Addition of Reporting Elements; Toxic Chemical Release Reporting; Community Right-to-Know

SUMMARY: EPA intends to expand its Community Right-to-Know initiatives

to increase the information available to the public on chemical use.

This Advance Notice of Proposed Rulemaking is intended to give notice

of EPA's consideration of this issue and to solicit comments on all

aspects of chemical use and the collection of chemical use data and is

an initial step in the regulatory development process. In the context

of this action, EPA is considering all potential components of

``chemical use.'' For the purposes of this Notice, the term ``chemical

use'' refers to the information most commonly described as materials

accounting data: amounts of a toxic chemical coming into a facility,

amounts transformed into products and wastes, and the resulting amounts

leaving the facility site. EPA believes that the collection of

additional chemical use information beyond that already provided by the

Toxic Release Inventory (TRI) data base would provide a more detailed

and comprehensive picture to the public about environmental performance

and about toxic chemicals in communities. TRI is the data base in which

information collected under section 313 of the Emergency Planning and

Community Right-to-Know Act (EPCRA) and section 6607 of the Pollution

Prevention Act (PPA) is made available. EPA is considering expanding

the type of information contained in this data base. A number of

important concerns associated with the reporting and interpretation of

chemical use information have been raised to the Agency, and EPA has

determined that additional evaluation is needed before EPA can develop

a proposal. In this ANPR, EPA is (1) Describing the Agency's plans to

further evaluate these issues; (2) providing preliminary notice of

additional public meetings; (3) requesting comment and information on

issues where additional assessment is needed; (4) soliciting actual

assessments that have been performed on these issues and (5) seeking

public input concerning development of regulation in this area.

DATES: Written and electronic comments in response to this ANPR must be

received on or before December 30, 1996.

ADDRESSES: Written comments should be submitted in triplicate to: OPPT

Docket Clerk, TSCA Document Receipt Office (7407), Office of Pollution

Prevention and Toxics, Environmental Protection Agency, Rm. E-G099, 401

M St., SW., Washington, DC 20460. Comments containing information

claimed as confidential must be clearly marked as confidential business

information (CBI). If CBI is claimed, three additional sanitized copies

must also be submitted. Nonconfidential versions of comments will be

placed in the record for this action and will be available for public

inspection. Comments should include the docket control number for this

ANPR, OPPTS-400106 and the EPA contact. Unit IV. of this document

contains additional information on submitting comments containing

information claimed as CBI.

Comments and data may also be submitted electronically by sending

electronic mail (e-mail) to: [email protected]. Electronic

comments must be submitted as an ASCII file avoiding the use of special

characters and any form of encryption. Comments and data will also be

accepted on disks in WordPerfect 5.1 file format or ASCII file format.

All comments and data in electronic form must be identified by the

docket number OPPTS-400106. No CBI should be submitted through e-mail.

Electronic comments on this ANPR may be filed online at many Federal

Depository Libraries. Additional information on electronic submissions

can be found in Unit IV. of this document.

FOR FURTHER INFORMATION CONTACT: Matt Gillen at 202-260-1801, e-mail:

[email protected]; or Christine Lottes at 202-260-7258, e-

mail: [email protected] for specific information

regarding this ANPR. For further information on EPCRA section 313

contact the Emergency Planning and Community Right-to-Know Hotline,

Environmental Protection Agency, Mail Stop 5101, 401 M St., SW.,

Washington, DC 20460. Toll free: 1-800-535-0202, in Virginia and

Alaska: 703-412-9877 or Toll free TDD: 800-553-7672.

SUPPLEMENTARY INFORMATION:

I. Introduction

A. Background

EPA considers Right-to-Know to be among its most effective

strategies for improving environmental performance. Facilities

currently covered by the TRI have reduced their reported releases of

toxic chemicals by 44 percent, or 1.6 billion pounds, since 1988. These

reductions have been attributed to voluntary industry action motivated

by a number of factors including: (1) The availability of TRI data for

release and transfers of covered chemicals; (2) public involvement in

facility and community planning; (3) flexibility in choosing reduction

methods; and (4) transparency of facility performance. In the Federal

Register of November 30, 1994 (59 FR 61432) (FRL-4922-2), EPA issued a

final rule that expanded the chemical coverage of TRI to include 286

additional toxic chemicals; and in the Federal Register of June 27,

1996 (61 FR 33588) (FRL-5379-3), EPA proposed adding an additional

seven industrial sectors to TRI. The Agency's commitment to expanding

the TRI and the Right-to-Know Program is premised on its effectiveness

as a tool to encourage pollution prevention, improved environmental

quality, informed public involvement and public awareness of toxic

chemicals that move to and through their communities.

The TRI-Phase 3 project builds on two successful strategies:

Pollution Prevention and Community Right-to-Know. [In this ANPR, the

title ``TRI-Phase 3'' is used to designate the entire chemical use

right-to-know project. The ``TRI'' is retained in recognition that the

project arose out of a TRI background, even though EPA is currently

considering use of non-TRI statutory authorities.] Pollution prevention

provides the framework for identifying opportunities to reduce

pollution at the source through cost effective changes in production,

operation, and raw materials use. It encourages companies to consider

opportunities for source reduction as the preferred route to improved

environmental performance. Community Right-to-Know provides the

framework for informing and educating citizens so that they can

participate more effectively in decisions that affect their families

and communities. Community Right-to-Know is increasingly recognized as

an essential decisionmaking tool for both the public and industry.

Public information fosters informed environmental involvement by many

different segments of society, from citizens and consumers to corporate

decisionmakers. Expanding public participation motivates improved

environmental performance, and over the long term promotes the

integration of environmental goals with economic and social goals. In

addition to these

[[Page 51323]]

benefits, EPA believes that materials accounting has the potential to

significantly increase the utility and completeness of data that would

be available to identify, evaluate, and track toxic chemicals in the

workplace and community. This is important because it is at the

community level where environmental problems can first be identified,

and where the groups with the most at stake can come together to

develop solutions to best fit local needs.

