[Federal Register Volume 86, Number 6 (Monday, January 11, 2021)]
[Proposed Rules]
[Pages 1890-1909]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-28585]
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ENVIRONMENTAL PROTECTION AGENCY
40 CFR Part 700
[EPA-HQ-OPPT-2020-0493; FRL-10018-40]
RIN 2070-AK64
Fees for the Administration of the Toxic Substances Control Act
(TSCA)
AGENCY: Environmental Protection Agency (EPA).
ACTION: Proposed rule.
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SUMMARY: The Environmental Protection Agency (EPA) is proposing updates
and adjustments to the 2018 fees rule established under the Toxic
Substances Control Act (TSCA). TSCA requires EPA to review and, if
necessary, adjust the fees every three years, after consultation with
parties potentially subject to fees. This document describes the
proposed modifications to the TSCA fees and fee categories for fiscal
years 2022, 2023 and 2024, and explains the methodology by which these
TSCA fees were determined. EPA is proposing to add three new fee
categories: A Bona Fide Intent to Manufacture or Import Notice, a
Notice of Commencement of Manufacture or Import, and an additional fee
associated with test orders. In addition, EPA is proposing exemptions
for entities subject to certain fee triggering activities; including:
An exemption for research and development activities, an exemption for
entities manufacturing less than 2,500 lbs. of a chemical subject to an
EPA-initiated risk evaluation fee; an exemption for manufacturers of
chemical substances produced as a non-isolated intermediate; and
exemptions for manufacturers of a chemical substance subject to an EPA-
initiated risk evaluation if the chemical substance is imported in an
article, produced as a byproduct, or produced or imported as an
impurity. EPA is updating its cost estimates for administering TSCA,
relevant information management activities and individual fee
calculation methodologies. EPA is proposing a volume-based fee
allocation for EPA-initiated risk evaluation fees in any scenario where
a consortium is not formed and is proposing to require export-only
manufacturers to pay fees for EPA-initiated risk evaluations. EPA is
also proposing various changes to the timing of certain activities
required throughout the fee payment process.
DATES: Comments must be received on or before February 25, 2021.
ADDRESSES: Submit your comments, identified by docket identification
(ID) number EPA-HQ-OPPT-2020-0493, through the Federal eRulemaking
Portal at http://www.regulations.gov. Follow the online instructions
for submitting comments. Do not submit electronically any information
you consider to be Confidential Business Information (CBI) or other
information whose disclosure is restricted by statute.
Please note that due to the public health emergency the EPA Docket
Center (EPA/DC) and Reading Room was closed to public visitors on March
31, 2020. Our EPA/DC staff will continue to provide customer service
via email, phone, and webform. For further information on EPA/DC
services, docket contact information and the current status of the EPA/
DC and Reading Room, please visit https://www.epa.gov/dockets.
FOR FURTHER INFORMATION CONTACT: For technical information contact:
Marc
[[Page 1891]]
Edmonds, Existing Chemicals Risk Management Division, Office of
Pollution Prevention and Toxics, Environmental Protection Agency, 1200
Pennsylvania Ave. NW, Washington, DC 20460-0001; telephone number:
(202) 566-0758; email address: [email protected].
For general information contact: The TSCA-Hotline, ABVI-Goodwill,
422 South Clinton Ave., Rochester, NY 14620; telephone number: (202)
554-1404; email address: TSCA/[email protected].
I. Executive Summary
A. Does this action apply to me?
You may be affected by this action if you manufacture (including
import), distribute in commerce, or process a chemical substance (or
any combination of such activities) and are required to submit
information to EPA under TSCA sections 4 or 5, or if you manufacture a
chemical substance that is the subject of a risk evaluation under TSCA
section 6(b). The following list of North American Industry
Classification System (NAICS) codes is not intended to be exhaustive,
but rather provides a guide to help readers determine whether this
document applies to them.
Potentially affected entities may include companies found in major
NAICS groups:
Chemical Manufacturers (NAICS code 325).
Petroleum and Coal Products (NAICS code 324).
Chemical, Petroleum and Merchant Wholesalers (NAICS code
424).
If you have any questions regarding the applicability of this
action, please consult the technical person listed under FOR FURTHER
INFORMATION CONTACT.
B. What is the Agency's authority for taking this action?
TSCA, 15 U.S.C. 2601 et seq., as amended by the Frank R. Lautenberg
Chemical Safety for the 21st Century Act of 2016 (Pub. L. 114-182)
(Ref. 1), provides EPA with authority to establish fees to defray a
portion of the costs associated with administering TSCA sections 4, 5,
and 6, as amended, as well as the costs of collecting, processing,
reviewing, and providing access to and protecting from disclosure as
appropriate under TSCA section 14 information on chemical substances
under TSCA. EPA is required in TSCA section 26(b)(4)(F) to review and,
if necessary, adjust the fees every three years, after consultation
with parties potentially subject to fees, to ensure that funds are
sufficient to defray part of the cost of administering TSCA. EPA is
issuing this proposed rule under TSCA section 26(b), 15 U.S.C. 2625(b).
C. What action is the Agency taking?
Pursuant to TSCA section 26(b), EPA is issuing this proposed rule
to establish, update and/or revise fees collected from manufacturers
(including importers) and, in some cases, processors, to defray some of
the Agency's costs related to activities under TSCA sections 4, 5, and
6, and collecting, processing, reviewing, and providing access to and
protecting from disclosure as appropriate under TSCA section 14
information on chemical substances. EPA is proposing updates and
changes to the 2018 Fee Rule (Ref. 2), including: (a) The addition of
three new fee categories--a Bona Fide Intent to Manufacture or Import
Notice (bona fide notice), Notice of Commencement of Manufacture or
Import (NOC), and an additional fee related to test orders; (b) The
addition of exemptions for manufacturers subject to fees for EPA-
initiated risk evaluations under TSCA section 6(b), including:
Exemptions for manufacturers if the chemical substance is imported in
an article, produced as a byproduct, or produced or imported as an
impurity (as discussed in the March 25, 2020 EPA Press Release
announcing its plan and summarized at https://www.epa.gov/tsca-fees/information-plan-reduce-tsca-fees-burden-and-no-action-assurance (Ref.
3)), an exemption for research and development activities, an exemption
for manufacturers of chemical substances produced as a non-isolated
intermediate, and an exemption for entities manufacturing less than
2,500 lbs. of a chemical; (c) Updates to TSCA sections 4, 5, and 6
costs and costs of relevant information management activities as well
as fee calculation methodology; and (d) Various changes to how the fee
regulations are implemented including certain timing requirements
throughout the fee payment process. EPA is not proposing to change the
``small business concerns'' definition. Although EPA is required to
review and, if necessary, amend the TSCA fees every three years, EPA
may propose additional amendments to TSCA fees, when warranted, based
on its experience with implementing the requirements or analysis of
future cost and revenue data.
D. Why is the Agency taking this action?
The proposed fees are intended to achieve the goals articulated by
Congress by providing a sustainable source of funds for EPA to fulfill
its legal obligations under TSCA sections 4, 5, and 6 and with respect
to information management. These activities include designating
applicable substances as High- and Low-Priority for future risk
evaluation, conducting risk evaluations to determine whether a chemical
substance presents an unreasonable risk of injury to health or the
environment, requiring testing of chemical substances and mixtures, and
evaluating and reviewing new chemical submissions, as required under
TSCA sections 4, 5 and 6, as well as collecting, processing, reviewing,
and providing access to and protecting from disclosure as appropriate
under TSCA section 14 information on chemical substances under TSCA.
EPA reviewed fees established in the 2018 Fee Rule and determined that
it is necessary to adjust the fees. EPA is proposing changes to the
TSCA fee requirements established in the 2018 Fee Rule based upon over
two years of TSCA fee implementation and is proposing to adjust the
fees based on changes to program costs and inflation and address
certain issues related to implementation of the fee requirements.
E. What are the estimated incremental impacts of this action?
EPA has evaluated the potential incremental economic impacts of
this proposed rule for FY 2022 through FY 2024. The ``Economic Analysis
of the Proposed Rule for Fees for the Administration of the Toxic
Substances Control Act'' (Economic Analysis) (Ref. 4), which is
available in the docket, is discussed in Unit IV., and is briefly
summarized here.
1. Benefits. The principal benefit of the proposed rule is to
provide EPA a sustainable source of funding necessary to administer
certain provisions of TSCA.
2. Cost. The fees collected from industry for this proposed rule
under the proposed options, annualized over the period from fiscal year
2022-2024, are approximately $22 million (at both 3% and 7% discount
rates), excluding fees collected for manufacturer-requested risk
evaluations. Total annualized fee collection was calculated by
multiplying the estimated number of fee-triggering events anticipated
each year by the corresponding fees. Total annual fee collection for
manufacturer-requested risk evaluations is estimated to be $1.9 million
for chemicals included in the 2014 TSCA Work Plan (TSCA Work Plan)
(based on two requests over the three-year period) and approximately
$5.7 million for chemicals not included in the TSCA Work Plan (based on
three requests over the three-year period) (Ref. 4). EPA analyzed a
three-year period because the
[[Page 1892]]
statute requires EPA to reevaluate and adjust, as necessary, the fees
every three years.
3. Small entity impact. EPA estimates that 35% of section 5
submissions will be from small businesses that are eligible to pay the
section 5 small business fee because they meet the definition of
``small business concern.'' ``Small business concern'' means a
manufacturer or processor who meets the size standards at 40 CFR
700.43. Total annualized fee collection from small businesses
submitting notices under section 5 is estimated to be $411,000 (Ref.
4). For sections 4 and 6, reduced fees paid by eligible small
businesses and fees paid by non-small businesses may differ because the
fee paid by each entity would be dependent on the number of entities
identified per fee-triggering event and production volume of that
chemical substance. EPA estimates that average annual fee collection
from small businesses for fee-triggering events under section 4 and
section 6 would be approximately $8,000 and $922,000, respectively. For
each of the three years covered by this proposed rule, EPA estimates
that total fee revenue collected from small businesses will account for
about 6 percent of the approximately $22 million total fee collection,
for an annual average total of approximately $1.3 million.
4. Environmental justice. The fees will enable the Agency to better
protect human health and the environment, including in low-income and
minority communities.
5. Effects on State, local, and Tribal governments. The rule would
not have any significant or unique effects on small governments, or
federalism or tribal implications.
F. What should I consider as I prepare my comments for EPA?
1. Submitting CBI. Do not submit this information to EPA through
http://www.regulations.gov or email. Clearly mark the part or all of
the information that you claim to be CBI. For CBI information in a disk
or CD-ROM that you mail to EPA, mark the outside of the disk or CD-ROM
as CBI and then identify electronically within the disk or CD-ROM the
specific information that is claimed as CBI. In addition to one
complete version of the comment that includes information claimed as
CBI, a copy of the comment that does not contain the information
claimed as CBI must be submitted for inclusion in the public docket.
Information so marked will not be disclosed except in accordance with
procedures set forth in 40 CFR part 2.
2. Tips for preparing your comments. When preparing and submitting
your comments, see the commenting tips at http://www.epa.gov/dockets/comments.html.
II. Background
A. Statutory Requirements for TSCA Fees
The proposed Fee Rule (83 FR 8212, February 26, 2018) (FRL-9974-31)
provides a robust overview of the history of fees under TSCA and the
2016 amendments to TSCA. TSCA authorizes EPA to establish, by rule,
fees for certain fee-triggering activities under TSCA sections 4, 5 and
6. In so doing, the Agency must set lower fees for small business
concerns and establish the fees at a level such that they will offset
25% of the Agency's costs to carry out a broader set of activities
under sections 4, 5, and 6 and relevant information management
activities. In addition, in the case of manufacturer-requested risk
evaluations, the Agency is directed to establish fees sufficient to
defray 50% of the costs associated with conducting a manufacturer-
requested risk evaluation on a chemical included in the TSCA Work Plan
for Chemical Assessments: 2014 Update, and 100% of the costs of
conducting a manufacturer-requested risk evaluation for all other
chemicals. EPA is also required in TSCA section 26(b)(4)(F) to review
and adjust, as necessary, the fees every three years. EPA is fulfilling
that obligation with this rulemaking.
B. History of TSCA Fees
On October 17, 2018, EPA finalized the TSCA Fee Rule (Ref. 2),
following the issuance of a proposed Fee Rule on February 26, 2018 and
a 60-day comment period. As required by TSCA 26(b)(4)(E), EPA also
consulted and met with stakeholders that were potentially subject to
fees, including as part of several meetings with individual
stakeholders through the development of the final rule.
In the 2018 Fee Rule, EPA established eight distinct fee
categories: (1) Test orders, (2) test rules and (3) enforceable consent
agreements (ECA), all under TSCA section 4; (4) notices and (5)
exemptions, both under TSCA section 5; and (6) EPA-initiated risk
evaluations, (7) manufacturer-requested risk evaluations for chemicals
on the TSCA Work Plan, and (8) manufacturer-requested risk evaluations
for chemicals not on the TSCA Work Plan, all under TSCA section 6. The
activities in these categories are fee-triggering events that result in
obligations to pay fees.
In addition, EPA established standards for determining which
persons qualify as ``small business concerns'' and thus would be
subject to lower fee payments. As discussed in the 2018 Fees Rule, EPA
adopted an employee-based size standard modeled after the SBA's
standards. EPA is not proposing to change the ``small business
concerns'' definition in this rule.
