Following the release last week of our Firm Clients and Friends Memorandum "Summary of Changes in the Chemical Safety Improvement Act (CSIA, S. 1009) and the Boxer TSCA Version Released September 18, 2014," Bergeson & Campbell, P.C. (B&C^®) received copies of a number of documents relating to what is now described as the "Udall-Vitter Discussion Draft" (U-V DD) of the original CSIA (CSIA1). The documents obtained include:

• A version of the clean, revised text of U-V DD, which is identified as a "Senate Legislative Counsel Document." While potentially of interest, the status of this document is not clear insofar as it was never issued per se as a Discussion Draft. We also note that, based on a quick inspection, it contains a number of changes to section/subsection numbering and wording which could prove confusing in comparison to the various redline documents that we and others have released.
• A redline version showing final changes to the text in comparison to CSIA1, which is entitled "Udall-Vitter Draft Revisions to S. 1009 (September 2014)." This version is slightly different from the "Staff Working Draft CSIA Revisions 07 31 2014" (July 31 Staff Draft) version that had been released by Senator Barbara Boxer (D-CA) along with her changes (we had identified this document as "Boxer TSCA" in our initial Memorandum); this is also the final version of the document that B&C had recreated as part of our analysis of the changes discussed in the initial Memorandum.
• A document responding to a February 5, 2014, letter from 11 Democratic Senators to Senator David Vitter (R-LA) identifying key issues and concerns with CSIA1. The signatories to the letter consisted of Thomas R. Carper (D-DE), Michael F. Bennett (D-CO), Sherrod Brown (D-OH), Christopher A. Coons (D-DE), Martin Heinrich (D-NM), Carl Levin (D-MI), Claire McCaskill (D-MO), Christopher S. Murphy (D-CT), Jeanne Shaheen (D-NH), Debbie Stabenow (D-MI), and Mark E. Udall (D-CO). The undated response goes through each of the nine issues identified and provides a summary of the approach in U-V DD that responds to each issue/concern. The February 5, 2014, letter has also been released since our initial Memorandum was issued.
• A document that summarizes "10 key enhancements" made to CSIA1 to respond to issues raised about the bill.
• What seems to be a draft press statement describing the release of U-V DD. The statement is entitled "Pragmatic Compromises to Revise the Chemical Safety Improvement Act Yields a Stronger Draft Bill with Growing Support."

This Memorandum briefly summarizes these documents (which are included as linked attachments), reviews, and analyzes the changes made in developing the final version of U-V DD.

Legislative Text and Redline Versions of U-V DD

The only changes made to U-V DD relative to the July 31 Staff Draft are to add the text of Section 18(e)(6)(B) Judicial Review of Prioritization Screening Decision and create a new subsection (A) In General containing unrevised text from the July 31 Staff Draft. In our previous analysis, we had identified Section 18(e)(6)(B) as a subsection that was cross-referenced but missing from the text. The cross-reference appears in U-V DD at Section 4A(d) Final Agency Action which states that "[e]xcept as provided in section 18(e)(6)(B)" any action under Section 4A shall not be considered a final agency action or subject to judicial review. Section 18(e)(6)(B) states that following a U.S. Environmental Protection Agency (EPA) decision to designate as a low priority a chemical recommended under Section 4A(c) by a State Governor or agency, the Governor or State agency may file a petition for judicial review within 60 days. With this change at least one of the actions taken by EPA under Section 4A would be judicially reviewable.