EPA believes that publicly available chemical use information shows

promise for filling a number of data gaps identified by TRI

stakeholders and that it could link together pollution prevention and

Community Right-to-Know. Chemical use information could expand the

public's ability to evaluate a range of national and community level

environmental issues. Some stakeholders suggest that chemical use data

may be used to assess the amounts of chemicals flowing into and through

communities, the overall quantities of toxics going into products,

worker safety and health issues, and facility pollution prevention

performance. Chemical use data, in conjunction with existing TRI data,

could also provide a more comprehensive picture of chemical use at the

facility level. The more complete the understanding of use and

wastestreams, the better positioned a facility is to assess process and

product efficiencies and to modify use, process, or product as

appropriate. Likewise, the more complete the understanding, the better

positioned the public is to participate on an equal footing in

environmental decisionmaking.

The TRI-Phase 3 project began in 1993, and public meetings were

held in 1994 and 1995 to receive stakeholder comments. On August 8,

1995, in a memorandum to the EPA Administrator, President Clinton

directed EPA to expedite Community Right-to-Know initiatives stating:

``I am committed to the effective implementation of this law [EPCRA]

because Community Right-to-Know protections provide a basic

informational tool to encourage informed community-based environmental

decisionmaking and provide a strong incentive for businesses to find

their own ways of preventing pollution.'' The memorandum directed EPA

to develop and implement ``an expedited, open, and transparent process

for consideration of reporting under EPCRA on information on the use of

toxic chemicals at facilities, including information on mass balance,

materials accounting, or other chemical use data.'' This ANPR is part

of EPA's response to this directive.

B. Statutory Authority

EPA has available a number of statutory authorities that would

allow the Agency to collect chemical use data elements. Because EPA has

not determined which data elements would constitute a ``chemical use

data set,'' it is premature to identify which specific authority(ies)

would be used. Instead, at this time, EPA is considering a variety of

strategies that could be used, individually or in combination, to

expand the reporting and public availability of chemical use data. For

example, the Agency might propose the addition of several data elements

to expand the TRI reporting requirements established under section 313

of the Emergency Planning and Community Right-to-Know Act of 1986

(EPCRA) (42 U.S.C. section 11023), and statutorily expanded under

section 6607 of the Pollution Prevention Act of 1990 (PPA) (42 U.S.C

section 13106). Alternatively, EPA might consider actions under the

Toxic Substances Control Act (TSCA), the Clean Water Act (CWA), the

Clean Air Act (CAA), etc. EPA is also reviewing existing use data

collected under other environmental statutes and by other Federal

agencies such as the Occupational Safety and Health Administration and

the Department of Transportation, and could propose a strategy based on

improving public access to such data. Improved public access is likely

to involve some type of linkage with TRI, since it is considered the

main public source of environmental data.

EPCRA section 313 requires the owner or operator of a facility at

which a listed chemical was manufactured, imported, processed or

otherwise used at levels exceeding the statutory thresholds, to report

certain information. Among the information required to be reported

about each toxic chemical is the general category or categories of use,

an estimated range of the maximum amount present at the facility, and

the annual quantity entering each environmental medium. Section 328

grants the Administrator general rulemaking authority to implement

EPCRA. 42 U.S.C. section 11048.

Section 6607 of the PPA requires owners and operators of a facility

who must report under EPCRA section 313, to also report annually to EPA

certain information on source reduction and recycling. Among the

information that must be reported is the amount of the chemical

recycled on or off-site, the quantity of the chemical released into the

environment, the quantity of the chemical entering any waste stream (or

otherwise released into the environment) prior to recycling, treatment

or disposal. Facilities must also report on source reduction practices

and the techniques used to identify source reduction opportunities.

Section 8(a) of TSCA provides EPA with authority to require

manufacturers, importers, and processors of a chemical substance or

mixture to submit such reports as the Administrator may reasonably

require. 15 U.S.C. section 2607(a). This section grants EPA broad

discretion in determining what information must be reported, including:

categories of use for each chemical substance or mixture; estimates of

the amount manufactured or processed for each category of use; a

description of the by-products resulting from manufacture, processing,

use or disposal of each chemical substance or mixture; and estimates of

the number of workers exposed and the duration of such exposure.

EPA is currently developing proposed amendments to the TSCA

Inventory Update Rule (IUR) (51 FR 21438, June 12, 1986) to require

submission of information predictive of the potential for chemical

exposures including data on industrial and consumer uses. These

amendments of the IUR are referred to as the Chemical Use Inventory.

EPA intends to use the data collected under the Chemical Use Inventory

to screen chemical risks and to establish risk assessment and risk

management priorities.

While, arguably, some similar information could be collected under

section 8(a) of TSCA and under EPCRA section 313 and PPA section 6607,

there are differences in the underlying purposes and available

authorities that may make it preferable to use multiple authorities to

accomplish the goal. For example, TSCA section 8(a) covers a larger

number of chemicals than EPCRA section 313; however, EPCRA section 313

covers pesticides, whereas TSCA section 8(a) does not. Use of EPCRA

section 313 raises fewer public access issues, but would not involve

the statutory small business exclusion included in TSCA section 8(a). A

further distinction is that TRI includes information from manufacturers

(including importers), processors and users, whereas TSCA section 8(a)

is limited to manufacturers, importers, and processors. In considering

any proposed rule(s) to require chemical use information in furtherance

of its Community Right-to-Know objectives, EPA is mindful of its

possibly overlapping authorities and will continue to coordinate its

efforts to avoid duplicative requirements.

[[Page 51324]]

In addition to the provisions discussed above, EPA is also

considering the information collection authority available under all of

the other statutes it implements, including the Federal Insecticide,

Fungicide, and Rodenticide Act, 7 U.S.C. section 136 et. seq., the

Clean Water Act, 33 U.S.C. section 1251 et. seq., the Clean Air Act, 42

U.S.C. section 7401 et. seq., the Resource Conservation and Recovery

Act, 42 U.S.C. section 6901 et. seq., and the Comprehensive

Environmental Response, Compensation, and Liability Act, 42 U.S.C.

section 9601 et. seq.

EPA has received a number of comments challenging EPA's authority

to collect the kind of information discussed in this ANPR under EPCRA

or the PPA. EPA believes that it has a broad array of statutory

authorities available to it to require reporting of data elements

discussed in this ANPR. EPA is currently examining all of the statutes

it implements to determine which authorities would be relevant to the

collection of chemical use data and the goals outlined in this ANPR.

However, until EPA determines the course of action to follow, any

discussion of specific statutory authority is premature.