EPA calculated fees by estimating the total annual costs of
carrying out relevant activities under TSCA sections 4, 5, and 6
(excluding the costs of manufacturer-requested risk evaluations) and
conducting relevant information management activities; identifying the
full cost amount to be defrayed by fees under TSCA section 26(b) (i.e.,
25% of those annual costs); and allocating that amount across the fee-
triggering events in TSCA sections 4, 5, and 6, weighted more heavily
toward TSCA section 6 based on early industry feedback. EPA afforded
small businesses an approximate 80% discount, in accordance with TSCA
section 26(b)(4)(A), and established, for the two fee-triggering events
where manufacturers would not already be self-identified (TSCA section
4 test rules and TSCA section 6 EPA-initiated risk evaluations), a
process to identify manufacturers (including importers) subject to
these fees.
At the time of promulgation of the 2018 Fee Rule, EPA had many new
responsibilities under amended TSCA and relatively little information
and experience to inform assumptions on costs or activity levels. EPA
has gained valuable experience over two years of implementing the
initial fee structure and has used this initial experience and
information gained from tracking actual costs to refine methodologies
for calculating fees and to inform the development of proposed
revisions to the fee structure. These proposed updates are discussed in
Unit III. Additional discussion on the updates to program cost
estimates is discussed in Unit II.C.
C. Program Cost Estimates and Activity Assumptions
The estimated annual Agency costs of carrying out relevant
activities under TSCA sections 4, 5, and 6 and relevant information
management activities are based on cost data from fiscal years 2019 and
2020 which are the first full fiscal years after EPA implemented a time
reporting system that tracks employee hours worked on administering
TSCA. Total Agency costs of carrying out those relevant activities are
estimated at approximately $87.5 million each year. Based on these cost
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estimates, EPA anticipates collecting approximately $22 million in fees
collected from all fee-triggering events, except manufacturer-requested
risk evaluations. In addition, the Agency intends to collect fees to
recover 50% or 100% of the actual costs incurred by EPA in conducting
chemical risk evaluations requested by manufacturers, depending on
whether the chemical substance is included in the TSCA Work Plan. EPA
expects the amount collected will be approximately $2.84 million per
chemical for chemicals on the TSCA Work Plan and $5.67 million per
chemical for chemicals not on the TSCA Work Plan.
EPA determined the anticipated costs associated with relevant
activities under TSCA sections 4, 5, and 6 and relevant information
management activities, including both direct program costs and indirect
costs (see Table 1). For fiscal year 2022 through fiscal year 2024,
these costs were estimated to be approximately $87.5 million per year.
Table 1--Estimated Annual Costs to EPA
[Fiscal year 2022 through fiscal year 2024]
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Annual costs
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TSCA section 4.......................................... $3,543,000
TSCA section 5.......................................... 34,713,248
TSCA section 6.......................................... 41,998,820
TSCA section 8.......................................... 3,974,522
TSCA section 14......................................... 1,873,443
Other sections.......................................... 1,432,967
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Total............................................... 87,536,000
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Table Note: Numbers may not add due to rounding. The indirect cost rate
is estimated at 19.5% for the purposes of this analysis.
After estimating the annual costs of administering relevant
activities under TSCA sections 4, 5, and 6 and relevant information
management activities, the Agency had to determine how the costs would
be allocated over the narrower set of activities under TSCA sections 4,
5 and 6 that trigger a fee. The Agency took an approach to determining
fees that tied the payment of fees to individual distinct activity
types or ``fee-triggering events''. This allows allocation of costs
more equitably among the activity types and their related costs.
1. Program Costs
To determine the program costs for implementing relevant activities
under TSCA sections 4, 5, and 6 and relevant information management
activities, the Agency accounted for the intramural and extramural
costs for those activities.
Intramural costs are those costs related to the efforts exerted by
EPA staff and management in operating the program, collecting and
processing information and funds, conducting reviews, and related
activities. Extramural costs are those costs related to the acquisition
of contractors to conduct activities such as analyzing data, developing
IT systems and supporting the TSCA Help Desk.
The Agency then added indirect costs to the direct program cost
estimates. The Agency used an indirect cost rate of 19.5% to calculate
the indirect costs associated with all direct program cost estimates
for TSCA sections 4, 5, and 6 and relevant information management
activities.
a. TSCA Section 4 Program Costs
TSCA section 4 gives EPA the authority to require (by rule, order,
or ECA) manufacturers and processors to conduct testing of identified
chemical substances or mixtures. EPA plans to utilize section 4
authorities in connection with the development of section 6(b) risk
evaluations which would affect the number of section 4 rules, orders,
and ECAs that may be underway at any given time. These activity level
assumptions represent EPA's best professional judgment on how the
program will be implemented. EPA estimates that, on average, it will
undertake work associated with 10 test orders, one test rule and one
ECA each year. While EPA expects to work on one test rule and one ECA
each year, EPA expects to initiate each of these activities about every
other year as it takes approximately two years to complete the work
associated with both activities.
EPA estimated TSCA section 4 costs based on prior experience with
developing test orders, test rules and ECAs, with consideration given
to the information needs under amended TSCA for section 4 activities.
Specifically, costs were based on: The Agency's general experience with
the rulemaking process; experience with developing an ECA for
Octamethylcyclotetrasiloxane (D4); costs associated with reviewing
study plans and information received; administration of the High
Production Volume Voluntary Testing Program; and information from the
development of one test order for pigment violet 29.
EPA's cost estimates included a full suite of activities related to
developing and implementing actions under TSCA section 4 authorities
including reviewing screening-level hazard and environmental fate
information submitted in response to a section 4 rule, order, or ECA,
such as tests that provide information on the toxicity of a chemical
(e.g., aquatic toxicity, and mammalian toxicity) or occupational
monitoring data. EPA also included estimates of the costs of reviewing
physical/chemical properties and environmental fate and pathways data
and tests.
Based on previous experience and expected work under TSCA as
amended, EPA assumes that testing required by test orders is likely to
be completed in under a year, and test rules and ECAs are likely to
take two years to complete. To estimate the costs of reviewing test
data, we assume that, on average, data will be submitted to EPA to
conduct 10 test orders per year over the course of a three-year period,
with approximately 120 companies potentially subject to the orders.
Unlike activities conducted under sections 5 and 6, EPA does not
have enough data on actual implementation costs with which to base
future cost estimates. As a result, EPA is relying on the section 4
cost estimate from the 2018 Fees Rule. Based on this approach, the
estimated cost to the Agency of each test order is approximately
$279,000. Each test rule is estimated to cost approximately $844,000
and each ECA is estimated to cost approximately $652,000. These cost
estimates include submission review and are based on projected full-
time equivalent (FTE) and extramural support needed for each activity
divided by the number of orders, rules and ECAs that EPA assumes will
be issued over a three-year period. As noted earlier, several of these
activities (rules and ECAs) are expected to span two years, so those
estimates are based on the annual estimated costs multiplied by two.
The annual cost estimate of administering TSCA section 4 in fiscal year
2022 through fiscal year 2024 is $3,543,000.
b. TSCA Section 5 Program Costs
TSCA section 5 requires that manufacturers and processors provide
EPA with notice before initiating the manufacture of a new chemical
substance or initiating the manufacturing or processing for a
significant new use of a chemical substance. Examples of the notices or
other information that manufacturers and processors are required to
submit under TSCA section 5 are premanufacture notices (PMNs),
significant new use notifications (SNUNs), microbial commercial
activity notices (MCANs), and exemption notices and applications
including low-volume exemptions (LVEs), test-marketing exemptions
(TMEs), low exposure/low release exemptions (LoREXs), TSCA experimental
release
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applications (TERAs), certain new microorganism (Tier II) exemptions,
and film article exemptions. EPA is required to review and make a
determination on whether the chemical presents an unreasonable risk of
injury to health or the environment and take risk management action, as
needed. Recent data on the number of annual submissions is found at
https://www.epa.gov/reviewing-new-chemicals-under-toxic-substances-control-act-tsca/statistics-new-chemicals-review.
EPA estimates that it will receive 301 PMNs, SNUNs and MCANs per
year, and another 320 exemption notices and applications per year, most
of which are LVEs. EPA used the average number of section 5 submissions
received in FY2019 and FY 2020 for each category of submission as the
estimate of the annual number of submissions per section 5 fee category
for the next three years. Cost estimates were developed based on
information from the Agency's time reporting system that tracks
employee hours and contract expenditures for administering TSCA section
5 in FY 2019 and FY 2020.
EPA's cost estimates for administering TSCA section 5 also include
the costs associated with processing and retaining records related to a
Notice of Commencement of Manufacture or Import (NOC) submission. NOC
costs also include the cost of registering the chemical with the
Chemical Abstracts Service. EPA has lumped the costs associated with
NOCs with those of PMNs, MCANs, and SNUNs. Estimated costs associated
with TSCA section 5 exemption notices and applications include the
costs of pre-notice consultations, processing and reviewing
applications, retaining records, and related activities. This estimate
is based on projected FTE and extramural support needed for these
actions divided by the number of submissions the Agency assumes will be
received each year.
The annual cost estimate of administering TSCA section 5 in fiscal
year 2022 through fiscal year 2024 is $34,713,248 and is attributed to
PMNs, SNUNs and MCANs as well as section 5 exemption notices and
applications for LVEs, LoREXs, TMEs, TERAs, Tier II exemptions and film
article exemptions.
c. TSCA Section 6 Program Costs
TSCA section 6 directs the EPA to establish a process for assessing
and managing existing chemical substances under TSCA. TSCA section 6
addresses: (a) Prioritizing chemicals for evaluation; (b) Evaluating
risks from chemicals; and (c) Addressing unreasonable risks identified
through the risk evaluation. Under TSCA, EPA is required to regularly
undertake a risk-based prioritization process to designate existing
chemicals on the TSCA Inventory as either high-priority for risk
evaluation or low-priority. For chemicals designated as High-Priority
Substances, as well as certain chemicals not subject to prioritization,
such as those in manufacturer-requested risk evaluations, EPA must
evaluate those chemicals to determine whether they present an
unreasonable risk of injury to health or the environment under the
conditions of use. The first step in the risk evaluation process, as
outlined in TSCA, is to issue a scoping document for each chemical
substance within six months of initiation of the risk evaluation (e.g.,
designation of a High-Priority Substance as announced in the Federal
Register). The scoping document includes information about the chemical
substance, such as conditions of use, hazards, exposures, and
potentially exposed or susceptible subpopulations that the Agency
expects to consider in the risk evaluation. TSCA requires that these
chemical risk evaluations be completed within three years of
initiation, allowing for a 6-month extension. During the Risk
Evaluation scoping process, EPA will identify the ``conditions of use''
that the Agency expects to consider during the evaluation. If EPA
determines that a chemical substance presents unreasonable risk under
its conditions of use, EPA must proceed to risk management action under
TSCA section 6(a). For each risk evaluation that the Agency completes
(other than a manufacturer-requested risk evaluation), TSCA requires
that EPA identify another High-Priority Substance. The Agency expects
to have at least 20 risk evaluations (other than manufacturer-requested
risk evaluations) ongoing at any time in any given year at different
stages in the evaluation process.
TSCA section 6 cost estimates have been informed: By the Agency's
experience conducting and in some cases completing evaluations for the
first 10 chemicals undergoing risk evaluation under amended TSCA, which
consist of 1,4 dioxane, 1-bromopropane, asbestos, carbon tetrachloride,
cyclic aliphatic bromide cluster (HBCD), methylene chloride, N-
methylpyrrolidone, pigment violet 29, trichloroethylene, and
tetrachloroethylene; by the Agency's experience developing the scope of
the risk evaluations of the 20 chemicals designated as high-priority in
December 2019; and by the Agency's experience with risk management
actions addressing unreasonable risks identified from particular
chemical activities. TSCA section 6 risk evaluations include the cost
of information gathering (distinct from data collection via section 4),
evaluating human and environmental hazards and environmental fate, and
conducting exposure assessments. Costs also include the use of the
ECOTOX knowledge and Health and Environmental Research Online (HERO)
databases, scoping, developing and publishing the draft risk
evaluation, conducting and responding to peer review and public
comment, and developing the final evaluation, which includes risk
determinations.
Under TSCA section 6, the Agency also must take action to address
the unreasonable risks identified during risk evaluation. Cost
estimates for risk management activities have been informed, in part,
by EPA's recent risk management actions on several chemicals, including
development of the proposed rules regarding the use of N-
methylpyrrolidone and methylene chloride in paint and coating removal,
and the use of trichloroethylene in both commercial vapor and aerosol
degreasing and for spot cleaning in dry cleaning facilities, and the
development of the final rule regarding methylene chloride in consumer
paint and coating removal.
The estimated annual cost to EPA of administering relevant
activities under TSCA section 6 in fiscal year 2022 through 2024 is
$41,998,820. The costs are attributed to risk evaluation work on
chemical risk evaluations (other than manufacturer-requested risk
evaluations); risk management efforts; support from the Office of
Research and Development (ORD) for alternative animal testing and
methods development and enhancement, data integration, meta-analysis of
studies, and providing access to other models, tools and information
already developed by ORD; and the process of prioritizing chemical
substances.
d. Costs of Collecting, Processing, Reviewing, and Providing Access to
and Protecting From Disclosure as Appropriate Under TSCA Section 14
Information on Chemical Substances
EPA's cost estimates include the costs of information management
for sections 4, 5, 6 and 14 but do not include the costs of
administering other authorities for collection such as those in TSCA
section 8 and 11. EPA does not believe that Congress intended EPA to
offset costs associated with administering authorities under these
other sections. The statutory text clearly points to the
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authorities of TSCA sections 4, 5, 6 and 14. If the costs of
administering activities under TSCA sections 8 and 11 were intended to
be defrayed with fees, Congress would have specifically included those
authorities in the statutory text. Cost estimates in the proposed rule
consider costs associated with managing information that, for instance,
was received pursuant to a TSCA section 8 rule but not the costs of
developing the TSCA section 8 rule.