Response to the February 5, 2014, Letter from 11 Democratic Senators

The letter had identified nine specific areas in CSIA1 that were in need of revision. The areas identified plus the responses to each included the following:

• Further clarify the definition of the safety standard to ensure that all safety decisions are made solely on consideration of risk to health or the environment, without consideration of cost or economic factors.
  • U-V DD explicitly prohibits EPA from considering non-risk factors in this determination and requires protection of "potentially exposed or susceptible populations" as well as the general population.
• Ensure that protection of vulnerable populations is analyzed when assessing chemicals and is taken into account when making risk management decisions.
  • U-V DD includes a new definition of "potentially exposed or susceptible population" which includes vulnerability due to related exposures and heightened susceptibility, and includes but is not limited to the specifically identified populations such as infants, children, etc. The new draft also requires protection of "potentially exposed or susceptible populations" as part of the safety standard.
    • B&C notes in addition that Section 6(d)(1) of U-V DD states that in taking actions against a chemical that has been determined not to meet the safety standard, EPA shall "promulgate a rule establishing restrictions necessary to ensure that the chemical substance meets the safety standard," which reinforces that vulnerable populations will be protected.
• The next set of issues relates to deadlines that can ensure there is an enforceable schedule for issuing the initial priority list and that a mechanism is in place to ensure a sufficient number of chemicals are prioritized and assessed by EPA.
  • U-V DD includes a number of specific deadlines as well as other provisions that give EPA greater flexibility to initiate prioritization and assessments, and also requires that EPA repopulate the priority list as specific chemicals conclude that process.
• Ensure that EPA has the authority to order testing where adequate information is lacking.
  • U-V DD includes authority for testing needed to support prioritization, low priority designations must be based on sufficient information, and a chemical can be designated as a high priority on the basis of insufficient information.
• Ensure that procedural and scientific requirements for prioritization, assessment, and management of risks can be efficiently implemented and are balanced, attainable, and not overly prescriptive.
  • U-V DD has consolidated the many overlapping and redundant policies and requirements in CSIA1 into a new Section 3A. In addition, the "problematic" definition of "best available science" has been deleted and risk assessment approaches "favored by industry" have been struck or made neutral.
    • Regarding the latter, we note that U-V DD has deleted the reference to, for example, "identification of threshold doses," and as discussed in our initial Memorandum, we appreciated the efforts to consolidate relevant provisions and also the formation of a new Science Advisory Committee on Chemicals.
• Ensure aggressive but achievable deadlines are statutorily mandated.
  • U-V DD includes specific deadlines for establishing all policies, procedures, and guidance, completing Inventory reset and identification of active chemicals, initiation of prioritization, and for completion of safety assessments, determinations, and risk management actions.
    • While we appreciated the inclusion of deadlines in our initial Memorandum, we had questioned the "exceedingly aggressive implementation schedule."
• Ensure authority exists to prohibit import of articles containing banned or regulated chemicals.
  • U-V DD has restored coverage of imported articles and, where needed, requires certification of imported articles.
    • In regard to this item, we particularly appreciated the inclusion in U-V DD of a description of what constituted "reasonable inquiry" regarding imported chemicals, mixtures, and articles.
• Ensure that final agency actions (FAA) are explicitly designated and that they are subject to judicial review.
  • U-V DD explicitly identifies FAAs, which are then subject to judicial review.
• Ensure that EPA has adequate resources, "including a fair share from the regulated community."
  • The response acknowledges that this issue has not yet been addressed although it states its agreement that adequate resources be provided including from the regulated community which should share a "portion of those through user fees." The response goes on to indicate that several options have been discussed and indicates a willingness to address this portion of the bill at the appropriate time when a complete understanding of the resources that will be needed is available.

Document Concerning "10 Key Enhancements"

This document summarizes the key changes to CSIA1 in U-V DD. These include many of the items discussed immediately above but the document also includes additional points such as the following:

• U-V DD "eliminates red tape that could potentially undermine risk management decisions by EPA." The paper notes that U-V DD has clarified that cost-benefit analysis is required for only a limited number of alternatives to the regulatory action and that the analysis can be based on available information.
• U-V DD ensures that new chemicals can enter the market only where EPA has affirmed that they are likely to meet the safety standard.
• U-V DD maximizes public access to health and environmental information on chemicals while protecting legitimate confidential business information (CBI). The paper notes that under the new draft:
  • Health and safety information is generally not eligible for CBI protection (as was the case in the Toxic Substances Control Act (TSCA)).
  • Protection of chemical identity is presumed only before such chemicals are commercialized.
  • Claims for CBI protection of chemical identity, including historic claims, must be substantiated and are subject to EPA review according to a schedule or on an ad hoc basis under some circumstances.
  • CBI claims must generally be substantiated and are subject to EPA review and approval; such claims expire after ten years unless they are found by EPA to warrant renewal.