C. Chemical Use and Materials Accounting Concepts and Background

``Chemical use'' is a broad information category that includes

qualitative (e.g., function or end-use), and quantitative (e.g., amount

or material flow) components. Use data are basic facility management

information and essential to understanding material use and costs. In

the TRI-Phase 3 project, EPA is looking at those aspects of use related

to the amounts of toxic chemicals entering and leaving a facility,

along with ancillary information connecting worker activity and

chemical use. The tracking of chemical throughput data is an

established engineering practice for many processes, currently

performed at many facilities to develop estimates for TRI reporting and

to monitor the engineering efficiency of facility processes. ``Mass

balance'' is the term used to describe the systematic collection and

evaluation of throughput data. The term reflects the principle that the

sum of the mass of chemical inputs (into a process or facility) should

equal the sum of the outputs after all chemical changes and

accumulations have been accounted for. Closure occurs when inputs and

outputs match or balance (within the accuracy of the measurements).

Mass balance is used as a tool for managing chemicals because lack of

closure may point to the need to examine the system for possible

losses. Such losses can have important economic and environmental costs

associated with them. Closure increases confidence that potential

losses have been identified and accounted for. Mass balance serves a

function similar to financial accounting, where inputs (income) and

outputs (expenses) are reconciled on a regular basis as a routine check

on financial performance.

Engineering mass balance is the most accurate type of mass balance,

as it involves actual measurement of process streams. It is useful for

engineering design of processes. Materials accounting is a more

approximate method of reporting a mass balance. It relies on routinely

collected information such as records of incoming shipments of raw

materials, production records, and product composition data. While it

is less accurate than engineering mass balance, it nevertheless

provides useful information and is also less costly to perform.

Materials accounting has been the main focus of TRI-Phase 3.

The utility of reporting mass balance information on TRI has been

debated for over a decade. It was discussed during the negotiations

that led to the passage of EPCRA in 1986. Proponents of mass balance

data claimed that it would provide essential reference data underlying

release estimates, and provide for a ledger check on TRI estimates. As

such, proponents contend that chemical throughput should itself be

considered a Right-to-Know issue. Opponents questioned the added value

provided by materials balance data when compared to the cost, the

public's need for information beyond release estimates, and the

potential loss of sensitive or confidential business information.

Because this issue was unresolved at the time of passage, section

313(l) of EPCRA directed EPA to arrange for the National Academy of

Sciences (NAS) to study this issue further. The resulting report,

entitled ``Tracking Toxic Substances at Industrial Facilities'' was

released in 1990. The purpose of the NAS study, as stated in EPCRA

section 313, was to examine the contribution that mass balance

information could make to assessing the accuracy of chemical release

estimates, evaluating waste-reduction efficiency, and providing

perspective on chemical management practices. The study was

inconclusive as to a recommendation to pursue or to drop consideration

of mass balance reporting. The NAS panel did, however, conclude that

materials accounting data, properly validated and interpreted by

persons with sufficient technical knowledge, may have better potential

for achieving the goals for the national uses listed in section 313

than engineering mass balance data. It went on to state that materials

accounting data were not precise enough for some purposes such as

checking on the accuracy of release estimates, but that these data did

warrant further consideration for looking at other issues such as the

reasonableness of release estimates, and for providing a better picture

of waste reduction progress. Finally, the study provided a number of

recommendations for future studies, many of which are reflected in

EPA's requests for comment in this ANPR.

Because the NAS evaluation was completed prior to enactment of PPA,

it did not evaluate the utility of materials accounting data against

the current TRI data set. Availability of the Form R section 8 data may

have allowed for a more definitive NAS conclusion.

TRI reporting trends clearly indicate that industry has made

reductions in releases and that industry is moving up the waste

management hierarchy established by PPA. However, based on 1994 TRI

data, the overall level of waste generated by industry is not

declining, thus raising many questions about the extent to which source

reduction progress is occurring and how it should be measured. The PPA

charges the Administrator with establishing standard methods for

measuring source reduction, and EPA believes materials accounting data

could facilitate the development and implementation of such methods.

TRI currently provides the public with quantitative data on the methods

of managing pollutants - recycling, treatment, and release (including

disposal). It does not provide data on source reduction, even though it

is the preferred national approach for improving environmental

performance.

Two states, New Jersey and Massachusetts, already require materials

accounting reporting. New Jersey began collection of such data in 1987

and expanded reporting beginning with the 1993 reporting year. The

state uses ten data elements to collect information on inputs and

outputs. Massachusetts began collection of materials accounting data in

1990 and uses five data elements to collect information on inputs and

outputs. Each state also collects data on performance measures

calculated from the materials accounting data. Some groups believe that

the resulting data have been useful in improving understanding and

measurement of source reduction progress. In addition, the availability

of these data have raised awareness about related Right-to-Know issues

such as the flow of toxics through communities and the potential

[[Page 51325]]

contribution of the product stream to environmental releases and

wastes. Stakeholders have indicated that information which would allow

life-cycle analysis of toxic chemicals would be useful in environmental

planning. Taken together, these developments have sustained general

interest in chemical use reporting over the years, and influenced EPA

to pursue additional review of materials accounting.

D. TRI-Phase 3 Origin and Status

The TRI-Phase 3 project grew out of EPA stakeholder meetings held

in 1993 to discuss the possible creation of a ``Chemical Use

Inventory'' (CUI). EPA initiated these discussions based on increasing

awareness of the potential value of ``use'' data to the Agency for

chemical screening and priority-setting under TSCA. Environmental and

public interest stakeholders were also interested in the concept of

facility-level chemical use data as a fundamental right-to-know issue,

and recommended that the Agency expand the project to put materials

accounting data in the public domain. These stakeholders described TRI

as the most logical place for this data, given its features and

importance. Industry stakeholders question that there is any

fundamental right to know about facility-level chemical use data unless

there is a demonstrated use. EPA created the TRI-Phase 3 project in

response to this interest and the importance of the underlying issues.

