Chemical Safety Overhaul: President Obama Signs TSCA Reform Legislation

On June 22, 2016, President Obama signed the Frank Lautenberg Chemical Safety for the 21st Century Act, landmark bipartisan legislation to overhaul the  Toxic Substances Control Act (TSCA). This reform legislation, designed to make it easier for the EPA to regulate toxic substances while providing the chemical industry with regulatory clarity and certainty, is the first major environmental legislation passed in over two decades.

TSCA, enacted in October 1976, had frequently been criticized as ineffective. It required companies to register new chemicals with the EPA prior to using them in products and industrial processes, but the new chemicals were automatically approved for use. In fact, in order to regulate a chemical, it was the EPA’s burden to show the chemical posed an unreasonable risk to human health or the environment.

Companies were required to supply the EPA only limited information about their products, and were able to withhold information from the public by arguing that the data was a trade secret. In contrast, the EPA could not require industry to conduct research without first having evidence that the chemical posed a health risk.

The results of TSCA’s shortcomings became obvious over time. Consumers began to lose confidence in product safety. While industry adds 700 to 1,000 new chemicals to the marketplace every year, only about 2% of the chemicals in use today have undergone a safety review by government scientists, according the U.S. Government Accountability Office.

In the absence of a strong federal system, a patchwork of state chemical safety laws arose in response to consumer product safety concerns, creating compliance issues for industry. The EPA seemed unable to successfully regulate dangerous products using TSCA.

One of the few times the EPA sought to ban an existing chemical, the U.S. Court of Appeals for the Fifth Circuit overturned the EPA ban on asbestos (Corrosion Proof Fittings v. EPA, 947 F.2d 1201 (5th Cir. 1991)), holding that the agency failed to comply with the TSCA statutory requirement to identify the “least burdensome” option before regulating. (See 15 U.S.C. § 2605(a)).

In response to these issues, and facing expanding regulation both on the state and international level (with the passage of chemical regulation laws in the EU, Canada and China), groups ranging from the chemical industry to environmental NGOs called for TSCA reform, ultimately resulting in this successful bipartisan overhaul.

The Lautenberg Act rectifies TSCA by allowing the EPA to make an affirmative finding that a new chemical is safe prior to marketplace entry, and empowering the EPA to determine the risks of a chemical without considering the economic implications.

The new TSCA requirements will place serious demands on the EPA’s resources. As a starting point, the EPA is tasked with reviewing its inventory of 85,000 substances (only a fraction of which are still in commerce today), identifying substances that are high priorities for risk evaluation, evaluating their health and environmental risks, and ultimately regulating those substances found to present an “unreasonable risk under conditions of use.” All these steps must proceed on a strict timetable. For example, safety evaluations of the first ten substances that the EPA designates as “high priority” must begin within six months of the law’s passage.

Other significant changes made by the Lautenberg Act include:

  • Requiring companies to substantiate claims of trade secret before withholding data.
  • Eliminating the “least burdensome” requirement for chemical regulations that led to the Fifth Circuit invalidating the EPA asbestos ban.
  • Allowing preemption of state chemical regulations under certain conditions. The issue of federal preemption was the most contentious issue of TSCA reform, due to concerns of limiting the rights of states to set their own chemical safety standards.
  • Requiring development of a new risk-based standard that takes into account vulnerable populations, such as children and pregnant women.
  •  implementing industry fees to fund 25 percent of EPA’s overall costs for carrying out the testing and safety reviews for new and existing chemicals.

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