National Volatile Organic Compound

Emission Standards for Architectural

Coatings -- Background for 

Promulgated Standards 

EPA

Air

United States

Environmental Protection

Agency

Office of Air Quality

Planning and Standards

Research Triangle Park NC 27711

EPA-453/R-98-006b

August 1998
EPA-453/R-98-006b

National Volatile Organic Compound

Emission Standards for Architectural Coatings

Background for Promulgated Standards

(Architectural Coating Background Information Document)

U.S. Environmental Protection Agency

Office of Air and Radiation

Office of Air Quality Planning and Standards

Research Triangle Park, North Carolina 27711

August 1998
ii

Disclaimer

This report has been reviewed by the Emission Standards Division

of the Office of Air Quality Planning and Standards,

U.S. Environmental Protection Agency, and approved for

publication. Mention of trade names or commercial products is

not intended to constitute endorsement or recommendation for use. 

Copies of this report are available through the Library Services

Offices (MD-35), U.S. Environmental Protection Agency, Research

Triangle Park, N.C. 27711, (919)541-2777, from National

Technical Information Services, 5285 Port Royal Road,

Springfield, Virginia 22161, (703)487-4650, or from the Internet

(http://www.epa.gov/ttn/).
iii

TABLE OF CONTENTS

Section Page

1.0 INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . 1-1

1.1 SUMMARY OF CHANGES SINCE PROPOSAL . . . . . . . . . 1-1

1.1.1 Applicability and compliance dates . . . . 1-1

1.1.2 Definitions . . . . . . . . . . . . . . . . 1-1

1.1.3 VOC Content Limits . . . . . . . . . . . . 1-4

1.1.4 Overlap Concerns . . . . . . . . . . . . . 1-4

1.1.5 Container labeling requirements . . . . . . 1-5

1.1.6 Variances provision . . . . . . . . . . . . 1-6

1.1.7 Tonnage Exemption . . . . . . . . . . . . . 1-6

1.1.8 Exceedance Fee Option . . . . . . . . . . . 1-6

1.1.9 Recordkeeping and Reporting . . . . . . . . 1-6

1.1.10 Compliance Provisions . . . . . . . . . . . 1-6

1.1.11 Reorganization of Rule Text . . . . . . . . 1-7

2.0 SUMMARY OF PUBLIC COMMENTS AND RESPONSES . . . . . . . . 2-1

2.1 METHOD OF REGULATION .............. 2-37

2.1.1 Section 183(e) Requirements ....... 2-37

2.1.2 National Rule Versus Other Strategies . . 2-39

2.1.3 Miscellaneous .............. 2-53

2.2 PROPOSED STANDARDS ............... 2-55

2.2.1 Applicability of the Standards ..... 2-55

2.2.1.1 General ............ 2-55

2.2.1.2 Low-Volume Exemption ..... 2-80

2.2.1.3 Small Container Exemption . . . 2-88

2.2.2 Processors as Regulated Entities .... 2-90

2.2.3 Definitions ............... 2-94

2.2.3.1 General ............ 2-94

2.2.3.2 Pigmented ........... 2-95

2.2.3.3 Lacquers ........... 2-95

2.2.3.4 Quick-dry Enamel ....... 2-97

2.2.3.5 Traffic Marking Coating . . . 2-98

2.2.3.6 Sealer ............ 2-99

2.2.3.7 Industrial Maintenance 

Coatings ........... 2-99

2.2.3.8 High Temperature Coating . . . 2-103

2.2.3.9 Extreme High Durability 

Coating ............ 2-103

2.2.3.10 Swimming Pool Coatings .... 2-104

2.2.3.11 Reformulation ........ 2-104

2.2.3.12 Shellac ........... 2-105

2.2.3.13 Flow Coating ......... 2-107

2.2.3.14 Overlap Issues ........ 2-108

2.2.4 Coating Categories and VOC Content 

Limits ................. 2-124

2.2.4.1 General ........... 2-125

2.2.4.2 Requests for New Categories . 2-143

2.2.4.3 Proposed Categories ...... 2-192
TABLE OF CONTENTS (CONTINUED)

Section Page

iv

2.2.4.4 Recycled Coatings ...... 2-242

2.2.5 Compliance Time Requirements ...... 2-244

2.2.5.1 General ............ 2-244

2.2.5.2 Small Business Compliance Time 

Extension .......... 2-252

2.2.6 Labeling, Recordkeeping and Reporting . . 2-256

2.2.6.1 Labeling ........... 2-256

2.2.6.2 Recordkeeping and Reporting . 2-268

2.2.7 Determination of Volatile Organic 

Compound Content ............ 2-272

2.2.8 Variance Provisions ........... 2-279

2.2.9 Clarifications ............. 2-286

2.3 IMPACTS ..................... 2-289

2.3.1 Environmental and Energy ........ 2-289

2.3.1.1 HAP Implications ....... 2-289

2.3.1.2 Emission Reduction Estimate . . 2-290

2.3.1.3 Wastewater/Solid Waste 

Impacts ............ 2-302

2.3.1.4 Energy Impacts ........ 2-304

2.3.2 Cost/Economic .............. 2-304

2.3.2.1 Reformulation Cost Estimate . . 2-304

2.3.2.2 Annual Cost to Industry .... 2-320

2.3.2.3 Costs not Considered ..... 2-338

2.3.2.4 Cost-effectiveness ...... 2-342

2.3.2.5 Disproportionate Impacts on 

Small Businesses ....... 2-347

2.3.2.6 Effect of Rule on Competition . 2-360

2.3.2.7 Economic Hardship ....... 2-367

2.3.2.8 Small Business Administration . 2-372

2.3.2.9 Definition of “Small Business” 2-373

2.3.2.10 Cost-Benefit Perspective . . . 2-375

2.3.2.11 Executive Order 12866, Small 

Business Regulatory Enforcement

Fairness Act,Unfunded Mandates 

Reform Act .......... 2-376

2.3.2.12 Adverse Socioeconomic and 

Related Impacts. ....... 2-378

2.4 EXCEEDANCE FEE ................. 2-381

2.4.1 Exceedance Fee Concept ......... 2-381

2.4.2 Exceedance Fee Levels .......... 2-389

2.4.3 Use of Collected Exceedance Fees .... 2-394

2.4.4 Exceedance Fee Recordkeeping and 

Reporting ................ 2-395

2.5 REGULATORY NEGOTIATION ............ 2-396

2.5.1 Section 183(e) Requirements and the 

Architectural Coatings Regulatory 

Negotiations .............. 2-396
TABLE OF CONTENTS (CONTINUED)

Section Page

v

2.5.2 Regulatory Negotiations Committee Was 

Not Properly Constituted ........ 2-400

2.5.3 Regulatory Negotiations Procedure .... 2-405

2.5.4 Miscellaneous .............. 2-409

2.6 FUTURE STUDY .................. 2-411

2.7 LEGAL ISSUES .................. 2-420

2.7.1 Publication requirements of the Clean 

Air Act and the Administrative 

Procedure Act .............. 2-420

2.7.2 Compliance With the Regulatory Flexibility 

Act (RFA) and the Small Business 

Regulatory Enforcement Fairness Act 

(SBREFA) ................ 2-423

2.7.3 Unfunded Mandate Reform Act (UMRA) . . . 2-430

2.7.4 Environmental Justice .......... 2-432

2.7.5 Executive Order 12866 .......... 2-434

2.7.6 The U.S. Constitution .......... 2-436

2.7.6.1 Interstate Commerce Clause . . 2-436

2.7.6.2 Coating Manufacturers' First

Amendment Rights (Freedom of 

Speech, Association) ..... 2-438

2.7.6.3 Taking Under the Fifth 

Amendment ........... 2-444

2.7.6.4 The Tenth Amendment 

(Delegation Powers) ...... 2-450

2.8 OUTREACH .................... 2-452
vi

LIST OF TABLES

Table Page

2-1 LIST OF COMMENTERS ON THE PROPOSED NATIONAL ARCHITECTURAL

COATINGS RULE . . . . . . . . . . . . . . . . . . . . . 2-2

2-2 CONCRETE CURING AND SEALING DATA ........... 2-128
1-1

1.0 INTRODUCTION

1.1 SUMMARY OF CHANGES SINCE PROPOSAL

Several changes have been made to the proposed rule as a

result of public comments. The significant changes to the

proposed rule are presented in this section. All of the changes

made to the proposed rule and the rationale for these changes are

discussed more fully in responses to comments in chapter 2 of

this document.

1.1.1 Applicability and compliance dates

The compliance date for manufacturers and importers of

architectural coatings, except coatings registered under the

Federal Insecticide, Fungicide and Rodenticide Act (FIFRA)

(7 USC 136 et seq.) has been extended to 12 months after the date

the final rule is published in the Federal Register. The

compliance date for coatings registered under FIFRA is 18 months

after publication of the final rule.

1.1.2 Definitions

Several changes have been made in the definitions section: 

1. Definitions for the following seven new coating

categories have been added: calcimine recoaters,

concrete curing and sealing compounds, concrete surface

retarders, conversion varnishes, faux finishing, stain

controllers, and zone markings. These categories are

defined in section 2.2.4.2 of this document. 

2. A sentence has been added to the definition of lacquer

to clarify that lacquer stains must meet the volatile

organic compound (VOC) content limit for stains rather

than lacquers. Also, a definition for stains,

including lacquer stains, has been added.

3. The term “community-based paint exchange” in the

definitions section of the rule has been changed to
1-2

“paint exchange” to include other paint exchanges

besides community-based ones, and the definition has

been amended to exclude architectural coating

manufacturers and importers.

4. The definition of “industrial maintenance coating” has

been revised to reflect that the use of such a coating

is intended for extreme environmental conditions in an

industrial, commercial, or institutional setting.

5. In the definition of “shellac”, nitrocellulose has been

excluded because of overlap with lacquers (the lacquer

definition in the rule includes cellulosic or synthetic

resins).

6. The definition of “extreme high durability coatings”

has been expanded to include in this category lower VOC

coatings, in addition to fluoropolymer-based coatings,

that also meet the weathering requirements of the

American Architectural Manufacturer’s Association

(AAMA) Specification 605.2.

7. The definition of “pigmented” has been expanded to

include the following properties of pigments: color,

corrosion inhibition, conductivity, fouling resistance,

opacity, and improved mechanical properties.

8. The minimum temperature requirement in the definition

of “high temperature coating” has been lowered to

400 degrees F. to be consistent with industry practice

and existing State architectural coating rules.

9. The definition of “anti-graffiti coating” has been

amended to remove the phrase “specifically labeled as

an anti-graffiti coating” to be consistent with

labeling requirements for other coating categories.

10. A definition of “shop application” has been added to

clarify that coatings applied in a shop setting or

during a manufacturing process are not subject to the

rule. 

11. The definition of “coating” has been amended to remove

reference to application as a film because the EPA did

not intend to limit rule applicability based upon the

product thickness as applied. Also, a sentence has

been added to further clarify what coatings are

regulated. The revised definition follows: “Coating

means a material applied onto or impregnated into a

substrate for protective, decorative or functional

purposes. Such materials include, but are not limited

to, paints, varnishes, sealants, inks, maskants, and

temporary coatings. Protective, decorative or
1-3

functional materials that consist only of solvents,

acids, bases, or any combination of these substances

are not considered coatings for the purpose of this

subpart.”

12. The definition of “architectural coating” has been

amended to exclude adhesives, coatings recommended

solely for shop application, and coatings recommended

solely for application to non-stationary structures,

such as airplanes, ships, boats and railcars because

they were not intended to be covered. Also,

definitions of “adhesive” and “shop application” have

been added to the rule for further clarification.

13. A definition of “United States” has been added to

clarify that the rule applies to the 50 States, the

District of Columbia, and United States territories.

14. The definitions of “importer” and “manufacturer” have

been amended to clarify that any person who repackages

a coating by transferring it from one container to

another is excluded from these definitions, provided

the coating VOC content is not altered and the coating

is not sold or distributed to another party. Also, a

sentence has been added in these definitions for

further clarification of applicability and a definition

of "person" has been added to clarify its use in these

definitions.

15. Definitions of “imported” and “manufactured” have been

added to clarify the point at which an architectural

coating becomes subject to the requirements in the

rule.

16. The definition of “graphic arts coating” has been

revised to delete the reference to “in shop” since shop

applications are not regulated under this rule.

17. In the definition of “floor coating”, the word “opaque”

has been added to further define these coatings, and a

definition of “opaque” has been added to the rule. In

addition, the words “in a residential setting” have

been added to distinguish coatings meant to be subject

to the 400 g/l limit for floor coatings from those

floor coatings intended for use in an industrial,

institutional, or commercial setting, which would be

subject to the 450 g/l limit for industrial maintenance

coatings.

18. Although there were no comments on the definition of

"sale" in the Definitions section of the proposed rule,

the Agency deleted this term because it was

unnecessary.
1-4

1.1.3 VOC Content Limits

Seven additional categories and associated VOC content

limits have been established for the following coatings:

(1) calcimine recoaters at 475 g/l; (2) concrete surface

retarders at 780 g/l; (3) concrete curing and sealing compounds

at 700 g/l; (4) conversion varnishes at 725 g/l; (5) faux

finishing/glazing at 700 g/l; (6) zone markings at 450 g/l; and

(7) stain controllers at 720 g/l. In addition, the VOC content

limits for some of the proposed coating categories have been

revised as follows: (1) antifouling from 400 g/l to 450 g/l; (2)

nuclear from 420 g/l to 450 g/l; (3) clear shellacs from 650 g/l

to 730 g/l; and (4) combined opaque and clear waterproofing

sealers and treatments at 600 g/l (opaque was proposed at

400 g/l).

1.1.4 Overlap Concerns

Several changes have been made to address some commenters’

concerns that a coating that is developed and designated for a

particular use by definition could be subject to a more

restrictive limit if the coating is suitable for use in another

category with a lower limit. In order to address these overlap

concerns, paragraphs (b) and (c)(1)-(c)(7)of § 59.402 have been

amended, and new paragraphs (c)(8)-(c)(15) have been added to

§ 59.402. The new provisions in paragraphs (c)(8)-(c)(15)

address overlap concerns in the following categories:

1. Varnishes and conversion varnishes that are recommended

for use as floor coatings are only subject to the VOC

content limit for varnishes and conversion varnishes,

respectively.

2. Anti-graffiti coatings, high temperature coatings,

impacted immersion coatings, thermoplastic rubber

coatings and mastics, repair and maintenance

thermoplastic coatings, and flow coatings that also

meet the definition for industrial maintenance coatings

are only subject to the VOC content limit for that

particular category (i.e., not subject to the

industrial maintenance coating VOC content limit).

3. Waterproofing sealers and treatments that also meet the

definition for quick-dry sealers are only subject to
1-5

the VOC content limit for waterproofing sealers and

treatments.

4. Sanding sealers that also meet the definition for

quick-dry sealers are only subject to the VOC content

limit for sanding sealers.

5. Nonferrous ornamental metal lacquers and surface

protectants that also meet the definition for lacquers

are only subject to the VOC content limit for

nonferrous ornamental metal lacquers and surface

protectants.

6. Quick-dry primers, sealers, and undercoaters that also

meet the definition for primers and undercoaters are

only subject to the VOC content limit for quick-dry

primers, sealers, and undercoaters.

7. Antenna coatings that also meet the definition for

industrial maintenance coatings or primers are only

subject to the VOC content limit for antenna coatings. 

8. Bituminous coatings and mastics that are recommended

for use as any other architectural coating are subject

only to the limit for bituminous coatings and mastics.

1.1.5 Container labeling requirements

1. The proposed labeling requirements were amended to

clarify that to meet the labeling requirements for

containers of architectural coatings, manufacturers and

importers are allowed to use either (1) the VOC content

limit for the category with which the product is

required to comply and with which it does comply, or

(2) the VOC content of the coating. In other words,

the manufacturer or importer is not required to provide

the actual VOC content of the coating. The labeled VOC

content must account for the manufacturer’s or

importer’s thinning recommendation.

2. The proposed requirement for industrial maintenance

coatings to be labeled “not for residential use” has

been modified to allow flexibility in the wording of

the labeling statement.

3. The labeling section of the proposed rule has been

modified to allow the date of manufacture or date code

to appear on either the container lid, label, or bottom

of the can.
1-6

1.1.6 Variances provision

The variances provision in the proposed rule was not

included in the final rule. The rationale for this change is

discussed in section 2.2.8 of this document.

1.1.7 Tonnage Exemption

A VOC tonnage exemption has been included in the final rule,

based upon the proposed low-volume exemption. Under this

provision, each manufacturer can exempt a total of 23 megagrams

(25 tons) of VOC emissions in the time period from the compliance

date to December 31, 2000; 18 megagrams (20 tons) in the year

2001; and 9 megagrams (10 tons) in the year 2002 and in each year

beyond. The tonnage exemption is discussed in section 2.2.1.2 of

this document. This provision is designed to accommodate the

needs of small manufacturers, niche markets, and specialty

products while effectively limiting the VOC emissions from the

exemption. This exemption is needed to help ensure the economic

feasibility of the rule.

1.1.8 Exceedance Fee Option

Provisions for an exceedance fee option have been included

in the final rule. Under this approach, manufacturers and

importers have the option of paying a fee, based on the amount

that their coatings exceed the applicable VOC content limits,

instead of achieving the VOC content limits listed in the rule. 

This allows manufacturers and importers to continue to market

non-compliant coatings while they develop compliant or new

coatings. This provision is a market-based incentive to

encourage manufacturers and importers to develop compliant

coatings while at the same time recognizing that for some

manufacturers of some coatings, additional time is needed.

1.1.9 Recordkeeping and Reporting

Recordkeeping and reporting requirements have been included

for manufacturers and importers using the tonnage exemption and

exceedance fee option.

1.1.10 Compliance Provisions

A new section has been included in the rule to consolidate

the proposed rule’s provisions for determining compliance. 
1-7

Language has been added to clarify the requirements that were

proposed regarding determination of VOC content.

1.1.11 Reorganization of Rule Text

The rule text has been reorganized for clarity and ease of

understanding. 
2-1

2.0 SUMMARY OF PUBLIC COMMENTS AND RESPONSES

The U.S. Environmental Protection Agency (EPA) received a

total of 243 letters commenting on the proposed standards and the

background information document (BID) for the proposed standards. 

The EPA held a public hearing on July 30, 1996 in Durham, North

Carolina, at which 19 commenters presented oral comments. In

addition, the EPA held a public meeting on August 13, 1996 in

Rosemont, Illinois, in which 77 persons participated. At this

public meeting, 18 manufacturers provided company profiles. Some

commenters provided more than one comment letter or commented at

the public hearing or meeting. Each letter or comment has a

separate comment number. Comments are designated as follows:

& IV-D-(number) written comment received during comment

period

& IV-F-1(letter) comment received at public hearing

& IV-F-2(letter) comment received at public meeting

& IV-G-(number) comment received after comment period

In this promulgation BID, commenters with multiple comment

letters or statements at the hearing or meeting are identified

with a slash between comments. For example, if a commenter

provided written comments and public hearing comments, the

commenter is identified as (IV-D-number/IV-F-1 letter). Copies

of comment letters, meeting transcripts, and telecons are located

in docket A-92-18. The docket is available for public inspection

between 8:00 a.m. and 5:30 p.m., Monday through Friday, at the

EPA’s Air and Radiation Docket and Information Center (Mail

Code 6102), 401 M Street S.W., Washington, DC 20460, or by

calling (202) 260-7548. A list of the commenters, their
2-2

affiliations, and the EPA docket number assigned to their

correspondence is given in table 2-1.

The comments and responses, and therefore the organization

of this document, have been categorized under the following

topics:

& Method of Regulation;

& Proposed Standards;

& Impacts;

& Exceedance Fee;

& Regulatory Negotiations;

& Future Study;

& Legal Issues; and

& Outreach.

This document contains summaries and responses to comments

mainly covering the provisions of the proposed architectural

coatings rule. To avoid duplication, most comments that pertain

to the EPA’s study, Report to Congress, and schedule for

regulations under section 183(e) are discussed in a separate

comment/response document, Response to Comments on Section 183(e)

Study and Report to Congress referred to as the 183-BID.
2-3

TABLE 2-1. LIST OF COMMENTERS ON THE PROPOSED NATIONAL 

ARCHITECTURAL COATINGS RULE

Docket Number Commenter and affiliation

IV-D-01 Mr. James E. Thomas, Jr.

CEO

Jetco, Inc.

Post Office Box 11494

Memphis, Tennessee 38111

IV-D-02 Mr. Ned B. Kisner

President

Triangle Coatings, Inc.

1930 Fairway Drive

San Leandro, California 94577

IV-D-03 Mr. Kisuk Cheung

Chief, Engineering Division

Department of the Army

U.S. Army Corps of Engineers

Washington, DC 20314-1000

IV-D-04 Mr. Benard R. Appleman

Executive Director

Steel Structures Painting Council

40 24th Street, 6th Floor

Pittsburgh, Pennsylvania 15222-4643

IV-D-05 Mr. William A. Rostine

President

Rostine Manufacturing and Supply, Inc.

Post Office Box 8192

4227C W. Church

Springfield, Missouri 65801

IV-D-06 Mr. Ronald B. Child

Vice President of Compliance & Reg. Affairs

California Products Corporation

Post Office Box 390569

Cambridge, Massachusetts 02139-0007

IV-D-07 F.H. McGary

Vice President Manufacturing

Star Bronze Company, Inc.

Post Office Box 2206

Alliance, Ohio 44601-0206

IV-D-08 Mr. Richard Hardy

President

XIM Products, Inc. 

1169 Bassett Road

Westlake, Ohio 44145
TABLE 2-1. LIST OF COMMENTERS ON THE PROPOSED NATIONAL 

ARCHITECTURAL COATINGS RULE (CONTINUED)

Docket Number Commenter and affiliation

2-4

IV-D-09 Mr. Jim Gardner

President

Trinity Coatings Company

Post Office Box 2488

Fort Worth, Texas 76113-2488

IV-D-10 Mr. James S. Jennison

President

Jennison Industries

106 Washington

Post Office Box 965

Burlington, Iowa 52601

IV-D-11 Mr. Robert E. Mitchell

Chairman of the Board

Dunn-Edwards Corporation

4885 East 52nd Place

Los Angeles, California 90040

IV-D-12 Ms. Susan J. Binder

Division Administrator

Federal Highway Administration

U.S. Department of Transportation

State Highway Administration, 

 Maryland Division

711 West 40th Street, Suite 220

Baltimore, Maryland 21211-2187

IV-D-13 Mr. Robert C. Maindelle

Environmental Specialist

Wilsonart International, Inc.

Post Office Box 6110

Temple, Texas 76503-6110

IV-D-14 Mr. Robert E. Mitchell

Chairman of the Board

Dunn-Edwards Corporation

4885 East 52nd Place

Los Angeles, California 90040

IV-D-15 duplicate of Item IV-D-8, removed from

docket.

IV-D-16 Mr. James S. Jennison

President

Jennison Industries

Post Office Box 965

Burlington, Iowa 52601
TABLE 2-1. LIST OF COMMENTERS ON THE PROPOSED NATIONAL 

ARCHITECTURAL COATINGS RULE (CONTINUED)

Docket Number Commenter and affiliation

2-5

IV-D-17 Mr. Gene Bartlow

President and CEO

American Wood Preservers Institute

1945 Old Gallows Road, Suite 150

Vienna, Virginia 22182-3931

IV-D-18 Mr. John F. Montle

Vice President-Technology

Carboline Company

350 Hanley Industrial Court

St. Louis, Missouri 63144

IV-D-19 Mr. Benard R. Appleman

Executive Director

Steel Structures Painting Council

40 24th Street, 6th Floor

Pittsburgh, Pennsylvania 15222-4643

IV-D-20 Mr. Ben Gavett

Director of Safety & Compliance

Golden Artist Colors, Inc.

188 Bell Road

New Berlin, New York 13411

IV-D-21 Mr. David Schmetterer

Vice President

Crawford Laboratories

4165 South Emerald Avenue

Chicago, Illinois 60609

IV-D-22 Mr. S. William Becker

Executive Director

STAPPA/ ALAPCO

444 North Capitol Street, N.W.

Washington, DC 20001

IV-D-23 Ms. Linda M. Loreth

Environmental, Health, and Safety Manager

A.W. Chesterton Company

Post Office Box 9101

Stoneham, Massachusetts 02180-9101

IV-D-24 Mr. Christopher L. Runyan

Assistant Director of Transportation Policy

Ohio Department of Transportation

Central Office

Post Office Box 899

Columbus, Ohio 43216-0899
TABLE 2-1. LIST OF COMMENTERS ON THE PROPOSED NATIONAL 

ARCHITECTURAL COATINGS RULE (CONTINUED)

Docket Number Commenter and affiliation

2-6

IV-D-25 Mr. Robert Senior

Wm. Zinsser & Company, Inc.

39 Belmont Drive

Somerset, New Jersey 08875-1285

IV-D-26 Mr. Alaistair MacDonald

CEO

Specialty Coatings & Chemicals, Inc.

7360 Varna Avenue

North Hollywood, California 91605

IV-D-27 Mr. T. Leon Everett

President & CEO

Dan-Tex Paint & Coating Manufacturing

Company, Inc.

444 Aston Drive

Sunnyvale, Texas 75182

IV-D-28 Mr. Karl R. Schultz

Environmental Consultant

DuPont Automotive Products

Wilmington, Delaware 19898

IV-D-29 Mr. Ned B. Kisner

Triangle Coatings, Inc.

1930 Fairway Drive

San Leandro, California 94577

IV-D-30 Mr. James G. Stilling

Vice President and General Manager

W.R. Meadows, Inc.

Post Office Box 543

Elgin, Illinois 60121

IV-D-31 Mr. David P. Straub

Executive Director

Metal Maintenance Industry Association, Inc.

352 Seventh Avenue

New York, New York 10001

IV-D-32 Mr. Gregory A. Green

Administrator

Air Quality Division

Oregon Department of Environmental Quality

811 S.W. Sixth Avenue

Portland, Oregon 97204-1390
TABLE 2-1. LIST OF COMMENTERS ON THE PROPOSED NATIONAL 

ARCHITECTURAL COATINGS RULE (CONTINUED)

Docket Number Commenter and affiliation

2-7

IV-D-33 Ms. Barbara A. Kwetz

Director

Division of Air Quality Control

Commonwealth of Massachusetts

Department of Environmental Protection

One Winter Street

Boston, Massachusetts 02108

IV-D-34 Mr. James M. Lents

Executive Officer

South Coast Air Quality Management District 

21865 E. Copley Drive

Diamond Bar, California 91765-4182

IV-D-35 Ms. Linda M. Loreth

Environmental, Health and Safety Manager

A.W. Chesterton Company

225 Fallon Road

Post Office Box 9101

Stoneham, Massachusetts 02180-9101

IV-D-36 Ms. Pamela S. Clark

Preservo Paint Manufacturing

2401 Broiller

Post Office Box 20125

Houston, Texas 77225

IV-D-37 Mr. Daniel L. Stein and V.B. Winge

3M Traffic Control Materials Division

3M Center Building 582-1-15

St. Paul, Minnesota 55144-1000

IV-D-38 Mr. Jimmy D. Adams

American Coatings, Inc.

Post Office Box 1426

Tomball, Texas 77377-1426

IV-D-39 Anonymous 

IV-D-40 Mr. Darryl E. Durgin

Deputy Commissioner

Minnesota Department of Transportation

Office of Traffic Engineering

Mail Stop 725

1500 West County Road B2, Suite 250

Roseville, Minneapolis 55113
TABLE 2-1. LIST OF COMMENTERS ON THE PROPOSED NATIONAL 

ARCHITECTURAL COATINGS RULE (CONTINUED)

Docket Number Commenter and affiliation

2-8

IV-D-41 Mr. Don Diller

Director

Wyoming Department of Transportation

Post Office Box 1708

Cheyenne, Wyoming 82003-1708

IV-D-42 Mr. Robert Senior

Wm. Zinsser & Company, Inc.

173 Belmont Drive

Somerset, New Jersey 08875-1285

IV-D-43 Mr. Robert Senior

Wm. Zinsser & Company, Inc.

173 Belmont Drive

Somerset, New Jersey 08875-1285

IV-D-44 Mr. J. Anthony Ward, III

Sales Representative

Farrell-Calhoun Paint

221 E. Carolina Avenue

Memphis, Tennessee 38126

IV-D-45 Mr. Richard B. Cunningham

President

Passonno Paints

500 Broadway

Watervliet (Albany), New York 12189

IV-D-46 Mr. Roy Krill

Technical Director

Masterchem Industries, Inc.

Post Office Box 368

Barnhart, Missouri 63012-0368

IV-D-47 Mr. Ron Sorenson

President

Hardwood Flooring Distributors, Inc.

1024 6th Avenue South

Seattle, Washington 98134

IV-D-48 Mr. Vic Fazio and Gary Condit

Members of Congress

United States House of Representatives

2442 Rayburn Building

Washington, DC 20515-0503
TABLE 2-1. LIST OF COMMENTERS ON THE PROPOSED NATIONAL 

ARCHITECTURAL COATINGS RULE (CONTINUED)

Docket Number Commenter and affiliation

2-9

IV-D-49 Mr. Edward D. Edwards

Owner

Dunn-Edwards Corporation

4885 East 52nd Place

Los Angeles, California 90040

IV-D-50 Mr. Robert E. Mitchell

Chairman of the Board

Dunn-Edwards Corporation

4885 East 52nd Place

Los Angeles, California 90040

IV-D-51 Mr. Richard B. Cunningham

President

Passonno Paints

500 Broadway

Watervliet, NY 12189

IV-D-52 Mr. William M. Smiland 

Law Offices Smiland & Khachigian

Seventh Floor

601 West Fifth Street

Los Angeles, California 90071

IV-D-53 Mr. Peter Lilholt 

Commissioner of Public Works

Sullivan County Department Of Public Works

Post Office Box 5012

Monticello, New York 12701-5192

IV-D-54 Mr. Jim Talent

Member of Congress

United States House of Representatives

2442 Rayburn Building

Washington, DC 20515-2502

IV-D-55 Mr. Robert E. Mitchell

Chairman of the Board

Dunn-Edwards Corporation

4885 East 52nd Place

Los Angeles, California 90040

IV-D-56 Mr. Matthew G. Martinez, Michael Bilirakis,

Julian C. Dixon, and Lucille Roybal-Allard

United States House of Representatives

2442 Rayburn Building

Washington, DC 20515
TABLE 2-1. LIST OF COMMENTERS ON THE PROPOSED NATIONAL 

ARCHITECTURAL COATINGS RULE (CONTINUED)

Docket Number Commenter and affiliation

2-10

IV-D-57 C.W. Glover

Chief Counsel for Advocacy

U.S. Small Business Administration

Office of Advocacy

Washington, DC 20416

IV-D-58 Mr. J. Andrew Doyle

President

National Paint & Coatings Association

1500 Rhode Island Avenue, N.W.

Washington, DC 20005-5597

IV-D-59 Ms. Georgette Sturam

Gensler

One Rockefeller Plaza, Suite 500

New York, New York 10020

IV-D-60 Mr. John Lahey

President

Fine Paints of Europe

Post Office Box 419

Woodstock, Vermont 05091-0419

IV-D-61 Mr. Howard Berman

Senior Vice President

The Jefferson Group, Inc.

1341 G Street, N.W., Suite 1100

Washington, DC 20005

IV-D-62 Mr. William M. Smiland

Law Offices of Smiland & Khachigian

Seventh Floor

601 West Fifth Street

Los Angeles, California 90071

IV-D-63 Mr. Mel Turner

President

Standard Paints, Inc.

1107 West Commerce Street

Dallas, Texas 75208

IV-D-64 Mr. Greg N. Manns

Project Director

Industry Insights, Inc.

1585 Bethel Road

Columbus, Ohio 43220
TABLE 2-1. LIST OF COMMENTERS ON THE PROPOSED NATIONAL 

ARCHITECTURAL COATINGS RULE (CONTINUED)

Docket Number Commenter and affiliation

2-11

IV-D-65 Mr. Kevin Bromberg

U.S. Small Business Administration

Office of Advocacy

Washington, DC 20416

IV-D-66 Mr. Robert E. Mitchell

Chairman of the Board

Dunn-Edwards Corporation

4885 East 52nd Place

Los Angeles, California 90040

IV-D-67 Mr. Howard Berman

Senior Vice President

The Jefferson Group, Inc.

1341 G Street, N.W., Suite 1100

Washington, DC 20005

IV-D-68 Mr. Derrick Singleton

Environmental Engineer

Fosroc, Inc.

150 Carley Court

Georgetown, Kentucky 40324

IV-D-69 F.H. McGary

Vice President-Manufacturing

Star Bronze Company, Inc.

