use paints.
    Associations, manufacturers, retailers and many consumer groups all
    agree that these are two concepts whose time has come. Add Safe Kids to
    this long list.
        We also have two concepts to add to the legislation. First, Safe
    Kids believes that the testing required by Section 10 of the CPSC
    Reform Act of 2007 should be done throughout the manufacturing process
    and on several lots to ensure that all products that may find
    themselves in the marketplace comply with applicable safety standards.
    The second involves the bill's provision that requires the Government
    Accountability Office to conduct periodic audits of third-party testing
    labs. The audit procedure described in the CPSC Reform Act of 2007
    addresses the expertise and qualifications of the third-party testing
    labs. Safe Kids believes that this audit protocol should be expanded to
    include a periodic assessment of the financial independence of these
    facilities. This will ensure that the certification labs are truly and
    continuously independent.
    IV. Conclusion
        The CPSC has used its relatively small budget and staff to
    accomplish an incredibly important task--keeping children safe from
    defective and hazardous products. As product-related injuries still
    exist and can be prevented, the CPSC is needed now more than ever to
    protect consumers, families, and children. Safe Kids commends Chairman
    Pryor and Senator Inouye, along with the other sponsors, for their
    introduction of the CPSC Reform Act of 2007 and we look forward to
    working with this Subcommittee on any efforts designed to protect
    children from product-related hazards.

        Senator Klobuchar. Thank you, Mr. Korn.
        Mr. McGuire, with the Association of Home Appliance
    Manufacturers. Thank you.

               STATEMENT OF JOSEPH M. McGUIRE, PRESIDENT,

              ASSOCIATION OF HOME APPLIANCE MANUFACTURERS;

         ON BEHALF OF THE NATIONAL ASSOCIATION OF MANUFACTURERS

        Mr. McGuire. Thank you, Senator. On behalf of the NAM CPSC
    Coalition, I'd like to thank you for this opportunity.
        NAM is the Nation's largest industrial trade association. I
    am President of the Association of Home Appliance
    Manufacturers, which represents producers of major portable and
    floor care residential appliances and their suppliers. I'm also
    a parent and youth sports coach and, quite honestly at times,
    obsessed with safety.
        The Coalition is committed to ensuring that the U.S.
    marketplace provides safe products to Americans. Government,
    industry, and the public have an opportunity to do something
    about enhancing product safety. We should stay focused on the
    core issues and problems, and fashion public resources and
    solutions to address them.
        We support enhancing the resources and the authority of the
    Commission to increase its effectiveness. Companies that work
    with CPSC recognize that it is thinly staffed, that many
    veteran employees are retiring, and that its information
    technology and laboratory are grossly inadequate. Although we
    believe that the American marketplace is safer than ever and
    the CPSC does a good job in leveraging its resources, the
    perception of many consumers is the opposite. This troubles us,
    as our economic viability depends on the confidence of the U.S.
    public in our products.
        But product safety is not just a Chinese issue, it pertains
    to all links in the supply chain, whether domestic or
    international. We support a number of general and product-
    specific legislative measures to increase CPSC's ability to
    carry out its mission. S. 2045 contains many provisions our
    Coalition supports and we applaud Senator Pryor and others,
    including you, for your involvement in these.
        However, the bill does contain some burdensome and
    troubling provisions, which would detract from CPSC's mission,
    increase litigation, and undermine the critical open
    relationship between CPSC and industry.
        The system generally works because--works well--because
    industry and other groups voluntarily develop new consensus
    standards and report problems voluntarily to the CPSC. The
    Agency needs more resources to do its job more effectively and
    to take advantage of existing statutory authority. For example,
    we support a variation of Chairman Nord's fast track
    rulemaking, to adopt a Federal mandatory rule from selective
    safety-related provisions of consensus standards. We recommend
    this action, where the consensus standard is up to date and
    protective of safety and where a substantial number of firms
    are not complying with it. CPSC should show that a mandatory
    standard will significantly increase the safety of the product
    and decrease possible injuries and deaths.
        In order not to undermine the private sector safety
    standard structure, the Commission should only adopt key safety
    aspects of these standards and rely as much as possible on the
    standards development organizations for updates,
    interpretations, and certifications under these standards.
        We also support the concept behind the provisions in S.
    2045, which would authorize CPSC to require specific products
    sold in our marketplace to show conformance through testing
    with safety standards. We strongly applaud making it a
    violation of Federal law to knowingly and willfully falsely use
    a mark or claim of certification.
        My written testimony contains many other of the provisions
    in which we support. I would also now like to talk about a few
    areas where we have some concerns.
        For example, whether deliberate or not, the bill would
    eliminate due process protections under Section 6(b) of the
    Consumer Products Safety Act for manufacturers. The bill is
    designed to expedite CPSC release of product safety information
    to the public by eliminating the opportunity of manufacturers
    to show that specific documents are of such low validity and
    accuracy, that release would be unfair.
        Under the pending legislation, the result would be a data
    dump of information of no value and little validity, but which
    can be used to gain leverage in litigation by competitors and
    for other inappropriate purposes. It will be a disincentive for
    manufacturers and retailers to voluntarily submit data and
    submit it early. The reality is that the delays in releasing
    information to the public by CPSC are not due to manufacturer
    objections, but to the Commission's outdated technology and
    search techniques, which can be improved with increased
    funding.
        Second, we oppose the proposal to allow states to enforce
    provisions of Federal product safety laws through litigation.
    States already have the ability to bring actions under Federal
    and State laws. This provision would not improve CPSC
    effectiveness, but rather would create an enormous new field of
    litigation and erect huge barriers to industry's cooperation
    with the Commission. It would also impede commerce by
    encouraging multiple State product safety agencies.
        Third, we oppose the provision that requires CPSC to
    adjudicate employee-employer disputes. The bill would divert
    significant Commission resources into investigating
    whistleblower retaliation allegations. We support enhancing
    CPSC resources for tasks needed to promote product safety--
    fieldwork, research, faster standards, and information
    dissemination and education. We oppose a new form of litigation
    driven by shared penalties, compensatory damages, and attorney
    fees.
        Fourth, we oppose the bills proposed penalty provisions.
    Today, virtually all penalties are agreed to voluntarily, but
    S. 2045 would increase the maximum cap to $100 million and per
    violation fines up to $250,000. This penalty structure will
    totally change the existing dynamic, where instead of
    negotiating recall terms expeditiously with CPSC, private
    lawyers will spend time advising their clients of the benefits
    of minimum cooperation with the Commission and other defensive
    postures. The results would be an unproductive regulatory
    environment, rife with diversionary litigation when so many
    dollars are at stake.
        [The prepared statement of Mr. McGuire follows:]

    Prepared Statement of Joseph M. McGuire, President, Association of Home
       Appliance Manufacturers; on Behalf of the National Association of
                                 Manufacturers
        Mr. Chairman and Members of the Committee:

        Thank you providing me the opportunity to testify on behalf of the
    National Association of Manufacturers (``NAM'') regarding S. 2045, the
    Consumer Product Safety Commission Reform Act of 2007. The NAM is the
    Nation's largest industrial trade association, representing large and
    small manufacturers in every industrial sector and in all 50 states.
        I am President of the Association of Home Appliance Manufacturers
    (``AHAM'') which represents the producers of major, portable, and floor
    care residential appliances and their suppliers. AHAM is a member of
    the NAM, where I have served in the past as Chairman of the Council of
    Manufacturing Associations, a division of the NAM comprised of more
    than 200 trade associations. An additional part of our NAM membership
    is AHAM's participation in the NAM CPSC Coalition. It is in that
    capacity that I appear before you today. On behalf of the Coalition I
    thank you for your leadership in addressing consumer product safety
    through this hearing and others and in seeking legislation to improve
    the effectiveness of the CPSC.
        All of AHAM's 165 members are regulated by the Consumer Product
    Safety Act (``CPSA'') and the other Federal safety laws administered by
    the Consumer Product Safety Commission (``CPSC''). AHAM and its members
    work cooperatively with CPSC on policy and individual product issues.
    It is the appliance industry's most important regulatory relationship,
    and justifiably so, because consumer safety is the most critical
    obligation we have to our customers. The NAM CPSC Coalition also is
    committed to ensuring that the U.S. marketplace provides safe products
    to Americans.
        The NAM CPSC Coalition supports enhancing the resources and, where
    necessary, the authority of the Commission to increase its
    effectiveness. To that end, we have aggressively supported increased
    appropriations for this Commission in this Congress, and advocate that
    these increased dollars be directed to enhancing the CPSC's personnel
    dedicated to product testing, evaluation and enforcement and to
    improved technology and facilities. In fact, we might be the only
    industry group to lobby the appropriation committees for agency
    funding, none of which will be spent on or granted to our members.
    Companies that work with the Commission recognize that it is thinly
    staffed, that many veteran employees are retiring, and that its
    information technology and laboratory are grossly inadequate. Modern
    technology makes it possible for a smaller Commission to be more
    productive than the larger Commission of the 1970s, but 21st century
    technology and resources must be put in place.
        We also recognize that there is a crisis of confidence in the
    safety of consumer products in the United States marketplace. Although
    we believe that the American marketplace is safer than ever, and that
    the CPSC does a good job in leveraging its resources, the perception is
    gravely troubling to U.S. manufacturers because their economic
    viability depends on the confidence of the U.S. public in their
    products. To some extent, the proportion of recalls from products
    manufactured in China, for example, reflect its growing market share in
    key consumer product categories. American consumers have benefited
    significantly from the efficiencies achieved by manufacturing many
    consumer products in China and other countries. There are unique
    challenges ensuring that foreign governments are performing their
    legitimate regulatory functions.
        Well before the publicity about product recalls this last year,
    AHAM has worked closely with the CPSC and with the Chinese government
    and industry to enhance the safety processes in Chinese manufacturing.
    We have been involved in a number of substantive meetings in China with
    national and regional government officials and manufacturers to
    emphasize the need to meet government mandatory and industry consensus
    standards and to build safety evaluation into every aspect of
    manufacturing and testing. Obviously, we support stepped-up efforts to
    ensure that Chinese producers throughout the supply chain are meeting
    the appropriate standards of safety and quality. The Coalition supports
    expanding U.S.-Sino joint programs and applaud regulatory initiatives
    such as the recently announced agreements in several product sectors.
    We believe that these programs are critical to advancing safety and
    that ongoing funding for international outreach and education is
    critical to CPSC's mission.
        In addition, the Coalition supports a number of general and
    product-specific legislative measures to increase CPSC's ability to
    carry out its mission. As I mentioned earlier this includes increased
    funding. S. 2045 contains a number of provisions our coalition supports
    and we applaud you and your staff for seeking improvements. However, we
    also believe S. 2045 contains some burdensome and troubling provisions
    which would detract from CPSC's mission, significantly add to the
    litigiousness of our society and undermine the critical open
    relationship between CPSC and industry. The system generally works well
    because industry and other groups voluntarily develop new consensus
    standards and report problems voluntarily to the CPSC. But, much of S.
    2045, as presently drafted, could very well result in more litigation
    instead of open dialogues within a relationship of confidence.
        Further, when we consider reauthorization and imposing new
    obligations on industry, particularly imported products, we need to
    weigh whether we are achieving significant enhancements of safety or
    whether new non-tariff barriers are being erected. We absolutely agree
    that imported products should be designed and manufactured just as
    safely as U.S. products. But, to impose trade barriers without regard
    to the benefits to American consumers of trade and integrated design,
    production and distribution of consumer products would be a mistake.
        There are proposals in S. 2045, Acting Chairman Nord's ``PRISM''
    proposal, and in proposals developed by NAM members that we believe
    will, along with greater resources for the Commission, significantly
    improve the ability of the Commission to carry out its vital mission.
        For example, we support a variation of Commissioner Nord's ``fast
    track'' rulemaking to adopt as Federal mandatory rules selected safety-
    related provisions of consensus standards. We believe that with greater
    resources these rulemakings could be conducted under existing law. We
    can support, for example, eliminating the need for an advance notice of
    proposed rulemaking and to decrease somewhat the substantive
    determinations that the Commission must make in adopting in whole or in
    part certain consensus standards. We recommend this action where there
    is a solid record that the consensus standard is up-to-date and
    protective of safety, that a substantial number of firms in the
    marketplace are not complying with the standard and that there is a
    substantial basis for believing that making the consensus standard
    mandatory will significantly increase the safety of the product and
    decrease possible injuries and deaths.
        In order to maintain and not undermine our private sector safety
    standards structure, we advocate that the legislation make clear that
    the Commission should only adopt key safety aspects of these standards,
    expedite revision of the Federal standard when the consensus standard
    has been revised, and rely as much as possible on the standards
    development organization's interpretations and certifications under
    these standards.
        We also support the concept behind provisions in S. 2045 which
    would authorize the CPSC to require specified products sold in our
    marketplace to show conformance through testing with standards. This
    presents a challenge with some 15,000 products under CPSC jurisdiction.
    However, we strongly applaud making it a violation of Federal law to
    knowingly and willfully falsely use a mark or claim certification.
        Although a globalized market may require the sharing of vital
    safety data with foreign governments and state and local authorities,
    this must be done in a manner that protects intellectual property and
    confidential business information and ensures that it is not used to
    prematurely instigate litigation or to unleash public allegations about
    non-public investigations. Certainly, firms should supply, if requested
    and known, to the CPSC information on their suppliers, distributors and
    retailers.
        We can support, with some modification to the legislation,
    revisions to the CPSC's authority to ban exports of recalled products.
    However, there are limited cases where foreign countries have
    protective but different standards. U.S. firms should not be banned
    from manufacturing and exporting a product compliant with those foreign
    laws.
        In the same vein, we support clarifying that it is a violation to
    knowingly sell a recalled product or to intentionally build up
    inventory of a product before new mandatory standards go into effect.
    Further, importers who repeatedly import unsafe products should not be
    allowed to participate in our marketplace and CPSC referral to Customs
    is appropriate. We also support a carefully tailored asset forfeiture
    provision and less use required of ANPR's in order to expedite
    rulemakings.
        The NAM Coalition supports a number of product-specific proposals
    which its industry associations and companies have brought forward.
    Much of this legislation relies on and enhances existing consensus
    standards and certification programs. The Toy Industry Association and
    The American National Standards Institute, for example, have a recently
    announced framework for a new mandatory testing requirement for toys
    sold in the U.S. That industry is working with the Congress to adopt
    legislation to ensure industry-wide adherence to mandatory testing,
    standardized testing procedures, and laboratory certification program
    for toys. Additionally, The Fashion Jewelry Trade Association advocates
    a national standard for jewelry modeled after laws in California and
    Minnesota to address concerns about lead content.
        The appliance industry supports Federal action to ensure the proper
    installation of cooking ranges with UL, ANSI and building code mandated
    anti-tipping products and equivalent devices. Although very infrequent,
    range tipping accidents can be avoided with the proper installation of
    these safety devices. Many building codes already require this
    installation, but we know that there are installers and landlords who
    often fail to install these devices. In many cases, homeowners resist
    the installation of the devices. Therefore, my industry proposes that
    it be a violation of Federal law for a person, at least a commercial
    installer or landlord, to install a range that is not compliant with
    the UL standard and building code provisions.
        I would like now to address provisions of S. 2045 that the
    Coalition either opposes or has suggestions of modification.
        Whether deliberate or not, S. 2045 would eliminate protections of
    Sections 6(b) of the Consumer Product Safety Act. Section 6(b)
    supplements the Freedom of Information Act and is specifically tailored
    to the realities of the information that the CPSC receives and
    generates internally. The CPSC receives a huge amount of information
    from consumers, doctors, fire investigators, competitors and others
    which is raw, unfiltered, and upon analysis proves to be either
    inaccurate--often identifying the wrong product or accident cause--or
    is unfair, unscientific or technologically flawed. In turn, internal,
    preliminary evaluations done by the Commission may be based on such
    incorrect information, necessitating further discussion and review of
    accurate data.
        Now, in and of itself, it is not a bad practice for the Commission
    to receive huge amounts of data, regardless of its quality, so that it
    can see early trends and spot incipient problems. In fact, a major
    initiative of the Commission with some of the largest retailers allows
    for the submittal of mostly raw and unevaluated consumer complaints and
    other safety related information to the Commission so that it can be
    integrated into its databases. Very little of this information proves
    to be useful for compliance purposes, but it does give the Commission a
    better view of what is happening in specific product areas.
        Under current law, firms are informed when information about their
    products is to be publicly released and are provided the opportunity to
    show that specific documents are of such low validity and accuracy that
    release would be unfair. Under the pending legislation, this system
    would be eliminated and many thousands of documents could be released
    which contain information of no value and little validity but which can
    be used to gain leverage in litigation, by competitors and for other
    inappropriate purposes. A huge barrier would be placed in the way of
    manufacturer and retailer cooperation with the Commission through the
    special retailer program. It also would impede the day-to-day filings
    under Section 15 where the Commission encourages firms to submit
    information even if they do not believe that a substantial product
    hazard or defect exists. The Commission should continue to ensure that
    information it publicly releases is not inaccurate or misleading.
        Delays in releasing information to the public are mostly due to the
    Commission's outdated technology and search techniques, which can be
    improved with increased funding, not the limited opportunity for
    industry to respond to a proposed release. A high percentage of
    manufacturers do not even comment on proposed disclosure and the CPSC
    has ``fast track'' disclosure authority for imminent hazards. We
    adamantly oppose the evisceration of Section 6(b).
        We oppose the proposal to allow states to enforce the provision of
    the Federal product safety laws through litigation. We support greater
    resources for the CPSC and other forms of partnership with states.
    Allowing, however, state officials to bring lawsuits against firms
    which could be based on totally unproven allegations of failure to
    comply with the law would create an enormous new field of litigation
    and erect huge barriers to industry's cooperation with the Commission.
    We oppose the ``Balkanization'' of the U.S. market into 50 state CPSCs.
    Combined with new expanded civil and criminal liability provisions, the
    result will be confusion and litigation. No state official should have
    the authority to interpret or reinterpret Federal regulation or policy
    as administered by CPSC.
        Similarly, we are not aware of incidences where company employees
    have been punished for bringing consumer product safety allegations to
    their company's attention. Yet, S. 2045 proposes diverting significant
    Commission resources into investigating whistleblower retaliation
    allegations. We support enhancing CPSC resources for tasks needed to
    promote product safety--field work, research, faster standards, and
    information dissemination, and education. We oppose a new form of
    litigation driven by shared penalties, ``compensatory damages'' and
    attorney's fees. Developing new forms of Federal torts is not the
    solution to enhancing the safety of products. We already have an
    extensive litigation in the product liability field and enhancing it
    will not result in increased product safety.
        We understand that many in the Congress believe that the current
    level of penalties per violation and the maximum cap under the CPSA
    need to be revised. We believe that the legislation adopted by the
    House Commerce Committee last week, H.R. 2474, makes an appropriate
    adjustment to the maximum cap by increasing it to $10 million while
    requiring the CPSC to adopt a penalty policy using relevant factors.
    Today, virtually all these penalties are agreed to voluntarily, but S.
    2045 would increase the maximum cap to $100 million and per violation
    fines of up to $250,000. This penalty structure will totally change the
    existing dynamic where, instead of negotiating with CPSC, private
    lawyers will spend time advising their clients of the benefits of
    minimum cooperation with the Commission and other defensive postures.
    The results would be an unproductive regulatory environment, rife with
    diversionary litigation when so many dollars are at stake.
        The real penalty to companies that violate standards or make
    defective products is the cost of the recall and the damage to their
    reputation, not the penalties. The levels of penalties in S. 2045 will
    be crushing to many small and medium sized U.S. firms, and as a
    practical matter will not be imposed on foreign firms which manufacture
    products for export but are not active in our marketplace.
        There are a number of other proposed provisions in S. 2045 which we
    oppose. For example, it is a violation of due process to dilute the
    ``knowing and willful'' requirement while at the same time expanding
    criminal penalties. Reversing the current preemption of Federal
    consumer product safety standards will only promote the creation of
    multiple, conflicting and confusing requirements and undermine the need
    for safety and uniform standards critical to the national and
    international marketplace.
        Some of the proposals require technical fixes and we will gladly
    work with staff on these. For example, the definition of children's
    products is so broad that it could inadvertently include many non-
    juvenile, conventional products for adults such as queen or full-sized
    beds, floor coverings or household furniture routinely used by children
    7 years or older.
        Several proposals in the legislation would authorize the CPSC to
    micromanage recalls in areas, such as choice of corrective action
    remedies, where it is much more productive and efficient to allow the
    companies to select the best manner to proceed. Nor should
    ``voluntary'' recalls become mandatory, thereby undermining the
    salutary process of encouraging ``fast track'' voluntary corrective
    actions.
        We believe that our position places safety first but opposes
    unnecessary new mandates, and litigation. We look forward to working
    with you and the Committee on adopting beneficial and reasonable CPSC
    reform in this Congress. I would be glad to answer any of your
    questions or follow up with any requested information.