Specific activities considered when developing this estimate for
activities under section 14 include: Prescreening/initial review;
substantive review and making final determinations; documents review
and sanitization; regulation development; IT systems development; and
transparency/communications. Estimates also include Office of General
Counsel costs associated with coordinating, reviewing, issuing, and
defending TSCA CBI claim final determinations, and supporting guidance,
policy and regulation development for TSCA section 14 activities, e.g.,
implementing the unique identifier provisions, ensuring access to TSCA
CBI for emergency personnel, states, tribes and local governments, and
developing the TSCA CBI sunset provisions, among others.
Other chemical information management activities included in the
analysis are: Costs for implementing the requirements in TSCA section
14(d); costs for implementing the CBI sunset requirements; costs for
Notice of Activity chemical identity CBI claim reviews; costs for
Freedom of Information Act-Related CBI claim reviews; costs for
providing public access to Non-CBI Data; and IT costs for operating and
maintaining the CBI Local Area Network (LAN). The annual cost estimate
of collecting, processing, reviewing, and providing access to and
protecting from disclosure as appropriate information on chemical
substances under section 14 of TSCA, including FTE and extramural
costs, from fiscal year 2022 through fiscal year 2024 is $1,873,443
(Ref. 4).
2. Indirect Costs
Indirect costs are the intramural and extramural costs that are not
accounted for in the direct program costs, but are important to capture
because of their necessary enabling and supporting nature, and so that
EPA's proposed fees will accomplish full cost recovery up to that
provided by law. Indirect costs typically include such cost items as
accounting, budgeting, payroll preparation, personnel services,
purchasing, centralized data processing, and rent.
Indirect costs are disparate and more difficult to track than the
other cost categories, because they are typically incurred as part of
the normal flow of work (e.g., briefings and decision meetings
involving upper management) at many offices across the Agency. EPA
accounts for some indirect costs in the costs associated with carrying
out relevant activities under TSCA sections 4, 5, and 6, and costs of
collecting, processing, reviewing, and providing access to and
protecting from disclosure as appropriate under TSCA section 14
information on chemical substances, by the inclusion of an indirect
cost factor. This rate is multiplied by and then added to the program
costs. An indirect cost rate is determined annually according to EPA's
indirect cost methodology and as required by Federal Accounting
Standards Advisory Board's Statement of Federal Financial Accounting
Standards No. 4: Managerial Cost Accounting Standards and Concepts. An
indirect cost rate of 19.5% was applied to direct program costs of work
conducted by EPA's Office of Chemical Safety and Pollution Prevention,
based on FY 2019 data. Some of the direct program costs included in the
estimates for TSCA sections 4, 5, and 6 and collecting, processing,
reviewing, and providing access to and protecting from disclosure as
appropriate under TSCA section 14 information on chemical substances
are for work performed in other Agency offices (e.g., the Office of
Research and Development and the Office of General Counsel).
Appropriate indirect cost rates were applied to those cost estimates
and are based on EPA's existing indirect cost methodology. Indirect
cost rates are calculated each year and therefore subject to change.
Indirect costs were included in the program cost estimates in the
previous sections.
3. Total Costs of Fee-Triggering Events
The annual estimated costs for fee categories under TSCA section 4,
including both direct and indirect program costs, are shown in Table 2.
Note that the costs presented in Tables 2, 3, and 4 include only the
costs of fee- triggering events and so do not include costs associated
with activities such as CBI reviews, alternative testing methods
development, risk management for existing chemicals, or prioritization
of existing chemicals. Costs associated with those activities are part
of the overall costs of administering relevant activities under TSCA
sections 4, 5, and 6 and relevant information management activities
and, as such, are included in the overall cost estimates provided
previously in Table 1.
Table 2--TSCA Section 4 Costs *
----------------------------------------------------------------------------------------------------------------
Estimated
number of Estimated cost Estimated
Fee category ongoing to Agency/ annual cost to
actions/year action Agency
----------------------------------------------------------------------------------------------------------------
Test Order...................................................... 10 $279,000 $2,795,000
Test Rule....................................................... 1 844,000 422,000
Enforceable Consent Agreement................................... 1 652,000 326,000
----------------------------------------------------------------------------------------------------------------
* Table Note: Numbers may not add due to rounding.
The estimated annual costs for fee categories under TSCA section 5,
including both direct and indirect program costs are shown in Table 3.
[[Page 1896]]
Table 3--TSCA Section 5 Costs *
------------------------------------------------------------------------
Estimated Total
number of estimated
Fee category ongoing annual cost to
actions/year Agency
------------------------------------------------------------------------
PMN and consolidated PMN, SNUN, MCAN and 301 ..............
consolidated MCAN......................
Bona Fide Notice........................ 207
Notice of Commencement.................. 175
LoREX, LVE, TME, Tier II exemption, 320
TERA, Film Article.....................
-------------------------------
$34,713,428
------------------------------------------------------------------------
* Table Note: Numbers may not add due to rounding. Costs were not broken
out and therefore are not shown in the Total estimated annual cost to
Agency column.
The estimated annual costs for fee categories under TSCA section 6,
including both program and indirect costs are shown in Table 4.
Table 4--TSCA Section 6 Costs *
----------------------------------------------------------------------------------------------------------------
Estimated
number of Estimated Estimated
Fee category ongoing cost to annual cost
actions/year Agency/action to Agency
----------------------------------------------------------------------------------------------------------------
EPA-initiated risk evaluation................................... 20 $5,671,000 $41,998,820
Manufacturer-requested risk evaluation: Work Plan chemical...... 2 5,671,000 3,783,000
Manufacturer-requested risk evaluation: Non-Work Plan chemical.. 3 5,671,000 5,671,000
----------------------------------------------------------------------------------------------------------------
* Table Note: Numbers may not add due to rounding.
III. Overview of the Proposed Rule
A. Regulatory Approach
Pursuant to TSCA section 26(b), EPA is issuing this proposed rule
to update and revise the fee collection from manufacturers (including
importers) and, in some cases, processors, to defray approximately 25%
of the Agency's costs related to relevant activities under TSCA
sections 4, 5, and 6, and relevant information management activities.
The proposed rule applies to manufacturers and processors who are
required to submit information under TSCA section 4, manufacturers and
processors who submit certain notices and exemptions under TSCA section
5, and manufacturers who are subject to risk evaluation under TSCA
section 6(b), including manufacturers who submit requests for risk
evaluation under TSCA section 6(b)(4)(C)(ii).
1. Stakeholder Engagement
Under TSCA section 26(b)(4)(E), EPA is required to consult and meet
with parties potentially subject to the fees or their representatives
prior to establishment or amendment of TSCA fees. Similarly, under TSCA
section 26(b)(4)(F), EPA is required to adjust the fees as necessary
every three years after consulting with parties potentially subject to
the fees and their representatives. Since the 2018 Fee Rule, EPA has
held several outreach meetings with industry stakeholders on
implementation issues. All of these outreach meetings are summarized at
https://www.epa.gov/tsca-fees/outreach-materials-tsca-administration-fees-rule. In fall and winter 2019, EPA held a series of webinars with
industry to explain changes to EPA's Central Data Exchange (CDX) and
how to pay fees through the system. In December 2019, EPA hosted a
conference call to give a brief overview of the fees associated with an
EPA-initiated risk evaluation, the creation of the preliminary list
that identifies manufacturers and importers subject to fees, and how
fees would be divided among the identified businesses. On February 24,
2020, EPA hosted a conference call to review certain provisions of the
2018 Fee Rule. On April 16, 2020, EPA hosted a call to discuss a
decision to reduce burden for certain stakeholders subject to TSCA Fee
Rule requirements for EPA-initiated risk evaluations via a No Action
Assurance for enforcement of certain provisions of the 2018 Fee Rule.
EPA is committed to continued stakeholder outreach and intends to
meet with companies, trade associations and consortia that represent
affected manufacturers and processors. EPA will also consult with the
Small Business Administration regarding engagement with small
businesses.
2. Request for Comment on Proposed and Alternative Regulatory Actions
EPA requests comment on all aspects of the proposed and alternative
regulatory actions discussed in this unit, including comment on whether
the proposed regulatory actions would improve fee collection processes
and ensure fair fee distribution among fee payers. EPA is also seeking
additional information and data that could facilitate EPA's further
evaluation of the potentially affected industries and firms, including
data related to potential impacts on those small businesses that would
be subject to fees.
B. Methodology for Calculating Fees
1. Description of the Proposed Regulatory Action
EPA does not implement an actual cost approach for TSCA sections 4,
5, and 6 (excluding the costs of manufacturer-requested risk
evaluations) fee-triggering events and is not proposing to do so
through this proposed rule. EPA does, however, implement an actual cost
approach for calculating fees for manufacturer-requested risk
evaluations. Specifically, EPA currently requires an initial payment of
$1,250,000 (for a chemical on the TSCA Work Plan) or $2,500,000 (for a
chemical not on the TSCA Work Plan), and a final invoice to total
either 50% or 100% of the remaining actual costs in line with the
percentage
[[Page 1897]]
requirements in TSCA, or a refund to achieve these requirements, if
warranted.
The 2018 Fee Rule established a two-payment approach for
manufacture-requested risk evaluations--an initial payment, followed by
a final invoice at the conclusion of the risk evaluation for the total
remaining due, or a refund to achieve these requirements, if warranted.
EPA is proposing a change to this approach by proposing a payment plan
that enables entities to pay approximately \1/3\ each year with a final
invoice at the conclusion of the risk evaluation. Specifically, EPA is
proposing to allow an initial payment of $945,000 and a second payment
by the end of the second year of $945,000 (for a chemical on the TSCA
Work Plan) or an initial payment of $1,890,000 and a second payment of
$1,890,000 by the end of the second year (for a chemical not on the
TSCA Work Plan), followed by a final invoice at the conclusion of the
risk evaluation, or a refund, if warranted.
EPA is proposing this change to allow manufacturers to budget and
better prepare for paying the manufacture-requested risk evaluation
fees. These fee payments are in line with the estimated cost of a
manufacturer-requested risk evaluation of approximately $5,671,000. EPA
is requesting comments on the proposed modifications to the payment
plan.
EPA is also proposing changes to how EPA would allocate fees for
EPA-initiated risk evaluations under TSCA section 6. Specifically, EPA
is proposing to reallocate the remaining fee, after allocating the fees
for small businesses, across the remaining manufacturers based on their
percentage of total volume produced of that chemical minus the amount
produced by the small businesses. This differs from the 2018 Fee Rule
allocation by considering volume produced. EPA believes this approach
for calculating TSCA section 6 fee allocations will result in a more
representative distribution of fees and better account for the wide
variation in production volume sometimes associated with a particular
chemical substance.
In any scenario where there is not a single consortium comprised of
all manufacturers of the chemical undergoing the EPA-initiated risk
evaluation, EPA would take the following steps to allocate fees:
Count the total number of manufacturers, including the
number of manufacturers within any consortia.
Divide the total fee amount by the total number of
manufacturers to generate a base fee.
Provide all small businesses who are either (a) not
associated with a consortium, or (b) associated with an all-small
business consortium, with an 80% discount from the base fee referenced
previously.
Calculate the total fee amount to be split among the total
number of small manufacturers and distribute it based on their
percentage of the average annual production volume from the four
calendar years prior to the year certification was made.
Calculate the total remaining fee amount to be split among
the total number of remaining manufacturers by subtracting out the
discounted fees and the number of small businesses identified.
Reallocate the remaining fee across those remaining
manufacturers based on their percentage of average annual production
volume from the four calendar years prior to the year certification was
made minus the amount produced by the small businesses, counting each
manufacturer in a consortium as one person.
EPA is not proposing these calculation and methodology changes for
the fee allocations under TSCA section 4 activities. Fees for section 4
activities are significantly lower than those for a risk evaluation
and, therefore, less burdensome, obviating the need to allocate the
fees based on production volume.
Table 5--Proposed Changes to TSCA Section 6(b) Fee Allocations
------------------------------------------------------------------------
2018 Fee rule 2020 Proposed fee rule
------------------------------------------------------------------------
In any scenario where there is not a In any scenario where there is
single consortium comprised of all not a single consortium
manufacturers of the chemical comprised of all manufacturers
undergoing the EPA-initiated risk of the chemical undergoing the
evaluation, EPA will take the EPA-initiated risk evaluation,
following steps to allocate fees: EPA will take the following
steps to allocate fees:
Count the total number of Count the total
manufacturers, including the number of manufacturers,
number of manufacturers within any including the number of
consortia. manufacturers within any
consortia.
Divide the total fee Divide the total
amount by the total number of fee amount by the total
manufacturers and allocate equally number of manufacturers to
on a per capita basis to generate generate a base fee for the
a base fee. purpose of calculating the
fee for small businesses.
Provide all small Provide all small
businesses who are either (a) not businesses who are either
associated with a consortium, or (a) not associated with a
(b) associated with an all-small consortium, or (b)
business consortium with an 80% associated with an all-
discount from the base fee small business consortium,
referenced previously. with an 80% discount from
the base fee referenced
previously.