Post Office Box 2206

Alliance, Ohio 44601-0206

IV-D-70 Mr. Robert E. Mitchell

Chairman of the Board

Dunn-Edwards Corporation

4885 East 52nd Place

Los Angeles, California 90040

IV-D-71 Mr. David Nordberg

Consumer & Commercial Products Specialist

Oregon Department of Environmental Quality

2020 S.W. Fourth Avenue, Suite 400

Portland, Oregon 97201-4987

IV-D-72 Mr. Richard B. Cunningham

President

Passonno Paints

500 Broadway

Watervliet, NY 12189
TABLE 2-1. LIST OF COMMENTERS ON THE PROPOSED NATIONAL 

ARCHITECTURAL COATINGS RULE (CONTINUED)

Docket Number Commenter and affiliation

2-12

IV-D-73 Mr. Richard B. Cunningham

President

Passonno Paints

500 Broadway

Watervliet, NY 12189

IV-D-74 Joseph Fogel

The Garland Company

3800 East 91st Street

Cleveland, Ohio 44105-2197

IV-D-75 Mr. Philip Lader

Administrator

U.S. Small Business Administration

Office of the Administrator

Washington, DC 20416

IV-D-76 Mr. James G. Ross

Regulatory Affairs Director

Hillyard Industries, Inc.

Post Office Box 909

St. Joseph, Missouri 64502-9964

IV-D-77 Mr. Ned B. Kisner

Triangle Coatings, Inc.

1930 Fairway Drive

San Leandro, California 94577

IV-D-78 duplicate item, removed from docket

IV-D-79 Mr. Dan Pearson

Executive Director

Texas Natural Resource Conservation

Commission

Post Office Box 13087

Austin, Texas 78711-3087

IV-D-80 Mr. Bruce A. Berglund

Senior Research Chemist

Wacker Silicones Corporation

3301 Sutton Road

Adrian, MI 49221-9397

IV-D-81 duplicate item, removed from docket

IV-D-82 Mr. Langely A. Spurlock

Vice President

Chemstar

1300 Wilson Boulevard

Arlington, Virginia 22209
TABLE 2-1. LIST OF COMMENTERS ON THE PROPOSED NATIONAL 

ARCHITECTURAL COATINGS RULE (CONTINUED)

Docket Number Commenter and affiliation

2-13

IV-D-83 Mr. Guy Gruenberg

Vice President

RAE Products and Chemicals Corporation

11630 South Cicero Avenue

Alsip, Illinois 60658-2599

IV-D-84 Mr. Bill Maloney

Washington Wood Floor Supply, Inc.

15509 NE 90th

Redmond, Washington 98052

IV-D-85 Mr. James G. Ross

Regulatory Affairs Director

Hillyard Industries, Inc.

Post Office Box 909

St. Joseph, Missouri 64502-9964

IV-D-86 Mr. Mark S. Horton, CSP

Regulatory Affairs Manager

Chemrex, Inc.

889 Valley Park Drive

Shakopee, Minnesota 55379

IV-D-87 Mr. Tim Vance

Vice President

Vance Brothers, Inc.

5201 Brighton

Kansas City, Missouri 64130

IV-D-88 Mr. Richard R. Blank

Managing General Partner

Broadway Properties

126 East Fifth Street

Michigan City, Indiana 46360

IV-D-89 Mr. Kurt Dayhuff

Palo Duro Hardwoods, Inc.

4800 Lima Street

Denver, Colorado 80239

IV-D-90 Lynden Henning

Owner

Henning Painting Company

R.Route 3, Box 183

Mattoon, Illinois 61938-9030
TABLE 2-1. LIST OF COMMENTERS ON THE PROPOSED NATIONAL 

ARCHITECTURAL COATINGS RULE (CONTINUED)

Docket Number Commenter and affiliation

2-14

IV-D-91 Mr. Laurence G. Starosta

President

Maintenance Unlimited, Inc.

Post Office Box 5

Palos Heights, Illinois 60463-0005

IV-D-92 Mr. David N. Titus

President

Henning Asphalt Sealing & Striping Company

R.Route 3, Box 183

Mattoon, Illinois 61938

IV-D-93 Mr. David Altena

President

RepcoLite Paints, Inc.

473 West 17th Street

Holland, Michigan 49423

IV-D-94 Mr. Craig Connor

Palo Duro Hardwoods, Inc.

4800 Lima Street

Denver, Colorado 80239

IV-D-95 Mr. Allan J. Rose

President 

Rose Paving & Sealcoating Company

408 West Taft Drive

South Holland, Illinois 60473-2028

IV-D-96 Mr. Arthur J. Fossa

Director

Division of Air Resources

New York State Department Of Environmental

Conservation

50 Wolf Road

Albany, New York 12233-3251

IV-D-97 Mr. Philip Lader

Administrator

U.S. Small Business Administration

Office of the Administrator

Washington, DC 20416

IV-D-98 Mr. Jack Schroe

Secretary/Treasurer

The Bahr Company

1308 Marquette Drive

Romeoville, Illinois 60441
TABLE 2-1. LIST OF COMMENTERS ON THE PROPOSED NATIONAL 

ARCHITECTURAL COATINGS RULE (CONTINUED)

Docket Number Commenter and affiliation

2-15

IV-D-99 Mr. Dave J. McVey

D & M Striping

6437 South Kedvale

Chicago, Illinois 60629

IV-D-100 Mr. David Bollinger

Cascade Pacific Floor Distributors, Inc.

5021 S.E. 26th Avenue

Portland, Oregon 97202

IV-D-101 Mr. Ned B. Kisner

President

Triangle Coatings, Inc.

1930 Fairway Drive

San Leandro, California 94577

IV-D-102 Mr. Patrick Smith

Smith Wood Floors, Inc.

40000 Grand River, #108

Novi, Michigan 48375

IV-D-103 Mr. Ralph Lorenz

President

Ralph’s Hardwood Floors

404 West State Street (Hwy.54)

Black Creek, Wisconsin 54106

IV-D-104 Ms. Sharilyn McMaster

2173 Mohican Place

Boise, Idaho 83709

IV-D-105 Mr. Randy Nash

President

RR Hardwood, Inc.

5125 W. Gage Street

Boise, Idaho 83706

IV-D-106 Mr. Bruce Whisenhunt

President

Palo Duro Hardwoods, Inc.

4800 Lima Street

Denver, Colorado 80239

IV-D-107 Ms. Christine Coates

Golden State Flooring Company

449 Littlefield Avenue

South San Francisco, California 94080
TABLE 2-1. LIST OF COMMENTERS ON THE PROPOSED NATIONAL 

ARCHITECTURAL COATINGS RULE (CONTINUED)

Docket Number Commenter and affiliation

2-16

IV-D-108 Mr. Peter E. Flood

President

The Flood Company

1212 Barlow Road

Post Office Box 2535

Hudson, Ohio 44236-0035

IV-D-109 Mr. Peter W. Harman

President

Harman Hardwood Flooring Company, Inc.

29 Hebard Street

Rochester, New York 14605

IV-D-110 Mr. Maxie E. Quinn

President

Dyco Paints, Inc.

5850 Ulmerton Road

Clearwater, Florida 34620-3989

IV-D-111 Ms. Lynne Schwan

Marketing Manager

Lockwood Flooring

8249 Brentwood Industrial Drive

St. Louis, Missouri 63144

IV-D-112 Mr. Mike Baseman

President

Baseman Hardwood Floors, Inc.

N2926 Jeske Road

Appleton, Wisconsin 54915

IV-D-113 Mr. Lawrence Williams

Indiana Wood Floors, Inc.

5555 Elmwood Avenue, Suite E

Indianapolis, Indiana 46203

IV-D-114 Mr. Mark E. Maxwell

Industry Manager

Building Materials Industries

Dow Corning Corporation

Midland, Michigan 48686-0995

IV-D-115 Lon R. Rogers

Director

Anchor Paint Mfg. Company

6707 East 14th

Post Office Box 1305

Tulsa, Oklahoma 74101-1305
TABLE 2-1. LIST OF COMMENTERS ON THE PROPOSED NATIONAL 

ARCHITECTURAL COATINGS RULE (CONTINUED)

Docket Number Commenter and affiliation

2-17

IV-D-116 Mr. James E. Siebels

Chief Engineer

Engineering, Design & Construction

Department of Transportation 

State of Colorado

4201 East Arkansas Avenue

Denver, Colorado 80222

IV-D-117 Ms. Susan S.G. Wierman

Executive Director

MARAMA

711 W 40th Street, Suite 318

Baltimore, Maryland 21211

IV-D-118 Mr. Bruce S. Carhart

Executive Director

Ozone Transport Commission

444 N. Capitol St. N.W., Suite 638

Washington, DC 20001

IV-D-119 Mr. Jason Grumet

Executive Director

NESCAUM

129 Portland Street

Boston, Massachusetts 02114

IV-D-120 Mr. Leo Hickman

Regulatory Affairs Manager

Fosroc, Inc.

Construction Division

150 Carley Court

Georgetown, Kentucky 40324

IV-D-121 Ms. Elsie L. Munsell

Deputy Assistant Secretary of the Navy

Environment & Safety

Department of the Navy

Office of the Assistant Secretary

1000 Navy Pentagon

Washington, DC 20350-1000

IV-D-122 Mr. Jim Sell

National Paint & Coatings Association

1500 Rhode Island Avenue, N.W.

Washington, DC 20005-5597
TABLE 2-1. LIST OF COMMENTERS ON THE PROPOSED NATIONAL 

ARCHITECTURAL COATINGS RULE (CONTINUED)

Docket Number Commenter and affiliation

2-18

IV-D-123 Mr. Donald V. Ottley

Vice President

Ottley Floor Company, Inc.

4540 South 200 West

Salt Lake City, Utah 84107

IV-D-124 Mr. Steven W. Berlin

President

Berlin Flooring, Inc.

4451 Wellington Road

Boulder, Colorado 80301

IV-D-125 Mr. Michael P. Stock

Vice President

TK Products 

Division of Sierra Corporation

11400 West 47th Street

Minnetonka, Minnesota 55343

IV-D-126 Mr. Donald F. Theiler

Director

Bureau of Air Management

State of Wisconsin

Department of Natural Resources 

Post Office Box 7921

101 South Webster Street

Madison, Wisconsin 53707-7921

IV-D-127 Mr. Fred L. Connatser

President

Maryland Wood Floors, Inc.

1244 Ritchie Hwy.

Arnold, Maryland 21012

IV-D-128 Mr. David D. Hood

President

Induron Protective Coatings

Post Office Box 2371

Birmingham, Alabama 35201-2371

IV-D-129 Mr. Dwayne M. Fuhlhage

Environmental & Safety Compliance Officer

ProSoCo, Inc.

755 Minnesota Avenue

Post Office Box 171677

Kansas City, Kansas 66117
TABLE 2-1. LIST OF COMMENTERS ON THE PROPOSED NATIONAL 

ARCHITECTURAL COATINGS RULE (CONTINUED)

Docket Number Commenter and affiliation

2-19

IV-D-130 Mr. William A. Rostine

President

Rostine Mfg. And Supply, Inc.

Post Office Box 8192

4227C W. Church

Springfield, Missouri 65801

IV-D-131 Mr. Mike Reinmiller

Palo Duro Hardwoods, Inc.

4800 Lima Street

Denver, Colorado 80239

IV-D-132 Mr. Albert Salter

Palo Duro Hardwoods, Inc.

4800 Lima Street

Denver, Colorado 80239

IV-D-133 Mr. Steve Marchetti

Palo Duro Hardwoods, Inc.

4800 Lima Street

Denver, Colorado 80239

IV-D-134 Mr. Gerald W. Lancour

Director

Occupational Safety, Health & Environmental

Affairs

McDonnell Douglas Corporation

Post Office Box 516

Saint Louis, Missouri 63166-0516

IV-D-135 Mr. Robert Shepard

Lebanon Oak Flooring Company

3110 Roosevelt Avenue

Post Office Box 18176

Indianapolis, Indiana 46218-0176

IV-D-136 Mr. Lester Markowitz

Niles Color Center, Inc.

7652 North Milwaukee

Niles, Illinois 60714

IV-D-137 Mr. Russ Hearing

General Manager

Preserva-Products, Inc.

12860 Earhart Avenue, Suite 102

Auburn, California 95602
TABLE 2-1. LIST OF COMMENTERS ON THE PROPOSED NATIONAL 

ARCHITECTURAL COATINGS RULE (CONTINUED)

Docket Number Commenter and affiliation

2-20

IV-D-138 Mr. Guy Gruenberg

Vice President

RAE Products and Chemicals Corporation

11630 South Cicero Avenue

Alsip, Illinois 60658-2599

IV-D-139 Mr. Alan J. Walters

Vice President

Fancy Colours and Company

1438 Burgandy Parkway

Streamwood, Illinois 60107

IV-D-140 Mr. Jay H. Burrill

Environmental Coordinator

Grace Construction Products

W.R. Grace & Co,-Conn.

62 Whittemore Avenue

Cambridge, Massachusetts 02140-1692

IV-D-141 CenterLine Industries, Inc.

5380 Bircher Boulevard

Post Office Box 66802

St. Louis, Missouri 63166-6803

IV-D-142 AACCO

5220 N. 125th Street

Butler, Wisconsin 53007

IV-D-143 Mr. Lee Neerhof

Sales Manager

Velvit Products Company

Division of Dynamic Development, Corporation

Post Office Box 1741

Appleton, Wisconsin 54913

IV-D-144 Erickson Decorating Products, Inc.

6040 North Pulaski Road

Chicago, Illinois 60646

IV-D-145 Ms. Janis L. Skidmore

Secretary/Treasurer

Meyer Skidmore & Company

1333 Yarmouth Avenue, Unit 2

Boulder, Colorado 80304

IV-D-146 duplicate of item IV-D-116
TABLE 2-1. LIST OF COMMENTERS ON THE PROPOSED NATIONAL 

ARCHITECTURAL COATINGS RULE (CONTINUED)

Docket Number Commenter and affiliation

2-21

IV-D-147 Mr. David L. Westerman

Vice President

Carbit Paint Company

927 W. Blackhawk Street

Chicago, Illinois 60622-2519

IV-D-148 Ms. Marylin Zaw-Mon

Director

Air and Radiation Management Administration

Maryland Department of the Environment

2500 Broening Hwy

Baltimore, Maryland 21224

IV-D-149 Mr. James J. Land

President

Pavement Systems, Inc.

3020 W. 139th Street

Blue Island, Illinois 60406

IV-D-150 Mr. Keith Vander Woude

Vice President

Perm-A-Seal, Inc.

Post Office Box 1216

South Holland, Illinois 60473

IV-D-151 Ms. Lynn P. O’Brien

Manager, Regulatory Compliance

Keeler & Long, Inc.

Post Office Box 460

Watertown, Connecticut 06795

IV-D-152 Mr. Moorman L. Scott

Vice President

The Euclid Chemical Company

19218 Redwood Road

Cleveland, Ohio 44110-2799

IV-D-153 Harrison Paint Corporation

Post Office Box 8470

Canton, Ohio 44711

IV-D-154 Mr. James K. Crawford

General Manager

EDOCO

22039 South Westward Avenue

Long Beach, California 90810-1681
TABLE 2-1. LIST OF COMMENTERS ON THE PROPOSED NATIONAL 

ARCHITECTURAL COATINGS RULE (CONTINUED)

Docket Number Commenter and affiliation

2-22

IV-D-155 Mr. Robert E. Mitchell

Chairman of the Board

Dunn-Edwards Corporation

4885 East 52nd Place

Los Angeles, California 90040

IV-D-156 Mr. Christopher G. Foster

Smiland & Khachigian

Seventh Floor

601 West Fifth Street

Los Angeles, California 90071

IV-D-157 Ms. Lesa K. McDonald

Environmental/Safety Manager

Gemini

Post Office Box 699

El Reno, Oklahoma 73036

IV-D-158 Mr. Jay A. Haines

President/CEO

Textured Coatings of America, Inc.

5950 S. Avalon Boulevard

Los Angeles, California 90003-1384

IV-D-159 Mr. Robert L. Hawkins, Jr.

Senior Vice President

Waterlox Coatings Corporation

9808 Meech Avenue

Cleveland, Ohio 44105

IV-D-160 Mr. Robert L. Hawkins, Jr.

Senior Vice President

Waterlox Coatings Corporation

9808 Meech Avenue

Cleveland, Ohio 44105

IV-D-161 Ms. Madelyn K. Harding

Administrator

Product Compliance & Registrations

Sherman-Williams Company

101 Prospect Avenue, N.W.

Cleveland, Ohio 44115-1075
TABLE 2-1. LIST OF COMMENTERS ON THE PROPOSED NATIONAL 

ARCHITECTURAL COATINGS RULE (CONTINUED)

Docket Number Commenter and affiliation

2-23

IV-D-162 Mr. Banard R. Appleman

Executive Director

Mr. Michael J. Masciale

President

Steel Structures Painting Council

40 24th Street, 6th Floor

Pittsburg, Pennsylvania 15222-4643

IV-D-163 Ms. Barbara A. Kwetz

Director

Division Air Quality Control

Commonwealth of Massachusetts

Department of Environmental Protection

One Winter Street

Boston, Massachusetts 02108

IV-D-164 duplicate of item IV-D-158 

IV-D-165 Mr. Richard Hardy

President

X-I-M Products, Inc.

1169 Bassett Road

Westlake, Ohio 44145

IV-D-166 Mr. James S. Jennison

President

Jennison Industries

106 Washington

Post Office Box 965

Burlington, Iowa 52601

IV-D-167 Mr. William M. Tunno

Chairman/CEO

Hanley Paint Manufacturing Company, Inc.

Post Office Box 12130

El Paso, Texas 79913

IV-D-168 Ms. Suzanne C. Beamer

Vice President

Government Relations & Public Affairs

International Sign Association

801 N. Fairfax Street, Suite 205

Alexandria, Virginia 22314

IV-D-169 Mr. Kelley Brandt

Director, Regulatory Affairs

The Valspar Corporation

Post Office Box 1461

Minneapolis, Minnesota 55440
TABLE 2-1. LIST OF COMMENTERS ON THE PROPOSED NATIONAL 

ARCHITECTURAL COATINGS RULE (CONTINUED)

Docket Number Commenter and affiliation

2-24

IV-D-170 Mr. Michael P. Stock

Vice President

TK Products

Division of Sierra Corporation

11400 West 47th Street

Minnetonka, Minnesota 55343

IV-D-171 Mr. Jay H. Burrill

Environmental Coordinator

Grace Construction Products

W.R. Grace & Company,-Conn.

62 Whittemore Avenue

Cambridge, Massachusetts 02140-1692

IV-D-172 Mr. Thomas J. Calautti

General Manager

Fiberlock Technologies, Inc.

630 Putnam Avenue

Post Office Box 390432

Cambridge, Massachusetts 02139-0802

IV-D-173 Mr. Kevin C. Hemenway

President

Kush Paint Company

19556 Masonic Boulevard

Roseville, Michigan 48066

IV-D-174 Mr. Ronald R. Methier

Chief

Air Protection Branch

Georgia Department Of Natural Resources

Environmental Protection Division

4244 International Parkway, Suite 120

Atlanta, Georgia 30354

IV-D-175 Mr. Mark Uglem

Executive Vice President

Hirshfield’s Paint Manufacturing, Inc.

4450 Lyndale Avenue No.

Minneapolis, Minnesota 55412

IV-D-176 Ms. Holly M. Bartel

President

Glista

327 South Kenyon

Seattle, Washington 98108
TABLE 2-1. LIST OF COMMENTERS ON THE PROPOSED NATIONAL 

ARCHITECTURAL COATINGS RULE (CONTINUED)

Docket Number Commenter and affiliation

2-25

IV-D-177 Mr. Edward D. Edwards

5220 Meadville Street

Greenwood, Minnesota 55331

IV-D-178 Mr. Ned B. Kisner

President

Triangle Coatings, Inc.

1930 Fairway Drive

San Leandro, California 94577

IV-D-179 Mr. Joe Hundley

Martinsville Emulsion Products Company, Inc.

Post Office Box 5384

Martinsville, Virginia 24115

IV-D-180 Mr. Alan R. Schuweiler

Director of Chemistry

Tennant

701 North Lilac Drive

Post Office Box 1452

Minneapolis, Minnesota 55440-1452

IV-D-181 Mr. Jim Van Pelt

President

Roof Coatings Manufacturers Association

6000 Executive Boulevard, Suite 201

Rockville, Maryland 20852-3803

IV-D-182 Mr. Robert B. Walker, Jr.

President

Rose Talbert Paints

Post Office Box 2658

Cayce-West Columbia, South Carolina 29171

IV-D-183 Mr. Richard D. Williamson

Vice President

G & W Enterprises, Inc. dba

Trinity Coatings Company

Post Office Box 2488

Fort Worth, Texas 76113-2488

IV-D-184 Mr. S. William Becker

STAPPA/ ALAPCO

444 North Capitol Street

Washington, DC 20001

IV-D-185 Ms. Nancy S. Bryson

Crowell & Moring, LLP

1001 Pennsylvania Avenue, N.W.

Washington, DC 20004-2595
TABLE 2-1. LIST OF COMMENTERS ON THE PROPOSED NATIONAL 

ARCHITECTURAL COATINGS RULE (CONTINUED)

Docket Number Commenter and affiliation

2-26

IV-D-186 Mr. L.W. Cranford, Jr.

Sales Manager

Lindau Chemicals, Inc.

731 Rosewood Drive

Columbia, South Carolina 29201

IV-D-187 Mr. Mark S. Horton

Regulatory Affairs Manager

Chemrex, Inc.

889 Valley Park Drive

Shakopee, Minnesota 55379

IV-D-188 Mr. Michael P. Kenny

Executive Officer

California Environmental Protection Agency

Air Resources Board

2020 L Street

Post Office Box 2815

Sacramento, California 95812-2815

IV-D-189 Mr. Robert J. Nelson

Director Environmental Affairs

Mr. Jim Sell

Senior Counsel

National Paint and Coatings Association

1500 Rhode Island Avenue, N.W.

Washington, DC 20005

IV-D-190 Mr. Andrew Schlafly

President

The Clean Air Coalition Foundation

521 Fifth Avenue, 17th Floor

New York, New York 10175

IV-D-191 Ms. Linda Waade

Executive Director

Mr. Tim Carmichael

Project Director

Coalition for Clean Air 

Ms. Gail R. Feuer

Senior Attorney

Mr. David S. Beckman

Senior Project Attorney

Natural Resources Defense Council

6310 San Vicente Boulevard, Suite 250

Los Angeles, California 90048
TABLE 2-1. LIST OF COMMENTERS ON THE PROPOSED NATIONAL 

ARCHITECTURAL COATINGS RULE (CONTINUED)

Docket Number Commenter and affiliation

2-27

IV-D-192 Mr. Richard D. Williamson

Senior Vice President

G & W Enterprises, Inc. dba

Trinity Coatings Company

Post Office Box 2488

Fort Worth, Texas 76113-2488

IV-D-193 Mr. Richard Hardy 

President

X-I-M Products, Inc.

1169 Bassett Road

Westlake, Ohio 44145

IV-D-194 Mr. Donald A. Eckel

President

AACCO

5520 N. 125th Street

Butler, Wisconsin 53007

IV-D-195 Mr. John C. Hukey

Technical Service Manager

Dayton Superior Corporation

402 South First Street

Oregon, Illinois 61061

IV-D-196 Mr. Larry E. Schwietz

CEO

L & M Construction Chemicals, Inc.

14851 Calhoun Road

Omaha, Nebraska 68152

IV-D-197 Mr. Michael P. Stock

Vice President

TK Products 

Division of Sierra Corporation

11400 West 47th Street

Minnetonka, Minnesota 55343

IV-D-198 Mr. James K. Crawford

General Manager

EDOCO

22039 South Westward Avenue

Long Beach, California 90810-1681

IV-D-199 Mr. William Miller

General Manager

Symons Corporation

Post Office Box 744

Contralia, Illinois 62801
TABLE 2-1. LIST OF COMMENTERS ON THE PROPOSED NATIONAL 

ARCHITECTURAL COATINGS RULE (CONTINUED)

Docket Number Commenter and affiliation

2-28

IV-D-200 Shree Nabar

Technical Director

Tamms Industries

7405 Production Drive

Mentor, Ohio 44060

IV-D-201 Mr. Moorman L. Scott

Vice President

The Euclid Chemical Company

19218 Redwood Road

Cleveland, Ohio 44110-2799

IV-D-202 Mr. Mark S. Horton

Regulatory Affairs Manager

Chemrex, Inc.

889 Valley Park Drive

Shakopee, Minnesota 55379

IV-D-203 Mr. Paul Smith

The Spray-Cure Company

300 Edwards Street

Madison, Ohio 44057-3112

IV-D-204 Carbit Paint Company

927 W. Blackhawk Street

Chicago, Illinois 60622-2519

IV-D-205 RAE Products and Chemicals Corporation

11630 South Cicero Avenue

Alsip, Illinois 60658-2599

IV-D-206 Mr. Kent W. Colton

Executive Vice President/CEO

National Association of Home Builders

1201 15th Street, N.W.

Washington, DC 20005-2800

IV-D-207 Mr. Michael P. McCarthy

President/COO

Harrison Paint Corporation

Post Office Box 8470

Canton, Ohio 44711

IV-D-208 Mr. James R. Tucker

Director of Corporate Research & Development

Armorall Products Corporation

6 Liberty

Aliso Viejo, California 92656
TABLE 2-1. LIST OF COMMENTERS ON THE PROPOSED NATIONAL 

ARCHITECTURAL COATINGS RULE (CONTINUED)

Docket Number Commenter and affiliation

2-29

IV-D-209 Mr. Sidney Freedman

Director

Architectural Precst Concrete Services

Precast/Prestressed Concrete Institute

175 West Jackson Boulevard

Chicago, Illinois 60604-9773

IV-D-210 Mr. Larry E. Schwietz

CEO

L & M Construction Chemicals, Inc.

14851 Calhoun Road

Omaha, Nebraska 68152

IV-D-211 Mr. James A. Westerhaus

Regulatory Services Vice President

Ecolab, Inc.

370 N. Wabasha Street

Saint Paul, Minnesota 55102

IV-D-212 Mr. Bob Mitchell

Dunn-Edwards Corporation

4885 East 52nd Place

Los Angeles, California 90040

IV-D-213 Mr. Marc Freedman

Director of Government Affairs

Painting and Decorating Contractors of

America

3913 Old Lee Hwy., Suite 33-B

Fairfax, Virginia 22030

IV-D-214 Smiland & Khachigian

Seventh Floor

601 West Fifth Street

Los Angeles, California 90071

IV-D-215 Mr. Bernard K. Zysman

Technical Services Specialist

OxyChem

Post Office Box 344

Niagra Falls, New York 14302-0344

IV-D-216 The Architectural Coatings Regulatory

Negotiation Committee

ALARM Caucus

Post Office Box 2488

Fort Worth, Texas 76113-2488
TABLE 2-1. LIST OF COMMENTERS ON THE PROPOSED NATIONAL 

ARCHITECTURAL COATINGS RULE (CONTINUED)

Docket Number Commenter and affiliation

2-30

IV-D-217 Mr. Charles Rushing

Chief Chemist

Wellborn Paints

A Dunn-Edwards Company

Post Office Box 25645

Albuquerque, New Mexico 87105-0645

IV-D-218 Mr. Loren A. Plotkin

Executive Vice President

Lighthouse Products

Post Office Box 1253

New Smyrna Beach, Florida 32170

IV-D-219 Mr. Richard B. Cunningham

President

Passonno Paints

500 Broadway

Watervliet, NY 12189

IV-D-220 Mr. Richard B. Cunningham

President

Passonno Paints

500 Broadway

Watervliet, NY 12189

IV-D-221 Mr. Maxie E. Quinn

President

Dyco Paints, Inc.

5850 Ulmerton Road

Clearwater, Florida 34620-3989

IV-D-222 Mr. Bob Cummins

President

Wellborn Corporation

215 Rossmoor S.W.

Albuquerque, New Mexico 87105
TABLE 2-1. LIST OF COMMENTERS ON THE PROPOSED NATIONAL 

ARCHITECTURAL COATINGS RULE (CONTINUED)

Docket Number Commenter and affiliation

2-31

IV-D-223 Mr.William G. Schauz

IV-D-224 Mr. Jim Duffey

IV-D-225 Mr. Mike Twining

IV-D-226 Mr. Fred L. Zupicich, Sales Manager

United States Air Force

HQAFCESA/CES

139 Barnes Drive, Suite 1

Tyndall AFB, Florida 32403-5319

Palo Duro Hardwoods, Inc.

4800 Lima Street

Denver, Colorado 80239

Palo Duro Hardwoods, Inc.

4800 Lima Street

Denver, Colorado 80239

Mr. Raymond Pavlik, Vice President

Dampney Company, Inc.

85 Paris Street

Everett, Massachusetts 02149

IV-F-01a Mr. Josie Pradella

STAPPA/ALAPCO

444 North Capitol Street

Washington, DC 20001

IV-F-01b Mr. Barry Jenkin

Benjamin Moore

IV-F-01c Mr. Bob Mitchell

Dunn-Edwards Corp.

4885 East 52nd Place

Los Angeles, California 90040

IV-F-01d Mr. Howard Berman

Wellborn Paint

IV-F-01e Mr. Mark S. Horton

Regulatory Affairs Manager

Chemrex, Inc.

889 Valley Park Drive

Shakopee, Minnesota 55379 
TABLE 2-1. LIST OF COMMENTERS ON THE PROPOSED NATIONAL 

ARCHITECTURAL COATINGS RULE (CONTINUED)

Docket Number Commenter and affiliation

2-32

IV-F-01f Mr. Marc Freedman

Director of Government Affairs

Painting and Decorating Contractors of

America

3913 Old Lee Hwy., Suite 33-B

Fairfax, Virginia 22030

IV-F-01g Mr. Larry Chapman

Inland Coatings Corp.

IV-F-01h Ms. Lesa K. McDonald

Environmental/Safety Manager

Gemini

Post Office Box 699

El Reno, Oklahoma 73036

IV-F-01i Mr. Gary Driscoll

Basic Coatings, Inc.

IV-F-01j Ms. Madelyn K. Harding

Administrator

Product Compliance & Registrations

Sherman-Williams Company

101 Prospect Avenue, N.W.

Cleveland, Ohio 44115-1075

IV-F-01k Mr. Don Collier

Courtauld Coatings

IV-F-01(l) Mr. Robert Wendoll

Triangle Coatings

1930 Fairway Dr.

San Leandro, California 94577

IV-F-01m Mr. Robert Wendoll

El RAP

4885 E. 52nd Pl.

Los Angeles, California 90040

IV-F-01n Mr. Earle Borman

Thompson Minwax Co.

8 Shoremame Club Rd.

Old Greenwich, Connecticut

IV-F-01o Mr. Jim Sell 

National Paint & Coatings Association (NPCA)

1500 Rhode Island Ave., NW

Washington, DC 20005
TABLE 2-1. LIST OF COMMENTERS ON THE PROPOSED NATIONAL 

ARCHITECTURAL COATINGS RULE (CONTINUED)

Docket Number Commenter and affiliation

2-33

IV-F-01p Mr. Richard Gold

Holland & Knight

(Outside Environmental Counsel to NPCA)

IV-F-01q Richard Williamson 

Textured Coatings of America

4275 Executive Sq., Suite 320

Lajolla, California 92037

IV-F-01r Mr. Jim Van Pelt

President

Roof Coatings Manufacturers Association

6000 Executive Boulevard, Suite 201

Rockville, Maryland 20852-3803

IV-F-01s Mr. Charleds Brush

RPM Corp.

IV-F-02gen Unidentified commenter at public meeting

IV-F-02a Mr. Richard Cunningham

Passono Paints

500 Broadway

Waterolier, New York 12189 

IV-F-02b Mr. Jay Haines

Textured Coatings of America

4275 Executive Sq., Suite 320

Lajolla, California 92037

IV-F-02c Mr. Mark Algaier

Hillyard Indutries

P.O. Box 909

Box 302 N. 4th St.

St. Joseph, Missouri 64502

IV-F02d Mr. Ned B. Kisner

Triangle Coatings

1930 Fairway Dr.

San Leandro, California 94577

IV-F-02e Mr. Valery Tokar

Conspec Mkg. & M

636 S. 66th Terrace

Kansas City, Kansas 66213

IV-F-02f Mr. Larry Schwietz

L&M Construction, Chem., Inc.

14851 alhoun Rd.