        Senator Klobuchar. Mr. McGuire, your time has expired and
    we have a vote. So I'd like to let Mr. Thompson speak so he can
    get through his testimony, if that's all right. Thank you very
    much.
        Mr. Thompson with the retailers.

     STATEMENT OF AL THOMPSON, VICE PRESIDENT, GLOBAL SUPPLY CHAIN
                    POLICY, RETAIL INDUSTRY LEADERS
                           ASSOCIATION (RILA)

        Mr. Thompson. Good afternoon, Senator Klobuchar. My name is
    Al Thompson, I'm the Vice President of Global Supply Chain
    Policy for the Retail Industry Leaders Association or RILA. But
    more importantly, I am the father of two young children, so the
    issue of product safety, and particularly toy safety, is one
    that carries personal importance to me.
        RILA represents the largest and fastest-growing companies
    in the retail industry. Our members provide millions of jobs
    and operate more than 100,000 stores and distribution centers
    domestically and abroad.
        As Congress considers how to protect consumers,
    particularly children, from dangerous products, I want to
    outline some of the public policies that RILA supports and we
    welcome their inclusion in S. 2045.
        We support increased funding, Federal funding, for the
    Consumer Product Safety Commission or CPSC, as mandatory recall
    authority for the CPSC and a legal prohibition against
    knowingly selling a recalled product. We support the proposal
    to include tracking information on children's products to
    promote traceability. We support the increased lead standards
    in this bill. And we support the establishment of clear and
    predictable safety standards. On this note, we welcome the
    definition of a children's product in the legislation, because
    it is clear and workable.
        RILA members are strongly committed to assuring the safety
    of products sold on their shelves. In light of recent
    incidents, many of our members have enhanced product testing.
    For example, some retailers are now requiring testing for all
    toys, regardless of the manufacturer. Others are implementing
    more rigorous protocols to confirm the safety of toys through
    multi-layered testing and documentation. Our members have also
    reviewed and strengthened their internal policies and
    procedures for product testing, supplier compliance, and the
    sanction for non-compliant suppliers. Our members are also
    seeking better government standards and guidelines for product
    safety.
        RILA believes that ensuring product safety is a shared
    responsibility. Retailers have vigorous quality assurance
    requirements and enforcement mechanisms for their suppliers
    that manufacture goods for their stores. RILA members require
    their suppliers and manufacturers to understand and adhere to
    U.S. Government standards and regulations for particular
    products they produce; to operate secure factory environments
    and rely on known and approved subcontractors to produce safe,
    quality products; to maintain and document production processes
    that conform to the safety standards, beginning at the design
    phase and continuing through the completion of the finished
    product; and, to open their factories and production processes
    to periodic and, in some cases, unannounced quality and safety
    audits.
        When a product is recalled, retailers take prompt action to
    remove the products from the stream of commerce and properly
    dispose of them so they are not resold. After implementing a
    recall, our members also review their suppliers testing
    protocols to minimize the potential for future problems and
    take appropriate action or levy sanctions as needed.
        A successful safety regime requires a close partnership
    between the private sector and the U.S. Government, as well as
    other governments. While we welcome certain provisions in S.
    2045, RILA is also concerned that some provisions in the bill
    may undermine the critical cooperation that currently occurs
    regularly between the private sector and the CPSC. We believe
    Congress should exercise its authority under the Commerce
    Clause of the Constitution, to create standards for toy safety
    that are consistent, national in scope, and with a uniform
    enforcement mechanism.
        In many cases, our members sell the same items nationwide.
    For example, an Elmo doll sold at one of our member stores in
    Arkansas, is likely to be the identical to an Elmo doll sold in
    the same company store in Texas. These two products are
    manufactured from the same design, they come from the same
    factory, and may enter our country in the same container. Yet
    this legislation would support disparate civil enforcement
    mechanisms for these identical products.
        The State enforcement remedies in this bill, would also
    expose companies to unlimited liability. The proposal to
    increase criminal penalties and to substantially increase civil
    penalties would create a defensive posture in the private
    sector that could create disincentives for this type of self-
    disclosure. Many of the issues concerning product safety have
    come to light because companies have stepped forward to
    identify problems, immediately report them to the CPSC, and
    work collaboratively with the CPSC to take corrective action.
        Similarly, the bill's proposals to release confidential
    information disclosed by companies to the CPSC to other
    government agencies would create disincentives for companies to
    be forthcoming with information. RILA would support a
    requirement that safety testing labs also be credentialed by
    the CPSC or an independent third-party, such as the American
    National Standards Institute or ANSI. At a time when media
    reports that many independent labs are capacity constrained,
    RILA urges you to consider policies that would allow our
    member's state-of-the-art labs and their highly trained
    employees to remain part of the safety process.
        We appreciate the opportunity to testify before you today,
    and look forward to answering your questions.
        [The prepared statement of Mr. Thompson follows:]

    Prepared Statement of Al Thompson, Vice President, Global Supply Chain
               Policy, Retail Industry Leaders Association (RILA)
        Good afternoon Chairman Pryor, Ranking Member Sununu and Members of
    the Committee. My name is Al Thompson, and I am the Vice President of
    Global Supply Chain Policy at the Retail Industry Leaders Association,
    or RILA.
        RILA represents members including the largest and fastest growing
    companies in the retail industry, which together account for more than
    $1.5 trillion in annual sales. RILA members provide millions of jobs
    and operate more than 100,000 stores and distribution centers
    domestically and abroad.
        At RILA, I am responsible for representing the industry on all
    policies that impact our member companies' global supply chains. This
    includes issues involving transportation, logistics and security. In
    addition to my work at RILA, I also am the father of two young
    children, so the issue of product safety, and particularly toy safety,
    is one that carries both personal and professional importance for me.
        RILA appreciates this opportunity to submit testimony on Chairman
    Pryor's legislation, S. 2045, the ``CPSC Reform Act of 2007,'' and to
    showcase the steps that our members are taking to ensure product safety
    and integrity all along the supply chain. Our industry knows that it
    has no higher duty than assuring the safety and quality of the products
    it sells to its customers.
        RILA believes that ensuring product safety is a shared
    responsibility between and among manufacturers, retailers, this
    government, and other governments. Through rulemaking and laws,
    Congress and the Administration can provide guidelines that are clear,
    uniform and national in scope, so that manufacturers can better-issue
    detailed specifications to their suppliers and enforce those
    specifications with tests, audits, and follow-up. We commend Chairman
    Pryor, his cosponsors, and this Congress for taking quick action to
    promote the safety of consumer products.
        But before I fully describe the processes and product safety
    procedures that our members have in place, I want to describe some of
    the steps that our individual member companies have taken to ensure
    greater accountability from manufacturers in light of several recent
    high-profile product recalls.
        Because no two RILA members sell exactly the same merchandise, they
    each have slightly different protocols and procedures for evaluating
    the safety and integrity of supplier operations, as well as the safety
    of products on their shelves. In light of recent incidents, many of our
    members have:

       Enhanced product testing;

        For example, some retailers are now requiring testing
                and verification of safety compliance for all toys,
                regardless of the manufacturer. Others are implementing
                more rigorous protocols to confirm the safety of toys
                through multi-layered testing and documentation.

       Reviewed their internal policies and procedures for product
            testing, supplier compliance and the sanctions for noncompliant
            suppliers and manufacturers; and
       Joined with other allies seeking better government standards
            and guidelines for product safety, with a particular focus on
            products manufactured for children.

        Before I provide specific comments on S. 2045, I want to share with
    you some of the steps our members take to assure the safety of the
    products on their store shelves.
    Retailer Efforts to Assure Safe Products
        RILA members have a strong commitment to provide safe, effective,
    and affordable goods for their customers. We believe that ensuring
    product safety is a shared responsibility. As such, retailers have
    vigorous quality assurance requirements and enforcement mechanisms for
    their suppliers that manufacture goods for their stores.
        In particular, RILA members are actively working to reassure
    consumers that products, including toys and children's products, sold
    in their stores are safe. RILA believes that the most effective way to
    ensure safe products is to focus on the design and production of
    products so that product safety is built into products as they are
    made.
        To assure product safety, many RILA members require their suppliers
    and manufacturers--through contracts and product specifications--to:

       Understand and adhere to U.S. Government standards and
            regulations for the particular products they produce. Many of
            our members' specifications actually exceed U.S. Government
            standards;

       Operate secure factory environments, and rely on known and
            approved subcontractors to produce safe, quality products;

       Maintain and document production processes that conform to
            safety standards beginning at the design phase and continuing
            through completion of the finished product; and

       Open their factories and production processes to periodic
            unannounced quality and safety audits.
    Retailer Actions in the Event of a Recall
        When a product is recalled--either at the insistence of the
    government or a supplier--retailers take action:

       To immediately remove the product or products from the
            stream of commerce, and properly dispose of them so that they
            are not resold; and

       To notify purchasers, when possible, that they should return
            the product for a refund or replacement.

        These prompt actions are the result of protocols that virtually
    every RILA member has in place to respond to a recall and protect
    consumers.

       RILA members proactively monitor and research recalls and
            U.S. regulatory agency alerts to keep apprised of product
            safety issues. Some retailers have an entire department devoted
            solely to this effort;

       As soon as a product recall is initiated, RILA members
            implement existing recovery plans to remove the subject
            merchandise;

       Retailer inventory systems produce an error message at the
            point of sale if such products reach check-out cash registers,
            preventing recalled products from being inadvertently sold to
            consumers; and

       After implementing a recall, RILA members review their
            suppliers' testing protocols to minimize the potential for
            future problems, and take appropriate action, or levy
            sanctions, as needed.
    Comments on S. 2045, the ``CPSC Reform Act of 2007''
        RILA welcomes the opportunity to review and comment on S. 2045, the
    CPSC Reform Act of 2007. Retailers place the highest priority on the
    safety and quality of the products they sell to their customers,
    regardless of whether the products are produced domestically or abroad.
    Optimally, retailers seek to identify and remedy any product safety
    problems long before the product enters the supply chain or reaches
    U.S. stores. Therefore, RILA believes the critical point in the supply
    chain where product safety compliance efforts should be focused is at
    the point of design and manufacture.
        Prior to the introduction of this legislation, RILA was on record
    supporting government reforms that could better ensure toy safety. We
    are pleased that this legislation contains many provisions that our
    members strongly support. We look forward to working with Chairman
    Pryor and Members of the Committee to support these important
    provisions.

       RILA applauds the substantial increases in CPSC funding
            contained in this bill.

        RILA would welcome provisions that ensure that
                increased resources are used to accelerate the recall
                timeline and to promise better dissemination of recall
                information to the public.

       RILA welcomes the proposal to reduce the lead limits in
            children's jewelry to 200 parts per million (ppm), in surface
            coatings to 90 ppm, and in children's products to 400 ppm.

       RILA supports the proposal to include tracking information
            on children's products so as to identify the source, date, and
            cohort of production of the product. In fact, some RILA members
            already provide this type of information on their products.

       RILA supports the proposals to eliminate the requirement for
            advanced notice of proposed rulemaking and to place the Federal
            Hazardous Substances Act (FHSA) almost exclusively under CPSC
            jurisdiction. These proposals will help to streamline product
            safety enforcement.

       RILA would support a requirement that safety testing
            laboratories be credentialed by the CPSC or an independent
            third party such as the American National Standards Institute
            (ANSI).

        We are concerned, however, that the bill's requirement
                that the labs themselves be independent is a step backward.
                At a time when the media reports that many independent labs
                are capacity constrained, RILA urges you to consider policy
                alternatives that will allow our member's state-of-the-art
                labs and their highly-trained employees to remain part of
                the product safety process.

       RILA welcomes the definition of ``children's products'' in
            the bill because it is clear and workable, and helps companies
            to better understand the scope of products that would be
            subject to increased standards.

        RILA is concerned, however, that some provisions in the bill may
    undermine the critical cooperation that currently occurs regularly
    between the private sector and the CPSC.

       We believe that Congress should exercise its authority under
            the Commerce Clause of the Constitution to create standards for
            toy safety that are uniform, consistent, and national in scope
            with a uniform enforcement mechanism.

        The particular items that our members sell are
                virtually uniform nationwide. For example, an Elmo doll
                sold at one of our members' stores in Arkansas is likely to
                be identical to an Elmo doll sold in the same company's
                Texas store. These two products are manufactured from the
                same design, they often come from the same factory, and
                they may even come into our country on the same boat and in
                the same container. Yet, this legislation supports
                disparate civil enforcement mechanisms that would treat
                these two identical products differently.

       The remedies allowed through state enforcement include
            damages, restitution, compensation, or other relief, and would
            expose companies to unlimited liability.

       While we recognize that whistleblowers play an important
            role in ensuring corporate accountability, we urge Congress to
            carefully consider the implications of a whistleblower
            complaint adjudication process that would divert resources from
            the CPSC's efforts to develop better standards and better
            enforcement mechanisms.

       Many of the issues that have been before Congress concerning
            product safety are the result of companies that stepped forward
            to self-identify problems, report them to the authorities, and
            work collaboratively with authorities to take corrective
            action. The proposal to impose criminal penalties and to
            substantially increase civil penalties would create a defensive
            posture in the private sector that could create disincentives
            for this type of self-disclosure rather than collaboration with
            government regulatory agencies.

       Similarly, the bill's proposal to release confidential
            information disclosed by companies to the CPSC to other
            government agencies undermines the self-reporting protocol in
            place today. We believe this provision will create
            disincentives for companies to be forthcoming with information.
            The bill would eliminate the confidentiality between the CPSC
            and private industry. Disseminating confidential design,
            sourcing, sales, and product information to any government
            agency, domestic or foreign, increases the likelihood that this
            information will be disclosed to competitors.
    Conclusion
        RILA appreciates the opportunity to provide comments to the
    Committee as it considers S. 2045 and other proposals to improve
    product safety. RILA stands ready to work with Congress and the
    Administration to enact policies that strengthen consumer confidence
    and advance the production of safe, high-quality products that are
    affordable and readily available for consumers.
        Thank you for the opportunity to testify today.

