**CHAPTER ONE**

**BACKGROUND AND OVERVIEW OF ANALYSIS**

The Emergency Planning and Community Right-to-Know Act (EPCRA), also
known as Title III of the Superfund Amendments and Reauthorization Act
of 1986 (SARA), created a broad range of emergency response planning and
reporting requirements for manufacturers, processors, and users of toxic
chemicals in the United States. 42 U.S.C. §§ 11001-11050. Under section
313 of EPCRA, certain facilities are required to submit annual reports
to the United States Environmental Protection Agency (EPA) and to States
on their release, transfer, and waste management activity of certain
toxic chemicals if they are manufactured, processed, or otherwise used
above thresholds amounts. In addition, the Pollution Prevention Act
(PPA) of 1990 requires these same facilities to report pollution
prevention, recycling, and other waste management information for these
same chemicals. EPA maintains the data collected under EPCRA section 313
and the PPA in a database known as the Toxics Release Inventory
(TRI).[^1]

Since the inception of the TRI Program, EPA has implemented measures to
reduce the reporting burden on the regulated universe, and make TRI
reporting as user friendly as possible. These measures include
compliance assistance activities, such as industry-specific guidance and
annual training workshops. EPA also reduced the time spent completing
the required TRI forms by developing the Toxics Release Inventory--Made
Easy (TRI-ME) software and adding the Form A certification. In January
2005, EPA proposed the TRI Reporting Forms Modification Rule (79 FR
1674, January 10, 2005) that included general options for reducing the
time, cost, and complexity of the reporting requirements imposed on
facilities. (EPA refers to this rulemaking as the "Phase 1\" burden
reduction rulemaking.)

EPA is proposing additional options for streamlining TRI reporting. The
purpose of this proposed rule is to provide additional burden reduction
options without compromising the quality of toxic chemical release data
and of other waste management information. This additional set of burden
reduction options will be referred to hereafter as the "Phase 2\" burden
reduction rulemaking.

This report analyzes the economic effects of the Phase 2 burden
reduction options. To understand the effects of the proposed rule,
however, it is first necessary to understand how EPCRA section 313 and
TRI currently operate. This chapter provides an overview of TRI followed
by a description of the proposed rule and organization of the report.

**1.1 OVERVIEW OF TRI**

In 1986, Congress passed the Emergency Planning and Community
Right-to-Know Act (EPCRA). The law was passed in response to the
accidental release of methyl isocyanate gas in Bhopal, India, in
December 1984, and to a number of chemical accidents in the United
States, including one in Institute, West Virginia. These accidental
releases highlighted the lack of information readily available to the
public about toxic chemicals being manufactured, processed, used, and
transported within their communities. EPCRA is based on the premise that
the public has the right to know about the use of chemicals, as well as
their routine and accidental releases. The broad purposes are to
encourage planning for response to accidental chemical releases as well
as daily management of routine releases, and to provide the public and
government agencies with information about the presence, release, and
management of toxic chemicals.

EPCRA contains four main provisions:

-   Planning for chemical emergencies (sections 301-303),

-   Emergency notification of chemical accidents and releases (section
    304),

-   Reporting of hazardous chemical inventories (sections 311-312), and

-   Toxic chemical release reporting (section 313).

    Because this rule is being proposed under section 313 (and not the
    other sections of EPCRA), the remainder of this overview deals only
    with the TRI provisions of section 313.

    The first regulations implementing EPCRA section 313 were
    promulgated on February 16, 1988 (53 FR 4500), and are codified at
    40 CFR part 372. Under these original regulations, owners or
    operators of regulated facilities must complete the Toxic Chemical
    Release Inventory Reporting Form R, which includes information on
    releases to air, water, and land, as well as on-site waste treatment
    and transfers of the chemical to off-site locations.

    A facility must report under section 313 if it meets all of the
    following three criteria:

    \(1\) It is in a Standard Industrial Classification (SIC) code
    covered by the regulations;

    \(2\) It has ten or more full-time employees (or the hourly
    equivalent of 20,000 hours); and

    \(3\) It manufactures, processes, or otherwise uses any of the
    listed toxic chemicals or chemical categories above the applicable
    reporting threshold.

    Facilities must submit the forms each calendar year to both EPA and
    the State in which the facility is located by July 1 of the
    following year.

    A completed Form R must be submitted for each toxic chemical
    manufactured, processed, or otherwise used over threshold levels at
    each regulated facility as described in 40 CFR part 372. For most
    chemicals, threshold levels are set at 25,000 lbs for manufacturing
    and processing and 10,000 lbs for otherwise use. 40 C.F.R. § 372.25.
    Over 600 toxic chemicals and chemical compound categories are
    currently on the list of TRI chemicals.