EPA prepared an initial issues paper (Issues Paper #1 - Ref. 3) and

held a public meeting in September of 1994 to begin the process of

exploring chemical use issues. The focus of the meeting was to learn

more about both stakeholder data needs driving the interest in

materials accounting and the nature of industry concerns. EPA

subsequently developed a three-step approach for categorizing and

evaluating TRI-Phase 3 issues and combined it with preliminary Agency

findings in a second issues paper released in October of 1995 (Issue

Paper #2 - Ref. 4). A report was also prepared in response to Executive

Order 12969 (Report to President Clinton - Expansion of Community

Right-to-Know Reporting to Include Chemical Use Data: Phase III of the

Toxics Release Inventory, Ref. 6). The Agency invited additional

comments in a second public meeting in October of 1995. This meeting

provided opportunity for more extensive discussion on issues such as

CBI concerns, and the potential for overlap with existing Agency

reporting. The Agency has prepared a third issues paper to report back

to stakeholders on what the Agency heard at the second public meeting,

and to describe plans for additional evaluation (Ref. 5). The issues

paper can be obtained from the EPCRA hotline at the numbers listed in

the FOR FURTHER INFORMATION CONTACT unit of this document, or

electronically via EPA's TRI Homepage at http://www.epa.gov/opptintr/

tri.

E. Discussion of Data Elements

EPA is considering several categories of data elements for

inclusion in this use information initiative, including elements on

chemical inputs, outputs, and occupational exposure indicators. By

input, EPA refers to the amounts of toxic chemicals brought into or

originating at a facility. By output, EPA refers to the amounts

produced, transformed into other chemicals, or present in products

leaving the site. EPA derived preliminary data element options from

those used in Massachusetts and New Jersey, where materials accounting

data is reported. Additional options were developed for occupational

indicator elements. The options, first described in Issues Paper #2

(Ref. 2), are described below. They are intended to encourage public

discussion.

Input options

Set A -Starting raw material inventory amount of the substance

-Amount produced on site

-Amount brought on site

Set B -Amount manufactured

-Amount processed

-Amount otherwise used

Set C -Total input amount

Output options

-Amount consumed on site

-Amount shipped off-site as (or in) product

-Ending raw material inventory amount

-Amount stored on site as or in product

Occupational exposure indicator options

Set A -Total number of workers at the facility

Set B -Total number of workers at the facility

-Number of workers potentially exposed to each EPCRA section 313

listed toxic chemical

Set C -Total number of workers at the facility

-Number of workers potentially exposed to each EPCRA section 313

listed toxic chemical

-Whether exposure assessment was performed for the chemical during

the year

-Whether exposure monitoring has ever been performed for the

chemical

Materials accounting measures

Waste-related source reduction performance measures

-Amount of wastes prevented by source reduction, in pounds

-Annual percentage (or index) reduction in total wastes

Normalization refinements

-Procedure for weighting multiple chemical uses

F. Relationship to Other Agency and Administration Priorities

EPA has received questions and comments on the value of chemical

use data to the Agency, and how it might fit with other Agency

priorities. TRI-Phase 3 is related to a variety of important issues

that cut across the Agency. EPA's 5-year strategic plan includes

``Prevention of wastes and harmful chemical releases,'' ``Improved

understanding of the environment,'' and ``Worker safety'' among its

national environmental goal areas. ``Pollution prevention'' and

``Environmental accountability'' are among EPA's guiding principles

(Ref. 2). EPA's responsibilities under PPA include establishing

standard methods of measurement of source reduction and facilitating

the adoption of source reduction techniques by business. The Agency

recognizes that improving efficiency of material use, for chemicals as

well as all other raw materials, is an important component of

sustainable development. The President's Council on Sustainable

Development recently recommended that the Federal government develop

indicators of progress toward national sustainable development goals

and to regularly report on these indicators to the public (Ref. 1).

EPA's role as a provider of information is central to a strategy

that promotes, empowers, and broadens activity by others to protect the

environment. This role must be carefully expanded if EPA is to move

beyond its traditional role as regulator of first resort. Community

Right-to-Know is among the most successful alternatives to command and

control approaches, and EPA believes that it provides an important

foundation for new alternative performance-based management systems.

For example, EPA is developing programs to increase community

participation and partnerships to move environmental decision-making

closer to the source of problems and solutions. Community access to

meaningful information is an important ingredient for the success of

this approach. Agency efforts to encourage more flexible approaches,

such as the Common Sense Initiative

[[Page 51326]]

and Project XL, also require the right set of information to measure

and understand environmental results. EPA's Common Sense Initiative

involves multi-stakeholder groups looking for industry-specific

``cleaner, cheaper, smarter'' approaches to environmental protection,

and sector groups have discussed the value of materials accounting

data. EPA's Project XL (for excellence and leadership) is intended to

encourage innovation and flexibility in meeting higher environmental

performance standards. Stakeholders in Project XL and CSI have

indicated that chemical use information would facilitate progress in

these projects as well. In sum, while the TRI-Phase 3 project involves

a number of difficult issues, continued development of this chemical

use project will have benefits across the Agency.

II. Key Issues and Request for Information

EPA has classified TRI-Phase 3 issues into five major categories

based on stakeholder comments to date. EPA encourages all interested

persons to submit comments on these issues, and to identify any other

relevant issues as well. This input will assist the Agency in

developing a proposed rule that successfully addresses information

needs while minimizing potential reporting problems associated with

chemical use information. EPA requests that commenters making specific

recommendations include supporting documentation where appropriate.

A. Questions about the Premise for and Utility of Chemical Use

Information

A fundamental TRI-Phase 3 issue is the usefulness and need for

chemical use information. There is substantial disagreement among

stakeholder groups on this question, and EPA solicits additional

comments and examples. The two areas of use information are described

below:

1. Materials accounting information. Environmental and public

interest groups contend that while TRI is an extremely valuable tool,

it falls short of providing the complete right-to-know picture needed

to fully understand toxic chemical issues. These groups have suggested

materials accounting data as the best remedy for addressing these

issues. Based on stakeholder input, EPA has identified the following

Right-to-Know ``data gaps'': (1) The need for information on the flow

and use of toxic chemicals at a facility; (2) the need for tracking

toxic chemicals in products; (3) better information on occupational

issues; (4) the need to create a ``scorecard'' for measuring and

promoting pollution prevention/source reduction; (5) the lack of a

ledger check on TRI estimates; (6) the need to improve TRI to serve as

a better tool for regulatory integration efforts; and (7) other uses

such as research and priority-setting.