Calculate the total Calculate the total
remaining fee and total number of fee amount to be split
remaining manufacturers by among the total number of
subtracting out the discounted small manufacturers and
fees and the number of small distribute it based on
businesses identified. their percentage of the
average annual production
volume from the four
calendar years prior to the
year certification was
made.
Reallocate the remaining Calculate the total
fee across those remaining remaining fee amount to be
individuals and groups in equal split among the total
amounts, counting each number of remaining
manufacturer in a consortium as manufacturers by
one person. subtracting out the
discounted fees and the
number of small businesses
identified.
Reallocate the
remaining fee across those
remaining manufacturers based
on their percentage of average
annual production volume from
the four calendar years prior
to the year certification was
made minus the amount produced
by the small businesses,
counting each manufacturer in
a consortium as one person.
------------------------------------------------------------------------
EPA recognizes that the incorporation of production volume into the
fee calculation methodologies changes the current relationship between
individual small business fees and other manufacturer fees and may even
result in some small businesses paying higher fees if they produce
significantly more than other manufacturers, dependent on
[[Page 1898]]
the number of entities identified per fee-triggering event and their
production volume of that chemical substance. EPA is requesting
comments on this proposed methodology, how it impacts the small
business fee payments, and whether caps for fees for small business
entities should be considered.
EPA requests comment on the use of production volume and the
methodology used in assigning fee amounts in TSCA section 6 activities.
EPA is requesting comment on EPA's proposed calculation using
production volume to determine fee allocations (i.e., the average
annual production volume from the four calendar years prior to the year
certification was made). Additional information on the fee amounts can
be found in Unit III.G.
Lastly, EPA is proposing modifications to the time allowed for
payment established under the 2018 Fee Rule for EPA-initiated risk
evaluation fees, enabling the fee payer to pay in installments. This
proposed change includes a two-payment process--first payment of 50% to
be due 180 days after EPA publishes the final scope of a chemical risk
evaluation and the second payment for the remainder no later than 545
days after EPA publishes the final scope of a chemical risk evaluation.
EPA believes that a two-payment process will reduce the burden on fee
payers and allow them to have more money on hand for operating and
other expenses that are incurred between payments.
2. Description of the Primary Alternative Regulatory Action Considered
EPA is requesting comment on alternative approaches for calculating
average volume and assigning fees based on volume produced. For
example, EPA could calculate fees based on average volume over the last
five years or based on the most recent year of reporting.
Alternatively, EPA could use production volume ranges and calculate
fees based on those ranges. In addition, EPA has considered caps for
fee payers, including those that qualify as a ``small business
concern.'' However, EPA believes imposing a cap on fees for individual
entities could result in EPA not collecting the full cost associated
with that risk evaluation. EPA requests comment on alternative
approaches for calculating and assigning fees based on production
volume.
C. Fee Categories
EPA has eight distinct fee categories: (1) Test orders, (2) test
rules and (3) ECAs, all under TSCA section 4; (4) notices and (5)
exemptions, both under TSCA section 5; and (6) EPA-initiated risk
evaluations, (7) manufacturer-requested risk evaluations for chemicals
on the TSCA Work Plan, and (8) manufacturer- requested risk evaluations
for chemicals not on the TSCA Work Plan, all under TSCA section 6. The
activities in these categories are fee-triggering events that result in
obligations to pay fees under the 2018 Fee Rule. EPA is proposing three
additional categories, as discussed in the following subsections of
this unit.
If a recipient of a test order fails to follow terms or conditions
in the order, including testing protocols outlined in TSCA section 4,
EPA may give the test order recipient the option to redo the testing
and submit the new data. Under the current rule, the Agency would incur
extra costs from reviewing this resubmitted data, costs that would not
be accounted for via the original fee payment by the recipient of the
test order. To address this, EPA is proposing to create a new fee for
test orders payable by recipients that elect to resubmit data per
request of the Agency if EPA determines that the recipient did not
comply with the terms or conditions of the order, such as the testing
protocols, or if a company later determines that data submitted under a
testing order is incomplete, inconsistent, or deficient. As presented
in the Economic Analysis (Ref. 4), EPA estimated that 10 test orders
will be issued annually with one being amended. EPA requests public
comment on these estimates. EPA also requests public comment on whether
this new fee will incentivize companies to correctly follow section 4
test order guidelines.
Companies that do not comply with section 4 test orders may be
subject to enforcement action by EPA. If a company does not comply with
the terms or conditions of the test order but subsequently resubmits
the data required under the testing order, EPA is proposing to charge a
fee associated with the submission of the new testing data. This new
fee would be equal to the initial fee levied on the recipient of the
initial test order. EPA is proposing changes to the regulations so that
any submission of data intended to comport with a test order for which
the order recipient was found to be in noncompliance. Additional fees
will be levied on companies which subsequently resubmit such data, each
time they resubmit the data until EPA determines that the testing is
consistent with the requirements of the original test order and the
data are acceptable for purposes of the data need identified in the
order. Because of the amount of time it takes for a testing order to be
issued and implemented (upwards of one year), levying a fee for this
purpose would further incentivize companies to fully understand and
follow the terms and conditions of the order, including testing
guidelines under section 4.
Additionally, EPA is correcting an error with the section 4 fees of
the 2018 Fee Rule regulations in which the fees for test orders and
test rules were reversed. The amount of the fees that would be charged
under section 4 was incorrect in the regulations, making the
distinctions between test rule and test order fees unclear. In this
proposal, EPA is proposing changes in the regulatory language to
reflect the correct fees for test orders and test rules.
Under regulations implementing TSCA section 5, a company that
intends to manufacture (including import) a chemical substance not
listed by specific chemical name in the public portion of the TSCA
Inventory may submit a Bona Fide Intent to Manufacture or Import Notice
(``bona fide notice'') to obtain written determination from EPA whether
the chemical substance is included in the confidential Inventory (40
CFR 720.25). The costs of the review process for bona fide notices were
not recovered under the 2018 Fee Rule. To recover the costs of
reviewing bona fide notices, EPA is proposing changes to the
regulations to require a fee for bona fide notices. EPA requests public
comment on whether these fees for bona fide notices will result in a
more equitable allocation of fees.
TSCA section 26(b)(1) states that ``[t]he Administrator may, by
rule, require the payment from any person required to submit . . . a
notice or other information to be reviewed by the Administrator under
section [5], . . . of a fee that is sufficient and not more than
reasonably necessary to defray the cost related to such chemical
substance of administering section[ 5] . . .'' Bona fide notices
submitted under regulations that are part of EPA's implementation of
section 5. EPA is proposing to utilize its authority under section
26(b)(1) to collect section 5 fees for bona fide notices. Assessing a
fee for bona fide notices will allow allocation of fees that will more
equitably account for the costs of carrying out all relevant section 5
activities. The proposed fee amount for a bona fide notice is $500 and
$90 for small businesses.
After PMN review has been completed under TSCA section 5, the
submitters of the PMN must provide a Notice of Commencement of
Manufacture or Import (NOC) to EPA within 30 calendar days of the date
the chemical substance is first manufactured or imported for
[[Page 1899]]
nonexempt commercial purposes (40 CFR 720.102). Once a complete NOC is
received by EPA, the reported chemical substance is considered to be on
the TSCA Inventory and becomes an existing chemical.
As described in Unit II.C., under the 2018 Fee Rule, EPA grouped
the costs associated with NOCs with those of PMNs, MCANs, and SNUNs.
EPA is proposing changes to the 2018 Fee Rule to include a separate fee
for NOC submissions. TSCA section 26(b)(1) states that ``[t]he
Administrator may, by rule, require the payment from any person
required to submit. . .a notice or other information to be reviewed by
the Administrator under section [5], . . . of a fee that is sufficient
and not more than reasonably necessary to defray the cost related to
such chemical of administering section [5] . . .'' NOC submissions are
part of EPA's implementation of section 5; they ensure that chemical
substances manufactured after TSCA section 5(a)(3) review appear on the
TSCA Inventory. EPA is proposing to utilize its authority under section
26(b)(1) to collect section 5 fees for NOC submissions. NOC fees will
help defray the costs of reviewing, processing, and retaining NOC
records and the costs of registering the chemical substance with the
Chemical Abstract Service. The proposed fee amount for NOC submissions
is $500 and $90 for small businesses.
D. Entities Subject to Fees
The 2018 Fee Rule applies to manufacturers and processors who are
required to submit information under TSCA section 4, manufacturers and
processors who submit certain notices and exemptions under TSCA section
5, and to manufacturers who are subject to risk evaluation under TSCA
section 6(b), including manufacturers who submit requests for risk
evaluation under TSCA section 6(b)(4)(C)(ii).
EPA is proposing modifications to certain groups of manufacturers
subject to TSCA section 6 fee activity requirements; including the
addition of manufacturers that exclusively export chemicals subject to
EPA-initiated risk evaluations whenever such chemical substances are
manufactured, processed, or distributed in commerce (by any other
entity) for any purpose other than export from the United States, as
well as five additional exclusions to entities subject to the fees for
TSCA section 6 activities.
1. Description of the Proposed Regulatory Action
EPA is proposing to add manufacturers that exclusively export
chemicals subject to EPA-initiated risk evaluations whenever such
chemical substances are manufactured, processed, or distributed in
commerce (by any other entity) for any purpose other than export from
the United States. This change recognizes that manufactures that
exclusively export High-Priority Substances are part of the risk
evaluation process and should, therefore, share in defraying the cost
of EPA-initiated risk evaluations. This regulatory action remains
consistent with TSCA section 12(a)(1).
Specially, TSCA section 12(a)(1) states that except as provided in
paragraph (2) and subsections (b) and (c), TSCA (other than TSCA
section 8) ``shall not apply to any chemical substance, mixture, or to
an article containing a chemical substance or mixture, if--(A) it can
be shown that such substance, mixture, or article is being
manufactured, processed, or distributed in commerce for export from the
United States, unless such substance, mixture, or article was, in fact,
manufactured, processed, or distributed in commerce, for use in the
United States, and (B) such substance, mixture, or article (when
distributed in commerce), or any container in which it is enclosed
(when so distributed), bears a stamp or label stating that such
substance, mixture, or article is intended for export.''
TSCA section 12(a) exempts manufacturers from TSCA coverage only
when such substance, mixture, or article is being manufactured,
processed, or distributed in commerce solely for export from the United
States. EPA does not anticipate that this exemption would generally
apply to chemical substances designated as High-Priority Substances for
risk evaluation since those chemical substances are anticipated to have
a range of conditions of use outside of export-only manufacture,
processing, and distribution. EPA acknowledges the ambiguity of this
aspect of TSCA section 12(a) and believes the statutory context here
(i.e., fee collection for risk evaluations for under TSCA section 6(b))
supports interpreting the export-only exemption narrowly. Therefore,
export-only manufacturers of such chemical substances will be subject
to fee payment obligations under this proposal.
EPA is also proposing to exclude certain manufacturers from EPA-
initiated risk evaluation fee requirements. On January 27, 2020, EPA
released the preliminary list of manufacturers subject to fee payments
for manufacture of chemicals subject to EPA-initiated risk evaluations
and received significant stakeholder feedback regarding the
practicalities of self-identifying under the TSCA Fee Rule given its
broad definition of ``manufacture.'' As stated in EPA's memorandum
issued on March 18, 2020, concerns were raised regarding fee payment
obligations for ``importers of articles containing any one of the
twenty listed chemicals . . .'' and that these entities ``could
potentially be required to test thousands of imported articles and
[it]would be difficult if not impossible to complete in the time
allotted for self-identification under the TSCA Fee Rule'' (Ref. 3).
EPA recognizes that manufacturers of chemicals as byproducts or
impurities may face similar challenges to pinpointing and tracking when
impurities and byproducts are produced, particularly because the
`manufacture' of even very small amounts of a high-priority chemical
triggers the TSCA Fee Rule requirement to self-identify.
In response to these concerns, EPA recognized that the current TSCA
Fee Rule may unintentionally impose potentially significant burdens on
three categories of manufacturers, causing compliance challenges with
self-identification and inconsistencies with other TSCA regulatory
contexts (Ref. 3). EPA also announced its plan to consider a proposed
rule that would look at potential exemptions to the TSCA Fee Rule in
response to stakeholder concerns about implementation challenges.
Consequently, EPA proposes to exempt these three categories of
manufacturers from EPA-initiated Risk Evaluation fees and associated
regulatory requirements: (1) Importers of articles containing a
chemical substance subject to an EPA-initiated risk evaluation; (2)
manufacturers of a substance subject to an EPA-initiated risk
evaluation that is produced as a byproduct; and (3) manufacturers
(including importers) of a substance subject to an EPA-initiated risk
evaluation that is produced or imported as an impurity. More
information on byproducts and impurities can be found here: https://www.epa.gov/tsca-fees/frequent-questions-about-tsca-fees-epa-initiated-risk-evaluations.
EPA is also proposing to exempt manufacturers of a substance
subject to an EPA-initiated risk evaluation that is produced as a non-
isolated intermediate. A non-isolated intermediate, as defined in 40
CFR part 704.3, referenced by 40 CFR part 711.3., is ``any intermediate
that is not intentionally removed from the equipment in which it is
manufactured, including the reaction vessel in which
[[Page 1900]]
it is manufactured, equipment which is ancillary to the reaction
vessel, and any equipment through which the substance passes during a
continuous flow process, but not including tanks or other vessels in
which the substance is stored after its manufacture. Mechanical or
gravity transfer through a closed system is not considered to be
intentional removal, but storage or transfer to shipping containers
isolates the substance by removing it from process equipment in which
it is manufactured.''
