[House Report 104-262]
[From the U.S. Government Publishing Office]



104th Congress                                            Rept. 104-262
                        HOUSE OF REPRESENTATIVES

 1st Session                                                     Part 2
_______________________________________________________________________


 
             DIFFERENTIATION AMONG FATS, OILS, AND GREASES

_______________________________________________________________________


               September 27, 1995.--Ordered to be printed

                                _______


  Mr. Bliley, from the Committee on Commerce, submitted the following

                              R E P O R T

                        [To accompany H.R. 436]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Commerce, to whom was referred the bill 
(H.R. 436) to require the head of any Federal agency to 
differentiate between fats, oils, and greases of animal, 
marine, or vegetable origin, and other oils and greases, in 
issuing certain regulations, and for other purposes, having 
considered the same, report favorably thereon with an amendment 
and recommend that the bill as amended do pass.

                                CONTENTS

                                                                   Page
The amendment....................................................     1
Purpose and summary..............................................     2
Background and need for legislation..............................     2
Hearings.........................................................     4
Committee consideration..........................................     4
Roll call votes..................................................     4
Committee oversight findings.....................................     5
Committee on government reform and oversight.....................     5
Committee cost estimate..........................................     5
Congressional Budget Office estimate.............................     6
Inflationary impact statement....................................     7
Section-by-section analysis of the legislation...................     7
Committee correspondence.........................................     7
Changes in existing law made by the bill, as reported............     8

                               Amendment

    The amendment is as follows:
    Strike out all after the enacting clause and insert in lieu 
thereof the following:

SECTION 1. DIFFERENTIATION AMONG FATS, OILS, AND GREASES.

    (a) In General.--In issuing or enforcing any regulation or 
establishing any interpretation or guideline relating to a fat, oil, or 
grease under any Federal law pertaining to the transportation, storage, 
disposal, discharge, or release of that substance, the head of any 
Federal agency shall differentiate between--
          (1)(A) animal fats and oils and greases, and fish and marine 
        mammal oils, within the meaning of paragraph (2) of section 
        61(a) of title 13, United States Code; or
          (B) oils of vegetable origin, including oils from the seeds, 
        nuts, and kernels referred to in paragraph (1)(A) of such 
        section; and
          (2) other oils and greases, including petroleum.
    (b) Considerations.--In differentiating between the class of fats, 
oils, and greases described in subsection (a)(1) and the class of oils 
and greases described in subsection (a)(2), the head of the Federal 
agency shall consider differences in the physical, chemical, 
biological, and other properties, and in the environmental effects, of 
the classes.

                          Purpose and Summary

    Congress has enacted two principal statutes that address 
the discharge of ``oil'' into the Nation's waters--the Federal 
Water Pollution Control Act, and the Oil Pollution Act of 1990 
(OPA 90). Due to these statutes' broad definition of oil and 
the lack of clear Congressional direction on differentiating 
animal fats and vegetable oils from other types of oils and 
greases, including petroleum, regulatory agencies have not made 
such differentiations in certain implementing regulations they 
propose and promulgate. As these rules could impose costly, 
inappropriate, and sometimes counterproductive requirements on 
handlers and transporters of animal fats and vegetable oils, it 
is necessary for Congress to direct such Federal agencies to 
make such differentiations.

