*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 

EO12866_Formaldehyde-TPCs_NPRM_EA_2012-03-20.docx

Draft document as submitted for review under EO 12866/13563.

Economic Analysis of the Third-Party Certification 

Framework for the Formaldehyde Standards for 

Composite Wood Products Proposed Rule

RIN 2070-AJ44

EO 12866 REVIEW DRAFT 

Economic and Policy Analysis Branch 

Economics, Exposure and Technology Division 

Office of Pollution Prevention and Toxics 

Office of Chemical Safety and Pollution Prevention 

U.S. Environmental Protection Agency 

March 2012 

 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 

Acknowledgment

EPA acknowledges the analytical and draft preparation support of Abt Associates Inc. of 

Cambridge, Massachusetts in the preparation of this report, provided under Contract No. EP-W08-10. 

Notice 

This is not an official guidance document and should not be relied upon to determine 

applicable regulatory requirements. This document was prepared to provide economic 

information for the rulemaking process, and to meet various administrative and 

legislative requirements. Due to the nature of the information available to EPA, the 

document contains various assumptions that may not reflect the regulatory 

determinations that an individual firm or organization would make were it to apply the 

rule's requirements to its specific circumstances. Persons seeking information on 

specific regulatory requirements should consult 40 CFR Part 767, and the preamble 

for the regulatory action. 

Mention of the names of specific companies, organizations, or entities does not 

constitute an endorsement by EPA. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule i

Table of Contents 

1 Summary of Economic Analysis .........................................................................................1

2 Certification System .............................................................................................................6

2.1 Certification System Framework ...........................................................................................6

2.2 Profile of Third Party Certifiers and Accreditation Bodies ..................................................10 

3 Costs of the TSCA Title VI TPC Rule ..............................................................................16

3.1 Proposed Rule Requirements ...............................................................................................16 

3.2 Wage Rates Used in the Analysis ........................................................................................17 

3.3 Costs to Accreditation Bodies ..............................................................................................18 

3.4 Third-Party Certifier Costs ...................................................................................................20 

3.5 Total Cost to TPCs ...............................................................................................................29 

3.6 Total Costs of the Rule for U.S. Accrediting Bodies and TPCs ..........................................30 

4 Impact Analyses ..................................................................................................................32

4.1 Paperwork Reduction Act Analysis .....................................................................................32 

4.2 Regulatory Flexibility Act Analysis .....................................................................................33

4.3 Unfunded Mandates Reform Act (UMRA) ..........................................................................37 

4.4 Executive Order 13132 - Federalism ...................................................................................38 

4.5 Executive Order 13175 - Tribal Implications ......................................................................38 

4.6 Executive Order 13045 - Protection of Children .................................................................38 

4.7 Executive Order 13211 - Energy Effects .............................................................................38 

4.8 National Technology Transfer and Advancement Act .........................................................39 

4.9 Executive Order 12898 – Environmental Justice .................................................................39 

Appendix A: Wage Rates 

Appendix B: Recordkeeping and Reporting Burdens
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March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 1

1 1 Summary of Economic Analysis 

2 

3 

4 This report presents an economic analysis of the U.S. Environmental Protection Agency 

5 (EPA)’s proposed Third Party Certification rule. The Formaldehyde Standards for Composite 

6 Wood Products Act, which created Title VI of the Toxic Substances Control Act (TSCA), 

7 established formaldehyde emission standards for composite wood products (hardwood plywood, 

8 medium-density fiberboard, and particleboard) sold, supplied, offered for sale or manufactured in 

9 the United States. Under TSCA Tile VI, manufacturers of composite wood products must 

10 comply with specific formaldehyde emission standards, and their compliance must be verified by 

11 a third party certifier (TPC). 

12 

13 Third-party certification involves a process by which a product, process or service is 

14 reviewed by a reputable and qualified independent third-party to verify that a set of norms, 

15 criteria, claims, practices or standards are being met. The standards used in a third-party 

16 certification process are typically voluntary consensus standards developed by nationally or 

17 internationally recognized standards-producing organizations or industry groups. TPCs are 

18 overseen by accreditation bodies (ABs), which provide an impartial verification of the 

19 competency of the TPCs. 

20 

21 The proposed TPC rule establishes a framework whereby ABs accredit TPCs so that the 

22 TPCs may certify composite wood product manufacturers under TSCA Title VI. The proposed 

23 rule identifies the roles and responsibilities ABs and TPCs, as well as the criteria for 

24 participating in the program. Under the proposed framework, participating ABs would accredit 

25 TPCs, audit TPCs, maintain records on their accredited TPCs, and report to EPA on TPCs’ 

26 activities. TPCs would be responsible for activities such as regularly auditing manufacturers, 

27 conducting and verifying formaldehyde emissions tests, and ensuring that manufacturer quality 

28 assurance and quality control procedures and testing comply with the requirements set forth in 

29 the TSCA Title VI rule. 

30 

31 Under the TSCA Title VI rule, participating accrediting bodies will need to familiarize 

32 themselves with the rule (in the first year), submit an application and enter into a recognition 

33 agreement with EPA (in the first year and every three years thereafter), and provide notifications 

34 and reports and keep records (every year). As shown in Table 1-1, accreditation bodies are 

35 expected to incur costs of $1,685 in the first year, $1,070 in years with reapplication and 

36 recognition agreement resubmissions, and $633 in other years. 

37 

Table 1-1: Costs per Accrediting Body

Type of Cost Cost (2010$) 

First Year Reapplication Years1 Non-Reapplication Years 

Rule Familiarization $615 $0 $0 

Application or Reapplication Process $88 $88 $0 

Prepare Recognition Agreement $349 $349 $0 

EPA Notification $57 $57 $57 

TPC Notification $12 $12 $12 

Recordkeeping $308 $308 $308 

Reporting $256 $256 $256 

Cost per Accrediting Body $1,685 $1,070 $633 
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March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 2

1

 Accreditation bodies are required to reapply to the program every three years. 

38 

39 Eight accreditation bodies in the U.S. are assumed to participate in the TSCA Title VI 

40 program. As shown in Table 1-2, total annual costs to U.S. accreditation bodies are estimated to 

41 be $13,480 in the first year, $8,560 in years when accrediting bodies must reapply to the 

42 program, and $5,064 in other years. Annualized costs are estimated at $6,204 to $6,222 per year, 

43 depending on the discount rate. 

44 

Table 1-2: Total Costs for U.S. Accrediting Bodies

Type of Cost Cost (2010$) 

First Year Reapplication Years1 Non-Reapplication Years 

Cost per Accrediting Body $1,685 $1,070 $633 

Number of U.S. Accrediting Bodies 8 8 8 

Total Costs for U.S. Accrediting Bodies $13,480 $8,560 $5,064 

Annualized Costs (30 years, 3 percent) $6,204 

Annualized Costs (30 years, 7 percent) $6,222 1

 Accreditation bodies are required to reapply to the program every three years. 

45 

46 TPCs participating in the TSCA Title VI program will need to conform to several 

47 voluntary standards and guides by the International Organization for Standardization (ISO) and 

48 International Electrotechnical Commission (IEC). Accreditations can cost TPCs up to $25,000 

49 obtain and $5,000 per year to maintain, but most TPCs will already have all the necessary 

50 accreditations. TPCs will also have to familiarize themselves with the rule and submit an 

51 application to the TSCA Title VI program (in the first year); reapply to the program (every two 

52 years); and submit notifications and reports and maintain records (every year). As shown in 

53 Table 1-3, TPCs that already have all accreditations in place will incur an estimated cost of 

54 $2,090 in the first year, $1,475 in reapplication years, and $983 in non-reapplication years. 

55 TPCs that need to obtain an additional accreditation will incur an estimated cost of $27,090 in 

56 the first year, $6,475 in reapplication years and $5,983 in non-reapplication years. 

57 

Table 1-3: Costs per TPC

Type of Cost 

Cost (2010$) 

First Year Reapplication Years2 Non-Reapplication 

Years 

 Have 

Accred. 

Need 

Accred. 

Have 

Accred. 

Need 

Accred. 

Have 

Accred. 

Need 

Accred. 

Accreditation1 $0 $25,000 $0 $5,000 $0 $5,000 

Rule Familiarization $615 $615 $0 $0 $0 $0 

Application or Reapplication Process $492 $492 $492 $492 $0 $0 

Manufacturer Notification and Recordkeeping $773 $773 $773 $773 $773 $773 

Annual Report and Notifications of Changes $210 $210 $210 $210 $210 $210 

Cost per TPC $2,090 $27,090 $1,475 $6,475 $983 $5,983 

1

 Two-thirds of TPCs are assumed to be accredited for all three standards required by the rule (ISO/IEC Guide 65, 17020, and 

17025) and thus incur no cost for accreditation or reaccreditation. One-third of TPCs will need to become accredited (and 

maintain accreditation) for one additional standard at a cost of $25,000 in the first year and $5,000 per year in subsequent years. 2

 TPCs are required to reapply every two years. CARB TPCs are grandfathered in for the first year. 

58 

59 Nine TPCs in the U.S. are assumed to participate in the TSCA Title VI program. Six of 

60 them are assumed to already have all the necessary accreditations, while three are assumed to 

61 need to obtain and maintain an additional accreditation. As shown in Table 1-4, total annual 

62 costs to U.S. TPCs are estimated to be $93,810 in the first year, $28,275 per year in reapplication 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 3

63 years, and $23,847 per year in the remaining years. Total annualized costs are estimated at 

64 $27,917 to $28,760 per year, depending on the discount rate. 

65 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 4

66 

67 

Table 1-4: Total Costs for U.S. TPCs

Type of Cost 

Cost (2010$) 

First Year Reapplication Years2 Non-Reapplication 

Years 

 Have 

Accred. 

Need 

Accred. 

Have 

Accred. 

Need 

Accred. 

Have 

Accred. 

Need 

Accred. 

Cost per TPC $2,090 $27,090 $1,475 $6,475 $983 $5,983 

Number of U.S. TPCs 6 3 6 3 6 3 

Total Cost by Accreditation Status $12,540 $81,270 $8,850 $19,425 $5,898 $17,949 

Total Costs for U.S. TPCs $93,810 $28,275 $23,847 

Total Annualized Costs (30 years, 3%) $27,917 

Total Annualized Costs (30 years, 7%) $28,760 

1

 Two-thirds of TPCs are assumed to be accredited for all three standards required by the rule (ISO/IEC Guide 65, 17020, and 

17025) and thus incur no cost for accreditation or reaccreditation. One-third of TPCs will need to become accredited (and maintain 

accreditation) for one additional standard. 

2

 TPCs are required to reapply every two years. CARB TPCs are grandfathered in for the first year. 

68 

69 Table 1-5 summarizes the estimated costs attributable to the proposed rule. The 

70 estimated total cost is $107,290 in the first year. Total subsequent year costs range from $28,911 

71 to $36,835 depending on whether it is a reapplication year for ABs and TPCs. Annualized costs, 

72 calculated over a 30-year period at three and seven percent discount rates, are $34,121 to 

73 $34,983. 

74 

Table 1-5: Summary of Costs to U.S. Accreditation Bodies and TPCs (2010$) 

Type of Cost U.S. ABs 

U.S. TPCs All Affected 

U.S. Firms Have Necessary 

Accreditation 

Need Additional 

Accreditation 

Per Firm Costs: Year 1 $1,685 $2,090 $27,090 - 

Per Firm Costs: Subsequent Years $633 to $1,070 $983 to $1,475 $5,983 to $6,475 - 

Number of Affected Firms 8 6 3 17 

Total Year 1 Costs $13,480 $12,540 $81,270 $107,290 

Total Costs: Subsequent Years $5,064 to $8,560 $5,898 to $8,850 $17,949 to 

$19,425 

$28,911 to 

$36,835 

Total Annualized Costs (30-Years, 3 percent 

discount rate) $6,204 $7,212 $20,706 $34,121 

Total Annualized Costs (30-Years, 7 percent 

discount rate) $6,222 $7,130 $21,630 $34,983 

75 

76 The rule will affect an estimated nine small entities in the U.S. – four accreditation bodies 

77 and five TPCs. Some of the small entities are expected to be businesses, and others to be non78 profit organizations. The rule’s impacts on small entities are analyzed by determining the ratio 

79 of costs to revenues for small businesses, and the ratio of costs to expenses for small non-profit 

80 organizations. The cost impacts are then categorized as being under one percent, between one 

81 and three percent, and over three percent. 

82 

83 As shown in Table 1-6, there five small non-profits predicted to be affected by the rule, 

84 all of which are estimated to have cost impacts of less than one percent of expenses. Four small 

85 businesses are predicted to be affected by the rule; two of them are estimated to have cost 

86 impacts of less than one percent of revenues, and two are estimated to have cost impacts between 

87 one percent and three percent of revenues. No small entities are predicted to have cost impacts 

88 over three percent. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 5

89 

Table 1-6: Summary of Small Entity Impacts 

Entity Type Number of U.S. Entities 

that are Small 

Estimated Number of Small Entities with Impacts 

Under One 

Percent 

Between One and 

Three Percent 

Over Three Percent 

TPCs Non-profit 2 2 0 0 

Business 3 1 2 0 

ABs Non-profit 3 3 0 0 

Business 1 1 0 0 

Combined 

Non-profit 5 5 0 0 

Business 4 2 2 0 

Total 9 7 2 0 

90 

91 
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March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 6

92 2 Certification System 

93 

94 2.1 Certification System Framework 

95 

96 The certification system under the proposed TSCA Title VI TPC rule is based on a 

97 framework of international standards organizations and existing voluntary consensus standards, 

98 accreditation and inspection oversight organizations, accrediting bodies, and third party 

99 certifiers, as described below. See Figure 1 for a diagrammatic approach to the relationships 

100 between the organizations in the certification system framework. 

101 

102 The certification system under the TSCA Title VI TPC rule will be similar, although not 

103 identical, to that under the California Air Resources Board’s (CARB) Air Toxics Control 

104 Measure (ATCM) to reduce formaldehyde emissions from composite wood products. Under the 

105 CARB ATCM, manufacturers of composite wood products must have their compliance with the 

106 emission standards verified by a TPC approved by CARB. The CARB ATCM requires TPCs to: 

107 verify that composite wood product manufacturers are complying with the quality assurance 

108 requirements; verify formaldehyde emission test results; work with manufacturers to establish 

109 quality control limits for each product type and production line; provide independent inspections 

110 and audits of manufacturers and records; use laboratories that are certified by an accreditation 

111 body that is a signatory to the International Laboratory Accreditation Cooperation Mutual 

112 Recognition Arrangement; and provide an annual report to CARB. In order to implement the 

113 ATCM, CARB directly evaluates and approves TPCs seeking to participate in the program. 

114 

115 2.1.1 International Standards Organizations 

116 

117 The International Organization for Standardization, known as ISO, is a non-governmental 

118 international standard-setting body comprising representatives from various national standards 

119 organizations. The organization promulgates worldwide proprietary industrial and commercial 

120 standards. The International Electrotechnical Commission (IEC) is a non-profit, non121 governmental international standards organization that prepares and publishes International 

122 Standards for electrical, electronic and related technologies. The IEC cooperates with the ISO 

123 when appropriate. The use of the ISO/IEC prefix covers publications from ISO/IEC Joint 

124 Technical Committee on Information Technology, as well as conformity assessment standards 

125 developed by ISO’s committee on conformity assessment (CASCO). 

126 

127 The ISO/IEC standards relevant to the TSCA Title VI TPC rule include ISO/IEC Guide 

128 65, which specifies requirements for bodies operating product certification systems; ISO/IEC 

129 17011, which specifies general requirements for accreditation bodies accrediting conformity 

130 assessment bodies; ISO/IEC 17020, which specifies requirements for competence of calibration 

131 and testing laboratories; and ISO/IEC 17025, which specifies the general requirements for 

132 laboratories to demonstrate they are competent to conduct testing and/or calibrations, including 

133 sampling. 