Omaha, Nebraska 68152
TABLE 2-1. LIST OF COMMENTERS ON THE PROPOSED NATIONAL 

ARCHITECTURAL COATINGS RULE (CONTINUED)

Docket Number Commenter and affiliation

2-34

IV-F-02g Mr. D. John Long

Keeler & Long, Inc.

Box 460

Watertown, Connecticut 06795

IV-F-02h Mr. Sam Jennison

Jennison Ind.

Box 965

Burlington, Iowa 52601

IV-F-02i Mr. Rod Salyer

Koch Materials Co.

4900 S. Mason Ave.

Chicago, Illinois 60638

IV-F-02j Mr. Steven Olson

Hallman Lindsay Paint

501 S. Bird St.

Sun Prairie, Wisconsin 53590

IV-F-02k Mr. David Westerman

Carbit Paint Co.

927 Blackhawk St.

Chicago, Illinois 60622

IV-F-02(l) Mr. Robert L. Hawkins

Waterlox Coatings

9808 Meeca Ave.

Cleveland, Ohio 44105

IV-F-02m Ace Coatings

IV-F-02 Mr. Jim Robellaro

Valspar Corp.

1191 Wheeling Rd.

Whelling, Illinois 60090

IV-F-02o Mr. Robert Wendoll

El Rap

4885 52nd Pl.

Los Angeles, California 90040

IV-F-02p Mr. Michael Stock

TK Products

11400 W. 47th St.

Minnetonka, Minnesota 55343
TABLE 2-1. LIST OF COMMENTERS ON THE PROPOSED NATIONAL 

ARCHITECTURAL COATINGS RULE (CONTINUED)

Docket Number Commenter and affiliation

2-35

IV-F-02q Mr. Max A. Baum

Easterday Paint & Chem. Co.

1306 E. Bolivar Ave.

St. Francis, Wisconsin 53235

IV-F-02r Mr. Guy Gruenberg

RAE Products

11630 S. Cicero Ave.

Alsip, Illinois 60658

IV-G-01 Mr. George Baty

President

Cresset Chemical Company

Post Office Box 367 

Weston, Ohio 43569

IV-G-02 Mr. Richard A. Rosvold

H.B. Fuller Company

Post Office Box 64683

St. Paul, Minnesota 55164-0683

IV-G-03 Mr. Henry S. Shaw

CenterLine Industries, Inc.

5380 Bircher Boulevard

Post Office Box 66802

St. Louis, Missouri 63166-6802

IV-G-04 Mr. J. Kemp

Akzo Nobel

Holmbladsgade 70

DK2300 Kobenhaven S

Denmark

IV-G-05 Mr. J. Andrew Doyle

President

National Paint & Coating Association

1500 Rhode Island Avenue, N.W.

Washington, DC 20005-5597

IV-G-06 Mr. Larry E. Schwietz

CEO

L & M Construction Chemicals, Inc.

14851 Calhoun Road

Omaha, Nebraska 68152

IV-G-07 Mr. John C. Hukey

Technical Service Manager

Dayton Superior Corporation

402 South First Street

Oregon, Illinois 61061
TABLE 2-1. LIST OF COMMENTERS ON THE PROPOSED NATIONAL 

ARCHITECTURAL COATINGS RULE (CONTINUED)

Docket Number Commenter and affiliation

2-36

IV-G-08 Mr. Moorman L. Scott

Vice President

The Euclid Chemical Company

19218 Redwood Road

Cleveland, Ohio 44110-2799

IV-G-09 Mr. Michael P. Stock

Vice President

TK Products

Division of Sierra Corporation

11400 West 47th Street

Minnetonka, Minnesota 55343

IV-G-10 Mr. Paul Smith

The Spray-Cure Company

300 Edwards Street

Madison, Ohio 44057-3112

IV-G-11 Mr. Kenneth S. Petersen

Director of Sales and Marketing

Poly-Wall International, Inc.

8400 Coral Sea Street N.E. #800

Blaine, Minnesota 55449

IV-G-12 Mr. Robert Mitchell

IV-G-13 Mr. Thomas R. Wood

IV-G-14 Ms. Jan C. Winn

IV-G-15 Ms. Susan N. Stafford

Dunn-Edwards Corporation

4885 East 52nd Place

Los Angeles, California 90040

Stoel Rives, LLP Attorneys

Standard Insurance Center

900 S.W. Fifth Avenue

Suite 2300

Portland, Oregon 97204-1268

Edoco

22039 South Westward Avenue

Long Beach, California 90810-1681

Stoel Rives, LLP Attorneys

Standard Insurance Center

900 S.W. Fifth Avenue

Suite 2300

Portland, Oregon 97204-1268
2-37

2.1 METHOD OF REGULATION

2.1.1 Section 183(e) Requirements

Comment: One commenter (IV-D-02/IV-D-178/IV-F-1K) stated

that the objective of a national VOC standard is to reduce ozone

formation, not to reduce "in-the-can" VOC content of coatings,

which is only one factor affecting ozone formation. The

commenter indicated that the EPA must also consider factors such

as: (1) emissions per area covered by the coating, (2) use of

seasonal control strategies, and (3) whether the coating is

applied in a nonattainment area. The commenter also stated that

the EPA must consider the relative reactivity of the emissions. 

The commenter suggested that the EPA use a method for relating

emissions per area covered that was presented during the

regulatory negotiations (II-E-7). The commenter stated that

lowering the VOC content of coatings potentially increases total

VOC emissions because the film thickness increases. The

commenter contended that lower VOC coatings or substitutes tend

to produce a thicker film when applied that results in a smaller

surface area being covered with a given amount of a coating. As

a result, the commenter contended that more coatings would be

required and VOC emissions could increase rather than decrease as

a result of the rule. The commenter pointed out that a method

for relating emissions per area covered was presented during the

architectural coating regulatory negotiations but did not appear

in the proposed rule. 

Response: The EPA agrees that the primary objective of this

rule is to reduce ozone pollution across the country and believes

that reduction of the VOC content of coatings is the best

approach under section 183(e) of the Clean Air Act (Act) to

achieve the reductions. The EPA believes that the commenter’s

suggestion to consider the emissions per area covered is

impractical for architectural coatings. As discussed in

section 2.2.6 of this document, the surface area covered by any

given coating will vary depending upon a number of factors

including the substrate being coated and the climatic conditions
2-38

at the time of application. Thus, the EPA has not related VOC

emissions to area covered by a volume of a given product. 

The EPA believes that the commenter’s suggestion to control

VOC emissions during only the ozone season is also not

appropriate. Restricting the season when end users may apply

architectural coatings is not practical to enforce since end

users include homeowners and contractors applying coatings at

varying times and locations. In addition, section 183(e) of the

Act does not provide the EPA with the regulatory authority to

regulate end users via a national rule. The nature of

architectural coatings as a consumer and commercial product does

not allow for control strategies that reduce emissions during

only the ozone season. The shelf life and consumption rate of

architectural coatings varies greatly, and no one can accurately

predict that a certain percentage of a product made with a

specified formulation will be consumed and, thus, cause VOC

emissions during any particular time period. Because the

consumption rate of architectural coatings is variable and

unpredictable, achieving reductions during only an ozone season

is not a viable control strategy. A rule based upon an ozone

season could potentially require manufacturers to produce at

least two lines of products (for ozone season and non-season) and

to have a reliable means of tracking products. Moreover,

determining what would constitute the ozone season for each area

across the nation in light of vastly different topographical and

meteorological considerations would render a seasonal approach

even more complex for the EPA to administer and for regulated

entities to comply with. The difficulties with enforcement of

such a seasonal rule would also multiply geometrically, and the

EPA believes that it would thereby jeopardize the ability of the

regulations to achieve the intended VOC emission reductions. The

EPA, therefore, concluded that uniform levels on the amount of

VOC incorporated into the products would be the most feasible,

most effective, and least disruptive control measure.

The EPA also maintains that controlling whether individual

coatings are applied in ozone attainment or nonattainment areas
2-39

would be impractical. Architectural coatings are easily

transportable from one area to another, and therefore, it would

be difficult for a manufacturer to predict accurately where they

may be applied. The primary objective of rules under

section 183(e) is to reduce VOC emissions in ozone nonattainment

areas, and the EPA has concluded that the most effective

alternative is to implement a nationwide rule, as discussed in

section 2.1.2 of this document and in section 2.3.1 of the

183-BID. 

 The commenter’s argument that lowering VOC content limits

would increase VOC emissions due to increased film thickness and

less coverage is contradictory because a coating with more solids

will actually cover a greater surface area. The assertion that

lower VOC coatings have smaller coverage area is not consistent

with information provided by the manufacturers’ Material Safety

Data Sheets (MSDS), technical data sheets, and coating can

labels. For house paint, for example, this information typically

shows that regardless of the solids content by weight, the

coverage area of the various coatings is relatively similar. The

EPA contends that compliant coatings have a coverage area that is

equivalent to or better than higher VOC non-compliant coatings. 

Hence, it is not expected that a larger quantity of compliant

coating will be necessary to cover the same area. The EPA has

seen no indication that increased coating usage is required with

compliant coatings.

2.1.2 National Rule Versus Other Strategies

Comment: Commenters (IV-D-82, IV-D-120, IV-F-2) argued for

VOC controls that apply only in nonattainment areas instead of

rules that apply in both nonattainment and attainment areas. One

commenter (IV-D-120) asserted that a rule applied only in

nonattainment areas would lessen the economic impact on both

manufacturers who market coatings nationwide and those who sell

products solely in attainment areas. The commenter stated that

because manufacturers have already been operating under the

patchwork of existing regulatory requirements, complying with the

current local and State requirements is likely to be more
2-40

cost-effective than complying with a rule that applies to

products sold in both nonattainment and attainment areas. The

commenter argued that a rule that applied only to nonattainment

areas would allow it to produce and sell products in attainment

areas that would not be marketable under a rule that applied to

both nonattainment and attainment areas. The commenter supported

the use of a rule that applied only to nonattainment areas by

arguing that the overarching goal of the rule is to reduce VOC

emissions in areas with ozone levels that violate the ozone

National Ambient Air Quality Standard (NAAQS). Commenters at the

small business meeting (IV-F-2) suggested that the EPA consider

issuing a national rule that only applies to nonattainment areas. 

One commenter (IV-F-2) contended that a national rule that

applies to nonattainment areas only would reduce the burden on

small businesses while increasing consistency in requirements

across the country. Another commenter (IV-F-2) argued that a

national rule that applied to nonattainment areas only would

focus costs on areas which needed control. One commenter

(IV-D-82) objected strongly to the use of nationwide VOC content

limits in future rules and argued that these limits should only

be applied in nonattainment areas.

Six commenters (IV-D-28, IV-D-33, IV-D-161, IV-D-162,

IV-D-174, IV-F-1j) opposed the adoption of rules that apply only

to nonattainment areas. One commenter (IV-D-161/IV-F-1j) argued

that if the VOC regulation for architectural coatings were

adopted as a Control Technique Guideline (CTG) that applied only

to nonattainment areas, then the cost per ton of emissions

reduced would increase significantly because the cost of lower

VOC technologies would increase (due to decrease in sales

volume). The commenter (IV-D-161) also contended that a CTG

would not produce emission reductions equivalent to those of a

national rule. The commenter predicted that controlling purchase

and use of regulated coating products within a given

nonattainment area would be difficult and lead to ineffective and

costly enforcement. Additionally, the commenter contended that

CTG implementation would result in different requirements in each
2-41

nonattainment area. The commenter argued that such different

requirements in each nonattainment area would result in multiple,

complex compliance burdens for manufacturers. Another commenter

(IV-D-33) also stated that a national VOC rule for architectural

coatings would be more consistent and cost-effective than a CTG. 

The commenter stated that, due to the widespread and variable

distribution of architectural coatings, a rule that applies only

to nonattainment areas is not appropriate.

Response: Section 183(e) of the Act authorizes the EPA to

obtain VOC reductions through either regulations or CTG, but

includes certain requirements on each option. A CTG, by

definition, applies only in nonattainment areas, whereas rules

generally apply nationwide. The EPA has discretion to consider a

CTG as a regulatory alternative if the CTG will be substantially

as effective as a national rule to reduce emissions of VOC in

ozone nonattainment areas. For some product categories, a CTG

can be substantially as effective as a national regulation. In

fact, for some products, a CTG may be significantly more

effective because end users can be targeted rather than suppliers

of the product and, therefore, emission reductions can be

obtained through add-on control technologies, application

equipment specifications, and work practice standards. A

national rule, on the other hand, is limited to requirements

applicable to the manufacturers, processors, wholesale

distributors, or importers of consumer or commercial products.

Section 183(e) explicitly authorizes the EPA to include any

system of regulation that the EPA deems appropriate. For

architectural coatings, which are highly transportable and can be

used in any location at any time, the EPA has determined that

regulations that target products used solely in nonattainment

areas would not be as effective as a national regulation

targeting all manufacturers of all the products. Thus, the EPA

has concluded that a rule applicable only to nonattainment areas

or a CTG would not be the best means to achieve the intended VOC

emission reductions for architectural coatings. Architectural

coatings are used primarily by homeowners, contractors, and a
2-42

wide variety of other types of consumers rather than by a

manufacturing facility in a fixed location. Transportability of

the products would tend to decrease rule effectiveness for a

nonattainment area only regulation due to the likelihood of

noncompliant products being bought in attainment areas and used

in nonattainment areas. In contrast, a national regulation that

applies both in attainment and nonattainment areas will eliminate

the potential for transport of products that would negate the

intended VOC emission reductions of the rule. A national

regulation will help ensure effective enforcement and

implementation of VOC controls in all areas.

Comment: Seven commenters (IV-D-02/IV-F-1(l), IV-F-1q,

IV-D-16/IV-D-166, IV-D-26, IV-D-73, IV-D-120, IV-D-175) opposed

an architectural coating rule that would apply to areas that are

in attainment of the NAAQS for ozone. One commenter

(IV-D-02/IV-F-1(l)) argued that a rule that applied to both

nonattainment and attainment areas would place a reformulation

burden on hundreds of small businesses that manufacture and sell

coatings only in attainment areas and, therefore, do not

contribute to the ozone nonattainment problem. Another commenter

(IV-D-26) stated that consumers in attainment areas should not be

forced to forego the benefits of lower cost, higher quality

coatings in order to reduce ozone in nonattainment areas. 

One commenter (IV-D-73) stated that, due to different

conditions throughout the nation, such as lower temperatures or

higher elevations, a nationwide rule does not make sense. The

commenter further stated that, by promoting uniformity, a

nationwide rule limits consumer choices. According to the

commenter, this helps large manufacturers selling coatings across

State lines and hurts small businesses that sell coatings only in

attainment areas. Another commenter (IV-F-1q) stated that

regulating architectural coatings only in nonattainment areas

could open up coating markets where small businesses can compete

with large businesses by furnishing a niche product. One

commenter (IV-D-175), a manufacturer in Minnesota, sells almost

all of its product within a State that is in attainment of the
2-43

ozone NAAQS, and questioned why the company should be regulated

under this rule.

Seventeen commenters (IV-D-28, IV-D-30, IV-D-32, IV-D-33,

IV-D-96, IV-D-117, IV-D-129, IV-D-151, IV-F-1a, IV-F-1b, IV-F-1g,

IV-F-1i, IV-F-1j, IV-F-1k, IV-F-1n, IV-F-1p, IV-F-1s) supported a

national architectural coating VOC rule. One commenter (IV-F-1a)

stated that the United States has a significant ozone problem and

cannot afford to overlook or ineffectively regulate any source of

ozone precursors. The commenter agreed with the EPA that

architectural coatings represent a significant source category

(almost 3 percent of all anthropogenic VOC emissions and almost

10 percent of VOC emissions from all consumer and commercial

products). Another commenter (IV-D-117) supported establishing a

strong national rule for architectural coatings because

State-by-State control is an ineffective approach and would not

be sufficient to allow nonattainment areas to reach attainment. 

One of the commenters (IV-D-129) stated that the benefits

associated with a national VOC rule for architectural coatings

includes decreased workplace exposure to toxic and flammable

materials and lower toxicity of waste generated in the

manufacturing process. A State agency (IV-D-96) expressed

support for a national rule for architectural coatings,

especially one that obtains the 25 percent creditable reductions

committed to in the 1993 State Implementation Plan (SIP) based on

Reasonably Available Control Technology (RACT). According to the

commenter, the rule would allow States to implement and enforce

architectural coating regulations more effectively, and would

help industry to reformulate architectural coatings. 

Response: The EPA agrees that some areas of the country may

not need reductions in VOC from architectural coatings to attain

the ozone NAAQS. However, to achieve effective control of VOC

emissions in nonattainment areas from products such as

architectural coatings, a nationwide regulation targeting the

manufacturers of these products is the most effective and

efficient control strategy available to the EPA. 

Section 183(e)(4) of the Act authorized the EPA to determine the
 OTAG is a group made up of State, Federal, industry 1

organizations and environmental groups charged by the EPA with

developing consensus recommendations regarding implementation of

the Clean Air Act as amended in 1990 related to ground-level

ozone problems in the United States.

2-44

most effective system or systems of regulation that the EPA

determines is appropriate to obtain reductions of VOC emissions

from consumer and commercial products and aid in attainment of

the ozone NAAQS. A national rule that focuses on manufacturers

and importers is an effective approach for reducing emissions

from architectural coatings, which are easily transportable and

widely distributed to consumers and contractors for use in

various locations from day to day.

Many existing nonattainment areas have identified the

control of consumer and commercial products, such as

architectural coatings, automobile refinishing coatings, and

consumer products, in their strategies to reduce VOC emissions to

attain the ozone NAAQS. In fact, the Ozone Transport Assessment

Group (OTAG) included in its June 1997 recommendations to the 1

EPA, a recommendation that the EPA continue to develop, adopt,

and implement stringent national control measures that meet or

exceed emission reduction levels specified by OTAG. In the case

of architectural coatings, the group recommended future control

requirements in the year 2003 to achieve reductions beyond those

expected from this rule.

The EPA has concluded that regulation of architectural

coatings in attainment areas may increase the effectiveness of

the rule by eliminating the potential for transport of

non-compliant products into nonattainment areas. Other reasons

for the EPA’s determination that a national rule is the

appropriate regulatory approach for architectural coatings are

discussed below in the remainder of this section. In addition,

modeling often indicates high emission reduction targets may be

necessary to meet the ozone NAAQS in the nonattainment areas. 

Some States have run out of effective control activities on the

local level. For these States, elimination of the possibility
2-45

for transport of non-compliant products into their jurisdiction

will be helpful in their effort to achieve attainment. 

With regard to the suggestion that the EPA exempt companies

that sell coatings only in attainment areas, the June 25, 1996

proposal requested comment on the number and identity of

manufacturers who sell products solely in attainment areas. The

EPA made this request to evaluate whether any special provisions

for these manufacturers might be warranted. A total of five

companies spoke at the small business meeting (IV-F-2) indicating

that they sold almost all of their products in attainment areas. 

Two additional companies (IV-D-73, IV-D-175) submitted letters

implying that they also market the majority of their products in

attainment areas. The EPA believes that the limited response to

this request indicates that there is not sufficient evidence to

support providing such an exemption or special provision.

Moreover, the EPA notes that section 183(e)(1)(C) explicitly

defines regulated entities to include manufacturers or importers

who sell or distribute their products in interstate commerce. 

Even those manufacturers or importers who may not broadly market

their products are nonetheless introducing their products into

interstate commerce, and thus, are within the scope of the

regulations intended by the Act.

Comment: Five commenters (IV-D-129, IV-D-161, IV-F-1b,

IV-F-1g, IV-F-1s) supported the EPA’s proposal of a nationwide

rule that applies to both attainment and nonattainment areas

because it will provide a level playing field for all

manufacturers. According to one of these commenters (IV-F-1s),

many products of small, independent businesses are designed to

meet the needs of niche markets for specialized coatings and the

manufacturers need access to a wide geographical market to sell

the volume or product necessary to make a profit. The commenter

noted that these companies find it increasingly difficult to

track and comply with different State, county, and city

regulations of VOC. Therefore, the commenter argued that small

businesses need an architectural coating VOC rule that applies to

both attainment and nonattainment areas nationwide to compete
2-46

effectively. Another commenter (IV-F-1g) noted that it does not

have an in-house sales force and depends on distributors to

market its products. The commenter indicated that some

distributors are not willing to handle the commenter's products

unless they can market them throughout their territory. The

commenter noted that ever-changing individual State and local

rules can make it difficult for manufacturers to comply. Another

commenter (IV-F-1b) argued that a uniform, practical, Federal

control measure that applies to attainment and nonattainment

areas will allow the sale of high quality coatings to the

consumer and will provide a level playing field for manufacturers

while achieving meaningful reductions in air pollution. 

Response: The EPA agrees that the national rule will be

advantageous for coatings manufacturers for the reasons stated by

the commenters. During the development of the architectural

coating rule, industry representatives expressed concern that

differences in State and local requirements for architectural

coatings, as could occur under a non-nationwide rule or CTG

approach, would disrupt the national distribution network for

architectural coatings. The EPA recognizes that for

manufacturers who distribute across wider geographical areas,

rules that apply to both nonattainment and attainment areas

provide the additional benefit of promoting consistency in

regulations, thereby making it easier for companies to compete

with each other. While promoting national uniformity is one

incidental benefit of the implementation of a national rule, the

EPA notes that it is but one factor that the EPA has taken into

account in determining what system or systems of regulation would

be best to achieve the objectives of section 183(e) of the Act.

Comment: Six commenters (IV-D-32, IV-D-129, IV-F-1e,

IV-F-1g, IV-F-1n, IV-F-1q) supported a national VOC rule for

architectural coatings because it would be more cost-effective

than a regulatory approach that could result in different

requirements for attainment and nonattainment areas. Four

commenters (IV-D-129, IV-F-1e, IV-F-1n, IV-F-1q) agreed that a

nationwide VOC regulation for architectural coatings would ease
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the burden on manufacturers to keep track of the applicable

limits, categories, exemptions, and other requirements for

numerous State regulations. One commenter (IV-F-1g), a

manufacturer of niche products, supported a national VOC rule for

architectural coating because as a small company, the commenter

lacks the resources to petition each State for variances. 

Another commenter (IV-F-1i), a small company that markets in

50 States, stated that its sales volume in any one State is too

low to support the potential cost of relabeling, reformulating,

etc., to meet various State requirements. A State commenter

(IV-D-32) stated that a national architectural coating rule would

allow the State of Oregon to retire its local architectural

coatings program and apply those resources to other environmental

needs. According to one commenter (IV-D-129), the time and

expense to comply with the existing patchwork system of State and

regional regulations affecting the architectural coating industry

could be better spent developing lower VOC products and

initiating other pollution prevention programs.

Five commenters (IV-D-30, IV-D-151, IV-D-161, IV-F-1i,

IV-F-1j) supported a national architectural coatings VOC rule

because it will make compliance easier, and one commenter

(IV-F-1a) supported a national rule because it will be easier to

implement and enforce. One of these commenters (IV-D-161)

supported the national architectural coating VOC rule because it

will provide consistency regarding compliance among States for

VOC control. The commenter specifically supported a national

rule that will help to alleviate the difficulty manufacturers

encounter in controlling distribution so that products are not

shipped to areas where the product does not meet a local VOC

content limit. Another commenter (IV-D-151) stated that a

national architectural coatings VOC rule is desirable because it

allows manufacturers to sell and distribute products freely among

attainment and nonattainment areas. This commenter also

supported a national architectural coatings VOC rule because it

would simplify recordkeeping. One commenter (IV-D-30) stated a

concern that without a national rule, companies would be subject
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to several State and Federal requirements that would unduly

complicate doing business in the architectural coatings industry. 

Another commenter (IV-F-1j) faces marketing and logistical

problems because of the various architectural coating VOC rules

and rule variations across the country. 

Response: The EPA agrees that implementation of a national

rule will help to minimize the patchwork of potentially diverse

regulations across the nation. Several industry representatives

have advised the EPA that the cost of producing different product

lines for attainment versus nonattainment areas, as could happen

under a non-nationwide rule or CTG approach, could be cost

prohibitive because of the duplicative effort of labeling,

storage, and distribution management. The EPA also recognizes

and agrees that an added benefit of uniform national rules is

that State resources can be redirected to other local regulatory

development efforts to reduce emissions that contribute to ozone

or other pollutants within a particular State. Therefore, the

EPA agrees that using a national rule to control VOC emissions

from architectural coatings may be more cost-effective than other

alternatives for specific categories of products like

architectural coatings. The EPA notes, however, that even with a

national rule for architectural coatings, some areas may choose

to impose additional regulations to obtain greater VOC reductions

as their circumstances may require, and that section 183(e) of

the Act permits this. 

Comment: One commenter (IV-D-96) stated that a national VOC

rule for architectural coatings will play a role in diminishing

the amount of precursor VOC transported from ozone attainment

areas into nonattainment areas throughout the country. 

Response: The EPA believes that national rules with

nationwide applicability may help to mitigate the impact of ozone

and ozone precursor transport across some area boundaries. 

Recent modeling performed by OTAG and others suggests that in

some circumstances VOC emitted outside nonattainment area

boundaries can contribute to ozone pollution in nonattainment

areas -- for example, by traveling relatively short distances
2-49

into neighboring nonattainment areas. The EPA has recognized the

potential for VOC transport in the December 29, 1997, Guidance

for Implementing the 1-hour Ozone and Pre-Existing PM NAAQS 10 

concerning credit for VOC emission reductions towards rate of

progress requirements. The guidance indicates that the EPA may

give credit for VOC reductions within 100 kilometers of

nonattainment areas. In addition, the June 1997 recommendations

made by OTAG supported the EPA’s use of VOC regulations that

apply to both nonattainment and attainment areas to implement

section 183(e) of the Act for certain products. The particular

product categories OTAG cited for national VOC regulations are

automobile refinish coatings, consumer products, and

architectural coatings. The EPA believes that regulation of

products in attainment areas is necessary to mitigate VOC

emissions that have the potential to contribute to ozone

nonattainment in accordance with section 183(e) of the Act. The

EPA has taken this into account as one of the reasons for

selecting a nationwide VOC rule, rather than a regulation or CTG

applicable only in nonattainment areas.

Comment: Two commenters (IV-D-32, IV-F-1a) stated that a

national architectural coating VOC rule will reduce the potential

for consumers or others transporting noncompliant products from

attainment areas into nonattainment areas.

Response: The EPA agrees with the point raised by these

commenters and maintains that regulating manufacturers’ and

importers’ products in both attainment and nonattainment areas is

a more effective approach for reducing emissions from

architectural coatings because these products are easily

transportable and widely distributed to consumers for use in

unlimited locations. The transportability of products tends to

decrease rule effectiveness for rules that vary by location due

to the likelihood of unregulated, non-compliant products being

bought in attainment areas and used in nonattainment areas. For

this reason, effective enforcement of a control strategy for an

architectural coatings rule that affected nonattainment areas

only would be limited. Therefore, the EPA is promulgating the
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standards for architectural coatings as a national rule. A

national architectural coating VOC rule will eliminate the

potential for transport of non-compliant products from attainment

areas into nonattainment areas that would negate the

effectiveness of the rule to achieve VOC emission reductions.

Comment: One commenter (IV-D-32) argued that a national

rule for architectural coatings would help prevent future ozone

problems in attainment areas. 

Response: The EPA agrees that one incidental benefit of the

architectural coatings rule will be reduction of ozone and ozone

precursors nationwide including maintenance areas. For areas

that previously had been nonattainment areas, States are required

to have a plan to demonstrate maintenance of the ozone standard

over the long term. Population growth or increased economic

prosperity would be expected to lead to additional use of these

products, which in turn, could lead to increased VOC emissions. 

The EPA notes that the purpose of the rule is to obtain VOC

emission reductions from products that have the potential to

contribute to ozone nonattainment, and this goal is furthered by

the final rule. The potential benefits for maintenance areas are

incidental to this goal. 

Comment: Two commenters (IV-F-1g, IV-F-1o) contended that

other provisions in the Act, besides section 183(e), place

significant pressures on the States to achieve large reductions

of VOC emissions by 1996 and beyond, and inevitably would have

subjected architectural coating products directly and indirectly

to a host of inconsistent State rules. 

Response: The EPA agrees that many existing nonattainment

areas have identified architectural coatings as a significant

source of VOC emissions in their strategies to reduce emissions

to attain the ozone NAAQS. As a result, architectural coatings

could be regulated by inconsistent State and local rules. The

EPA expects the final rule to reduce the need for such State and

local rules and promote uniformity and consistency.

Comment: Nine commenters (IV-D-30, IV-D-117, IV-D-129,

IV-F-1g, IV-F-1i, IV-F-1j, IV-F-1n, IV-F-1o, IV-F-1s) supported a
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national rule because it will provide uniform regulations

throughout the country, minimizing the effects of the current

patchwork of architectural coating regulations. According to the

commenters, uniform regulations are in the best interest of the

entire industry. 

Three commenters (IV-D-189, IV-F-1i, IV-F-1o) urged the EPA

to utilize its powers under the Act in a way that will promote

consistency of regulation. However, one commenter (IV-F-1e)

noted that the States will still have the option of reducing the

limits further and pointed to California as an example. The

commenter asked how the EPA is going to ensure that the States

will not use the EPA guidelines as a baseline and reduce VOC

content levels further to obtain more reductions. The commenter

asked what the economic impact to the industry would be if the

States further reduced VOC content levels and stated that the EPA

had not addressed this issue. 

One commenter (IV-D-30) stated that it is disadvantageous to

have different VOC content limits in attainment areas and

nonattainment areas. To promote uniformity, the commenter urged

the EPA to publish a national architectural coatings VOC rule

with VOC content limits that are stringent enough to address the

need for VOC reductions for as many States as possible.

One commenter (IV-F-1g) noted that the lack of a national

rule for architectural coatings made planning for new coating

products, for production, for expansion, and for marketing very

difficult if not impossible. Another commenter (IV-F-1i) stated

that the most difficult situations for small companies to deal

with are a large number of States having different regulations

and a regulatory climate that changes frequently. For example, a

large number of States have different labeling requirements. The

commenter noted that when two States specify different wording

for the labels, the manufacturer has to track and have two

entirely different sets of labels. The commenter requested a

national architectural coating rule that preempts State

requirements across the board. At the very least, the commenter

requested that States be required to adhere to the Federal
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product categories and definitions that are consistent with the

national regulations and be prohibited from requiring specific

legal language that must appear on the label. 

Another commenter (IV-F-1o) noted that several States

completed or started architectural coating VOC rulemakings and

others have announced that they plan to issue architectural

coating rules if the EPA fails to issue a timely national

architectural coating rule. This commenter encouraged the EPA to

emphasize to the States a preference under section 183(e) of the

Act for a uniform national rule. The commenter noted that while

acknowledging the authority of the States to act independently,

section 183(e) of the Act also requires that they first consult

with the EPA before developing rules that differ from the

national rule. The commenter contended that Congress wanted the

States to deliberate carefully on this and urged the EPA to add

language to the preamble of the architectural coating VOC rule to

explain this provision. The commenter also asked the EPA to

encourage States to make their rules as consistent with the

national rule as possible.

Another commenter (IV-D-189) urged the EPA and States to

collaborate cooperatively to reconcile any differences between a

national rule and any State VOC rules for architectural coatings. 

The commenter elaborated that State regulations such as "Rule 66"

(South Coast Air Quality Management District) should be included

within this collaborative effort.

Response: The EPA agrees that the main purpose of rules

promulgated under section 183(e) of the Act is to reduce VOC

emissions effectively and efficiently in nonattainment areas

utilizing “best available controls.” An incidental benefit of

regulations that apply both in attainment and nonattainment

areas, however, is that they promote consistency in regulations,

thereby reducing the burden on manufacturers of complying with

differing State standards. To date, the EPA believes that

consistency has already been promoted because many States that

intended to develop their own regulations for architectural

coatings have instead relied on the final rule developed by the
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EPA. However, the EPA does not expect regulations issued under

section 183(e) of the Act to provide complete uniformity in

requirements across the country for architectural coatings

because some States may continue to need more stringent standards

to meet their air quality goals. The consultation provisions of

section 183(e)(9) of the Act are designed to promote uniformity

in the event that States or local areas need to adopt

requirements more stringent than those promulgated by the EPA. 

This section requires the EPA to maintain and provide relevant

information, studies, and regulations proposed and promulgated to

any State or local government that requests it. The EPA expects

this service to help States consider options for regulation that

will be consistent with those existing in other States or local

subdivisions. The EPA anticipates that the promulgation of a

national rule may minimize the need for additional States to

enact architectural coating rules. The EPA does seek to

encourage uniformity in regulations nationwide, but recognizes

that some areas may continue to need more stringent regulations

in order to alleviate ozone nonattainment conditions within their

jurisdictions, especially those areas with significant ozone

nonattainment problems of long duration. The EPA notes that

section 183(e) does not preempt any State regulations and that

this reflects the intent of Congress to permit more stringent

State rules where deemed necessary by those States.