                  Background and Need for Legislation

    In 1990, in response to several petroleum oil spills, 
including the Exxon Valdez spill, the Congress enacted the Oil 
Pollution Act of 1990 (OPA 90) to reduce the risk of oil 
spills, improve facility and vessel oil spill response 
capabilities, and minimize the impact of oil spills on the 
environment. In enacting OPA 90, Congress amended the Federal 
Water Pollution Control Act to impose certain requirements on 
the owners and operators of vessels carrying ``oil'' and on 
facilities posing a risk of ``substantial'' harm or 
``significant and substantial harm'' to the environment, 
including requiring owners and operators to prepare and submit 
response plans to various Federal agencies for review and 
approval, or stop handling oil. Other requirements affecting 
the handling and transportation of oil also were enacted.
    Although petroleum oil was the focus of Congress' attention 
during the enactment of OPA 90, the application of the law has 
not been limited to petroleum oil. The requirements of the law 
have been applied to all oils, including animal fats and 
vegetable oils.
    The animal fat and vegetable oil industry handles, ships, 
and stores over 25 billion pounds of animal fats and vegetable 
oils annually in the United States. These agricultural 
substances are essential components of food products produced 
in the United States. There are several reasons why the 
handling and transportation of animal fat and vegetable oils 
should be treated differently from the handling and 
transportation of non-animal fat and vegetable oils, including 
petroleum. First, there is evidence that exposure of animal fat 
and vegetable oils to the environment does not present the same 
environmental risks as exposure of non-animal fat and vegetable 
oils, such as petroleum. For example, a June 28, 1993, report 
by ENVIRON Corporation, ``Environmental Effects of Releases of 
Animal Fats and Vegetable Oils to Waterways'' and an associated 
Aqua Survey, Inc. study on the aquatic toxicity of petroleum 
oil and of animal fats and vegetable oils made the following 
findings with respect to animal fats and vegetable oils:
          They are readily biodegradable;
          They are not persistent in the environment;
          They have a high biological oxygen demand (BOD), 
        which could result in oxygen deprivation where there is 
        a large spill in a confined body for water that has low 
        flow and dilution;
          They are essential components to human and wildlife 
        diets; and
          They can coat aquatic biota and foul wildlife (e.g., 
        matting of fur or feathers, which may lead to 
        hypothesia).
    Second, there are notable differences in the manner in 
which animal fats and vegetable oils and other non-animal fats 
and vegetable oils are transported. Vessels carrying petroleum 
oils can exceed 500,000 deadweight tons. In contrast, vegetable 
oils typically are carried on small parcel tankers ranging from 
30,000 to 45,000 deadweight tons. Further, differences exist in 
the size of the tanks in vessels carrying these two kinds of 
products. Large tankers carrying petroleum oil may have 10 
large center tanks and 15 wing tanks with individual tank 
capacities reaching approximately 592,000 tons or 177,600,000 
gallons of oil. Parcel tankers carrying vegetable oil typically 
have about 30 to 35 cargo tanks that range from 1,000 to 3,500 
tons capacity each. With regard to transfer operations, the 
typical amount of vegetable oil loaded or offloaded during a 
transfer ranges from 500 to 5,000 tons. In contrast, a tanker 
carrying petroleum commonly loads or offloads its entire cargo 
during one transfer operation.
    Third, spills of animal fats or vegetable oils are likely 
to be smaller and to occur less frequently than spills of non-
animal fats and vegetable oils. Data compiled by the Coast 
Guard reveals that, from 1986 to 1992, animal fats and 
vegetable oils together accounted for only about 0.4 percent of 
the oil spill incidents in and around U.S. waters (both in 
terms of incidents and their volume). Less than half of those 
spills were in water. Further, these spills were generally very 
small. Only thirteen of those spills were greater than 1,000 
gallons. Thus, only about 0.02 percent of all oil spill 
incidents in and around U.S. waters over the last seven years 
were spills of animal fats or vegetable oils greater than 1,000 
gallons.
    Finally, there is evidence that the response to a spill of 
animal fats or vegetable oils should, in certain circumstances, 
be different than the response to a spill of non-animal fats 
and vegetable oils, including petroleum. In comments filed on 
RSPA Docket Nos. HM-214 and PC-1, dated June 3, 1993, the 
Department of Interior (DOI) recommended the establishment of 
response plan requirements for animal fats and vegetable oils 
comparable to those for other oils. This recommendation was 
based on anecdotal data derived from a discharge of butter from 
a U.S. government warehouse into Shoal Creek, Maryland. DOI 
conceded, however, that the principal adverse environmental 
effects of the Shoal Creek incident were caused by the removal 
efforts themselves.
    Differentiation by Federal agencies between animal fats and 
vegetable oils and other oils and greases, including petroleum, 
also is consistent with President Clinton's Executive Order on 
Regulatory Planning and Review (E.O. 12,866, 58 Fed. Reg. 
51,735, 51,736 (1993)) which sets out the following principles:
          In setting regulatory priorities, each agency shall 
        consider, to the extent reasonable, the degree and 
        nature of the risks posed by various substances or 
        activities within its jurisdiction;
          Each agency shall base its decisions on the best 
        reasonably obtainable scientific, technical, economic, 
        and other information concerning the need for, and 
        consequences of, the intended regulation.
          Each agency shall identify and assess alternative 
        forms of regulation and shall, to the extent feasible, 
        specify performance objectives, rather than specifying 
        the behavior or manner of compliance that regulated 
        entities must adopt.
          Each agency shall avoid regulations that are 
        inconsistent, incompatible, or duplicative of its other 
        regulations or those of other Federal agencies.
          Each agency shall tailor its regulations to impose 
        the least burden on society, including individuals, 
        businesses of differing sizes, and other entities 
        (including individuals, businesses of differing sizes, 
        and other entities (including small communities and 
        governmental entities) consistent with obtaining the 
        regulatory objectives, taking into account, among other 
        things, and to the extent practicable, the costs of 
        cumulative regulations.
    The Committee concludes, therefore, that there is strong 
evidence on which to base a conclusion that Federal agencies 
charged with the handling, transportation, and disposal of 
animal fats and vegetable oils should differentiate between 
such fats and oils and other oils and greases, including 
petroleum.

                                Hearings

    The Committee on Commerce has not held hearings on the 
legislation.