134 

135 2.1.2 Accreditation and Inspection Oversight Organizations 

136 
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March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 7

137 Accreditation and inspection oversight organizations ensure that their accreditation body 

138 members only accredit laboratories that are competent to do the work they undertake and are not 

139 subject to conflicts of interest. They also establish mutual recognition arrangements among 

140 accreditation bodies to ensure that the results from accredited laboratories will be accepted 

141 anywhere in the world. Examples of accreditation and inspection oversight organizations 

142 include the International Accreditation Forum, Inc. (IAF), and the International Laboratory 

143 Accreditation Cooperation (ILAC). 
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March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 8

144 Figure 1. TSCA Tile VI Proposed Third-Party Certification Framework

145 

146 International Standards 

147 Organizations 

148 Develop consensus-based international 

149 standards for quality management 

150 and conformity assessment 

151 

152 

153 Accreditation and Inspection 

154 Oversight Organizations 

155 Ensure competency of Accrediting 

156 Bodies and their conformance with 

157 international standards: 

158  Ensures AB conformance to 

ISO/IEC 170111 159 

160  Ensure ABs are qualified to oversee 

161 TPC conformance to ISO/IEC Guide 65 

162 ISO/IEC17020 and/or ISO/IEC 17025 

163 

164 

165 Accrediting Bodies 

166 Ensure competency of TPCs; verify 

167 accuracy of emission test procedures; 

168 monitor quality assurance programs, audit 

169 and inspect TPCs and panel producers: 

170  Management systems conform to 

171 ISO/IEC 17011 

172  Ensure TPC conformance to 

173 applicable ISO/IEC Guides & Standards 

174 

175 

176 Third Party Certifiers 

177 Ensure that panel producers are in 

178 compliance with statutory 

179 formaldehyde emission standards: 

180  Management systems conform to 

181 ISO/IEC Guide 65 

182  Conform to applicable ISO/IEC 

183 Guides & Standards for 

184 Product & Laboratory Certification 

185 and Inspections 

186 

187 Composite Wood 

188 Product Panel Producer 

189 1 190 ISO/IEC 17011 – General Requirements for Accreditation Bodies Accrediting Conformity Assessment Bodies 2 191 MLA – IAF’s Multilateral Recognition Arrangement requires AB signatories to demonstrate they are capable of accrediting product certification 

192 bodies in conformance with ISO/IEC Guide 65 – General Requirements for Bodies Operating Product Certification Systems and ISO/IEC 17020 – 

193 General Criteria for the Operation of Various Types of Bodies Performing Inspection. 3 194 MRA – ILAC’s Mutual Recognition Arrangement requires AB signatories to demonstrate they are capable of accrediting testing laboratories in 

195 conformance with ISO/IEC 17025 – General Requirements for the Competence of Testing and Calibration Laboratories. 

196 

International Organization for 

Standardization (ISO) 

International Electrotechnical 

Commission (IEC) 

International Accreditation 

Forum, Inc (IAF) 

or equivalent organization 

 Ensures AB conformance to 

ISO/IEC 170111

 Require member ABs to be a 

signatory to MLA2

International Laboratory 

Accreditation Cooperation (ILAC) 

or equivalent organization 

 Ensures AB conformance to 

ISO/IEC 170111

 Require member ABs to be a 

signatory to MRA3

AB Type #3 

Product & Lab 

Accrediting Body 

 Recognition Agreement 

with EPA 

 Signatory to IAF MLA and 

ILAC MRA or equivalents 

 Ensure TPC conformance to 

ISO/IEC Guide 65, ISO/IEC 

17020 & ISO/IEC 17025

AB Type #2 

Laboratory 

Accrediting Body 

 Recognition Agreement 

with EPA 

 Signatory to ILAC MRA 

or equivalent 

 Ensure TPC conformance 

to ISO/IEC 17025 

AB Type #1 

Product 

Accrediting Body 

 Recognition Agreement 

with EPA 

 Signatory to IAF MLA or 

equivalent 

 Ensure TPC conformance 

to ISO/IEC Guide 65 & 

ISO/IEC 17020

TPC #2 

Accredited by AB #3 (acting as 

both Product AB & Lab AB) 

TPC #1 

Accredited by AB #1 (Product AB) 

& AB #2 (Lab AB) 

Panel Producer #4 

Certified by TPC #2 

Panel Producer #3 

Certified by TPC #2 

Panel Producer #2 

Certified by TPC #1 

Panel Producer #1 

Certified by TPC #1 
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March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 9

197 

198 2.1.3 Accreditation Bodies 

199 

200 An accreditation body (AB) is an organization that provides an impartial verification of 

201 the competency of a laboratory or TPC. In the context of formaldehyde and composite wood 

202 products, ABs ensure that TPCs can verify the accuracy of the emission test procedures used by 

203 composite wood product manufacturers to conduct formaldehyde emissions tests; monitor 

204 manufacturer quality assurance programs; and provide independent audits and inspections of 

205 manufacturers’ mills and testing facilities. There are ABs located throughout the world. ABs in 

206 the U.S. that are IAF or ILAC signatories include the AIHA Laboratory Accreditation Program 

207 (AIHA-LAP), the American Association for Laboratory Accreditation (A2LA), the American 

208 National Standards Institute (ANSI), Forensic Quality Services (FQS), the International 

209 Accreditation Service (IAS), the Laboratory Accreditation Bureau (L-A-B), the National 

210 Voluntary Laboratory Accreditation Program (NVLAP), and Perry Johnson Laboratory 

211 Accreditation, Inc. (PJLA). 

212 

213 The proposed TSCA Title VI TPC rule requires ABs to be either a signatory to IAF’s 

214 Multilateral Recognition Arrangement (MLA) or the equivalent for inspection and lab 

215 competency; ILAC’s Mutual Recognition Arrangement (MRA) or the equivalent for product 

216 certification competency; or both. An AB that is an IAF signatory is responsible for ensuring 

217 that the TPC is in conformity with ISO/IEC Guide 65 and ISO/IEC 17020. An AB that is an 

218 ILAC signatory is responsible for ensuring that a TPC is in conformity with ISO/IEC 17025. 

219 

220 Thus, TPCs will need to be accredited by two ABs unless their AB is a signatory to both 

221 ILAC and IAF (or equivalent oversight bodies). In the TSCA Title VI program, a Product AB is 

222 an organization that is a signatory to the IAF MLA or the equivalent, and that can verify the 

223 accuracy of the test procedures and facilities used by manufacturers to conduct tests, monitor 

224 manufacturer quality assurance and quality control programs, and provide audits and inspections. 

225 A Laboratory AB is an organization that is a signatory to the ILAC MRA, or the equivalent, and 

226 that is qualified to verify that testing and calibration laboratories can operate a quality 

227 management system, are technically competent, and are able to generate technically valid 

228 emissions results. 

229 

230 2.1.4 Third Party Certifiers 

231 

232 The third-party certifiers (TPCs) are responsible for activities such as regularly auditing 

233 manufacturers, conducting and verifying formaldehyde emissions tests, and ensuring that 

234 manufacturer quality assurance and quality control procedures and testing complies with TSCA 

235 Title VI TPC rule. Specific requirements include verifying that composite wood product 

236 manufacturers have adequate quality assurance controls and are complying with quality 

237 assurance and quality control requirements; verifying quality control test results compared with 

238 ASTM E-1333-96 test results by having laboratories conduct quarterly tests and evaluate test 

239 method equivalence; reviewing applications from manufacturers for reduced testing; working 

240 with manufacturers to establish quality control limits, and, if applicable, other limits for each 

241 product type and production line; informing manufacturers of criteria that will be used to 

242 determine if product lots are consistently exceeding the applicable quality control limit; 

243 inspecting and auditing manufacturers and their records at least quarterly; using a testing 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 10

244 laboratory or laboratories that comply with ISO/IEC 17025; certifying composite wood product 

245 types that comply with requirements under TSCA Title VI; following ISO/IEC Guide 65; 

246 following ISO/IEC 17020 in the carrying out of their inspections of the manufacturers; providing 

247 an approved TPC number (supplied by the accrediting AB) to the manufacturer for labeling and 

248 recordkeeping; and using laboratories that participate in an annual inter-laboratory comparison or 

249 proficiency testing program. 

250 

251 In the example shown in Figure 1, TPC #1 is accredited by two ABs: AB #1 (which is a 

252 signatory to the IAF MLA and acts as the Product AB) and AB #2 (which is a signatory to the 

253 ILAC MRA and acts a Laboratory AB). TPC #2 is accredited by a single AB, AB #3, which is a 

254 signatory to both the IAF MLA and the ILAC MRA and acts as both a Product AB and a 

255 Laboratory AB. 

256 

257 

258 2.2 Profile of Third Party Certifiers and Accreditation Bodies 

259 

260 2.2.1 Third Party Certifiers 

261 

262 CARB has approved nine TPCs located in the U.S. (although most of these U.S. TPCs 

263 provide services internationally). Two of these TPCs are non-profit organizations, and the rest 

264 are businesses. Table 2-1 lists the domestic TPCs approved by CARB, their NAICS code, the 

265 type of organization, the sales volume or expenditures and the number of employees for the TPC 

266 or its parent organization, the U.S. Small Business Administration’s size threshold for the 

267 NAICS code, and the TPC’s small entity status. 

268 

269 This analysis assumes that 9 U.S. entities will act as TPCs under the TSCA Title VI 

270 program, and uses existing CARB TPCs as a proxy for their size and characteristics, but that 

271 does not mean that all of the CARB TPCs will become TPCs under Title VI. In reality, some of 

272 the CARB TPCs may choose not to participate in the federal program, and/or new entities may 

273 apply that are not part of the CARB program. 

274 

275 Size information was available for four of the nine U.S. TPCs, including the two non276 profits. The size of the TPCs ranges from a non-profit with 10 employees and $1.6 million in 

277 expenditures to a business with 2,500 employees in 125 offices with parent company that 

278 manages $3.1 billion in assets. 

279 

280 Under the Regulatory Flexibility Act (RFA), unless an agency establishes an alternate 

281 definition, the term “small organization” means any not-for-profit enterprise which is 

282 independently owned and operated and is not dominant in its field. The RFA does not provide 

283 any guidance on how to judge whether an organization is dominant in its field. Non-profit TPCs 

284 and accreditation bodies perform the same activities (such as conducting and verifying 

285 formaldehyde emissions tests, accrediting, and auditing) as their for-profit counterparts. In order 

286 to interpret the RFA criteria for small organizations and treat all affected entities consistently, 

287 this analysis determines the size status of non-profits by applying the SBA size thresholds for the 

288 NAICS codes the non-profits are classified in. 

289 
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March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 11

290 Based on the data in Table 2-1, the two U.S. TPCs that are non-profits are classified as 

291 small entities, and two of the businesses are classified as large. The size status for five CARB 

292 TPCs could not be determined using the data in Table 2-1, so the small entity analysis in Section 

293 4.2 estimates a generic distribution of sizes based on Census data for the relevant NAICS codes. 

294 

295 TPCs come from a diverse set of industries – the six U.S.-based CARB TPCs for which 

296 Dun & Bradstreet listed an industry classification fall into five different NAICS codes. Thus, the 

297 firms that are likely to seek TPC accreditation may be very different from each other in terms of 

298 size, organization, and financial condition. Table 2-2 presents key industry summary statistics 

299 for these NAICS codes. However, the domestic TPCs approved by CARB represent a very small 

300 share of the 142,000 firms in these industries. And comparing Table 2-1 and Table 2-2, the 

301 CARB TPCs appear to be larger than the average firms in these industries. Thus, these Census 

302 statistics may not be representative of current CARB TPCs or potential new TSCA Title VI 

303 TPCs. 

304 

Table 2-1: CARB-Approved Third Party Certifiers Based in the U.S. 

Company Name NAICS 

code 

Organization 

Type 

Annual Sales 

Volume or 

Expenditures 1

(millions $) 

Total Employees 

SBA Size 

Threshold: 

Revenues ($ 

Millions) or 

Employees

Small Entity 

Status 

Certification Services 

International, LLC Unknown Unknown Unknown Unknown Unknown Unknown 

Composite Panel 

Association North 

America, Inc. (CPA) 

813910 Non-Profit $3.0 14 $7.0 Small 

Forestwood 

Industries, Inc. Unknown Unknown Unknown Unknown Unknown Unknown 

Hardwood Plywood 

and Veneer 

Association (HPVA) 

813910 Non-Profit $1.6 10 $7.0 Small 

NTA Incorporated 541330 Private 

Company $5.4 80 $4.5 Large 

PFS Corporation 

541611 Private 

Company Unknown 

According to 

company website, 

more than 100 

employees 

$7.0 Unknown 

Professional Service 

Industries, Inc. (PSI), 

owned by Olympus 

Partners Unknown Private 

Company 

Unknown, but 

Olympus Partners 

website reports 

they manage $3.1 

billion in assets. 

Unknown, but PSI 

website reports 

they have more 

than 2,500 

employees in 125 

offices 

Unknown 

Assumed to 

be large 

because of 

reported 

assets. 

Scientific 

Certification 

Systems (SCS) 

541380 Private 

Company Unknown SCS web site lists 

87 employees $12.0 Unknown 

TIMBERCO (dba 

TECO) 561990 Private Company Unknown 31 $7.0 Unknown 

1

 Annual sales volume is reported for businesses, and annual expenditures are reported for non-profits 

Sources: California Air Resources Board 2011 (list of TPCs), Dun & Bradstreet 2011 (sales volume and employees for businesses 

and NAICS codes for all entities), Internal Revenue Service 2010 (expenditures and employees for non-profits), U.S. Small Business 

Administration 2010 (size standards), and company web sites for PSI, PFS, and SCS for data on their sales volume and employees. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 12

305 

306 

Table 2-2: Industry Summary Statistics for NAICS Identified for U.S. Third Party Certifiers 

NAICS Firms 

Establishments Revenues 

($1000) 

Number of 

Employees 

Average 

Revenues 

per Firm 

($1000) 

Average 

Employees 

per Firm 

541330 - Engineering services 47,714 58,391 $187,531,866 977,031 $3,930 20 

541380 - Testing laboratories 5,288 6,549 $12,386,831 106,618 $2,342 20 

541611 - Administrative management 

consulting services 59,612 61,583 $67,994,053 351,829 $1,141 6 

561990 - All other support services 12,888 14,539 $20,897,346 195,544 $1,621 15 

813910 - Business associations 16,418 17,028 $22,482,137 116,055 $1,369 7 

Total 141,920 158,090 311,292,233 1,747,077 $2,193 12 

Note that TPCs could potentially be classified in additional NAICS as well; as a result, this list may not be comprehensive. 

Sources: U.S. Census Bureau 2010a; U.S. Census Bureau 2010b; U.S. Census Bureau 2010c; U.S. Census Bureau 2010d 

307 

308 Because Executive Order 12866, the Regulatory Flexibility Act, and the Unfunded 

309 Mandates Reform Act are all focused on entities located in the U.S., this analysis estimates costs 

310 and small entity impacts based on the expected number of domestic entities. But because the 

311 approval requirements for information collection requests under the Paperwork Reduction Act is 

312 not limited to U.S. entities, the reporting and recordkeeping burden of the rule is calculated for 

313 both foreign and domestic entities. Therefore, the analysis estimates the number of TPCs and 

314 ABs in other countries that are expected to participate in the Title VI program. 

315 

316 As shown in Table 2-3, there are a total of 27 CARB approved TPCs outside of the U.S., 

317 bringing the total number of CARB approved TPCs to 36. For the purpose of calculating 

318 reporting and recordkeeping burden under the Paperwork Reduction Act in Section 4.1, this 

319 analysis assumes that there will be 9 domestic and 27 foreign TPCs under the Title VI program, 

320 the same number as under the CARB program. 

321 

Table 2-3: CARB-Approved Third Party Certifiers by Country 

Country Where TPC is Located Number of TPCs 

Australia 1 

Austria 1 

Belgium 1 

China 5 

Czech Republic 1 

Denmark 1 

France 1 

Germany 4 

Hong Kong 3 

Indonesia 1 

Italy 3 

New Zealand 1 

Poland 1 

Spain 1 

Sweden 1 

Taiwan 1 

 Sub-total for TPCs outside the U.S. 27 

United States 9 

 Total 36 

Source: California Air Resources Board 2011 

322 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 13

323 2.2.2 Accreditation Bodies 

324 

325 There are eight ABs in the U.S. that are currently IAF or ILAC signatories. Table 2-4 

326 lists these domestic ABS, their NAICS code, the type of organization, the sales volume or 

327 expenditures and the number of employees for the AB or its parent organization, the U.S. Small 

328 Business Administration’s size threshold for the NAICS code, and the AB’s small entity status. 

329 It is not known which of these organizations accredit CARB TPCs for one or more of the 

330 relevant ISO/IEC standards (Guide 65, 17020, or 17025). 