EPA believes exempting manufacturers of substances produced as a
non-isolated intermediate is consistent with other TSCA programs,
including the Chemical Data Reporting (CDR) described in 40 CFR
711.10(c) and the TSCA section 5 notice requirements described in 40
CFR 720.30.
In addition, EPA is proposing an exemption from EPA-initiated risk
evaluation fees and associated regulatory requirements for
manufacturers (including importers) of small quantities of a chemical
solely for research and development, as to be defined in 40 CFR 700.43.
Small quantities solely for research and development is defined to mean
quantities of a chemical substance manufactured, imported, or processed
or proposed to be manufactured, imported, or processed solely for
research and development that are not greater than reasonably necessary
for such purposes. This exemption will avoid imposing burdensome costs
to those manufacturers of small quantities of a chemical solely for
research and development, given the critical importance of this
activity to the detection, quantification and control of chemical
substances. Manufacturers that meet the research and development
exemption must meet it for the five-year period preceding publication
of the preliminary list and meet it in the successive five years.
Finally, EPA is proposing an exemption from EPA-initiated risk
evaluation fees and associated regulatory requirements for entities
that manufacture (including import) a chemical substance in quantities
not to exceed 2,500 lbs. This limit is consistent with requirements in
the CDR described in 40 CFR 711.8(b) and 40 CFR 711.15, where the
reporting threshold is 2,500 lbs. (1,134 kg) for any person who
manufactured a chemical substance that is the subject of certain rules,
orders, or relief under TSCA section 5, 6, and 7. This exception does
not apply if all manufacturers of a chemical substance manufacture that
chemical in quantities below a 2,500 lbs. annual production volume. EPA
is proposing this exemption to reduce the burden on entities producing
small amounts of the chemical substance undergoing an EPA-initiated
risk evaluation.
EPA is not proposing a concentration-based exemption. EPA believes
the exemption should be based on the amount of a chemical instead of
the concentration to ensure that the exemption only applies to the
manufacture of small quantities of a chemical. A concentration-based
exemption could result in manufacturers of large quantities of
chemicals being exempt from fee obligations. For this reason, EPA's
proposal contains an exemption based on a volume limit. EPA requests
public comment on the previously discussed exemptions, any other
exemptions that EPA should consider, and any data related to potential
impacts.
Manufacturers of a chemical substance undergoing TSCA section 6
EPA-initiated risk evaluations that would meet one or more of the
exemptions previously discussed for the five-year period preceding
publication of the preliminary list and would meet one of more of the
exemptions in the successive five years would be exempt from fee those
payment requirements. This five-year period is consistent with the
current criteria under the 2018 TSCA Fees rule for certification of
cessation.
2. Description of the Primary Alternative Regulatory Action Considered
EPA has considered an alternative regulatory action of no
exemptions and requests comment on this approach. TSCA requires EPA to
evaluate chemicals under their conditions of use, and conditions of use
evaluated may involve manufacture of chemicals that are exempt under
this proposal including impurities or byproducts, chemicals imported in
articles, or chemicals in small amounts solely for the purposes of
research and development. In addition, EPA does not consider these
exemptions in designating chemical substances as high priority
substances for risk evaluation, and there may be chemicals designated
where that chemical's primary condition of use is covered under one of
the five exemptions listed within this Unit, resulting in little to no
manufacturers obligated to pay the fee. This could result in higher
fees for entities that do not meet the exemption or no fee payments for
a chemical substance risk evaluation.
E. Self-Identification
1. Description of the Proposed Regulatory Action
Under the 2018 Fee Rule, after the close of a comment period for
the preliminary list of manufacturers subject to a fee obligation for
chemicals subject to EPA-initiated risk evaluations, EPA makes any
associated updates or corrections, and then publishes a final list of
manufacturers. This list indicates if any manufacturers were identified
in error, if any additional manufacturers were identified through the
comment period and/or reporting form, and if any manufacturers
certified that they have already ceased manufacture prior to the
applicable cutoff date described in the regulations and will not
manufacture the subject chemical substance for five years into the
future. The final list is published concurrently with the final scope
document for risk evaluations initiated by EPA under TSCA section 6,
and with the final test rule under TSCA section 4. Currently, there is
no added flexibility to modify the list of fee payers in the event of
receipt of additional information after publication of the final list.
EPA is proposing added flexibility to allow for potential changes
to the list of fee payers after it is finalized. Specifically, EPA is
proposing to allow for modification of the list upon receipt of
information indicating that such a change is warranted.
EPA believes that this proposed process is largely consistent with
comments on the 2018 Proposed Fee Rule (83 FR 8212) requiring EPA to
publish a preliminary list and engage with stakeholders to identify
others who may be missing, correct errors, and provide an opportunity
for manufacturers to be removed from the list under certain
circumstances.
In addition, EPA has received industry stakeholder feedback
regarding the identification of manufacturers on the preliminary and
final list of manufacturers subject to fees for the 20 high priority
substances undergoing TSCA risk evaluations. Stakeholders recommended
EPA create an avenue for manufacturers to identify other manufacturers
that may be subject to these fees not present on the preliminary list
of fee payers. EPA appreciates this feedback but is not proposing
changes to the issuance of a preliminary list followed by a public
comment period. EPA believes this process (i.e., publication of a
preliminary list that identifies manufacturers, a public comment
period, and publication of a final list
[[Page 1901]]
defining the universe of manufacturers responsible for payment) allows
for self-identification, correction of errors, and certification of no-
manufacture and no intention to manufacture in the next five years. EPA
also plans to continue communication with manufacturers and importers
that contact EPA with questions or concerns. Manufacturers may also
utilize the existing EPA portal to report a tip or complaint to EPA,
found here https://www.epa.gov/enforcement/report-environmental-violation-general-information, including to report manufacturers once
the final list of manufacturers subject to the fees is published.
EPA is also proposing changes to the submission of self-
identification information in 40 CFR 700.45 to accompany the proposed
changes to the TSCA section 6 fee activities as well as changes to
which types of manufacturers are required to self-identify. These
changes include exempting manufacturers that meet the criteria of three
of the exemptions discussed in Unit III.D. (i.e., importers of articles
containing the chemical substance, manufacturers of the substance that
is produced as a byproduct, and manufacturers of the substance that is
produced or imported as an impurity) from self-identification.
Additionally, EPA is proposing to require manufacturers of small
quantities solely for research and development and those that
manufacture in quantities not to exceed 2,500 lbs., and manufacturers
of chemical substances produced as a non-isolated intermediate to
certify that they meet those exemption criteria. EPA is also proposing
to require all other non-exempted manufacturers to provide the volume
produced by that manufacturer for the subject chemical. More discussion
on the use of production volume in the methodology for calculating fees
is in Unit III.B. EPA is also proposing to require all manufacturers
that self-identify as meeting the production volume exemption of 2,500
lbs. to maintain production volume records related to compliance with
the exemption. EPA is also proposing to require those manufacturers of
substances produced as a non-isolated intermediate to maintain ordinary
business records related to compliance with this exemption criteria.
Additionally, EPA is proposing that all manufacturers that self-
identify as meeting the research and development exemption maintain
ordinary business records related to compliance, such as plans of
study, information from research and development notebooks, study
reports, or notice solely for research and development use. EPA is
proposing that these required records be kept for a period of five
years. EPA has authority under section 6 to require reporting and
recordkeeping related to the regulatory requirements imposed by EPA
under section 6. This is particularly important where, as here, such
records and reports are necessary for effective enforcement of the
section 6 rule.
2. Description of the Primary Alternative Regulatory Action Considered
EPA has considered an alternative regulatory approach of allowing
manufacturers that had previously certified cessation, as described in
40 CFR 700.45 (b)(5)(ii), to then begin manufacturing or importing that
chemical within the successive five-year period. Those manufacturers
would be required to pay their portion of the fee associated with that
chemical substance risk evaluation, but it would occur after the
initial invoicing period. EPA believes this would result in a
substantial increase in burden to EPA, allowing continued changes to
those entities responsible for paying the EPA-initiated risk evaluation
fees after the initial invoicing period. In addition, EPA believes this
may result in inequity between those manufacturers paying the fees at
the time of initial invoicing and those companies being allowed to opt
back in any time after that period. Therefore, EPA is not proposing
changes to the five-year period associated with the certification of
cessation. As currently drafted, a manufacturer may certify cessation
if it has ceased manufacturing prior to the certification cutoff dates
and will not manufacture the substance again in the successive five
years. Manufacturers that have certified cessation for a substance that
then manufacture that substance again within the successive five years
would be engaging in a prohibited act under TSCA section 15(1) and
therefore would be subject to a penalty under TSCA section 16.
Nonetheless, EPA is requesting comment on a regulatory approach that
would allow manufacturers that previously certified cessation to begin
manufacturing or importing the chemical within the successive five-year
period. EPA is particularly interested in suggestions for decreasing
the burden associated with allowing changes to manufacturing status
(including potential recalculation and reimbursement of fees to
manufacturers that were subject to initial fee payments) and comments
from entities that might be subject to initial payments and therefore
potential inequities.
Additionally, alternatives were considered in regard to EPA's
authority to collect fees from processors under section 4 and 6 of
TSCA. Although EPA has authority to collect fees from both
manufacturers and processors of chemical substances, the 2018 Fee Rule
and this subsequent update focus fee collection primarily on
manufacturers. EPA will collect fees from processors only when
processors submit a SNUN or test-marketing exemptions (TME) under
section 5, when a section 4 activity is tied to a SNUN submission by a
processor, or when a processor voluntarily joins a consortium and
therefore agrees to provide payment as part of the consortium. This
approach is consistent with most comments received during the 2018 Fee
Rule. EPA believes the allocation primarily to manufacturers, and, in
limited circumstances, to processors, is an appropriate balance of the
authorities provided by TSCA. As stated in past rules and notices, the
effort of trying to identify relevant processors for all fee-triggering
actions would be overly burdensome and EPA expected that many
processors would be missed. Generally limiting fee obligations to
manufacturers is the simplest and most straightforward way to assess
fees for conducting risk evaluations under TSCA section 6 and most TSCA
section 4 testing activities. Furthermore, EPA expects that
manufacturers required to pay fees will have a better sense of the
universe of processors and will pass some of the costs on to them.
F. Timing
The 2018 Fee Rule generally requires upfront payment of fees (i.e.,
payment due prior to EPA reviewing a TSCA section 5 notice, within 120
days of publication of final test rule, within 120 days of issuance of
a test order, within 120 days of signing an ECA, within 30 days of
granting a manufacturer- requested risk evaluation, and within 120 days
of publishing the final scope of a risk evaluations). However, for
manufacturer-requested risk evaluations, payment is collected in two
installments over the course of the activity. EPA is proposing several
changes to the timing of specific stages within this fees process.
These are summarized in table 6 and discussed in more detail throughout
this unit.
[[Page 1902]]
Table 6--Proposed Changes to Timing Within the Fee Rule *
----------------------------------------------------------------------------------------------------------------
Stage in the fees process Timing under 2018 fee rule Proposed timing changes
----------------------------------------------------------------------------------------------------------------
Payment of fees................................... Initial payment within 30 Initial payment within 180
days of EPA providing notice days of EPA providing notice
of granting a manufacturer- of granting a manufacturer-
requested risk evaluation. requested risk evaluation.
Payment is collected in two Payments are collected over
installments over the course three installments.
of the activity.
For EPA-initiated risk For EPA-initiated risk
evaluations, payment is evaluation, payment is
collected in one installment collected over two
120 days after EPA publishes installments, the first
the final scope of a payment of 50% to be due 180
chemical risk evaluation. days after EPA publishes the
final scope of a chemical
risk evaluation and the
second payment due not later
than 545 days after EPA
publishes the final scope of
a chemical risk evaluation.
Consortia......................................... 60 days to notify EPA of 90 days to notify EPA of
intent to form a consortium intent to form a consortium
from the triggering event. from the triggering event.
----------------------------------------------------------------------------------------------------------------
Currently, manufacturers have 60 days to notify EPA of their intent
to form a consortium from the triggering event, and 120 days total from
the triggering event for payment. EPA is proposing to allow
manufacturers subject to test orders, test rules, ECAs and EPA-
initiated risk evaluations additional time to associate with a
consortium and work out fee payments within that consortium.
Specifically, EPA is proposing to extend the amount of time for
manufacturers to notify EPA of their intent to form a consortium to 90
days. EPA believes this additional time will be useful for businesses
to financially plan for the additional expense.
For EPA-initiated risk evaluations, full payment is currently due
within 120 days of EPA publishing the final scope of a chemical risk
evaluation. EPA is proposing to extend that first payment timeline to
180 days and to provide for payment to be made in two installments
instead of one, as discussed in Unit III.B. EPA is also proposing an
extension to the amount of time for these manufacturers to join a
consortium, from 60 days to 90 days to notify EPA of their intent. EPA
believes this additional time will assist manufacturers with the
process of joining a consortium, if they so choose, and deciding on the
partial fee payments each member of the consortium will be responsible
for. Manufacturers will have ample warning that a risk evaluation is
underway, well before the final scope is published in the Federal
Register. For manufacturer-requested risk evaluations, EPA is proposing
that the initial payment be made within 180 days of when EPA grants the
request to conduct the evaluation, with the total amount to be paid
over a series of three installments as indicated in Unit III.B. of the
proposed rule.