Industry and trade association commenters disagree and contend that

chemical use information is of limited value. These groups have

presented the following arguments against the merits and need for

collecting materials accounting information: (1) Chemical use reporting

is based on a false premise that any type of chemical use is harmful

and should be eliminated; (2) a convincing argument has not been made

as to the utility of materials accounting data to the public; and (3)

materials accounting data does not in fact allow more accurate

measurement of source reduction progress. EPA recognizes that some

companies routinely collect materials accounting data as a way of

monitoring their operations. These firms use the data internally to

reduce chemical losses, improve product yield, and to manage their

materials. EPA recognizes that this is not a universally accepted

business practice and could be more appropriate for some industries

than for other industries.1

---------------------------------------------------------------------------

1EPA is specifically requesting comment on the costs associated

with materials accounting data collection and concern associated

with sensitive or confidential business information.

---------------------------------------------------------------------------

Some stakeholders from the industrial, environmental and state

regulatory communities have indicated that materials accounting data

are useful for looking at a variety of important environmental issues.

For example, chemical inputs can be compared with existing TRI releases

and wastes to examine the efficiency of facility chemical use over

time. This may provide important pollution prevention insights. Knowing

that 38 percent of the chemical input at a hypothetical chemical

processing facility goes into the release and waste stream, and that

the percentage has been increasing over time is valuable information,

for facility managers, for state and EPA regulators, and for

communities interested in looking at pollution prevention performance.

It should be noted however, it is not yet clear to what extent the

inaccuracies inherent in such data may limit it's usefulness for this

purpose. Supporters of the Right-to-Know Program believe that this is

the best approach currently available and better than the current gap

in information. Access to such information facilitates dialogue on

approaches that rely on preventing the generation of pollution over

those that rely on more traditional end-of-pipe solutions. In the long

run, the pursuit of strategies that improve efficiency are more likely

to enhance the viability of affected facilities, and the success of the

surrounding communities as well. Additional examples regarding the flow

and use of toxics through communities and the value of product stream

data can be found in EPA Issues Papers #1 and #2 (Refs. 3 and 4).

While materials accounting data may provide important insights to

the Agency, the public, and to industry, EPA acknowledges that further

evaluation is needed. EPA requests additional comments that provide

greater detail on how the public would use materials accounting data.

EPA also welcomes comments that take issue with the need for use data,

or challenge its information value. The Agency will use the comments to

perform a more comprehensive review of the premise for use reporting.

2. Occupational exposure indicator information. The manufacturing,

processing, and use of chemicals also involves workers; and

environmental and labor groups have recommended that data elements be

included to describe this aspect of chemical use. Workers are also

community members, and there is increasing interest in the link between

occupational exposure and environmental performance as well. Data on

the worker demographics at a facility can be viewed as part of the core

data set needed to characterize a facility. The data elements

describing the number of workers, providing basic estimates on the

number of potentially exposed workers, and indicating the extent to

which employee exposures have been assessed would enhance the

usefulness of TRI. Industry commenters agree that worker exposure which

may be tied to adverse effects should be monitored closely and provided

to workers, but have suggested that the issue be deferred to agencies

such as the Occupational Safety and Health Administration (OSHA) and

the National Institute for Occupational Safety and Health (NIOSH).

Industry stakeholders have also suggested that some data are already

available through OSHA and NIOSH. Preliminary discussion with these

agencies indicates that they support efforts by EPA to collect this

information and put it in the public domain. EPA is interested in

additional commentary and examples related to occupational exposure

indicator issues.

In summary, EPA requests additional comments on the premise for

chemical use information and its value to the

[[Page 51327]]

different sectors of the public. In addition to commentary, the Agency

requests that hypothetical or actual examples be submitted. EPA is also

interested in comments that distinguish between direct application of

chemical use data (e.g., using chemical input or output to look at the

flow of toxics through a community) and derived applications where the

data are combined with other information to develop a measurement

(e.g., combining chemical input with release and waste data to address

efficiency). Several questions are provided below:

1a. Do gaps exist in the current Right-to-Know Program? Do chemical

use data serve or not serve to fill right-to-know gaps identified by

stakeholders? Provide examples that will support your position. EPA is

interested in perspectives ranging from the community and facility

level up to the national level.

2a. Are any individual chemical use data elements viewed as more

useful than others?

3a. Can facility environmental performance be judged based on

existing publicly available environmental data? EPA is interested in

examples where data users could/ could not judge facility performance.

Is chemical use information seen as improving understanding and

accountability?

4a. If chemical use information were available to the public, how

would the public utilize this data? For example, what actions could a

community take with a better system to track pollution prevention or

the flow of toxics into and out of a neighborhood? Would there be the

potential for serious misuse of the data?

5a. How have chemical use data been applied by the public in New

Jersey and Massachusetts, where such reporting is already required? Has

the public in other states ever requested chemical use information from

facilities? If so, how was it used?

6a. What concerns are there about misuse, misunderstanding, or

misinterpretation of chemical use data by the public? What is the basis

for these concerns? Which specific data elements are most subject to

potential misunderstandings about a facility? How should these concerns

be considered in developing this initiative? EPA is also interested in

any examples of misuse and misinterpretations resulting from the

availability of this information in New Jersey and Massachusetts.

7a. Have industry and community organizations engaged in dialogue

about issues such as pollution prevention performance, toxics in

products, flow of toxics through communities, or the need for

accountability to support the use of flexible approaches to

environmental protection? If so, what information was seen as helpful?

8a. How could occupational indicator data be used by various

groups, including at the community level? Do other sources of data

exist (e.g., OSHA's Hazard Communication Standard) that could fill this

informational gap? EPA is interested in stakeholders views on the role

of TRI and its relationship to worker safety and health performance,

including the number of potentially exposed workers and environmental

performance, and the appropriate linkage between them.

9a. What are the views of state environmental representatives about

the utility of chemical use information? What experiences have states

had in measuring pollution prevention efforts? What might the

advantages and/or disadvantages be of having materials accounting data

collected nationally rather than at the state level? EPA welcomes state

perspectives on TRI-Phase 3 issues.

10a. Should EPA conduct a national pilot program to collect

materials accounting data on a limited number of chemicals as

recommended by the NAS report?