331 

332 This analysis assumes that 8 U.S. ABs will participate in the TSCA Title VI program, and 

333 uses the characteristics of the ABs in Table 2-4 as proxies to estimate the impacts of the rule. 

334 This assumption may overestimate the number of affected entities, because some ABs that are 

IAF or ILAC signatories may not choose to participate in the TSCA Title VI program.1 335 And it is 

336 unlikely that additional bodies will become signatories as a result of the TSCA Title VI TPC 

337 rule, because becoming a signatory to IAF, ILAC, or an equivalent organization is a time338 intensive process that may take up to a year to complete (Personal Communication with IAS 

339 2011). 

340 

341 Five of the domestic ABs that are IAF or ILAC signatories are non-profit organizations, 

342 so this analysis assumes that five similarly sized non-profit ABs will participate in the TSCA 

343 Title VI program. Under the Regulatory Flexibility Act (RFA), unless an agency establishes an 

344 alternate definition, the term “small organization” means any not-for-profit enterprise which is 

345 independently owned and operated and is not dominant in its field. The RFA does not provide 

346 any guidance on how to judge whether an organization is dominant in its field. Non-profit TPCs 

347 and accreditation bodies perform the same activities (such as conducting and verifying 

348 formaldehyde emissions tests, accrediting, and auditing) as their for-profit counterparts. In order 

349 to interpret the RFA criteria for small organizations and treat all affected entities consistently, 

350 this analysis determines the size status of non-profits by applying the SBA size thresholds for the 

351 NAICS codes the non-profits are classified in. This results in an estimate that three small non352 profits and one small business will participate in the TSCA Title VI program as ABs. 

353 

 1

 For example, Forensic Quality Services does not appear to accredit any labs providing product or environmental testing, 

and states that its mission is “to provide training, education, quality assurance management and accreditation for 

providers of forensic science testing services to federal, state and local law enforcement agencies” (IRS 2010). So FQS 

seems unlikely to serve as an accrediting body for TPCs testing formaldehyde from composite wood products. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 14

Table 2-4: U.S. Accreditation Bodies that are IAF or ILAC Signatories 

Company Name NAICS 

code 

Organization Type

Sales Volume / 

Expenditures 

($ Millions)1

Total 

Employees 

SBA Size 

Threshold: 

Revenues 

($ Millions) or 

Employees 

Small 

Entity 

Status 

AIHA Laboratory Accreditation 

Programs, LLC 2 561990 Non-Profit $14.9 63 $7.0 Large 

American Association For 

Laboratory Accreditation 813920 Non-Profit $10.6 48 $14.0 Small 

American National Standards 

Institute (ANSI) 813910 Non-Profit $31.3 122 $7.0 Large 

Forensic Quality Services, Inc. 541990 Non-Profit $0.6 4 $7.0 Small 

International Accreditation 

Service (IAS) 813319 Non-Profit $2.5 54 $7.0 Small 

Laboratory Accreditation 

Bureau 541712 Private Company $0.4 6 500 employees Small 

National Voluntary Laboratory 

Accreditation Program 

(NVLAP), operated by the 

National Institute of Standards 

and Technology (NIST) 

- Federal 

Government - - - Large 

Perry Johnson Laboratory 

Accreditation Inc.3 541618 Private 

Company $17.0 147 $7.0 Large 

Notes: 1. Sales volume data are presented for businesses. Expenditure data are presented for non-profits. 

2. Size data for AIHA Laboratory Accreditation Programs, LLC is based on the size of the parent organization, the American 

Industrial Hygiene Association (AIHA). 

3. Sales volume and employee size data for Perry Johnson Laboratory Accreditation Inc. include D&B sales and employee data 

for "Perry Johnson Laboratory Accreditation" and the American Business Directory sales data for the related companies "Perry 

Johnson Inc" and "Perry Johnson Registrars".

Sources: American Business Directory 2011 (sales and employee data for Perry Johnson Inc. and Perry Johnson Registrars), 

Dun & Bradstreet 2011 (business sales volumes and employee data and NAICS codes for all entities), Internal Revenue Service 

2010 (non-profit expenditures and employees), U.S. Small Business Administration 2010 (size standards), and company web 

sites for AIHA and Perry Johnson for relationships among entities in their family tree.. 

354 

355 Table 2-5 lists the foreign countries with CARB-approved TPCs, the ILAC or IAF 

356 signatory ABs in that country, and their status as signatories for ISO/IEC Guide 65, 17020, and 

357 17025. It is not known which ABs these CARB-approved TPCs use. However, every country 

358 with a CARB approved TPC also has an AB that is an IAF or ILAC signatory, and most of the 

359 ABs are signatories to all three relevant ISO/IEC standards. The exceptions are Australia, New 

360 Zealand, and Hong Kong, each of which lacks an AB that is a signatory for ISO/IEC Guide 65. 

361 However, there is a joint AB for Australia and New Zealand that is a signatory for ISO/IEC 

362 Guide 65, and there is an AB in China that is a signatory for ISO/IEC Guide 65. Therefore, each 

363 foreign TPC could use a local AB for the TSCA Title VI program. 

364 

365 There are a total of 17 ABs shown in Table 2-5 that are IAF or ILAC signatories and are 

366 located in foreign countries with CARB-approved TPCs. While EPA does not know whether 

367 these ABs accredit CARB TPCs or whether some CARB TPCs use ABs located outside their 

368 own country, for the purpose of calculating reporting and recordkeeping burdens under the 

369 Paperwork Reduction Act, the analysis in Section 4.1 assumes that there will be 17 foreign ABs 

370 that participate in the TSCA Title VI program. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 15

371 

Table 2-5: Summary of IAF or ILAC Signatory Accreditation Bodies in Foreign Countries with 

CARB TPCs 

Country 

Number of 

CARB-approved 

TPCs in 

Country Accreditation Body 

ISO/IEC 

Guide 65 

ISO/IEC 

17020 

ISO/IEC 

17025 

1. Australia 1 

National Association of Testing 

Authorities, Australia (NATA) X X 

2. Australia and 

New Zealand 

Joint Accreditation System of Australia 

and New Zealand (JAS-ANZ) X 

3. Austria 1 

Bundesministerium fur Wirtschaft, 

Familie und Jugend (BMWA) X X X 

4. Belgium 1 

Belgian Accreditation Structure 

(BELAC) X X X 

5. China 5 

China National Accreditation Service for

Conformity Assessment (CNAS) X X X 

6. Czech 

Republic 1 Czech Accreditation Institute (CAI) X X X 

7. Denmark 1 Danish Accreditation (DANAK) X X X 

8. France 1 

Comite Francais d’Accreditation 

(COFRAC) X X X 

9. Germany 4 

Deutsche Akkreditierungsstelle GmbH 

(DakkS) X X X 

10. Hong Kong 3 

Hong Kong Accreditation Service 

(HKAS) X X 

11. Indonesia 1 

National Accreditation Body of Indonesia

(KAN) X X X 

12. Italy 3 

Sistema Italiano di Accreditamento 

(ACCREDIA) X X X 

13. New Zealand 1 

International Accreditation New Zealand 

(IANZ) X X 

14. Poland 1 Polish Centre for Accreditation (PCA) X X X 

15. Spain 1 

Entidad Nacional de Acreditacion 

(ENAC) X X X 

16. Sweden 1 

Swedish Board for Accreditation and 

Conformity Assessment (SWEDAC) X X X 

17. Taiwan 1 Taiwan Accreditation Foundation (TAF) X X X 

Result: there are a total of 17 ABs that are IAF or ILAC signatories in foreign countries with CARB-approved TPCs 

Sources: IAF; ILAC; CARB 

372 

373 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 16

374 3 Costs of the TSCA Title VI TPC Rule 

375 

376 This section describes the proposed regulatory requirements for accreditation bodies and 

377 TPCs and presents the estimated costs for obtaining and maintaining accreditation. 

378 

379 3.1 Proposed Rule Requirements 

380 

381 EPA is proposing to administer the TPC program by developing recognition agreements 

382 with accreditation bodies. The ABs would then process TPC applications and oversee the TPCs. 

383 

384 3.1.1 Requirements for Accreditation Bodies 

385 

386 As described in Section 2.1, the proposed rule would require ABs to be either a signatory 

387 to the International Laboratory Accreditation Cooperation (ILAC) Mutual Recognition 

388 Arrangement (MRA) or the equivalent for inspection and lab competency, the International 

389 Accreditation Forum, Inc. (IAF) Multilateral Recognition Arrangement (MLA) or the equivalent 

390 for product certification competency, or both. EPA would also require that ABs: 

391 

392  Conform with ISO/IEC 17011, which lists the basic criteria for an international 

accrediting body who reviews and audits the TPC2 393 ; 

394  Submit an application to enter into a recognition agreement with EPA. The 

395 application would include their contact information; documentation of their IAF 

396 MLA, ILAC MRA, or equivalent signatory status; and a description of any other 

397 qualifications related to performing product or laboratory accreditation. The 

398 recognition agreement would need to be renewed every three years; 

399  Notify EPA in the following instances: loss of signatory status; TPC application; TPC 

400 accreditation; TPC compliance failure; organization policy or management structure 

401 changes that could adversely affect accreditation program; and with checklists and 

402 other records documenting compliance with systems audits and on-site assessments; 

403  Notify TPCs if the AB withdraws or is removed from the program; 

404  Maintain records documenting TPC accreditation applications, and checklists and 

405 other records documenting compliance with systems audits and on-site assessments. 

406 Applications must be retained for a minimum of five years from the date that the 

407 TPC’s accreditation terminates; and 

408  Provide an annual report to EPA with the number of TPC applications received; the 

409 number of TPCs approved and denied; the names and contact information of all 

410 accredited TPCs; the number and locations of systems audits and on-site assessments; 

411 and the results of accredited TPC proficiency testing and inter-laboratory 

412 comparisons. 

413 

414 3.1.2 Requirements for TPCS 

415 

 2

 In order to become an IAF or ILAC signatory, an AB is reviewed by its peers to ensure that it is in compliance with 

ISO/IEC 17011, as well as to verify that it is qualified to ensure TPC compliance with other voluntary consensus 

standards. Therefore, it is assumed that IAF or ILAC signatories are already in conformance with ISO/IEC 17011, and 

would not incur additional costs for conformance as a result of this rule. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 17

416 The proposed rule would require that TPCs: 

417 

418  Conform to ISO/IEC Guide 65 (general requirements for bodies operation product 

419 certification systems) and ISO/IEC 17020 (general criteria for the operation of 

420 various types of bodies performing inspection); 

421  Use a laboratory that conforms to ISO/IEC 17025 (requirements for competence of

422 calibration and testing laboratories); and 

423  Be qualified to administer the approved formaldehyde test methods they will be 

424 using. 

425 

426 EPA would also require the following recordkeeping and reporting activities for TPCs: 

427 

428  Submit an application to the Product accreditation body every two years with 

429 domestic contact information; type of composite wood product(s) intended to be 

430 certified; and a description of experience with ISO/IEC Guide 65, ISO/IEC 17020, 

431 and the product(s) the intended to be certified; 

432  Submit an application to the Laboratory accreditation body every two years with 

433 domestic contact information; and a description of experience with test method 

434 ASTM E-1333-96 and in evaluating correlation between tests, performing 

435 formaldehyde tests on composite wood products, and operating or using laboratories 

436 that comply with ISO/IEC 17025; 

437  Maintain records for five years that document the certified manufacturers and 

438 products, including those approved for reduced testing; the results of inspections, 

439 audits, and emissions tests; the laboratories and tests used; and the methods and 

440 results for establishing test method correlations; 

441  Provide an annual report to its accrediting body or bodies with a list of manufacturers 

442 and products certified during the previous year; a list of non-complying products or 

443 events; a list of laboratories and tests used by the TPC; and the results of inter444 laboratory comparison or proficiency tests for laboratories used by the TPC; and 

445  Inform accreditation body or bodies within 30 days of any changes in personnel 

446 qualifications, procedures, or laboratories used by the TPC. 

447 

448 3.2 Wage Rates Used in the Analysis 

449 

450 The proposed rule involves activities that may require efforts by employees in three labor 

451 classifications: managerial, technical, and clerical. Costs for each activity are calculated by 

452 estimating the labor hours required in each labor category and multiplying those burdens by the 

453 wage rate for each labor category. This section summarizes the estimated wage rate in each 

454 labor category. Additional details are provided in Appendix A. 

455 

456 Loaded wage rates for managerial, technical, and clerical personnel are derived by 

457 combining data on wages and fringe benefits with estimates of overhead rates, following the 

458 methodology described in “Wage Rates for Economic Analysis of the Toxics Release Inventory 

459 Program” (EPA, 2002b). Wage data for each labor category are provided by the Employer Costs 

460 for Employee Compensation (ECEC) Supplemental Tables available on the BLS website (U.S. 

461 Bureau of Labor Statistics 2011). The loaded wage rate for managerial labor is $66.78; for 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 18

462 technical labor, $56.31; and for clerical labor, $25.65. Table 3-1 presents the basic data used to 

463 calculate the loaded wage rates for all three categories of labor. 

Table 3-1: Loaded Industry Wage Rates, 2010$ 

Labor Category 

Base 

Wages 

Fringe benefits + 

overhead factor 

Loaded 

Wages 

Managerial $42.42a 1.57b,c $66.78 

Professional/ 

Technical $36.57a 1.54b,c $56.31 

Clerical $16.72a 1.53b,c $25.65 

Notes: 

a Base wages are estimated in the ECEC Supplemental Tables (U.S. Bureau of Labor Statistics 2011). b Fringe benefits are estimated in the ECEC Supplemental Tables (U.S. Bureau of Labor Statistics 2011). c An overhead rate of 17% of base wages is used here, based on methodology and assumptions in U.S. 

Environmental Protection Agency 2002a, b. 

Source:U.S. Bureau of Labor Statistics 2011, U.S. Environmental Protection Agency 2002a, b. 

464 

465 3.3 Costs to Accreditation Bodies 

466 

467 The proposed TSCA Title VI TPC rule requires accreditation bodies to be signatories to 

468 IAF, ILAC or equivalent oversight bodies. The process of becoming a signatory is time469 intensive and may take up to a year to complete, so it is unlikely that additional bodies will 

470 become signatories as a result of the TSCA Title VI TPC rule (Personal Communication with 

471 IAS 2011). Thus, costs are estimated assuming that only existing IAF and ILAC signatories will 

472 serve as accrediting bodies for the third-party certifiers under this regulation. Therefore, the 

473 estimated incremental costs to the accrediting bodies related to the proposed rule will include: 

474 

475 1. Rule Familiarization: Reading the rule in order to understand the requirements; 

476 2. Application Submission: Submitting an application to enter into a recognition 

477 agreement with EPA; 

478 3. Prepare Recognition Agreement: If the application is approved, enter into a 

479 recognition agreement with EPA; 

480 4. EPA Notification: Provide EPA with notifications in the following instances: 

481 loss of signatory status; TPC application; TPC accreditation; TPC compliance 

482 failure; organization policy or management structure changes that could adversely 

483 affect accreditation program; and provide checklists and other records 

484 documenting compliance with systems audits and on-site assessments; 

485 5. TPC Notification: Provide TPCs with notifications if the AB withdraws or is 

486 removed from the program; 

487 6. Recordkeeping: Maintain records documenting TPC accreditation applications, 

488 and checklists and other records documenting compliance with systems audits and 

489 on-site assessments. Applications must be retained for a minimum of five years 

490 from the date that the TPC’s accreditation terminates; and 

491 7. Reporting: Provide an annual report to EPA with the number of TPC 

492 applications received; the number of TPCs approved and denied; the names and 

493 contact information of all accredited TPCs; the number and locations of systems 

494 audits and on-site assessments; and the results of accredited TPC proficiency 

495 testing and inter-laboratory comparisons. 