2.1.3 Miscellaneous

Comment: Two commenters (IV-D-183, IV-F-1q) contended that

the best approach for reducing VOC from architectural coatings

would be no architectural coating VOC rule at all. One commenter

(IV-D-183) asserted that since the 1950s, VOC emissions from

paint have continually decreased because technology has improved

and consumers demanded water-reducible products. The commenter

contended that this decline in emissions will continue given the

opportunity and resources without the motivation of VOC limits on

coatings. The other commenter (IV-F-1q) expressed concern that a

VOC rule for architectural coatings may prohibit development of
2-54

new coatings that may contain more VOC but last longer and,

therefore, do not require repainting as frequently. 

Response: The EPA does not believe that a VOC rule will

increase emissions or inhibit development of new technologies. 

To the contrary, the EPA maintains that such VOC content limits

will provide guidance on achievable VOC levels to manufacturers

that have not yet reformulated their coatings with currently

available resin technology. In fact, the EPA contends that

required VOC content limits will encourage the development of

alternative technologies, such as the newly emerging reactive

diluent technology. Reactive diluent coatings result in lower

VOC emissions because most of the organic solvents chemically

react to become part of the finished coating rather than

evaporating into the ambient air to contribute to ozone pollution

problems. 

The EPA also believes that the behavior of manufacturers in

developing lower VOC coatings and the public’s acceptance of

those products have occurred in conjunction with, and in part

because of, regulatory limits placed on the products in some

States. The EPA sees no indication that the market would have

moved at the same speed or to the same extent without the impetus

of State and local environmental regulations. Thus, the EPA

concludes regulating architectural coatings on a national level

will help to further direct market forces to lower VOC

technology.

Comment: Two commenters (IV-D-129, IV-F-1s) stated that a

national VOC rule for architectural coatings will improve the

safety of the work environment. One coatings manufacturer

(IV-F-1s) stated that his company changed to lower VOC products

not because of the VOC rule for architectural coatings but

because of customers who wanted to buy products for use in plants

without having to install control equipment to meet local work

place health and safety regulations. For example, the

commenter's customers do not have to buy an emissions control

system for their wood furniture manufacturing shop if they can
2-55

buy low VOC products that enable them to reduce VOC without

additional shop controls. 

Response: The EPA agrees that incidental benefits of a

national VOC rule for architectural coatings may include

improvements in the workplace environment by reducing worker

exposure to toxic solvents. The EPA expects that adoption of the

national architectural coating VOC rule will sometimes result in

solvents with greater toxicity characteristics being replaced

with solvents of lower toxicity. For example, the EPA expects

the amount of xylene, a toxic solvent, used in coatings to

decrease and the amount of water, a non-toxic solvent, used in

coatings to increase. 

The EPA agrees that the regulatory environment encourages

lower VOC technology. However, the architectural coating rule

does not apply to coatings applied as part of manufacturing a

product such as wood furniture. The EPA has clarified this by

excluding shop-applied coatings from the architectural coating

definition. This section of the final rule provides that this

regulation does not apply to products used in manufacturing

facilities. The EPA notes, however, that the availability of

products with lower VOC content may aid manufacturers who seek to

reduce worker exposures to VOC emissions.

2.2 PROPOSED STANDARDS

2.2.1 Applicability of the Standards

2.2.1.1 General

Comment: One commenter (IV-D-189) strongly endorsed

community-based paint exchange programs. However, the commenter

stated that there is some ambiguity between the exemption of

paint exchanged in these programs and the proposed rule provision

that provided VOC credits to manufacturers for recycled coatings.

Specifically, the commenter noted that it is unclear whether all

of the coatings collected in a community-based paint exchange

program that are subsequently recycled by a manufacturer would be

entirely exempt or whether these coatings would be subject to the

rule provisions relating to recycled coatings. 
2-56

Response: The exemption for coatings collected at a paint

exchange (§ 59.400(c)(4)) is not intended to apply to

manufacturers. As described in the proposal preamble:

Community-based paint exchanges are programs in which the

general public may drop off and pick up post-consumer

architectural coatings (leftover paint), typically free of

charge, and thereby reduce household hazardous waste. The

exchanges occur between users and not manufacturers. Even

though these coatings may be repackaged and the proposed

regulatory definition of "manufacturer" includes

repackagers, repackaging that occurs at community-based

paint exchanges is specifically excluded from the

definition.

The exemption for coatings distributed in a paint exchange is

meant to apply to coatings that are not reprocessed by a

manufacturer, and therefore, virgin materials such as solvent and

resins are not added to the coatings. Consequently, any coatings

collected by a manufacturer would be subject to the recycled

coating provision detailed in § 59.406. The recycled coatings

provision applies to unused coatings that have been previously

purchased by a consumer, and are subsequently combined with

virgin materials by a manufacturer and are offered for sale as a

recycled coating.

To clarify the EPA’s intent that the exemption for coatings

collected at a paint exchange is not intended to apply to

manufacturers, the EPA has modified the definition of communitybased paint exchange as follows:

“Community-based paint exchange means a program in which

members of the general public, excluding architectural

coating manufacturers and importers, may drop off and pick

up usable post consumer architectural coatings in order to

reduce household hazardous waste.”

Comment: One commenter (DoD Steering Committee representing

the Army, Navy and Air Force as well as several DoD components

and agencies) (IV-D-121) recommended that an exemption be given

to any “paint exchange” activity that actively reduces the

hazardous waste stream. For example, the Navy reportedly has

been phasing in a Consolidated Hazardous Material Reutilization

and Inventory Management Program (CHRIMP), and the other services
2-57

reportedly have similar programs. The objective of CHRIMP is to

provide life cycle management of hazardous materials with the

intent of reducing hazardous waste. Hazardous Minimization

Centers (HAZMINCEN) are set up to centrally control all hazardous

materials. All work centers within the command or activity, and

tenant commands who participate in the program are required to

turn in hazardous materials currently held and to use the

HAZMINCEN for all future needs. The HAZMINCEN, in turn, responds

to customer requests by packaging, repackaging, and/or issuing

(or distributing) the quantity of hazardous materials required to

perform the task at hand. When the work is completed, the

customer will return any unused portion of the hazardous

materials, and the original container, to the HAZMINCEN. Center

personnel will examine the returned hazardous materials and

determine if the unused portion can be retained for reuse by

another customer, if it can be recycled, or if it should be

disposed of as hazardous waste by the appropriate agency. The

commenter did not believe that the EPA intended to regulate such

operations and recommended that the second sentence of the

definition of “architectural coating manufacturer or

manufacturer” be revised to read: “A person who repackages

architectural coatings as part of a community or industrial-based

paint exchange, and does not produce, package, or repackage any

other architectural coatings for sale or distribution in the

United States, is excluded from this definition.” 

Response: The EPA agrees that it did not intend to regulate

any paint exchanges such as those described by the DoD

representative. Thus, the EPA has amended the second sentence of

the definition of manufacturer as follows: “A person who

repackages architectural coatings as part of a paint exchange,

and does not produce, package, or repackage any other

architectural coatings for sale or distribution in the United

States, is excluded from this definition....” Along with this

change, the EPA has also changed the term “Community-based paint

exchange” in the Definitions section of the final rule to “Paint

exchange” to accommodate paint exchanges other than community-
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based ones and, thus, the definition has been revised as follows: 

“Paint exchange means a program in which consumers, excluding

architectural coating manufacturers and importers, may drop off

and pick up usable post-consumer architectural coatings in order

to reduce hazardous waste.” As discussed in the previous

response, the exemption for coatings distributed in a paint

exchange is meant to apply to coatings that are not reprocessed

by a manufacturer and, therefore, virgin materials such as

solvent and resins are not added to the coatings.

Comment: One commenter (DoD Steering Committee representing

the Army, Navy and Air Force as well as several DoD components

and agencies) (IV-D-121) requested clarification that

“manufacturer” in the proposed rule does not include any

repackaging and internal distribution activities within the DoD,

and that “importer” does not include purely internal distribution

activities. The commenter cited the proposed definition of

“architectural coating manufacturer or manufacturer as a company,

group, or individual that produces, packages, or repackages

architectural coatings for sale or distribution in the United

States....” The commenter also cited the definition of

“repackaging as transfer of an architectural coating from one

container to another container for sale or distribution in the

final container.” The commenter argued that, as proposed, these

definitions could lead to the unintended regulation of packaging,

repackaging, and distributing activities in both the government

and private sector. According to the commenter, the DoD

purchases bulk quantities of material (for purposes of economies

of scale) and distributes these materials internally through

various agencies. These agencies may also transfer materials

such as coatings from one container to another (from a large

container to a smaller container for immediate use) during these

transactions. To exclude these types of activities, the

commenter requested that the EPA clarify that “for sale or

distribution” does not include such internal transfers within DoD

or any other Federal agency even if such transfers include some

amount of repackaging and recommended adding the following
2-59

definition: “Architectural coating held by a government. An

architectural coating that is held by a government for its own

use is not held for sale or distribution even if the coating will

be repackaged and/or transferred between agencies or other

subdivisions of the agency.” The commenter noted that a similar

clarification was made in the final rule for Excise Tax on

Chemicals that Deplete the Ozone Layer and on Products Containing

such Chemicals, 26 CFR Parts 52 and 602. The commenter suggested

that another approach would be to revise the definition of

manufacturer to target the sources to be regulated as formulators

and reformulators rather than producers, packagers, and

repackagers. Finally, the commenter also recommended adding to

the definitions of manufacturer and importer the qualifying

phrase “in interstate commerce” as in the statutory definition of

regulated entities in section 183(e) to prevent the rule from

regulating the DoD as a manufacturer or importer of architectural

coatings.

Response: The EPA did not intend that the military or other

consumers that perform only repackaging and/or distribution of

architectural coatings for internal use be regulated under the

architectural coatings rule. Therefore, to clarify that “for

sale or distribution” does not include such internal transfers,

the definition of manufacturer in the final rule has been amended

by adding a third sentence; a fourth sentence has also been added

for further clarification of applicability as follows: 

Manufacturer means a person who produces, packages, or

repackages architectural coatings for sale or distribution

in the United States. A person who repackages architectural

coatings as part of a paint exchange, and does not produce,

package, or repackage any other architectural coatings for

sale or distribution in the United States, is excluded from

this definition. A person who repackages a coating by

transferring it from one container to another is excluded

from this definition, provided the coating VOC content is

not altered and the coating is not sold or distributed to

another party. For purposes of applying this definition,

divisions of a company, subsidiaries, and parent companies

are considered to be a single manufacturer.

 Similarly, the definition of Importer has been amended as

follows:
2-60

Importer means a person who brings architectural coatings

into the United States for sale or distribution within the

United States. This definition does not include any person

who repackages a coating by transferring it from one

container to another, provided the coating VOC content is

not altered and the coating is not sold or distributed to

another party. For purposes of applying this definition,

divisions of a company, subsidiaries, and parent companies

are considered to be a single importer.

 

The EPA does not believe it is necessary to add the

suggested phrase “in interstate commerce” to the definitions of

manufacturer and importer in the final rule for further

clarification to address this issue.

It should also be noted that EPA is using the term "person"

in lieu of "company, group, or individual" in these definitions

because the Agency believes this term is more appropriate. A

definition of person has been added to the final rule.

Comment: One commenter (IV-G-13) requested clarification in

the final rule that after the effective date of the rule, a

coating manufacturer could “containerize” products manufactured

prior to the effective date. The commenter stated that

architectural coatings are frequently manufactured for customers

with seasonal needs in advance of when the coatings will be used. 

The coating is stored in tanks at the manufacturer’s premises

until needed by customers at which point it is placed into a can,

drum, or tote. Frequently, the drums or totes are reusable and

the end user might purchase a tank of coating and then return to

refill its containers until the tank is depleted. The commenter

noted that the proposed rule does not define “manufacturing.” In

the commenter’s opinion, coatings are completely manufactured

once they have been formulated and placed into storage. In other

words, the commenter believes that if a coating is manufactured

prior to the effective date of the architectural coating rule and

placed into a properly labeled bulk storage tank, then the

coating can be placed into end-use containers after the effective

date, regardless of whether the coating meets applicable VOC

content limits. The commenter does not believe this approach

conflicts with the definition of “manufacturer,” since that term
2-61

was defined broadly to include all possible parties that could be

involved in labeling and distributing coatings. The commenter

asserted that defining manufacturing to include all

containerization steps would make the rule difficult to implement

because a manufacturer would have to close out all of its storage

capacity by the effective date and ensure that all product is

containerized.

Response: The EPA does not intend the rule to prevent the

process described by the commenter. The coating manufacturing

process includes the mixing or agitation of resins (or binders),

solvents, pigments, and other components to form an architectural

coating, which is then stored in containers at the manufacturer's

premises for sale or distribution. A coating that is

manufactured prior to the compliance date (1 year after

publication of the rule in the Federal Register) of the

architectural coating rule and placed into bulk storage tanks

from which customers fill and refill cans, drums, or totes until

the tank is depleted would not be subject to the rule. A

definition of the term “manufactured” has been added to the rule

to clarify the point at which a coating is considered to be

manufactured for purposes of this rule. It is when the coating

ingredients have been combined and put into containers that have

been labeled and made available for sale or distribution. A

container is defined in the rule as the individual receptacle

that holds the coating for storage and/or distribution. 

Therefore, if a coating is put into a storage container such as

that described by the commenter before the compliance date, then

it is not subject to the requirements of the rule. However, the

container contents would become subject to the rule with any

addition of coating to the container after the compliance date.

Comment: One commenter (IV-G-15) requested clarification in

the final rule that after the effective date of the rule, a

coatings manufacturer could aggregate coatings manufactured prior

to the effective date, agitate the coatings, adjust viscosity,

and return the coating to the field for use. According to the

commenter, some coatings manufacturers distribute the coatings in
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large reusable totes, and sometimes it will be months before a

tote is returned for reuse. When totes are returned, they

typically contain approximately 30 gallons of coating. The

returned coating is normally returned to the manufacturing

process and ultimately distributed as new coating. The commenter

was concerned that after the effective date of the rule, this

procedure will not be permitted. However, the commenter noted

that it would be possible to aggregate the coating that is

returned and, after agitation and viscosity adjustment,

distribute the coating in refilled totes. Otherwise, the

commenter noted that the returned coating would be sent to a

hazardous waste incinerator with the residue ultimately deposited

in a landfill, which does not seem to be in the best interest of

the environment. The commenter's concern is that the aggregation

of manufactured coatings, agitation of the aggregated coatings,

and adjustment of viscosity by adding solvent might be viewed as

manufacturing, even though the product has already been

manufactured and is essentially only being thinned to allow its

use rather than disposal.

Response: The EPA believes that the commenter can continue

the process it described by treating the coating as “recycled.” 

After the compliance date of the rule (1 year after the rule is

published in the Federal Register), manufacturers or importers of

"recycled" architectural coatings can collect, reprocess, and

market coatings that contain a percentage of post-consumer

coating product. Such use is environmentally beneficial because

it reduces the magnitude of waste from architectural coatings. 

Manufacturers and importers of recycled coatings are given the

option of calculating an adjusted VOC content. The adjusted VOC

content provides some credit for the amount of post-consumer

material contained in the coating. The EPA is providing this

credit to encourage recycling of unused paint. The adjusted VOC

content is determined by multiplying the percentage of postconsumer content of the coating by the VOC content of the

recycled coating, which can then be subtracted from the VOC
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content of the recycled coating. An explicit equation for the

calculation is in the final rule.

Comment: Two commenters (IV-D-161, IV-D-206) supported the

exemption for coatings sold in non-refillable aerosol containers. 

Response: The EPA has retained this exemption in the final

rule. Aerosol paint is considered a specialty paint product and

typically involves a specialized division within a paint company. 

In addition, it is a complex product category due to the many

subcategories of aerosol paint, and the range of options to

reformulate include the potential to change propellant

formulations. Therefore, the EPA plans to address coatings sold

in non-refillable aerosol containers separately under

section 183(e) authority.

Comment: One commenter (IV-D-171) maintained that its line

of gypsum or cement-based, spray-applied cementitious fire

protection products should be exempt from the rule because the

products do not meet the definition of a “coating.” 

Specifically, the commenter stated that these products do not

meet the definition of a coating because they are not applied in

a "film" as that term is used in the paint and coatings industry. 

The commenter indicated that end users mix these products into a

slurry and spray-apply them to steel building surfaces during

construction or renovation. These products are applied to

specified thicknesses typically from 1/2 to 1-1/2 inches but may

range from 5/16 to 3-1/2 inches in unique applications. These

products are often necessary for the buildings in which they are

applied in order to comply with Federal, State, or local building

code requirements. In order for a building to meet the

applicable code, the depth specified by architects and engineers

is strictly followed. The commenter reasoned that coatings of

this thickness are not a film and that their products are,

therefore, excluded from the rule.

Response: The EPA disagrees that the coatings, as described

by the commenter, should be exempt from the rule. To clarify

what is meant by a coating, the EPA has modified the definition

of coating in the final rule to read as follows: “Coating means
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a material applied onto or impregnated into a substrate for

protective, decorative or functional purposes. Such materials

include, but are not limited to, paints, varnishes, sealants,

inks, maskants, and temporary coatings." The EPA has removed the

reference in the definition to application as a film because the

EPA did not intend to limit rule applicability based upon the

product thickness as applied. Consequently, based on the

commenter’s description of the line of gypsum or cement-based,

spray-applied cementitious fire protection products, these

products would fall under the fire-retardant/resistive coating

category. These products would be subject to a VOC content limit

of 450 grams of VOC per liter of coating thinned to the

manufacturer’s maximum recommendation excluding the volume of any

water, exempt compounds, or colorant added to tint bases. 

Comment: Two commenters (IV-D-134, IV-F-2) requested

clarification of the rule’s applicability to coatings recommended

for architectural uses and non-architectural uses. One commenter

(IV-D-134) expressed concern that a coating formulation that

meets the definition of an architectural coating may also be used

by manufacturers of aerospace parts, ships, furniture, or

miscellaneous metal parts to meet specific applications in these

industries. The commenter stated that industrial users often

depend on coating formulations to meet other CTG or National

Emission Standard for Hazardous Air Pollutants (NESHAP)

requirements that may have higher VOC levels than the limits in

the proposed architectural coating rule. The commenter suggested

that the EPA clarify that coatings provided for these regulated

manufacturing activities are not also subject to the

architectural coating rule. According to the commenter, this

would ensure that coating suppliers can provide coatings that

meet the performance requirements and regulatory levels

appropriate to each. The commenter suggested revising

§ 59.400(c) by adding a new paragraph as follows: “(6) Coatings

that are subject to the requirements of a National Emission

Standard for Hazardous Air Pollutant or Control Technology

Guideline.”
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One manufacturer (IV-F-2) was concerned about this issue

because his company markets the same coating as both a product

finish and as an architectural coating. The commenter asked

whether the sales of coatings marketed as product finishes are

subject to the rule.

Response: As stated in the definition of architectural

coatings, the rule applies to coatings recommended for field

application to stationary structures and their appurtenances, to

portable buildings, to pavements, or to curbs. Therefore, the

rule does not apply to coatings that are marketed solely for shop

application, such as in a manufacturing setting, or coatings

marketed solely for application to non-stationary structures,

such as aircraft, ships, boats, and railcars. The definition of

architectural coating has been amended in the final rule to

clarify this point. A coating that is recommended by the

manufacturer or importer for use as an architectural coating is

subject to the architectural coatings rule even if the coating is

also recommended for non-architectural uses. The fact that a

coating regulated by the architectural coatings rule may also be

subject to other rules with different requirements does not alter

the manufacturer’s or importer’s obligation to meet the

requirements of the architectural coatings rule when it

recommends use of the product as an architectural coating. 

Consequently, the EPA has not added the exemption paragraph

suggested by commenter IV-D-134 to the final rule.

Comment: One commenter (IV-D-76) inquired whether

solvent-based floor waxes and solvent-based terrazzo seals will

be regulated by the architectural coating rule. In a follow-up

conversation, the commenter (IV-E-54) described its terrazzo

sealer as "a buffable solvent-based coating consisting of 85 to

90 percent solvent and 10 to 15 percent wax that is used as a

wear surface and soil retardant for terrazzo floors." 

Response: Floor waxes, such as those described by the

commenter, are not regulated under the architectural coating

rule. Floor waxes are covered under the National Volatile

Organic Compound Emission Standards for Consumer Products in the
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floor polish or wax category. The definition of “floor coating”

in the architectural coatings rule has been modified for the

final rule and clarifies that only opaque coatings are included

in this category. Since floor waxes are not opaque floor

coatings, they are not covered by this rule. 

Comment: One commenter (IV-D-76) asked if products sold to

institutions, such as schools and municipalities, would be exempt

under the architectural coatings rule.

Response: The architectural coating rule does not contain

an exemption for coatings that are sold by manufacturers to

institutions, such as schools and municipalities. The commenter

failed to provide a rationale for adding such an exemption to the

final rule. Section 183(e) likewise does not stipulate that

there should be any such differentiation.

The EPA based VOC content limits in the rule on the best

available control given the performance requirements of the

coatings in each coating category. The performance requirements

for coatings used in institutions, such as schools and

municipalities, are similar to those encountered in other

locations, such as private office buildings and Federal office

buildings. Therefore, an exemption of coatings sold to

institutions cannot be justified on the basis of unique

performance requirements. 

Negligible emissions. 

Comment: Three commenters (IV-D-02/IV-D-178/IV-F-1(l),

IV-D-120, IV-F-1m) suggested that the EPA exempt low volume

categories that contribute negligibly to VOC emissions. One

commenter (IV-D-02/IV-D-178/IV-F-1(l)) stated that small

businesses with low volumes of production rely on their suppliers

to develop new resin systems that allow the manufacturer to

develop lower VOC coatings. As an example, the commenter

(IV-D-02, IV-F-1(l)) cited two graphic arts coatings -- bulletin

enamels and lettering enamels. The commenter reasoned that such

niche products with small markets do not justify the research

costs necessary for a replacement product with low VOC emissions. 

The commenters stated that the EPA should not issue a rule that
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might put companies out of business when their relative

contribution to the ozone nonattainment problem is small. 

Several commenters (IV-D-30, IV-D-120, IV-D-209, IV-F-1m, IV-F-2)

suggested regulating only the 15 categories that cause 90 to

95 percent of the annual aggregate VOC emissions associated with

architectural coatings. The commenters contend that this would

still achieve the purpose of the rule while causing less of an

economic impact on manufacturers. 

Response: The EPA agrees that some categories of

architectural coatings are larger contributors than others to

both VOC emissions and VOC emission reductions. The 15 largest

categories actually represent 88 percent of the emissions, or

approximately 494,000 tons, rather than 90 or 95 percent as cited

by the commenters. The remaining categories represent 12 percent

of the emissions (approximately 67,314 tons) and account for

12,702 tons of the anticipated VOC emission reductions from the

architectural coating rule (II-I-8). The EPA considers this a

significant amount of VOC emissions and reductions. To put this

in perspective, if the EPA combined these categories of coatings

into a separate category, that category would rank 16th out of

the 21 categories of all consumer and commercial products listed

for regulation under section 183(e) (on the basis of tons of VOC

emissions per year in nonattainment areas). As with all

categories of consumer and commercial products, even if no one

product has an enormous amount of VOC emissions, the EPA is

concerned with the total aggregate amount of emission reductions. 

By their very nature, individual consumer and commercial products

may not have a large impact on ozone nonattainment, but in the

aggregate, their impact is significant. This fact was one of the

motivations behind Congress’ enactment of section 183(e) of the

Act.

In developing the proposed rule, the EPA recognized that it

may not be economical for some manufacturers to reformulate

certain lower volume products. Rather than exempting these lower

volume products, the EPA proposed VOC content limits in the upper

range of VOC content limits in existing State rules for these
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categories. For categories for which no State standards exist,

the EPA included the categories in the architectural coating rule

and proposed VOC content limits based on discussions with

industry representatives and end user groups, petitions from

stakeholders prior to proposal, and public comments from

companies providing support for inclusion of the categories and a

suggested VOC content limit. Some manufacturers within these

niche markets have successfully developed lower VOC coatings in

anticipation of VOC requirements. Therefore, rather than exempt

these types of products, the final rule includes VOC limits at

levels expected to be in the upper range of VOC contents for the

particular type of product. The final rule also provides

compliance flexibility for these types of low-volume coatings in

the form of a tonnage exemption and an exceedance fee. The

tonnage exemption is designed to accommodate a limited amount of

niche category coatings for which it may not be economical for

manufacturers to devote any reformulation efforts. In addition,

the exceedance fee provides manufacturers additional time to

reformulate their coatings by allowing the manufacturer or

importer the option of paying a fee, based on the amount that the

VOC content limits are exceeded, instead of achieving the limits

in the rule. 

Comment: One commenter (IV-D-23) requested an exemption for

coatings that are essentially 100 percent solids and have only a

negligible VOC content. The composites manufactured by this

commenter are used to reinforce or improve the strength of

concrete and metal and to improve resistance to abrasion,

corrosion, and chemical attack. The commenter stated that

regulating these products as coatings creates the compliance

burden of testing, labeling, and reporting with no impact on

reducing VOC emissions. 

Response: The EPA has not created an exemption for coatings

that are essentially 100 percent solids and have only a

negligible VOC content. The EPA recognizes the concern of the

commenter that in some cases a regulatory burden could be imposed

on an architectural coating manufacturer that would not result in
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any VOC reductions. However, for manufacturers of products that

already comply, this burden would be limited to the following two

compliance requirements: (1) a one-time initial report

identifying the company and the product categories in which the

compliant products are marketed, and (2) labeling that reflects

the date of manufacture and either the VOC content of the coating

or the applicable VOC content in table 1 of the rule with which

the coating is required to comply. This limited reporting and

labeling burden is necessary to ensure effective enforcement and

to limit the need for enforcement personnel to follow-up with

manufacturers to obtain additional product information on

unlabeled coatings. Testing of the coating is not required in

the rule; the manufacturer or importer may use other means for

predicting the VOC content of the coating. (However, the

Administrator may request that manufacturers and importers

demonstrate compliance using Method 24.) Based upon the

commenter’s representation as to the VOC content of its products,

the EPA believes that the commenter will have only a limited

burden under the rule.

Comment: One commenter (IV-D-120) argued that coatings that

do not meet the definition of any specific category should not be

subject to the final rule. The commenter stated that, as

proposed, the rule provides that a coating not included in a

specific category will default to the category with the most

restrictive limit (i.e., the flat or nonflat category depending

on its gloss level). According to the commenter, coatings not in

any existing category are typically very low-volume specialty

coatings with insignificant aggregate amounts of VOC emissions. 

The commenter argued that if these coatings must be covered by

the rule, then they should be subject to the highest VOC content

limit permissible under the rule rather than defaulting to the

lower limits for the flat or nonflat category..

Response: The EPA disagrees that in the event of ambiguity,

there should be no VOC limitation whatsoever for a coating. The

EPA has attempted to create appropriate categories with specific

category descriptions to avoid situations in which it is unclear
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what category a coating falls under. As structured, the rule

encourages regulated entities to describe and categorize their

coatings accurately and minimizes the incentive for regulated

entities to subvert the rule by arguing that specific coatings do

not meet any of the definitions and, therefore, are subject to

the highest VOC content allowed. If the commenter is correct

that the coatings in question comprise only very small volumes of

sales or small amounts of VOC emissions, the final rule provides

alternative means to address this issue. The manufacturer could

use the tonnage exemption or the exceedance fee mechanisms to

alleviate potential problems with the situation described. In

addition, if the EPA determines that additional categories need

to be created in the future, the rule could be modified to add

new categories. Such an approach could be appropriate if a

category limit in fact imposes undue burden or if the EPA

determines that regulated entities are attempting to subvert the

rule through abuse of the category descriptions.

Adhesives.

Comment: Two commenters (IV-D-13, IV-D-37) requested that

the EPA modify the proposed rule to clarify that adhesives are

not regulated under the architectural coating rule. One

(IV-D-13) commenter requested confirmation that adhesives used in

the application of high pressure decorative laminate (HPDL)

counter top products to wood, wood composite, or wood fiber

substrates would not be regulated under the proposed rule. The

commenter (IV-D-13) stated that the current rule language does

not clearly exclude adhesives. Another commenter (IV-D-37)

suggested that in order to address ambiguity about adhesives, the

EPA should change the definition of traffic marking coating to

read as follows: "A coating formulated and recommended for

marking and striping streets, highways, and other traffic

surfaces including, but not limited to, curbs, driveways, parking

lots, and airport runways. It does not include adhesives for

traffic marking tape." Alternatively, the latter commenter

requested the EPA to use a definition of coating that directly

excludes adhesives. The commenter pointed out that many State
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and local architectural coating VOC rules already exclude

adhesive primers for traffic tapes from architectural coating

regulations because they are covered in adhesive rules. 

Response: The EPA did not intend to regulate adhesives of

any kind in the architectural coating rule. The EPA intends to

regulate industrial adhesives as a separate category under

section 183(e) authority at a future date. To clarify that

adhesives are not covered under the architectural coating rule,

the EPA has modified the definition of architectural coating in

the final rule to exclude adhesives. In addition, a definition

for adhesives has been added to the rule.

Shop vs. field application.

Comment: One commenter (IV-D-17) recommended that the EPA

clarify the rule to distinguish between field-applied and

factory-applied coatings. The commenter recognized that the

definition of architectural coating makes it clear that the rule

is applicable only to field applied coatings, but suggested that

this distinction should be made more apparent in the rule by

changing the title of table 1 to "Field Applied Architectural

Coating Volatile Organic Compound Content Levels."

Response: The definition of architectural coating has been

modified and a definition for shop application has been added to

the final rule to clarify that coatings recommended for

application in a shop setting or a manufacturing process are not

subject to this rule. Rather than modifying the title of table 1

as suggested by the commenter, to further clarify the EPA’s

intent, the following sentence has been added to the definition

of architectural coating:

This definition excludes adhesives and coatings recommended

by the manufacturer or importer solely for shop applications

or solely for application to non-stationary structures such

as airplanes, ships, boats, and railcars.

Comment: One commenter (IV-D-35) requested that the

definitions of architectural coating and industrial maintenance

coating be clarified to exclude industrial specialty products. 

The commenter implied that its industrial specialty products do
2-72

not fit within the EPA’s intended definition of “architectural

coating” and, therefore, should not be regulated under the

architectural coating rule. The commenter provided the following

three examples of such specialty products:

(1) 438 Teflon non-stick dry lubricant - A field-applied

suspension of solid lubricant (polytetrafluoroethylene)

bound to the surface with a binder (acrylic resin). 

Used to lubricate and protect smooth, nonporous

surfaces to repel water, prevent materials from

adhering to surfaces and reduce relubrication. Used on

slides, hoppers, bins, chutes, tanks, molds, saw

blades, door hinges, etc. Primarily sold in 1 gallon

containers, but is also available in aerosol containers

for maintenance purposes. Volatile organic compound

content = 756 g/l.

(2) 763 Rust transformer - Electrochemically converts iron

ions in rust into a receptive base for the application

of a primer and topcoat. Consists of phosphoric acid,

tannic acid, alcohol, and glycol in a water base. Used

on storage tanks, auto or truck bodies, heavy

equipment, bridges, transmission line towers, ships,

piers, structural steel, anywhere rust is destroying

metal. Primarily sold in 5 gallon or 55 gallon drums.

(3) 775 Moisture shield - A field-applied suspension of wax

that forms a nonhardening, nondrying film used to

shield metal from oxygen and moisture. Contains

petrolatum (a petroleum wax, i.e., Vaseline) and a

mineral spirit/naphtha-type solvent. Used on

electrical equipment, electric motors, and other

energized equipment, particularly low voltage

equipment. Primarily sold in 1 gallon containers and

is also available in pressurized aerosol containers for

maintenance purposes. Volatile organic compound

content = 678 g/l.

Response: It is not appropriate to exempt all industrial

specialty products from the rule. In order for a product to be

covered by the architectural coating rule, it must be a coating

and it must be recommended for field application to stationary

structures and their appurtenances, to portable buildings, to

pavements, or to curbs. A coating is defined as a material

applied onto or impregnated into a substrate for protective,

decorative, or functional purposes. Typically, coatings are made

up of resins, solvents, binders, and pigments. The EPA

historically has not considered products that contain only
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solvents, acids, and or bases to be coatings. This clarification

has been made in the definition of coating in the final rule. 