11a. What methodologies are available for quantifying the benefits

of chemical use data? Could the relative use levels of data from New

Jersey and Massachusetts be used to develop a measure of willingness to

pay for the data? EPA welcomes comments from potential users of the

data on their own willingness to pay. EPA is also interested in

examples from New Jersey and Massachusetts on the savings versus costs

of collecting and using materials accounting data.

B. Agency-wide Environmental Reporting Issues

Industry commenters have raised several issues concerning the

relationship between TRI-Phase 3 and Agency-wide reporting policies.

One comment is that the Agency may already collect certain types of

chemical use data under other programs, and that EPA should explore how

it could integrate such data into TRI before calling for additional

reporting. This perspective appears to suggest that chemical use data

gaps can be addressed with improvements in internal EPA data

management. Another issue is the relationship between the TRI-Phase 3

project and EPA efforts under the National Performance Review

``Reinventing Environmental Regulation'' project, which includes goals

for reducing reporting burdens. EPA's objective is to identify and

eliminate unnecessary burden so that resources dedicated to data

collection can be focused on information considered more useful. The

need to reduce overall reporting burden does not preclude all efforts

to expand reporting. However, given the overall need for reduction,

some commenters have inquired as to how chemical use data compares in

priority with other types of environmental information across the

Agency. Environmental stakeholders have asserted that the need to

streamline current reporting requirements should not be confused with

the need to collect the appropriate set of data on facility

environmental performance. These groups have expressed confidence that

materials accounting data are part of any core data set needed for

performance review. EPA will be evaluating these environmental

reporting issues further as part of TRI-Phase 3. In the meantime, the

Agency encourages interested persons to submit comments on TRI-Phase 3

reporting issues. Several questions are provided below:

1b. Which existing EPA or other Federal agency data sources do

stakeholders view as providing information equivalent to materials

accounting and other chemical use data? The Agency is especially

interested in perspectives of facility personnel filling out

environmental reports, and members of the public and environmental

groups who use EPA data.

2b. Please provide examples of existing sources of chemical use

information which have been or could be used to examine data gap issues

such as tracking pollution prevention, the flow of toxic chemicals

through communities, and product stream issues. Please provide

suggestions for improving access to such data and how these data could

be used.

3b. Please comment on how materials accounting data can be used as

a basis for streamlining multi-media permitting or similar efforts.

Would the collection of materials accounting data replace the need to

collect data currently being collected by EPA? If so, which data?

4b. For all of the above, how should EPA address situations where

use data from other internal data bases have value, but the scope of

chemical or facility coverage differs so that the end result would be

an incomplete TRI data base?

[[Page 51328]]

C. Impacts on Confidential Business Information (CBI)

Preliminary information provided by industry groups has been

helpful in clarifying the set of issues related to CBI concerns.

Industry is concerned that public dissemination of chemical use data

collected under TRI-Phase 3 would result in release of CBI. They

believe that access to chemical use information would provide

competitors with the opportunity to extract sensitive product, process

and economic information about a company. They are concerned that this

would, in turn, put American companies at a competitive disadvantage

and cause them to lose world-wide market share.

Environmental stakeholders recognize potential release of CBI as a

legitimate concern, but are less certain about the magnitude and

frequency of the problem. They contend that there is no indication that

existing TRI data have been used for industrial espionage.

Additionally, they assert that there have been no examples where

materials accounting reporting has resulted in a loss to industry,

specifically in New Jersey and Massachusetts where materials accounting

information is collected by the state.

EPA agrees that the potential for loss of sensitive business

information is a legitimate issue that must be addressed in order for

chemical use reporting to move forward. EPA requests additional

information describing and listing the different types of losses that

are of concern to industry, so that the Agency can perform a more

comprehensive review. For example, EPA is interested in the sequence by

which materials accounting and other chemical use data, by itself or in

combination with other environmental data, can be used by competitors

to reveal sensitive business information. EPA also seeks additional

information on conditions that could either contribute to or alleviate

these concerns. For example, manufacturing facilities producing large

numbers of different products might not have the same CBI concerns as

smaller facilities producing only a few products. The volume of

products and production lines might serve to mask the use information.

Similarly, a facility using a toxic chemical in a variety of processes

might not have the same CBI concerns of a facility producing or using a

unique chemical or a distinct manufacturing process which requires a

specific chemistry.

Case reports or studies that will allow the Agency and other

stakeholders to understand and verify how losses occur would be

especially useful. Such information will assist the Agency in

developing common-sense approaches to CBI issues. For example, the

Chemical Manufacturers Association (CMA) commissioned a study by Kline

Company to develop a business profile of an actual facility using

publicly available information supplemented by materials accounting

data. (CMA has provided EPA with a copy and it has been placed in the

docket.) The study concluded that the materials accounting data were

useful for developing an overall profile, although they were considered

less useful than data from Clean Air Act (CAA) permit filings. The

study helps to characterize the categories of losses considered

important by industry. EPA is interested in receiving similar studies,

and recommends that background information be included to allow a

better understanding of the basis for conclusions. EPA is interested in

the relative value of each materials accounting data element for the

extraction of sensitive business information, the role and contribution

made by other types of environmental data, and the impact of various

safeguards in protecting CBI. The Agency is also interested in any

differences in CBI issues among industry sectors. EPA invites comments

on the following specific questions:

1c. What business loss categories (e.g., reverse engineering of

product line, revealing of cost structure) does industry associate with

public disclosure of materials accounting data? How do the categories

rank in importance? For each category, which data elements are

involved, and what is the sequence by which the information is used by

competitors to transform the data into a competitive gain?

2c. Which loss categories are associated only with materials

accounting data? What additional loss categories can result when

materials accounting data are combined with other environmental data

(e.g., Clean Air Act or Clean Water Act permit data)? What are the

other types of data, and what is the sequence by which they can be used

by competitors to reveal CBI?

3c. Have any cases been identified in New Jersey or Massachusetts

where CBI loss was linked to public access to materials accounting

data?

4c. Which of the materials accounting data elements is of most

concern? What suggestions do CBI or Right-to-Know experts have for

modifying materials accounting data elements to better protect CBI

while still preserving public access to relevant chemical use data?

5c. To what extent do CBI issues vary by industry sector?

Preliminary information indicates that the potential for business

losses might be more of an issue for chemical manufacturers than for

chemical users. EPA requests comment on this question. Do sector-

specific differences offer any strategies for safeguarding CBI?