496 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 19

497 Accreditation bodies are required to renew their recognition agreement with EPA every 

498 three years. This analysis assumes that accreditation bodies incur application submission and 

499 recognition agreement preparation costs in the first year and subsequently every three years 

500 thereafter. Costs associated with EPA notification, TPC notification, recordkeeping and 

501 reporting are assumed to be incurred annually. Rule familiarization is a one-time cost incurred in 

502 the first year. As a result, accreditation bodies are expected to incur costs of $1,685 in the first 

503 year, $1,070 in reapplication years, and $633 in the non-reapplication years, as summarized below in 

504 Table 3-2 and described in more detail in Appendix B (see Table B-1 and Table B-3). This analysis 

505 assumes that eight organizations in the U.S. will become accreditation bodies, resulting in estimated total 

506 annualized costs of $6,204 per year at a three percent discount rate, and $6,222 per year at a seven 

507 percent discount rate. 

508 

Table 3-2: Costs for Accrediting Bodies

Type of Cost Cost (2010$) 1

First Year Reapplication Years 2 Non-Reapplication Years 3

Rule Familiarization $615 $0 $0 

Application or Reapplication Process 1 $88 $88 $0 

Prepare Recognition Agreement $349 $349 $0 

EPA Notification $57 $57 $57 

TPC Notification $12 $12 $12 

Recordkeeping $308 $308 $308 

Reporting $256 $256 $256 

Cost per Accrediting Body $1,685 $1,070 $633 

Number of U.S. Accrediting Bodies 8 8 8 

Total Costs for U.S. Accrediting Bodies $13,480 $8,560 $5,064 

Total Annualized Costs (30 years, 3%) 4 $6,204 

Total Annualized Costs (30 years, 7%) 4 $6,222 

Notes: 

1 See Table B-1 and Table B-3 for detailed description of these estimates. 2

 Under the proposed rule, accreditation bodies are required to reapply every three years. Reapplication is assumed to occur at the 

end of years 3, 6, 9, 12, 15, 18, 21, 24, 27, and 30. 

3

 Non-reapplication years are years 2, 4, 5, 7, 8, 10, 11, 13, 14, 16, 17, 19, 20, 22, 23, 25, 26, 28, and 29. 4 Costs are annualized over thirty years for 3 and 7 percent discount rates using the following formula: 

(present discounted value of 30-year stream-of-costs)*(discount rate*(1+ discount rate)30)/((1+ discount rate)31-1). Rule 

familiarization, application costs, and recognition agreement costs are assumed to be incurred immediately and therefore are not discounted. 

Other costs are discounted assuming that they are incurred at the end of each year.

509 

510 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 20

511 3.4 Third-Party Certifier Costs 

512 

513 Costs that TPCs may incur under the proposed rule can be classified into five categories: 

514 (1) the cost of rule familiarization, (2) the cost of applying to the accreditation body in order to 

515 participate in the TSCA Title VI program, (3) the cost to obtain and maintain any necessary 

516 accreditations that the TPC does not already have, (4) the annual cost of providing notifications 

517 to manufacturers and of maintaining records, and (5) the cost of providing an annual report and 

518 other notifications to the AB or EPA. To the extent that requirements in the TSCA Title VI rule 

519 are similar to requirements in the CARB rule, CARB-approved TPCs will incur relatively little 

520 additional cost to comply with EPA’s rule. 

521 

522 Under the proposed rule, TPCs are required to apply for re-accreditation every two years. 

523 As a result, application and accreditation costs are incurred every other year. The costs 

524 associated with notifications, maintaining records, and providing an annual report are assumed to 

525 be incurred on an annual basis. Rule familiarization is a one-time cost incurred in the first year. 

526 Each of these types of costs is discussed in more detail in the subsections below. 

527 

528 3.4.1 TPC Rule Familiarization 

529 

530 The level of effort associated with rule familiarization was estimated based on 

531 professional judgment, and burden hours were multiplied by the corresponding labor category’s 

532 wage rate as derived in Section 3.2 (U.S. Bureau of Labor Statistics 2011) to estimate costs. As 

533 shown in Table 3-3 below, the total cost for each firm is estimated to be $615 in the first year. 

534 

Table 3-3: Application Process Burden and Costs for TPCs, by Activity 

Activity 

Clerical 

Burden/Cost 

Technical 

Burden/Cost 

Managerial 

Burden/Cost Total 

(hours)1 (2010$) (hours)1 (2010$) (hours)1 (2010$) (hours)1 (2010$) 

(a) (b) (c) (d) (e) (f) (g)=(a)+(c)+(e) (h)=(b)+(d)+(f) 

Rule Familiarization 0.00 $0.00 5.00 $281.55 5.00 $333.90 10.00 $615 

Notes: 1. Burden hours are based on best professional judgment. 

535 

536 3.4.2 TPC Application Process 

537 

538 The application process for TPCs includes completing a form with standard information 

539 about the firm and also describing the firms experience with the ISO/IEC standards. The level of 

540 effort for these elements were estimated based on prior economic analyses (U.S. Environmental 

541 Protection Agency 2011), and burden hours were multiplied by the corresponding labor 

542 category’s wage rate as derived in Section 3.2 (U.S. Bureau of Labor Statistics 2011) to estimate 

543 costs. As shown in Table 3-4 below, the total cost for each firm is estimated to be $492 in 

544 reapplication years and $0 in non-reapplication years. For more information, see Appendix B. 

545 

546 A TPC must reapply every two years in order to participate in the TSCA Title VI 

547 program. TPCs that are approved by CARB will be grandfathered under the TSCA Title VI rule 

548 for one year, provided that they are compliant with all other aspects of the TSCA Title VI rule. 

549 To simplify the analysis, costs are calculated as though all Title VI TPCs are grandfathered in for 

550 one year, even though some of them may not have been approved by CARB. Thus, costs are 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 21

551 calculated assuming that reapplication occurs every other year starting three years after the rule 

552 is promulgated (i.e., in years 3, 5, 7, 9, etc.).
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 22Table 3-4: Application Process Burden and Costs for TPCs, by Activity 

Activity 

Clerical Burden/Cost Technical Burden/Cost Managerial Burden/Cost 

(hours) 

(a) 

(2010$)1

(b) 

(hours) 

(c) 

(2010$)1

(d) 

(hours) 

(e) 

(2010$)1

(f) 

(h

(g)=(a

Product Accreditation Body Application Submission Company Information (Name, Address, Telephone Number, and Email Address of Primary Contact) and Type of Composite Wood Products Applicant Intends to Certify2

0 $0.00 0.04 $2.25 0.02 $1.34 

Description of TPC's Experience or Ability in Product Certification and Complying with ISO/IEC Guide 653

0 $0.00 0.83 $46.74 0.51 $34.06 

Description of TPC's Experience in the Composite Wood Product Industry with the Product(s) Intended to be Certified3

0 $0.00 0.83 $46.74 0.51 $34.06 

Description of TPC's Ability to Inspect and Properly Train and Supervise Inspectors Pursuant to ISO/IEC 170203

0 $0.00 0.83 $46.74 0.51 $34.06 

Laboratory Accreditation Body Application SubmissionCompany Information (Name, Address, Telephone Number, and Email Address of Primary Contact; if foreign, name and address of an agent for service located in the U.S.)2

0 $0.00 0.04 $2.25 0.02 $1.34 

Description of TPC's Experience in Performing or Verifying Formaldehyde Testing on Composite Wood Products3

0 $0.00 0.83 $46.74 0.51 $34.06 

Description of TPC's Experience Operating or Using Laboratories that Comply with ISO/IEC 170253

0 $0.00 0.83 $46.74 0.51 $34.06 

Description of TPC's Experience with Test Method ASTM E-1333-96 (2002) and Experience Evaluating Correlation between Test Methods3

0 $0.00 0.83 $46.74 0.51 $34.06 

TOTAL – REAPPLICATION YEARS 0.00 $0.00 5.06 $284.93 3.10 $207.02 

TOTAL – NON-REAPPLICATION YEARS 0.00 $0.00 0.00 $0.00 0.00 $0.00 

Notes: 1. Note that under the proposed rule, TPCs are required to apply for re-accreditation every two years. As a result, reapplication costs are incurr2. Based on the estimated burden associated with reporting “company information” (U.S. Environmental Protection Agency 2011). 

3. Based on the estimated burden associated with answering substantiation questions when making plant site confidentiality claims (U.S. EnvironmentSource: U.S. Environmental Protection Agency 2011

553 
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March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 23

554 3.4.3 TPCs Obtaining Accreditation for the Required Standards 

555 

556 Through a series of telephone interviews, representatives from six laboratories that have 

557 been approved by CARB for formaldehyde testing provided information about the accreditations 

558 they already had, and the costs of receiving and maintaining the accreditation. Several 

559 laboratories also spoke in general terms about the costs of accreditation. The information 

560 collected from each laboratory is included in Table 3-5. 

561 

562 As indicated in Table 3-5, the cost to TPCs of obtaining accreditation will depend on 

563 whether they have the systems and equipment in place to satisfy the accreditation requirements 

564 or whether they will have to establish these. Based on the telephone interviews, the initial cost 

565 of obtaining a single accreditation is about $20,000 to $30,000 for each quality system. This 

566 analysis uses the mid-point of the range, $25,000, as the cost estimate. The cost would be about 

567 three times that if the firm needed to be newly accredited for all three relevant ISO/IEC standards 

568 (Guide 65, 17020, and 17025). Based on discussions with the six TPCs, the analysis assumes 

569 that two-thirds of the CARB-certified TPCs will already have all three accreditations in place 

570 and that one-third will need to obtain one additional accreditation from an AB. As a result, this 

571 analysis assumes that one-third of TPCs will incur a cost of $25,000 to obtain one additional 

572 accreditation, while two-thirds of TPCs will not incur any additional costs associated with 

573 obtaining additional accreditations. 

574 

575 In addition to obtaining the initial accreditation, the TPCs will need to maintain and 

576 renew their systems and testing certifications. (A typical accreditation lasts for two years.) Two 

577 of the six TPCs provided information on the cost of maintaining and renewing accreditations. 

578 They reported costs that ranged from $5,000 to $15,000 per year associated with maintaining 

579 certification, such as paying audit fees to their AB. Note that the systems and testing 

580 certifications for which the laboratories reported costs may cover more than the specific 

581 formaldehyde testing. Therefore, these estimates may overstate costs if the labs would incur 

582 these costs even if they were not acting as TPCs under TSCA Title VI. Because the audits 

583 include tests other than formaldehyde, this analysis uses $5,000 (the low end of the costs 

584 reported) as the annual reaccreditation cost for TPCs that need an additional accreditation. 

585 

586 As discussed above, based on discussions with the six TPCs, the analysis assumes that 

587 two-thirds of the CARB-certified TPCs will already be maintaining all three of the relevant 

588 accreditations (i.e., ISO/IEC Guide 65, 17020, and 17025) and that one-third of TPCs will need 

589 to maintain a single additional accreditation in order to participate in the TSCA Title VI 

590 program. Thus, one-third of TPCs are assumed to incur an annual cost of $5,000 per year in 

591 subsequent years for maintaining one additional accreditation, while two-thirds of TPCs will not 

592 incur any additional costs associated with maintaining additional accreditations because they 

593 were already maintaining all of the necessary accreditations in the baseline. 

594 

595 In interviews with TPCs, three said they had excess capacity for additional testing and 

596 two said they could easily add extra capacity either by building additional chambers or 

597 subcontracting the work to accredited laboratories. For example, one said that while they 

598 currently have 3 small chambers, within two months they could add 25 small chambers that 

599 would allow them to do 100 tests per day. In addition, it would be possible to add large chamber 

600 capacity within a 3-6 month period. The firms indicated that if the new equipment added were 
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March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 24

601 similar to what they already had in place, their accrediting body would allow for desk audit 

602 approval (which could be done quickly, instead of requiring a site visit prior to approval, which 

603 would take more time). Therefore, this analysis assumes there is adequate existing testing 

604 capacity, and that no additional costs for adding additional testing capacity will be incurred. 

605 

Table 3-5: CARB TPCs Estimates of Previous Accreditation Costs 

Laboratory Estimated Cost of Accreditation Other Information 

NSF International 1 About $5,000 for application process and 

between $5,000 for approval of 10 test 

processes to $20,000 for approval of 100 test 

processes. (The tests are grouped in 

disciplines and priced for each discipline. For 

this conversation the representative was 

discussing batteries of tests, for example toys 

have 10 tests.) 

Estimated that it would cost about $10,000 every 

two years to get reaccredited (or $5,000 a year 

average). 

PSI, Inc. $5,000 to $6,000 if laboratory has 

accreditations, inspections, testing and quality 

systems in place. Estimated $50,000 to 

$60,000 to develop the accreditations, 

inspections, testing and quality systems if they 

are not in place. 

SCS International Estimated it cost about $9,000 to $15,000 to 

write manual and complete application. SCS 

already had the quality system in place. 

Mentioned that CARB does not require ISO 

accreditation as long as the laboratory has 

demonstrated ISO equivalence. Getting ISO 

accreditation is expensive ($25,000). They do not 

have a lab but contract the testing portion out to 

labs that are ISO 17025 accredited. 

NTA Incorporated Estimated it cost $10,000 to set up their 

CARB accredited program. They were 

already an ISO product certification firm. 

Forestwood Industries, 

Inc 

For CARB, they needed ISO 17025 and 

Guide 65 which they did not have. Each cost 

between $20,000 and $30,000 to get. The 

application took one day to complete but 

gathering the information took longer. 

PFS Corporation PFS is a product testing laboratory and had 

IAS approval for testing formaldehyde. The 

cost of a new accreditation is at least $2,550 

with $800 for additional fields of testing 

(formaldehyde could be considered a field) 

and another $250 for each facility. 

It costs PFS about $15,000 to get an IAS on-site 

audit each year although the audit includes more 

than formaldehyde. The cost for a desk audit to 

add an additional small test chamber where 

existing small chambers have already been 

approved is $600, but it costs at least $2,000 for a 

standard inspection audit. 1

NSF International was approved as a TPC by CARB, but has subsequently withdrawn from the program. 

Sources: Personal Communication with Forestwood Industries 2011, Personal Communication with NSF International 2011a, b, 

Personal Communication with NTA Inc. 2011, Personal Communication with PFS Corporation 2011, Personal Communication 

with PSI 2011, Personal Communication with SCS International 2011. 

606 
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March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 25

607 3.4.4 Annual Cost of TPCs Notifications Relating to Manufacturers 

608 

609 Under the proposed rule, TPCs would have to provide its third-party certifier number to 

610 any manufacturer receiving its TSCA Title VI certification services. And should a TPC 

611 withdraw from the program or lose its accreditation, it would be required to notify all 

612 manufacturers that receive its TSCA Title VI certification services. 

613 

614 Upon request, TPCs must provide EPA with a list of the manufacturers and their product 

615 types certified, the results of inspections, audits, and emission tests conducted for each 

616 manufacturer and product type, the list of the TPCs laboratories, test methods, and test results, 

617 the methods and results for establishing test method correlations and equivalence and the list of 

618 manufacturers and products approved for reduced testing. As shown in Table 3-6 below, the 

619 sum of these costs is approximately $773 per firm per year in all years. For more information, 

620 see Appendix B. 