The EPA also generally does not consider products that function

wet and remain a wet film during their entire functional lifetime

to be coatings.

The EPA considers the 438 teflon non-stick dry lubricant to

be a coating because it is a material applied onto a substrate

for protective and functional purposes. The EPA also considers

the product to be an architectural coating because it is used on

the appurtenances of stationary structures such as hoppers, bins,

and tanks. Specifically, the product would be classified in the

industrial maintenance coating category, due to its exposure to

repeated heavy abrasion, and would be subject to a VOC content

limit of 450 g/l.

The EPA does not consider the 763 rust transformer to be a

coating because it is composed only of solvents and acids. 

Therefore, this product would not be covered under the

architectural coating rule.

The EPA does not consider the 775 moisture shield to be a

coating because it remains wet throughout its functional

lifetime. The functionality of this product is similar to that

of heavy oils used to protect metal from rust during storage and

shipment, which historically have not been considered by the EPA

to be coatings for regulatory purposes. Therefore, the

determination that the moisture shield is not a coating is

consistent with other EPA actions.

Applicability determinations for products not specifically

addressed in response to public comments summarized in this

document will be made by the EPA Regional Office responsible for

implementation and enforcement on a case-by-case basis so that

the particular composition and functionality of the product and

application involved can be considered.

Comment: One commenter (IV-D-140) questioned the

applicability of architectural coating rule requirements to a

line of vermiculite products, including MicroLite vermiculite

dispersions. The commenter represented MicroLite as an aqueous
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dispersion of vermiculite that is a mostly inorganic,

non-metallic, naturally occurring mineral. The commenter noted

that there may be trace levels of citrate, but no other organic

content. The products are not intended for use as architectural

coatings and they are not applied directly to architectural

structures. However, the products may be applied for fire

retardant purposes to textiles that then are used as a mastic or

facing material for an architectural structure. Specifically,

the commenter inquired whether these products were required to

meet architectural coating labeling requirements. 

Response: Based on the commenter’s description, these

products would not be subject to the architectural coating rule

requirements since the products are not intended for use as

architectural coatings and are not applied directly to

architectural structures. 

Comment: One commenter (IV-D-76) asked whether the rule

will exempt solvents such as acetone and methyl siloxanes.

Response: The architectural coating rule controls emissions

of VOC from architectural coatings. The definition of VOC in the

rule cross-references the VOC definition in 40 CFR 51.100. The

current definition of VOC in 40 CFR 51.100 exempts acetone and

methyl siloxanes. Therefore, these compounds are not regulated

by the architectural coating rule.

Comment: One commenter (IV-D-189) expressed concern that

the proposed rule provided no exemption for coatings that are

registered under the FIFRA. The commenter stated that these

coatings, to the extent that they are inconsistent with the

national rule's requirements, will have to go through another

FIFRA registration incorporating the requirements of the national

rule. Because of the length of time and complexity of getting

FIFRA registration, the commenter recommended that a provision

exempting coatings for which a FIFRA registration has been

applied be included in the final rule. To accomplish this

exemption, the commenter recommended that the following be added

as § 50.400(c)(6): 
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(6) Until an amended registration is complete, the

provisions of sections 59.400-407 shall not apply to

any coating currently registered under the Federal

Insecticide, Fungicide, and Rodenticide Act (7 USC 136

et seq.) for which an amended registration is filed,

provided the following conditions are met:

(i) Within 6 months after the promulgation of this rule,

the registrant or manufacturer has filed a complete

application for an amendment to the registration with

all formulation, labeling, and all data requirements

necessary to amend the registration and needed to meet

the VOC content limits prior to the date the VOC limits

become effective.

(ii) Proof of such filing is submitted to the EPA within one

month of the date of the filing.

(iii) All responses to the EPA's requests for additional

information (or changes to the label or other

information requiring another submittal) must be

submitted within 90 days of the EPA's request.

This exemption becomes void and the previously exempt

products can no longer be manufactured nor imported

if the registrant fails to complete all conditions

shown above and/or when the EPA turns down the

amendment application.

Response: For coatings that are registered under FIFRA for

which the manufacturer or importer must obtain an amended FIFRA

registration incorporating the requirements of this rule, the

final rule provides a compliance period of 18 months after

promulgation of the rule; this is six months longer than the

compliance period for all other architectural coatings. In the

decision to allow the 18-month compliance period, the EPA

considered the commenter’s suggestion to allow 6 months after

promulgation of this rule to submit a completed application for

FIFRA registration for coatings subject to FIFRA. The EPA

believes that the 18-month compliance period provided for

coatings subject to FIFRA allows adequate time for the entire

FIFRA submittal and approval process for obtaining an amended

registration for these coatings before they become subject to the

architectural coatings rule. The manufacturer or importer may be

required by enforcement personnel to provide proof that an
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application for an amended FIFRA registration is being filed or

has been filed.

Import/export.

Comment: One commenter (IV-D-189) was concerned about the

proposed wording of the exemption of exported coatings in

§ 59.400(c)(1) of the rule. The commenter stated that by

requiring that the coating be manufactured exclusively for

export, the exemption would not apply to situations in which

Congress intended it to apply. For example, the commenter

asserted that a manufacturer might produce a coating both for

export as an architectural coating and for distribution in the

United States for a purpose other than that of an architectural

coating. The commenter believes that a strict reading of the

exemption terms in the proposal would disqualify this product

from the exemption. The commenter recommended deleting the word

"exclusively" from § 59.400(c)(1) of the proposed rule.

Response: The EPA recognizes the commenter’s concern that

manufacturers should be able to export a coating for use in

architectural coating markets abroad and still market that same

coating for alternative purposes in the United States. In

recognition of this possible scenario, the EPA has amended the

exemption provision in § 59.400(c)(1) of the rule as follows: 

“(1) A coating that is manufactured for sale or distribution to

architectural coating markets outside the United States; such a

coating must not be sold or distributed within the United States

as an architectural coating.” 

The EPA does not anticipate that many products will qualify

for this disparate treatment abroad and domestically. If the EPA

determines that this exemption is abused as a means of subverting

the regulation, the EPA will re-examine this question.

Comment: One commenter (IV-D-28) requested that the EPA

clarify what is meant by "imported for sale or distribution in

the United States." Specifically, the commenter asked how the

rule applies to the non-contiguous States, Puerto Rico, Virgin

Islands, District of Columbia, Guam, and American Samoa. The

commenter pointed out that narrow definitions would leave
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loopholes allowing non-compliant products in the United States by

circuitous channels.

Response: It is the EPA’s intent that the rule will apply

not only in the 50 States, but in all the U.S. territories as

well. The definition of “State” in section 302(d) of the Act,

which provides definitions that are generally applicable in the

Act, includes U.S. Territories. To make this clear, a definition

of United States has been included in the final rule.

Comment: One commenter (IV-D-21) questioned how the

proposed rule affects coatings sold to domestic customers who

resell them to other countries. Specifically, the commenter

wanted to know if high VOC products could be invoiced and shipped

to domestic purchasers as long as they were marked for export. 

Also, the commenter asked what will be required for export

marking. 

Response: There are no labeling or certification

requirements for architectural coatings that are exported for use

outside the United States. However, because enforcement of the

architectural coating rule is expected to include shelf checks of

coatings, it may be advisable for a manufacturer to label

products intended for export as such. This would minimize the

paperwork that a manufacturer would have to produce to show that

these products are intended for export, if the product were to be

checked by an EPA inspector. Similarly, for the situations

described by the commenter where a manufacturer invoices and

distributes non-compliant products to domestic points for

subsequent export, it is advisable to include labeling or at

least paperwork identifying these products for export. In this

way, enforcement personnel can readily identify that the

architectural coating rule does not apply to these products. As

stated earlier, if the EPA determines that the exemption in

§ 59.400(c)(1) of the final rule is abused as a means of

subverting the regulations, the EPA will re-examine this

question.

Comment: Two commenters (IV-D-28, IV-F-1b) supported

provisions that would explicitly exempt stocks of non-compliant
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products manufactured prior to final rule promulgation. One

commenter (IV-F-1b) favored allowing such products manufactured

prior to the compliance date to be sold after the compliance

date. The commenter believed there is no real air pollution

benefit to outlawing these products and there is a tremendous

economic and waste disposal savings by not prohibiting their

sale.

Another commenter (IV-D-28) pointed out that the rule may

cause certain coatings to become obsolete. In addition, stocks

of multi-component non-compliant products may need to be

rebalanced (replenished) if more of some components are available

than others. The commenter suggested that the rule allow

manufacturers to donate obsolete stock to charitable projects and

to allow manufacturers to replenish existing non-compliant stock

volumes of multi-component products. The commenter suggested

that the EPA could implement a procedure for manufacturers to

notify the EPA of their intent to replenish stocks of components

for non-compliant coatings. To prevent deliberate misuse of such

a provision, the commenter suggested that the replenishing could

be limited to less than 20 percent of the remaining inventory of

such a coating. The commenter pointed out that this provision

would be temporary because stocks of components for non-compliant

coatings needing replenishing would fall to zero after a few

years. 

Response: The rule regulates the VOC content of

architectural coatings manufactured or imported on or after the

compliance date (1 year after publication of the rule in the

Federal Register). Any product manufactured prior to the

compliance date, whether compliant or non-compliant, can be sold

after the compliance date until the stock is depleted. As the

commenters stated, allowing non-compliant products manufactured

prior to the compliance date to be sold after the compliance date

will provide a significant economic and waste disposal savings.

The EPA does not see the need for a specific provision to

allow manufacturers to replenish existing non-compliant stock

volumes since the particular components needed to replenish
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existing stocks of multi-component coatings can be manufactured

after the compliance date of the rule using the tonnage exemption

or the exceedance fee provision or both. Similarly, obsolete

coating system components such as primers can continue to be sold

using the tonnage exemption or the exceedance fee or both. The

alternatives suggested by the commenter would be difficult to

administer or enforce and would have the potential to delay

development of compliant coatings.

Comment: One commenter (IV-D-76) requested clarification on

whether States will still be able to enforce VOC content limits

that are more stringent than those in the architectural coating

rule. 

Two commenters (IV-D-188, IV-D-191) requested that the EPA

expressly state that the Federal rule establishes a minimum

national standard that may be strengthened locally where

necessary. One commenter (IV-D-191) noted that the rule should

represent a national "floor" and not a "ceiling." The commenter

explained that preemption would have a profound negative effect

in heavily polluted areas where manufacturers have been

accustomed to stricter standards. The commenter explained that

in some areas of the country, preemption would prevent attainment

of Federal air quality standards mandated by the Act. The

commenter asserted that if the EPA intends that the rule be

preemptive, it must state this clearly and the EPA must then

reopen the comment period.

Response: The architectural coating rule sets minimum

national requirements. In areas where State or local regulations

are in place or are subsequently developed that are more

stringent than the national rule, manufacturers and importers

must meet these more stringent levels. The final rule has been

amended to include provisions in § 59.410, State authority, to

clarify that States are not restricted in establishing and

enforcing their own standards. Whether or not there are

applicable State rules, the Federal rule applies. The EPA notes

that section 183(e) does not provide for preemption of State

rules.
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2.2.1.2 Low-Volume Exemption

Comment: Twenty-one commenters (IV-D-08, IV-D-26, IV-D-28,

IV-D-32, IV-D-74, IV-D-93, IV-D-120, IV-D-147, IV-D-151,

IV-D-161/IV-F-1j, IV-D-162, IV-D-176, IV-D-189/IV-F-1o, IV-D-209,

IV-F-1b, IV-Ff, IV-F-1i, IV-F-1k, IV-F-1m, IV-F-2q, IV-G-2)

provided comments on an exemption for coatings produced in low

volumes. The EPA described this potential provision and

solicited comment on it in the proposal preamble (61 FR 32741). 

The EPA described this exemption as a compliance option under

which "any manufacturer or importer may request an exemption from

the VOC levels in table 1 for specialized coating products that

are manufactured or imported in quantities less than a specified

number of gallons per year." The EPA specifically requested

comment on exemptions ranging from 1,000 to 5,000 gallons. The

exemption, as described in the proposal, could be used by a

manufacturer for multiple products, provided that each product

was manufactured in quantities less than the cutoff level. As

described in the proposal preamble, the manufacturer would have

been required to submit a request for the exemption and document

that the product(s) for which the exemption was requested "served

a specialized use which cannot be cost-effectively replaced with

another, lower VOC product."

Seventeen commenters (IV-D-08, IV-D-26, IV-D-74, IV-D-93,

IV-D-120, IV-D-147, IV-D-151, IV-D-162, IV-D-176,

IV-D-189/IV-F-1o, IV-D-209, IV-F-1b, IV-F-1f, IV-F-1i, IV-F-1k,

IV-F-2q, IV-G-2) supported some form of a low-volume exemption

and four commenters (IV-D-28, IV-D-32, IV-D-161/IV-F-1j, IV-F-1m)

opposed a low-volume exemption.

Support low-volume exemption. Suggested levels for the

low-volume exemption ranged from 100,000 gallons per product to

less than 1,000 gallons per product. Specifically, suggestions

were distributed as follows:

Suggested Level Commenters

100,000 gallons per product IV-D-176
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5,000 gallons per product IV-D-26, IV-D-93, IV-D-120,

IV-D-151, IV-D-162, IV-D-209

<2,000 gallons per product IV-F-1i

1,000 gallons per product IV-D-74, IV-D-189/IV-F-1o,

IV-F-1k, IV-F-1b

Level not specified IV-F-1f, IV-F-2q

In addition to per-product exemption requests, two commenters

(IV-D-08, IV-G-02) requested an exemption level of 5,000 to

10,000 gallons per category (i.e., the exemption would be based

on the total gallons of all of the manufacturer's products in a

particular category). One commenter (IV-D-147) requested an

exemption level of 7,000 gallons per category stating that to

reformulate his company’s architectural coating products would be

a cost burden because they would need to hire new personnel and

little if any growth would be expected in the market. Because

large manufacturers can better accommodate this burden due to

their laboratory staffs and assets devoted to developing new

products, the commenter argued that it is imperative that small

businesses be offered some exemption from this rule that is

commensurate with their production volumes or units sold in

various categories. As an alternative to the low-volume

exemption per product approach, the commenter suggested that a

low-volume exemption for all categories combined should be

considered since it would lessen the amount of recordkeeping and

streamline reporting.

 One commenter (IV-D-08) stated that the low-volume exemption

would benefit both large and small businesses producing specialty

coatings. The commenter asserted that this exemption would help

prevent the elimination of certain specialty products and enable

the introduction and development of new solventborne specialty

products. One commenter (IV-D-120) supported the incorporation

of an exemption that could be used for those products for which

reformulation is not economically or technologically feasible. 

The commenter argued that this exemption would help to level the
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playing field between small niche market producers and large

companies, and would likely increase compliance with the rule. 

The commenter stressed that the exemption should apply to all

businesses regardless of size.

One commenter (IV-D-151) requested that if the EPA does not

create the categories it requested, that either exceedance fees

or a 5,000 gallon per product low-volume exemption be provided as

an alternative.

Another commenter (IV-D-93) supported a low-volume

exemption, of 5,000 gallons or less (per product implied), but

also suggested the exemption could be determined as a percentage

of the company's total production. The commenter stated that

this type of exemption would allow it to focus on reducing the

VOC content of larger volume products while continuing to produce

the lower volume products for which reformulation would be more

costly. The commenter expected that the EPA would phase out the

exemption or reduce it over time.

One small company (IV-F-2q) stated that it manufactures

coatings in 10 categories for a total volume of approximately

30 to 40 thousand gallons. The commenter’s company picks up the

low volume (1 to 200 gallon) orders that larger companies are not

willing to fill. The commenter stated that a low-volume

exemption would help it maintain its position as a marketer of

niche products. 

One commenter (IV-F-1i) supported the low-volume exemption

as the only practical means for keeping particular small volume

products available to customers. The commenter stated that it

will not be economical to reformulate these products because the

cost is spread over so few gallons. At an exemption level of

1,000 gallons per product, the commenter believed that abuse of

this category will be self-limiting because the costs of labels,

special manufacturing, inventory, and marketing would prevent

cheating. The commenter recommended a level no higher than

2,000 gallons per product with severe sanctions for anyone caught

cheating.
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Another commenter (IV-D-189/IV-F-1o) supported the

low-volume exemption because it would allow certain niche needs

to be met without having to resort to a variance or amendment to

the rule. The commenter stated that a limit of 1,000 gallons per

year would be adequate to meet the requirements of industry while

at the same time ensuring that the exemption does not become a

large source of additional VOC emissions. Three commenters

(IV-F-1f, IV-F-1k, IV-G-2) supported the low-volume exemption as

an opportunity to make specialized coatings available. Three

commenters (IV-D-189, IV-F-1b, IV-F-1k) emphasized that the

exemption should be available to all manufacturers irrespective

of their size. One commenter (IV-F-1k) cautioned that there may

be additional reporting and enforcement problems inherent in this

approach.

One commenter (IV-D-176) believed the suggested level of

1,000 to 5,000 gallons was too low because it would include only

those one-person or part-time manufacturers who operate out of

their homes and by word of mouth. The commenter believed that it

fits the EPA’s concept of a small, low volume company operating

in a niche market because it is considered by industry analysts

and competitors to be a small firm in the hardwood floor finish

industry, it employs only 10 employees, and over 90 percent of

its sales come from four products. The commenter argued that the

EPA should increase the low volume level to cover small, niche

market firms that will endure great economic hardship because of

the architectural coating rule. It suggested that the EPA

consider a low-volume exemption level of 100,000 gallons, which

would exclude medium and large sized manufacturers but would

include small companies that focus on niche markets. 

One commenter (IV-F-2gen) asked whether the proposed

low-volume exemption would be based on all of a manufacturer's

sales or on the sales of only one of a manufacturer's products. 

If the exemption is on a per product basis, several manufacturers

(IV-F-2gen) indicated that there would be some difficulty in

defining a "product." One manufacturer (IV-F-2gen) suggested
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that a registered formula could be submitted to the EPA as a

means of clarifying what constitutes a product.

One commenter (IV-D-209) requested consideration of a cutoff

of 5,000 gallons per product per year. The commenter stated that

this is an appropriate cutoff to provide some relief for all

manufacturers who sell low-volume niche products for which

reformulation is not economically or technologically feasible. 

Without this provision, the commenter stated that some small

niche businesses could go out of business. 

One commenter (IV-D-74) who sells more than 500,000 gallons

of coatings and mastics per year requested a low-volume exemption

for two products: a waterproof masonry product with sales of

796 gallons in 1995, and a coating used to paint exterior metal

surfaces for roofing applications with sales of less than

400 gallons per year. The commenter implied that products with

this sales volume are the ones for which an exemption is

appropriate.

Oppose low-volume exemption.

Four commenters (IV-D-28, IV-D-32, IV-D-161/IV-F-1j,

IV-F-1m) opposed the low-volume exemption for specialty niche

products because they believe it would provide an incentive for

companies to develop purportedly "new" specialty products in

order to keep selling non-compliant coatings. One commenter

(IV-D-161/IV-F-1j) stated that such an exemption would be subject

to abuse if each color of a specific product line could be

considered a separate low-volume item and separate names could be

created for identical coatings. Another commenter (IV-D-32)

stated that since many manufacturers produce individual batches

of paint for specific users, this provision could encourage the

creation of a specialty coating for each end user resulting in

categories such as "horizontal lathe paint," "gantry crane

coating," or "paper plant paint." In addition, another commenter

(IV-D-161/IV-F-1j) stated that the proposed requirement for the

manufacturer to verify that "the product serves a specialized

need for which a lower VOC product does not exist" is impractical

given that each manufacturer considers its products to be special
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and few manufacturers are familiar with all of the products

offered by all of the other manufacturers. The commenter stated

that if the EPA decides to adopt such a low-volume exemption, the

cutoff should be set at a level no higher than 500 gallons to

minimize the incentive to use the exemption to circumvent the

rule. This commenter stated that a 500-gallon cutoff is still

high enough to be of practical use to true specialty niche

products. The commenter pointed out that volumes of 1,000 to

5,000 gallons are high enough to include many of the lower volume

line items sold by large regional and national manufacturers for

which the exemption is not appropriate. According to another

commenter (IV-D-28), if there is a bonafide need for such

specialty coatings, a variance provision or a rule modification

would accommodate these products.

 Another commenter (IV-F-1m) stated that the low-volume

exemption would not provide any significant relief because so few

products are manufactured in the range of one to 5,000 gallons

annually.

One commenter (IV-D-32) stated the exemption for low-volume

coating categories is not needed and would further weaken the

effectiveness of the regulation, which the commenter suggested

already contains moderate VOC levels. 

Response: Based on the arguments presented by commenters

about the need for some type of exemption for very low-volume

specialty products for which it is not cost-effective for either

the manufacturer or the resin supplier to devote time and

resources to reformulation, the EPA believes that some form of

exemption should be included in the final rule to accommodate

these types of products. Although in the proposal preamble, the

exemption was described in terms of a per-product exemption at a

level between 1,000 and 5,000 gallons, the EPA considered the

potential problems highlighted by commenters with this type of

provision and developed a variation on the low-volume exemption

approach to include in the final rule. Specifically, the EPA has

added a VOC tonnage exemption to the final rule. This approach

continues to accommodate the needs of small businesses, niche
5 lbs/gallon  10,000 gallons 
 50,000 lbs or 25 tons

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markets, and specialty products, as did the proposed low-volume

exemption; but it more effectively limits the VOC emissions

resulting from the exemption.

Under the VOC tonnage exemption, each manufacturer can

exempt a total of 23 megagrams (25 tons) of VOC in the period of

time from the compliance date through December 31, 2000;

18 megagrams (20 tons) in the year 2001, and 9 megagrams

(10 tons) for the year 2002 and for each year thereafter. Since

some corporations have multiple companies and/or divisions, an

architectural coatings manufacturer or importer is defined in the

rule to mean the parent company and not each individual company,

subsidiary, or division. Thus, if a corporation (parent company)

has several subsidiaries or divisions that manufacture coatings,

only one exemption per parent company will be allowed annually. 

The EPA believes that this is an equitable way of implementing

this provision without sacrificing VOC emission reductions or

providing any advantage of large manufacturers over small

businesses. For the purposes of the tonnage exemption, the

manufacturer or importer calculates VOC tonnage by multiplying

the total sales volume in liters by the "in the can" VOC content

of the coating in grams per liter of coating including any water

or exempt compounds. The "in the can" VOC content must include

consideration of the maximum thinning recommended by the

manufacturer. In the following examples, g/l (or lb/gal) is an

abbreviation for grams (or pounds) of VOC per liter (or gallon)

of coating including water and exempt compounds at the

manufacturer’s maximum recommendation for thinning. For example,

under this exemption in the first year a manufacturer could

exempt 38,300 liters (10,000 gallons) of a 600 g/l (5 lb/gal)

coating.

Alternatively, a manufacturer could exempt 18,939 liters

(5,000 gallons) of an 800 g/l (6.67 lb/gal) coating plus
[(6.67 lbs/gal  5,000)(4.58 lbs/gal  3,625)] 
 50,000 lbs or 25 tons

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13,731 liters (3,625 gallons) of a 550 g/l (4.58 lb/gal) coating. 

Basically, any combination of coatings and volumes can be

exempted as long as the total emissions from these products do

not exceed 23 megagrams (25 tons) in the time period from the

compliance date through December 31, 2000; 18 megagrams (20 tons)

in the year 2001; and 9 megagrams (10 tons) in the year 2002 and

each year thereafter.

The EPA has established the tonnage limits to exempt no more

than 1.5 to 2 percent of the total expected emission reductions

from architectural coatings in the first year the standard is in

effect. The EPA intends the diminishing size of the tonnage

exemption to serve a dual purpose of providing an exemption for

niche products yet also provide incentive for manufacturers and

importers to achieve VOC emission reductions from their products. 

The EPA expects that the 9 megagrams (10 tons) per year exemption

that goes into effect in the year 2002 will provide continued

protection for niche products and adequate flexibility for

unforeseen future needs, while effectively limiting emissions due

to the exemption of limited amounts. The EPA expects the initial

tonnage exemption will allow manufacturers and importers to

exempt one to three coatings in quantities up to 27,000 liters

(7,100 gallons), thereby accomplishing the intended function of

the originally proposed low-volume exemption.

This exemption differs from the low-volume exemption in the

proposal preamble in the following ways:

(1) The EPA changed the exemption from a per product basis

to a per manufacturer basis. This was done to avoid

the difficulty of defining a "product" and to avoid the

related potential for abuse by manufacturers in

designating products for exemption. 

(2) The EPA changed the exemption level from gallons of

coating to tons of VOC. This change was made for two

primary reasons. First, it provides an incentive for
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manufacturers to reduce the VOC content of the coatings

for which they claim this exemption. For example, with

a 5,000 gallon exemption, the manufacturer could exempt

5,000 gallons whether the product was 850 g/l or

200 g/l. With a tonnage exemption, however, the VOC

content in each can of coating counts toward the

allotted exemption. Therefore, if the manufacturer

reduces the VOC content of the coating it wishes to

exempt, more gallons of that coating could be sold

under the exemption. Second, the choice of VOC tonnage

instead of gallons of coating for the exemption alters

the exemption from an unknown loss of emission

reductions to a cap on tons exempted per manufacturer. 

Therefore, this change serves to place an upper bound

on the emission reductions that are lost through this

exemption, which allows the EPA to better estimate its

anticipated impact.

(3) The exemption is reduced over time. The ratcheting

down of the tonnage exemption from 23 megagrams

(25 tons), to 18 megagrams (20 tons), and then to

9 megagrams (10 tons), provides a strong incentive to

manufacturers using the exemption to continue to seek

ways to reduce the VOC content of their coatings.

In addition to the tonnage exemption, the EPA has also added

several new coating categories to the final rule that address

specific groups of specialty coatings that were identified

through public comment. The EPA notes that section 183(e)

expressly authorized the EPA to use any system or systems of

regulation that the EPA deems appropriate to achieve the

necessary emissions reductions and to do so with consideration of

what constitutes best available controls (BAC). The EPA has

concluded that a tonnage exemption is appropriate to meet the

objectives of section 183(e), while taking into account factors

such as economic and technological feasibility. 

2.2.1.3. Small Container Exemption

The proposed rule specifically exempted coatings sold in

containers with capacities of 1 liter or less from the

requirements of the rule. Ten commenters (IV-D-21, IV-D-28,

IV-D-32, IV-D-96, IV-D-185/IV-F-1n, IV-D-189, IV-D-206, IV-F-1b,

IV-F-1i, IV-F-1j) provided comments on the small container

exemption. Seven commenters (IV-D-21, IV-D-28, IV-D-185/IV-F-1n,

IV-D-189, IV-D-206, IV-F-1b, IV-F-1j) supported the exemption,
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two commenters (IV-D-96, IV-F-1i) opposed the exemption, and one

commenter (IV-D-32) supported the exemption but favored a

phaseout of the exemption over time.

Support. According to one commenter (IV-D-206), the

exemption will allow small quantities of proven products to

remain on the market. Two commenters (IV-D-189, IV-D-206) stated

that this exemption is not likely to be abused due to the higher

prices and inconvenience of using small quantities.

Two commenters (IV-D-185/IV-F-1n, IV-F-1b) strongly

supported the small container exemption because it permits

certain useful, low-volume specialty products to continue to

exist for which it is not cost-effective or technologically

feasible to reformulate. One commenter (IV-D-185/IV-F-1n)

asserted that products sold in small containers have a minimal

impact on air quality. In addition, the commenter stated that

all States that have passed their own architectural coating rules

offer a small container exemption and have found it to be a

workable and enforceable mechanism.

One commenter (IV-D-21) urged that the small container

exemption remain in the rule to allow for unrestricted sale of

products by the quart. Another commenter (IV-D-28) supported the

exemption of small containers but asked the EPA whether the small

containers are subject to the labeling requirements.

Opposition. One commenter (IV-D-96) characterized the small

container exemption as a loophole that the EPA should remove. 

The commenter stated that this provision is currently being taken

advantage of in many State architectural coating rules to bypass

VOC content limits.

Another commenter (IV-F-1i) stated that the small container

exemption will not primarily benefit small businesses since small

containers are sold by large retail coating manufacturers. 

Moreover, this commenter asserted that efficient filling and

labeling of small containers tends to be a capital intensive

operation that is not really suitable for small businesses and

that it is primarily used by large manufacturers.
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Sunset provision. One commenter (IV-D-32), in a State

(Oregon) with an architectural coating rule, encouraged the EPA

to include a future date (e.g., 2002) after which the small

container exemption would no longer apply. The suggestion for a

“sunset” provision is based on the commenter's observation that

small containers of non-compliant coatings are purchased to

recover and repair surfaces coated with non-compliant coatings

and that in time surfaces will be replaced with compliant

coatings so that the need for the non-compliant coating will

decrease to zero.

Response: The EPA has retained the small container

exemption in the final rule to provide compliance flexibility to

manufacturers. The EPA anticipates that the exemption will allow

some coatings to be offered for sale that do not meet the VOC

content limits in table 1. Coatings that fall under the small

container exemption are not subject to labeling or any other

requirement in the architectural coating rule. By not including

a “sunset” provision in the rule for the small container

exemption, the national rule is more compatible with State rules,

which should help coating manufacturers with regulatory planning

and compliance. The EPA believes that abuse of the exemption is

unlikely due to the higher cost and inconvenience to consumers of

using smaller containers. If the EPA determines that the

exemption is being abused, the EPA may revisit the issue and

modify or remove the exemption from the national rule. Likewise,

an individual State may choose to be more stringent and modify

its rule to not allow this exemption in areas where there is a

need for additional VOC emission reductions.

2.2.2 Processors as Regulated Entities

Comment: In the proposal preamble (61 FR 32737), the EPA

requested comment on the possible inclusion of “processors” as a

regulated entity. The EPA suggested that “processor” could be

defined as “an individual who adds organic thinner to the coating

in a commercial/industrial setting at the point of application.” 

This would allow the regulation to prohibit an applicator from

using organic solvents to thin a coating beyond the
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manufacturer’s recommendation, thereby negating some of the

emission reductions expected to be achieved by the rule. Eight

commenters (IV-D-28, IV-D-32, IV-D-120, IV-D-161, IV-D-162,

IV-D-189, IV-D-206, IV-D-213/IV-F-1f) stated that the rule should

not regulate processors. One commenter (IV-D-33) supported the

inclusion of processors as a regulated entity.

Oppose. Four commenters (IV-D-28, IV-D-162, IV-D-206,

IV-D-213/IV-F-1f) stated that it would be difficult to verify or

enforce this provision. One commenter (IV-D-206) believed

regulation of applicators is unnecessary because thinning is not

as widespread as believed. Based on the commenter’s experience,

most coatings are used directly from the can because most

painters are uncertain how products will perform after thinning

and do not know how thinning will affect the uniformity of color

over large areas. One commenter (IV-D-161) believed that at the

proposed VOC content limits, excessive thinning in the field will

not occur.

One commenter (IV-D-213/IV-F-1f) stated that the only way a

contractor can continue to meet the demands of customers is to

have the flexibility of thinning a coating on-site when

necessary. The commenter stated that a painting contractor’s job

is to apply a coating at the optimum consistency. By restricting

thinning practices, the commenter asserted that contractors would

potentially be exposed to legal liability for non-performance

under a contract. In addition, the commenter stated that a

decision about which application method to use is oftentimes made

at the site considering variables such as temperatures and

humidity. It may be necessary to thin the product on—site in

order to create an optimum application. 

Two commenters (IV-F-1f, IV-F-1m) supported California's

position that permits the thinning of coatings in the field under

abnormal environmental and application conditions. One commenter

(IV-F-1m) stated that the provision was specifically introduced

to provide applicators with the ability to apply these coatings

under a range of environmental conditions that are not

necessarily optimal at all times. One commenter (IV-D-32) noted
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that a national rule aimed at controlling VOC at the

manufacturing level would minimize the need to regulate

downstream parties such as retailers and commercial painters. 

One commenter (IV-D-189) recommended that the regulation of

end users be handled through State regulations and that the EPA

could encourage regulation through its State Implementation Plan

approval process. According to another commenter (IV-D-120),

large processors, for example, are often regulated by air permits

that evaluate the processor’s VOC emitting operation and consider

whether the surrounding area is nonattainment or attainment. The

commenter asserted that small processors are often regulated in

nonattainment areas under State or local regulations. For

example, independent air quality management districts of

California require processors to record VOC emitted during

application. 