        Senator Klobuchar. Thank you, Mr. Thompson, for your timely
    completion of your testimony. Senator Pryor has returned, our
    Chairman, and we are going to go vote and then come back. So we
    will be in recess for about 15 minutes and we will return for
    questions. Thank you.
        [Recess.]
        Senator Pryor [presiding]. Let me go ahead and reconvene
    the Subcommittee here. I'm sorry, we got called to a meeting
    off the floor here that we had to attend, but thank you all for
    your patience and--I'm sorry, I got pulled out right before we
    broke because I was trying to listen to everyone's testimony.
        Let me go ahead and dive in with some questions. And
    Senator Klobuchar's on her way, as well. Let me dive in with a
    few questions.
        For the first three witnesses we had, all of you all talked
    a little bit about how you'd like to see some changes in the
    legislation. You'd like to see one thing strengthened or one
    thing approached a little differently. And then the other two
    witnesses, you all said the same thing but related to different
    sections of the bill or in different ways. And I think that
    underscores the point of what we're trying to do here, which is
    find that balance. So, I just want to, again, encourage
    everyone here and all of your members and everyone to please
    come in and talk to the Committee staff, my staff, and all of
    the Senators' staffs to try to work through some of these
    issues because we really would like to move this.
        And like I said a few moments ago, we've had a lot of
    meetings with some of your members and some of you all
    specifically, but also we talked a lot about concepts. It's
    time for us to move to the concrete and try to actually do some
    drafting and if there are going to be some revisions or some
    concrete suggestions, we certainly would like to hear from
    people with very specific, even, language to try to help us
    move this process forward.
        Let me ask, if I may, Mr. Plunkett, about the fast track
    authority that Chairwoman Nord talked about. Does her approach
    concern you, and do you see her approach as inconsistent with
    the bill that we've drafted?
        Mr. Plunkett. Sir, this would be the fast track, what she
    deemed to be fast track authority that involves, essentially a
    separate private negotiation----
        Senator Pryor. Right.
        Mr. Plunkett.--to, at the request of the manufacturer. I
    don't see it as inconsistent, Senator. We don't, in fact, see
    the provision of confidential information, in some cases, as
    inconsistent with--with the notion that the Consumer Product
    Safety Commission should not be encumbered in any way,
    especially regarding important safety data in releasing that
    data as quickly as possible to the public. I think you can find
    a balance there that--that encourages industry to come forward,
    but corrects what we all acknowledge, or most acknowledge, are
    serious problems with the current product safety system, that
    don't, as we heard earlier, create enough disincentives to
    improper activity.
        I think you have largely hit on the right balance here.
    You've removed or excuse me, increased civil fine capability,
    you've mitigated some of the problems with 6(b). And I would
    suggest that if, NAM in particular, is concerned about
    increasing litigation under this proposal, they should support
    removing their essential, what is essentially a private right
    of action under 6(b), that virtually invites them to sue, to
    stop release of public information by the Consumer Product
    Safety Commission. I think the bill hits on the need to
    increase, make more strong enforcement efforts by the CPSC,
    while still allowing the kind of private efforts that
    Commissioner Nord spoke about.
        Senator Pryor. Let me ask, if I may--I don't know--Mr.
    McGuire, would you like to respond to that at all, since they
    mentioned NAM?
        Mr. McGuire. Well, as far as the last point went, on the
    6(b) point that was just made. Our concern there is that, I
    think what, it seems to me what you're after is to get at the
    delay in the release of information to the public. And we
    certainly are not opposed to that. What we don't want to do is
    remove some safeguards that allow the CPSC to determine whether
    the information that's to be released is valid, misleading,
    incorrect, or unfair. If that provision is removed, then the
    information going out to the public could be misleading and
    huge in volume. And that might create a disincentive for
    manufacturers and retailers to continue submitting data early
    now. We're encouraged now to submit, whether you're in doubt or
    uncertain, if there's a problem, submit the data. So we're
    doing that.
        So, it's seems like, there's a feeling that the reason
    there's a delay in getting the information out is because
    manufacturers are holding it up by reviewing it. That is not
    the case at all. The case is, CPSC needs more trained people to
    look at this data, to determine what's valid, what's not valid
    and then release it. And we're fine with that.
        Senator Pryor. There again, to get to the balance that
    we're trying to strike in the bill, we're trying to increase
    their personnel there and help them retain and recruit great
    employees to help with that problem as well. So we're trying to
    find that balance when it comes to the staffing needs there.
        Let me ask you, if I may, Mr. Thompson, about corrective
    action plans. Could you tell me generally how that process
    works at the CPSC and, what the experience has been with
    corrective action plans?
        Mr. Thompson. Yes, sir. Generally, as was mentioned, when
    one of our members, particularly if it's a product made for
    their product label, finds that there is an issue, they will
    report that information to the CPSC. And then, if it's
    something, in the example of lead paint, then they want that on
    a fast track to be able to get that information out because
    there's no need to determine, kind of, or evaluate whether
    something poses a safety hazard or not. In the event that it's
    not clear and if our stores feel that there could be a problem,
    they report that information to the CPSC and try to work with
    them to make a determination, so, that information can get out
    to the public.
        I would also say, as soon as we report, our stores report
    to the CPSC, they remove that product from the stream of
    commerce. And do what they have to do to ensure, not only that
    that product can't be sold in a store, but also that it can't
    be sold online. I think, in addition, and maybe the resource
    issue when it comes to it. I think some of our members would
    like to maybe see the legislation focus on, kind of, the
    process from CPSC standpoint, to ensure that the departments
    within the agency are actually coordinated, and also working
    together to get that information out in a timely fashion.
        Senator Pryor. Has that been a problem?
        Mr. Thompson. In some cases it has been.
        Senator Pryor. OK. Well, that's good information. We need
    to know that.
        And you all, both--I know, Mr. Thompson, you specifically
    have talked about the proposed criminal penalties. And I
    understand how criminal penalties give people heartburn.
    Believe me, I understand that. But, you know, there are
    criminal penalties that exist right now under the CPSA and the
    culture at the CPSC has been to only use the criminal penalties
    in very extreme cases. Are you familiar with any of the cases
    that they've used those in?
        Mr. Thompson. No sir, I'm not.
        Senator Pryor. As far as I know, unless you all will
    correct me on this, it's only been in one case that they've
    ever used it in 35 years. And so, just the culture there is
    that they're very, very reluctant to use that. Are you
    concerned that by beefing up the criminal portion of the bill,
    that they'll use it more? Is that a fair statement of your
    concern?
        Mr. Thompson. I don't think that's--that's the concern. And
    I think--and I'll caution right now--I'm not an attorney so
    criminal penalties are not my expertise. I think there's just a
    concern that the language right now as written, may be a
    disincentive for people to come forward quicker with
    information to the CPSC because they are concerned about how
    that would come back on them. But I don't think it's, the
    concern is on the idea of what the CPSC would choose or choose
    not to do.
        Senator Pryor. OK.
        Mr. McGuire, do you have a comment on that?
        Mr. McGuire. Senator, it's my understanding that the bill,
    with respect to criminal penalties, would lower the standard
    for when they would be applied, and potentially bring in a much
    broader net of directors and others and companies. And our
    concern is that that would have a chilling effect of the
    cooperative approach that companies have with the CPSC in
    negotiating recall actions and submitting data early and often.
        Senator Pryor. Yes. I understand that in the abstract, but,
    you know, given the nature of this Commission and given its
    track record over the years, they could have done that before,
    but apparently they've only done it in one case in their
    history.
        So, I'd love to sit down with you or your industry or your
    company further and talk more about that. But, you know, we
    ought to talk about that. But I'm not sure you're going to see
    a big increase in the criminal prosecutions under this Act. But
    we can talk about that and we can see. I understand, again I
    understand what causes people heartburn, I really do.
        Senator Klobuchar?
        Senator Klobuchar. Thank you, Chairman Pryor.
        As you all know, I'm very interested in making it easier
    for parents to identify toys when they have been recalled and I
    just wanted to get your thoughts on this. I understand that not
    every toy, a little pick up stick, can have the label on or the
    mark or demarcation. I don't think you'd necessary want to
    label it, because it would be pulled off. But most toys,
    including our little tree here that the child ate the paint off
    of, could have a batch number or date number at the bottom. And
    so that's why I'm interested in the toy, so it makes it easier
    for the parents.
        But also on the packaging--because I understand and maybe,
    Mr. Thompson, you can correct me if I'm wrong. For some of the
    retailers, they would need that because the minute they hear
    about a recall, they're able to put it in their computer system
    and they can't run out, run up any of the--and this is what
    Target has told me and Toys `R' Us--that they can stop that
    from happening at the point of sale. Is that right?
        Mr. Thompson. Yes, ma'am, that is correct. Once the recall
    notice goes out, our stores put in a ``block of sale.'' And it,
    not only in their physical stores, but on the Internet as well.
        In, to respond to your question on traceability, I think
    that's something that our industry's looking at moving forward
    on very quickly. Because we do feel that it will be helpful to
    better identify products that need to be recalled.
        And I can speak personally on this as a parent. I think
    when we were dealing with the Mattel products recall. In our
    case, it was Elmo and Diego. It was very helpful to make----
        Senator Klobuchar. It's always interesting to hear people's
    choice of toys.
        Mr. Thompson. My one-year-old, Elmo's his favorite word, so
    we try to satisfy him.
        It was very helpful to be able to look at some of the toys
    that had marks, to make a determination whether or not we
    needed to send that toy back or not. And I think better
    improving the ability, better improving traceability will go a
    long way to helping parents and consumers be able to make a
    determination on what they need to send back.
        Senator Klobuchar. And so, are you aware of some retailers
    that aren't the major ones, that might not have that ability in
    a computer system and would have to actually check on the
    shelves or, for instance, on eBay, if people are selling
    things?
        Mr. Thompson. I could speak to, at least some of our
    smaller retailers that, in addition, if they don't have the
    ``block of sale'' capability, even though I think the
    overwhelming majority of our members do. They also post
    signage, they put the--the picture of the toy up. So they do
    what they can to ensure that once a consumer walks into their
    store, that they know that this product has been recalled.
        Senator Klobuchar. I'm just trying to get to the
    desirability of not just having it on the toy, but also on the
    packaging.
        Mr. Thompson. I think the--I think if you--you can do it in
    a way where you can put it in multiple places, as long as it's
    feasible, I think we would be for that. I think, in some
    products I think our companies would like to see it on the
    packaging as well, just to make it easier for the consumer.
        Senator Klobuchar. Mr. McGuire, any response?
        Mr. McGuire. I think it's a reasonable idea. I can only
    speak to appliances and virtually all of the home appliances
    have a date of manufacture or some sort of indication on them,
    as to when they were manufactured. And it seems reasonable that
    all products have some sort of labeling or demarcation that the
    manufacturer or the retailers could work out with the
    Commission so that it made sense for retailers, consumers, and
    the--and the people in the commerce.
        Senator Klobuchar. Thank you. I appreciate that. And if you
    could share with your members in the toy area, that we are,
    what we do have in the legislation, to the greatest extent
    feasible, understanding that there are certain tiny toys that
    you're not going to be able to put a label on or mark I should
    say, but you could on the packaging.
        I wonder if any of our consumer representatives here, Mr.
    Korn, Mr. Plunkett, and Mr. Mierzwinski--whose name is almost
    as hard as mine--might want to talk a little bit about this
    identification issue.
        Mr. Mierzwinski. Well Senator, I'll just be brief on that
    and maybe Alan or Travis would want to go into detail. But
    we'd--we'd obviously support product traceability. When PIRG
    finds toys and we deliver them to the CPSC, often some of the
    worst dangers are the very small cheap toys. And they may not
    have any kind of manufacturer mark of any kind of them. So, we
    all support that.
        I wanted to make a comment on something earlier, that has
    been brought up, kind of, all through the whole hearing. And
    that is the issue of recalls. I think that underlying the whole
    discussion of recalls is that every product that is recalled is
    actually taken off the shelves.
        In fact, because of the voluntary nature of recalls, that
    is not always the case. Senator Durbin brought up the cribs.
    The cribs were not taken out of the people's homes. You could
    not bring your crib back. They sent you a little envelope full
    of little parts and you had to fix your own crib.
        Mr. Korn has with him the Magnetix toys from Rose Arts.
    Those toys were not recalled, even though young Kenny Sweet
    died when he swallowed several of those toys and they--they--
    the magnets bound together in his intestine. They simply issued
    a replacement program. The old toys stayed on the shelves.
    That's why the provision in the bill, the corrective action
    provision that strengthens the CPSC's authority, we think is a
    very important one. Because it gives you more leverage in the
    negotiation of recalls to force the manufacturer to do a better
    job of getting the hazards off the shelves.
        Senator Klobuchar. Mr. Plunkett?
        Mr. Plunkett. On the traceability issue, Senator. In our
    testimony, we recommend that the bill be improved by requiring
    the traceable code on both the package and on the toy.
        Senator Klobuchar. And I agree with you on that.
        Mr. Plunkett. And I think you've hit--you've already hit on
    why that's important. I'll just add one more thing. My son had
    two toys that were recalled, both were gifts. And in one case,
    the gift, the packaging was removed from the gift as part of a
    birthday party bag that, you know, that the present was put
    into. So we had no way--if the code had only--in such a
    circumstance, it was only on the package, we would never be
    able to trace the product.
        Senator Klobuchar. And I also believe that it leads to more
    anxiety for parents, if they're trying to figure out--they hear
    about a recall, they look on a website--and if they could know,
    then they could--they'd feel like at least they're doing the
    right thing for their kids.
        So, Mr. Korn?
        Mr. Korn. Thank you, ma'am. The bill as it's written right
    now does have an ``or'' provision in it that--I think that's a
    pretty easy change that we would support, to make it an
    ``and,'' to get to that situation where, if the packaging is
    thrown out and you can do some identification in the home,
    which is where the difficult problem is.
        It is a--retailers do a generally good job of getting their
    product off the shelves. It's getting them out of the daycare
    centers, out of the homes that is the difficult task. These are
    just recalled products in my home. I pay attention to these
    types of things. That's where the recalled products are. I can
    almost guarantee you we can go to the Senate daycare center and
    we could find three or four, possibly more, recalled products
    in there. People just don't know.
        Number two is, and Chairman Pryor missed this conversation
    when he was out, so I just want to emphasize it for 1 second.
    There is--there's a bill pending in the House, child safety
    seats come with product registration cards. So that when
    there's a recall, the manufacturer directly notifies the owner
    of that product that there has been a recall. Or better yet,
    can direct mail the repair item, if that's the best way to go.
        There's a bill pending there in the House, that came out of
    the House Energy and Commerce Committee, unanimously with
    bipartisan support, just marked up last week, that would
    require this kind of thing--not on all toys or products. I
    think it's impractical for some of these type of things. But
    for cribs, playpens, other durable products, those products
    that are inextricably interwoven in a child's life. And I think
    there's some use there and I can provide that legislation to
    your staff.
        And then finally, there's a provision in your bill that's
    very good, that allows the compliance staff at the CPSC to
    revisit a recall that has not been effective. And maybe work
    with the manufacturers again to say, ``You know, what we did
    last time wasn't good enough. We still have cribs our there, we
    still have playpens out there. Let's revisit it, and give it
    another try.''
        I--we also might want to think about adding to Section 19,
    the prohibitive act section, failing to substantially comply
    with the corrective action plan, could be a Section 19
    prohibitive act. So----
        Senator Klobuchar. Mr. Thompson, just one last question
    that was raised. Mr. Mierzwinski raised this issue of the
    concern about some of the recalled products being on the
    shelves. And I know that a lot of the retailers, as Mr. Korn
    mentioned, have been doing a good job, but I've heard from the
    retailers their concern about the average time it takes for the
    Consumer Product Safety Commission to recall a product after a
    problem was reported. Do your members feel that it's an
    acceptable amount of time?
        Mr. Thompson. I would think that they do not believe that.
    It's, right now in most cases it's an acceptable amount of
    time. And I think----
        Senator Klobuchar. I think it's approximately 6 months, is
    what I've heard.
        Mr. Thompson. It does depend, but I know on one recent
    case, it was 6 months. And we just felt that, in many ways,
    that is way too long. And it gets to the point of what Mr. Korn
    was saying, is we will, once we determine there is a problem,
    we will remove, our stores will remove that, those goods from
    the shelves.
        But to get to the point of where you need to get that
    information out to the public so it can get out of the daycare
    centers and the homes. CPSC generally frowns upon retailers
    from taking that action on products that are under their
    jurisdiction. They feel that is their responsibility. So we are
    waiting on them to be able to do that, so we not only can, so
    we can also prepare to receive those goods back from our
    customers.
        And any measures that, the legislation needed to streamline
    that process and make it quicker and more effective, even on
    the--even on the fast track, will be helpful. Because we don't
    want to have to follow up and rely and wait months, and months,
    and months with CPSC, to be able for them to announce a recall
    notice.
        Senator Klobuchar. Thank you very much.
        Senator Pryor?
        Senator Pryor. Thank you, Senator Klobuchar.
        Let me come back to a point that I made earlier with acting
    Chairwoman Nord. And that is, I have a letter here from the
    Consumer Product Safety Commission and it's actually dated
    August 12, 2004. And what they are doing is they are forwarding
    a complaint that they received in their office, at the CPSC.
    They're forwarding it to NHTSA, the National Highway Traffic
    Safety Administration.
        And one of the things I just want to point out for our
    witnesses and for the record, is that this e-mail that is the
    complaint itself, about a car seat, was posted on the Internet,
    posted on NHTSA's website. And what they do, is they black out
    the personal information and they show the world--anybody that
    wants to look--that there has been a complaint about a certain
    type of car seat. This is before they do a recall or before
    there's any action taken.
        But the question I would have, especially for our two
    manufacturers here and retailers here, is why not allow--or
    even require--the Consumer Product Safety Commission to have
    that same type of transparency. The reason I say that is NHTSA,
    in this case, doesn't comment on it. They don't verify it or
    try to say it's true or not true. But they post it so that
    people who are interested can look and find out what kind of
    complaints are out there. So, Mr. McGuire, do you have any
    thoughts on why we shouldn't have that same type of policy over
    at CPSC?
        Mr. McGuire. In general, I think that type of policy is a
    good idea. What you want to do is make sure that, in this
    case--I'm not familiar with this particular example you're
    talking about--but you'd want to make sure that confidential
    business information is protected. And you would also want to
    make sure the e-mail, if it's an e-mail complaint, is, has some
    validity to it, that's it not a complete mistake or
    misidentification of a product or a brand or a company.
        But CPSC has the authority today. I was talking earlier
    about Section 6(b). And manufacturers have the right to talk to
    CPSC before they release certain information to the public that
    might be unfair. But CPSC, if they believe there is a danger of
    a violation, they can--they can go ahead over our objection or
    anyone's--and release that. We're not opposed to CPSC sharing
    more information with other governments, foreign governments or
    other agencies. But I think protections need to be maintained
    and that's an area where we would be happy to work with you and
    your staff to get a balanced approach.
        Senator Pryor. Good. What would you like to----
        Mr. Plunkett. I think the issue isn't necessarily, it's
    putting protections in the legislation that ensure that
    proprietary information and confidential business information
    is--is protected. And if it's, basically, blocking out that
    information or not listing specific names or manufacturers, I
    think that's something we'd be interested in. Because we've
    also dealt with this in the House, but I think it's just
    ensuring that the legislation does protect proprietary
    information.
        Senator Pryor. OK, great.
        Let me just say that, Mr. Thompson, in your testimony, in
    your written testimony, you talked about the need to speed up
    the recall timelines, which you've mentioned as well, and
    create better dissemination of recall information to the
    public. I think those are worthy goals. We're trying to do that
    in the legislation, but do you have a different approach or,
    how would you recommend that those goals best be accomplished?
    What should we do? How can we improve the process that's there
    now?
        Mr. Thompson. I think it's, you know, I know Senator
    McCaskill was mentioning the IG, but I think it's making sure
    that, in addition to that, with the resources, that there is
    some type of plan to ensure that the processes within CPSC are
    going to be inline with that. So that the departments are
    actually working better together, whether it be the Compliance
    Department and the Public Affairs Department, but just ensuring
    that their processes are working in a harmonious fashion to get
    that information out.
        I think another thing that has to be looked at, in addition
    to making sure they have the resources and the people to make
    these determinations, is how do they better communicate with
    the public. And that can be done in numerous ways, but as a
    parent I'd like to necessarily not always find out about recall
    information through the newspaper or the media. I think I'd
    like to have some of that information from CPSC. And whether
    they do that over the Internet or find a way to do that for,
    you know, underserved communities particularly, I think they
    have to find a better way to do that.
        So, I think it's definitely more bodies, I think it's
    definitely better technology, but if their processes aren't
    improved internally, to not only make determinations and get
    information out, the problem's still not going to improve as it
    should.
        Senator Pryor. You know, you've really put your finger on
    something that is a real challenge. And that is how are people
    notified? I remember when my children were younger, they had
    those Star Wars light saber toys, where they went out and beat
    people up in the front yard, you know, that kind of thing.
    And----
        Senator Klobuchar. Again, people's choices of toys are
    interesting, Senator Pryor.
        Senator Pryor. They light up, you know, they make noises,
    all that. It's great.
        But anyway, our kids were out there playing 1 day in the
    yard and my sister-in-law came over and she said, ``You know, I
    think I saw something on the news that those have been
    recalled.'' Well, how does a parent find out that information?
    You know, where do you go? I mean, you don't even know where to
    start.
        And so, what we did in Arkansas is we actually started a
    website called childproductsafety.com, and all we did is take
    the information that the CPSC was releasing on their website
    and NHTSA and maybe one or two other agencies. And basically,
    we just put a new face on it and tried to promote it in
    Arkansas so that people would have one place where they could
    go. And it was kind of a seamless deal; wherever the
    information was coming from, it was really easy to access.
        I mean, that's how we tried to do it. And I'm not saying it
    was perfect, but, we were trying and we promoted it and we got
    good feedback on it. But it really is hard to get that
    information out.
        And the other thing I was just going to say about the
    Attorneys General, is, having been one and I'll admit a little
    bias here because I really saw the value in 4 years in that
    office, I saw the value of what states can do when they all
    work together. But when we sat with the Consumer Product Safety
    Commission several months ago as we were starting this process
    on this legislation, they told us that, I believe at that
    point, the number one action that they had out there was on
    lighters.
        Did we get the number on this?
        And from 1997 to 2005, there were 352 incident reports
    related to lighter failure. Sixty-five percent of these lighter
    failures resulted in fires, and that led to four deaths and
    then a number of serious injuries. And so the CPSC is really
    focused on these lighters and as it turns out, the lighters
    that they're most focused on, the lighters that have the
    problem are imported from China.
        And, so we talked about that and I remember, in listening
    to Chairwoman Nord and the CPSC staff talking about that, I was
    just thinking, wouldn't it be good--instead of having one
    agency here in Washington trying to deal with lighters all over
    the country, being sold in convenience stores and grocery
    stores and other places all over the country--wouldn't it be
    good to have 50 district offices, so to speak, State offices
    for the CPSC to go out after some of these incidents that are
    happening in their states and happening in their communities?
        So, I think that, it's almost like putting more cops on the
    street, in that if we build the right framework around it, I
    think that the public would really be served if Attorneys
    General had the authority to enforce this law. I think that
    would help in the Federal-State collaboration, but I also think
    that these Attorneys General around the country have a lot of
    background and expertise that they can offer in this area.
        Almost every AG, out of 50, probably 44, 46, something like
    that, have some sort of consumer authority right now. We had
    what we called the Deceptive Trade Practices Act. And so, we
    had a Consumer Protection Division and many, many other states
    had something very similar. So, it just seems that you have a
    ready resource there, that's willing and able to step in and
    help with this challenge that we see around the country.
        So, just before we move on, does anybody have any comments
    on the State Attorneys General issue? Because the previous
    panel did.
        Mr. Plunkett. Senator, there is just a great deal of
    evidence in the last decade that what you say is absolutely
    true. We have Federal agencies and Federal law. The resources
    of those agencies are limited. Where we have states involved in
    enforcing those laws, we have better enforcement and better
    consumer protection. When it comes to telemarketing, when it
    comes to securities, in many cases--over a wide variety of
    agencies and products and services, it's as close to received
    wisdom as I have, given my experience in Washington. I think
    you're absolutely correct.
        Mr. Mierzwinski. Senator, I would add, I'd be happy to try
    to put the data together, but there are a number of existing
    Federal laws where Attorneys General already have this
    authority. And so, this is not a new idea, it's an important
    idea. But I will say that in the last couple of years in my
    advocacy, that the industry lobbies have been trying to remove
    Attorney General authority in places where it currently exists
    to enforce Federal law. So I'm not surprised that they're
    trying to prevent Attorney General authority from being added
    to Federal laws.
        It's a tremendous benefit, as Travis pointed out, to have
    51 consumer cops on the beat instead of one. And Attorney
    General enforcement is strongly supported by every single
    consumer organization.
        Mr. Plunkett. And there are several very good examples of
    Federal agencies working closely with--as you well know,
    Senator--with State Attorneys General, such as the Federal
    Trade Commission on a number of other statutes.
        Mr. McGuire. Senator, I already spoke a little bit on this
    and I realized I have two former prosecutors up there, so I'll
    be careful. But we are not in any way----
        Senator Klobuchar. We don't have jurisdiction over you.
        [Laughter.]
        Mr. McGuire. OK, well then let me really--we are not trying
    to remove any existing authorities from State Attorneys General
    and we're all for having more cops on the beat. We're all for
    more resources.
        Our concern is over different interpretations and different
    enforcement actions and that's a different thing. So, I think
    we're with you quite a bit in your desire to make the agency
    more effective and have more resources put in. And I think
    there are a lot of things that technology can do in the areas
    of recalls and notification and education.
        Senator Pryor. Thank you.
        Did you have any other questions?
        Senator Klobuchar. Just to finish up, I wanted to go back
    to the reason that we put this lead standard in, and I know
    there's some debate on where it should be set. And I don't
    quite want to go in there for the trace levels. We can talk
    about that later. But I mostly was focused on the reason that
    we tried to do this as opposed to a line for rulemaking, which
    some of the earlier bills had done.
        And it was my impression, based on my discussions with
    Commissioner Nord, as well as people who've practiced in this
    area, that putting this in the rulemaking process could be
    untenable. At the same time, we wanted to allow for rulemaking
    if, for certain products, or a change in science, it was
    determined that the trace lead level at which we set it was too
    high.
        So, what we ended up doing in this bill was to set it at
    the .04, I think its parts per million, and the .02 for
    jewelry, and then allow for rulemakings if the CPSC would like
    to go beneath that level for certain products.
        And I'll tell you where I came down on this. I felt that if
    we didn't do that, even though it was a little risky to go out
    there with a trace level, we would be just stuck waiting and
    waiting and the consumers would be waiting, in terms of having
    a standard. And mostly the CPSC, with its limited resources,
    would be waiting to be able to enforce it.
        So I mostly wanted to hear from the consumer advocates
    about your feelings about the idea of, regardless of where the
    trace level is set, about putting an actual Federal standard
    into law.
        Mr. Korn?
        Mr. Korn. I think it's certainly the prerogative of
    Congress and you can do that instead of going through the
    rulemaking process at the CPSC. Just like you can control the
    jurisdiction of the CPSC by declaring something a consumer
    product or not, so that the CPSC can work toward making it a
    safe product. You can also declare something banned and lead in
    toys is something that you'd certainly have the prerogative to
    do, and we're supportive of that.
        And I don't think there's very much disagreement amongst
    anybody, as to whether or not that's the way to go now. I mean,
    I think almost everybody is in agreement there. So, I think
    you've crafted a good piece of legislation there.
        Senator Pryor. Thank you.
        Mr. Korn. I'll mention one other thing. While sitting here,
    I got an e-mail notice from the Consumer Product Safety
    Commission about eight additional recalls today, about lead in
    products.
        Senator Klobuchar. And now you're going to go home and
    look?
        Mr. Korn. Yes, you have to. But you can sign up. Senator--
    Chairman Pryor, you were mentioning how does the parent know?
    You can sign up for this recall alert and get them right away,
    you know, if you have the computer access. That's an issue
    there, but it's a good way to get information.
        Senator Klobuchar. Mr. Plunkett?
        Mr. Plunkett. I would just add one thing. We agree that
    your approach is a good way to start here. Regarding the
    inevitable question of enforcement, it's come up in terms of
    lead paint, where we have a standard already and poor
    enforcement track record.
        Let me point out that two of the measures in your proposal
    will help there. The civil fine provision that we've already
    spoken about, and the third party testing provision that we're,
    that has already been mentioned at length.
        So, you all are not only setting a better standard, you are
    improving the chances that those standards will be well
    enforced.
        Mr. Mierzwinski. Senator, I just want to echo that your--
    your approach is absolutely the better approach, than to give
    this to rulemaking. And we strongly support that. And, as Alan
    pointed out, there is precedent for Congress banning--banning
    certain products that are hazardous on face. And by avoiding
    the long, drawn out rulemaking, it's the right way to go.
    Everybody agrees that getting lead out of the environment is
    the way to go. And if Congress does it, you do it cleanly.
        The second problem, of course, is that CPSC rulemaking,
    they don't have the resources as you've heard and as you know,
    and a rulemaking takes forever. So, it's--it's absolutely the
    right way to go. And I, we believe that it's, was worth
    pointing out to the Committee that there are groups that are
    suggesting higher or better trace levels, and we hope to work
    with you on that. But we absolutely like what you guys have
    done.
        Senator Klobuchar. OK. Thank you.
        And I, again, wanted to thank these retailers and
    manufacturers who have been willing to work with us on this.
    Mattel testifying at the last hearing we had. Toys `R' Us
    appearing there from the retail standpoint. It was very
    helpful, gave us information, and it's helped us as we craft
    this bill to make sure that it's smart from a consumer
    standpoint but also practical to implement.
        And thank you again, Chairman Pryor, for your work.
        Senator Pryor. Thank you.
        I'm finished with my questions. And I want to thank Senator
    Klobuchar for being here and participating and helping draft
    this legislation.
        But I do want to make four points in closing. One is, that
    we've talked about the State Attorneys General and the CPSC.
    And again, we're trying to find the balance. We've talked about
    that a lot today. And under our language that we've drafted
    into the bill, the states would have to give the CPSC 60 days
    notice before they proceed. And also, the CPSC has the right to
    intervene in the litigation. So again, we feel like that's a
    Federal-State balance there and there's a little check and
    balance, which we think is the right balance. We hope it is.
        The second thing I was going to say is, I know there's a
    concern about information sharing and too much information
    going out, especially proprietary information. Well, Section
    6(a)(3) of existing law, covers that. And we don't change that.
    Basically it says, in summary, not to read the whole thing, but
    basically, manufacturers, you know, are protected from the
    release of confidential information.
        And again, you all can look at that. We don't change that.
    We do change some of the things around that--that you may want
    to look at, but again, we're trying to find the protection
    that--we're trying to be sensitive to proprietary sensitive
    information.
        And the third point I'd make is, what I said in the very
    beginning. Now's the time to come in and talk about these
    things and try to shape this because we would like to move this
    legislation. I've talked to Senator Inouye today, and he told
    me that he's prioritizing this and he wants to try to get it
    out as quickly as he can. So, don't wait, and don't think that
    this is going to take weeks or months to get going. I mean,
    we're starting right now. We've been working on this for a good
    while, but we are moving. The train's leaving the station. So,
    we encourage everybody to come in and weigh in and sit down and
    talk through this, with us.
        And the last point is, I just want to say thank you.
    Because you all have been great. The fact that you've spent so
    much time here with us today and so much time in preparing. And
    like I said in the beginning, industry has really responded to
    a lot of these recalls in a very positive, proactive way, and
    we appreciate that. That's not been lost on this Subcommittee
    or the Committee. There are a lot of great companies out there
    that are really trying to address this in their own way. But I
    still think there's a need for comprehensive reform. I think
    most Senators and Congressmen would agree with that as well and
    would try to reauthorize CPSC in a way that prepares it to meet
    the challenges that we face today.
        Again, I want to thank you all for being here today and
    participating. We're going to leave the record open for 2 weeks
    to allow Senators to provide written questions. We appreciate
    you all getting back with us as quickly as you can on those.
    And if there are documents or studies or whatever you all
    have--someone mentioned that before--if you want to submit
    those for the record, we'll be glad to accept those.
        So with that, we're going to adjourn the hearing and just
    say thank you very much.
        [Whereupon, at 6 p.m., the hearing was adjourned.]
                                A P P E N D I X