621 

622 

623 
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March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 26

624 

Table 3-6: Annual Burden and Cost to TPCs of Notifications Relating to Manufacturers, by Activity 

Activity 

Clerical Burden/Cost Technical Burden/Cost Managerial Burden/Cost 

(hours) 

(a) 

(2010$) 

(b) 

(hours) 

(c) 

(2010$) 

(d) 

(hours) 

(e) 

(2010$) 

(f) 

(h

(g)=(a

Notifications to EPA Third Party Certifier Number1 0 $0.00 0.04 $2.25 0.02 $1.34 Withdraw from Program or Lose Accreditation1 0 $0.00 0.01 $0.56 0.005 $0.33 Recordkeeping and Reporting to EPAList of Manufacturers and their Product Types (including Resins Used) Certified by TPC2 0.75 $19.24 1.5 $84.47 0.75 $50.09 Results of Inspections, Audits, and Emission Tests Conducted for Each Manufacturer and Product Type2

0.75 $19.24 1.5 $84.47 0.75 $50.09 

List of the TPC's Laboratories, Test Methods (including Test Conditions and Conditioning Time), and Test Results2

0.75 $19.24 1.5 $84.47 0.75 $50.09 

Methods and Results for Establishing Test Method Correlations and Equivalence2 0.75 $19.24 1.5 $84.47 0.75 $50.09 List of Manufacturers and Products Approved for Reduced Testing2 0.75 $19.24 1.5 $84.47 0.75 $50.09 

TOTAL 3.75 $96.20 7.55 $425.14 3.775 $252.09 

Notes: 1. Based on best professional judgment and rule requirements. 2. Based on the estimated burden associated with “recordkeeping” (U.S. Environmental Protection Agency 2011). Sources: U.S. Bureau of Labor Statistics 2011, U.S. Environmental Protection Agency 2011

625 626 
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March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 27

627 3.4.5 Cost of TPC Annual Reports and Notifications of Changes 

628 

629 Table 3-7 shows the cost of the required annual report to the accreditation bodies that 

630 lists the manufacturers and their products certified by TPCs during the previous year, the list of 

631 non-complying products or events by manufacturer, the list of laboratories and test methods used 

632 by the TPC, and the results of inter-laboratory comparison or proficiency testing for the 

633 laboratories used by the TPC. The cost of notifying the accreditation board of any changes in 

634 personnel, procedure, or laboratory changes is also included. The sum of these costs is 

635 approximately $210 per firm per year in all years. For more information, see Appendix B.
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March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 28Table 3-7: Annual TPC Burden and Costs for Reporting to Accrediting Body, by Activity 

Activity 

Clerical Burden/Cost Technical Burden/Cost Managerial Burden/Cost 

(hours) 

(a) 

(2010$) 

(b) 

(hours) 

(c) 

(2010$) 

(d) 

(hours) 

(e) 

(2010$) 

(f) 

(h

(g)=(a

Annual Report to Accreditation Bodies List of Manufacturers and their Products Certified by the TPC during the Previous Year (including Resins Used, and the Average and Range of Formaldehyde Emissions by Manufacturer, Resin, and Product Type)1

0.25 $6.41 0.5 $28.16 0.25 $16.70 

List of Non-complying Products or Events by Manufacturer1 0.25 $6.41 0.5 $28.16 0.25 $16.70 List of Laboratories and Test Methods Used by the TPC1 0.25 $6.41 0.5 $28.16 0.25 $16.70 Results of Inter-Laboratory Comparison or Proficiency Testing for the Laboratories Used by the TPC1

0.25 $6.41 0.5 $28.16 0.25 $16.70 

Accreditation Board Notification Personnel Qualification Changes2 0 $0.00 0.02 $1.13 0.01 $0.67 Procedure Changes2 0 $0.00 0.02 $1.13 0.01 $0.67 Laboratory Change2 0 $0.00 0.02 $1.13 0.01 $0.67 

TOTAL 1 $25.65 2.06 $116.00 1.03 $68.78 

Notes: 1. Estimated as one-third of the burden associated with "recordkeeping" (U.S. Environmental Protection Agency 2011). Revised estimate base

judgment. 2. Based on the estimated burden associated with reporting "company information" (U.S. Environmental Protection Agency 2011). Sources: U.S. Environmental Protection Agency 2011

636 637 
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March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 29

638 3.5 Total Cost to TPCs 

639 

640 3.5.1 Costs per TPC in the First Year 

641 

642 Table 3-8 presents the estimated costs for TPCs in the first year. There are different cost 

643 estimates for TPCs that already have all of the necessary accreditations, and TPCs that need to 

644 obtain an additional accreditation. 

645 

Table 3-8: Costs per TPC in the First Year

Type of Cost 

Cost (2010$)1

TPCs with All Necessary 

Accreditations 

TPCs Obtaining One 

Additional Accreditation 

Rule Familiarization $615 $615 

Application Process $492 $492 

Obtaining Accreditation $0 $25,000 

Manufacturer Notification and Recordkeeping $773 $773 

Annual Report and Notifications of Changes $210 $210 

TOTAL $2,090 $27,090 

646 

647 

648 3.5.2 Costs per TPC in Subsequent Years 

649 

650 Table 3-9 presents the estimated costs incurred in subsequent years by TPCs. Again, 

651 there are different cost estimates for TPCs that already have all of the necessary accreditations, 

652 and TPCs that need to obtain an additional accreditation. And costs differ between years when 

653 the TPC must reapply to the accreditation body to participate in the TSCA Title VI program 

654 (which occurs every two years) and the alternate years. 

655 

Table 3-9: Costs per TPC in Subsequent-Years

Type of Cost1

Cost (2010$)2

TPCs with All Necessary 

Accreditations 

TPCs Obtaining One 

Additional Accreditation 

Reapplication Process $492 $492 

Reaccreditation $0 $5,000 

Manufacturer Notification and Recordkeeping $773 $773 

Annual Report and Notifications of Changes $210 $210 

TOTAL – REAPPLICATION YEARS $1,475 $6,475 

TOTAL – NON-REAPPLICATION YEARS $983 $5,983 

Notes: 1. Under the proposed rule, TPCs are required to apply for re-accreditation every two years. As a result, reapplication and 

reaccreditation costs are incurred every other year. 

2. Costs may not sum due to rounding.

656 

657 

658 3.5.3 Total Cost to U.S. TPCs 

659 

660 Table 3-10 summarizes the total costs to U.S. firms assumed to become TPCs under the 

661 TSCA Title VI program. As indicated, the rule is expected to cost the affected TPCs a total of 

662 $93,817 in the first year, $28,280 in reapplication years, and $23,852 in non-reapplication years. 

663 Annualized costs were also calculated, over a 30-year period, at three and seven percent discount 

664 rates. 

665 
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March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 30

Table 3-10: Total Costs to U.S. TPCs (2010$) 

Cost Component 

Cost (2010$) 

TPCs with All 

Necessary Accreditation 

TPCs Obtaining One 

Additional 

Accreditation 

Total 

Number of Affected Firms 6 3 9 

Per Firm Costs: Year 1 $2,090 $27,090 - 

Per Firm Costs: Reapplication Years $1,475 $6,475 - 

Per Firm Costs: Non-reapplication Years $983 $5,983 - 

Total First Year Costs $12,540 $81,270 $93,810 

Total Reapplication Year Costs $8,850 $19,425 $28,275 

Total Non-Reapplication Year Costs $5,898 $17,949 $23,847 

30-Year Annualized Costs (3 percent discount rate) $7,212 $20,706 $27,917 

30-Year Annualized Costs (7 percent discount rate) $7,130 $21,630 $28,760 

Note: Costs are annualized over thirty years for 3 and 7 percent discount rates using the following formula: (present discounted 

value of 30-year stream-of-costs)*(discount rate*(1+ discount rate)30)/((1+ discount rate)31-1). Rule familiarization costs are 

assumed to be incurred immediately and therefore are not discounted. Other costs are discounted assuming that they are incurred

at the end of each year. 

666 

667 

668 3.6 Total Costs of the Rule for U.S. Accrediting Bodies and TPCs 

669 

670 This section calculates the total cost for U.S. TPCs and accrediting bodies as a result of 

671 the TSCA Title VI TPC rule. While the costs analysis is limited to domestic entities, the burden 

672 analysis in Section 4.1 includes both foreign and domestic entities. 

673 

674 The different cost components of the rule (initial costs; notification, reporting, and 

675 recordkeeping costs; TPC reapplication costs; and AB reapplication costs) are incurred at 

676 different times and with different frequencies. Figure 2 demonstrates how the different cost 

677 components occur over the first nine years, and how they are categorized into five different 

678 categories of years, depending on which component occurs in that year. These same five 

679 categories are used in Table 3-11 and Table 3-12. Table 3-11 presents the per-firm costs for 

680 accrediting bodies and TPCs in each of these categories of years. Table 3-12 presents the total 

681 costs for the eight U.S. accrediting bodies and nine U.S. TPCs combined. To estimate total 

682 costs, per-firm costs were multiplied by the number of affected firms. Annualized costs were 

683 also calculated, over a 30-year period, at three and seven percent discount rates. 

684 

Figure 2. Timing of Cost Components Over the First Nine Years of the Program

Cost Component Year 1 Year 2 Year 

3 

Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 

Initial costs X 

Notification, reporting, 

and recordkeeping 

X X X X X X X X X 

TPC reapplication X X X X 

AB reapplication X X X 

All TPCs are assumed to have been approved by CARB and thus grandfathered into the federal program for one year, so TPC 

reapplication occurs every 2 years starting in Year 3. AB reapplication occurs every 3 years starting in Year 3. 

Key Description

Initial Applications for ABs and TPCs in Year 1 

Non-Reapplication Years for ABs, Non-Reapplication Years for TPCs
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March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 31

Non-Reapplication Years for ABs, Reapplication Years for TPCs

Reapplication Years for ABs, Non-Reapplication Years for TPCs

Reapplication Years for ABs, Reapplication Years for TPCs

685 

Table 3-11: Cost per Year for Accreditation Bodies and Third Party Certifiers (2010$) 

Year ABs 

TPCs 

Have Necessary 

Accreditation 

Need Additional 

Accreditation 

Per Firm Costs: Year 1 $1,685 $2,090 $27,090 

Per Firm Costs: Years 2, 6, 8, 12, 14, 18, 20, 24, 26, 30 (NonReapplication Years for ABs, Non-Reapplication Years for TPCs) $633 $983 $5,983 

Per Firm Costs: Years 3, 5, 9, 11, 15, 17, 21, 23, 27, 29 (NonReapplication Years for ABs, Re-Application Years for TPCs) $633 $1,475 $6,475 

Per Firm Costs: Years 4, 10, 16, 22, 28 (Reapplication Years for 

ABs, Non-Reapplication Years for TPCs) $1,070 $983 $5,983 

Per Firm Costs: Years 7, 13, 19, 25 (Reapplication Years for ABs, 

Reapplication Years for TPCs) $1,070 $1,475 $6,475 

686 

687 

688 

Table 3-12: Total Costs to U.S. Accreditation Bodies and Third Party Certifiers (2010$) 

Year U.S. ABs 

U.S. TPCs All Affected U.S. 

Firms Have Necessary 

Accreditation 

Need Additional 

Accreditation 

Number of Affected Firms 8 6 3 17 

Total Year 1 Costs $13,480 $12,540 $81,270 $107,290 

Total Costs in Years 2, 6, 8, 12, 14, 18, 20, 24, 

26, 30 (Non-Reapplication Years for ABs, NonReapplication Years for TPCs) $5,064 $5,898 $17,949 $28,911 

Total Costs in Years 3, 5, 9, 11, 15, 17, 21, 23, 

27, 29 (Non-Reapplication Years for ABs, ReApplication Years for TPCs) $5,064 $8,850 $19,425 $33,339 

Total Costs in Years 4, 10, 16, 22, 28 

(Reapplication Years for ABs, NonReapplication Years for TPCs) $8,560 $5,898 $17,949 $32,407 

Total Costs in Years 7, 13, 19, 25 - 

Reapplication Years for ABs, Reapplication 

Years for TPCs 

$8,560 $8,850 $19,425 $36,835 

30-Year Annualized Costs (3 percent discount 

rate) $6,204 $7,212 $20,706 $34,121 

30-Year Annualized Costs (7 percent discount 

rate) $6,222 $7,130 $21,630 $34,983 

Note: Annualized costs are annualized over thirty years for 3 and 7 percent discount rates using the following formula: (present discounted value 

of 30-year stream-of-costs)*(discount rate*(1+ discount rate)30)/((1+ discount rate)31-1). Rule familiarization, AB application costs, and AB 

recognition agreement costs are assumed to be incurred immediately and therefore are not discounted. Other costs are discounted assuming that 

they are incurred at the end of each year. 

689 

690 

691 

692 

693 
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March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 32

694 4 Impact Analyses 

695 

696 In addition to the cost analysis presented in Chapter 3, several other types of impacts are 

697 important to consider in evaluating the effects of a regulation. This chapter presents the 

698 incremental impact of the proposed TPC Rule on: 

699 

700  Paperwork burden, as required by the Paperwork Reduction Act (PRA); 

701  Financial condition of small entities, as required by the Regulatory Flexibility Act 

702 (RFA); 

703  State and Local Governments, as required by the Unfunded Mandates Reform Act; 

704  Federalism, as required by Executive Order 13132–Federalism; 

705  Tribal governments, as required by Executive Order 13175–Consultation and 

706 Coordination with Indian Tribal Governments; 

707  The environmental health risk or safety risk to children due to the regulation, as 

708 required by Executive Order 13045–Protection of Children From Environmental 

709 Health & Safety Risks; 

710  Whether voluntary consensus standards are used in its regulatory activities; and 

711  Low income and minority populations, as required by Executive Order 12898. 

712 

713 4.1 Paperwork Reduction Act Analysis 

714 

715 This section estimates the burden of reporting and recordkeeping for the proposed Third 

716 Party Certification rule. It presents average annual burden and cost estimates for affected 

717 accreditation bodies and third party certifiers over the first three years of the program. The labor 

718 hours and costs per firm are the same as those shown in Chapter 3 – the sum of the rule 

719 familiarization, application, recordkeeping, and reporting burdens and costs. However, the 

720 numbers of firms considered here are greater than in the cost analysis in Chapter 3 because both 

721 domestic and foreign firms are included. 

722 

723 Table 4-1 presents the PRA per-firm labor burdens and costs by the type of affected firm. 

724 The total burden and cost are calculated by multiplying the burdens and costs per firm by the 

725 number of affected firms. 

726 
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March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 33

Table 4-1: Total PRA Burdens and Costs (2010$)

Firm Type Number 

of Firms

Per Firm Burden and Cost Total Burden and Cost 

Labor NonLabor 

Cost 

Labor NonLabor 

Cost Hours Cost Hours Cost 

Year 1 

Domestic Accrediting Body 8 31.0642 $1,685 249 $13,480 

Foreign Accrediting Body 17 31.1242 $1,688 529 $28,696 

Domestic TPC obtaining one additional accreditation 3 37.3250 $2,090 $25,000 112 $6,270 $75,000 

Domestic TPC with current accreditations 6 37.3550 $2,092 224 $12,552 

Foreign TPC obtaining one additional accreditation 9 37.3250 $2,090 $25,000 336 $18,810 $225,000 

Foreign TPC with current accreditations 18 37.3550 $2,092 672 $37,656 

Year 2

Domestic Accrediting Body 8 12.1442 $633 97 $5,064 

Foreign Accrediting Body 17 12.2042 $636 207 $10,812 

Domestic TPC obtaining one additional accreditation 3 19.1650 $983 $5,000 57 $2,949 $15,000 

Domestic TPC with current accreditations 6 19.1950 $983 115 $5,898 

Foreign TPC obtaining one additional accreditation 9 19.1650 $985 $5,000 172 $8,865 $45,000 

Foreign TPC with current accreditations 18 19.1950 $985 346 $17,730 

Year 3

Domestic Accrediting Body 8 12.1442 $633 97 $5,064 

Foreign Accrediting Body 17 12.2042 $636 207 $10,812 

Domestic TPC obtaining one additional accreditation 3 27.3250 $1,475 $5,000 82 $4,425 $15,000 

Domestic TPC with current accreditations 6 27.3550 $1,475 164 $8,850 

Foreign TPC obtaining one additional accreditation 9 27.3250 $1,477 $5,000 246 $13,293 $45,000 

Foreign TPC with current accreditations 18 27.3550 $1,477 492 $26,586 

Three Year Average

Domestic Accrediting Body 8 18.4509 $983.67 148 $7,869.33 

Foreign Accrediting Body 17 18.5109 $986.67 315 $16,773.33 

Domestic TPC obtaining one additional accreditation 3 27.9383 $1,516.00 $11,667 84 $4,548.00 $35,000 

Domestic TPC with current accreditations 6 27.9683 $1,516.67 168 $9,100.00 

Foreign TPC obtaining one additional accreditation 9 27.9383 $1,517.33 $11,667 251 $13,656.00 $105,000 

Foreign TPC with current accreditations 18 27.9683 $1,518.00 503 $27,324.00 

All Entities 61 24.0785 $1,299.52 $2,295.08 1,469 $79,271 $140,000 

727 

728 

729 4.2 Regulatory Flexibility Act Analysis 

730 

731 This section presents the impact of the costs of accreditation under the proposed TSCA 

732 Title VI TPC rule on the financial condition of small entities. The Regulatory Flexibility Act 

733 (RFA) of 1980, amended by the Small Business Regulatory Enforcement Fairness Act 

734 (SBREFA) of 1996, requires regulators to assess the effects of regulations on small entities 

735 including businesses, nonprofit organizations, and governments. In some instances, agencies are 

736 also required to examine regulatory alternatives that may reduce adverse economic effects on 

737 significantly impacted small entities. The RFA requires agencies to prepare an initial and final 

738 regulatory flexibility analysis for each rule unless the Agency certifies that the rule will not have 

739 a significant economic impact on a substantial number of small entities. The RFA, however, 

740 does not specifically define “a significant economic impact on a substantial number” of small 
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March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 34

741 entities. Sections 603 and 604 of the RFA require that regulatory flexibility analyses identify the 

742 types, and estimate the numbers, of small entities to which the rule will apply; and describe the 

743 rule requirements to which small entities will be subject and any regulatory alternatives, 

744 including exemptions and deferral, which would lessen the rule’s burden on small entities. 