G. Fee Amounts
Because the eight existing fee categories and three additional fee
categories do not span all of the relevant activities under TSCA
sections 4, 5, and 6 and relevant information management activities
(e.g., costs of administering TSCA section 14, risk management
activities under section 6, prioritization of chemicals for evaluation,
support for alternative testing and methods development and
enhancement), EPA is proposing fee amounts to ensure these costs would
be captured.
As discussed in Unit II, EPA must recover 25% of the costs related
to the relevant activities under of TSCA sections 4, 5, 6 and 14. EPA
did not propose changes to the fees associated with TSCA section 4 and
5 established under the 2018 Fees Rule. EPA is, however, proposing
higher fees for TSCA section 6 activities. The proportion (in
percentage) of the estimated cost of the activity is higher for TSCA
section 6 fees to ensure EPA is recovering the required 25% of the
total cost for implementing the relevant sections of TSCA. Additional
justification for each TSCA section is discussed within this Unit. EPA
requests public comment on this approach with higher fees for section 6
activities and no changes to section 4 and 5 fees established under the
2018 Fees Rule.
1. Fee Amounts for TSCA Section 4 Activities
EPA issues three fee amounts--one for each of the TSCA section 4
fee categories: Test orders, test rules and ECAs. As proposed, the fees
for section 4 activities amount to approximately 4.1% of the total
estimated activity cost. The lower fee relative to program costs takes
into account that manufacturers will be responsible for paying to
develop the test information in addition to paying the TSCA fee and is
reflected in assigning lower proposed fee amounts. EPA is not proposing
changes to the section 4 fees established under the 2018 Fees Rule at
this time. However, EPA may modify these in the future with more
implementation experience.
2. Fee Amounts for TSCA Section 5 Activities
EPA currently issues two fee amounts for TSCA section 5
activities--one for notices (PMNs, SNUNs and MCANs), and one for
exemptions (LVEs, LoREX, TME, Tier II, TERA and film articles). EPA is
proposing two additional fee amounts for bona fide notices and NOCs. As
proposed, the fees for section 5 activities amount to approximately 13%
of the estimated cost of the activities. EPA is currently working on
process improvements for the review of section 5 submissions, which are
anticipated to lower agency costs. Since EPA does not want to stifle
economic development in the chemical industry, EPA is not proposing
changes to the section 5 fees established under the 2018 Fees Rule at
this time. However, EPA may modify these in the future with more
implementation experience.
3. Fee Amounts for TSCA Section 6 Activities
EPA issues one fee amount for EPA-initiated risk evaluations at
approximately 35% of the estimated cost of the activity. EPA takes an
actual cost approach for manufacturer-requested risk evaluations,
whereby the requesting manufacturer (or requesting consortia of
manufacturers) would be obligated to pay either 50% or 100% of the
actual costs of the activity, depending on whether or not the chemical
was listed on the TSCA Work Plan, respectively.
Due to the increases to TSCA section 6 program cost estimates,
decreases in the activity assumptions for TSCA section 5 submissions,
early feedback
[[Page 1903]]
received from industry stakeholders during the 2018 rulemaking, and to
ensure EPA is able to defray 25% of the Agency's costs, EPA is
proposing higher fees for TSCA section 6 activities (Ref. 2; Ref. 4).
The proposed fee amounts are described in Table 7. EPA is
requesting comment on the changes discussed in Unit II.C.
Table 7--Proposed Changes to TSCA Fee Amounts
------------------------------------------------------------------------
2020 Proposed fee
Fee category 2018 fee rule rule
------------------------------------------------------------------------
TSCA section 4: ....................
Test order.............. $9,800.............. $9,800.
Amended test order...... $0.................. $9,800.
Test rule............... $29,500............. $29,500.
Enforceable consent $22,800............. $22,800.
agreement.
TSCA section 5:
PMN and consolidated $16,000............. $16,000.
PMN, SNUN, MCAN and
consolidated MCAN.
LoREX, LVE, TME, Tier II $4,700.............. $4,700.
exemption, TERA, Film
Articles.
Bona Fide Notice............ $0.................. $500.
Notice of Commencement...... $0.................. $500.
TSCA section 6:
EPA-initiated risk $1,350,000.......... $2,560,000.
evaluation.
Manufacturer-requested Initial payment of Two payments of
risk evaluation on a $1.25M, with final $945,000, with
chemical included in invoice to recover final invoice to
the TSCA Work Plan. 50% of Actual Costs. recover 50% of
Actual Costs.
Manufacturer-requested risk Initial payment of Two payments of
evaluation on a chemical $2.5M, with final $1.89M, with final
not included in the TSCA invoice to recover invoice to recover
Work Plan. 100% of Actual 100% of Actual
Costs. Costs.
------------------------------------------------------------------------
4. Fee Amounts for Small Businesses
The proposed fee amounts for small businesses summarized in Table 8
represent an approximate 80% reduction compared to the proposed base
fee for each category. In one case, for TSCA section 5 notices (i.e.,
PMNs, MCANs and SNUNs), the small business reduction is 82.5%. For all
fee categories, the proposed reduced fee is only available when the
only entity or entities are small businesses, including when a
consortium is paying the fee and all members of that consortium are
small businesses. Consistent with the 2018 Fee Rule, reduced fees are
not available for small business manufacturers requesting a risk
evaluation, as TSCA requires those fees to be set at a specific
percentage of the actual costs of the activity.
These discounts were established in the 2018 Fees Rule and were the
result of stakeholder input. EPA believes the approximate 80% discount
in the 2018 Fee Rule is appropriate and that the discount is generally
in line with EPA's discount for small businesses in the pesticides
program (i.e., 75%), but slightly higher based on significant
stakeholder input regarding the need to minimize impacts on small
businesses. EPA is not proposing changes to these discounts.
EPA is requesting comment on the small business discount as it
relates to the proposed volume-based fee calculations changes discussed
in Unit III.B.
Table 8--Proposed Changes to TSCA Fee Amounts for Small Businesses
------------------------------------------------------------------------
2020 Proposed fee
Fee category 2018 fee rule rule
------------------------------------------------------------------------
TSCA section 4:
Test order.............. $1,950.............. $1,960.
Amended test order...... $0.................. $1,960.
Test rule............... $5,900.............. $5,900.
Enforceable consent $4,600.............. $4,600.
agreement.
TSCA section 5:
PMN and consolidated $2,800.............. $2,800.
PMN, SNUN, MCAN and
consolidated MCAN.
LoREX, LVE, TME, Tier II $940................ $940
exemption, TERA, Film
Articles.
Bona Fide Notice........ $0.................. $90.
Notice of Commencement.. $0.................. $90.
TSCA section 6:
EPA-initiated risk $270,000............ $512,000.
evaluation.
Manufacturer-requested $1,250,000 initial Two payments of
risk evaluation on a payment + 50% of $945,000 with final
chemical included in total actual costs. invoice to recover
the TSCA Work Plan.. 50% of actual
costs.
Manufacturer-requested $2,500,000 initial Two payments of
risk evaluation on a payment + 100% of $1.89M with final
chemical not included total actual costs. invoice to recover
in the TSCA Work Plan. 100% of actual
costs.
------------------------------------------------------------------------
[[Page 1904]]
5. Description of the Primary Alternative Regulatory Action Considered
EPA has considered an alternative regulatory action where the fees
remain unchanged except for an adjustment for inflation. In the absence
of any substantive adjustments or updates, the 2018 TSCA Fees Rule
provides for adjusting the fee structure of the current period (fiscal
years 2019-2021) according to inflation rate, in setting a fee
structure for the next period. This adjustment occurs automatically if
no other updates are put forth by EPA. EPA has considered this
regulatory alternative, but has found it unsuitable, because it would
not recoup the statutorily required 25% of estimated EPA costs for TSCA
related actions. EPA requests public comment on this approach.
IV. Projected Economic Impacts
EPA has evaluated the potential costs for entities potentially
subject to this proposed rule. More details can be found in the
Economic Analysis (Ref. 4). For the baseline, EPA used the number of
section 5 submissions received in FY2019 and 2020 for each of the types
of fee-triggering section 5 categories to estimate the number of
submissions per section 5 fee category for the next three years in the
absence of the rule. The average numbers of test orders, test rules,
and ECAs per year represent an EPA estimate based on previous
experience and expected work under TSCA as amended. Amended TSCA
specifies the minimum number of risk evaluations that EPA must have
ongoing over the next three years. The Agency expects to have between
20 and 30 risk evaluations ongoing in any given year at different
stages in the review process, including manufacturer-requested
evaluations.
Various alternative fee structures were considered in the original
fee rule but are not being revisited in this proposal. This proposed
rule would establish a few new fees and would revise existing fee
levels based on actual cost information and updated estimates but would
not re-open the fee structure. EPA also requests public comment on this
approach.
EPA calculated fees by estimating the total annual costs of
administering relevant activities under TSCA sections 4, 5, and 6
(excluding the costs of manufacturer-requested risk evaluations) and
relevant information management activities; identifying the full amount
to be defrayed by fees under TSCA section 26(b) (i.e., 25% of those
annual costs); and allocating that amount across the fee-triggering
events in sections 4, 5, and 6, weighted more heavily toward section 6
based on industry feedback on the 2018 Fees Rule Proposal. EPA
estimates the total fee collection by multiplying the fees with the
number of expected fee-triggering events under full implementation for
each fee category, for a total of approximately $22 million in average
annual fee revenue. This total does not include the fees collected for
manufacturer-requested risk evaluations. EPA estimates that section 4
fees account for less than one percent of the total fee collection,
section 5 fees for approximately 25 percent, and section 6 fees for
approximately 74 percent.
Total annual fee collection for manufacturer-requested risk
evaluations is estimated to be $1.9 million for chemicals included in
the TSCA Work Plan (based on two requests over the three- year period)
and approximately $5.67 million for chemicals not included in the TSCA
Work Plan (based on three requests over the three-year period).
For small businesses, EPA estimates that 35 percent of section 5
submissions will be from small businesses that are eligible to pay the
small business fee because they are classified as small businesses
based on the SBA small business thresholds.
Total annualized fee collection from small businesses submitting
notices under section 5 is estimated to be $411,000 (Ref. 4). For
sections 4 and 6, reduced fees paid by eligible small businesses and
fees paid by non-small businesses may differ because the fee paid by
each entity is dependent on the number of entities identified per fee-
triggering event. EPA relied on past experience with Test Rules for HPV
chemicals under section 4 as well as work to date on the first 10
chemicals to undergo risk evaluation under section 6 to inform its
estimates of the average number of small businesses impacted per
action. EPA estimates that average annual fee collection from small
businesses impacted by section 4 activities would be approximately
$8,000, and the average annual fee collection from small businesses
impacted by section 6 would be approximately $922,000. For each of the
three years covered by this proposed rule, EPA estimates that total fee
revenue collected from small businesses will account for about 6
percent of the approximately $22 million total fee collection, for an
annual average total of approximately $1.3 million.
This proposed rule would establish fee requirements for affected
manufacturers (including importers) and, in some cases, processors of
chemical substances. The proposed fees to be paid by industry would
defray the cost for EPA to administer relevant activities under TSCA
sections 4, 5, and 6 and relevant information management activities.
Absent this proposed rule, EPA costs to administer these sections of
TSCA would be solely borne by taxpayers through budget appropriations
from general revenue. As a result of this proposed rule, 25% of EPA
costs to administer relevant activities under TSCA sections 4, 5, and 6
and relevant management activities, and activities paid from general
revenue would be transferred to industry via fee payments.
Although these fees may be perceived by industry as direct private
costs, from an economic perspective, they are transfer payments from
industry to taxpayers rather than real social costs. Therefore, the
total social cost of this proposed rule does not include the fees
collected from industry by EPA. Rather, it includes the opportunity
costs incurred by industry, such as the cost to read and familiarize
themselves with the rule; determine their eligibility for paying
reduced fees; register for Central Data Exchange (CDX); form, manage
and notify EPA of participation in consortia; notify EPA and certify
whether they will be subject to the action or not; and arrange to
submit fee payments via Pay.gov. Total social costs also include the
additional costs to EPA to administer fee assessment and collection for
relevant activities under TSCA sections 4, 5, and 6, and relevant
information management activities. The total additional annualized
opportunity cost to industry, relative to the 2018 TSCA Fees Rule, is
approximately $12,000. It is estimated that the EPA will incur no
additional burden, relative to the 2018 TSCA Fees Rule, as a result of
the proposed Fee Rule amendments. Thus, it is estimated that the agency
will incur no additional opportunity costs, and that total annual
opportunity costs amount to approximately $12,000.
V. References
The following is a listing of the documents that are specifically
referenced in this document. The docket includes these documents and
other information considered by EPA, including documents that are
referenced within the documents that are included in the docket, even
if the referenced document is not physically located in the docket. For
assistance in locating these other documents, please consult the
technical person listed under FOR FURTHER INFORMATION CONTACT.
[[Page 1905]]
1. The Frank R. Lautenberg Chemical Safety for the 21st Century Act.
June 22, 2016.
2. EPA. Final Rule; Fees for the Administration of the Toxic
Substances Control Act. Federal Register. 83 FR 52694, October 17,
2018 (FRL-9984-41).
3. EPA. Request for No Action Assurance Regarding Self-
Identification Requirement for Certain ``Manufacturers'' Subject to
the TSCA Fees Rule. March 2020. https://www.epa.gov/sites/production/files/2020-03/documents/tsca_fees_-_naa_request_final.pdf.
4. EPA. Economic Analysis of the Proposed Rule for Fees for the
Administration of the Toxic Substances Control Act. September 2020.