Five commenters (IV-D-28, IV-D-121, IV-D-189, IV-D-206,

IV-D-213/IV-F-1f) questioned the legal basis for regulation of

end users or applicators (“processors”), stating that

section 183(e) of the Act does not apply to end users or

applicators as regulated entities. Two commenters (IV-D-189,

IV-D-213/IV-F-1f) stated that Congress intended the term

"processors" to mean entities that repackage coating materials or

further enhance finished products before they are offered for

sale to end users. In support of a similar argument, another

commenter (IV-D-213/IV-F-1f) presented the following quote from

the House Energy and Commerce Committee report: “The

administrator may apply the regulations under this subsection

only at the level of the manufacturer, processor, wholesale

distributor or importer.” The commenter stated that the term

"processor" is used in a context that relates to those who are

manufacturing or distributing the product but not to those who

are using it in the field.

Support. One commenter (IV-D-33) supported expanding the

rule's applicability to include large commercial or industrial

applicators of architectural coatings ("processors") to guard
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against over-thinning with organic solvents and thus exceeding

the applicable regulatory limit.

Response: The EPA considered regulating individuals who add

organic thinner to the coating in a commercial or industrial

setting at the point of application as processors as a means to

guard against thinning beyond manufacturers’ recommendations. 

However, the EPA agrees that enforcement of such a provision

would be difficult because these coatings are applied at such a

wide variety of locations (i.e., not at any set emission points

where the EPA can routinely send enforcement personnel). 

Consequently, the EPA believes that regulation of “processors”

will not add significantly to the effectiveness of the rule and,

thus, did not include them as regulated entities for the final

rule. The EPA notes that in choosing the best system or systems

of regulation that is appropriate to achieve reductions, the EPA

has examined the capability of enforcement as one factor. The

EPA believes that setting appropriate VOC content limits for

products is the most feasible means to achieve the objectives of

the statute.

In response to commenters’ concerns about the need for

applicators to be able to add solvent to the coating at the

application site, it should be noted that the EPA’s rule

regulates the VOC content of a coating including any VOC from

thinning instructions recommended by the manufacturer. In other

words, the rule already allows and accounts for VOC added by

applicators in accordance with the coating manufacturer’s

thinning instructions. It is thinning beyond any manufacturer’s

recommendation that the EPA was considering devising a mechanism

to address. Given the inherent difficulties of policing coating

thinning, the EPA concluded that it is better to anticipate

thinning and set limits that take into account foreseeable added

emissions. However, as noted by commenters, the EPA believes

that most users will not over-thin products because it may have

adverse product performance effects. In the event that some

areas like California need additional controls and assurances,
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they may choose to continue to impose their own additional

regulations on users.

2.2.3 Definitions

2.2.3.1 General

Comment: One commenter (IV-D-101) asked if coatings used on

billboard structures fall in the category of industrial

maintenance, graphic arts, flat or nonflat coatings, or some

other category.

Response: As stated in the definition of architectural

coatings, the rule only applies to coatings “recommended for

field application to stationary structures and their

appurtenances, to portable buildings, to pavements, or to curbs.”

This definition excludes adhesives and coatings recommended by

the manufacturer or importer solely for shop applications or

solely for application to non-stationary structures, such as

airplanes, ships, boats, and railcars." Consequently, steel

beams or other structural components coated in a shop or

manufacturing setting are not subject to this regulation. 

However, if the coating is applied outside of a shop setting

(e.g., to an erected billboard), the paint used to create the

billboard or sign itself would be classified as a graphic arts

coating. Because the graphic arts coating category specifically

excludes coatings used on structural components, the paint used

to coat the structural components of the billboard (e.g., the

steel beams that support the billboard or sign) would be

classified as an industrial maintenance coating. These coatings

are high performance coatings used on exterior metal structures

and structural components and, therefore, meet the rule’s

definition of an industrial maintenance coating.

Comment: One commenter (IV-D-101) requested that the EPA

identify the category that the following products would fall

into: paints for yard furniture, paints for children's metal or

wooden wagons, craft paints, and correction fluid (white-out). 

Response: Because the rule applies to coatings used on

“stationary structures and their appurtenances,” coatings applied

to yard furniture and wagons would not be covered under the rule
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because furniture and wagons are not stationary structures. 

However, because these types of coatings are rarely marketed for

such a limited application and instead may be intended for more

general uses (i.e., coating exterior metal surfaces), it is

likely that consumers purchasing coatings for these applications

would choose a coating for general use on steel or wood. The

more general usage coating purchased by the consumer for these

applications would likely fall into categories such as

rust-preventative, flat, or nonflat coating. 

Craft paints and correction fluid are not included in the

definition of architectural coatings because these are applied to

paper products rather than to stationary structures and,

therefore, are not subject to the rule. In addition, containers

of coatings that are 1 liter or less and aerosol spray paints are

not subject to this rule. 

2.2.3.2 Pigmented

Comment: One commenter (IV-D-162) stated that in addition

to imparting color, pigments are used to provide corrosion

inhibition, conductivity, fouling resistance, opacity, and to

improve mechanical properties.

Response: The EPA has expanded the definition of pigmented

to include the additional properties of pigments identified by

the commenter. Therefore, the definition in §59.401 of the final

rule now reads as follows: "Pigmented means containing finely

ground insoluble powder used to provide one or more of the

following properties: color; corrosion inhibition; conductivity;

fouling resistance; opacity; or improved mechanical properties."

2.2.3.3 Lacquers

Comment: One commenter (IV-D-189) suggested eliminating the

word "wood" from the definition of lacquer. The commenter

explained that limiting this category to only lacquers formulated

for use on wood substrates is unnecessary. In fact, the

commenter noted that lacquers are used on a variety of substrates

where a fast drying, clear, high gloss protective finish is

desired. Another commenter (IV-F-1) also asked why the

definition of lacquer is specifically limited to wood finishes.
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Response: Although the EPA recognizes that lacquers are

used on a variety of substrates, the EPA purposefully limited the

definition of lacquers to wood coatings because applications on

other substrates are covered by other categories. The VOC

content limits for the other categories reflect consideration of

the need for lacquer application to the non-wood substrates. For

example, a lacquer coating used on concrete would need to comply

with the VOC content limit for the category that relates to that

application (e.g., the concrete curing and sealing category)

rather than its resin type (e.g., a lacquer). Consequently, the

EPA did not alter the definition of lacquer in the final rule as

suggested by these commenters. 

Comment: One commenter (IV-D-161) asserted that nonferrous

ornamental metal lacquers are a subcategory of lacquers. The

commenter proposed reformatting table 1 and showing nonferrous

ornamental metal lacquers as a subcategory of the lacquer

category.

Response: The EPA does not agree that table 1 should be

reformatted to show nonferrous ornamental metal lacquers as a

subcategory of lacquers because the category of lacquers is

limited to applications to wood. However, to address potential

overlap for coatings that meet the definitions of both the

nonferrous ornamental lacquers category and another category

(e.g., the industrial maintenance category), § 59.402(c) of the

final rule has been amended to clarify that the limit for

nonferrous ornamental lacquers is meant to apply.

Comment: One commenter (IV-D-161) advocated that the EPA

clarify the definitions of lacquers and lacquer stains. The

commenter pointed out that although the preamble (61 FR 32739)

states that lacquer stains would meet the stain VOC content limit

(550 g/l) rather than the lacquer limit (680 g/l), current State

regulations require lacquer stains and lacquer sealers to meet

the VOC content limit for the lacquers category rather than the

VOC content limit for the stain or sealer category. 

Response: The EPA included lacquer sanding sealers in the

lacquers category because these coatings perform more like
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lacquers, whereas lacquer stains function more like semitransparent stains and, thus, they are regulated under the clear

and semitransparent stains category. This is consistent with at

least one State’s regulation of lacquer stains (A-92-18,

II-D-185, IV-E-36). In addition, only one State (Kentucky)

architectural coatings rule has a lacquer stain category with a

VOC content limit of 550 g/l, which is the same limit as the

clear and semi-transparent stain category in the final rule. 

Therefore, the EPA has added a sentence to the definition of

lacquer to clarify that lacquer stains must meet the VOC

requirements for stains rather than lacquers. 

2.2.3.4 Quick-dry Enamel

Comment: Two commenters (IV-D-189, IV-F-2) recommended that

the EPA modify the definition for “quick-dry enamel” by removing

the requirement that the dry film must have a gloss of 70 or

above on a 60 degree meter (measures the specular reflectance of

the paint at a 60-degree angle). One commenter (IV-D-189) argued

that the primary criterion for a coating to be considered a

quick-dry enamel is that it is a nonflat coating which meets a

specific dry time and, therefore, the gloss requirement is

unnecessary. 

One manufacturer (IV-F-2) was concerned because it has a

low-VOC quick-dry enamel that does not have a gloss of 70 or

higher as required in the quick-dry enamel definition. Another

commenter (IV-F-2) stated that the gloss restriction had been

removed from State regulations. The commenter asked the EPA to

explain why it included this restriction in the proposed rule. 

Response: The EPA has not removed the 70 or above gloss

restriction in the definition of “quick-dry enamel” as requested

by the commenters. Because this category is expected to be used

by manufacturers to sell nonflat enamels that do not meet the

380 g/l VOC content limit for general nonflat coatings, the EPA

asserts that it is important to limit the quick-dry category to

coatings meeting both high-gloss and quick-dry criteria to

restrict the use of the category to situations where the consumer

desires both of these properties. The proposed definition is
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consistent with all but one of the existing State architectural

coating regulations that the EPA reviewed that recognize this

category. During a recent analysis of a 1995 paint

characterization study conducted by Harlan and Associates

(IV-J-16), the nonflat coatings portion of the study showed that

most coatings labeled as quick-dry enamels really did not meet

the dry times according to ASTM D1640 and other performance

tests. However, recent resin development work has resulted in

high quality, acrylic, high-gloss coatings with quick dry times

(IV-J-16). Coatings that do not meet the film gloss of 70 or

more would be subject to the nonflat coating VOC content limit of

380 g/l.

2.2.3.5 Traffic Marking Coating

Comment: One commenter (IV-D-189) pointed out that the

addition of a zone marking category would necessitate removing

references to driveways and parking lots from the definition of

traffic marking coating.

Response: The references to driveways and parking lots have

not been deleted from the definition of traffic marking coatings

because traffic marking coatings sold in containers of more than

5 gallons would be subject to the traffic marking VOC content

limit of 150 g/l. The EPA has established a separate category

for zone markings and the following definition has been added to

the definitions section of the final rule: "Zone marking coating

means a coating formulated and recommended for marking and

striping driveways, parking lots, sidewalks, curbs, or airport

runways, and sold or distributed in a container with a volume of

19 liters (5 gallons) or less." Zone marking coatings are

restricted to a VOC content of 450 g/l. Coatings for airport

runways, driveways, parking lots, sidewalks, and curbs can be

either zone marking coatings (if they are sold in containers with

a volume of 19 liters (5 gallons) or less) or traffic marking

coatings (if the container is larger than 19 liters); so the

reference to these areas still appears in the traffic marking

coating definition.
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2.2.3.6 Sealer

Comment: One commenter (IV-D-161) stated that the proposed

definition of "sealer" precludes the use of a sealer as the final

coating in a coating system. The commenter supplied two

instances where a sealer would be applied as a final coat over

other coatings: (1) waterproofing sealers can be the only

coating applied to the substrate, and yet by definition these are

sealers; and (2) horizontal surfaces like decks, patios, and

walkways can be stained and then have a sealer applied to protect

the stained substrate from wear. The commenter mentioned a line

of semi-transparent stains for concrete patios, sidewalks, and

similar surfaces where a sealer is recommended to protect the

concrete from damage, wear, and water penetration. The commenter

designated this final coat as a sealer. The commenter contended

that without a sealer, surfaces will wear unevenly and need

reapplication of other coatings. The commenter stated that these

coatings are not generally considered varnishes since performance

characteristics are a result of the penetration of the material

into the stained substrate. The commenter recommended that the

definition of sealer be amended to include such uses by adding

the phrase "to prevent harm or damage to porous substrates." 

Response: It was not the EPA's intent to preclude the use

of a sealer as the final or only coating of the system, and the

EPA does not believe that the proposed definition suggested this. 

Therefore, the EPA does not believe it is necessary to add the

suggested phrase to the definition of sealer in the final rule.

2.2.3.7 Industrial Maintenance Coatings

Comment: One commenter (IV-D-158) stated that the

industrial maintenance coatings category, as proposed, limits

industrial maintenance coatings to industrial, commercial, or

institutional applications. The commenter maintained that the

purpose of this category should be to allow a high performance

coating to prevent substrates from degradation when exposed to

extreme environmental conditions. Therefore, the commenter

suggested changing the industrial maintenance coatings definition

so that "acute or chronic exposure to corrosive, caustic, or
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acidic agents, or to chemicals, chemical fumes, or chemical

mixtures or solutions" and "in industrial, commercial, or

institutional situations" are not part of the definition. 

Another commenter (IV-D-189/IV-F-10) stated that the

reference to industrial, commercial, or institutional situations

in the industrial maintenance coatings definition implies that

use should be limited to these situations. Instead, the

commenter asserted that the use of industrial maintenance

coatings should be allowed whenever a substrate needs protection

from extreme conditions, regardless of setting. The commenter

argued that the preamble and §59.403(b) of the proposal

demonstrated that it is not the intent of the EPA to limit the

use of industrial maintenance coatings to industrial, commercial,

or institutional situations. In addition, the commenter noted

that some of the extreme environmental conditions the EPA listed

in the definition do not properly represent the conditions for

which these high performance coatings have been formulated. 

Specifically, the commenter recommended that the EPA modify the

definition of industrial maintenance coatings as follows to

eliminate references to setting and to properly represent

conditions for use:

"Industrial maintenance coatings" means high performance

coatings, including primers, sealers, undercoaters, and

intermediate and top coats, formulated and recommended to

protect substrates from degradation when exposed to one or

more of the following conditions:

(revised) 1. Frequent scrubbing or abrading including

mechanical wear and repeated cleaning with

industrial agents and/or disinfectants;

(new) 2. Steam;

(revised) 3. Continuous or repeated exposure to temperature

above 200 F; o

(revised) 4. Immersion in water or wastewater or chronic

exposure of surfaces to moisture condensation;

(revised) 5. Exposure to chemicals such as acids, alkalies,

organic solvents, oxidizing or reducing agents,

salt spray, or other corrosive materials or
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mixtures, including exposure by immersions,

splash, spill, or fumes; or

(no change) 6. Exterior exposure of metal structures and

structural components.

One commenter (IV-D-183) expressed concern that the

industrial maintenance coating category definition is too easy to

misinterpret. The commenter added that it is too easy to change

one word in the category definition and ban these products from

places where they might be needed. However, the commenter was

not specific and did not recommend any changes.

Another commenter (IV-D-85) requested that the EPA better

define the coating categories and minimize overlap. In

particular, the commenter recommended adding: “not to include

schools and public buildings" to the definition of industrial

maintenance coatings to eliminate any loopholes. 

Response: The EPA’s intent is to limit the use of these

higher VOC coatings to extreme environmental conditions as

provided in the definition of industrial maintenance coatings

(§59.401) and in §59.405(b). The EPA has therefore maintained

the reference to “industrial, commercial, or institutional

situations” because these are the settings under which these

types of extreme conditions listed in the definition of

industrial maintenance coatings are typically found and the

commenters did not provide information to the contrary. The EPA

intentionally set the proposed VOC content limit for industrial

maintenance coatings based on more rigorous performance

specifications than those typically needed for residential

applications. However, the use of industrial maintenance

coatings is not prohibited in residential areas. At proposal,

the EPA noted (61 FR 32742) in the discussion of the labeling

requirements for containers of industrial maintenance coatings

that the use of industrial maintenance coatings was not

prohibited in residential settings where extreme environmental

conditions are present and for which an industrial maintenance

coating would provide the most viable protection. The EPA has

amended the industrial maintenance coating labeling requirement
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in the final rule to allow greater flexibility. The manufacturer

or importer can select from the following statements to comply

with the industrial maintenance labeling requirements. 

1. “For industrial use only”;

2. “For professional use only”;

3. “Not for residential use” or “Not intended for

residential use”; and

4. “This product is intended for use under the following

conditions: (list of conditions from the industrial

maintenance coating definition that apply)”.

The EPA has reviewed the suggested revision of the

industrial maintenance coatings definition that one of the

commenters suggested more properly represents the conditions for

which these high performance coatings have been formulated. 

However, the suggested addition of steam as one of the extreme

conditions could be interpreted to include bathrooms in

residential settings, which the EPA does not intend to include. 

Also, the extreme environmental conditions listed in paragraph 5

of the suggested revision appear to expand greatly the conditions

listed in paragraph 2 of the proposed definition without any

technical basis. The suggested revision to the definition

includes a change in temperature conditions for application from

250 F to 200 F. However, since 200 F is a temperature oo o

condition that may be able to be met by a wide variety of coating

types including some interior flat latex paints (A-92-18,

Item II-D-165), the EPA believes that this change would not

reflect the extreme conditions for which this category was

intended. Moreover, the EPA has not added the suggested phrase

to exclude schools and public buildings from the definition of

industrial maintenance coatings because the EPA believes that

schools and public buildings may require the use of higher

performance coatings than those typically needed for residential

applications. For these reasons, the EPA has determined that no

further changes to the industrial maintenance coatings definition

are necessary. 
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2.2.3.8 High Temperature Coating

Comment: One commenter (IV-D-189) suggested that the EPA

lower the minimum temperature requirement for the high

temperature coating category from 500 F to 400 F. The o o

commenter reported that this is the minimum temperature

requirement specified in all current State architectural coating

rules. The commenter also stated that the current requirement of

500 F does not reflect current industry consensus on what o

constitutes a high temperature coating.

Response: The EPA agrees that the minimum temperature

requirement for the high temperature coating category should be

400 F to reflect industry usage and to be consistent with o

existing State rules and, therefore, has modified the definition

of high temperature coating accordingly in the final rule. This

change will enhance the compatibility between the national rule

and State regulations that should help coating manufacturers with

regulatory planning and compliance.

2.2.3.9 Extreme High Durability Coating

Comment: One commenter (IV-D-101) pointed out that the

definition of extreme high durability coating at 800 g/l includes

only fluoropolymer-based coatings meeting AAMA

specification 605.2. The commenter also stated that this

excludes other coatings that meet AAMA 605.2, which requires

5 years of south Florida exposure, and have VOC contents in the

range of 500 g/l. The commenter also noted that the resin for

manufacturing the flouropolymer-based coating is exclusively

licensed to three large multi-national paint manufacturers and is

unavailable to small companies. 

Response: The EPA agrees that other coatings, in addition

to fluoropolymer-based coatings, that also meet the weathering

requirements of AAMA 605.2, should be classified as extreme high

durability coatings. According to follow-up information

(IV-E-44), these coatings are used only for touch-up of metal

panels that are precoated in a factory setting. During

transition from the factory to the field for assembly, the panels

are sometimes scratched or chipped and, thus, on-site touch-up is
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needed. Therefore, the EPA has expanded the definition of

extreme high durability coating in the final rule to include

these coatings, as follows: "Extreme high durability coating

means an air dry coating, including a fluoropolymer-based

coating, that is formulated and recommended for touch-up of

precoated architectural aluminum extrusions and panels to ensure

the protection of architectural subsections and that meets the

weathering requirements of American Architectural Manufacturer's

Association specification 605.2, section 7.9." 

2.2.3.10 Swimming Pool Coatings

Comment: One commenter (IV-D-101) asked the EPA whether

swimming pool coatings could be used on other surfaces. The

commenter informed the EPA that the monkey cages at University of

California, Davis have been painted with swimming pool paint

because they are washed down regularly and are subject to harsh

chemicals.

Response: The architectural coatings rule applies to

manufacturers and importers of coatings. The manufacturer or

importer would determine the applicable VOC content limit for a

coating by comparing the recommended uses of the coating to the

definitions of the various coating categories in the rule. If

the coating is recommended for use on swimming pools and is not

recommended for use in other categories, the VOC content limit

would be the limit specified for the swimming pool category

(i.e., 600 g/l). There is nothing in the rule that would

preclude someone from using this coating on other surfaces with

similar performance requirements. 

2.2.3.11 Reformulation

Comment: One commenter (IV-D-101), who attended the public

meeting on August 13, 1996, requested that the EPA clarify the

term "reformulation" used during the meeting. To the commenter,

reformulation meant adjusting a formula by changing additives,

solvents, or pigmentation but using the same resin. In contrast,

the commenter believes that any definition of reformulation that

contemplates requirements that result in switching resins in the

formula constitutes a product ban.
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Response: The EPA does not specify a definition of

reformulation in the regulation since that term is not used in

the regulation. Reformulation can consist of minor adjustments

in coating VOC contents or larger adjustments involving a change

in resin technology. For purposes of the cost analysis,

“reformulation” also includes activities required to place the

compliant product on the market, such as: product testing,

modifying labels, or changing marketing materials. The

adjustments to formulas that are necessary to comply with the VOC

content limits for categories in the rule would still result in

products that would meet the end use requirements of the

categories; therefore, they would not constitute product bans.

2.2.3.12 Shellac

Comment: One commenter (IV-D-25/IV-F-1s) pointed out that

the proposed shellac category allows manufacturers to have

broader formulation latitude than the traditional definition of

shellac. The commenter argued that the broad definition of

shellac would enable manufacturers to create and extend the

volume of coatings containing alcohol to shellac markets and

other end uses. The commenter requested that the proposed

definition of shellac be changed to the traditional definition to

avoid any VOC emission loopholes. The traditional definition of

shellac defines the base resin used in both clear and pigmented

shellac formulas as "formulated solely with the resinous

secretion of the lac beetle (laccifer lacca), thinned with

alcohol, and forms a film by solvent evaporation without chemical

reaction." The commenter stated that several States use the

traditional shellac definition and several have allowed the use

of additional natural resins. The commenter stated that the

shellac category was created because its existence was

self-defining and self-limiting. The commenter explained that

use of the non-traditional definition would result in additional

VOC emissions and create market confusion because shellac has

been a definable product class for decades. The commenter

explained that VOC emissions from shellac remain at constant

levels because shellac is available only from a limited
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geographic area in Southeast Asia which makes the supply limited,

keeps the price high, and limits the uses to odor control, storm

sealing, knot and sap streak sealing, and fire damage

restoration. If the definition is not changed, the commenter

requested that the shellac category be retitled to "Natural

resin/alcohol formulations" to avoid label and marketplace

confusion.

Response: Although the EPA recognizes the commenter’s

concern that the definition of shellac in the proposed rule is

broader than the traditional definition and, therefore, allows

additional natural resins, the EPA has decided to retain the

broader definition of shellac in the final rule (with the

exception of nitrocellulose resins as noted below). The EPA

believes that consumers can evaluate which natural resins (i.e.,

products that compete with the resinous secretions of the lac

beetle) are preferable for specific applications.

The commenter is correct that several States use the

traditional shellac definition, but the majority of the State

rules reviewed define shellac broadly as a coating "formulated

with natural resins." The review of the State rules also

revealed that nitrocellulose resins were excluded from several

State rules; some State rules also excluded gum resins. The EPA

has revised the shellac definition to exclude nitrocellulose

resins to avoid overlap with the Lacquer category. As to the

commenter’s concern that the use of the broader definition would

result in additional VOC emissions, the EPA believes that there

will be no significant emission increase because many States

already use the broader definition for the shellac category. 

The commenter also requested that if the shellac definition

was not changed, that the category be retitled to "natural

resin/alcohol formulations" to avoid label and marketplace

confusion. Even though the requested traditional definition of

shellac is not being used, the EPA has not retitled the Shellac

category. The EPA maintains that "shellac" is the most

appropriate term to use to define the category, which includes

the resinous secretions of the lac beetle as well as other
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natural resins, because this category name is consistent with

many State architectural coating regulations. In addition, the

term "shellac,” in the broader sense of the definition, is so

commonly recognized by both homeowners and professional users

that the EPA maintains that it may be more confusing to use any

other term.

2.2.3.13 Flow Coating

Comment: One commenter (IV-D-26) suggested that the

definition of flow coating be expanded to include other forms of

flow coatings, such as coatings that are applied to glass windows

in cars, residential buildings, and commercial buildings using a

flow machine. The commenter noted that window flow coatings are

used for the following purposes: (1) reduction of glare,

(2) reduction of heat-load on the room/vehicle, (3) reduction of

fabric fading, and (4) decorative appearance as these coatings

are frequently tinted.

Response: The EPA’s flow coating category was created for

coatings used by electric power companies to coat the surface of

transformer radiators and protect the utility transformer units

from corrosion. These coatings must be extensively thinned to

allow them to flow down into the radiator and create an even

film. Thus, this limited-use category requires a high VOC

content level and there is no substitute for this product. The

type of coatings described by the commenter, thus, would not be

considered a flow coating under this definition. Follow-up

information received from the commenter (IV-E-9) revealed that

their flow coating is predominantly field-applied to glass

windows (including building and automobile windows) by a flow

machine, but is sometimes applied in a shop environment. These

coatings are translucent liquid coatings used to provide

reduction of fabric fading, glare, and heat-load, as well as a

decorative appearance (tinted). Later follow-up information

(IV-E-9) revealed that very limited quantities are sold in some

regulated areas under the small container exemption of State

rules. Also, the commenter is currently developing a waterborne

formulation and believes it will have a compliant product soon. 
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Because of different performance requirements and uses for the

two types of coatings, the EPA has not expanded the definition of

flow coating as suggested. 

The architectural coating rule only applies to coatings

recommended for application to stationary structures outside of a

shop setting and consequently, would not cover coatings intended

solely for glass on automobiles or any applications in a shop

setting. However, coatings recommended for application to

building windows on-site would be considered architectural

coatings. These coatings would fall under either the flat or

nonflat coatings category with a VOC content limit of 250 g/l or

380 g/l, respectively, or the industrial maintenance category.

Comment: One commenter (I-F-1i) expressed that in the

definition of VOC content, the “Ws” term should be defined as

“weight of volatiles in grams,” not “weight of the VOC in grams.” 

Response: The definition of VOC content was corrected in

the proposed rule on September 3, 1996 (61 FR 46410); the

correction notice defines the “Ws” term as “weight of volatiles,

in grams.” The final rule includes this correction. 

2.2.3.14 Overlap Issues

Flow coatings.

Comment: A small manufacturer (IV-F-2g) of flow coatings

suggested adding a statement in the final rule that industrial

maintenance coatings sold as flow coatings are subject to the

limit for flow coatings.

Another commenter (IV-D-151) reported that most flow

coatings are industrial maintenance coatings that are thinned by

adding 0.5 to 1.5 gallons of solvent per gallon of product and

meet the VOC content of 450 g/l based on maximum recommended

thinning for spray, airless spray, brush, and roller

applications. The commenter explained that once the flow coating

category designation is made, the coating is no longer in

compliance because the most restrictive VOC content limit

applies. The commenter proposed that an exemption be made so

that industrial maintenance coatings used as flow coatings would
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be subject to the VOC content limit for flow coatings rather than

the lower VOC limit for industrial maintenance coatings.

A third commenter (IV-D-162) suggested that maintenance

coatings used for flow coatings be subject to the VOC content

limit for flow coatings (650 g/l) rather than the limit for

industrial maintenance coatings (450 g/l). The commenter

explained that extra thinner is necessary to impart required flow

properties.

Response: As stated in a previous response, the flow

coating category was created specifically to include coatings

used by electric power companies to maintain protective coating

systems on utility transformer units. Therefore, the EPA

intended that flow coatings manufactured for this purpose be

subject to the 650 g/l VOC content limit. Therefore, to avoid an

overlap of applicability for this category, the final rule

clarifies in §59.402(c) that flow coatings that also meet the

definition for industrial maintenance coatings are subject only

to the VOC content limit for flow coatings.

Antenna coatings.

Comment: One commenter (IV-D-101) asked if primers

formulated and recommended for application on antennas were

considered to be antenna coatings or primer coatings for purposes

of VOC requirements. The commenter explained that some primers

are specifically formulated to be transparent to the radio

frequency in use. The commenter implied that most of the primers

used on antennas that are manufactured by the commenter’s company

have VOC contents below 530 g/l (the EPA’s proposed limit for

antenna coatings) but would not meet the general primer category

VOC content limit (350 g/l) or the limit for industrial

maintenance coatings (450 g/l). Another commenter (IV-F-2) also

inquired about primers used on antennas and stated that their

antenna primer coatings cannot meet the limits for the primer,

sealer, and undercoater categories.

Response: The EPA considers primers specifically formulated

and recommended for application to antennas to be subject to the

VOC content limit of 530 g/l for antenna coatings because the
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specialty needs that antenna coatings have apply to primer and

top coat applications. For clarification, the EPA has added the

following to the list of exceptions to the most restrictive

requirement under §59.402(c): "Antenna coatings that also meet

the definition for industrial maintenance coatings or primers are

subject only to the VOC content limit in table 1 for antenna

coatings.”

Floor coatings and varnishes.

Comment: Several commenters (IV-D-07, IV-D-69, IV-D-76,

IV-D-85, IV-D-93, IV-D-180, IV-F-1i, IV-F-2 [two public meeting

commenters]) requested clarification regarding products included

in the varnishes and floor coatings categories and the associated

VOC content limits. One commenter (IV-D-85) suggested that the

EPA remove the floor coating category and keep all varnishes at

the 450 g/l limit in order to eliminate confusion and maintain

consistency. The commenter was perplexed that varnishes used as

floor coatings would be required to meet a lower VOC content

limit than varnishes used in other applications since floor

finishes require more abrasion resistance and would be easier to

develop within the 450 g/l level.

One commenter (IV-D-76) that produces wood gym floor

finishes stated that based on table 1 of the rule, several

different coating categories and VOC content limits could apply

to its product. The commenter requested the EPA make a

determination on the appropriate controls for that product. 

Two commenters (IV-D-85, IV-D-93) requested clarification on

whether the floor coating category includes clear floor finishes,

such as those used on gym floors, or paint (opaque), or both. 

One commenter (IV-D-93) asserted that only paints could be made

to comply with the proposed VOC content limit of 400 g/l for

floor coatings.

Another commenter (IV-D-07) indicated that the proposed VOC

limit for wood varnishes should be 450 g/l as provided in several

State regulations including New Jersey, Texas, Massachusetts, and

Metropolitan New York, and that they have developed a new formula

accordingly. Two commenters (IV-D-07, IV-D-69) referred to the
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clause in the proposed rule requiring a coating marketed in more

than one category to comply with the category with the lowest VOC

content limit, which would mean that varnishes used on floors

need to comply with the limit for floor finishes (400 g/l). The

commenters noted that lacquers are given an exemption even though

they are used on floors and have a higher VOC content. The

commenters suggested either giving varnishes an exemption or

inserting the word “opaque” in the floor coating definition to

correct the situation.

A small coatings manufacturer (IV-F-2) requested

clarification on whether the VOC content limit for floor

varnishes will be 400 g/l or 450 g/l. This company stated that

it would have a great deal of testing to do if the level is

400 g/l. The commenter indicated that it has marketed a 350 g/l

product in California but it was not commercially successful. 

The commenter stated that a 350 g/l product requires two coats on

a refinished floor to get the same gloss and performance as one

coat of the 450 g/l product, and that 450 to 500 g/l products

provide the best performance. Another manufacturer (IV-F-2)

noted that at the 400 g/l level, floor coatings can be applied in

coats that are too thick, resulting in coating “skin” and

underlying coating that never dries.

Four commenters (IV-D-153, IV-D-161, IV-D-185 and

IV-D-189/IV-F-1o) recommended that the EPA modify the rule to

clarify that the varnish coating category is meant to apply in

situations where a varnish is applied to a floor. As proposed,

one commenter (IV-D-189) noted that varnishes recommended for use

on floors could be interpreted to be floor coatings and thereby

subject to the more stringent floor coating VOC content limit.

The commenter stated that the floor coating category, which was

created during the regulatory negotiation, was never intended to

cover varnishes used on floors. Another commenter (IV-D-161)

pointed out that the floor coating category was developed during

negotiations as a high performance coating to be used in

residential settings in lieu of an industrial maintenance

coating, not to encompass all coatings that can possibly be used
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on floor surfaces. Another commenter (IV-D-185) stated that

varnishes used on floors still need to provide the performance

characteristics of other varnishes but with a higher degree of

abrasion resistance. The commenter maintained that the current

definition of floor coating lacks sufficient specificity and does

not address the potential for overlap between floor coatings and

varnishes. This problem only became apparent in subsequent State

rulemakings, such as in Kentucky, Oregon, and Washington where it

has been effectively addressed. According to the commenter, in

order to clarify the definition, Kentucky added the word “opaque”

to the definition. Alternatively, Oregon and Washington added an

exemption paragraph to clarify that the most restrictive limit

does not apply to varnishes used as floor coatings.