745 

746 The TPC rule will affect small businesses and small non-profit organizations. (No small 

747 governments are expected to be affected by the TPC rule.) Under the Regulatory Flexibility Act 

748 (RFA), a “small business” is determined by the U.S. Small Business Administration’s 

749 regulations at 13 CFR 121.201 (which create small business size standards using either a sales or 

750 employment threshold, depending on the nature of the industry), unless an agency establishes an 

751 alternate definition. And unless an agency establishes an alternate definition, under the RFA the 

752 term “small organization” means any not-for-profit enterprise which is independently owned and 

753 operated and is not dominant in its field. The RFA does not provide any guidance on how to 

754 judge whether an organization is dominant in its field. Non-profit TPCs and accreditation bodies 

755 perform the same activities (such as conducting and verifying formaldehyde emissions tests, 

756 accrediting, and auditing) as their for-profit counterparts. In order to interpret the RFA criteria 

757 for small organizations and treat all affected entities consistently, this analysis determines the 

758 size status of non-profits by applying the SBA size thresholds for the NAICS codes the non759 profits are classified in. 

760 

761 To fulfill the requirements of the RFA, this analysis addresses two basic questions 

762 regarding the proposed rule: (1) the number and type of small entities potentially affected, and 

763 (2) the extent of the rule’s potential economic impact on those entities as measured by the costto-revenue ratio for businesses and the cost-to-expenses ratio for small non-profit organizations.3 764 

765 This ratio is a good measure of entities’ ability to afford the costs attributable to a regulatory 

766 requirement, because comparing compliance costs to revenues or expenses provides a reasonable 

767 indication of the magnitude of the regulatory burden relative to a commonly available measure of 

768 economic activity. Where regulatory costs represent a small fraction of a typical entity’s 

769 revenues or expenses, the financial impacts of the regulation on such entities may be considered 

770 as not significant. The impact ratios are calculated using annualized costs, because these costs 

771 are more representative of the continuing costs entities face to comply with the rule. 

772 

773 4.2.1 Small Entity Impacts for Accreditation Bodies 

774 

775 As described in Section 2.2.1, five of the eight U.S. accreditation bodies that are IAF or 

776 ILAC signatories are non-profit organizations, while two are businesses, and one is a federal 

777 government agency. Using the size standard thresholds from the U.S. Small Business 

778 Administration, three of the non-profits and one of the businesses are classified as “small”. Per779 firm costs were calculated as the quotient of the 30-year annualized costs and the number of 

780 affected firms presented in Table 3-2 (i.e., $6,204 ÷ 8), which results in an annualized cost 

781 estimate of $775 per entity per year. Estimated cost impacts ranged from 0.01 percent to 0.15 

782 percent of expenditures for the three small non-profits, and were 0.21 percent of sales for the 

783 small business. As a result, no small accreditation bodies are expected to be significantly 

784 impacted by the rule. 

 3

 Expenses and revenues were close to each other for the non-profit ABs and TPCs that were analyzed, so either 

measurement of impacts would provide similar results. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 35

785 

786 

Table 4-2: Small Entity Impacts for U.S. ABs 

Type 

Annualized Costs 

Per Entity 

(3% discount rate) 

Estimated Number of Small Entities with Impacts 

Under One 

Percent 

Between One 

and Three 

Percent 

Over Three 

Percent 

Non-profits $775 3 0 0 

Business $775 1 0 0 

Total 4 0 0 

787 

788 

789 4.2.2 Small Entity Impacts for Third-Party Certifiers 

790 

791 The cost of the rule to TPCs depends on whether the TPC already has all of the necessary 

792 accreditations. A TPC with all of the accreditations in place is estimated to incur an annualized 

793 cost of $1,202 per year for the required applications, reporting, and recordkeeping, while a TPC 

794 that needs to obtain an additional accreditation is estimated to incur an annualized cost of $6,902 

per year.

4 795 

796 

797 Data were available to make size determinations for four of the nine U.S. TPCs 

798 participating in the CARB program. Using the data in Table 2-1 and the size standard thresholds 

799 from the U.S. Small Business Administration, two of these four TPCs are large businesses, and 

800 two are small non-profit organizations. The small non-profits are assumed to have all of their 

801 accreditations currently in place, and thus incur a cost of $1,202 per year due to the rule, as 

802 shown in Table 4-3. Based on the expenditure data in Table 2-1, both of the small non-profit 

803 TPCs have cost impacts of less than 0.1%. 

804 

Table 4-3: Impacts to Small Non-Profit TPCs in the U.S. 

Type 

Annualized Costs 

Per Entity 

(3% discount rate) 

Estimated Number of Small Entities with Impacts 

Under One 

Percent 

Between One 

and Three 

Percent 

Over Three 

Percent 

Non-profits $1,202 2 0 0 

805 

806 Size information was not located for the remaining five U.S. TPCs. This analysis 

807 assumes that 50 percent of the remaining five TPCs are small businesses, which rounds up to 

808 three additional firms. Based on the information in Section 3.4.3, the analysis also assumes that 

809 two the three will already have all their accreditations in place and that one will need to obtain an 

810 additional accreditation. As a result, the two TPCs with accreditations in place will incur an 

811 estimated annualized cost of $1,202 and the TPC that needs to obtain an additional accreditation 

812 will incur an estimated annualized cost of $6,902. 

813 

814 Data from the 2007 Economic Census data (U.S. Census Bureau 2007) was used to 

815 estimate impacts on the three TPCs that are assumed to be small businesses. The Census data 

816 provided the number of firms in different revenue brackets (less than $100,000 per year, 

 4

 Based on the information in Table 3-10, $7,212 ÷ 6 = $1,202 per year for TPCs that have all accreditations in place, and 

$20,706 ÷ 3 = $6,902 per year for TPCs that need an additional accreditation. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 36

817 $100,000 to $499,999, $500,000 to $999,999, etc.) for the affected NAICS codes (541330, 

818 541380, 541611, and 561990). Revenue thresholds were then back-calculated such that 

819 annualized compliance costs created a one or three percent impact. For example, revenue would 

820 have to be less than $120,200 in order for a firm with all of its accreditations to have at least a 

one percent impact, and less than $40,067 in order to have an impact of at least three percent.5 821 

822 

823 The next step was to interpolate the number of firms below each of these revenue 

824 thresholds, assuming that firms are evenly distributed within a revenue bracket. For example, 

825 out of 125,359 firms in these NAICS codes, the Census reported that 32,987 firms had revenues 

826 of less than $100,000, and 49,013 firms had revenues between $100,000 and $499,999. 

Therefore, as shown in Table 4-4, an estimated 34,967 firms have revenues below $120,200.6 827 

828 

In this example, these 34,967 firms represent 28% of the firms in these NAICS codes. 7 829 

830 Multiplying the two small business TPCs with all necessary accreditations by 28%, and rounding 

831 to the nearest whole number, yields the result that one of these firms is estimated to have impacts 

832 over the one percent level. Performing a similar calculation for the three percent impact level 

833 yields the result that neither of the two small business TPCs with all their accreditations are 

834 predicted to have an impact over the three percent level. So the second TPC with all of its 

835 accreditation has an impact of less than one percent (not shown in Table 4-4). Repeating these 

836 calculations for the small business TPC that needs an additional accreditation yields the result 

837 that it is estimated to have a cost impact between one percent and three percent. 

838 

Table 4-4: : Impacts to Small Business TPCs in the U.S. 

Firm Type 

Annualized 

Costs Per 

Firm (3% 

discount 

rate) 

Associated Revenue 

Thresholds 

Number of Firms 

Below 

Threshold1

Percent of Firms 

Below 

Threshold2

Estimated Number 

of Small TPCs with 

Impacts Over3

1% Impact 

3% 

Impact 

1% 

Impact 

3% 

Impact 

1% 

Impact 

3% 

Impact 

1% 

Impact 

3% 

Impact 

Firms with all 

necessary 

accreditations 

(n = 2) $1,202 $120,200 $40,067 34,967 13,217 28% 11% 1 0 

Firms that need 

to obtain one 

additional 

accreditation 

(n = 1) $6,902 $690,200 $230,067 84,812 45,737 69% 37% 1 0 

Notes: 1. The analysis assumes that firms are distributed evenly within a revenue bracket. 

2. The percentage of firms below the threshold is calculated by dividing the number of firms below the threshold by 125,359 (the 

total number of firms in NAICS codes 541,330, 541380, 541611, and 561990. 

3. The analysis assumes that two of the three small business TPCs will already have accreditations in place and that one will need 

to obtain additional accreditation. 

839 

840 As described in Section 2.2.1, the CARB TPCs appear to be larger than the average firms 

841 in these industries, so Census statistics may underestimate the revenues and overestimate the 

842 impacts on TPCs (which represent just 0.006 percent of the firms in these NAICS codes). 

 5

 For a firm with all of its certifications, compliance cost of $1,202 ÷ 1% impact = $120,200 in revenues, and $1,202 ÷ 

3% impact = $40,067 in revenues. 

6

 32,987 firms under $100,000 + (($120,200 - $100,000) ÷ $499,999) x 49,013 firms between $100,000 and $499,999 = 

34,967 firms under $120,200. 

7

 34,967 firms under $120,200 is 28% of the 125,359 total firms. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 37

843 

844 Table 4-5 summarizes the annualized per-firm costs, and the number of affected number 

845 of TPCs with impacts exceeding the one and three percent levels. Costs are estimated to exceed 

846 the one percent level for two small businesses. However, given that these firms have the 

847 incentive to seek accreditation only if they can pass through their costs to the firms they are 

848 certifying, they are not expected to experience a negative economic impacts as a result of this 

849 proposed rule. 

850 

Table 4-5: Small Entity Impacts for U.S. TPCs 

Certification Status 

Annualized Costs 

Per Entity 

(3% discount rate) 

Small Entity Type 

Estimated Number of Small Entities 

with Impacts 

Under One 

Percent 

Between One 

and Three 

Percent 

Over Three 

Percent 

TPCs with current AB 

certification $1,202 Non-profit 2 0 0 

Business 1 1 0 

TPCs that need to obtain 

new AB certification $6,902 Non-profit 0 0 0 

Business 0 1 0 

Combined 

Non-profit 2 0 0 

Business 1 2 0 

Total 3 2 0 

851 

852 

853 4.2.3 Summary of Small Entity Impacts to ABs and TPCs 

854 

855 As shown in Table 4-6, there are a total of 9 small entities in the U.S. assumed to be 

856 directly affected by the Title VI TPC rule. Five of these are non-profits, all of which are 

857 estimated to have cost impacts of less than one percent of expenditures. Four are businesses, two 

858 of which are estimated to have cost impacts of less than one percent of revenues, and two of 

859 which are estimated to have cost impacts between one percent and three percent of revenues. 

860 

Table 4-6: Summary of Small Entity Impacts to ABs and TPCs 

Entity Type Number of U.S. Entities 

that are Small 

Estimated Number of Small Entities with Impacts 

Under One 

Percent 

Between One and 

Three Percent 

Over Three Percent 

TPCs Non-profit 2 2 0 0 

Business 3 1 2 0 

ABs Non-profit 3 3 0 0 

Business 1 1 0 0 

Combined 

Non-profit 5 5 0 0 

Business 4 2 2 0 

Total 9 7 2 0 

861 

862 4.3 Unfunded Mandates Reform Act (UMRA) 

863 

864 Title II of the Unfunded Mandates Reform Act of 1995, Pub. L. 104-4, establishes 

865 requirements for Federal agencies to assess the effects of their regulatory actions on State, local, 

866 and Tribal governments, and the private sector. Under section 202 of the UMRA, EPA generally 

867 must prepare a written statement, including a cost-benefit analysis, for proposed and final rules 

868 with “Federal mandates” that might result in expenditures by State, local, and Tribal 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 38

869 governments, in the aggregate, or by the private sector, of $100 million or more (when adjusted 

870 annually for inflation) in any one year. 

871 

872 The cost of the proposed TPC rule is well below $100 million per year in any one year. 

873 The rule is not expected to affect State, local, and Tribal governments. 

874 

875 4.4 Executive Order 13132 - Federalism 

876 

877 Executive Order 13132, entitled Federalism (64 FR 43255, August 10, 1999), directs 

878 federal agencies to consider whether a rule has federalism implications (i.e. whether it has 

879 substantial direct effects on the states, on the relationship between the national government and 

880 the states, or on the distribution of power and responsibilities among the various levels of 

881 government, as specified in Executive Order 13132). 

882 

883 The TPC rule does not have a substantial direct effects on states or local governments 

884 (individually or collectively), on the relationship between the national government and the states, 

885 or on the distribution of power and responsibilities among the various levels of government. No 

886 state or local governments are expected to become TPCs or accrediting bodies, and thus state and 

887 local governments will not incur direct compliance costs as a result of the rule. The rule does not 

888 preempt state or local law, and the rule is required by statute. 

889 

890 4.5 Executive Order 13175 - Tribal Implications 

891 

892 Executive Order 13175, entitled Consultation and Coordination with Indian Tribal 

893 Governments (59 FR 22951, November 6, 2000), directs federal agencies to consider whether a 

894 rule has tribal implications (i.e. whether it has substantial direct effects on tribal governments, on 

895 the relationship between the Federal government and the Indian tribes, or on the distribution of 

896 power and responsibilities between the Federal government and Indian tribes). No tribal 

897 government is expected to become a TPC or an accrediting body, and thus tribal governments 

898 will not incur direct compliance costs as a result of the rule. The rule does not change the 

899 relationship between the Federal government and Indian tribes, or change the distribution of 

900 power. 

901 

902 4.6 Executive Order 13045 - Protection of Children 

903 

904 Under Executive Order 13045, a regulation must be reviewed if the regulatory action is 

905 economically significant and concerns an environmental health risk or safety risk that may 

906 disproportionately affect children. The proposed TPC rule is not economically significant 

907 because it will not have an annual impact on the economy of $100 million or more. 

908 

909 4.7 Executive Order 13211 - Energy Effects 

910 Executive Order 13211, entitled Actions Concerning Regulations that Significantly 

911 Affect Energy Supply, Distribution, or Use (66 FR 28355, May 22, 2001), directs federal 

912 agencies to identify actions that will have a significant adverse energy effect. Adverse effects 

913 are defined as: 

914 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 39

915  Reductions in crude oil supply in excess of 10,000 barrels per day; 

916  Reductions in fuel production in excess of 4,000 barrels per day; 

917  Reductions in coal production in excess of 5 million tons per year; 

918  Reductions in natural gas production in excess of 25 million mcf per year; 

919  Reductions in electricity production in excess of 1 billion kilowatt-hours per year or in 

920 excess of 500 megawatts of installed capacity; 

921  Increases in energy use required by the regulatory action that exceed any of the 

922 thresholds above; 

923  Increases in the cost of energy production in excess of one percent; 

924  Increases in the cost of energy distribution in excess of one percent; or 

925  Other similarly adverse outcomes. 

926 

927 The regulations under consideration will not significantly reduce energy production nor 

928 significantly increase energy costs. 