     Prepared Statement of Hon. Barbara Boxer, U.S. Senator from California
        Chairman Pryor, I want to thank you for all of your hard work on
    this bill that is so important to our children and families.
        As both a parent and a grandparent, I have been incredibly
    distressed by the seemingly endless stream of reports about defective
    and dangerous children's toys and products.
        Forty percent of all consumer products, nearly $250 billion, were
    imported into the United States last year from China.
        The Consumer Product Safety Commission currently employs only 420
    full time employees responsible for ensuring the safety of well over
    15,000 products totaling $614 billion.
        The products CPSC monitors range in diversity from baby products to
    playground equipment to cell phones. Given that range of responsibility
    for protecting consumers and a budget of only $63 million annually, I
    worry that we simply have not done enough to ensure the safety of
    products coming in through our borders.
        As foreign imports soar, now is the time for us to step up our
    efforts to ensure that the food we consume and the products we use are
    as safe as possible.
        I am pleased to see this bill significantly increases the
    authorized funding amount for the CPSC each year through 2015 and
    provides for penalties for violations of this Act.
        While I am glad to see this bill gives the CPSC authority to ban
    the export of dangerous products that are unfit for sale in the United
    States, I believe we must do more to ensure that no children anywhere
    are exposed to dangerous toys.
        I also favor strengthening the recall provisions of this bill so
    consumers are given the proper information necessary to ensure the
    safety of their families.
        I again want to thank Senators Pryor and Inouye for all of their
    efforts on this important bill.
        Thank you, Mr. Chairman.
                                     ______

       Prepared Statement of American Council on Electrical Safety (ACES)
        The American Council on Electrical Safety (ACES) would like to
    insert, for the record, information on an existing program,
    administered by the U.S. Department of Labor, OSHA, titled Part 29,
    Section 1910.7, Definition and requirements for a Nationally Recognized
    Testing Laboratory. The fundamentals of this program could offer
    assurance that consumer electrical products in the United States will
    provide a significant amount of safety to persons and property.
        The American Council on Electrical Safety (ACES) is an organization
    of individuals, organizations and Government officials responsible of
    assuring the safety of electrical products in the United States. Our
    members include accredited certification and testing laboratories that
    test all types of electrical products to assure they comply with U.S.
    safety standards. Additional members include inspectors and authorities
    having jurisdiction. Once a product is determined to comply with an
    applicable standard it is critical that we assure that the product
    continues to comply. This is done by regular follow up visits at the
    factory and market surveillance in the various distribution outlets.
        All of the test laboratories are accredited by the Department of
    Labor (OSHA) under the Nationally Recognized Testing Laboratory (NRTL)
    program.
        Although the OSHA-NRTL program is an excellent and effective
    program, authority is only granted for workplace products. Consumer
    products are excluded. Under the proposed bill for the CPSC to
    establish testing laboratories, much of what they do will duplicate
    what already exists in the U.S. However the most important ingredient
    of assuring continuous safety is market surveillance and factory follow
    up visits. This is the only way to assure that products continue to
    comply. Under the system presently in place there are over 10,000
    electrical inspectors; full time to assure that U.S. safety standards
    on work place electrical products, is continually assured.
        The use of the existing inspection agencies, accredited testing
    laboratories and certification bodies will greatly improve the success
    of the Act you are proposing.
                                     ______

      Press Release of Consumers Union--Nonprofit Publisher of
                                               Consumer Reports
                       For Immediate Release, Thursday, October 4, 2007
    Consumers Union Urges Reforms for CPSC; Supports Provisions in ``The
            Consumer Product Safety Reform Act of 2007''
        Washington, D.C.--Consumers Union, nonprofit publisher of Consumer
    Reports magazine, commended the Senate Commerce Subcommittee for
    Consumer Affairs, Insurance, and Automotive Safety for holding a
    hearing on comprehensive legislation to strengthen the Consumer Product
    Safety Commission.
        According to CU, this legislation, S. 2045, recently introduced by
    Subcommittee Chairman, Mark Pryor, and cosponsored by Senators Durbin,
    Klobuchar, Inouye and Nelson, takes important steps in correcting the
    current shortcomings of the CPSC and recognizes the need for
    fundamental reform of the agency.
        In a letter to the Subcommittee, CU outlined their support for the
    bill. Janell Duncan, Senior Counsel for CU noted that, ``The bill puts
    in place important protections for consumers against unsafe and
    dangerous products.''
        ``The recent onslaught of unsafe products imported into the United
    States has brought into focus the challenges faced by the Consumer
    Product Safety Commission. These events have clearly illustrated that
    the Commission lacks the staff, resources and legal authority to keep
    unsafe products out of the marketplace,'' co-wrote Donald Mays, Senior
    Director of Product Safety Planning and Technical Administration for
    CU.
        Some of the provisions CU praised include those providing for more
    tools and resources for the CPSC, creating a third-party certification
    of children's products to ensure that products comply with safety
    standard or Commission rules (CU urged this be extended to all
    products), and a ban on children's products containing more than
    ``trace amounts'' of lead.
        A copy of the letter follows:
                                                Consumers Union
                                                        October 3, 2007
    Dear Chairman Pryor:

        Consumers Union (CU), publisher of Consumer Reports commends you
    for your introduction of ``The CPSC Reform Act of 2007'' (S. 2045).
    This legislation is designed to strengthen the power and authority of
    the Consumer Product Safety Commission, a critically important Federal
    agency charged with ensuring the safety of over 15,000 products.
        The recent onslaught of unsafe products imported into the United
    States has brought into focus the challenges faced by the CPSC. These
    events have clearly illustrated that the Commission lacks the staff,
    resources and legal authority to keep unsafe products out of the
    marketplace. Although U.S. imports from foreign countries have doubled
    in the past year, the CPSC budget for Fiscal Year 2007 culminates a
    two-year reduction of full-time employees from 471 to 420. In 2008, the
    number of full-time employees is expected to reach a low of 401. This
    agency--starved for resources--has been unable to do its job. Your
    legislation would reduce this trend, by authorizing the appropriation
    of an infusion of funds to the Commission, beginning with a budget of
    $80,000,000 in FY 2008 and increasing yearly to a level of $141,725,000
    in FY 2015.
        As shown by recent violations of U.S. product safety laws, and
    repeated violations by some well-known companies, large manufacturers
    and retailers may look at penalties as simply a cost of doing business.
    Current civil penalties for companies that fail to comply are
    inadequate to serve as an effective deterrent. Your legislation would
    increase civil penalty caps for certain individual violations to
    $250,000, and raise the maximum civil penalty to $100,000,000. Although
    we believe the cap should be eliminated to provide maximum deterrence,
    this increase should cause companies, large and small alike, to think
    twice before selling unreasonably dangerous products, or failing to
    report possible product risks to the CPSC.
        Transparency is very important when products are suspected of
    posing unreasonable risks of harm. We therefore strongly support the
    provisions of this legislation that would eliminate Section 6(b) of the
    Consumer Product Safety Act (CPSA) that has served as a serious barrier
    to the release and timely disclosure of information that could warn the
    public about safety concerns relating to products.
        Parents and caregivers alike have been very concerned with the
    repeated recalls of dangerous children's products and toys due to
    product defects or excessive amounts of lead in the paint, We commend
    you for specific provisions of the legislation that would address
    hazards relating to toys, including:

       Third-party certification of children's products to ensure
            that products comply with safety standards or Commission rules
            (we strongly support this measure, and encourage you to expand
            this requirement to all products, especially all-terrain
            vehicles and gasoline powered outdoor equipment);

       Tracking labels for children's products to enable easier
            identification of products subject to a recall; and

       A ban on children's products containing more than ``trace
            amounts'' of lead, which S. 2045 would define as limiting
            amounts in children's jewelry to 0.02 percent, and amounts in
            other children's products to 0.04 percent. The American Academy
            of Pediatrics has stated that there is no safe level for which
            a child can be exposed to lead, and recently has called for
            limiting amounts in products intended for use by children under
            12 to 0.004 percent. We also agree that current limits are too
            high, and believe that Federal regulations should be changed to
            reduce the allowable limit for all consumer products to the
            lowest possible threshold.

        Other important consumer protection provisions include:

       Requiring importers to pay a bond to ensure that they have
            the financial ability to conduct a recall, if necessary;

       Strengthening CPSC recall authority, and powers under
            Section 15 of the CPSA to better ensure that product recalls
            are appropriate in scope and effectiveness;

       Authorizing the CPSC to refer repeat offenders to U.S.
            Customs for possible termination of their import license;

       Authorizing enforcement of the CPSA by State Attorneys
            General;

       Whistleblower protection for employees of manufacturers;

       Clarifying that, after the date of enactment, product safety
            rules promulgated by the CPSC will not preempt state or local
            laws to any greater extent than already permitted under Section
            26 of the CPSA. This provision also makes clear that the recent
            attempts by the Commission to cause the Mattress Flammability
            Rules to preempt state law will not do so in ways beyond what
            is allowed under Sections 26(a) and (c) of the CPSA.

        Once again, we thank you for crafting this important bill, designed
    to put into place important protections for consumers against unsafe
    and dangerous products. We appreciate your efforts to restore both
    resources and authority to the CPSC to enable it to better serve the
    public interest. We look forward to working with you on this measure as
    it moves through the legislative process.
                Sincerely,

                                            Janell Mayo Duncan,
                                                        Senior Counsel,
                                                           Washington, D.C.

                                                      Don Mays,
                                      enior Director of Product Safety,
                  Planning and Technical Administration, Yonkers, New York.
    cc: Members of the Senate Commerce Subcommittee on Consumer Affairs
                                     ______

                                           Friends of the Earth
                                       Washington, DC, October 23, 2007
        On behalf of Friends of the Earth, MOMS (Making Our Milk Safe),
    Sierra Club, Clean Water Action, Environmental Working Group,
    Firefighters Burn Institute, Trauma Foundation, San Francisco
    Firefighters Cancer Prevention Foundation, Institute for Agriculture
    and Trade Policy, Citizens' Environmental Coalition, Indiana Toxics
    Action, Kentucky Environmental Foundation, California Communities
    Against Toxics, Clean New York, Global Community Monitor, Vermont PIRG,
    CA Product Stewardship Council, Blue Voice

    Hon. Daniel K. Inouye,
    U.S. Senate,
    Hart Senate Office Building,
    Washington, DC.

