California has imposed stringent new limits on formaldehyde emissions from composite wood products and finished goods. The new standards will apply to manufacturers, distributors, importers, fabricators, and retailers.

The regulations will cap emissions on all such products sold in California.

The regulations will be implemented in two phases, beginning January 1, 2009. The California Air Resources Board (ARB) estimates that costs to manufacturers to implement Phase 1 will be $19 million per year. Costs

for Phase 2 are estimated to be $127 million per year. This represents an estimated increase in production costs of between 1% and 7% for Phase 1, and between 8% and 30% for Phase 2.