One commenter (IV-F-2) stated that the rule affects

approximately three-quarters of the gym floor products it

manufactures. Its products are floor varnishes that under the

proposed rule must meet the floor coatings VOC content limit of

400 g/l. The manufacturer stated that this coating should

instead be subject to the limit for varnishes, which is 450 g/l. 

Two commenters (IV-D-153, IV-D-207) recommended that the

definition of varnishes include floor varnishes in the 450 g/l

category so the tough, abrasion-resistant varnishes designed for

use on floors are not subject to the 400 g/l limit of the floor

coating category. One commenter (IV-D-207) stated that a floor

varnish must be low enough in viscosity for successful

application. Another commenter (IV-D-161) recommended adding the

following to §59.402(b): "Varnishes that may be recommended for

use as floor coatings shall only be subject to the VOC limit in

table 1 for varnishes." The commenter stressed that this

recommendation conforms with the rule interpretations industry

has been subject to throughout the country.

Four commenters (IV-F-2) suggested adding the term "opaque"

to the definition of floor coating. One of the commenters

suggested that if this change were made it would no longer apply

to clear floor varnishes. One of the commenters suggested that

the change would clarify whether a gloss floor paint would be
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classified as a floor coating. Two other commenters (IV-D-185,

IV-D-189) suggested inserting the word "opaque" into the

definition of floor coating and/or adding varnish to the list of

exceptions in §59.402(c) in order to eliminate confusion.

One commenter (IV-D-189) also suggested editorially revising

the proposed floor coating definition by moving and inserting the

phrase "with a high degree of abrasion resistance” after opaque

coating. The definition would then read as follows: "Floor

coating means an opaque coating with a high degree of abrasion

resistance that is formulated and recommended for the application

to flooring, including but not limited to decks, porches, and

steps." 

Another commenter (IV-D-169) recommended that opaque floor

paint be regulated at 400 g/l level and varnishes including those

used on floors should be regulated at 450 g/l and enamels at

380 g/l. The commenter pointed out that the word "gloss" may be

in the name “gloss floor varnish” so it should not be regulated

as a nonflat coating at 380 g/l.

Response: The EPA agrees that the floor coating category

was not intended to cover varnishes used on floors. Rather, the

EPA intended floor varnishes to be subject to the limit for the

varnish category. To clarify this intent, varnishes have been

added to the list of exceptions to the most restrictive

requirement under §59.402(c) as follows: "Varnishes and

conversion varnishes that are recommended for use as floor

coatings are subject only to the VOC content limit in table 1 for

varnishes and conversion varnishes, respectively." Also, the

editorial suggestion to move the phrase "with a high degree of

abrasion resistance" in the definition of floor coating has been

made. In addition, the EPA has added the term opaque to the

floor coating definition to further resolve the overlap concerns. 

With regard to the comments on wood gym floor finishes, these

coatings would be subject to the varnishes category with a VOC

content limit of 450 g/l.
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Anti-graffiti coating.

Comment: One commenter (IV-D-189) recommended that the EPA

remove the phrase "specifically labeled as an anti-graffiti

coating" from the definition of anti-graffiti coating. Two

commenters (IV-D-161, IV-D-189) requested that the EPA add

anti-graffiti coating to the list of coatings under § 59.402(b)

that are exempt from the most restrictive use provision. One

commenter (IV-D-189) pointed out that requiring containers of any

architectural coating to be specifically labeled with their

architectural coating category designation is redundant. If a

coating's use description recommends it for application to a

substrate to deter adhesion of graffiti and to resist repeated

scrubbing and exposure to harsh solvents, cleaners or scouring

agents used to remove graffiti, the use information by itself

identifies the coating as an anti-graffiti coating. 

Consequently, the commenter argued that there is no need to label

it as an anti-graffiti coating.

Response: The EPA agrees with the commenter that the phrase

"specifically labeled as an anti-graffiti coating" should be

removed from the definition of anti-graffiti coating to be

consistent with labeling requirements for other coating

categories and has revised the final rule to reflect this change. 

Also, to resolve any overlap issues in categorizing anti-graffiti

coatings used as industrial maintenance coatings, the EPA has

added anti-graffiti coatings to the list of exceptions to the

most restrictive requirement paragraph. This paragraph was added

because the EPA did not intend the more restrictive industrial

maintenance limit to apply to an anti-graffiti coating that

otherwise meets the definition of an industrial maintenance

coating.

Comment: Two commenters (IV-D-161, IV-D-189) expressed

concern about products that fall into more than one category and,

therefore, are subject to more than one VOC content limit. One

commenter (IV-F-2b) suggested, for coatings that fall into two

categories, that the manufacturer be allowed the option to market

the coating in the category with the higher limit. Two
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commenters (IV-D-161, IV-D-189) maintained that there is a

problem with the proposed wording in §59.402(b). This section

stated that the lower VOC content limit applies if "any

representation is made that the coating may be suitable for use

in more than one of the coating categories...." [emphasis added]. 

The commenters maintained that this implies the issue of

categorization is controlled by "suitability for use" rather than

which definition the coating meets. The commenters explained

that a coating designated for a particular use could be subject

to a more restrictive limit associated with another coating if it

is suitable for another use with a lower VOC content requirement. 

One commenter (IV-D-161) specifically mentioned that a coating

could be suitable for use on floor surfaces, but not meet the

floor coating definition. For example, a deck stain is

categorized as a stain rather than as a floor coating, since the

stain does not meet the definition for a floor coating, not

having sufficient film build to produce a high degree of abrasion

resistance. However, the wording of proposed subsection (b)

implies that a deck stain would need to meet the floor coating

limit. The commenters (IV-D-161, IV-D-189) recommended the

following change to §59.402(b): "...any representation is made

that the coating meets the definition of more than one of the

coating categories...." The commenters added that each of the

exceptions to the most restrictive limit provisions in

§59.402(b)(1)-(7) also provides "suitable for use" as the

criteria for the exception. The commenters suggested that each

of these provisions state either of the following: "...that may

also be recommended for use as...," or "...that may also meet the

definition for the particular category."

The commenters believed that these changes would alleviate

any misunderstanding of the intention of this section and of the

interpretation of the appropriate limits for a particular

coating.

Response: The EPA’s intent is for the coating category

definitions to be used to determine which category and VOC

content limit is applicable for a given coating. The EPA agrees
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that clarification is needed in the proposed § 59.402(b) and has

made the following change: "...any representation is made that

indicates that the coating meets the definition of more than one

of the coating categories listed in table 1 of this subpart, then

the most restrictive VOC content limit shall apply." This change

clarifies that categorization and the appropriate VOC content

limit are controlled by category definition, rather than its

"suitability for use" in more than one category. Also, as

suggested by the commenter, the wording for the exceptions to the

most restrictive limit provision which provides "suitable for

use" as the criteria for the exception in § 59.402(c)(1)-(7) of

the final rule has been revised accordingly to use more effective

language to read "...that meets the definition of ..." or

"...that are recommended for use as..." These changes are being

made because, as pointed out by the commenters, a coating may be

recommended for a particular use, but it may not meet the

category definition. For example, varnishes may be recommended

for use as floor coatings but they do not meet the final

definition of floor coatings (i.e., they are not opaque).

Comment: Four commenters (IV-D-161, IV-D-181, IV-D-189,

IV-F-1r) provided comments on categories that overlap. For

example, three commenters (IV-D-181, IV-D-189, IV-F-1r) cited the

following case where categories overlap and provided the

following for §59.402(b) of the rule:

Bituminous coatings and mastics that may be recommended for

use as primers or undercoaters shall only be subject to the

VOC level in table 1 for bituminous coatings and mastics.

Two commenters (IV-D-181, IV-F-1r) stated that certain roof

surface preparation products, known as “bituminous primers,”

require a lower viscosity than regular bituminous coatings in

order to fill the irregularities of the surface. These

commenters requested that the rule clarify that these bituminous

roofing products are not regulated under the primers and

undercoaters category. One commenter (IV-D-181) cited three

reasons for the clarification: (1) roof coatings and metallic

pigmented coatings are both defined as “non-bituminous”
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materials, (2) bituminous primers was identified as a possible

subcategory of bituminous coatings during the regulatory

negotiations, and (3) there is no chance that this clarification

would be susceptible to abuse because of the nature of bituminous

products. Another commenter (IV-F-1r) added that if bituminous

primers are classified under the more stringent primer and

undercoater limitations, their use would be prohibited. Also,

the use of a bituminous primer improves adhesion of the

bituminous and other materials placed on top of the primer. This

commenter believed that the EPA intended to include all

bituminous coatings in their own category and also urged the EPA

to add a bituminous “exception” under § 59.402(b).

Another commenter (IV-D-161) provided a list of categories

which overlap with the industrial maintenance category when used

in industrial, commercial, or institutional settings. The

commenter recommended inserting an exception paragraph in

§ 59.402(b) of the final rule for the following categories: 

antenna coating, bituminous coatings, high temperature coatings,

impacted immersion coatings, thermoplastic rubber coatings and

mastics, repair and maintenance thermoplastic coatings, and

pretreatment wash primers. The commenter maintained that

reformatting table 1 to reflect a subcategorization of the

industrial maintenance category will not work since they may be

legitimately recommended for use in residential as well as

industrial, institutional, or commercial settings. The commenter

recommended amending § 59.402(b) as follows:

Antenna coatings that also meet the definition for

industrial maintenance coatings or primers shall only be

subject to the VOC level in table 1 for antenna coatings. 

The commenter recommended adding clauses for the other

overlapping categories except for pretreatment wash primers for

which the commenter recommends amending paragraph (b)(6) as

follows: 

Pretreatment wash primers that may be recommended for use as

primers or that meet the definition for industrial
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maintenance coatings shall only be subject to the VOC level

in table 1 for pretreatment wash primers. 

Response: The EPA agrees that the most restrictive VOC

content limit was not meant to apply to these coating categories

that were developed for more specific applications in industrial,

commercial, or institutional settings (i.e., when a coating meets

both the industrial maintenance coating definition and one of the

more specific category definitions). Therefore, the EPA has

included language in the final rule to clarify its intent. 

First, the commenter’s suggestion for pretreatment wash primers

has been incorporated. Second, the EPA has added a new paragraph

in §59.402(c)(8) for varnishes to address additional situations

where a particular coating is recommended for more than one end

use. Third, the EPA has added an exception paragraph (c)(9) for

the following categories, which overlap with the industrial

maintenance category when used in industrial, commercial, or

institutional settings: anti-graffiti coatings, high temperature

coatings, impacted immersion coatings, thermoplastic rubber

coatings and mastics, repair and maintenance thermoplastic

coatings, and flow coatings. (As discussed in a previous

response on flow coatings, the Agency has added flow coatings to

this paragraph to avoid any possible overlap.) Although not

requested by the industry, the Agency has added flow coatings to

this paragraph to avoid any possible overlap. Paragraph (c)(9)

of § 59.402 in the final rule reads as follows: 

Anti-graffiti coatings, high temperature coatings, impacted

immersion coatings, thermoplastic rubber coatings and

mastics, repair and maintenance thermoplastic coatings, and

flow coatings that also meet the definition for industrial

maintenance coatings are subject only to the VOC content

limit in table 1 for their respective categories (i.e., they

are not subject to the industrial maintenance coatings VOC

content limit in table 1). 

 As discussed in the next comment and response, a separate

paragraph has been added in the rule for bituminous coatings and

mastics that are recommended for use as any other architectural

coating, including primers and undercoaters. Therefore, the

commenter’s recommended changes for bituminous coatings and
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mastics have not been made. As discussed previously, a separate

exception paragraph has been added in § 59.402(c) for antenna

coatings that overlap with industrial maintenance coatings and

primers.

Comment: One commenter (IV-D-161) recommended that the rule

clearly state that shellacs, lacquers, and bituminous coatings

are shellacs, lacquers, and bituminous coatings by definition and

that the VOC content limit for these chemically defined

categories should apply rather than any other coating category

for which they might also meet the definition. The commenter

noted that the definitions for lacquers, shellacs, and bituminous

coatings are based on their chemistry while most other

definitions are performance, use, and property oriented. Thus,

the commenter contended that these categories can essentially

overlap all categories because they can perform some specific

function such as primers, sealers, quick-dry sealers, roof

coating, undercoaters, nonflats, flats, stains, etc. 

The commenter argued that reformulation would affect

performance of the products and, therefore, they should not have

to meet the limits of other categories. The commenter

recommended revising § 59.402(b)(2) to read: "Lacquer coatings

that may be recommended for use as any other architectural

coating shall only be subject to the VOC level in table 1 for

lacquers." The commenter suggested that § 59.402(b)(4) be

changed similarly. The commenter also recommended adding

paragraph (b)(8) to read as follows: "Bituminous coating and

mastics that may be recommended for use as any other

architectural coating shall only be subject to the VOC level in

table 1 for bituminous coatings and mastics." 

A third commenter (IV-F-1j) stated that lacquers overlap

with other categories such as flats, nonflats, primers, and

stains. Another commenter (IV-F-2) also pointed out that

lacquers potentially overlap several categories.

Response: The EPA agrees with the commenters that in

general the definitions for lacquers, shellacs, and bituminous

categories are based on the chemistry of these coatings and can
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overlap many other categories in terms of their uses. Therefore,

the EPA has revised § 59.402(c)(4) for shellacs as recommended. 

For lacquers, paragraph (c)(2) has been amended as follows:

“Lacquer coatings (including lacquer sanding sealers) that are

also recommended for use in other architectural coating

applications to wood, except as stains, are subject only to the

VOC content limit in table 1 for lacquers.” As explained earlier

in this section, the EPA has concluded that lacquers used as

stains should meet the stain VOC content limit. Exception

paragraph (c)(15) has been added to § 59.402 for bituminous

coatings and mastics that are recommended for use as any other

architectural coating.

Comment: Two commenters (IV-D-161, IV-D-189) were concerned

about category overlap when industrial maintenance coatings are

recommended for application as floor coatings in an industrial,

institutional, or commercial setting. According to one commenter

(IV-D-161), the floor coating category was developed during the

regulatory negotiation as a high performance category to be used

in residential settings in case the industrial maintenance

coatings were precluded from use in such settings. To resolve

the overlap, one of the commenters (IV-D-189) recommended that

the definition of floor coating be amended by adding "in

residential situations" in the following manner: "Floor coating

means a coating with a high degree of abrasion resistance that is

formulated and recommended for application to flooring including,

but not limited to decks, porches, and steps in residential

situations." The commenter also recommended resolving the

overlap by amending proposed paragraph (b)(7) in § 59.402 to read

"Industrial maintenance coatings that may also be recommended for

use as primers or floor coatings shall only be subject to the VOC

level in table 1 for industrial maintenance coatings." 

One commenter (IV-D-161) also addressed the overlap issue in

the case where an industrial maintenance coating is recommended

to cover holes or cracks in an industrial, institutional, or

commercial application. This use potentially overlaps coatings

in the mastic texture coating category. To resolve this overlap,
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the commenter suggested amending paragraph (b)(7) in § 59.402 as

follows: "(7) Industrial maintenance coatings that may also be

recommended for use as primers or mastic texture coatings or

floor coatings shall only be subject to the VOC level in table 1

for industrial maintenance coatings."

Response: Similar to varnishes used as floor coatings, the

EPA did not intend that industrial maintenance coatings used as

floor coatings be subject to the more restrictive floor coatings

VOC content limit. For coatings intended for use in industrial

maintenance situations, the higher industrial maintenance coating

limit of 450 g/l applies, due to higher performance requirements. 

The same is true for industrial maintenance coatings intended for

use as mastic textured coatings. For industrial maintenance

coatings used as floor coatings, the overlap has been resolved as

suggested by the commenter by revising the definition of “floor

coating” to mean a coating with a high degree of abrasion

resistance that is formulated and recommended for application to

flooring including, but not limited to decks, porches, and steps

in residential situations. For mastic textured coatings, the

overlap has been resolved as suggested by amending the exception

paragraph as follows in § 59.402(c) of the final rule: "(7)

Industrial maintenance coatings that are also recommended for use

as primers, sealers, undercoaters, or mastic texture coatings are

subject only to the VOC content limit in table 1 for industrial

maintenance coatings." 

Comment: One commenter (IV-D-171) inquired about the

applicable category for a line of concrete waterproofing products

that it markets as primers that are applied to a substrate prior

to application of self-adhesive waterproofing membranes. This

product is typically applied to sub-grade concrete structures and

functions as a primer. The commenter explained that the

waterproof primers condition the chalky surface of the concrete

by coalescing concrete dust prior to application of the

membranes. According to the commenter, these primers do not

precede subsequent coatings since the waterproof membranes are

not coatings. In addition, these primers do not block
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efflorescence. The commenter asserted that the definition of

sealer is most appropriate based on the function of these

waterproofing primers as a surface conditioner. 

Response: The information provided by the commenter

indicates that these products function as sealers because the

coatings fulfill one of the purposes of a sealer listed in the

definition, “to condition chalky surfaces,” and therefore, appear

to be subject to the VOC content limit of 400 g/l for sealers.

Comment: One commenter (IV-D-161) requested that quick-dry

sanding sealers that meet the quick-dry primers, sealers and

undercoaters category level of 450 g/l be allowed to meet the

sanding sealers limit of 550 g/l. According to the commenter, an

overlap occurs because sanding sealers usually dry quickly to

allow complete surface preparation in the shortest time possible. 

The commenter recommended the addition of a new paragraph in

§ 59.402(b) to resolve any possible overlap: "Sanding sealers

that also meet the definition for quick-dry sealers shall only be

subject to the VOC level in table 1 for sanding sealers."

Response: The EPA agrees that sanding sealers that dry

quickly and therefore meet the definition for quick-dry sealers

should only be subject to the VOC content limit for sanding

sealers at 550 g/l because the sanding sealer category is a

specific application for which a higher VOC content is allowed. 

Therefore, § 59.402(c) has been amended by adding an exception

paragraph for sanding sealers to avoid this unintended overlap.

Comment: One commenter (IV-D-161) was concerned that some

waterproofing (treatment) sealers may not dry quickly enough to

meet the definition requirement for quick-dry sealers and, thus,

would be subject to the lower limits. The commenter stated that

this is unreasonable since the quick drying characteristic does

not reduce the need for the higher VOC content level associated

with the waterproofing (treatment) sealer category. The

commenter submitted the following new paragraph for § 59.402(b)

as a possible solution: "Clear waterproofing (treatment) sealers

that also meet the definition for quick-dry sealers shall only be
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subject to the VOC level in table 1 for clear waterproofing

(treatment) sealers."

The commenter also requested an exception to the most

restrictive level for quick-dry primers, sealers, and

undercoaters that meet the definition for primers and

undercoaters.

Response: The EPA agrees that the most restrictive limits

should not apply in situations where a coating is formulated for

a specific use, but unintentionally meets the definition of

another coating with a more restrictive limit. Therefore, the

EPA has amended § 59.402(c) to add exception paragraphs for

waterproofing sealers and treatments that also meet the

definition for quick-dry sealers; and for quick-dry primers,

sealers, and undercoaters that also meet the definition for

primers and undercoaters, as recommended by the commenter.

Comment: Two commenters (IV-D-04, IV-D-11) stated that the

EPA should publish the proposed coating definitions in the

Federal Register and extend the public comment deadline since the

proposed rulemaking did not include definitions for the

55 categories of coatings identified for regulation. As a former

regulatory negotiation committee member, one commenter (IV-D-04)

attested that significant issues surrounded definitions of

categories. Another commenter (IV-D-11) stated that different

definitions in existing State rules and the proposed rule's

categories creates confusion as to what coatings are to be

included in a particular category.

Response: At proposal in June 1996, the EPA made the

definitions for the coating categories available to the public

through the EPA's Technology Transfer Network (TTN) (a network of

electronic bulletin boards developed and operated to provide

information in air pollution control) and the architectural

coating rule docket. Then, on September 3, 1996 (61 FR 46410),

the EPA published the proposed regulatory text, including the

definitions and on October 8, 1996 (61 FR 52735) extended the

public comment period from the original closing date of August 30

to November 4, 1996. The EPA believes that this process gave
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notice to all interested parties of the types of issues and

concerns the EPA had in developing appropriate categories and

definitions. Based on public comments received on the proposed

rule, the EPA has revised several definitions in the final rule

for clarification. To the extent possible, the EPA has included

architectural coating definitions that are consistent with

existing State rules.

2.2.4 Coating Categories and VOC Content Limits

The EPA received a variety of comments on the VOC content

limits in the proposed rule. The bulk of the commenters targeted

specific categories. Some commenters requested that new

categories be added to the rule to accommodate specific coatings. 

In most cases, this type of request was based on the

manufacturer’s determination that the coating did not fit into

one of the proposed coating categories, or the proposed VOC

content limit for the category in which the coating fell was not

achievable by the particular coating. These comments are

summarized in section 2.2.4.2, Requests for New Categories. In

addition, some commenters stated that specific categories in the

proposed rule should have either lower or higher VOC content

limits. These comments are summarized in section 2.2.4.3,

Comments on Existing Categories.

In addition to category-specific comments, the EPA received

many comments that were more general. These commenters stated in

broader terms that the proposed VOC content limits were either

(1) appropriate, (2) too stringent, or (3) too lenient. One of

these commenters provided an alternative table of VOC limits for

1997 and a table of VOC limits for 2002. These comments are

summarized in section 2.2.4.1. Another commenter (IV-D-216) also

provided an alternative table of VOC limits for 24 coating

categories, which contained two phases, one for implementation

nationwide 3 years after promulgation of the rule and another for

implementation only in designated ozone nonattainment areas

6 years after promulgation of the rule.
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2.2.4.1 General

Comment: 

Introduction. Many commenters provided general comments on

the overall stringency of the VOC content limits in the proposed

rule. Seven commenters (IV-D-28, IV-D-181, IV-D-189, IV-D-206,

IV-D-213/IV-F-1f, IV-F-1k, IV-D-185/IV-F-1n) stated that the

proposed limits were reasonable and achievable. Thirteen

commenters (IV-D-22/IV-F-1a, IV-D-33, IV-D-34, IV-D-96, IV-D-117,

IV-D-118, IV-D-119, IV-D-126, IV-D-174, IV-D-188, IV-D-190,

IV-D-191, IV-D-215) stated that they did not support the rule

because the proposed limits were too lenient and should be made

more stringent. Eight commenters (IV-D-12, IV-D-44, IV-D-110,

IV-D-115, IV-D-158, IV-D-180, IV-D-192, IV-F-2a) stated that the

proposed limits were too restrictive and should be made less

stringent. One commenter (IV-D-216) argued that their table of

alternative VOC limits represented the most environmentally

beneficial, cost-effective, and technologically and economically

feasible method for regulating architectural coatings consistent

with the requirements of section 183(e) of the Act.

General comments in support of the proposed rule. Seven

commenters (IV-D-28, IV-D-181, IV-D-189, IV-D-206,

IV-D-213/IV-F-1f, IV-F-1k, IV-D-185/IV-F-1n) stated that the

limits in the proposed rule were reasonable and achievable.

Two of the commenters (IV-D-28, IV-D-185/IV-F-1n) stated

that the proposed VOC limits represented best available controls

(BAC). One of the commenters (IV-D-28), a supplier of industrial

maintenance coatings and certain other categories of coatings

listed in the proposed rule, pointed out that the EPA has

selected BAC based on all available data, State rules,

information from the regulatory negotiation, industry inputs, and

the EPA’s own expertise. The commenter recommended that the EPA

maintain the proposed VOC content limits since they were

developed using the best available data, given the time and cost

restrictions. 

One commenter (IV-D-185/IV-F-1n) voiced strong support for

the proposed rule. The commenter stated that, for stains,
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varnishes, and waterproofing sealers, the proposed VOC content

limits would achieve maximum feasible reductions in VOC emissions

that are both technologically and economically feasible. The

commenter stated that the standards for these categories were

tough, but fair, and will allow the industry to continue to

produce quality products and to continue to formulate and sell

effective products that can provide satisfactory performance. 

The commenter stated that the proposal struck an excellent

balance between the competing perspectives that have been

expressed about the feasibility of achieving VOC reductions.

One commenter (IV-D-189), a national trade association

representing approximately 500 paint and coatings manufacturers,

raw material suppliers, and distributors, stated that the

proposal is fundamentally consistent with its position that a

national rule must be economically and technologically feasible. 

The commenter stated that the rule strikes a fair balance between

environmental concerns and the need to maintain the economic

viability of the industry. The commenter stated that, for the

most part, the proposed coating categories are consistent with

the recommendations that the organization submitted to the EPA in

April 1995. Also, the commenter stated that it appreciated the

EPA’s proposal of VOC requirements which recognize the need for

(and allow the continued use of) solventborne coatings in certain

specialty areas, as well as in some more general usage categories

such as industrial maintenance, floor coatings, rust preventative

coatings, concrete protective coatings, and nonflat coatings.

The commenter stated that the rule adequately addresses the fact

that the same architectural coating must be able to perform in

all regions and climates of the United States.

Another commenter (IV-D-213/IV-F-1f), representing a

national association of coating users, stated that the proposed

table of standards would not be disruptive for the majority of

the coatings its members are using. The commenter stated that

the organization has a membership of over 3,000 professional

coating contractors and that every coating that is on the market

is used by some of its members. The commenter stated that the
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proposed table of standards fit squarely within current

technologies and is consistent with various existing State

regulations. The commenter stated that further reductions in the

VOC content limits would adversely affect coating performance and

could ultimately result in more VOC emissions due to a shorter

coating lifetime.

One commenter (IV-D-206), representing a national trade

association with a membership of over 180,000 architectural

coating users, stated that the proposed table of VOC content

limits will not significantly increase construction costs and

will not appreciably reduce coating performance. The commenter

maintained that the limits for interior and exterior nonflat

alkyd trim paint, and many other coatings, are as low as they can

be without adversely affecting performance.

General comments opposing the proposed rule -- too lenient. 

Thirteen commenters (IV-D-22/IV-F-1a, IV-D-33, IV-D-34, IV-D-96,

IV-D-117, IV-D-118, IV-D-119, IV-D-126, IV-D-174, IV-D-188,

IV-D-190, IV-D-191, IV-D-215) stated that they did not support

the proposed rule because the VOC content limits were too lenient

and, therefore, do not represent BAC.

One commenter (IV-D-190) explained that the EPA’s

determination of BAC does not reflect the substantial

developments in paint and coatings technology since 1990. The

commenter quoted public hearing comments indicating that raw

material suppliers and large paint companies have developed new

low-VOC technologies and maintained that the EPA has not asked

these companies exactly what their capabilities are. The

commenter stated that the dominant companies are abandoning lowVOC coating development since existing products already

comfortably satisfy the proposed VOC content limits. The

commenter asserted that the Act imposes a duty on the EPA to

identify systematically these lower-VOC technologies. Another

commenter (IV-D-191) stated that the data the EPA used to

determine BAC is outdated. The commenter stated that costeffective technologies currently exist in just about every

category that have significantly lower-VOC contents than those
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proposed by the EPA. Both commenters (IV-D-190, IV-D-191)

pointed out that the EPA stated in the preamble to the proposal

that “EPA was aware of numerous examples of low VOC systems which

perform better than the traditional higher VOC systems.” 

Two commenters (IV-D-33, IV-D-215) claimed that the proposed

rule reflects the status quo, and manufacturers will merely

continue to produce and sell products at existing VOC content.

Nine of the commenters (IV-D-22/IV-F-1a, IV-D-33, IV-D-34,

IV-D-96, IV-D-126, IV-D-174, IV-D-188, IV-D-190, IV-D-191) cited

the existence of more stringent State and local architectural

coating regulations that have been in place for many years as

evidence that the proposed limits are not BAC. One commenter

(IV-D-22/IV-F-1a) noted that over 170 manufacturers are already

meeting tighter standards that have been in effect for almost a

decade in most metropolitan areas of California, as well as

several other States [no reference cited]. One commenter

(IV-D-34) pointed out that the technology assessments published

for the 1989 Suggested Control Measure (SCM) by the California

Air Resources Board (CARB) and the California Air Pollution

Control Officers Association (CAPCOA) indicated the availability

of coatings in various categories that are below the proposed

limits. One commenter (IV-D-33) pointed out that several air

quality management districts in California have stricter limits

and manufacturers have complied with these limits for years. 

One commenter (IV-D-191) stated that the proposed rule

represents a “least common denominator” approach to rulemaking

and fails to set standards at levels that will move the industry

forward sufficiently to reduce the VOC content of coatings. 

Several commenters (IV-D-22/IV-F-1a, IV-D-96, IV-D-174)

stated that the rule does not obtain the VOC reductions that are

achievable, falls short of State VOC reduction goals, and may

result in States adopting more stringent control measures for

this source category. One commenter (IV-D-22/IV-F-1a) stated

that State rules may have differing requirements, leading to the

administrative, technical, and marketing problems the EPA hoped

to avoid with a Federal rule. Two commenters (IV-D-22/IV-F-1a,
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IV-D-174) added that because the rule is less stringent than

existing State regulations, it may force them to seek VOC

controls on other source categories that may not be as costeffective. 

One commenter (IV-D-22/IV-F-1a) provided an alternative

table of VOC content limits with more stringent limits for

several categories that would achieve a 30 percent reduction on a

solids basis. The commenter stated that the more stringent VOC

limits were based on the 1989 CARB Suggested Control Measure. 

The commenter also omitted several specialty coating categories

that it deemed to have unenforceable definitions and readily

available low-VOC alternatives. The commenter stated that the

more stringent levels represent BAC and, therefore, should be

reflected in the rule. (The commenter also suggested a second

phase of VOC limits that would take effect in the future. For

comments and responses regarding the suggested second phase of

VOC limits see section 2.6). Six commenters (IV-D-33, IV-D-34,

IV-D-117, IV-D-118, IV-D-126, IV-D-215) supported the more

stringent VOC limits presented by commenter IV-D-22/IV-F-1a and

stated that they are a fair and responsible compromise based on

achievable limits. The commenter (IV-D-22/IV-F-1a) stated that

if the EPA adopts the proposed standards in table 1 of the rule,

almost all State and local agencies will accept the national rule

as a sufficient level of control rather than seeking more

stringent limits. 

General Comments Opposing The Proposed Rule -- Too

Stringent. Nine commenters (IV-D-12, IV-D-44, IV-D-110,

IV-D-115, IV-D-158, IV-D-175, IV-D-180, IV-D-192, IV-F-2a) stated

that the VOC content limits in the proposed rule were too

restrictive and should be made less stringent. These commenters

stated that the limits should be raised because low-VOC products

(i.e., products meeting the proposed standards) do not perform as

well as higher (non-compliant) VOC products.

One commenter (IV-D-110) stated that raw material suppliers

are working diligently to provide new technology to paint

manufacturers to re-develop products. However, at this point,
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the commenter claimed that it has not been able to achieve the

quality, durability and pricing to replace these products. 

Another commenter (IV-D-115) concurred that available paint raw

materials are not adequate to reformulate every non-compliant

coating the paint industry offers and still meet performance

requirements. The commenter expressed concern that emission

limits on high-quality protective coatings that are too strict

would prohibit their production and use. The commenters

(IV-D-110, IV-D-115) did not cite any specific coating categories

for which reformulation was not achievable or adequate to meet

performance needs, but rather argued their points in general

terms.

 Two commenters (IV-D-12, IV-D-110) questioned the

performance characteristics of low-VOC coatings. One commenter

(IV-D-12) recommended that the coatings industry conduct further

performance studies. The commenter indicated that its laboratory

experience with low-VOC coatings shows that they are usually

thick and that the formulas would require considerable thinning

to apply. The commenter further maintained that over-thinning is

a frequent problem with many contractors, which can have several

consequences: coatings that dry too fast, increased runs and

drips, shortened shelf life due to the settling of heavier

pigments, effects on opacity, and may cause polymerization. The

commenter recommended that the rule require manufacturers to

produce paint that is pre-thinned and ready to apply to solve

issues associated with over-thinning. Also, the commenter

explained that using low-VOC coatings would be counterproductive

if the use of the coatings result in more emissions due to more

coatings applied, more thinners needed, and more frequent

applications required. Another commenter (IV-D-180) added that

when establishing VOC content limits, the EPA should consider

that higher-VOC coatings that only require a single application

could result in less total VOC emissions than using a low-VOC

coating that does not perform as well. 

A small coatings manufacturer (IV-F-2a) with 13 employees

and $6 million in sales stated that they do not know how they
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could reformulate the 40 percent of their coatings that do not

meet the proposed limits since any changes they make will affect

the coating performance. Currently the coatings they sell in

areas with architectural coatings regulations (e.g., regulated

areas of New York and New Jersey) do not perform as well as their

other coatings and contain more long oil alkyds with poor gloss

properties. 