5. EPA. TSCA Work Plan Chemicals: Methods Document. February 2012.
https://www.epa.gov/sites/production/files/2014-03/documents/work_plan_methods_document_web_final.pdf.
6. EPA. Information Collection Request for the TSCA section 26(b)
Proposed Reporting Requirements Associated with the Payment of TSCA
Fees (EPA ICR No. 2569.01; OMB Control No. 2070-[NEW]). November
2020.
VI. Statutory and Executive Order Reviews
Additional information about these statutes and Executive Orders
can be found at https://www.epa.gov/laws-regulations/laws-and-executive-orders.
A. Executive Order 12866: Regulatory Planning and Review and Executive
Order 13563: Improving Regulation and Regulatory Review
This action is a significant regulatory action that was submitted
to the Office of Management and Budget (OMB) for review under Executive
Orders 12866 (58 FR 51735, October 4, 1993) and 13563 (76 FR 3821,
January 21, 2011). Any changes made in response to OMB recommendations
have been documented in the docket for this action as required by
section 6(a)(3)(E) of Executive Order 12866.
EPA prepared an economic analysis of the potential costs and
benefits associated with this action (Ref. 4). A copy of this economic
analysis is available in the docket and is briefly summarized in Unit
IV.
B. Executive Order 13771: Reducing Regulation and Controlling
Regulatory Costs
This action is considered a regulatory action under Executive Order
13771 (82 FR 9339, February 3, 2017). Details on the estimated costs of
this rule can be found in the Economic Analysis (Ref. 4), which briefly
summarized in Unit IV.
C. Paperwork Reduction Act (PRA)
The information collection activities in this rule have been
submitted for approval to OMB under the PRA, 44 U.S.C. 3501 et seq. The
Information Collection Request (ICR) document that the EPA prepared has
been assigned EPA ICR No. 2569.03 and OMB Control No. 2070-0208. A copy
of the ICR is available in the docket for this proposed rule (Ref. 6),
and it is briefly summarized here. The information collection
requirements are not enforceable until OMB approves them.
The information collection activities associated with the rule
include familiarization with the regulation; reduced fee eligibility
determination; CDX registration; formation, management and notification
to EPA of participation in consortia; self-identification and
certification; and electronic payment of fees through Pay.gov.
Respondents/affected entities: Persons who manufacture, or process
a chemical substance (or any combination of such activities) and are
required to submit information to EPA under TSCA sections 4 or 5, or
manufacture a chemical substance that is the subject of a risk
evaluation under TSCA section 6(b).
Respondent's obligation to respond: Mandatory--TSCA section 26(b).
Estimated number of respondents: 1,348.
Frequency of response: On occasion.
Total estimated burden: 581 hours (per year). Burden is defined at
5 CFR 1320.3(b).
Total estimated cost: $273,388 (per year), includes $0 annualized
capital or operation and maintenance costs.
An agency may not conduct or sponsor, and a person is not required
to respond to, a collection of information unless it displays a
currently valid OMB control number. The OMB control numbers for EPA's
regulations in 40 CFR part 700 are listed in 40 CFR part 9. Submit your
comments on the Agency's need for this information, the accuracy of the
provided burden estimates and any suggested methods for minimizing
respondent burden to the EPA using the docket identified at the
beginning of this rule. You may also send your ICR-related comments to
OMB's Office of Information and Regulatory Affairs via email to
[email protected], Attention: Desk Officer for the EPA.
D. Regulatory Flexibility Act (RFA)
I certify that this action will not have a significant economic
impact on a substantial number of small entities under the RFA, 5
U.S.C. 601 et seq. The small entities expected to be subject to the
requirements of this action are small chemical manufacturers and
processors, small petroleum refineries, and small chemical and
petroleum wholesalers. There may be some potentially affected firms
within other sectors, but not all firms within those sectors will be
potentially affected firms. 84 small businesses may be affected
annually by section 4 actions; 190 small businesses may be affected by
section 5 actions; and 24 small businesses may be affected by section 6
actions.
EPA estimates the median annual sales for small businesses likely
to be affected by TSCA section 4 and TSCA section 6 actions to be
approximately $5,445,000; and $3,475,000 for small businesses likely to
be affected by TSCA section 5 actions. The average annual incremental
cost per affected small business is expected to be about $150 for
section 4; $120 for section 5, and $16,200 for section 6. As a result,
EPA estimates that, of the 429 small businesses paying fees every year,
all may have annual cost-revenue impacts less than 1%.
E. Unfunded Mandates Reform Act (UMRA)
This action does not contain an unfunded mandate of $100 million or
more as described in UMRA, 2 U.S.C. 1531-1538, and will not
significantly or uniquely affect small governments. The rule is not
expected to result in expenditures by State, local, and Tribal
governments, in the aggregate, or by the private sector, of $100
million or more (when adjusted annually for inflation) in any one year.
Accordingly, this proposed rule is not subject to the requirements of
sections 202, 203, or 205 of UMRA. The total quantified annualized
social costs for this proposed rule are approximately $12,000 (at both
3% and 7% discount rate), which does not exceed the inflation-adjusted
unfunded mandate threshold of $160 million.
F. Executive Order 13132: Federalism
This action does not have federalism implications because it is not
expected to have substantial direct effects on the States, on the
relationship between the national government and the States, or on the
distribution of power and responsibilities among the various levels of
government as specified in Executive Order 13132 (64 FR 43255, August
10, 1999). Thus, Executive Order 13132 does not apply to this action.
G. Executive Order 13175: Consultation and Coordination With Indian
Tribal Governments
This action does not have tribal implications because it is not
expected to have substantial direct effects on
[[Page 1906]]
tribal governments, on the relationship between the Federal Government
and the Indian tribes, or on the distribution of power and
responsibilities between the Federal Government and Indian tribes, as
specified in Executive Order 13175 (65 FR 67249, November 9, 2000).
Thus, Executive Order 13175 does not apply to this rule.
H. Executive Order 13045: Protection of Children From Environmental
Health and Safety Risks
EPA interprets Executive Order 13045 (62 FR 19885, April 23, 1997),
as applying only to those regulatory actions that concern environmental
health or safety risks that EPA has reason to believe may
disproportionately affect children, per the definition of ``covered
regulatory action'' in section 2-202 of Executive Order 13045. This
action is not subject to Executive Order 13045 because it does not
establish an environmental standard intended to mitigate environmental
health risks or safety risks.
I. Executive Order 13211: Actions Concerning Regulations That
Significantly Affect Energy Supply, Distribution, or Use
This action is not a ``significant energy action'' as defined in
Executive Order 13211 (66 FR 28355, May 22, 2001) because it is not
likely to have a significant adverse effect on energy supply,
distribution, or use of energy and has not been designated by the
Administrator of the Office of Information and Regulatory Affairs as a
significant energy action.
J. National Technology Transfer and Advancement Act (NTTAA)
This rulemaking does not involve any technical standards.
Therefore, NTTAA section 12(d), 15 U.S.C. 272 note, does not apply to
this action.
K. Executive Order 12898: Federal Actions To Address Environmental
Justice in Minority Populations and Low-Income Populations
EPA believes that this action does not have disproportionately high
and adverse health or environmental effects on minority populations,
low-income populations and/or indigenous peoples, as specified in
Executive Order 12898 (59 FR 7629, February 16, 1994). The
documentation for this decision is contained in the Economic Analysis
(Ref. 4), which is in the public docket for this action.
List of Subjects 40 CFR Part 700
Chemicals, Environmental protection, Hazardous substances,
Reporting and recordkeeping requirements, User fees.
Andrew Wheeler,
Administrator.
Therefore, for the reasons presented in this document, the
Environmental Protection Agency proposes to amend 40 CFR part 700 as
follows:
PART 700--GENERAL
0
1. The authority citation for part 700 is revised to read as follows:
Authority: 15 U.S.C. 2625 and 2665, 44 U.S.C. 3504.
0
2. Amend Section 700.43 by:
0
a. Adding in alphabetical order a definition for ``Production volume'';
0
b. Revising the definition of ``Section 5 notice''; and
0
c. Adding in alphabetical order a definition for ``Small quantities
solely for research and development''.
The additions and revisions read as follows:
Sec. 700.43 Definitions applicable to this subpart.
* * * * *
Production volume means average annual manufactured (or imported)
amount in pounds from the four calendar years prior to the year
certification was made.
* * * * *
Section 5 notice means any PMN, consolidated PMN, intermediate PMN,
significant new use notice, exemption notice, exemption application,
MCAN, consolidated MCAN, bona fide intent to manufacture (including
import) a chemical substance under Sec. 720.25(b)(2) of this chapter,
or notice of commencement of manufacture or import under Sec. 720.102
of this chapter.
* * * * *
Small quantities solely for research and development (or ``small
quantities solely for purposes of scientific experimentation or
analysis or chemical research on, or analysis of, such substance or
another substance, including such research or analysis for the
development of a product'') means quantities of a chemical substance
manufactured, imported, or processed or proposed to be manufactured,
imported, or processed solely for research and development that are not
greater than reasonably necessary for such purposes.
* * * * *
0
3. Amend Sec. 700.45 by:
0
a. Revising paragraph (a)(3);
0
b. Revising the paragraph (b) subject heading and paragraphs (b)(5)(ii)
and (iii):
0
c. Adding paragraphs (b)(5)(iv) through (vi);
0
d. Revising paragraph (b)(7);
0
e. Revising the paragraph (c) subject heading and paragraphs (c)(1)(i)
and (c)(1)(vi) through (viii);
0
f. Adding paragraphs (c)(1)(ix) and (x);
0
g. Revising paragraphs (c)(2)(vi) through (xi);
0
h. Adding paragraphs (c)(2)(xii) through (xiv);
0
i. Revising paragraphs (d), (f)(2)(i), (f)(3)(i), (f)(4), (f)(5)(iv),
(g)(3)(iv), and (g)(5)(ii);
0
j. Adding paragraphs (g)(5)(v) and (vi);
0
k. Revising paragraph (g)(6)(ii); and
0
l. Adding paragraphs (g)(6)(v) and (vi).
The revisions and additions read as follows:
Sec. 700.45 Fee payments.
(a) * * *
(3) Manufacturers of a chemical substance that is subject to a risk
evaluation under section 6(b) of the Act, shall remit for each such
chemical risk evaluation the applicable fee identified in paragraph (c)
of this section in accordance with the procedures in paragraphs (f) and
(g) of this section. For the purposes of this section, entities that
manufacture a chemical substance subject to a risk evaluation under
section 6(b) of the Act solely for export are subject to fee
requirements in this section whenever such substance is manufactured,
processed, or distributed in commerce by any other entity for any
purpose other than export from the United States. Manufacturers of a
chemical substance subject to risk evaluation under section 6(b) of the
Act are exempted from fee payment requirements in this section, if they
meet one or more of the exemptions under paragraphs (a)(3)(i) through
(v) of this section for the five-year period preceding publication of
the preliminary list and will meet one of more of the exemptions in
paragraph (a)(3)(i) through (v) in the successive five years. Those
manufacturers are excluded from fee payment requirements in this
section, if they exclusively:
(i) Import articles containing that chemical substance;
(ii) Produce that chemical substance as a byproduct;
(iii) Manufacture (including import) that chemical substance as an
impurity;
(iv) Manufacture that chemical substance as a non-isolated
intermediate as defined in Sec. Sec. 704.3
(v) Manufacture (including import) small quantities of that
chemical
[[Page 1907]]
substance solely for research and development, as defined in Sec.
700.43; and/or
(vi) Manufacture (including import) that chemical substance in
quantities below a 2,500 lbs. annual production volume as described in
Sec. 700.43, unless all manufacturers of that chemical substance
manufacture that chemical in quantities below a 2,500 lbs. annual
production volume as described in Sec. 700.43, in which case this
exemption is not applicable.
* * * * *
(b) Identifying manufacturers subject to fees for section 4 test
rules and section 6 EPA-initiated risk evaluations
* * * * *
(5) Self-identification. All manufacturers other than those listed
in paragraph (a)(3)(i) through (iii) of this section who have
manufactured or imported the chemical substance in the previous five
years must submit notice to EPA, irrespective of whether they are
included in the preliminary list specified in paragraph (b)(3) of this
section. The notice must be submitted electronically via EPA's Central
Data Exchange (CDX), the Agency's electronic reporting portal, using
the Chemical Information Submission System (CISS) reporting tool, and
must contain the following information:
* * * * *
(ii) Certification of cessation. If a manufacturer has manufactured
in the five-year period preceding publication of the preliminary list,
but has ceased manufacture prior to the certification cutoff dates
identified in paragraph (b)(6) of this section and will not manufacture
the substance again in the successive five years, the manufacturer may
submit a certification statement attesting to these facts. If EPA
receives such a certification statement from a manufacturer, the
manufacturer will not be included in the final list of manufacturers
described in paragraph (b)(7) and will not be obligated to pay the fee
under this section.
(iii) Certification of no manufacture. If a manufacturer is
identified on the preliminary list but has not manufactured the
chemical in the five-year period preceding publication of the
preliminary list, the manufacturer may submit a certification statement
attesting to these facts. If EPA receives such a certification
statement from a manufacturer, the manufacturer will not be included in
the final list of manufacturers described in paragraph (b)(7) and will
not be obligated to pay the fee under this section.