    TRI is unique among environmental databases because of the
    multimedia data it collects, and because it was designed for public
    access. EPCRA requires that EPA "establish and maintain in a
    computer database a national toxic chemical inventory based on data
    submitted to the Administrator." 42 U.S.C. § 11023(j). EPA maintains
    the section 313 data in the national TRI database. TRI data are
    available to the public in a variety of formats, including disk,
    on-line, and CD-ROM. With its broad dissemination, TRI data is used
    extensively by the public. Facilities use the data obtained through
    TRI to better understand their operations, and make better use of
    pollution prevention opportunities. Public-interest groups use the
    data to educate themselves on the presence of toxic chemicals in the
    environment, and use that improved information to engage in a
    meaningful, productive dialogue with industry and with all levels of
    government. In general, TRI data have proven to be a powerful tool
    in environmental decision-making.

    **1.1.1 Pollution Prevention Act**

    In 1990, Congress passed the Pollution Prevention Act (PPA), which
    adopted as national policy an environmental hierarchy that
    establishes pollution prevention as the first choice among waste
    management options. 42 U.S.C. §§ 13101-13109. For waste that cannot
    be prevented at the source, recycling is considered the next best
    option. Treatment or disposal should be considered only after source
    reduction and recycling have been eliminated as options. Section
    6607 of the PPA supplemented the information reported under EPCRA
    section 313 by requiring facilities to also report information on
    their pollution prevention, recycling, and other waste management
    activities. The data elements required by the Pollution Prevention
    Act are included as section 8 of Form R.

    **1.1.2 Changes to the List of Chemicals**

    When Congress passed EPCRA it provided an initial list of
    approximately 300 chemicals and chemical categories subject to TRI
    reporting. The statutory list was derived from chemical lists used
    in New Jersey and Maryland. Congress also included a provision in
    EPCRA that EPA may amend the list of chemicals subject to TRI
    reporting. Under section 313(d), EPA has the authority to add a
    chemical to the list if it determines that the chemical can cause or
    can be reasonably anticipated to cause:

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-   Adverse acute human health effects at concentration levels
    reasonably likely to exist beyond facility site boundaries as a
    result of continuous or frequently recurring releases;

-   In humans, cancer or teratogenic effects, serious or irreversible
    reproductive dysfunctions, neurological disorders, heritable genetic
    mutations, or other chronic health effects; or

-   A significant adverse effect on the environment. See, 42 U.S.C.§
    11023(d).

    EPA has added chemicals to the list through its authority under
    section 313(d). Most notably, EPA added 286 chemicals and chemical
    categories to the list of toxic chemicals subject to TRI on November
    30, 1994 (59 FR 61432). The majority of these chemicals are
    pesticides. Many of the remainder are chemicals either regulated or
    identified as concerns under other environmental statutes such as
    the Clean Air Act, the Clean Water Act, and the Safe Drinking Water
    Act.

    EPA may delete a chemical from the list if it does not meet any of
    the above criteria found in 313(d). According to section 313(e) of
    EPCRA, any person may petition EPA to add or delete a chemical from
    the list on the basis of whether or not it meets the above criteria.
    See, 42 U.S.C. § 11023(e). All changes to the list are made through
    rulemaking under the Administrative Procedures Act (APA).

    **1.1.3 Alternate Threshold**

    On November 30, 1994, EPA finalized the "TRI Alternate Threshold for
    Facilities with Low Annual Reportable Amounts" (59 FR 61488). This
    rule was intended to reduce the compliance burden associated with
    EPCRA section 313. It established a streamlined reporting option for
    facilities where the annual reportable amount of a listed chemical
    released or managed does not exceed 500 pounds.[^2] Such facilities
    have the option of applying an alternate manufacture, process, or
    otherwise use threshold of 1 million pounds to that chemical,
    instead of the standard thresholds of 10,000 or 25,000 pounds. If a
    facility does not exceed the 1 million-pound threshold, then that
    facility is eligible to submit Form A for that chemical instead of
    Form R. Form A is a simplified reporting form that includes facility
    identification information and identifies the chemical or chemical
    category being reported. The form must be submitted on an annual
    basis.

    **1.1.4 Executive Order 12856**

    On August 3, 1993, Executive Order 12856, "Federal Compliance with
    Right-to-Know Laws and Pollution Prevention Requirements" was signed
    by the President (58 FR 41981). The Executive Order requires federal
    facilities to comply with EPCRA requirements beginning with the
    1994-reporting year. The Executive Order also asks all federal
    agencies to set a voluntary goal of 50% reduction from baseline
    quantities of their releases and transfers by 1999.

    1.1.5 Changes to the List of Industries

    On May 1, 1997, EPA added facilities in seven industry groups to the
    list of facilities subject to the reporting requirements of section
    313 (62 FR 23833). Prior to this action, reporting was limited to
    facilities in the manufacturing sector (SIC codes 20-39) and federal
    facilities. This action added facilities in the following sectors:

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-   Metal mining,

-   Coal mining,

-   Electric utilities,

-   Commercial hazardous waste treatment, storage, and disposal
    facilities

-   Chemicals and allied products-wholesale,

-   Petroleum bulk terminals and plants-wholesale, and

-   Solvent recovery services.

    The first reports from these facilities were submitted in 1999 for
    reporting year 1998.