929 

930 4.8 National Technology Transfer and Advancement Act 

931 

932 Section 12(d) of the National Technology Transfer and Advancement Act of 1995 

933 (“NTTAA”), Public Law No. 104-113 (15 U.S.C. 272 note) directs EPA to use voluntary 

934 consensus standards in its regulatory activities unless to do so would be inconsistent with 

935 applicable law or otherwise impractical. Voluntary consensus standards are technical standards 

936 (e.g., materials specifications, test methods, sampling procedures, business practices, etc.) that 

937 are developed or adopted by voluntary consensus standards bodies. NTTAA directs EPA to 

938 provide Congress, through OMB, explanations when the Agency decides not to use available and 

939 applicable voluntary consensus standards. 

940 

941 This proposed rulemaking involves technical standards, and EPA proposes to use 

942 voluntary consensus standards. The proposed framework of this third party certification program 

943 is based on the ability of ABs to review TPCs for their conformity to ISO/IEC Guide 65, 

944 ISO/IEC 17025, and ISO/IEC 17020. Both Product ABs and Laboratory ABs must maintain 

945 their conformity to ISO/IEC 17011 and ISO/IEC Guide 65. 

946 

947 4.9 Executive Order 12898 – Environmental Justice 

948 

949 Under Executive Order 12898, when promulgating a regulation, EPA investigates 

950 whether there are disproportionately high and adverse human health or environmental effects on 

951 minority and low-income populations. Since this proposed rulemaking addresses the process for 

952 accreditation bodies and TPCs, this proposed rule does result in any adverse human health or 

953 environmental effects. 

954 

955 

956 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 40

957 

958 References 

959 California Air Resources Board (2011). List of CARB Approved Third Party Certifiers. 

960 Available at: http://www.arb.ca.gov/toxics/compwood/listoftpcs.htm. 

961 Composite Panel Association (2007). 2007 North American Capacity Report. Available 

962 at: 

963 Dun & Bradstreet (2011). Company Reports. Proprietary Database. 

964 Personal Communication with AHFA (2010). Conversation between Bill Perdue 

965 (American Home Furnishings Alliance) and Abt Associates Inc. 

966 Personal Communication with BIFMA (2010). Brad Miller's (BIFMA) Written 

967 Responses to Questions about FSCWPA Impacts on Members. 

968 Personal Communication with Forestwood Industries (2011). Conversation between Gary 

969 Poserina (Forestwood Industries, Inc.) and Abt Associates Inc. 

970 Personal Communication with IAS (2011). Conversation between Patrick McCullen 

971 (International Accreditation Service) and Abt Associates Inc. 

972 Personal Communication with KCMA (2010). Conversation between Richard Titus 

973 (Kitchen Cabinet Manufacturers Association) and Abt Associates Inc. regarding 

974 written questions about FSCWPA Impacts. 

975 Personal Communication with NALFA (2010). Conversation between Dennis Bradway 

976 (Mannington Floors and North Amnerican Laminate Floor Association) and Abt 

977 Associates Inc. regarding written questions about FSCWPA Impacts. 

978 Personal Communication with NSF International (2011a). Conversation between Kerri 

979 Levanseler (NSF International) and Abt Associates Inc. 

980 Personal Communication with NSF International (2011b). Conversation between Craig 

981 Moore (NSF International) and Abt Associates Inc. 

982 Personal Communication with NTA Inc. (2011). Conversation between Dale Arter (NTA 

983 Inc.) and Abt Associates Inc. 

984 Personal Communication with PFS Corporation (2011). Conversation between James 

985 Van Schoyck and Ron Reindl (PFS Corporation, Inc.) and Abt Associates Inc. 

986 Personal Communication with PSI (2011). Conversation between Randy Webb 

987 (Professional Service Industries, Inc.) and Abt Associates Inc. 

988 Personal Communication with SCS International (2011). Conversation between Michael 

989 Wolfe (SCS International) and Abt Associates Inc. 

990 Personal Conversation with HPVA (2011). Conversation between Kip Howlett (HPVA) 

991 and Abt Associates Inc. 

992 U.S. Bureau of Labor Statistics (2011). Employer Costs for Employee Compensation: 

993 Supplementary Tables: Historical Data: December 2006 - March 2011. Available 

994 at: http://www.bls.gov/ncs/ect/ecsuphst.pdf. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 41

995 U.S. Census Bureau (2007). Statistics for U.S. Businesses (SUSB). Number of Firms, 

996 Number of Establishments, Employment, Annual Payroll, and Estimated Receipts 

997 by Enterprise Receipt Size for the United States, All Industries: 2007. Available 

998 at: http://www.census.gov/epcd/susb/2007/us/US--.HTM 

999 U.S. Census Bureau (2010a). Sector 54: EC0754SSSZ4: Professional, Scientific, and 

1000 Technical Services: Subject Series - Estab & Firm Size: Receipts/Revenue Size of 

1001 Firms for the United States: 2007. Available at: 

1002 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-

1003 ds_name=EC0754SSSZ4&-_lang=en. 

1004 U.S. Census Bureau (2010b). Sector 56: EC0756SSSZ4: Administrative and Support and 

1005 Waste Management and Remediation Services: Subject Series - Establishment 

1006 and Firm Size: Receipts Size of Firms for the United States: 2007. Available at: 

1007 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-

1008 ds_name=EC0756SSSZ4&-_lang=en. 

1009 U.S. Census Bureau (2010c). Sector 81: EC0781SSSZ4: Other Services (Except Public 

1010 Administration): Subject Series - Estab & Firm Size: Receipts/Revenue Size of 

1011 Firms for the United States: 2007. Available at: 

1012 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-

1013 ds_name=EC0781SSSZ4&-_lang=en. 

1014 U.S. Census Bureau (2010d). Sector 31: EC0731I1: Manufacturing: Industry Series: 

1015 Detailed Statistics by Industry for the United States: 2007. Available at: 

1016 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-

1017 ds_name=EC0731I1&-_lang=en. 

1018 U.S. Environmental Protection Agency (1998). Industry Specific Information Collection 

1019 Request (ICR) for the Development of Plywood and Particleboard Maximum 

1020 Achievable Control Technology (MACT) Standards. 

1021 U.S. Environmental Protection Agency (2002a). Economic Analysis for the Amended 

1022 Inventory Update Rule: Final Report (EPA-HQ-OPPT-2002-0054-0260). 

1023 U.S. Environmental Protection Agency (2002b). Wage Rates for Economic Analysis of 

1024 the Toxics Release Inventory Program. 

1025 U.S. Environmental Protection Agency (2011). Supporting Statement for a Request for 

1026 OMB Review under the Paperwork Reduction Act: the Final Rule Addendum to 

1027 Partial Update of the TSCA Section 8(b) TSCA Inventory Data Base, Production 

1028 and Site Reports. 

1029 U.S. Internal Revenue Service (2009). Form 990. Return of Organization Exempt from 

1030 Income Tax. 

1031 U.S. Small Business Administration (2010). Table of Small Business Size Standards 

1032 Matched to North American Industry Classification System Codes. Available at: 

1033 http://www.sba.gov/content/table-small-business-size-standards. 

1034 

1035 6

1037 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule A-1 

1038 Appendix A– Wage Rate Calculations

1039 This appendix describes the derivation of the fully loaded wage rates and inflation factors 

1040 used in calculating costs of labor, materials, and other inputs. All cost estimates are presented in 

1041 fourth quarter, calendar year 2010 dollars, representing the most recent full year of data 

1042 available. 

1043 

1044 The fully loaded unit labor cost for managerial, professional/technical, and clerical labor 

1045 in the regulated industry and for EPA staff is estimated by adding fringe benefits and overhead 

1046 costs to the hourly wage or annual salary for each category following the method described in 

1047 Wage Rates for Economic Analysis of the Toxics Release Inventory Program (EPA, 2002b). This 

1048 appendix describes the method employed to estimate the fully loaded unit labor costs for each 

1049 labor category and presents the results of the analysis. 

1050 

1051 Labor categories used in the analysis correspond to the U.S. Bureau of Labor Statistics 

1052 (BLS) Standard Occupational Classification (SOC) system. In March 2004, BLS began using the 

1053 North American Industry Classification System (NAICS) instead of the Standard Industrial 

1054 Classification (SIC) System, and the Standard Occupational Classification (SOC) system instead 

1055 of the Occupational Classification System (OCS). Exhibit A-1 summarizes the crosswalk 

1056 between old and new occupational titles, and lists the SOC titles that correspond to the 

1057 managerial, professional/technical, and clerical labor categories used in this analysis (Weinstein 

1058 and Loewenstein, 2004). 

1059 

Exhibit A-1: Detail of Labor Categories Used in the Analysis 

Labor Category Used in the Analysis BLS Old Title (OCS) BLS New Title (SOC) 

Managerial Executive, administrative, and 

managerial Management, business, and financial 

Professional/Technical Professional specialty and technical Professional and related 

Clerical Administrative support, including 

clerical Office and administrative support 

Source: BLS (2009); Weinstein and Loewenstein (2004). 

1060 

1061 Wages and fringe benefit data for managerial, professional/technical, and clerical labor 

1062 are from the BLS Employer Costs for Employee Compensation (ECEC) historical data for 

December 2006 – March 2011 (BLS, 2011).8 1063 

1064 

1065 The costs of fringe benefits such as paid leave and insurance, specific to each labor 

1066 category, are taken from the same BLS report (BLS, 2011). Fringe benefits as a percentage of 

1067 wages are calculated separately for each labor category. For example, for December 2010, the 

1068 average wage rate for professional/ technical labor was $36.57, and the average fringe benefit 

was $13.52.9 1069 Therefore, fringe benefits as a percentage of wages were $13.52/$36.57, or 

1070 approximately 37 percent (see Exhibit A-2). 

 8

 Past economic analyses used ECEC data series specific to white-collar workers in the manufacturing sector. However, 

those data sets were discontinued in March 2007, and these historical data were the best alternative. In a phone 

conversation (February 11, 2009), a BLS employee could not identify a better data set to use. 9

 Past economic analyses have used the term “technical” labor. Here the category is called “professional/technical” labor, 

to make clear how it relates to BLS categories. In 2004, BLS changed from the Occupational Classification System, 

OCS, to the Standard Occupational Classification system, SOC. In the process, the “Professional specialty and 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule A-2 

An additional loading factor of 17 percent is applied to wages to account for overhead.10 1071 

1072 This approach is used for consistency with Office of Pollution Prevention and Toxics (OPPT) 

1073 economic analyses for two major rulemakings: Wage Rates for Economic Analyses of the Toxics 

1074 Release Inventory Program, June 2002 (EPA, 2002b), and the Revised Economic Analysis for the 

1075 Amended Inventory Update Rule: Final Report, August 2002 (EPA, 2002a). This overhead 

1076 loading factor is added to the benefits loading factor, and the total is then applied to the base 

1077 wage to derive the fully loaded wage. For example, the December 2010 fully loaded wage for 

1078 professional/technical labor is $36.97 × (1+ 0.37 + 0.17) = $56.31. 

1079 

1080 Fully loaded costs for managerial and clerical labor are calculated in a similar manner, as 

1081 shown in Exhibit A-2. 

1082 

Exhibit A-2: Derivation of Loaded Industry Wage Rates 

Labor 

Category 

Data Source for Wage 

Information Date 

Wage Fringe 

Benefit

Fringes as 

% wage 

Overhead as 

% wage a 

Fringe + 

overhead factor

Loaded 

Wages 

(a) (b) (c)=(b)/(a) (d) (e)=(c)+(d)+1 (f)= 

(a)*(e) 

Clerical 

BLS ECEC, Private 

Professional and Business 

Services Industries, “Office 

and Administrative Support”2 

Dec-10 $16.72 $6.09 36.42% 17% 1.53 $25.65 

Professional/ 

Technical 

BLS ECEC, Private 

Professional and Business 

Services Industries, 

“Professional and related“2 

Dec-10 $36.57 $13.52 36.97% 17% 1.54 $56.31 

Managerial 

BLS ECEC, Private 

Professional and Business 

Services Industries, “Mgt, 

Business, and Financial”2 

Dec-10 $42.42 $17.15 40.43% 17% 1.57 $66.78 

Notes: 

a

 An overhead rate of 17% is used based on assumptions in EPA (2002a) and EPA (2002b). b

 Data for this occupational series found in BLS (2011). 

 technical” category became the “Professional and related” category. However, the coverage of the old and new 

occupational groups is approximately the same. See the BLS article, “Comparing Current and Former Industry and 

Occupation ECEC Series” (Weinstein and Loewenstein, 2004). 10 The change was used in the 2003 PMN SNUR economic analysis (EPA, 2003b). In some earlier reports, the 17 percent 

had been applied to wages-plus-fringe benefits. 
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March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule B-1 

1083 

1084 Appendix B – Recordkeeping and Reporting Burdens

1085 Table B-1 and Table B-2 present the estimated per-activity recordkeeping and reporting 

1086 burdens for accreditation bodies and third party certifiers, respectively. Table B-3 and Table B-4 

1087 present the estimated annual frequency of the recordkeeping and reporting activity as well as the 

1088 associated clerical, technical, and managerial cost. Total costs are calculated as the sum of the 

1089 component costs. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule B-2 

1090 

Table B-1: Recordkeeping and Reporting Burden for Accreditation Bodies, by Activity 

Activity1

Per Activity Burden Hours 

Number of 

Annual Activit

(d) 

Clerical Technical Managerial 

(a) (b) (c) 

1. Rule Familiarization 0.00 5.00 5.00 12. Application Submission 

Company Information (Name, Address, Telephone Number, and Email Address of Primary Contact)2 0.00 0.04 0.02 1Documentation of IAF MLA, ILAC MRA, or Equivalent Signatory Status2 0.00 0.04 0.02 1Description of Any Other Qualifications Related to Experience in Performing Accreditation of Conformity Assessment Bodies or Third Party Certifiers3 0.00 0.83 0.51 1

3. Recognition Agreement4 1.00 1.00 4.00 14. EPA Notification 

Loss of Status as a Signatory to the IAF MLA, ILAC MRA, or Equivalent Organization5 0.00 0.08 0.04 0Third Party Certifier Applications5 0.00 0.08 0.04 3Third Party Certifier Accreditation5 0.00 0.08 0.04 3Third Party Certifier Compliance Failure5 0.00 0.08 0.04 0Third Party Certifier Accreditation Suspension or Revocation (Product ABs) / Accredited Laboratory Compliance Failure (Laboratory ABs)5 0.00 0.08 0.04 0Change to Organizational Policy or Management Structure that Could Adversely Affect Accreditation Program5 0.00 0.08 0.04 0Checklists and Other Records Documenting Compliance with the Requirements for Systems Audits and On-site Assessment of Third Party Certifiers5 0.00 0.08 0.04 1Change in Name or Address of Domestic Agent (Foreign Entities Only)5 0.00 0.08 0.04 0

5. Third Party Certifier Notification 

Unique Tracking Number2 0.00 0.04 0.02 3Withdraw from or be Removed from Program2 0.00 0.04 0.02 0

6. Recordkeeping 

Accreditation Applications6 0.75 1.50 0.75 1Checklists and Other Records Documenting Compliance with the Requirements for Systems Audits and On-site Assessment of Third Party Certifiers6 0.75 1.50 0.75 1

7. Annual Report to EPA 

Number of Third Party Certifier Applications Received7 0.25 0.50 0.25 1Number of Third Party Certifier Applications Approved and Denied7 0.25 0.50 0.25 1The Names and Contact Information of All Accredited Third Party Certifiers7 0.25 0.50 0.25 1Number and Locations of Systems Audits and On-site Assessments7 0.25 0.50 0.25 1Results of Accredited Third Party Certifier Laboratory Proficiency Testing or Inter-laboratory Comparisons7 0.25 0.50 0.25 1
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule B-3 Table B-1: Recordkeeping and Reporting Burden for Accreditation Bodies, by Activity 

Activity1

Per Activity Burden Hours 

Number of 

Annual Activit

(d) 

Clerical Technical Managerial 

(a) (b) (c) 

Domestic Total in First Year Foreign Total in First Year Domestic Total in Year 2 and 3 Foreign Total in Year 2 and 3 Notes: 1. Under the proposed rule, accreditation bodies are required to submit an application to renew their recognition agreement every three years. As a result, this anabodies incur application submission and recognition agreement preparation costs in the first year and subsequently every three years thereafter. 