    Re: Senate Bill 2045: The Consumer Product Safety Commission Reform
                                                            Act of 2007

    Dear Senator Inouye,

        Thank you for your excellent work on Senate Bill 2045, the Consumer
    Product Safety Commission Reform Act of 2007, which is an important
    piece of legislation for reducing the very real threats of lead
    contamination in children.
        However, we, the undersigned, are writing to request that Section
    25 be deleted from the bill. This provision mandates the Consumer
    Product Safety Commission (CPSC) to issue a final rule for furniture
    flammability by June 1, 2008, which could result in exposing the
    American people and the environment to potentially dangerous toxic fire
    retardant chemicals. We strongly urge you to delete this section for
    reasons outlined in more detail below.
        1. Based upon historical experience in the State of California, we
    believe that flame retardant chemicals would be used to meet CPSC's
    proposed standards. Unfortunately, in hundreds of peer-reviewed
    scientific studies, a sample list of which we have provided with this
    letter, flame retardants used in furniture have been found to persist,
    accumulate and be potentially toxic. Fire retardant chemicals are
    accumulating in humans, wildlife, and the environment at alarming
    rates. U.S. women have some of the highest levels of fire retardants in
    their breast milk in the world. The Polyurethane Foam Association,
    which produces the foam for the Nation's furniture manufacturers,
    estimates that 17 to 70 million additional pounds of these chemicals
    would be used annually to meet CPSC's current draft standard.
        2. Adequate toxicity testing has not been conducted on the serious
    health impacts of these flame retardant chemicals. Health impacts
    include the potential for bioaccumulation and persistence, especially
    in children, as well as endocrine disruption, carcinogenicity, and
    reproductive and neurological toxicity. Recent U.S. EPA studies
    indicate areas of concern, as well as large data gaps for human health
    and environmental safety for all of the fire retardant chemicals
    currently used in furniture.
        3. Dozens of scientific studies are now underway examining the
    relationship between previously used PBDE fire retardant chemicals and
    birth defects, autism, hyperactivity, reduced fertility including
    lowered sperm counts, and other reproductive and neurological
    conditions. This August, a study conducted by U.S. EPA scientists
    linked fire retardant chemicals to the current epidemic of hyperthyroid
    disease in domestic cats. Further studies will not be completed within
    the timeline of this legislation.
        4. Studies have not been conducted on the fate and transport of
    fire retardant chemicals used in furniture. Alarmingly, some fire
    retardants such as PBDEs and PCBs have been found in extremely remote
    areas including the Arctic Circle, with the highest levels found in
    Killer Whales, The entire lifecycle of products containing fire
    retardant chemicals must be considered including occupational exposure
    during manufacture, chemical exposure during use, and end of life
    disposal problems when products are combusted, land-filled, composted,
    littered, or recycled.
        5. Even though California is the only state in the country with
    furniture flammability standards (California Technical Bulletin 117),
    leading to the use of millions of pounds of chemical fire retardants,
    California has failed to achieve greater fire safety than other states.
    According to a study by the National Fire Protection Association, the
    rate of reduction of fire deaths in California over the last 20 years
    is statistically identical to other states that do not have furniture
    flammability standards. A general decrease in smoking, the increased
    use of sprinkler systems and smoke alarms, fire-safe cigarettes, and
    improved building codes have had a significant impact on increasing
    fire safety across the U.S.
        6. A dangerous fire retardant known as chlorinated tris, or TDCP,
    which was removed from children's sleepwear 30 years ago by CPSC, is
    the second most common fire retardant used in California furniture
    today. Tris is both a mutagen and a probable human carcinogen. CPSC
    studies predict that 300 cases of cancer per million are likely due to
    current human exposure to this chemical in furniture. If tris were used
    more broadly across the Nation as a result of new fire retardant
    standards, CPSC projects an additional 1,200 cases of cancer annually.
        7. When furniture treated with fire retardant chemicals burns,
    dioxins and furans--some of the most carcinogenic chemicals known--are
    produced. According to a recent study by the Journal of Occupational
    and Environmental Medicine, firefighters have significantly elevated
    rates of four types of cancer: multiple myeloma, non-Hodgkin's
    lymphoma, prostate, and testicular cancer. Experts believe that these
    cancers may be related to firefighters' exposure to the toxic by-
    products created when furniture treated with fire retardant chemicals
    burn. Primarily for this reason, The International Association of
    Firefighters, which represents hundreds of thousands of firefighters
    nationwide, supports efforts to phase-out the use of toxic and unsafe
    fire retardants.
        8. California is currently considering legislation in the Senate
    mandating the phase-out of the most toxic fire retardant chemicals (AB
    706). A new study finds private residences in California have three to
    ten times higher levels of fire retardant chemicals than homes
    elsewhere in the U.S. For this and other reasons, AB 706 has the strong
    support of national environmental and public health organizations, burn
    institutes, organized labor organizations, as well as the largest
    firefighter organizations in California.
        9. A Federal flammability standard set by CPSC may lead to a pre-
    emption of state laws to phase-out toxic fire retardants. Eleven U.S.
    states have already banned pentaBDE and octaBDE, and two states have
    banned decaBDE. If CPSC establishes a national furniture standard which
    in practice leads to the use of chemicals which have been banned by any
    state, this will likely lead to litigation between states and the
    Federal Government.
        10. Early estimates from New York State suggest that fire-safe
    cigarettes will cause a 50 to 67 percent reduction in fire deaths.
    Public health officials acknowledge that this is a much safer and more
    effective means of reducing fire hazard. Laws in 22 U.S. states and
    Canada currently require cigarettes to be constructed so that they will
    self-extinguish if left unattended. Other states are actively
    considering such regulations. Compared to adding chemicals to foam,
    which has not resulted in a measurable decline in fire deaths in
    California over 20 years, fire safe cigarettes will appreciably reduce
    fire hazard without dangerously adverse public health and environmental
    impacts.
        We urge you to strike Section 25 and to allow California,
    Washington, Maine, New York and other states to take the lead on
    efforts to limit the use of the most dangerous fire retardants.
        We applaud your efforts to improve fire safety, but it must not
    come at the expense of increasing human and environmental exposure to
    potentially toxic chemicals for which there is inadequate health and
    safety information.
                Thank you,

    Brent Blackwelder, Ph.D.             Mary Brune
    President                            Executive Director
    Friends of the Earth                 MOMS (Making Our Milk Safe)

    Ed Hopkins                           Carol Misseldine
    Director of Environmental Quality    Executive Director
    Sierra Club                          California Product Stewardship
                                          Council

    Patty Neifer                         Charity Carbine
    Executive Director                   Environmental Health Advocate
    Firefighters Burn Institute          Vermont PIRG

    Marie Zellar                         Hardy Jones
    Midwest Regional Director            Executive Director
    Clean Water Action                   Blue Voice

    Andrew McGuire                       Jane Williams
    Executive Director                   Executive Director
    Trauma Foundation                    California Communities Against
                                          Toxics

    Tony Stefani                         Denny Larson
    Chairman of the Board                Executive Director
    San Francisco Firefighters Cancer    Global Community Monitor
    Prevention Foundation

    Richard Wiles                        Bobbi Chase Wilding
    Executive Director                   Associate Director
    Environmental Working Group          Clean New York

    Steve Breyman, Ph.D.                 Kathleen Schuler, M.P.H.
    Executive Director                   Senior Policy Analyst
    Citizens' Environmental Coalition    Institute for Agriculture and Trade
                                          Policy

    Lin Kaatz Chary, Ph.D, M.P.H.        Elizabeth Crowe
    Indiana Toxics Action                Program Director
                                         Kentucky Environmental Foundation

                                     ______

            Prepared Statement of the American Academy of Pediatrics
        The American Academy of Pediatrics (AAP), a nonprofit professional
    organization of 60,000 primary care pediatricians, pediatric medical
    sub-specialists, and pediatric surgical specialists dedicated to the
    health, safety, and well-being of infants, children, adolescents, and
    young adults, appreciates this opportunity to submit testimony for the
    record of the October 4 hearing on S. 2045, the CPSC Reform Act of
    2007.
        The American Academy of Pediatrics commends the sponsors of S. 2045
    for this effort to pay long-overdue attention to the Consumer Product
    Safety Commission (CPSC), its authorities, and the marketplace in which
    it operates. The AAP supports initiatives to increase the CPSC's staff
    and funding, give it more tools to police the consumer marketplace, and
    require manufacturers and sellers of consumer products to pursue safety
    more zealously.
        The AAP would like to offer testimony directed to the portions of
    S. 2045 dealing with children's products and regulation of lead. In
    particular, the AAP applauds S. 2045 for reducing the lead standard for
    paint to 90 parts per million (ppm). The AAP recommends that S. 2045 be
    improved as follows:

       Lead should be banned in children's products above the level
            of 40 ppm. Further, no compelling rationale exists for
            differentiating toy jewelry from other types of children's
            products.

       Children's product should be defined as those intended for
            use by or with children age 12 and under.

       Legislation or regulations should limit the overall lead
            content of an item, rather than only limiting lead content of
            its components. A single product may contain numerous
            components that could cumulatively contain a dangerous level of
            lead.
    Lead is Ubiquitous in Our Environment
        Lead is a soft, heavy and malleable metal that occurs naturally in
    trace amounts throughout the environment. Due to its abundance and easy
    workability, it has been used for thousands of years in plumbing,
    production of glass and crystal, and manufacture of ammunition.\1\ Its
    toxicity was recognized by the Romans \2\ and documented during the
    twentieth century, as its increasingly widespread use led to
    unprecedented levels of occupational and environmental lead
    poisoning.\3\ By 1970, science had demonstrated conclusively that lead
    could cause both acute poisoning as well as a wide range of long-term
    human health consequences.\3\ \4\ Since then, hundreds of studies have
    shown that the body has no use for lead, and that a ``normal'' blood
    lead level is zero.
        Because of its widespread use, lead has been concentrated in the
    environment where it poses a serious threat to children's health.
    Furthermore, because it cannot be identified easily, even when present
    in high amounts in paint, dust, or dirt, children can be exposed in
    their homes and schools and at play without our knowledge. It is an
    ``invisible'' poison.
    Low Levels of Lead Can Cause Serious Effects
        Damage done by small amounts of lead may be hard to measure and
    even harder to understand. Most children who accumulate lead in their
    body do not have any physical symptoms, but low lead levels cause a
    wide array of negative effects, including cognitive, motor, behavioral,
    and physical harm.\5\
        There is no ``safe'' level of lead exposure. The developing embryo,
    fetus, and child grow and change rapidly. If, during this period of
    change, the fetus or child is exposed to a poison of some kind,
    development can be impacted negatively. These ``critical windows of
    exposure'' are specific periods of development during which the embryo
    or fetus is undergoing some process (such as the development of arms
    and legs between days 22 and 36 of pregnancy, when thalidomide damages
    their development.\6\ \7\) There are many other examples of this
    effect, including tobacco smoke and behavioral effects, and alcohol and
    fetal alcohol syndrome. The critical period associated with harm from
    lead poisoning is brain and nervous system development, which begins in
    early pregnancy and continues until at least age 3 years.\8\
        The vulnerability of children to lead poisoning during development
    of their brain and nervous system has been amply demonstrated, and the
    literature is very consistent. On average, children whose blood lead
    levels (BLLs) rise from 10 to 20 mcg/dL lose two to three IQ points.
    More recent studies have shown an even greater impact on IQ of BLLs
    under 10 mcg/dL. Key studies reported a loss of 4 to 7 IQ points in
    children whose lead levels rose from 1 mcg/dL to 10 mcg/dL.\9\ \10\
    These studies suggest that ``low'' levels of exposure--meaning BLLs
    less than 10 mcg/dL--cause proportionately greater harm than higher
    levels. The effects of lead on health do not stop once the child
    reaches age 6 years. A recent study found that in a group of 7-year old
    children exposed to lead before the age of 3 years, IQ was more closely
    related to blood lead at age 7 years than past blood lead at age 5 or
    peak blood lead at approximately age 2 years.\11\
        Another important lasting effect of lead exposure is on behavior,
    with higher rates of behavioral problems reported in teens and adults
    exposed to lead during childhood. Children with elevated lead are more
    likely to have problems with attention deficit, reading disabilities,
    and to fail to graduate from high school.\12\ Investigators have
    identified associations between lead exposure and increased aggression,
    commission of crime and antisocial or delinquent
    behaviors.\13\-\16\ Studies have suggested that several
    nations which began reducing lead exposure aggressively in the 1970s
    experienced corresponding decreases in crime rates two to three decades
    later.\16\ Other effects include abnormal balance, poor eye-hand
    coordination, longer reaction times, and sleep disturbances.\12\ \17\
    \18\
        The loss of a few IQ points or a small increase in the proportion
    of children with behavioral problems in the population of U.S. children
    has marked impacts on educational needs and future potential.\19\ Since
    lead exposure is a population-wide risk, even relatively low levels of
    exposure can affect large numbers of children. This means that more
    children need special education, there are fewer gifted children, and
    over time, the average IQ of the entire population falls.\19\
    Lead Poses a Serious Health Hazard to Children At Every Level of
            Exposure and Every Stage of Development
        Lead is easily absorbed by ingestion or inhalation. The most common
    route of exposure of children is through ingestion, usually by putting
    hands and other objects in their mouth. Both hand-to-mouth exploration
    and playing on floors are typical behaviors for children, especially
    younger children. Studies using videos to record oral behaviors of
    young children report hand or object in mouth activities 20 or more
    times per hour.\20\ \21\ If the dirt on their hands or the dust on the
    floor contains lead, every one of those activities delivers a dose of
    lead.
        Another significant difference between children and adults is in
    the rate of their metabolisms. Children have significantly faster
    metabolisms, which means that they breathe faster and ingest
    proportionately more food and water.\22\ This difference means that in
    similar environments, children are exposed to a greater extent to
    contaminants than adults. Since children absorb 5 to 50 percent of any
    lead they ingest (compared to adults, who absorb 10-15 percent),\23\
    they are at high risk of lead poisoning every time they are exposed.
        Once lead enters the body it remains there for years. Lead is
    similar to calcium from the elemental perspective. This means that our
    bodies ``see'' lead as calcium, absorb it into blood and then store it
    in bone. These stores of lead can be released years later, when bone
    changes occur or demands on calcium stores are made.\24\ Another
    consequence of storing lead in bone is that exposures separated by
    months or years have an additive effect on the body's burden of lead
    and can exert effects over decades. Acquisition of lead in the body
    even in small amounts (i.e., amounts that result in BLLs less than 10
    mcg/dL) contribute to this accumulation of lead. This means that
    commonly encountered blood lead concentrations have lasting negative
    effects.
        Another consequence of this accumulation of lead in bone is the
    exposure of the fetus to lead by the mothers. Women exposed to lead
    during childhood may have significant stores of lead in their bones. If
    they do not consume adequate calcium during pregnancy, their bones
    release calcium as the fetus grows. As the calcium is released, lead is
    released as well, This lead can be transferred to the fetus--exposing
    the fetus' developing brain and nervous system at a critical time.
    Fetal exposure from this route has been demonstrated to cause
    measurable decreases in IQ.\25\
    Sources of Children's Exposure to Lead
        The most common source of lead exposure today is lead paint, found
    in older housing stock. As paint wears off, it contaminates the dust
    that clings to surfaces, toys and the fingers of children. Other
    sources of lead exposure include contaminated soil, traditional or folk
    medicines, and certain types of dishes. In recent years, however,
    parents have found a new source of anxiety regarding lead exposure:
    children's toys and other products, particularly those imported from
    China.
        These concerns are justified. Since July 2006, the CPSC has issued
    at least 11 recalls affecting more than 6.7 million units of children's
    toy jewelry due to excessive lead content. Since 1998, CPSC has issued
    at least 29 recalls involving 157,962,000 pieces of toy jewelry due to
    high lead levels. Other products recalled during that time due to lead
    contamination include game pieces, candles, sidewalk chalk, and art
    kits. Consumers are acutely aware of recent recalls of popular toys
    found to contain lead paint, including Thomas the Tank Engine, Mattel's
    Barbie, and Fisher-Price's Dora the Explorer toys. The risk of harm to
    children from these toys is real: in 2006, a 4-year-old Minnesota boy
    died after ingesting a small Reebok shoe charm that was later found to
    be 99.1 percent lead.\26\ The charm he ingested dissolved in his
    stomach, releasing the lead into his bloodstream.
    Lead Must Be Removed from Toys and Other Children's Products
        The American Academy of Pediatrics has consistently urged the
    Consumer Product Safety Commission (CPSC), the Environmental Protection
    Agency (EPA), and other agencies to take aggressive, proactive steps to
    minimize children's exposure to lead. The addition of lead to jewelry
    or toys is not in any way central or even necessary to the function or
    purpose of the product. For example, manufacturers add lead to jewelry
    to give it more weight or heft, rather than using a more expensive but
    safer metal. None of these factors represent a compelling rationale for
    including a poisonous substance in a product specifically designed for
    use by children.
        The range of products covered by a ban on lead content must also be
    considered carefully. ``Children's product'' must be defined broadly
    enough to cover the full range of items capable of causing a serious
    hazards--not just toys or ``toy'' jewelry but also durable products
    such as furniture (cribs, strollers, high chairs, etc.) and products
    meant for the care of children (bath seats, gates, etc.). One of the
    first pediatric deaths attributed to lead paint was a child who chewed
    on the railing of his crib--in 1913.\4\
        Finally, legislation should cover products meant or designed for
    use by or with children at least up through the age of 12. Children are
    susceptible to neurological damage from lead exposure throughout the
    development of their brain and nervous system. Their long ``shelf
    life,'' or the period of time over which they can be exposed to and
    accumulate lead in their bodies, means that every exposure should be
    eliminated or minimized to prevent future harms. Finally, toys meant
    for older children often find their way into the hands of younger
    siblings and other small children, posing a hazard to these children
    outside the object's target audience.
    Federal Lead Standards
        Federal agencies use a variety of standards for unacceptable lead
    content. This issue is complicated by the fact that lead uptake varies
    depending upon the route of exposure (ingestion, inhalation, skin
    contact, etc.) In considering existing guidelines, it is critical to
    bear in mind that many were set before research demonstrated the
    harmful effects of lead at low levels. There is no known safe level of
    lead exposure; as a result, exposure to lead below these levels should
    not be considered ``safe.''

       In 1978, the Consumer Product Safety Commission banned the
            manufacture of paint containing more than 0.06 percent lead by
            weight on interior and exterior residential surfaces, toys, and
            furniture.

       Based on that standard for lead paint, the CPSC's current
            voluntary standard prohibits toy jewelry to contain more than
            0.06 percent lead by weight. The standard further requires
            manufacturers to test for the ``accessibility'' of lead,
            although surface accessibility may be irrelevant if an item is
            small enough to be ingested.

       The EPA requires water provided by public utilities to
            contain no more than 15 parts per billion of lead. The 1986
            Safe Drinking Water Act Amendments banned the use of lead in
            public drinking water distribution systems and limited the lead
            content of brass used for plumbing to 8 percent.