6c. If other EPA data play a significant role (when combined with

materials accounting data) in loss of CBI, what suggestions do

stakeholders have for changes to other data systems to improve

protection of CBI?

D. Cost Estimates

EPA believes that some of the raw data used as the basis for

materials accounting will typically be generated or used in the normal

course of business by many firms. EPA is interested in identifying

which data are already routinely collected, which data that might be

required for materials accounting are not already collected, the steps

and factors involved in transforming the raw data into chemical-

specific materials accounting and other use information, and the costs

associated with this process. EPA is also interested in the extent to

which firms already assemble materials accounting data. In some cases,

full materials accounting data may already be routinely collected. In

other cases, partial data, such as chemical inputs, may be collected at

a facility in order to document that they exceed the 25,000 pound a

year EPCRA section 313(f)(1) reporting threshold for manufacture or

process activities, and/or the 10,000 pound a year threshold for

otherwise use activities. In other cases, facilities may be collecting

use information because they are using mass balance methods to estimate

TRI releases. Where partial materials accounting data are already

collected, the Agency is interested in steps and costs associated with

collecting the additional materials accounting data, such as amounts

consumed on-site and amounts shipped off-site in products. EPA

encourages facilities that currently report under state programs in New

Jersey and Massachusetts, or that currently collect materials

accounting data for their own business purposes, to submit cost

information for review. Estimates that include a general facility

description (e.g., manufacturer versus processor, number of forms

submitted), that address other uses of the data, and that provide

estimates per chemical report form will be most helpful. A list of

questions follows:

1d. What are the steps involved in gathering materials accounting

data,

[[Page 51329]]

starting with the basic cost and operations data collected in the

normal course of business? Are there obstacles in collecting this

information? EPA is interested in descriptions for each data element,

the estimated costs for each step, and a description of the obstacles

and any remedies to address identified obstacles.

2d. What would be the steps and costs for facilities that already

collect and use materials accounting information?

3d. How many facilities collect basic cost and operations data that

can be used to generate partial or full materials accounting data? How

many facilities currently generate partial or full materials accounting

data?

4d. It has been suggested that while facilities which do not

currently gather materials accounting data will likely have higher

costs, these facilities would also be expected to derive the greater

benefit and savings offsets from the inherent value of the information.

Others argue that facilities which do not currently collect such data

may be those for which the data has the least value, or for which

collecting it would be particularly difficult or expensive. EPA is

interested in comments and examples on how this issue should be

treated.

5d. Please provide existing cost estimates based on facility

experiences in New Jersey and Massachusetts, or from other facilities

where materials accounting data are collected as a good business

practice.

6d. EPA is interested in information regarding both first year

start-up costs and annual costs once a system is set up.

7d. EPA requests information on variations in cost. For example,

are there any particular materials accounting data elements that are

more costly than the others? How does the number of uses affect costs?

How does the number of products in the product stream affect costs? Do

costs differ among use sectors, especially for otherwise users who

should not need to report on amounts consumed or put into the product

stream?

8d. EPA requests comment on the potential costs to small businesses

of collecting materials accounting data and on what factors EPA should

focus in further developing this project so that these costs are

minimized, e.g. facility size, employees, revenue, etc.

9d. TRI provides a number of reporting exemptions and modifications

such as the alternate threshold reporting modification, de-minimis

exemption, article exemption, laboratory exemption, structural

component exemption, etc. How would these reporting exemptions and

modifications impact the collection and utility of materials accounting

data if EPA were to expand TRI to collect chemical use information?

What role could reporting exemptions and modifications play in

alleviating the reporting burden to small businesses?

E. Technical Collection and Interpretation Issues

Stakeholders have raised technical questions about the mechanics of

materials accounting and occupational exposure indicator reporting, and

the precision and appropriate interpretation of the results. Topics

range from the conceptual to the practical and include the following:

(1) The activities that need to be accounted for to measure source

reduction; (2) the mechanics of using materials accounting to measure

source reduction, and the degree to which it improves upon the current

TRI-based methods; (3) the role of normalization in the measurement of

source reduction; (4) the mechanics of product stream reporting; (5)

appropriate comparisons of materials accounting data between

facilities; (6) the basis for estimating ``potentially exposed

workers''; and (7) the need for definitions for certain terms. EPA

requests comments on these and other technical measurement and

reporting issues. The Agency is also interested in alternative data

element options and suggestions for safeguards that balance CBI and

Right-to-Know. Specifically, EPA is soliciting information on the

following:

1e. EPA is not aware of any major technical reporting or

interpretation issues arising out of state requirements in New Jersey

or Massachusetts that need to be addressed as part of TRI-Phase 3.

Please provide information on any state reporting issues that should be

considered relevant to TRI-Phase 3.

2e. Please provide any suggestions for additional data element

options, along with rationale for why they should be considered.

3e. To what extent should EPA identify formulas that can be used to

derive performance measures using materials accounting data? If some

data gaps are best filled with derived measures, should EPA consider

reporting of the measure instead?

4e. Are caveats needed when materials accounting data from two or

more different facilities are being compared? If so, what are they?

III. Plans for Evaluation and Proposal Development

In addition to evaluating the public comments submitted in response

to this Notice, EPA will also take the following additional steps to

evaluate several key issues.

A. EPA Evaluation Activities

EPA is taking steps to examine the following issues as part of its

evaluation of TRI-Phase 3 issues.

1. Comprehensive review of existing EPA data collection programs.

EPA will take a closer look at existing data bases to identify and

evaluate sources of chemical use data already being collected by the

Agency as well as data available from other Federal agencies such as

OSHA and DOT. The purpose is to examine whether improving access to

existing data might provide an effective alternative to new reporting

requirements. The evaluation will include looking at the scope of

facility and chemical coverage, and factors related to integration of

the existing data into TRI. The review will also address: linkages

between TRI-Phase 3 and the TSCA Inventory Update Rule expansion;

coordination with the Agency One-Stop Reporting initiative; and the

potential for using materials accounting to integrate regulatory

requirements. EPA believes that TRI-Phase 3 and the TSCA Inventory

Update Rule Amendments can be designed so that any overlap between them

is minimal. However, the Agency will track this issue as the two

projects are developed further. In addition, EPA will ask for public

comment on how to minimize any overlap when the TSCA proposed rule is

published.

