8/7/2019 American Coatings Association Letter to Chairman Issa - January 10, 2011

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.-. AmericanCoatingsASSO CIATIO NJanuary 10,2011

The Honorable Darrell IssaChairmanCommittee on Oversight & Government ReformU.S. House of RepresentativesWashington, DC 20515Dear Chairman Issa:On behalf of the American Coatings Association (ACA), thank you for the opportunity to identifyproposed pr existing regulatioJ")s that are negatively impacting our industry and our continuedability innovate in a globally competitive economy.As you pursue the larger reform agenda, we believe that some concrete oversight action isneeded on the following areas of health, safety and environmental policy being actively pursuedby the current administration. While ACA will continue to pursue all available redress for ourconcerns, we welcome your consideration and support, in particular as the nation seeks toexpand what appears to be an emerging but still fragile economic recovery .DOT Special PermitsIn order to obtain a Special Permit, applicants must submit an application containing specificinformation regarding transporting the hazardous material at issue . US DOT is required tomake a finding that the applicant is "fit" prior to granting a Special Permit. During 2009, thePipeline and Hazardous Materials Safety Administration issued guidance which substantiallychanged the criteria upon which a "fitness determination" is made. The guidance, however,articulates criteria that appears to be beyond PHMSA's authority and, in addition, does notarticulate what constitutes fitness or a finding of "unfit."ACA is signatory to a coalition effort designed to convince PHMSA to initiate a rulemaking toarticulate the fitness criteria more clearly. This petition for rulemaking was filed in midDecember.In addition, the coalition has also sought a legislative amendment to the Hazardous MaterialTransportation Act (it is up for reauthorization) to require PHMSA to establish fitness criteria fora Special Permit by rulemaking. Representative Graves (R-MO), Chair of Small BusinessCommittee, has indicated his support for such an amendment and has drafted such legislation.It has not been introduced. The desired solution is a rulemaking to establish these criteria. Thiscan be accomplished by PHMSA responding positively to the petition for rulemaking. It couldalso be accomplished by the Graves Amendment. At this point in time, PHMSA has indicatedthat a rulemaking is appropriate yet there is no evidence that a rulemaking has been initiated.

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The final rule issued earlier this week (HM-233B) did not address the fitness criteria . It didaddress information that is required to be included in the application. The final rule requiressignificantly more information on the application and makes the process more complex. Thereis a significant backlog of applications and renewal applications (over 2500) at PHMSA and thisfinal rule will only add to that backlog .National Aerosol Coatings RuleThe national rule for aerosol coatings contains a very short list of compounds (169) that can beused in aerosol coatings formulas. This is in contrast to the California rule where the Table ofMIR Values contains over 800 (and soon will be expanded to include over 1200). If a companywants to use a compound that is not on the EPA list, the unlisted compound must be assigned adefault value of 22.04 , regardless of the actual MIR value on the ARB Table. A default value of22 .04 makes it impossible for any formulator to use an "unlisted EPA compound."We have petitioned EPA to add compounds to this list and at least one of these petitions wasfiled over a year ago. EPA has not responded; even to acknowledge the filing of the petition.The aerosol coatings regulation should be amended to include a mechanism to add compoundsto this ' list more efficiently. As it currently stands, in order to add compounds to the list, it mustbe done in a fuB-blown rulemaking wah a NPRM, notice and comment, etc. As you know, thistakes EPA years to complete. In the meantime, formulators are prevented from using thesecompounds that have been tested and assigned reactivity values in the California rule.EPA Boiler MACTThe Environmental Protection Agency (EPA) has proposed a rule that would establishstringent emissions standards on industrial and commercial bo ilers and process heaters (i.e.Boiler MACT). This broad-reaching proposal will directly impact paint manufacturers with newboiler operating and compliance costs with resultant i m p ~ c t s on economic recovery and jobs inthe industry. Recognizing the significant impacts of its initial proposal, EPA has asked thefederal District Court for the District of Columbia for an extension to re-propose the rule. Whilethis may be taken as a hopeful sign, any new EPA proposal must ensure that the standards areeconomically feasible and achievable in practice for all manufacturers that operate boilers .EPA NAAQS for OzoneThe EPA in January 2010 issued a proposal to tighten the National Ambient Air QualityStandards (NMQS) for ground-level ozone standard from tihe existing 75 parts per billion (ppb)to a range between 70 ppb and 60 ppb. ACA's longstanding concern with such a move is theimpact on many of our industry's products which necessarily contain some volatile organiccompounds (VOC's), precursors to ozone formation, which are used to protect the substratesupon which they are applied. Often in the debate on tightening air quality standards the EPAhas not fully considered the life-cycle impacts of their proposals including the potential impacton the efficacy of the reformulated products and their ability to forestall deterioration of ournation's infrastructure. While our industry continues to innovate and find ways to reduce VOCemissions and maintain product quality, these far-reaching proposals by the agency may proveimpossible to meet. We believe it is important that any action by EPA to reduce the ozonestandard weigh the health and environmental benefits as well as the economic andinfrastructure impacts.