       The EPA set guidelines for lead contamination of dust,
            limiting levels called ``safe'' to below 40 mcg/ft\2\ for
            floors.\27\ It is important to note that this is not a health-
            based standard; an estimated 20 percent of children exposed to
            floor dust lead levels at 40 mcg/ft\2\ will have a blood lead
            level above 10 mcg/dL.\28\

       In response to reports of lead contamination in candies
            likely to be consumed frequently by small children, the Food
            and Drug Administration (FDA) set a maximum lead level of 0.1
            ppm. FDA has set different levels for other products; for
            example, dairy product solids may contain lead at no more than
            0.5 ppm.\29\

       The FDA recommends a limit on children's lead intake in food
            to no more than 6 mcg/day. It is important to note that this is
            not a health-based standard; this limit is roughly equivalent
            to the amount of lead that would be expected to lower IQ by 1
            point.

       FDA regulates lead content in cosmetics; for example, the
            colorant manganese violet may contain lead at no more than 20
            ppm.\30\

       Airborne lead is regulated by EPA as a ``criteria
            pollutant'' under the Clean Air Act. The National Ambient Air
            Quality Standard for lead is 1.5 mcg/m\3\, maximum arithmetic
            mean averaged over a calendar quarter.

       Both the National Institute for Occupational Safety and
            Health and the Occupational Safety and Health Administration
            set permissible limits for lead exposure in the workplace, but
            these guidelines are designed for adults and not appropriate
            for children.
    Recommendations
        To protect the health of our Nation's children, the CPSC must be
    given the tools it needs to fulfill its mission. In particular,
    nonessential uses of lead, especially in products to which children may
    be exposed, must be prohibited. The American Academy of Pediatrics
    recommends the following:

       The CPSC should require all products intended for use by or
            in connection with children to contain no more than trace
            amounts of lead.

       The Academy recommends defining a ``trace'' amount of lead
            as no more than 40 ppm, which is the upper range of lead in
            uncontaminated soil.\31\ This standard would recognize that
            contamination with minute amounts of lead in the environment
            may occur but can be minimized through good manufacturing
            practices.

       ``Children's product'' should be defined in such a way as to
            ensure it will cover the wide range of products used by or for
            children. This standard should cover toys intended for use by
            or with children under the age of 12 years.

       The limit on lead content must apply to all components of
            the item or jewelry or other small parts that could be
            swallowed, not just the surface covering.

       Legislation or regulations should limit the overall lead
            content of an item, rather than only limiting lead content of
            its components. A single product may contain numerous
            components that could cumulatively contain a dangerous level of
            lead.

       The CPSC must be funded adequately. The President requested
            a budget of $63.2 million for CPSC in Fiscal Year 2008, which
            would require the agency to cut an additional 19 employees.
            This budget is insufficient to even allow the agency to
            continue current programs, much less expand its efforts. At its
            founding, the CPSC budget was $39 million. If the budget had
            kept pace with inflation, it would be $138.2 million today,
            more than double its requested allocation.

       An appropriately qualified CPSC chair must be nominated and
            approved in a timely fashion. The CPSC has been without a
            voting quorum of Commissioners since January 2007, meaning it
            cannot take many regulatory, enforcement and other actions. The
            President's recent nominee to chair the Commission withdrew
            from consideration after a public outcry regarding his
            qualifications.

       The authority of the agency to issue mandatory recalls and
            provide full information to consumers must be strengthened.

        Finally, it is important to note that, while limiting lead is an
    important aspect of guaranteeing the safety of children's products,
    numerous other aspects of this issue should also be considered. Other
    key children's product safety issues including choking hazards,
    flammability, dangerous magnets, and safe product design.
    Conclusion
        There is no known ``safe'' level of lead for children.\32\ \33\ No
    study has determined a blood lead level that does not impair child
    cognition. Since any measurable lead level causes lasting harm,
    prevention of exposure is the only treatment.\34\ Lead exposure is an
    important, unnecessary, and preventable poisoning.
        The American Academy of Pediatrics appreciates this opportunity to
    submit testimony for the record of this hearing on S. 2045, the CPSC
    Reform Act of 2007. If the AAP may be of further assistance, please
    contact Cindy Pellegrini in our Washington, D.C. office.
    References
        \1\ Chemistry: WebElements Periodic Table. http://
    www.webelements.com/webelements/elements/text/Pb/key.html. Accessed
    March 31, 2004.
        \2\ Lead Poisoning and Rome. http://itsa.ucsf.edu/snlrc/
    encyclopaedia_romana/wine/leadpoisoning.html. Accessed March 31, 2004.
        \3\  Markowitz G., Rosner D. ``Cater to the children'': the role of
    the lead industry in a public health tragedy, 1900-1955. Am J Public
    Health. 2000;90(1):36-46.
        \4\ Warren C. Brush With Death: A Social History of Lead Poisoning.
    Baltimore, MD: Johns Hopkins University Press; 2000.
        \5\ Bellinger D. Lead. Pediatrics. 2004;113 (4 (Supplement)):1016-
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        \6\ Brent R. Environmental causes of human congenital
    malformations: the pediatrician's role in dealing with these complex
    clinical problems caused by a multiplicity of environmental and genetic
    factors. Pediatrics. 2004;113 (4 (Supplement)):957-968.
        \7\ Sadler T.W. Langman's Medical Embryology. 6th ed. Baltimore,
    MD: Williams & Wilkins; 1990.
        \8\ Mendola P., Selevan S.G., Gutter S., Rice D. Environmental
    factors associated with a spectrum of neurodevelopmental deficits. Ment
    Retard Dev Disabil Res Rev. 2002;8(3):188-197.
        \9\ Canfield R.L., Henderson C.R., Jr., Cory-Slechta D.A., Cox C.,
    Jusko T.A., Lanphear B.P.. Intellectual impairment in children with
    blood lead concentrations below 10 microg per deciliter. N Engl J Med.
    2003;348(16):1517-1526.
        \10\ Lanphear B.P., Hornung R., Khoury J., et al. Low-level
    environmental lead exposure and children's intellectual function: an
    international pooled analysis. Environ Health Perspect. Jul.
    2005;113(7):894-899.
        \11\ Chen A., Dietrich K.N., Ware J.H., Radcliffe J., Rogan W.I. IQ
    and blood lead from 2 to 7 years of age: are the effects in older
    children the residual of high blood lead concentrations in 2-year-olds?
    Environ Health Perspect. 2005;113(5):597-601.
        \12\ Centers for Disease Control and Prevention. Managing Elevated
    Blood Lead Levels Among Young Children: Recommendations from the
    Advisory Committee on Childhood Lead Poisoning Prevention. Atlanta, GA:
    Centers for Disease Control and Prevention.; 2002.
        \13\ Dietrich K.N., Ris M.D., Succop P.A., Berger O.G., Bornschein
    R.L.. Early exposure to lead and juvenile delinquency. Neurotoxicol
    Teratol. Nov-Dec 2001;23(6):511-518.
        \14\ Ris M.D., Dietrich K.N., Succop P.A., Berger O.G., Bornschein
    R.L. Early exposure to lead and neuropsychological outcome in
    adolescence. J Int Neuropsychol Soc. Feb. 2004:261-270.
        \15\ Burns J.M., Baghurst P.A., Sawyer M.G., McMichael A.J., Tong
    S.L. Lifetime low-level exposure to environmental lead and children's
    emotional and behavioral development at ages 11-13 years. The Port
    Pirie Cohort Study. Am J Epidemiol. Apr. 15 1999;149(8):740-749.
        \16\ Nevin R. Understanding international crime trends: the legacy
    of preschool lead exposure. Environ Res. 2007;104(3):315-336.
        \17\ Bhattacharya A., Shukla R., Dietrich K.N., Bornschein R.L.
    Effect of early lead exposure on the maturation of children's postural
    balance: a longitudinal study. Neurotoxicol Teratol. 2006;28(3):376-
    385.
        \18\ Chiodo L.M., Covington C., Sokol R.J., et al., Blood lead
    levels and specific attention effects in young children. Neurotoxicol
    Teratol. Apr. 21 2007.
        \19\ Bellinger D.C. What is an adverse effect? A possible
    resolution of clinical and epidemiological perspectives on
    neurobehavioral toxicity. Environ Res. 2004;95(3):394-405.
        \20\ Reed K.J., Jimenez M., Freeman N.C., Lioy Quantification of
    children's hand and mouthing activities through a videotaping
    methodology. J Expo Anal Environ Epidemiol. 1999:9(5):513-520.
        \21\ Ko S., Schaefer P.D., Vicario C.M., Binns H.J. Relationships
    of video assessments of touching and mouthing behaviors during outdoor
    play in urban residential yards to parental perceptions of child
    behaviors and blood lead levels. J Expo Sci Environ Epidemiol.
    2007:17(1):47-57.
        \22\ Plunkett L.M. T.D., Rodrieks J.V. Differences between adults
    and children affecting exposure assessment. In: Guzelian P.S. H.C.,
    Olin SS, ed. Similarities and Differences Between Children and Adults:
    Implications for Risk Assessment. Washington, D.C.: ILSI Press;
    1992:79-94.
        \23\ United States Environmental Protection Agency. Review of the
    National Ambient Air Quality Standards for Lead: Exposure Analysis
    Methodology and Validation. Washington, D.C.: Air Quality Management
    Division, Office of Air Quality Planning and Standards, U.S.
    Environmental Protection Agency: 1989.
        \24\ O'Flaherty E.J.. A physiologically based kinetic model for
    lead in children and adults. Environ Health Perspect. 1998;106 Suppl.
    6:1495-1503.
        \25\ Schnaas L., Rothenberg S.J., Flores M.F., et al., Reduced
    intellectual development in children with prenatal lead exposure.
    Environ Health Perspect. 2006; 114(5):791-797.
        \26\ Centers for Disease Control and Prevention. Death of a child
    after ingestion of a metallic charm--Minnesota. 2006. MMWR.
    2006;55(12):340-341.
        \27\ Federal Register. Part III, Environmental Protection Agency.
    Lead: Identification of Dangerous Levels of Lead: Final Rule.
    2001;66:1206-1240.
        \28\ Lanphear B.P., Weitzman M., Winter N.L., et al. Lead-
    contaminated house dust and urban children's blood lead levels. Am J
    Public Health. 1996;86(10):1416-1421.
        \29\ Food and Drug Administration. GRAS affirmation petition GRP
    1G0371. http://www.cfsan.fda.gov/rdb/opa-g037.html.
        \30\ U.S. Food and Drug Administration. 21 CFR 73.2775. http://
    www.accessdata.fda.gov/scripts/cdrh/cfdocs/cfefr/
    CFRSearch.cfm?fr=73.2775.
        \31\ Friedland A., Johnson A. Lead distribution and fluxes in a
    high-elevation forest in northern Vermont. J Environ. Qual.
    1985:14:332-336.
        \32\ American Academy of Pediatrics Committee on Environmental
    Health. Lead exposure in children: prevention, detection, and
    management. Pediatrics. 2005:116(4):1036-1046.
        \33\ Centers for Disease Control and Prevention. Preventing Lead
    Poisoning in Young Children. Atlanta: CDC: 2005.
        \34\ Centers for Disease Control and Prevention. Preventing Lead
    Exposure in Young Children: A Housing-Based Approach to Primary
    Prevention of Lead Poisoning. Atlanta: CDC; 2004.
                                     ______

         Prepared Statement of Charles Jeffrey Duke, General Counsel,
                          Zippo Manufacturing Company
        Chairman Pryor, Ranking Member Sununu, and other distinguished
    Subcommittee Members. My name is Charles Jeffrey Duke, General Counsel
    of Zippo Manufacturing Corporation. I want to thank you for giving me
    the opportunity to submit my views on the Consumer Product Safety
    Reform Act, S. 2045.
        In general, Zippo supports the reauthorization of the U.S. Consumer
    Product Safety Commission with substantially increased authorization
    and staff levels. I believe that S. 2045 embraces a healthy increase of
    both of these resources and I support those objectives. Zippo supports
    a number of the needed reforms in S. 2045; for example, providing the
    authority to expand the Commission to five Commissioners; streamlining
    the submission of documents and reports to Congress; streamlining
    rulemaking procedures; and providing a system for more accurate
    identification of manufacturers by importers, retailers and
    distributors.
        Zippo also supports expanding the list of certain prohibited acts--
    such as prohibiting the resale of recalled products; increasing
    penalties for repeat offenders; and increased penalties for
    misrepresenting information in investigations; and more efficient
    sharing of information with Federal, State, local and foreign law
    enforcement agencies.
        There are, however, other provisions in the bill that would impose
    unreasonable burdens on small and medium sized enterprises (SMEs) like
    Zippo. The elimination of section 6(b) of the Consumer Product Safety
    Act could expose Zippo and other SMEs to breaches of confidential and
    proprietary information. Zippo also is very concerned about Section 21
    of the bill that would authorize lawsuits by state attorneys general.
    This has the potential of exposing Zippo and other SME's to expensive
    and unnecessary litigation in a myriad of legal systems. SMEs are much
    less able to expend resources on litigation than multinationals are.
    Every dollar spent on litigation comes at the expense of spending to
    protect intellectual property, developing new and innovative products
    and continuing to employ Americans in good paying jobs with
    comprehensive employee benefits.
        Zippo is also concerned about Section 18 of the bill that would
    have the effect of narrowing Federal preemption. This tends to create
    confusion in the marketplace due to the absence of a clear national
    standard. In this era of globalization, when SMEs are being required to
    compete in dozens if not hundreds of countries, as Zippo does, just to
    survive, a clear national safety standard enforced federally, as
    compared to numerous state variations created by state enforcement, to
    provide the consistency both manufacturers and consumers need. Zippo
    would like to work with the Committee to improve this legislation
    making the provisions more fair and equitable for consumers and SMEs
    alike.
        I would like to point to one specific provision of the bill--
    section 25--that establishes a model for helping Zippo and other
    lighter companies, along with many other industries, to make a
    substantial contribution to safety. Section 25 requires the Commission
    to issue a final rule by no later than June 1, 2008 on a proposed rule
    on ``Ignition of Upholstered Furniture by Small Open Flame and/or
    Smoldering Cigarettes'' This proposed rule has been pending before the
    Commission for over 10 years without a successful outcome. It is time
    for the Commission to act on this proposed rule and the Congress is
    justified in encouraging the Commission to ensure action.
        Zippo urges the Committee to adopt language similar to Section 25
    to create a mandatory rule for the existing voluntary standard for
    cigarette lighters, ASTM F-400. For years, the Commission has been
    considering a pending rulemaking (Federal Register/Vol. 70, No. 68/
    Monday, April 11, 2005/Proposed Rules) to create a mandatory safety
    standard for cigarette lighters, yet it appears that the Commission is
    not prepared to act on this rulemaking, which is stuck at the ANPR
    stage. In the interim, one to two persons die each year due to faulty
    lighters entering the U.S. market.
        The history of this rulemaking is revealing of the Commission's
    inability to take action. In November 2001, the Lighter Association,
    Inc. petitioned the Commission to adopt a voluntary standard--ASTM F-
    400--as a mandatory standard under the Consumer Product Safety Act
    (CPSA). This voluntary standard meets the requirements to address the
    risk of death, and injury associated with the mechanical malfunction of
    lighters. Zippo believes that a mandatory rule is necessary to address
    an unreasonable risk of injury created by the widespread non-
    conformance of the voluntary standard by imported lighters.
        Nearly 3 years ago on November 30, 2004, the Commission voted to
    grant the petition and published an advanced notice of proposed
    rulemaking (ANPR) in the Federal Register on April 11, 2005. According
    to the CPSC staff, available market data indicates that imported and
    domestic lighter production totals approximately 1 billion units
    annually. Imports account for more than 75 percent of the U.S. market
    for lighters. China accounts for 58 percent of lighter imports--or 435
    million lighters imported into our country every year. Chinese
    compliance with the voluntary standard on tests conducted by the CPSC
    is less than 30 percent thus assuming these samples are indicative of
    the market, at least 304 million of all lighters imported into the
    United States from China annually are not in compliance with the
    voluntary lighter standards with which American manufacturers comply. A
    voluntary standard loses its value to the consuming public if millions
    of products are potentially non-conforming.
        According to the National Fire Incident Reporting System (NFIRS)
    for the period 1999-2002, there were an estimated 290 residential
    structure fires that appear to have been caused by malfunctioning
    lighters. According to CPSC data from the National Electronic Injury
    Surveillance System (NEISS) from 1997-2005, there were an estimated
    4,145 emergency department treated injuries resulting from
    malfunctioning lighters; mostly burns to the face, hands, and fingers.
    From 1997-2005, 362 incident reports related to lighter failures were
    received; 65 percent of these lighter failures resulted in fires,
    leading to 4 deaths and some serious injuries. The information in these
    reports showed that malfunctioning lighters mostly resulted in fire and
    explosion hazards. This updated incident data includes four deaths and
    additional serious injuries.
        In testimony before the Commission on September 14, 2004, Rohit
    Khanna, the Project Leader for the lighter rulemaking, testified that
    there were an estimated 2.2 deaths per billion lighters sold from
    malfunctioning lighters and an estimated 1.1 injuries per million
    lighters sold from malfunctioning lighters. With the billion lighters
    sold each year, this equates to about 2 deaths each year and about
    1,000 injuries each year.
        Once the ANPR was voted out, the CPSC staff conducted a study to
    estimate the level of conformance of lighters to ASTM F-400 and
    revealed that inexpensive and disposable lighters had conformance rates
    at or below 40 percent (approximately 91 percent of all lighters in the
    market are disposable and 9 percent are refillable). Among countries,
    lighters from China had the lowest conformance rate at less than 30
    percent. This is consistent with testing conducted by BIC Corporation
    in 2002 which revealed a conformance rate of less than 10 percent for
    disposable lighters from China and testing conducted by the Lighter
    Association in 2004 which revealed a conformance rate of less than 20
    percent for disposable lighters from China. Zippo's conformance with
    the ASTM F-400 voluntary standard is 100 percent.
        It is clear from this data that China and other countries that
    export disposable lighters to the United States are simply ignoring
    ASTM F-400. One of the problems is the fact that an industry standard
    is voluntary and the Chinese have stated that if it is voluntary, they
    do not think they have to comply with it. A mandatory standard would
    provide the Commission staff with the tools to enforce the provisions
    of the standard and compel a high rate of conformance.
        There are at least three reasons for a mandatory standard:

       A mandatory standard would reduce fires, injuries and death;

       If we want consistently high consumer safety standards it
            seems reasonable to require importers to adhere to the same
            high standards American producers already adhere to,
            particularly when they have an extraordinarily large share of
            the market and their products are more or less indiscernible to
            the consumer from lighters produced by American companies; and

       The EU and Canada have both adopted F-400 (ISO 9994) as a
            mandatory standard. If the Commission does not adopt F-400, the
            U.S. will become a dumping ground for lighters that cannot be
            imported into the EU or Canada.

        Adoption of this standard as mandatory by the Commission would
    enhance consumer safety and greatly decrease the possibility of
    exposure to unsafe imported lighters. Zippo urges the Committee to
    adopt the Consumer Product Safety Commission Reform Act, S. 2045, with
    appropriate amendments.
        I thank the Committee again for considering my views.
                                     ______

         Response to Written Questions Submitted by Hon. Mark Pryor to
                              Hon. Thomas H. Moore
    Civil Penalties
        Question 1. One of the complaints about an increased level of civil
    penalties is that many entities would hire more attorneys to become
    more litigious, and thus less cooperative, with the CPSC. What is your
    response to this position?
        Answer. We have already had companies hire some of the most
    expensive attorneys in Washington to fight us under our current civil
    penalty cap. No company wanted to be the first one to draw a million
    dollar fine. Once that psychological barrier was broken, companies went
    back to their normal way of dealing with us (or ignoring us, as the
    case may be). I do not foresee an increase in the cap, even a
    substantial one, as having any significant, lasting impact on
    companies' willingness to fight us, once they and our staff adjust to
    the new regime. I would hope that, if anything, a penalty structure
    that shows that Congress means business when it comes to protecting
    consumers will make companies more cooperative, not less. I think some
    of the bigger companies currently view us as more of a nuisance than a
    real check on their corporate behavior. That needs to change.