                        Committee Consideration

    On September 27, 1995, the Committee ordered reported H.R. 
436, with an amendment, by voice vote, a quorum being present.

                            Roll Call Votes

    Clause 9(l)(2)(B) of rule XI of the Rules of the House 
requires the Committee to list the recorded votes on the motion 
to report legislation and on amendments thereto. There were no 
recorded votes taken in connection with ordering H.R. 436 
reported or in adopting the amendment. The voice votes taken in 
Committee are as follows:

           COMMITTEE ON COMMERCE--104TH CONGRESS VOICE VOTES

Bill

    H.R. 436, a bill to require the head of any Federal agency 
to differentiate between fats, oils, and greases of animal, 
marine, or vegetable origin, and other oils and greases, in 
issuing certain regulations, and for other purposes.

Amendment

    Amendment by Mr. Bliley re: clarifies that the bill applies 
to the transportation, storage, disposal, discharge or release 
of such oils.

Disposition

    Agreed to, by a voice vote.

Motion

    Motion by Mr. Bliley to order H.R. 436, as amended, 
reported to the House.

Disposition

    Agreed to, by a voice vote.

                      Committee Oversight Findings

    Pursuant to clause 2(l)(3)(A) of rule XI of the Rules of 
the House, the Committee has not held oversight or legislative 
hearings on this legislation.

              Committee on Government Reform and Oversight

    Pursuant to clause 2(l)(3)(D) of rule XI of the Rules of 
the House of Representatives, no oversight findings have been 
submitted to the Committee by the Committee on Government 
Reform and Oversight.

                        Committee Cost Estimate

    Under clause 7(a) of rule XIII of the Rules of the House of 
Representatives, the Committee is required to provide the 
following: (1) an estimate of the costs which would be incurred 
in carrying out this bill in the fiscal year in which it is 
reported, and in each of the five following fiscal years; (2) a 
comparison of the estimate of such costs by the Committee with 
any estimate of such costs made by any government agency and 
submitted to the Committee; and (3) when practicable, a 
comparison of the total estimated funding level for the 
relevant program with the appropriate levels under current law.
    The legislation would require the head of a Federal agency 
to differentiate between animal fats and vegetable oils and 
other oils and greases, including petroleum, when issuing or 
enforcing any regulation or establishing any interpretation or 
guideline relating to a fat, oil or grease under any Federal 
law pertaining to the transportation, storage, disposal, 
discharge, or release of that substance. The legislation does 
not impose any new rulemaking requirements on any agency. 
Therefore, the Committee estimates that compliance with this 
provision would not result in any significant additional costs 
being incurred, either in the fiscal year in which it is 
reported or in any of the five following fiscal years. The 
Committee further estimates that the legislation would not 
impose any additional costs on State and local governments.
    No other cost estimates have been submitted to the 
Committee; therefore, the Committee is unable to compare the 
Committee's cost estimate with any other cost estimate. 
Finally, the Committee believes that it is not practicable to 
compare the total estimated funding level for the relevant 
program with the appropriate levels under current law because 
the legislation applies to a broad array of programs and 
because the Committee has estimated that the legislation does 
not impose any significant additional costs.

                  Congressional Budget Office Estimate

    Pursuant to clause 2(l)(3)(C) of rule XI of the Rules of 
the House of Representatives, following is the cost estimate 
provided by the Congressional Budget Office pursuant to section 
403 of the Congressional Budget Act of 1974:

                                     U.S. Congress,
                               Congressional Budget Office,
                                Washington, DC, September 27, 1995.
Hon. Thomas J. Bliley, Jr.,
Chairman, Committee on Commerce,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
reviewed H.R. 436, a bill to require the head of any Federal 
agency to differentiate between fats, oils, and greases of 
animal, marine, or vegetable origin, and other oils and 
greases, in issuing certain regulations, and for other 
purposes, as ordered reported by Committee on Commerce on 
September 27, 1995. The bill would require the head of a 
Federal agency to apply different regulatory standards to 
classes of fats and vegetable oils and other classes of other 
oils, including petroleum oil, based on physical, chemical and 
other properties. CBO estimates that enacting H.R. 436 would 
not result in any significant cost to the Federal Government, 
and would not affect the budgets of State or local governments.
    Enactment of H.R. 436 would not affect direct spending or 
receipts. Therefore, pay-as-you-go procedures would not apply 
to the bill.
    On September 27, 1995, CBO transmitted a cost estimate for 
H.R. 436, the Edible Oil Regulatory Reform Act, as ordered 
reported by the House Committee on Agriculture on September 20, 
1995. The two bills differ in that the Agriculture Committee's 
version would change financial responsibility requirements for 
tank vessels carrying animal fat or vegetable oil. The Commerce 
Committee's version would also limit the reform to regulation 
of transportation, storage, disposal, discharge or release of 
the substance. CBO has estimated the same budgetary impact for 
both bills.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is David Hull.
            Sincerely,
                                              James L. Blum
                                   (For June E. O'Neill, Director).