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OSHA On-Site ConsultationThe Occupational Safety and Health Administration (OSHA) has recently moved to a moreadversarial approach toward business, issuing enforcement notices as a result of employers, inparticularly small businesses, seeking to consult with OSHA to better understand and complywith existing workplace safety standards . As a result, businesses will likely cease reaching outto OSHA for help and be less likely to cooperate with OSHA programs seeking to fosterimproved compliance.OSHA Noise ProposalOSHA recently indicated that it plans to enforce noise level standards by redefining what isdeemed "feasible" for employers to do in their workplace using engineering controls, unless anemployer can show the effort is not feasible (i.e. will "put them out of business" .) OSHA'sproposal would alter a long-running and effective policy that allows employers to useadministrative controls (limit exposure times) and provide "personal protective equipment," suchas ear plugs and ear muffs, if they are more cost-effective than engineering controls . Suchchanges would need to be made by employers of all sizes, regardless of their costs. OSHA ispursuing this change outside the formal rulemaking process and, as such, and has not providedopportunity for input from the regulated community.OSHA Injury and Illness Protection ProgramOSHA is also developing a new regulation that would mandate a standard for employers'Injury and Illness Prevention Programs (12P2) . The regulation is expected to be proposed in thespring of 2011 and would have sweeping ramifications on all aspects of both workplace safetyenforcement and the promulgation of new regulations. ACA believes the efforts made byemployers operating effective safety and health programs should not be disrupted by this newmandate.Cleaning Product Claims Policy under FIFRA at EPA, .ACA continues to explore its options and coordinate activities with other industry tradeassociations with an interest in amending the EPA new guidance on cleaning product labels.The new agency guidance changes longstanding practice that allowed cleaning products tomake label claims regarding cleaning of mold and mildew stains, instead requiring thatcleaning products making such claims be registered as pesticides under the Federal InsecticideFungicide and Rodenticide Act (FIFRA). This has the potential to affect companies thatmanufacture or distribute cleaning products required for surface preparation prior to theapplication of new finishes. FIFRA registration of a pesticide product is a detailed and costlyregulatory requirement that requires specialized knowledge and expertise, and failure toconform properly carries significant penalties. This change in "agency guidance" can result insignificant adverse impacts to industries relying on longstanding practices.TSCA Inventory Update RuleOn August 16, 2010 EPA issued a Notice of Proposed Rulemaking (NPR) to amend the currentInventory Update Rule (IUR) which serves to direct the collection of information on chemicalmanufacturing, import, and processing activities in the US. The proposed rule is a dramaticdeparture from current practice as it expands the scope of the rule, requiring additionalinformation on an increasingly broad array of chemical manufacturing activities, but also will

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compel more affirmative efforts on the part of raw material (chemical) suppliers to secureinformation from their customers on their use chemicals . This latter activity would move forwardwithout the opportunity, as the current regulation provides, for claims of confidential businessinformation (CBI). ACA has commented on the proposal , seeking to re-establish longstandingpractice in this area.

Once again, we thank you for the opportunity to provide our input and we look forward to acontinued dialogue with you and your committee about these important regulatory policymatters.

Sincerely,

J. Andrew DoylePresident and CEO

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