    **1.1.6 Changes for Certain PBT Chemicals**

    On October 29, 1999, EPA lowered reporting thresholds to 10 or 100
    pounds for certain TRI chemicals (persistent, bioaccumulative and
    toxic chemicals, or PBT chemicals) that are of concern because of
    their tendency to persist and bioaccumulate (64 FR 58666). EPA also
    added to TRI certain PBT chemicals that were not already listed
    including a dioxin category with a reporting threshold of 0.1 grams.
    At this time EPA made other changes to PBT chemical reporting, such
    as disallowing the use of the *de minimis* exemption, range
    reporting, and Form A reporting for PBT chemicals. 40 CFR §
    372.28(b). On January 17, 2001, EPA lowered the reporting threshold
    for lead and lead compounds to 100 pounds and applied the same
    limitations as are applied to other PBT chemicals. 40 CFR § 372.28.

    **1.2 DESCRIPTION OF THE PROPOSED RULE**

    As described above, EPA has implemented a number of burden reduction
    measures. To build upon these efforts, EPA conducted a TRI
    Stakeholder Dialogue between Fall 2002 and early 2004. During this
    dialogue, improvements to the TRI reporting process were identified
    and a number of burden reduction options associated with TRI
    reporting were explored. After reviewing these improvements and
    reporting options, EPA has decided to proceed with burden reduction
    rulemakings in three phases: Phase 1) relatively simple,
    modifications to the reporting forms and Phase 2) new and expanded
    eligibility for Form A and Phase 3) alternate year reporting for all
    or some reporters.

    EPA is proposing two options that it believes may reduce reporting
    burden for TRI facilities. Some facilities may qualify for both
    options, however, for different chemicals. Although these options
    could be proposed separately, EPA is combining the options in the
    proposed rule. The following sections outline the specific options
    that are proposed.

    **1.2.1 New Eligibility for Form A: PBT Chemicals**

    This option allows facilities reporting on PBT chemicals (except
    dioxin and dioxin-like compounds) with no disposal or other releases
    (Section 8.1) and positive waste management quantities in Sections
    8.2 - 8.8, to use Form A. Facilities must also not manufacture,
    process, or otherwise use more than 1,000,000 pounds of the chemical
    and must have less than or equal to 500 pounds of total waste
    management quantities in Sections 8.2 through 8.8. Note that the 500
    pound annual reportable amount (ARA) is calculated differently for
    this option than the current approach for Form A. For this option,
    reporting facilities will sum sections 8.2 through 8.8 (8.8 is
    non-production related waste) to determine if their annual PBT
    reportable amount (PRA) is less than or equal to 500 pounds. To use
    the New Eligibility for Form A: PBT Chemicals Option, Section 8.8
    quantities cannot include release or disposal quantities. This
    approach differs from the current Form A reporting requirements in
    that EPA is proposing to have reporters also include Section 8.8
    quantities when calculating the PRA. Since this option is now
    available to PBT chemicals (except dioxin and dioxin-like
    compounds), which are of special concern, the Agency believes it is
    appropriate to include all release and other waste management
    quantities in the PRA, including non-production related quantities.
    If this calculation totals less than or equal to 500 pounds, the
    reporting facility may use Form A to report in lieu of Form R.

    2.  **Expanded Eligibility for Form A: Non-PBT Chemicals**

TRI reporters are currently able to take advantage of the alternate
reporting threshold if they have an ARA of 500 pounds or less. The ARA
is the total of all quantities released (on- and off-site, but excluding
catastrophic events), treated, recovered, recycled, and combusted at the
facility, plus all amounts transferred off-site from the facility for
the purpose of recycling, energy recovery, treatment, and/or disposal.
This option extends the existing Form A eligibility criteria and allows
a facility reporting on Non-PBT chemicals with an ARA of 5,000 lbs or
less to use Form A, provided they meet the 1,000,000 pound alternate
reporting threshold. EPA is also taking comment on two alternate annual
reportable amounts (1,000 lbs and 2,000 lbs) for this option.

**1.3 ORGANIZATION OF THIS REPORT**

This report examines the potential burden and cost savings to industry
that would result from the broad, comprehensive set of regulatory burden
reduction options described above. This report also estimates the other
impacts of the rule. The remainder of the report is organized as
follows:

**Chapter 2** presents the methodology used to estimate the unit burden,
unit costs, and impacts of the proposed Phase 2 rule.

**Chapter 3** presents the total burden and cost savings associated with
the proposed rule.

**Chapter 4** evaluates the benefits of the proposed rule.

**Chapter 5** presents the impacts of the proposed rule on reporting

[^1]: 1 ^1^ The term "EPCRA section 313\" properly refers to only the
    statutory requirements, while the term "TRI" properly refers to the
    database that stores the information collected both under EPCRA
    section 313 and under section 6607 of the PPA. However, the terms
    are have often been used interchangeably by the public to refer to
    the statute, the regulatory requirements, the reporting form, the
    database, and/or and EPA\'s program to manage the data. In deference
    to common usage, the terms EPCRA section 313 and TRI are sometimes
    used interchangeably in this report where doing so will make the
    report simpler and easier to read.

[^2]: 2 The annual reportable amount is equal to the combined total
    quantities recycled, combusted for energy recovery, treated, or
    released. It can be calculated as is the sum of data elements 8.1
    through 8.7 on Form R.