                     Inflationary Impact Statement

    Pursuant to clause 2(l)(4) of rule XI of the Rules of the 
House of Representatives, the Committee finds that the bill 
would have no inflationary impact.

             Section-by-Section Analysis of the Legislation

    Section 1 provides that in issuing or enforcing any 
regulation or establishing any interpretation or guideline 
relating to a fat, oil, or grease under any Federal law 
pertaining to the transportation, storage, disposal, discharge, 
or release of that substance, the head of any Federal agency 
shall differentiate between the following: (1) animal fats and 
oils and greases, and fish and marine mammal oils, within the 
meaning of 13 U.S.C. 61(a)(2) or oils of vegetable origin, 
including oils from the seeds, nuts, and kernels referred to 13 
U.S.C. 61(a)(1); and (2) other oils and greases, including 
petroleum.
    Section 1 further provides that in differentiating between 
the classes of fats, oils, and greases described above, the 
head of the Federal agency shall consider differences in the 
physical, chemical, biological, and other properties, and in 
the environmental effects, of the classes.

                        Committee Correspondence

                                     U.S. Congress,
            Committee on Transportation and Infrastructure,
                                Washington, DC, September 27, 1995.
Hon. Thomas J. Bliley, Jr.,
Chairman, Committee on Commerce,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: I am writing to thank you for your 
cooperation regarding H.R. 436, a bill relating to the 
regulation of animal fats, vegetable oils, and other types of 
oils and greases, which your Committee ordered reported today.
    Pursuant to Rule X of the Rules of the House, H.R. 436 
directly affects provisions of statutes within the 
Transportation and Infrastructure Committee's jurisdiction. In 
fact, the Transportation and Infrastructure Committee has 
already passed language virtually identical to H.R. 436 in two 
separate contexts: section 413 of H.R. 1361, the Coast Guard 
Authorization Act for fiscal year 1996 and section 506 of H.R. 
961, the Clean Water Amendments of 1995. Each bill, including 
the animal fat/vegetable oil provisions, subsequently passed 
the House of Representatives.
    In each instance, the animal fat/vegetable oil language 
focuses on regulation under the Oil Pollution Act and the Clean 
Water Act--statutes which are under the jurisdiction of the 
Transportation and Infrastructure Committee. Over the last 
several years, the Committee has gathered testimony and other 
data indicating that the need for this legislation stems 
primarily from current or proposed regulations under these two 
Acts.
    In view of the Speaker's desire to move H.R. 436 to the 
Floor in an expeditious fashion, I do not intend to seek a 
sequential referral of the bill. However, I would appreciate 
your acknowledgement of the Transportation and Infrastructure 
Committee's jurisdiction over the bill and an acknowledgement 
of the Transportation and Infrastructure Committee's right to 
seek conferees in the event that this legislation is considered 
in a House-Senate conference. The Transportation and 
Infrastructure Committee will refrain from seeking a sequential 
referral of H.R. 436 with the understanding that you will 
continue to work with us on this legislation. However, by 
agreeing not to seek a sequential referral, the Transportation 
Committee does not waive its jurisdiction over these matters. I 
would further request that our exchange of letters on this 
matter be included in the Committee's report on H.R. 436.
    Thank you for your cooperation in this matter. I look 
forward to working with you in the future, both on this bill 
and other legislation of mutual interest to our two Committees.
    With kind personal regards, I remain
            Sincerely,
                                               Bud Shuster,
                                                          Chairman.
                                ------                                

                          House of Representatives,
                                     Committee on Commerce,
                                Washington, DC, September 27, 1995.
Hon. Bud Shuster,
Chairman, Committee on Transportation and Infrastructure,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: Thank you for you letter of September 
27, 1995, regarding H.R. 436, relating to the regulation of 
animal fats, vegetable oils, and other types of oil and 
greases.
    I appreciate the interest that the Committee on 
Transportation and Infrastructure has in this legislation. As 
your letter indicates, the Committee could be successful in 
asserting a right to a sequential referral of H.R. 436. 
Therefore, I am most appreciative of your decision not to 
request such a referral in the interest of expediting 
consideration of the bill.
    You have my assurance that agreements worked out by our 
respective staffs will be included in a manager's amendment as 
this bill is considered on the House floor. I also recognize 
your Committee's right to seek conferees on H.R. 436.
    Thank you for your cooperation in this matter and for your 
support of this legislation.
            Sincerely,
                                     Thomas J. Bliley, Jr.,
                                                          Chairman.

         Changes in Existing Law Made by the Bill, as Reported

    This legislation does not amend any existing Federal law.