2. Based on the estimated burden associated with reporting "company information" (EPA 2011). 3. Based on the estimated burden associated with answering substantiation questions when making plant site confidentiality claims (EPA 2011). 4. Based on conversations with accreditation bodies. 5. Based on the estimated burden associated with reporting "company information" (EPA 2011). Values have been doubled based on best professional judgment. 6. Based on the estimated burden associated with "recordkeeping" (EPA 2011). The rule requires that records be kept for 5 years that show the production volume, plant site, and site-limited status of each reported substance. 7. Estimated as one-third of the burden associated with "recordkeeping" (EPA 2011). Estimate based on best professional judgment.

Sources: (1) U.S. Bureau of Labor Statistics. 2011. Employer Costs for Employee Compensation: Supplementary Tables: Historical Data: December 

U.S. Environmental Protection Agency. 2011. Supporting Statement for a Request for OMB Review under the Paperwork Reduction Act: the Final Ru

Update of the TSCA Section 8(b) TSCA Inventory Data Base, Production and Site Reports.

1091 1092 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule B-4 

Table B-2: Recordkeeping and Reporting Burden for Third Party Certifiers, by Activity 

 Per Activity Burden Hours Number 

Annua

Activitie

(d) 

Activity1

Clerical Technical Managerial 

(a) (b) (c) 

1. Rule Familiarization 0.00 5.00 5.00 2. Product Accreditation Body Application Submission 

Company Information (Name, Address, Telephone Number, and Email Address of Primary Contact) and Type of Composite Wood Products Applicant Intends to Certify2

0.00 0.04 0.02 

Description of TPC's Experience or Ability in Product Certification and Complying with ISO/IEC Guide 653 0.00 0.83 0.51 Description of TPC's Experience in the Composite Wood Product Industry with the Product(s) Intended to be Certified3 0.00 0.83 0.51 Description of TPC's Ability to Inspect and Properly Train and Supervise Inspectors Pursuant to ISO/IEC 170203 0.00 0.83 0.51 

3. Laboratory Accreditation Body Application Submission 

Company Information (Name, Address, Telephone Number, and Email Address of Primary Contact; if foreign, name and address of an agent for service located in the U.S.)2

0.00 0.04 0.02 

Description of TPC's Experience in Performing or Verifying Formaldehyde Testing on Composite Wood Products3 0.00 0.83 0.51 Description of TPC's Experience Operating or Using Laboratories that Comply with ISO/IEC 170253 0.00 0.83 0.51 Description of TPC's Experience with Test Method ASTM E-1333-96 (2002) and Experience Evaluating Correlation between Test Methods3 0.00 0.83 0.51 

4. Manufacturer Notification 

Third Party Certifier Number2 0.00 0.04 0.02 Withdraw from Program or Lose Accreditation2 0.00 0.04 0.02 

5. Recordkeeping 

List of Manufacturers and their Product Types (including Resins Used) Certified by TPC4 0.75 1.50 0.75 Results of Inspections, Audits, and Emission Tests Conducted for Each Manufacturer and Product Type4 0.75 1.50 0.75 List of the TPC's Laboratories, Test Methods (including Test Conditions and Conditioning Time), and Test Results4 0.75 1.50 0.75 Methods and Results for Establishing Test Method Correlations and Equivalence4 0.75 1.50 0.75 List of Manufacturers and Products Approved for Reduced Testing4 0.75 1.50 0.75 

6. Annual Report to Accreditation Bodies 

List of Manufacturers and their Products Certified by the TPC during the Previous Year (including Resins Used, and the Average and Range of Formaldehyde Emissions by Manufacturer, Resin, and Product Type)5

0.25 0.50 0.25 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule B-5 

Table B-2: Recordkeeping and Reporting Burden for Third Party Certifiers, by Activity 

 Per Activity Burden Hours Number 

Annua

Activitie

(d) 

Activity1

Clerical Technical Managerial 

(a) (b) (c) 

List of Noncomplying Products or Events by Manufacturer5 0.25 0.50 0.25 List of Laboratories and Test Methods Used by the TPC5 0.25 0.50 0.25 Results of Inter-Laboratory Comparison or Proficiency Testing for the Laboratories Used by the TPC4 0.25 0.50 0.25 

7. Accreditation Board Notification 

Personnel Qualification Changes2 0.00 0.04 0.02 Procedure Changes2 0.00 0.04 0.02 Laboratory Changes2 0.00 0.04 0.02 

8. EPA Notification 

Change in Name or Address of Domestic Agent (Foreign TPCs Only)2 0.00 0.04 0.02 

Domestic Total in First Year Foreign Total in First Year Domestic Total in Non-Reapplication Year (Year 2) Foreign Total in Non-Reapplications Year (Year 2) Domestic Total in Reapplication Year (Year 3) Foreign Total in Reapplications Year (Year 3) Notes: 1. Under the proposed rule, TPCs are required to apply for re-accreditation every two years. As a result, application and accreditation costs are incurred ever

2. Based on the estimated burden associated with reporting "company information" (EPA 2011). 3. Based on the estimated burden associated with answering substantiation questions when making plant site confidentiality claims (EPA 2011). 4. Based on the estimated burden associated with "recordkeeping" (EPA 2011). The rule requires that records be kept for 5 years that show the production volume, plant site, and site-limited status of each reported substance. 5. Estimated as one-third of the burden associated with "recordkeeping" (EPA 2011). Estimate based on best professional judgment. 

Sources: (1) U.S. Bureau of Labor Statistics. 2011. Employer Costs for Employee Compensation: Supplementary Tables: Historical Data: Decem

and (2) U.S. Environmental Protection Agency. 2011. Supporting Statement for a Request for OMB Review under the Paperwork Reduction Act: t

Addendum to Partial Update of the TSCA Section 8(b) TSCA Inventory Data Base, Production and Site Reports.

1093 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule B-6 Table B-3: Recordkeeping and Reporting Labor Costs for Accreditation Bodies, by Activity (2010$) 

Activity Estimated Annual Frequency1 Clerical Cost2 Technical Cost2 Mana

1. Rule Familiarization 1 $0.00 $281.55 2. Application Submission 

Company Information (Name, Address, Telephone Number, and Email Address of Primary Contact)3 1 $0.00 $2.25 Documentation of IAF MLA, ILAC MRA, or Equivalent Signatory Status3 1 $0.00 $2.25 Description of Any Other Qualifications Related to Experience in Performing Accreditation of Conformity Assessment Bodies or Third Party Certifiers4

1 $0.00 $46.74 

Application Submission Subtotal 

3. Recognition Agreement5 1 $25.65 $56.31 4. EPA Notification 

Loss of Status as a Signatory to the IAF MLA, ILAC MRA, or Equivalent Organization6 0.05 $0.00 $0.23 Third Party Certifier Application6 3 $0.00 $13.51 Third Party Certifier Accreditation6 3 $0.00 $13.51 Third Party Certifier Compliance Failure6 0.33 $0.00 $1.49 Third Party Certifier Accreditation Suspension or Revocation (Product ABs) / Accredited Laboratory Compliance Failure (Laboratory ABs)6 0.33 $0.00 $1.49 Change to Organizational Policy or Management Structure that Could Adversely Affect Accreditation Program6 0.2 $0.00 $0.90 Checklists and Other Records Documenting Compliance with the Requirements for Systems Audits and On-site Assessment of Third Party Certifiers6

1 $0.00 $4.50 

Change in Name or Address of Domestic Agent (Foreign Entities Only)6 0.5 $0.00 $2.25 EPA Notification Subtotal (Domestic) EPA Notification Subtotal (Foreign) 

5. Third Party Certifier Notification 

Unique Tracking Number3 3 $0.00 $6.76 Withdraw from or be Removed from Program3 0.25 $0.00 $0.56 TPC Notification Subtotal 

6. Recordkeeping 

Accreditation Applications7 1 $19.24 $84.47 Checklists and Other Records Documenting Compliance with the Requirements for Systems Audits and On-site Assessment of Third Party Certifiers7

1 $19.24 $84.47 

Recordkeeping Subtotal 

7. Annual Report to EPA 

Number of Third Party Certifier Applications Received8 1 $6.41 $28.16 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule B-7 Table B-3: Recordkeeping and Reporting Labor Costs for Accreditation Bodies, by Activity (2010$) 

Activity Estimated Annual Frequency1 Clerical Cost2 Technical Cost2 Mana

Number of Third Party Certifier Applications Approved and Denied8 1 $6.41 $28.16 The Names and Contact Information of All Accredited Third Party Certifiers8 1 $6.41 $28.16 Number and Locations of Systems Audits and On-site Assessments8 1 $6.41 $28.16 Results of Accredited Third Party Certifier Laboratory Proficiency Testing or Inter-laboratory Comparisons8 1 $6.41 $28.16 Annual Report Subtotal 

Domestic Total in First Year Foreign Total in First Year Domestic Total in Year 2 and 3 Foreign Total in Year 2 and 3 Notes: 1. Based on best professional judgment and rule requirements. Under the proposed rule, accreditation bodies are required to submit an application to renew their r

years. As a result, this analysis assumes that accreditation bodies incur application submission and recognition agreement preparation costs in the first year and subseque

2. Based on Employer Costs for Employee Compensation wage and benefit data for private professional and business services industries (BLS 2011a). Clerical costs are 

"office and administrative support" occupational group; technical costs are estimated using data from the "professional and related" occupational group; and managerial cfrom the "management, business, and financial" occupational group. 3. Based on the estimated burden associated with reporting "company information" (EPA 2011a). 4. Based on the estimated burden associated with answering substantiation questions when making plant site confidentiality claims (EPA 2011a). 5. Based on conversations with accreditation bodies. 6. Based on the estimated burden associated with reporting "company information" (EPA 2011a). Values have been doubled based on best professional judgment. 

7. Based on the estimated burden associated with "recordkeeping" (EPA 2011a). The rule requires that records be kept for 5 years that show the production volume, plan

each reported substance. 8. Estimated as one-third of the burden associated with "recordkeeping" (EPA 2011a). Estimate based on best professional judgment.

Sources: (1) U.S. Bureau of Labor Statistics. 2011. Employer Costs for Employee Compensation: Supplementary Tables: Historical Data: December 

U.S. Environmental Protection Agency. 2011. Supporting Statement for a Request for OMB Review under the Paperwork Reduction Act: the Final Ru

Update of the TSCA Section 8(b) TSCA Inventory Data Base, Production and Site Reports.

1094 1095 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule B-8 

Table B-4: Recordkeeping and Reporting Labor Costs for Third Party Certifiers, by Activity (2010$) 

Activity Estimated Annual Frequency1 Clerical Cost2 Technical Cost2 Manageria

1. Rule Familiarization 1.00 $0.00 $281.55 2. Product Accreditation Body Application Submission 

Company Information (Name, Address, Telephone Number, and Email Address of Primary Contact; if foreign, name and address of an agent for service located in the U.S.) and Type of Composite Wood Products Applicant Intends to Certify3

1.00 $0.00 $2.25 

Description of TPC's Experience or Ability in Product Certification and Complying with ISO/IEC Guide 654 1.00 $0.00 $46.74 Description of TPC's Experience in the Composite Wood 

Product Industry with the Product(s) Intended to be Certified4 1.00 $0.00 $46.74 

Description of TPC's Ability to Inspect and Properly Train and Supervise Inspectors Pursuant to ISO/IEC 170204 1.00 $0.00 $46.74 Product Accreditation Subtotal 

3. Laboratory Accreditation Body Application Submission 

Company Information (Name, Address, Telephone Number, and Email Address of Primary Contact; if foreign, name and address of an agent for service located in the U.S.)3

1.00 $0.00 $2.25 

Description of TPC's Experience in Performing or Verifying Formaldehyde Testing on Composite Wood Products4 1.00 $0.00 $46.74 Description of TPC's Experience Operating or Using Laboratories that Comply with ISO/IEC 170254 1.00 $0.00 $46.74 Description of TPC's Experience with Test Method ASTM E1333-96 (2002) and Experience Evaluating Correlation between Test Methods4

1.00 $0.00 $46.74 

Laboratory Accreditation Subtotal 

4. Manufacturer Notification 

Third Party Certifier Number3 1.00 $0.00 $2.25 Withdraw from Program or Lose Accreditation3 0.25 $0.00 $0.56 Manufacturer Notification Subtotal 

5. Recordkeeping 

List of Manufacturers and their Product Types (including Resins Used) Certified by TPC5 1.00 $19.24 $84.47 Results of Inspections, Audits, and Emission Tests Conducted for Each Manufacturer and Product Type5 1.00 $19.24 $84.47 List of the TPC's Laboratories, Test Methods (including Test Conditions and Conditioning Time), and Test Results5 1.00 $19.24 $84.47 Methods and Results for Establishing Test Method Correlations and Equivalence5 1.00 $19.24 $84.47 List of Manufacturers and Products Approved for Reduced Testing5 1.00 $19.24 $84.47 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

March 20, 2012 Economic Analysis for the TSCA Title VI Proposed Rule B-9 

Table B-4: Recordkeeping and Reporting Labor Costs for Third Party Certifiers, by Activity (2010$) 

Activity Estimated Annual Frequency1 Clerical Cost2 Technical Cost2 Manageria

Recordkeeping Subtotal 

6. Annual Report to Accreditation Bodies 

List of Manufacturers and their Products Certified by the TPC during the Previous Year (including Resins Used, and the Average and Range of Formaldehyde Emissions by Manufacturer, Resin, and Product Type)6

1.00 $6.41 $28.16 

List of Noncomplying Products or Events by Manufacturer6 1.00 $6.41 $28.16 List of Laboratories and Test Methods Used by the TPC6 1.00 $6.41 $28.16 Results of Inter-Laboratory Comparison or Proficiency Testing for the Laboratories Used by the TPC6 1.00 $6.41 $28.16 Annual Report to AB Subtotal 

7. Accreditation Board Notification 

Personnel Qualification Changes3 0.50 $0.00 $1.13 Procedure Changes3 0.50 $0.00 $1.13 Laboratory Changes3 0.50 $0.00 $1.13 Accreditation Board Notification Subtotal 

8. EPA Notification 

Change in Name or Address of Domestic Agent (Foreign TPCs Only)3 0.50 $0.00 $1.13 

Domestic Total in First Year Foreign Total in First Year Domestic Total in Non-Reapplication Year (Year 2) Foreign Total in Non-Reapplications Year (Year 2) Domestic Total in Reapplication Year (Year 3) Foreign Total in Reapplications Year (Year 3) Notes: 1. Based on best professional judgment and rule requirements. Under the proposed rule, TPCs are required to apply for re-accreditation every two years. As a re

accreditation costs are incurred every other year. 2. Based on Employer Costs for Employee Compensation wage and benefit data for private professional and business 2011a). Clerical costs are estimated using data from the "office and administrative support" occupational group; technical costs are estimated using data from the "profe

occupational group; and managerial costs are estimated using data from the "management, business, and financial" occupational group. 3. Based on the estimated burde

"company information" (EPA 2011a). 4. Based on the estimated burden associated with answering substantiation questions when making plant site confidentiality clai

5. Based on the estimated burden associated with "recordkeeping" (EPA 2011a). The rule requires that records be kept for 5 years that show the production volume, pla

of each reported substance. 6. Estimated as one-third of the burden associated with "recordkeeping" (EPA 2011a). Estimate based on best professional judgment. 

Sources: (1) U.S. Bureau of Labor Statistics. 2011. Employer Costs for Employee Compensation: Supplementary Tables: Historical Data: December 2006 - March 201Protection Agency. 2011. Supporting Statement for a Request for OMB Review under the Paperwork Reduction Act: the Final Rule Addendum to Partial Update of the 

Inventory Data Base, Production and Site Reports 1096