2. Evaluation of New Jersey and Massachusetts materials accounting

programs. EPA will review the impact that materials accounting

reporting has made in these two states. EPA will look at who is using

the data and for what purpose. The Agency also plans to examine the

state program experience with CBI in order to learn more about the

effectiveness of various approaches to protect CBI, and the potential

impacts that are associated with loss of CBI. EPA also plans to examine

the economic effects of the state programs, including reporting costs

and qualitative and quantitative estimates of benefits from collecting,

evaluating, and using the data.

3. Evaluation of CBI issues. EPA also plans to examine other

aspects of the CBI issue in greater detail. The Agency will evaluate

existing reports on this subject (e.g., the Kline Report), and will

examine the relationship between specific data elements and the

potential for loss of sensitive business information. EPA will also

assess the adequacy and value of different mechanisms for protecting

CBI.

[[Page 51330]]

4. Review of occupational exposure indicator issue with OSHA and

NIOSH. EPA will continue its consultation with its occupational agency

partners to discuss the utility of occupational exposure indicator

information, and whether it is appropriate for EPA to collect it and

make it available via TRI. EPA will also review alternative options for

making this information available to the public.

B. Public Meetings

EPA will hold two 1-day public meetings, one in Boston, MA and one

in Baton Rouge, LA to discuss the issues presented above. The tentative

agenda for these public meetings will include a discussion of the

issues presented in Unit II. of this ANPR. Specific information on

these public meetings is contained in a Notice of public meeting

published elsewhere in this issue of the Federal Register. Information

from all public meetings will be placed into the TRI-Phase 3 docket.

C. Examination of Data Elements, Reporting Vehicles, and Formats

After reviewing public comments, internal evaluation results, and

after further consideration of reporting vehicles, EPA will examine

whether additional data element options can be, or need to be developed

for consideration as part of any proposal. The Agency believes that

careful selection of data elements and reporting features is essential

to optimizing the Right-to-Know value of chemical use information while

avoiding reporting problems. EPA is open to development of new

combinations of data elements, and intends to examine whether

additional types of reporting options and data elements might play a

role in addressing concerns.

IV. Rulemaking Record and Electronic Filing of Comments

A record has been established for this ANPR under docket number

``OPPTS-400106'' (including comments and data submitted electronically

as described below). A public version of this record, including printed

paper versions of electronic comments, which does not include any

information claimed as CBI, is available for inspection from noon to 4

p.m., Monday through Friday, excluding legal holidays. The public

record is located in the TSCA Nonconfidential Information Center, Room

NE-B607, 401 M St., SW., Washington, DC 20460.

Any person who submits comments claimed as CBI must mark the

comments as ``confidential,'' ``CBI,'' or other appropriate

designation. Comments not claimed as confidential at the time of

submission will be placed in the public file. Any comments marked as

confidential will be treated in accordance with the procedures in 40

CFR part 2. Any person submitting comments claimed to be confidential

must prepare a nonconfidential public version of the comments in

triplicate that EPA can place in the public file.

Electronic comments can be sent directly to EPA at

[email protected]. Electronic comments must be submitted as an

ASCII file avoiding the use of special characters and any form of

encryption. The official record for this action, as well as the public

version, as described above will be kept in paper form. Accordingly,

EPA will transfer all comments received electronically into printed

paper form as they are received and will place the paper copies in the

official record which will also include all comments submitted directly

in writing. The official record is the paper record maintained at the

address in ADDRESSES at the beginning of this document.

V. References

1. PCSD. Sustainable America - A New Consensus for Prosperity,

Opportunity, and a Healthy Environment for the Future. The President's

Council on Sustainable Development, Washington, DC (1996).

2. USEPA/OA. The New Generation of Environmental Protection - EPA's

Five Year Strategic Plan. U.S. Environmental Protection Agency,

Washington, DC (1994).

3. USEPA/OPPT. Issue Paper #1: Expansion of the Toxics Release

Inventory to Gather Chemical Use Information: TRI-Phase 3: Use

Expansion. U.S. Environmental Protection Agency, Washington, DC (1994).

4. USEPA/OPPT. Issue Paper #2: Expansion of the Toxics Release

Inventory to Gather Chemical Use Information: TRI-Phase 3. U.S.

Environmental Protection Agency, Washington, DC (1995).

5. USEPA/OPPT. Issue Paper #3: Expansion of the Toxics Release

Inventory to Gather Chemical Use Information: TRI-Phase 3. U.S.

Environmental Protection Agency, Washington, DC (1996).

6. USEPA/OPPT. Report to President Clinton - Expansion of Community

Right-to-Know Reporting to Include Chemical Use Data: Phase III of the

Toxics Release Inventory. U.S. Environmental Protection Agency,

Washington, DC (1995).

VI. Regulatory Assessment Requirements

Pursuant to Executive Order 12866 (58 FR 51735, October 4, 1993),

it has been determined that this ANPR is ``significant'' because it may

raise novel legal or policy issues arising out of legal mandates and

the President's priorities. This action was submitted to OMB for

review, and any comments or changes made during that review have been

documented in the public record.

In the event that EPA decides to issue a proposed rule (or rules)

to expand its Community Right-to-Know program to include additional

chemical use information, EPA will need to comply with a number of

additional statutory and regulatory requirements. The exact

requirements will vary depending on the specifics of the proposed

rule(s). However, among the additional requirements with which EPA

might need to comply are the Paperwork Reduction Act, the Unfunded

Mandates Reform Act, and the Small Business Regulatory Enforcement

Fairness Act. In addition, EPA might need to comply with the Executive

Orders 12875, Enhancing the Intergovernmental Partnership; 12866,

Regulatory Planning and Review; and 12898, Federal Actions to Address

Environmental Justice in Minority Populations and Low-Income

Populations. In preparing any proposed rule(s) contemplated by this

ANPR, EPA will develop the analysis necessary to satisfy these other

requirements, as well as comply with the procedural steps mandated by

the underlying statutes, regulations, and Executive Orders.

List of Subjects in 40 CFR Part 372

Environmental protection, Community right-to-know, Reporting and

recordkeeping requirements, Toxic chemicals.

Dated: September 25, 1996.

Carol M. Browner,

Administrator.

[FR Doc. 96-25012 Filed 9-30-96; 8:45 am]

BILLING CODE 6560-50-F