        Question 2. Do you believe this will enable the agency to make
    distinctions in the assessment of penalties?
        Answer. Yes, most definitely. It will also give us the room to
    start assessing penalties for violations of multiple subsections of
    section 19 and not fall back, as we have almost exclusively, on failure
    to report as the only violation that we pursue. We would be able to
    review cases from top to bottom and start enforcing the other
    prohibitions in our statutes that we presently have little reason to
    pursue because they would not increase the penalty amount that we could
    assess. Now, given the low overall penalty amount, if we were to assess
    a penalty for multiple violations of section 19, it would have the
    effect of lessening the amount of the penalty for the reporting
    violation.

        Question 3. Some have expressed a concern that these penalties
    could be assessed with little more discretion than the current
    sentiment of the Commission. This bill requires the CPSC to establish a
    rulemaking establishing criteria for their imposition. How would you
    foresee this criteria being set?
        Answer. We already have an open rulemaking proceeding, spurred by
    industry, to formally add criteria to those currently listed in our
    statute. I took issue with some of the new criteria that were being
    proposed. A copy of the statement that I issued on the draft proposals
    can be found at http://www.cpsc.gov/pr/statements.html, under ``Civil
    Penalty Factors.'' We could use that proceeding, which is still open,
    to flesh out any additional criteria Congress may wish to add to the
    statute.

        Question 4. Do you believe this should alleviate some concerns?
        Answer. I have always thought these concerns were a bit of a red
    herring. Industry will not be completely satisfied until it has a
    ``price list'' showing what we will assess for a particular violation
    with a precise list of mitigating circumstances. Then they can really
    factor in the cost of compliance versus the benefit of not complying.
    The violations we see are as unique as the company, the product, the
    hazard, and the people who made the judgments that led us to seek a
    penalty. Precision is not possible. But I do welcome Congress's input
    on any additional factors it wants us to consider.
    Criminal Penalties
        Question 1a. In your testimony you describe the requirement of
    notice as an impediment to the Justice Department pursuing criminal
    sanctions. Would you mind describing how many, if any, actions have
    been pursued by the Justice Department and the nature of those actions?
        Answer. As best I can determine, there have been only three
    criminal cases that stemmed from violations of the Consumer Product
    Safety Act since the agency's inception. The first criminal penalty
    under this statute was not assessed until 1997, when two men pleaded
    guilty to criminal charges stemming from their distribution of volatile
    alkyl nitrites. Both men had continued to sell the products after the
    Commission had first notified them that the product they were selling
    was banned under the CPSA. One man was sentenced to 5 years' probation,
    with home detention for 6 months and the other was sentenced to 2
    years' probation, 150 hours of community service and fined $2,500.
        In 2000, a man was sentenced on charges arising from his removal of
    the child safety mechanisms from child-resistant disposable cigarette
    lighters. While this violated the CPSA, the criminal charges that were
    brought against him were for obstruction of justice and making false
    statements to CPSC. This is a tactic that the Department of Justice's
    Office of Consumer Litigation must sometimes resort to in order to
    obtain criminal convictions for violations of the CPSA. He was
    ultimately sentenced on the false statement charge and sentenced to 2
    years in prison.
        In January of 2002, a man pled guilty to charges stemming from his
    importation of counterfeit and substandard electrical products. Once
    again the Justice Department proceeded on the basis of false statement
    made by the defendant to a CPSC investigator as well as false
    statements made on Customs importation forms. He was sentenced to 14
    months in prison, with 3 years of supervised release and fined $30,000.
        Copies of the relevant press releases can also be found at:

            http://www.cpsc.gov/cpscpub/prerel/prhtml97/97167.html

            http://www.cpsc.gov/cpscpub/prerel/prhtml00/00101.html

            and

            http://www.cpsc.gov/cpscpub/prerel/prhtml02/02091.html.

        Question 1b. Does the agency initiate these actions?
        Answer. The Department of Justice pursues them at our request.

        Question 2. In your opinion, are criminal penalties reserved for
    the most egregious ``bad actors''?
        Answer. Yes. Certainly the requirement that we have to tell someone
    they've violated our statute and then catch them at the same violation
    again, tends to make it that way for violations of the CPSA. The
    criminal violations that we pursue under the Federal Hazardous
    Substances Act tend to be situations where we have recalled a product
    and the company subsequently resells the recalled product to another
    company or where we have seen repeated violations of the same mandatory
    requirement by the same company. Since our statutes currently only
    provide for misdemeanor charges--criminal fines and no more than 1 year
    in jail--the really bad actors currently do not face much in the way of
    punishment unless we can find non-CPSC statutory violations, as in two
    of the three cases above.

        Question 3. You note in your written testimony that the Justice
    Department has recommended a two-tiered system. How would you foresee
    the Agency utilizing a new two-tiered system?
        Answer. I think we would consult informally with the Justice
    Department prior to their seeking an indictment and decide in
    conjunction with them how to proceed given the evidence and the gravity
    of the violations. Because we do not prosecute these cases, we would
    necessarily depend on Justice's expertise in similar types of cases.

        Question 4. Some have expressed this would have negative effects on
    attracting board members and company executives. How would you respond?
        Answer. I would hope that prospective Board Members and company
    executives would not factor into their employment decision the
    probability as to whether they might knowingly or willfully break the
    law and what the penalties for such a violation might be. But to the
    extent they do, we are all better off if the penalties in our statutes
    are strong enough to make such people seek other employment.
    Preemption
        Question 1. You have noted that the Mattress Flammability Standard
    offered new preemptive interpretation. Would you describe your concerns
    with this interpretation?
        Answer. On January 13, 2005, the proposed rule for the Flammability
    (Open Flame) of Mattresses and Mattress/Foundation Sets was published.
    The language in the preamble on preemption tracked the language that
    had been used in rulemakings under the FFA since the issuance of the
    Executive Order in 1996, merely stating the statutory provision without
    attempting to interpret it.
        A year later, in January of 2006, the Commission released the draft
    final mattress rule to the public. Specifically omitted from the public
    document was the preemption section of the preamble. All that appeared
    in the public document is the title of the section ``N. Executive Order
    12988 (Preemption)'' and the words ``[TO BE INSERTED].'' This was the
    first public notice from the Commission that there could be a change in
    the preemption language. New proposed preemption language (without any
    input from my office) was circulated to the Commissioners' offices, but
    was not released to the public. On February 1, 2006, I asked my
    colleagues to release the proposed preemption language so that the
    public would have an opportunity to comment on it. They agreed and it
    was put on our website, but not prominently, as I had requested. To the
    extent they were aware of it, the public had 2 weeks to comment on this
    language before the Commission vote. I had also requested that the
    General Counsel's memo on the language be made public, as it was the
    underpinning for this new interpretation. This was not agreed to, so
    the rationale for the new interpretation was not available to the
    public, other than what they could glean from the proposed preemption
    language itself.
        I believe that the majority's interpretation that the preemption
    section of the Flammable Fabrics Act preempted not only non-identical
    state regulations (a proposition with which I have no problem) but that
    it also preempted many state civil court actions by people seeking to
    redress injuries stemming from fires involving complying mattresses,
    was unfounded. I saw no evidence that this was what Congress had
    intended and saw absolutely no reason to attempt to make this strained
    argument after 10 years of silence by the Commission on this point. My
    statement on the preemption issue can be found at http://www.cpsc.gov/
    pr/statements.html under ``Mattresses.''
        It has been said that the preamble is not part of the regulation
    and will not appear in the Code of Federal Regulations and thus has no
    force or effect. A court may or may not decide to give weight to an
    agency's interpretation of such a prevision. I liken a preamble of a
    regulation to the legislative history of a statute. It explains, often
    in great detail, why the Commission took the action it did in any
    particular instance. The Commissioners pay as much attention to the
    drafting of the preamble as they do to the language of the regulation
    itself. The preamble is the foundation upon which the regulation rests
    and a bad foundation can undermine the validity of the regulation. The
    preamble is referenced by stakeholders. I often go back to look at
    earlier Commission precedents as expressed in the preamble of a
    regulation to find the basis for a Commission action. Clearly if the
    majority did not feel the preamble carried any weight they would not
    have used it to put interpretive gloss on the preemption provisions of
    the FFA. What would have been the point?

        Question 2. Do you believe the language is S. 2045 adequately
    reaffirms the codified preemption language in the CPSA?
        Answer. It does not affirmatively state what the Congress's
    intention is with regard to the preemptive effect of our statutes on
    state civil court actions, except in the case of the CPSA, where
    Congress's intent has always been clear. While the language does
    prevent further interpretation of the current preemption provisions by
    the Commission and the Executive Branch, I am puzzled why it does not
    simply state what the preemptive effect of standards or rules under the
    FFA, the FHSA and the PPPA are with regard to state court actions. If
    the intent is to leave it up to the courts to try to figure out what
    the congressional intent is, it does appear to do that. Currently there
    are situations where a children's product is regulated under the FHSA,
    for example, but the adult version of the product is regulated under
    the CPSA. There should be no difference in the preemptive effect of the
    regulations affecting those two products, yet that could be the case if
    courts attempt to extend a preemption interpretation, similar to that
    given the FFA in the mattress rulemaking, to our other statutes.

        Question 3. How would you respond to entities worried that this
    bill would erase all assumption of preemption under product safety
    rules and standards?
        Answer. I do not think it does that, but to be honest, I am not
    entirely sure what the Clarification subsection does.

        Question 4. Do you believe the current preemption gives companies
    some assurance of a national protocol?
        Answer. Yes with regard to state regulatory actions. What it does
    not do is make it clear whether or not a Federal standard is the
    ceiling for redress of personal injury cases (and therefore potentially
    preventing people who are injured by products that meet that standard
    from being able to sue for damages for their personal injuries) or
    whether a Federal standard is a minimum safety requirement, or a floor,
    thus allowing such lawsuits.
    Disclosure
        Question 1. Commissioner Moore, some claim that keeping information
    secret from the public encourages fuller disclosure by companies. Some
    also contend that this legislation would discourage this disclosure.
    How would you respond to these contentions?
        Answer. I know some argue that being able to provide information to
    CPSC and having it kept secret from the public somehow encourages
    ``fuller disclosure'' by companies than there would be otherwise. Some
    point to our Retailer Reporting Model, now being followed by four
    companies, as an example of where there is a ``fuller disclosure'' of
    information which might discontinue if the 6(b) protections, as they
    currently exist, were modified. However, I do not accept these
    arguments because the fact is the reporting model was developed to
    assist the retailers in complying with their lawful obligation to
    report to us and thereby avoid the repercussions that follow a failure
    to report.
        Under circumstances provided in the statute, companies are
    required, by law, to report certain information to the Commission and
    to respond truthfully and completely to our information requests.
    Companies can keep certain information out of the public eye by
    appropriately identifying information such as trade secrets, which they
    want kept confidential and the Commission can use the law enforcement
    exception to the Freedom of Information Act, if it feels withholding
    certain information is necessary. What more assurance companies need
    for them to provide the information they are required to provide, I do
    not know.
        Public safety is our concern, not protecting companies from public
    scrutiny, and when there is a chance that there is a product in the
    stream of commerce that could hurt or injure someone we must have the
    ability to compel companies to tell us about that product and we must
    have the ability to quickly inform the public so that the product does
    not cause harm. Quick and accurate dissemination of information about
    potentially harmful products is essential to protecting the public from
    the risk of harm posed by those products. Given the often very
    difficult time we have obtaining information from some companies now, I
    doubt seriously that the current provisions of 6(b) play much of a role
    in encouraging disclosure. Consumers want timely, accurate warnings
    about products that may cause harm to their families. We should be able
    to provide that information to them in an accurate and expeditious
    manner.

        Question 2. How should the Commission react if companies don't
    provide information required by law?
        Answer. The failure to furnish information required by our statutes
    is prohibited by law and can subject the offender to possible civil and
    criminal penalties. The Commission should have the necessary tools and
    resources and be willing to aggressively enforce the laws adopted for
    the protection of the American consumers. S. 2045 provides increased
    resources and a substantial increase in our civil penalty cap. With
    these additional tools, the Commission could be in a much stronger
    position to compel compliance with its statutes and companies will be
    less inclined to test the will of a stronger Commission by withholding
    lawfully required information.

        Question 3. How do you believe we can ensure the best collaboration
    between the CPSC and industry in relation to this issue?
        Answer. The law requires reporting certain information to the
    Commission. The Commission is the regulator and has a job to perform
    with respect to the American public and the regulated community. One of
    the best ways to provide for the safest products for the marketplace is
    through a cooperative approach with industry. When working with
    industry can help us achieve our product safety goals, we should
    certainly be willing to work very closely with them, and we have. But,
    competition in the marketplace does not and will not inevitably take
    the form of a rivalry to produce the safest products. To successfully
    continue the mission of the agency, the Commission must have the
    resources and the flexibility to respond quickly and effectively to
    critical situations where the lives and health of the American public
    are at risk, whether the affected company or industry is cooperating
    with us or not.
        The best way for Congress to ensure collaboration between the CPSC
    and industry with respect to information that might lead to the
    determination that a product presents a hazard is to give the
    Commission the tools it needs to enforce its statutes. The Commission
    must then be willing to clearly communicate its expectations of
    industry for compliance while at the same time clearly communicating
    that there is a system in place for the responsible treatment of
    information provided.
    Attorneys General
        Question 1. Commissioner Moore, in your submitted testimony you
    state that the enforcement by Attorneys General could be a tremendous
    benefit given the agency's limited resources for litigation. What kind
    of resources does the agency have for litigation purposes?
        Answer. We have a pool of resources which include our existing
    compliance staff (including 10 attorneys in the legal branch) and
    several members from our General Counsel staff (2-3 attorneys), and
    about $170,000 in contract funds to draw upon. The pool of money is not
    a litigation pool but a pool for technical support, of which litigation
    is one part. We don't budget separately for litigation and technical
    support.
        We generally have conducted a limited amount of litigation so the
    funds and staff are made available for other support activities. If
    litigation develops as a priority, then the Commission must reassign
    the necessary resources away from other ongoing activities.

        Question 2. What, if any, relationship has the CPSC had with
    Attorneys General?
        Answer. The most common ways in which the CPSC relates with State
    Attorneys General is through our Office of Compliance and our Office of
    the General Counsel. Interactions with State Attorney General Offices
    often involve addressing inquiries related to assistance in prosecuting
    state criminal cases, jurisdictional questions, and information
    exchange.
        Commons sorts of inquiries include:

       Requests for assistance in state prosecution of criminal
            cases involving alleged arson, child abuse, poisoning, etc.,
            where a consumer product might be involved, including requests
            to provide CPSC employees as witnesses.

       Inquiries on the regulatory authorities of the Commission
            versus the police powers of states, particularly with respect
            to state laws requiring licensing and insurance for use of low
            speed electric bicycles versus the Commission's regulations
            concerning the design/performance specifications for these
            products.

       Inquiries concerning sharing of CPSC accident and
            investigation reports with states under authority of section
            29(e) of the CPSA and the interplay between that authority and
            the requirements of the Freedom of Information Act.

        The Commission has also, on occasion, been petitioned by a State
    Attorney General's Office to begin a rulemaking and State Attorney
    General's Offices often comment on pending rulemaking proceedings. In
    the past, these Offices have also joined us in distributing safety
    information, alerted us to hazards which have led to recalls, shared
    information on a State's safety testing of potentially hazardous
    products, jointly announced recalls with us and cooperated with us in
    issuing consumer products safety warnings.
                                     ______

         Response to Written Questions Submitted by Hon. Mark Pryor to
                     Travis Plunkett and Edmund Mierzwinski
    Fast Track Authority
        Question 1. Chairman Nord supports giving the CPSC ``fast track''
    authority to make voluntary consensus standards into mandatory
    standards. Since voluntary standards tend to reflect the lowest common
    denominator safety standard, do you support this proposal?
        Answer. We have concerns about this proposal because we fear that
    manufacturers may ``game the system'' for a variety of reasons:
    manufacturers and others representing a specific industry may push
    through an intentionally weak voluntary standard that they would want
    CPSC to ``rely upon'' to preempt stronger CPSC action that CPSC may be
    considering in a rulemaking proceeding; to preempt a stronger state
    law; and/or to serve their economic interest by thwarting foreign
    competition.

        Question 2. What would the effect of adopting an industry standard
    be on more restrictive state standards?
        Answer. Section 26 of the Consumer Product Safety Act (15 U.S.C.
    2075), ``Effect on State Remedies'' provides that when a consumer
    product safety standard is in effect and applies to a risk of injury
    associated with a consumer product, a State does not have the authority
    ``to establish or continue to effect any provision of a safety standard
    or regulation . . . which are designed to deal with the same risk of
    injury associated with such consumer product, unless such requirements
    are identical to the requirements of the Federal standard.'' The
    provision further provides, however, that a State may establish or
    continue in effect a safety requirement that ``provides a higher degree
    of protection from such risk of injury'' after the State files a waiver
    with the Commission. After notice and comment, and a finding by the
    CPSC that the State regulation provides a significantly higher degree
    of safety than the Federal regulation and the State regulation does not
    unduly burden interstate commerce, CPSC may grant the State a waiver
    for a stronger regulation.
        Thus, the likely impact of CPSC's reliance upon a weak voluntary
    standard would be the preemption of a stronger, more consumer
    protective state law. We know of no incidence of a State filing for a
    waiver under section 26 of the CPSA.
    Corrective Action Plans
        Question 1. Currently, corrective action plans (recall procedures)
    are determined by a manufacturer. This bill would give the CPSC
    authority to approve a corrective action plan it believes to be in the
    public interest. What concerns should we have about the current
    structure for corrective action plans?
        Answer. Virtually all recalls CPSC administers are voluntary
    recalls. As such, CPSC negotiates the terms of the recalls with the
    recalling entity, most likely the manufacturer. Currently, recalling
    entities have vast leverage when negotiating a recall because they have
    the ability to sue CPSC over the disclosure of information and because
    they can elect the corrective action.
        The recent example of the Simplicity Crib recall is a case in
    point. CPSC and Simplicity announced the recall of certain models of
    simplicity cribs on September 21, 2007, after publicly acknowledging 3
    deaths. The recall was conducted because ``drop-side failures result
    from both the hardware and crib design, which allow consumers to
    unintentionally install the drop-side upside down. When the drop-side
    detaches, it creates a gap in which infants can become entrapped.'' \1\
    However, at that time, while the recall warned of a severe entrapment
    hazard, no corrective action was in place. Unfortunately, the press
    release indicated that a repair kit was available, when it was not. An
    October 25, 2007 statement from the Commission indicated that the
    repair kit ``was now available.'' \2\ Further, we believe that a repair
    kit is inadequate and a refund to consumers should have been available
    immediately.
    ---------------------------------------------------------------------------
        \1\ CPSC Press Release, ``About 1 Million Simplicity Cribs Recalled
    Due To Failures Resulting in Infant Deaths,'' September 21, 2007,
    available on the web at http://www.cpsc.gov/cpscpub/prerel/prhtml07/
    07307.html.
        \2\ CPSC Press Release, ``Repair Kits Ready To Be Sent To Parents
    and Caregivers With Recalled Simplicity Cribs,'' October 25, 2007,
    available on the web at http://www.cpsc.gov/cpscpub/prerel/prhtml08/
    08043.html.
    ---------------------------------------------------------------------------
        This Subcommittee should be concerned that industry has too much
    leverage and discretion in selecting and offering corrective action
    plans which may not exist or may be entirely inadequate to protect
    consumers from harms caused by the recalled product.