(iv) Certification of meeting exemption. If a manufacturer is
identified on the preliminary list and meets one or more of the
exemptions in paragraphs (a)(3)(i) through (vi) of this section for the
five-year period preceding publication of the preliminary list and will
meet one of more of the exemptions in paragraphs (a)(3)(i) through (vi)
in the successive five years, the manufacturer must submit a
certification statement attesting to these facts in order to not be
included in the final list of manufacturers described in paragraph
(b)(7) of this section and to not be obligated to pay the fee under
this section. If a manufacturer is not on a preliminary list and meets
one or more of the exemptions in paragraphs (a)(3)(i) through (vi) for
the five-year period preceding publication of the preliminary list and
will meet one of more of the exemptions in paragraphs (a)(3)(i) through
(vi) in the successive five years, the manufacturer may submit a
certification statement attesting to these facts. If EPA receives such
a certification statement from a manufacturer, the manufacturer will
not be included in the final list of manufacturers described in
paragraph (b)(7) and will not be obligated to pay the fee under this
section.
(v) Recordkeeping. After [DATE 60 CALENDAR DAYS AFTER THE DATE OF
PUBLICATION OF THE FINAL RULE]:
(A) All manufacturers other than those listed in paragraphs
(a)(3)(i) through (vi) of this section must maintain production volume
records related to compliance with paragraph (vi) of this section.
These records must be maintained for a period of five years from the
date notice is submitted pursuant to paragraph (b)(5) of this section.
(B) Those manufacturers that are exempt from fee payment
requirements pursuant to paragraph (a)(3)(vi) of this section must
maintain production volume records related to compliance with the
exemption criteria described in paragraph (a)(3)(vi). These records
must be maintained for a period of five years from the date the
exemption is claimed.
(C) Those manufacturers that are exempt from fee payment
requirements pursuant to paragraph (a)(3)(v) of this section must
maintain ordinary business records related to compliance with the
exemption criteria described in paragraph (a)(3)(v), such as plans of
study, information from research and development notebooks, study
reports, or notice solely for research and development use. These
records must be maintained for a period of five years from the date the
record is generated.
(D) Those manufacturers that are exempt from fee payment
requirements pursuant to paragraph (a)(3)(iv) of this section must
maintain ordinary business records related to compliance with the
exemption criteria described in paragraph (a)(3)(iv). These records
must be maintained for a period of five years from the date the record
is generated.
(vi) Production volume. A manufacturer submitting notice to EPA
under paragraph (b)(5) of this section, other than those manufacturers
listed in paragraphs (a)(3)(i) through (v) of this section, must submit
to EPA its production volume as defined in Sec. 700.43 for the
applicable chemical substance.
* * * * *
(7) Publication of final list. EPA will publish a final list of
manufacturers to identify the specific manufacturers subject to the
applicable fee. This list will indicate if additional manufacturers
self-identified pursuant to paragraph (b)(5) of this section, if other
manufacturers were identified through credible public comment, and if
manufacturers submitted certification of cessation or no manufacture
pursuant to paragraph (b)(5)(ii) or (iii). The final list will be
published no later than concurrently with the final scope document for
risk evaluations initiated by EPA under section 6, and with the final
test rule for test rules under section 4. EPA may modify the list after
the publication of the final list.
* * * * *
(c) Fees for the 2022, 2023, and 2024 fiscal years. Persons shall
remit fee payments to EPA as follows:
(1) * * *
(i) Premanufacture notice and consolidated premanufacture notice.
Persons shall remit a fee totaling $2,800 for each premanufacture
notice (PMN) or consolidated PMN submitted in accordance with part 720
of this chapter.
* * * * *
(vi) Bona fide intent to manufacture (including import) a chemical
substance. Persons shall remit a fee totaling $90 for each bona fide
intent to manufacture (including import) submitted in accordance with
Sec. 720.25 of this chapter.
(vii) Notice of commencement of manufacture or import. Persons
shall remit a fee totaling $90 for each notice of commencement of
manufacture or import submitted in accordance with Sec. 720.102 of
this chapter.
(viii) Persons shall remit a total of twenty percent of the
applicable fee under paragraph (c)(2)(viii), (ix) or (x) of
[[Page 1908]]
this section for a test rule, test order, or enforceable consent
agreement.
(ix) Persons shall remit a total fee of twenty percent of the
applicable fee under paragraphs (c)(2)(xii) of this section for an EPA-
initiated risk evaluation.
(x) Persons shall remit the total fee under paragraph (c)(2)(xiii)
or (xiv) of this section, as applicable, for a manufacturer-requested
risk evaluation.
(2) * * * :
(vi) Bona fide intent to manufacture (including import) a chemical
substance. Persons shall remit a fee totaling $500 for each bona fide
intent to manufacture (including import) submitted in accordance with
Sec. 720.25 of this chapter.
(vii) Notice of commencement of manufacture or import. Persons
shall remit a fee totaling $500 for each notice of commencement of
manufacture or import submitted in accordance with Sec. 720.102 of
this chapter.
(viii) Test rule. Persons shall remit a fee totaling $29,500 for
each test rule.
(ix) Test order. Persons shall remit a fee totaling $9,800 for each
test order.
(x) Resubmitted data. Persons shall remit a fee totaling $9,800 for
data submitted following submission of deficient data in response to a
test order.
(xi) Enforceable consent agreement. Persons shall remit a fee
totaling $22,800 for each enforceable consent agreement.
(xii) EPA-initiated chemical risk evaluation. Persons shall remit a
fee totaling $2,560,000.
(xiii) Manufacturer-requested risk evaluation of a Work Plan
Chemical. Persons shall remit an initial fee of $945,000, a second
payment of $945,000 and final payment to total 50% of the actual costs
of this activity, in accordance with the procedures in paragraph (g) of
this section. The final payment amount will be determined by EPA, and
EPA will issue an invoice to the requesting manufacturer.
(xiv) Manufacturer-requested risk evaluation of a non-work plan
chemical. Persons shall remit an initial fee of $1,890,000, a second
payment of $1,890,000, and final payment to total 100% of the actual
costs of the activity, in accordance with the procedures in paragraph
(g) of this section. The final payment amount will be determined by
EPA, and EPA will issue an invoice to the requesting manufacturer.
* * * * *
(d) Fees for 2025 fiscal year and beyond. (1) Fees for the 2025 and
later fiscal years will be adjusted on a three-year cycle by
multiplying the fees in paragraph (c) of this section by the current
PPI index value with a base year of 2022 using the following formula:
FA = F x I
Where:
FA = the inflation-adjusted future year fee amount.
F = the fee specified in paragraph (c) of this section.
I = Producer Price Index for Chemicals and Allied Products inflation
value with 2022 as a base year.
(2) Updated fee amounts for PMNs, SNUNs, MCANs, exemption notices,
exemption applications, bona fide intent to manufacture (including
import) a chemical substance, notice of commencement of manufacture or
import, and manufacturer-requested chemical risk evaluation requests
apply to submissions received by the Agency on or after October 1 of
every three-year fee adjustment cycle beginning in fiscal year 2022
(October 1, 2021). Updated fee amounts also apply to test rules, test
orders, enforceable consent agreements and EPA-initiated chemical
evaluations that are ``noticed'' on or after October 1 of every three-
year fee adjustment cycle, beginning in fiscal 2022.
(3) The Agency will initiate public consultation through notice-
and-comment rulemaking prior to making fee adjustments beyond
inflation. If it is determined that no additional adjustment is
necessary beyond for inflation, EPA will provide public notice of the
inflation-adjusted fee amounts most likely through posting to the
Agency's web page by the beginning of each three-year fee adjustment
cycle (October 1, 2024, October 1, 2027, etc.). If the Agency
determines that adjustments beyond inflation are necessary, EPA will
provide public notice of that determination and the process to be
followed to make those adjustments.
* * * * *
(f) * * *
(2) * * *
(i) The consortium must identify a principal sponsor and provide
notification to EPA that a consortium has formed. The notification must
be accomplished within 90 days of the publication date of a test rule
under section 4 of the Act, or within 90 days of the issuance of a test
order under Section 4 of the Act, or within 90 days of the signing of
an enforceable consent agreement under section 4 of the Act. EPA may
permit additional entities to join an existing consortium prior to the
expiration of the notification period if the principal sponsor provides
updated notification.
* * * * *
(3) * * *
(i) Notification must be provided to EPA that a consortium has
formed. The notification must be accomplished within 90 days of the
publication of the final scope of a chemical risk evaluation under
section 6(b)(4)(D) of the Act or within 90 days of EPA providing
notification to a manufacturer that a manufacturer-requested risk
evaluation has been granted.
* * * * *
(4)(i) If multiple persons are subject to fees triggered by section
4 or 6(b) of the Act and no consortium is formed, EPA will determine
the portion of the total applicable fee to be remitted by each person
subject to the requirement. Each person's share of the applicable fees
triggered by section 4 of the Act specified in paragraph (c) of this
section shall be in proportion to the total number of manufacturers
and/or processors of the chemical substance, with lower fees for small
businesses:
[GRAPHIC] [TIFF OMITTED] TP11JA21.020
(ii) Each person's share of the applicable fees triggered by
section 6(b) of the Act specified in paragraph (c) of this section
shall be in proportion to the total number of manufacturers of the
chemical substance, with lower fees for small businesses:
[GRAPHIC] [TIFF OMITTED] TP11JA21.021
Where:
Fs = the total fee required under paragraph (c) of this
section by a person(s) who qualifies as a small business concern
under Sec. 700.43 of this chapter.
Fo = the total fee required under paragraph (c) of this
section by person(s) other than a small business concern.
Vs = the production volume of a person who qualifies as a
small business concern under paragraph (c) as a percentage of the
total production volume as defined in Sec. 700.43 of person(s) who
qualify as a small business concern under paragraph (c) of this
section.
Vo = the production volume of a person other than a small
business concern as a percentage of the total production volume as
defined in Sec. 700.43 of person(s) other than a small business
concern.
[[Page 1909]]
Ps = the portion of the fee under paragraph (c) of this
section that is owed by a person who qualifies as a small business
concern under Sec. 700.43 of this chapter.
Po = the portion of the fee owed by a person other than a
small business concern.
F = the total fee required under paragraph (c) of this section.
Mt = the total number of persons subject to the fee
requirement.
Ms = the number of persons subject to the fee requirement
who qualify as a small business concern.
(5) * * *
(iv) Reallocate the remaining fee across those remaining
individuals and groups based on the portion of total production volume
as defined in Sec. 700.43, considering the production volume of each
manufacturer not in a consortium and the total production volume of the
manufacturers in a consortium; and
* * * * *
(g) * * *
(3) * * *
(iv) Risk evaluations. (A) For EPA-initiated risk evaluations, the
applicable fee specified in paragraph (c) of this section shall be paid
in two installments, with the first payment of 50% due 180 days after
publishing the final scope of a risk evaluation and the second payment
for the remainder of the fee due 545 days after publishing the final
scope of a risk evaluation under section 6(b)(4)(D) of the Act.
(B) * * *
(1) The applicable fee specified in paragraph (c) of this section
shall be paid in three installments. The first payment shall be due no
later than 180 days after EPA provides the submitting manufacture(s)
notice that it has granted the request.
(2) The second payment shall be due no later than 545 days after
EPA provides the submitting manufacturer(s) notice that it has granted
the request.
(3) The final payment shall be due no later than 30 days after EPA
publishes the final risk evaluation.
* * * * *
(5) * * *
(ii) Each person who remits the fee identified in paragraph (c)(1)
of this section for a LVE, LoREX, TERA, TME, or Tier II exemption
request under TSCA section 5 shall insert a check mark for the
statement, ``The company named in part 1, section A is a small business
concern under Sec. 700.43 and has remitted a fee of $940 in accordance
with Sec. 700.45(c).'' in the exemption application.
* * * * *
(v) Each person who remits the fee identified in paragraph (c)(1)
of this section for a bona fide intent to manufacture (including
import) a chemical substance shall insert a check mark for the
statement, ``The company named in part 1, section A is a small business
concern under Sec. 700.43 and has remitted a fee of $90 in accordance
with Sec. 700.45(c).'' when submitting a request in accordance with
Sec. 720.25(b)(2) of this chapter.
(vi) Each person who remits the fee identified in paragraph (c)(1)
of this section for a notice of commencement of manufacture or import
shall insert a check mark for the statement, ``The company named in
part 1, section A is a small business concern under Sec. 700.43 and
has remitted a fee of $90 in accordance with Sec. 700.45(c).'' when
submitting a notice in accordance with Sec. 720.102(d)(2) of this
chapter.
(6) * * *
(ii) Each person who remits a fee identified in paragraph (c)(2) of
this section for a LVE, LoREX, TERA, TME, or Tier II exemption request
under TSCA section 5 shall insert a check mark for the statement, ``The
company named in part 1, section A has remitted the fee of $4,700
specified in Sec. 700.45(c).'' in the exemption application.
* * * * *
(v) Each person who remits the fee identified in paragraph (c)(2)
of this section for a bona fide intent to manufacture (including
import) a chemical substance shall insert a check mark for the
statement, ``The company named in part 1, section A has remitted the
fee of $500 in accordance with Sec. 700.45(c).'' when submitting a
request in accordance with Sec. 720.25(b)(2) of this chapter.
(vi) Each person who remits the fee identified in paragraph (c)(2)
of this section for a notice of commencement of manufacture or import
shall insert a check mark for the statement, ``The company named in
part 1, section A has remitted the fee of $500 in accordance with Sec.
700.45(c).'' when submitting a notice in accordance with Sec.
720.102(d)(2) of this chapter.
* * * * *
[FR Doc. 2020-28585 Filed 1-8-21; 8:45 am]
BILLING CODE 6560-50-P