Document Entitled "Pragmatic Compromises to Revise the Chemical Safety Improvement Act Yields a Stronger Draft Bill with Growing Support"

This paper recognizes the efforts by Senators Tom Udall (D-NM) and Vitter to reform TSCA and strengthen the regulation of chemicals in commerce. "After over a year of negotiation" the Senators have "reached a reasonable, balanced compromise" although "some work remains to address the role of state regulation ... and ensure adequate resources." The paper goes on to state that the revised draft "has been significantly strengthened and shares significantly broader bipartisan support." Senators Udall and Vitter believe that "illustrating the significant progress on the draft will help stakeholders achieve a consensus on the remaining details of the legislation and finally update this 38-year-old law." The paper goes on to summarize the history of CSIA1 and discusses the "numerous modifications" made in the revised CSIA, and in so doing reiterates many of the points noted above. One new point concerning preservation of existing private rights of action is picked up and discussed in the paper, which notes that U-V DD has:

• Clarified that the existing right to sue and seek damages is not affected by the bill.
• Makes clear that nothing in the bill affects the ability of litigants to obtain CBI in a judicial proceeding.

Although the statement alludes to having attained "significantly broader bipartisan support" this aspect is not further discussed. We note that of the 11 Democratic Senators who sent the February 2014 letter to Senator Vitter, none of them had previously signed on as Cosponsors of CSIA1.

Commentary

These documents appear to have been prepared to indicate that this draft of the legislation represented significant movement from earlier bills, moving towards the position of the 11 Democratic Senators and other critics who raised various concerns about CSIA1. This is not to say that some or all of those Senators would be satisfied, or that new concerns would not arise (and any of those would be in addition to the two important issues left unsettled by U-V DD -- adequate funding and any limits to state authority). At the same time, with the review of all of these recently made public documents, this new draft represents an attempt to compromise towards the 11 Democrat signatories, and if all had been persuaded to cosponsor the legislation, it would represent a working majority beyond 60 members if one can further assume that all the Republican members would support Senator Vitter.

Speculating about bills not introduced at the end of a legislative session is typically a parlor exercise for those who track relatively narrow issue sets pondering "what ifs" during the time between sessions of Congress. In this case, it may represent a working nucleus of amendments and efforts by interested members that could form the basis of significant improvement in the likelihood of legislative compromise in 2015-2016. As the outcome of the 2014 elections is likely to result in a narrow majority for either party, successful efforts in any realm will need to have significant bipartisan support, especially to have any chance in the House of Representatives with an expected strong Republican majority. Party control of the Senate, Committee members, continued partisan sniping, and numerous other important factors will still need to align to give any TSCA reform efforts a high probability of success.

U-V DD, however, provides a new and improved template to serve as the basis for continued efforts to find a response if not a resolution to various complaints heard about CSIA1. Any new session of Congress starts with a clean slate, any agreement from past years is non-binding, but the current draft is significantly friendlier towards the various environmental group critiques of past efforts. As stated before, this does not mean that all interest groups will be satisfied, and if success seems near, often new demands are made by various players for any number of different reasons.

What is most promising is that if the U-V DD language is agreeable to the chemical industry supporters of TSCA reform, there are numerous concessions that have been previously absent. This is especially what makes the new proposal so tantalizing, as it represents a significant breakthrough from previous incantations of agreeing in principle with relatively little follow-through.

Stay tuned; we certainly will.