        Question 2. How should we address these concerns?
        Answer. We believe that the most effective way to address these
    concerns is to significantly alter the imbalance caused by section 6(b)
    of the CPSA and to give CPSC the authority to approve corrective action
    plans before they are implemented. We believe that S. 2045 goes a long
    way to ameliorating these concerns by the changes made to the CPSA by
    the inclusion of sections 7 and 13 within S. 2045. By eliminating a
    manufacturer or other entity's ability to sue the agency over the
    disclosure of information, this bill vastly decreases the leverage a
    recalling entity has over the Commission. Further, by providing that
    the Commission must approve a corrective action plan and can deem an
    approved action plan ineffective, S. 2045 includes an important
    additional step that will seek to ensure that corrective action plans
    are adequate and protective of consumers.
    Disclosure
        Question 1. The current disclosure regime under 6(b) of the
    Consumer Product Safety Act provides almost unlimited safeguards for
    industry. Many of the consumer groups I have met with have expressed
    concern about this structure. Would you mind elaborating about your
    concerns for this structure?
        Answer. We have one primary concern about 6(b): critically
    important safety information is not being disclosed by CPSC to the
    American public. This lack of disclosure results in many more people
    being seriously injured or even killed by known and preventable
    hazards.
        For many years, Consumer Federation of America, U.S. PIRG and other
    consumer groups have urged Congress to eliminate section 6(b) of the
    CPSA. This section of the Act restricts CPSC's ability to communicate
    safety information to the public. This secrecy provision is unique to
    the CPSC and it prevents the timely release of information about
    serious hazards relating to children's and other consumer products.
    Under this provision, the CPSC is required to give a company an
    opportunity to comment on a proposed disclosure of information. If the
    company has concerns about the wording or the substance of the
    disclosure, they can object. CPSC must accommodate the company's
    concerns or inform them that they plan to disclose the information over
    their objections. The company can then sue the Commission seeking to
    enjoin them from disclosing the information. Thus, this provision
    creates a time-consuming process between CPSC and the affected company,
    often serving to delay or deny the release of important consumer safety
    information.
        Two recent examples highlight the anti-consumer impact of this
    provision. First, on October 22, 2007, CPSC staff announced its results
    of a special evaluation of consumer lead kits. CPSC staff tested
    samples of commonly available test kits on a variety of products
    containing different levels of lead. CPSC found that, ``many of the
    tests performed using the kits did not detect lead when it was there
    (false negatives); some indicated lead was present when it was not
    (false positives). Of 104 total test results, more than half (56) were
    false negatives, and two were false positives. None of the kits
    consistently detected lead in products if the lead was covered with a
    non-leaded coating. Based on the study, consumers should not use lead
    test kits to evaluate consumer products for potential lead hazards.''
    \3\
    ---------------------------------------------------------------------------
        \3\ CPSC Press Release, ``CPSC Staff Study: Home Lead Test Kits
    Unreliable,'' October 22, 2007, available on the web at http://
    www.cpsc.gov/cpscpub/prerel/prhtml08/08038.html.
    ---------------------------------------------------------------------------
        However, this study fails to mention which lead kits the CPSC
    actually tested--a critically important piece of information for
    consumers seeking to evaluate which kits to use or avoid and an example
    of the absurd limits placed on the agency by Section 6(b). In addition,
    the study fails to disclose the threshold lead level that was used as
    the reference point for determining false negative test results. This
    is critical information for others to assess the technical basis upon
    which the CPSC drew their conclusions.
        Contrast that process to that of Consumer Reports testing of lead
    kits. In the magazine's December 2007 edition, it has information about
    results from its recent testing of five home lead-testing kits and
    concluded that three of the five kits were useful though limited
    screening tools for consumers concerned about lead levels in the
    products in their homes. Importantly, the magazine disclosed the names
    of all five kits. Such information is vital for parents and families to
    have. The CPSC does a disservice to consumers when it fails to make
    this important information available to the public.
        Second, and even more troubling, is the CPSC's knowledge of
    numerous, serious and well documented harms caused by Stand `n Seal, a
    spray-on waterproofing sealant for tile grout. According to an October
    8, 2007 article in The New York Times, after a new ingredient was added
    to Stand `n Seal in the spring of 2005, ``calls from customers,
    emergency rooms and doctors started to pour into poison control centers
    and, initially in smaller numbers, to the Consumer Product Safety
    Commission's own hot line.'' \4\ One child stopping to talk to his
    father who was using the sealer, suffered damage to 80 percent of the
    surface area of his lungs.\5\ With complaints mounting, the
    manufacturer's chief executive told staff answering the company's
    consumer hotline not to tell customers that others had reported similar
    complaints because doing so ``may cause unnecessary public concern.''
    \6\ ``Nearly 3 months passed between the time [the manufacturer] first
    received a report of an illness and the official recall by the Consumer
    Product Safety Commission, a period during which dozens were
    sickened.'' \7\
    ---------------------------------------------------------------------------
        \4\ Lipton, Eric, ``Dangerous Sealer Stayed on Shelves After
    Recall,'' New York Times, October 8, 2007.
        \5\ Ibid.
        \6\ Ibid.
        \7\ Ibid.
    ---------------------------------------------------------------------------
        The CPSC officially recalled the product on August 31, 2005. In the
    press release, CPSC acknowledged, ``88 reports from consumers who have
    had adverse reactions after using the aerosol product, including 28
    confirmed reports of overexposure resulting in respiratory symptoms for
    which medical attention was sought for coughing, irritation, difficulty
    breathing, dizziness and disorientation. Thirteen individuals required
    medical treatment, including overnight hospitalization.'' \8\ The
    Commission did not disclose critical safety information to the public
    and used 6(b) as a shield to maintain the secrecy of these severe
    health effects. However, even after the official recall, a hazardous
    product remained on the shelves because the replaced product contained
    the same hazardous chemicals and many people were severely injured.
    ---------------------------------------------------------------------------
        \8\ CPSC Press Release, ``CPSC, Tile Perfect Inc. Announce Recall
    of Stand `n Seal Grout Sealer Due to Respiratory Problems,'' August 10,
    2005, available on the web at http://www.cpsc.gov/CPSCPUB/PREREL/
    prhtml05/05253.html.
    ---------------------------------------------------------------------------
        We conceptualize our concerns with 6(b) in three ways: (1) Section
    6(b) creates a dynamic between CPSC and the industries it regulates
    that requires the Commission to request permission from them to
    disclose critical product safety information to the public; (2) This
    process takes a long time and ultimately delays or denies such
    disclosure; and (3) Manufacturers and others have the ability to sue
    CPSC over information disclosure, which grants these entities vast
    leverage over CPSC.

        Question 2. Do you believe this bill strikes a balance to address
    those concerns yet protects the economic concerns?
        Answer. We view section 7 of S. 2045 as a reasonable compromise.
    This section retains section 6(b) and thus provides manufacturers and
    others the ability to verify the accuracy of such information. The
    timeline for 6(b) is cut in half and the industry's ability to sue the
    agency is eliminated. In addition, such information disclosures are
    already protected by the Freedom of Information Act (FOIA) which
    protects trade secrets and other proprietary information from public
    disclosure. S. 2045, as amended and passed by the Senate Commerce
    Committee, also includes an internal review process that allows an
    entity not desiring disclosure to appeal to the CPSC's General Counsel
    and then to the full Commission. We believe, however, that these time
    frames should be shortened significantly to allow for more immediate
    review and potential disclosure.

        Question 3. How would you envision an appropriate disclosure
    regime?
        Answer. Consumer groups have advocated for years that section 6(b)
    should be eliminated entirely. We view this provision as the ultimate
    secrecy provision that thwarts the public disclosure of important
    information. Further, we believe that existing protections within FOIA
    protect manufacturer's economic interests. However, we have conceded
    that we would support retaining section 6(b) if the timeframes were
    shortened considerably and if the ability of manufacturers and others
    to sue CPSC were eliminated. In addition to these elements, we support
    a significant exception allowing for the disclosure of information to
    protect the public health, as well as requirement that the CPSC create
    a searchable adverse event database. This database should contain
    consumer complaints and industry reports of safety concerns relating to
    toys and other children's products, as well as other consumer products.
                                     ______

         Response to Written Questions Submitted by Hon. Mark Pryor to
                                Alan Korn, J.D.
    Civil and Criminal Penalties
        Question 1. Commissioner Moore stated in his testimony that the
    Department of Justice supports a two-tiered criminal penalty system, as
    outlined in the CPSC Reform Act, and since the Department of Justice is
    responsible for criminally prosecuting the Commission's criminal cases,
    Commissioner Moore is in support of this harmonization. What are your
    thoughts on the changes to criminal penalties proposed in S. 2045 and
    how do you anticipate that this would affect manufacturers' actions?
        Answer. Safe Kids did not provide an opinion on this provision in
    the bill. We do not feel we have the necessary expertise on criminal
    sanctions to be helpful.

        Question 2. Some companies have suggested that an increase in
    penalties will create a more litigious atmosphere between manufacturers
    and the CPSC. The companies claim that as a result voluntary
    disclosures will be harmed and more CPSC resources will need to be
    dedicated to enforcement activities. Do you believe that increasing
    penalties will be detrimental to public safety?
        Answer. No, to the contrary. Ultimately, the increased civil
    penalties, we believe, will not be detrimental to public safety. Safe
    Kids USA believes that increasing the civil penalties will provide an
    excellent economic deterrent to bad behavior (or in the alternative,
    the increased civil penalties will provide an economic incentive for
    companies to do the right thing by not engaging in the prohibited acts
    listed in Section 19 of the Consumer Product Safety Act).
        In some cases, and in particular when larger companies are
    involved, the current $1.8 million cap may not be enough of an economic
    deterrent to prevent the company from engaging in an unlawful act. For
    example, a company that has $50 million worth of product in the
    marketplace may be willing to incur the civil penalty instead of
    reporting a defect or injury as required under Section 15 in hopes of
    avoiding a recall (failing to report any information required by
    Section 15(b) is a prohibited act under Section 19 and is subject to a
    civil penalty). Safe Kids has long advocated for an increase in the
    civil cap to an amount that better represents a deterrent. We support
    the provision in the CPSC Reform Act of 2007 that would increase civil
    fines (for all statutes under the CPSC's jurisdiction) up to $250,000
    per violation with a cap at $100 million.
                                     ______

         Response to Written Questions Submitted by Hon. Mark Pryor to
                               Joseph M. McGuire
    Attorneys General
        Question 1. Mr. McGuire, I recently received a letter from your
    association's president regarding this Act. I very much appreciate this
    input. However, I do have a question regarding some positions of the
    positions expressed. In Mr. Timmons comments, he expressed that greater
    AG enforcement would require manufacturers to expend resources on
    litigation instead of advancing product safety. However, he soon after
    states that increased penalties would force companies to become more
    litigious rather than cooperate for public safety. These positions seem
    counter to one another when one advocates a concentration more on
    consumer safety than litigation while the other proposes a response of
    litigation rather than focusing on consumer safety. How would you
    respond to this supposition?
        Answer. AHAM and the NAM CPSC Coalition support reauthorization and
    many provisions in S. 2045. Unfortunately, several major provisions in
    your legislation divert attention and resources from product safety and
    toward litigation. The Attorneys General provision eviscerates the
    uniformity and application of Federal law and undermines CPSC
    procedures. It will result in unnecessary litigation based on
    individual Attorneys General interpretation of law and require CPSC
    intervention and litigation. We support instead a system in which the
    Attorneys General participate in cooperation with and after the
    approval of the CPSC when a final determination has been made of
    violation of a law. Then, the CPSC may seek or agree to use the
    resources and geographical reach of the states.
        Similarly, increasing the penalties by hundred fold to a maximum of
    $100 million means that many penalty cases now will be of such high
    value that companies will be incentivized to litigate them. Under the
    present system, penalties, coming after the true penalties of the
    costs, burdens, and loss of good will and bad publicity of a recall,
    virtually always are settled voluntarily and constitute not only a
    financial detriment but a new round of bad publicity. Once the stakes
    are raised as high as S. 2045 makes them, firms will find it in their
    interest to litigate these penalties.
        Question 2. Your testimony recognizes that there is a crisis of
    confidence in the safety of consumer products in the United States
    marketplace. The testimony also recognizes that this perception has an
    adverse effect on U.S. manufacturers. Yet, you oppose attorney general
    enforcement of consumer product safety laws, which would help alleviate
    the strain on Commission resources and provide consumers with more
    confidence in the products they purchase. It seems to me that the
    American consumer wants more ``Cops on the beat.'' Why deny the
    consumers of this added protection?
        Answer. As stated in answer to the previous question, we do support
    ``more cops on the beat'' through extended use of Attorneys General in
    cooperation with, under the guidance of and with the approval of the
    CPSC. Creating 50 new mini, CPSCs, however, is a bad policy decision
    and will significantly adversely impact U.S. manufacturers and
    retailers and divert attention from protecting consumers.
    Criminal Penalties
        Question. If the Commission is not inclined to aggressively
    prosecute criminal violations of its statutes through the Department of
    Justice, why would this provision present a problem for any
    manufacturer, importer, or retailer, except in the most flagrant and
    egregious cases of violations of Federal consumer product safety laws
    under Commission jurisdiction?
        Answer. We do not oppose increased criminal penalties for egregious
    behavior. Your legislation, however, unfortunately lowers the scienter
    requirement by eliminating the need for the government to show for
    criminal penalties a willful act that occurred after notification by
    the Commission. Instead, the much less heightened ``knowing''
    requirement applies which is essentially the same as for civil
    penalties. This raises serious constitutional issues and potentially
    threatens to add within the scope of criminal sanctions a wide variety
    of U.S. management and board members who will have very little actual
    knowledge and absolutely no criminal intent. It is a misuse,
    misapplication and unnecessary extension of the criminal laws which
    will not enhance, for example, the need for companies to use safety
    circles and other pre-market and post-market mechanisms to evaluate
    safety-related complaints.
                                     ______

         Response to Written Questions Submitted by Hon. Mark Pryor to
                                  Al Thompson
    Resource Priority-Recall Effectiveness
        Question 1. Mr. Thompson, in your submitted testimony you speak of
    the need to speed up recall timelines and create better dissemination
    of recall information to the public. Would you mind addressing why this
    is a priority for your organization and its members?
        Answer. Reducing the timeline for the CPSC to implement a recall is
    important to retailers because the safety of consumers is our highest
    priority. Once a company and the CPSC have gathered sufficient evidence
    to demonstrate that a recall is necessary, we believe the public should
    be made aware as quickly as possible. While retailers remove products
    from store shelves when potential problems have been identified, the
    CPSC actually issues a recall. If a retailer's testing program detects
    a problem with a product and notifies the CPSC that a recall is
    necessary, it should not take weeks or even months for a recall
    announcement to be made by the CPSC.

        Question 2. Do you have any ideas on how we might achieve this goal
    in the bill?
        Answer. S. 2045 will already go a long way to resolve this problem
    because it significantly increases resources for the CPSC. In addition
    the legislation could be enhanced by requiring CPSC to review its
    recall procedures and processes for corrective action plans and report
    back to Congress within 6 months of the date of enactment.
    Third Party Labs
        Question 1. Mr. Thompson, you have also mentioned the need for the
    credentialing of labs by the CPSC or an independent third party. You
    continue, however, that you are hesitant to support the mandate to use
    independent labs. Would you mind discussing the current lab structure
    of some of your members' labs?
        Answer. A significant number of RILA companies use independent
    third-party labs as part of their product safety programs. One retailer
    has invested the resources to establish three worldwide testing
    facilities, which issue more than 20,000 test reports per year. These
    testing facilities include a state-of-the-art lab based in the United
    States that employees 27 permanent staff members, many of whom hold
    advanced professional degrees. We believe these facilities should be
    able to remain part of that company's product safety efforts, and we
    welcome the modification in the manager's amendment to create a process
    to approve proprietary laboratories. This is particularly important
    because increased testing efforts have stretched the capacity of
    independent laboratories.

        Question 2. How can the American public feel confident in the trust
    of a non-independent lab?
        Answer. The goal of retailers who invest in proprietary labs is to
    provide more assurance of product safety, not to circumvent safety
    requirements. We believe the manager's amendment creates sufficient
    requirements to demonstrate that a proprietary lab will provide an
    equal or greater level of consumer safety as an independent lab. RILA
    members have increased their due diligence and safety protocols to
    assure product safety and the American public should feel confident
    about the products they purchase in stores.
    Criminal Penalties
        Question 1. Mr. Thompson, you have mentioned that the proposed
    criminal penalties would create a less collaborative effort between
    your members and the CPSC. However the current law already mandates
    some criminal penalties. How does the current law affect business
    planning and the collaborative effort with the CPSC?

        Question 2. Why would the proposed law be any different?

        Question 3. To my knowledge, only one case has been prosecuted
    under the criminal statute. This case was a severe case by an extremely
    bad actor. Does this historical precedent of the CPSC only taking
    action in the most extreme cases provide the comfort under current law?

        Question 4. Why would the industry think this criteria would change
    under the proposed law?
        Answers 1-4. RILA is concerned with the dramatically increased
    civil penalties and the reduction in due process for criminal penalties
    in the bill. On criminal penalties, current law requires that a person
    has knowingly and willfully violated provisions of the Consumer Product
    Safety Act, after having received notice of such violation from the
    CPSC. S. 2045 would eliminate the willful standard and the requirement
    of prior notice, which would expose retailers to criminal prosecution
    even though they may not have been aware they were selling a defective
    product. It is not uncommon that a retailer is not part of the
    information chain between the manufacturer and the CPSC regarding an
    unsafe product, and the retailer may not learn of the problem until a
    product is officially recalled. Current law would protect the retailer
    in this example because the product was not knowingly and willfully
    sold. At a minimum, the scienter standard in current law of a knowing
    and willful violation should remain, as well as a requirement that a
    public notice be made for a recalled product.
    Correction Action Plans
        Question 1. Currently, corrective action plans (recall procedures)
    are determined by a manufacturer. This bill would give the CPSC
    authority to approve a corrective action plan it believes to be in the
    public interest. Would you mind describing to me the process for how
    corrective plans are currently determined?

        Question 2. How do we know the public interest is placed before a
    company's bottom line?
        Answers 1-2. Consumer confidence in products is paramount, and RILA
    members work with their suppliers to assure that products are safe.
    When a recall is announced, RILA's members promptly remove the product
    from the shelf and activate a block on cash registers to prevent the
    product from inadvertently being sold.
        Brand reputation is critical to a retailer's success and serving
    the public interest is a component of brand reputation. Retailers take
    many steps to ensure that the products sold are safe for public use,
    including detailed contract specifications with suppliers, product
    testing, factory audits, and register blocks to prevent a recalled
    product from being sold.