One commenter (IV-D-158) stated that the proposed rule would

require a massive reformulation of products in the paint and

coating industry. The commenter claimed that some organizations

were supporting lower limits based on improper data or based on

environmental conditions which do not represent circumstances in

other areas.

One commenter (IV-D-216), representing an organization of

local and regional coating manufacturers, submitted an

alternative national rule for architectural coatings, which

included a table of VOC content limits for 24 coating categories. 

The table contained one phase of VOC content limits for

nationwide implementation 3 years after promulgation of the

regulation and another phase for implementation only in

designated ozone nonattainment areas 6 years after promulgation

of the regulation. The commenter stated that its approach would

treat people equally, address the demands of section 183(e) of

the Act, and allow the forces of supply and demand to run the

market. The commenter argued that implementing its first phase

of VOC content limits would reduce VOC emissions from

architectural coatings nationwide by 18 percent, and implementing

the second phase would reduce emissions in designated

nonattainment areas by 32 percent. The commenter asserted that

its approach promoted reformulation, rather than substitution,

and therefore, it is the most effective system for obtaining VOC

emission reductions. The commenter maintained that its approach

addressed the substitution problem by establishing emission

limits that are achievable through reformulation using current

technology.
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Response: The EPA believes that the final rule represents

best available controls (BAC). The Act defines “best available

controls” as “the degree of emissions reduction that the

Administrator determines on the basis of technological and

economic feasibility, health, and energy impacts, is achievable.” 

The statute thus explicitly authorizes the EPA to take into

consideration various factors and to exercise its discretion to

choose achievable VOC content limits. In developing the rule,

the EPA considered many factors in evaluating the economic and

technological feasibility of different VOC content levels and

different degrees of product reformulation. These factors

included:

& Limits in State/local regulations

& VOC content and sales information

& Performance considerations 

& Cost considerations

& Market impacts 

The sources of information for these factors included:

& Pre-proposal letters 

& The 1992 industry survey (collected 1990 data)

& Public comments on the proposed rule

& Follow-up discussions with commenters to gather

additional technical information

& EPA expertise

& State/local regulations and pre-proposal discussions

with State/local regulators

& Input from coating manufacturers and other stakeholders

Considering all these factors, the EPA concluded that the VOC

content limits in table 1 of the rule, along with the exceedance

fee provisions and the tonnage exemption, represent BAC for

architectural coatings. The EPA’s process for developing BAC was

described in the proposal preamble (61 FR 32737).

Technical feasibility and coating performance issues. 

Throughout this rulemaking, there has been debate over the degree

to which VOC content levels in architectural coatings can be

reduced and on the performance characteristics of low-VOC

coatings. The term "performance" means the coating qualities
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that are acceptable to consumers and that maximize the interval

required between recoating. Performance is particularly

difficult to assess. As discussed in the preamble to the

proposed rule (61 FR 32738), these acceptable qualities can vary

significantly depending on the consumer and the coating category. 

There is no consensus within the architectural coatings industry

on standards by which to evaluate acceptable coating performance. 

Therefore, the EPA requested comment on the technical feasibility

of the limits in the proposed table of standards and on

performance issues. The proposal requested documentation, tests,

and factual evidence to support or refute claims about

performance and the technical feasibility of low-VOC systems. 

The EPA evaluated all information that was submitted by

commenters pertaining to the feasibility of the rule and sought

additional information that was reasonably available. In

evaluating the degree of emission reduction that represents BAC,

the EPA took into consideration that these requirements would

apply to all areas of the country and to all manufacturers of

architectural coatings within a specific time frame (i.e.,

approximately 1 year from promulgation). Based on the public

comments received, a number of changes were made to the proposed

rule. These changes are discussed in section 2.2.4 (Coating

Categories and VOC Content Limits) of this document. In some

cases, commenters claimed that the proposed limits in the rule

were not feasible or did not represent BAC, but provided no data

to support the general claim. In such cases, the EPA sought

additional information that was reasonably available and

considered the comments in the context of the overall BAC

determination, but often found no basis for making substantive

changes to the proposed rule.

Relationship of BAC to State regulations. State and local

regulations were one of the factors used by the EPA to develop

BAC. As stated in the proposal preamble (61 FR 32737), State and

local architectural coating requirements were used prior to

proposal as a starting point in determining “what categories and

associated VOC levels might constitute the degree of emissions
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reduction that represents BAC.” After proposal, the EPA used

State and local architectural coating requirements as a factor in

the evaluation of public comments on VOC content limits.

However, the EPA does not agree with commenters who believe

that at a minimum BAC for the national rule should be equivalent

to or more stringent than the lowest emission limits that exist

in any State regulation (as presented in a table of standards by

one commenter). In the development of a national rule under

section 183(e), the EPA has the obligation to determine that the

emission limits are technologically and economically feasible on

a national scale. State and local VOC limits are based on

coating performance under the local meteorological conditions and

patterns of coating demand, some of which may be very different

than in other locations. Moreover, based on local air quality

and existing regulatory programs, a State or local agency may set

rules based on a balancing of technological, economic, and

environmental factors that might differ from the balance

appropriate for a national rule. 

Therefore, the EPA departed from the State and local

requirements where other factors, such as information on VOC

content and sales, performance, costs, and market effects,

indicated that the limits were not technologically or

economically feasible on a national scale.

The role of the exceedance fee and tonnage exemption in BAC.

While the EPA believes that the technology exists to meet the

limits in table 1, some manufacturers may need more time to

obtain the necessary technology for some coatings. Still other

manufacturers may choose not to reformulate some of their

specialty products that are produced in low volume. The

exceedance fee and tonnage exemptions were adopted into the final

rule, in part, to minimize impacts on the supply of coating

products. The exceedance fee (discussed in section 2.4) is

intended to allow manufacturers and importers additional time to

develop low-VOC formulations while providing appropriate economic

incentives for most manufacturers ultimately to comply with the

VOC limits of the rule. The tonnage exemption (see
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section 2.2.1.2) is intended to allow manufacturers and importers

the flexibility to continue to market certain low-volume product

lines where reformulation of a specialty product used for unique

applications may not be cost-effective. The EPA believes that

all available data indicate that the system of regulation adopted

in the final rule, consisting of VOC content limits, an

exceedance fee provision, and a tonnage exemption, reflects BAC

for the architectural coatings category.

Consideration of new low-VOC coatings. The EPA recognizes

that the 1992 industry survey that the EPA used as one of the

factors for developing BAC collected 1990 data. Although the

data in this survey is now 8 years old, it still represents the

most complete survey of the architectural coating industry (it

captured approximately 75 percent of the coating volume). In

addition, the industry survey was only one of the many factors

used in determining BAC. Information on advances since 1990 were

obtained from over 300 preproposal letters, over 200 public

comment letters, over 40 follow-up telephone calls, and

information obtained from State regulatory agencies. The EPA

believes that the final rule represents BAC based on the survey

database and other data available to the EPA. 

The EPA acknowledges that there are coating technologies in

existence with VOC contents lower than those listed in table 1. 

However, section 183(e) of the Act does not require the EPA to

set BAC at the level of the lowest-VOC product. It requires that

the EPA determine BAC based on “the degree of emissions reduction

that the Administrator determines on the basis of technological

and economic feasibility, health, and energy impacts, is

achievable.” The statute thus directs the EPA to consider and

balance a number of factors in establishing the appropriate

controls. To determine whether a more stringent rule would meet

the criteria for BAC in the future, the EPA would need to

undertake additional study of the architectural coatings

category. See section 2.6 for discussion of such a study.

Comment: Two commenters (IV-D-119, IV-D-191) criticized the

rule as being too lenient. Both recommended setting more
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stringent emission limits that are more technology-forcing and

using innovative mechanisms (e.g., emissions trading and emission

fees) to allow needed flexibility. One commenter (IV-D-191)

stated that innovative mechanisms such as persuasive emission

fees and other new approaches were absent from the proposed rule. 

Another commenter (IV-D-119) believed that the EPA is giving up

an opportunity to hold sources to strict standards while allowing

flexibility through the use of market-based programs, such as the

EPA's draft Open Market Trading Rule. The commenter suggested an

alternative format of strict limits with the opportunity and

flexibility of emissions trading. The commenter argued that

emissions trading provides incentives for sources that have lower

compliance costs to over-control and sell the excess reduction

credits to sources with higher compliance costs. This allows for

cost-effective controls and alleviates the need to set standards

to accommodate the “lowest common denominator.” 

Response: Under section 183(e), the EPA has the obligation

to demonstrate that the architectural coating rule is achievable,

considering technological and economic feasibility and other

factors. The EPA has set the VOC content limits at what it

believes to be sufficiently stringent levels, taking into

consideration these factors. In doing so, the EPA has also

provided appropriate mechanisms to make the limits achievable. 

The exceedance fee provision and the tonnage exemption provide

the necessary flexibility for the level of the emission limits in

the rule.

The exceedance fee allows more time for manufacturers to

develop new product formulations and provides a less costly

compliance approach for manufacturers selling low volume products

for which it is not cost-effective to reformulate. The EPA

believes that the fee rate is sufficiently persuasive to

encourage manufacturers ultimately to reformulate to the levels

of the rule. The fee rate is at the upper end of the range of

incremental VOC reduction costs imposed by regulations on other

industries. At this time, the EPA does not believe that

providing any additional flexibility (through emissions trading
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or other approaches) justifies more stringent emission levels in

the rule.

Several alternative market-based approaches were considered. 

The emission fee was considered the most appropriate due to

simplicity, and it would be less complex and burdensome for this

industry than emission trading schemes, due to the changing

nature of the product lines and the complexity of the

recordkeeping that would be required for emission trading.

Comment: One commenter (IV-D-96) stated that, were a State

to repeal its more stringent rule in place of the national rule,

it might trigger a legal challenge that the rule encourages

backsliding, which contravenes provisions in the Act.

Response: Promulgation of a Federal architectural coatings

rule in no way forces a State to repeal any regulation that

requires more stringent VOC emission limits. The Act expressly

preserves the right of States to adopt regulations that are more

stringent than Federal rules. Any State, therefore, that chooses

to relax its regulations following promulgation of today’s

Federal rule, does so at its own choice. The commenter is

correct that “no backsliding” provisions under the Act prohibit

relaxation of VOC emission limits that result in an increase in

emissions in certain nonattainment areas. If existing

regulations for architectural coatings are relaxed in such areas,

the backsliding provisions would require contemporaneous emission

reductions from other sources to balance the emission increase

from architectural coatings. Some States have laws that prohibit

their emission standards from being more stringent than the

Federal rules. The backsliding requirements, where applicable,

would apply in these circumstances as well.

Comment: One commenter (IV-D-191) stated that the

negotiated approach to rulemaking had produced a significantly

stronger standard which the EPA has ignored in the proposed rule.

Response: The EPA attempted to use the regulatory

negotiation procedure to develop the basis of the proposed rule

(see section IV.B of the proposal preamble). During the

negotiations, stakeholder groups proposed a number of standards
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with varying levels of stringency. Based on these proposals, the

facilitator and the EPA prepared a number of different options

for the potential regulation. In the end, the negotiating

committee could not reach agreement on a rule, and the regulatory

negotiations concluded without consensus. Therefore, the

commenter is not correct that the negotiated approach produced a

stronger standard.

Comment: Three commenters (IV-D-22, IV-D-33, IV-D-34)

expressed concern that the less stringent limits in the Federal

rule would undermine local rulemaking efforts.

Response: Because of the severity of their ozone problem,

some areas may need more emission reductions than provided in the

architectural coatings rule in order to meet the national ambient

air quality standard for ozone. The Federal rule does not

prohibit the adoption of more stringent State rules.

The Federal rule represents best available controls on a

national basis. The EPA believes that the rule represents a

control level that is reasonable under the range of

technological, environmental, and economic conditions that exist

nationwide. In developing their own rules, States consider only

local conditions and do not have to account for national patterns

of consumer demand, varying weather and atmospheric conditions,

or other technological or economic factors that affect the

reasonableness of controls. At the State level, therefore, local

circumstances may lead to different conclusions as to the degree

of control that is appropriate for some coatings. The Federal

rule should not be interpreted as signifying that more stringent

levels of control are not feasible under some circumstances.

Comment: One commenter (IV-D-190) stated that the BAC

determination methodology was flawed because the EPA did not

perform an independent survey of the coatings industry.

Response: The survey of coatings manufacturers was only one

of several factors considered in developing the final rule. The

survey was conducted during the regulatory negotiation. The

questionnaire was developed by the EPA and the committee. The

survey was distributed and compiled by the National Paint and
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Coatings Association (NPCA). The NPCA hired an independent

contractor to compile and summarize the responses to protect the

confidentiality of certain information in the survey.

The EPA has no reason to believe that the information from

the survey is flawed. The EPA believes that the survey

represents the best compilation of coatings data available today.

The Act does not require that all data used in a rulemaking be

collected by the EPA. The EPA can utilize any data that are

deemed by reasonable judgment to be accurate and representative

of the industry. 

Comment: According to one commenter (IV-D-190), the

regulatory development process was merely a discussion between

the EPA and the National Paint and Coatings Association (NPCA),

which represents manufacturers pushing for lenient limits. The

commenter stated that no labor, environmental, or consumer groups

had submitted comments or evidence. 

Response: The EPA encouraged participation of all

interested parties throughout the rulemaking process. In

developing the proposed rule, the EPA met with many stakeholders

and shared drafts of the rule with a number of representatives of

industry, environmental groups (e.g., Natural Resources Defense

Council), consumer groups, labor organizations, and health

organizations. After proposal, the EPA notified these same

groups about the Federal Register notice to ensure their

opportunity to comment. More than 200 comment letters were

received in response to the proposed rule. All significant

comments were evaluated and treated as equally important.

Comment: Regarding the availability of alternative

compliance systems, one commenter (IV-F-1e) listed three

suppliers who offer low- or no-HAP solvents that are still

100 percent VOC. The products have a vapor pressure limit that

meets the requirements for the consumer product adhesive

regulations but not the architectural coating VOC rule.

One commenter (IV-D-32) listed several circumstances where lowVOC coatings have been introduced since 1990 with favorable

consumer response. These products include low and no-solvent
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flat and non-flat interior coatings, no-VOC exterior coatings,

and industrial maintenance coating category products. According

to the commenter, the dominant view within the resin

manufacturing and coating manufacturing industries is that new

technical advances permit dramatic further reductions in the VOC

content of architectural coatings with no appreciable loss of

performance. Another commenter (IV-D-73) added that tremendous

VOC reductions have been made with the market shifting to latex

paints. One commenter (IV-D-175) stated that the coatings

industry is doing a relatively good job moving to non-solvent

base latex coatings. The commenter also stated that recent

technological advances and market forces are driving the industry

to latex waterborne systems. The commenter stated that only

about 15 percent of the products produced by the company are

solvent-based.

Response: The comments support the EPA’s position that many

low- and no-VOC coatings are available and that additional ones

are being developed that can meet performance needs as well as

the requirements of the rule. Based on other available

information and comments received, the EPA believes that it is

technologically feasible to achieve the VOC content limits for

coating categories required in the final rule, and these comments

provide further support.

Comment: One commenter (IV-D-45) stated that one problem

with the proposed regulation is that the architectural coating

industry is not all single purpose market type sales and implied

that the proposed rule should accommodate coatings that could be

classified under multiple categories. 

Response: The EPA acknowledges that many architectural

coatings are used for multiple purposes. In the final rule, the

EPA accommodates many multiple-use coatings in § 59.402(b) by

exempting those type coatings from the most restrictive VOC

content limit if that limit was not intended to apply. In fact,

the EPA has greatly expanded that section in the final rule in

response to comments regarding category overlap issues. 
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Comment: One commenter (IV-D-02/IV-F-1[l]) maintained that

the EPA should incorporate the concept of different standards for

different seasons into the rule. The commenter pointed out that

VOC emissions contribute to ozone formation primarily in late

summer and early fall. The commenter suggested that the EPA

allow higher VOC coatings during the non-ozone seasons. The

commenter maintained that this would allow small businesses

selling into high-VOC niche markets to continue to operate. The

commenter (IV-F-1[l]) also stated that failures of low VOCcoatings are more prevalent in the winter season, when ozone

exceedances rarely, if ever, occur.

Response: Although the EPA appreciates the reasoning behind

this comment, it would be neither practical nor enforceable to

set different standards for different seasons. The architectural

coating rule sets standards for coating manufacturers’ sales and

distribution of coatings rather than end users’ application of

these coatings. The rule has no mechanism to constrain when end

users can apply these coatings. In addition, such a provision

would not be practical to apply to the end users in the

architectural coating sector since these end users include

homeowners and a variety of contractors applying coatings at a

variety of locations throughout the year. Enforcement of a

provision limiting coating application to non-ozone seasons would

require monitoring of these types of applications and locations,

which would not be practical. Use of an ozone season approach

would also be very burdensome for manufacturers and importers

because they would have to produce different lines of products

for the ozone season and non-ozone season, and begin tracking

products to insure that they were only distributed and sold

during the appropriate season at the given locale. The EPA does

not believe that such burdens, especially for small businesses,

would be insignificant. 

Comment: One commenter (IV-D-28) requested that the EPA

make two changes to Table 1 - Architectural Coating VOC Content

Level. First, the commenter suggested that the EPA should adjust

the figures on the table to two significant figures because the
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method used to determine compliance (Method 24 of appendix A of

part 60) is only reliable up to two significant figures. Second,

the commenter suggested the EPA should add a second column to the

VOC content table to list the VOC content limits in non-metric

form. 

Response: Based on the commenter’s suggestion, the EPA has

added a column for non-metric (English) units to table 1. The

metric units will be used for enforcement. The EPA is using two

significant figures in table 1 of the final rule for the VOC

content limits, the same as in the proposed rule. 

Comment: One commenter (IV-D-28) suggested an alternative

control approach whereby each manufacturer would reduce its

overall VOC emissions by 20 percent from a 1990 baseline by

July 1, 1996, by making reductions in products chosen by the

manufacturer. The commenter suggested that this would foster

cost-effectiveness, and an annual certification of product mix

and end-use VOC content could provide regulators with an adequate

verification and enforcement mechanism. According to the

commenter, any increase in sales volume that had the effect of

raising emissions over the 20 percent reduction during 1 year

would have to be compensated by a lower VOC product mix the

following year.

Response: The EPA appreciates the commenter's suggestion. 

However, a similar approach was explored during the regulatory

negotiation, and it became clear that too many problems made the

approach unworkable, such as establishing a proper baseline, the

potential inequities between small and large businesses, and

significant administrative burdens.

Comment: One commenter (IV-F-1e) stated that in order to

warranty the effectiveness of their water-based products, they

recommend the product be applied at ambient temperatures of

50 F or higher and under stringent humidity conditions. (The o

commenter did not cite a specific example.) The commenter

pointed out that construction does not stop in the northern U.S.

during the winter when temperatures are at 30 F or less. The o

commenter asserted that this issue needs to be addressed.
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Response: The EPA agrees that certain coatings,

particularly waterborne products, must be applied within a

certain temperature range and that humidity can also be a

consideration. In fact, those were considerations in the EPA's

decision to create two new coating categories: zone marking and

concrete curing and sealing compounds. In general, however,

coating manufacturers need to assess these factors and make the

coating users aware of any special requirements to ensure

successful application of the coating product. Moreover, the EPA

notes that solventborne coatings also have limitations in use

under severe conditions. 

2.2.4.2 Requests for New Categories 

Lead-based paint encapsulant and asbestos encapsulation.

Comment: One commenter (IV-D-172) requested that the EPA

create a new category for lead-based paint encapsulant and

asbestos encapsulation products with a 350 g/l VOC content limit. 

However, in follow-up information (IV-G-26), the commenter

revised their position to request that the EPA establish a VOC

content limit of 250 g/l for these two types of products. The

company's primary lead-based encapsulant has a VOC content of

141 g/l. The commenter stressed that there may be performance

limitations for water-based coatings below 250 g/l for specific

end-use encapsulation problems such as for floor coatings. The

commenter explained that these water-based products have special

coalescent, wet-edge, freeze-thaw, and viscosity properties. The

commenter implied that these formulations will prevent asbestos

dust and aged lead paints from contaminating the environment. 

The commenter mentioned that the products are in nationwide use

and that the EPA has recently published guidelines for the use

and application of lead-based paint encapsulant. 

Response: In follow-up information (IV-G-26), the commenter

stated that the company had been successful in reformulating its

lead-based paint encapsulant and asbestos encapsulation products

to meet a VOC content level of 250 g/l, therefore the EPA sees no

benefit to creating a separate category for these two product
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types. In the absence of a specific category, these products are

subject to the flat or nonflat category (depending on the gloss

level of the coating). For flat coatings, the VOC content limit

is 250 g/l and for nonflat coatings, the VOC content limit is

380 g/l. The EPA obtained follow-up information from another

manufacturer (IV-E-60) that indicated that low-VOC encapsulation

products are available. Also, according to a September 1993

article on asbestos encapsulants (IV-B-4), one company has

successfully recoated old siding containing asbestos with a

system that meets the most stringent regulations for VOC. The

system consists of water blasting, spot priming bare metal with

an epoxy mastic, applying a full coat of a waterborne acrylic,

and topcoating with a high-solids polyurethane. A stadium was

recoated using this system. In response to the commenter's

concern about encapsulation paints used on floors, if these

products are recommended by the manufacturer solely for

application to floors and the product meets the definition of a

floor coating, the product would be subject to the VOC content

limit of 400 g/l for floor coatings. 

Alkali-resistant primers.

Comment: Three commenters (IV-D-189, IV-F-1g, IV-F-1k)

requested that the EPA recognize an alkali-resistant primers

category at 550 g/l VOC. One commenter (IV-D-189) requested the

category be defined as follows: primers formulated to resist

reaction with alkaline materials such as lime, cement, soap, etc. 

One commenter (IV-F-1k) did not agree with the statement in the

proposal preamble that latex coatings can perform the function of

alkali-resistant primers under the most difficult conditions.

Response: The EPA reviewed its basis for not creating this

category and, since no new information was presented to justify

establishing a category for alkali-resistant primers, the basis

for the EPA’s decision not to create this category is the same as

stated in the proposal preamble (61 FR 32739, June 25, 1996,

third column). That is, significant overlap between

alkali-resistant primers and the more general primer category is

apparent, and comments were received before proposal regarding
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the ability of lower-VOC latex coatings to perform the function

of alkali-resistant primers (61 FR 32739). In addition, only one

State architectural coating rule contains a category for alkaliresistant primers, with a VOC content limit of 560 g/l. In the

final rule, these coatings are subject to the primers and

undercoaters category VOC content limit of 350 g/l. 

Oil-modified urethane.

Comment: One commenter (IV-D-21) requested a separate

coating category for oil-modified urethane with a VOC content

limit of 520 g/l that would not be superseded by other categories

having lower limits, such as the floor coatings category

(400 g/l). The commenter stated that its product line has VOC

contents ranging from 477 to 519 g/l. Oil-modified urethane

coatings are used for finishing and refinishing residential

hardwood floors, gymnasium floors, and other sports floors. The

commenter stated that despite 6 years of effort, the company has

been unable to reformulate its oil-modified urethane products to

the proposed 400 g/l content limit for floor coatings. The

commenter cited problems with failure to cure properly and to

perform satisfactorily at a level below 477 g/l. Waterborne

urethane/acrylic coatings are being used (mostly in California);

however, the commenter stated that these coatings do not result

in the same appearance, durability and life to floors as the oilmodified urethane and that more coats of waterborne coatings are

needed for floors. As proposed, the commenter stated that the

rule would cause its company to lose most of its business for

that market, which represents over 11 percent of annual sales

($698,000). The commenter requested an exceedance fee as an

alternative compliance option if the EPA does not create a

separate coating category.

Another commenter (IV-D-211) also recommended adding a new

specialty category, "Clear coatings for sports floors" using

oil-modified urethane and water dispersed formulations. The

commenter requested a higher VOC content limit of 550 g/l. In

follow-up information (IV-E-6), the commenter stated that its

oil-modified urethane products have a VOC content between 500 and
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550 g/l, and these products are not sold in regulated areas.

According to the commenter, this new category fits the concept of

high performance coatings that the EPA considered but did not

propose as a general category. These are clear or semitransparent coatings formulated to provide a durable, solid

protective film for wood floors used for sports and are not

intended for residential use. According to follow-up information

(IV-E-6), as the solvent content of oil-modified urethane is

reduced, there are problems such as reduced flowability, more

chance of ridges of excess product, and increased drying time. 

The commenter cited the demanding performance requirements of

these coatings, which are developed specifically to work with

maple and its characteristics of porosity, hardness, and

dimensional changes with moisture and temperature. The commenter

referred to the results of a survey conducted by the Maple

Flooring Manufacturing Association in 1993 regarding problems

with water reducible urethane used on hardwood floors, including

gym floors. The problems included panelization or splitting,

excessive scuffing, and slipperiness. In follow-up information

(IV-E-6), the commenter noted that its company does sell a water

dispersed formulation compliant product in regulated areas, but

there are application and performance problems associated with

this product. The commenter also indicated that this company is

the largest direct marketer of sports floor coatings (IV-E-6). 

The commenter maintained that the creation of a separate category

would obviate the need for extensive reformulation in this small

category at this time.

Response: After review and evaluation of these comments and

follow-up information, the EPA has determined that the 450 g/l

VOC content limit is appropriate and that a separate coating

category for oil-modified urethane is not warranted. Due to the

change being made in the floor coating definition in the final

rule, the commenters would be subject to the varnishes coating

category with a VOC content limit of 450 g/l, rather than the

400 g/l limit proposed for floor coatings. Two commenters after

proposal of the rule (IV-D-69, IV-D-207) indicated that a VOC
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content limit of 450 g/l is achievable for varnishes used on wood

floors, and manufacturers at the public meeting held on

August 13, 1996 (IV-F-02) requested a VOC content limit of

450 g/l for the varnish category. Before proposal, one

manufacturer (II-E-47) commented that the 450 g/l limit seems to

be the lowest practical limit for polyurethane varnishes. Prior

to proposal, another commenter (II-D-195) stated that the most

commonly used varnish for wood floors is polyurethane and that

this product cannot be manufactured at a VOC content of less than

450 g/l and meet performance needs. Also, one commenter

(IV-D-85), a manufacturer of gym floor finishes, suggested the

EPA keep the 450 g/l limit for all varnishes (floors, walls,

cabinets etc.). In addition to these comments, the EPA

considered that all of the State rules reviewed have a VOC

content limit of 450 g/l or less for varnishes, except Texas

(540 g/l) and one county in California (650 g/l). 

Although the EPA has not raised the VOC content limit as

requested by the commenter, the EPA has provided alternative

mechanisms supported by the commenter. An exceedance fee

provision and a tonnage exemption are included in the final rule

for compliance flexibility. These provisions could allow the

commenters to maintain sales from this product line until the

product can be reformulated to meet the 450 g/l VOC content

limit. 

Porcelain repair coatings.

Comment: One commenter (IV-D-26) recommended adding a

category to define porcelain repair coatings. These coatings are

used to repair and maintain bathroom and kitchen fixtures such as

sinks, bathtubs, and shower enclosures. The company stated that

the VOC content of the coatings is 600 g/l and, therefore, it

cannot meet the proposed VOC content limit of 450 g/l for

industrial maintenance coatings. Follow-up information provided

by the commenter (IV-E-9) noted that reformulation attempts have

not been successful because the required technology is not yet

available from resin manufacturers. The commenter obtained a
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small-container (1 liter) exemption (available to all companies

in commenter’s area) for these products and, thus, they are

currently sold in a local regulated area in California. The

commenter estimates growth for this category to be about

2-3 percent per year depending on the aging of hotels/motels and

housing, and the ratio of rebuilding versus refurbishment.

Response: After review and evaluation of the information,

the EPA has determined that a separate category for "porcelain

repair coatings" is not warranted. According to one State agency

(IV-E-28), there are several manufacturers of compliant porcelain

repair coatings that meet a 420 g/l VOC content limit. 

Therefore, the EPA concludes that the need for this type of

coating can be met through the industrial maintenance coating

category with a VOC content limit of 450 g/l. Although the

industry-wide annual sales volume is not available, it is

expected that these would likely be considered low-volume

coatings relative to other coatings covered by the rule. Thus,

the tonnage exemption in the final rule could offer compliance

flexibility. Even though the majority of end uses for these

coatings are in industrial and commercial situations, there are

some residential uses of these coatings, such as ceramic fixture

repair. Similar to existing local regulations, the final

architectural coating rule includes a small-container (1 liter or

less) exemption that also provides flexibility to continue to

market these coatings and to satisfy existing and future customer

needs. 

Zinc-rich coatings.

Comment: One commenter (IV-D-18) suggested that the EPA

create a zinc-rich coatings category with a VOC content limit of

350 g/l instead of including these coatings in the metallic

pigmented coating category with a VOC content limit of 500 g/l. 

The commenter suggested defining a new category of metallic

pigmented coatings as zinc-rich coatings, which are those

materials where at least 50 percent by weight of the dry film is

zinc metal. These coatings are routinely applied in both shop

applications and in the field to protect against corrosion. 
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According to the commenter, steel members for highway bridges are

always at least coated with a corrosion-resistant primer in the

shop and are frequently or normally completely coated with

primer, intermediate coat, and topcoat in a fabrication shop

before shipping to the field to be erected. These shop

applications are regulated under requirements (e.g., CTG) for

miscellaneous metal parts. The commenter referenced and attached

an article entitled "Environmental Exposure Testing of Low VOC

Coatings for Steel Bridges" by John Peart of the Federal Highway

Administration and Robert Kogler, Jr. of Ocean City Research

Corporation which was published in the Journal Of Protective

Coatings & Linings in January 1994. According to the commenter,

the study, which included 3 to 4 years of exterior marine

exposure of a variety of coatings, concluded that the performance

of several low-VOC test systems (using a zinc-rich primer) meet

or exceed that of the best performing traditionally high-VOC

systems. Furthermore, the author states that several companies

have marketed products meeting 350 g/l for five to ten years and

offered a list of waterborne and solventborne zinc-rich coatings

that are commercially available.

Response: The EPA appreciates the identification of these

lower-VOC content zinc-rich coatings with a VOC content at or

below 350 g/l that showed performance that meets or exceeds that

of conventional higher-VOC content coatings during steel bridges

exposure testing. However, due to the potential broadness of the

category to applications outside of those highlighted by the

commenter, the EPA did not create a new category for zinc-rich

coatings. Specifically, other comments (II-D-75, II-D-156)

received before proposal indicated that there are major

differences between types and uses of zinc coatings and that it

may not be feasible or correct to apply VOC content levels

designed for one technology to completely different technology. 

For example, one commenter (II-D-156) manufactures an ultra-high

performance coating that contains 95 percent zinc in the dried

film with a VOC content of 385 g/l. It is a one-component

product based on an organic binding system, which the commenter
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argued makes it highly effective in field locations where the

following specifications exist: (1) high performance cannot be

compromised, (2) near perfect surface preparation cannot be

attained and (3) mixing of two or more components is impractical. 

The commenter stated that a typical application of this product

might be a structural steel frame for a large, multi-story

building. The commenter also referred to the 1994 study cited by

commenter IV-D-18 and noted that it concluded that low-VOC

waterbased zinc coatings do not work in a field environment.

Other comments (II-D-75, II-D-79, II-D-111) received before

proposal specifically requested that zinc-rich coatings be

classified in the category of metallic pigmented coatings: 

(1) due to the difference in allowable limits between metallic

pigmented coatings and industrial maintenance coatings

(420-450 g/l)(this limit would ban the production of metallic

zinc coatings) (IV-D-75, IV-D-79, IV-D-111), and (2) because

reformulation efforts have been unsuccessful (II-D-75). In

addition, California Air Quality Management Districts (Sacramento

and South Coast), New York City Metropolitan area, New Jersey,

Kentucky, Massachusetts, Rhode Island, and Oregon architectural

coating regulations have a category for metallic pigmented

coatings at 500 g/l that are defined the same as or similar to

the proposed category definition in the architectural coating

rule. Metallic pigmented coatings are exempt in the counties of

Butte and El Dorado in California and in Maricopa County in

Arizona. There are no State regulations specifically for zincrich coatings.

Faux finishing/Glazing.

Comment: One commenter (IV-D-20) suggested that the EPA

create a "Faux finishing/glazing" category with a VOC content

limit assigned based on formulation “including water” because the

company could not meet the proposed VOC content limit of 380 g/l

for nonflat interior coatings. Based on formulation including

water, the calculated VOC content of the colors can range up to

340 g/l. However, because the products are waterborne, the VOC

"less water" calculation results in a range up to 700 g/l. The
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VOC content limit for a similar category (Japan/faux finishing

coatings) has been proposed by California's South Coast Air

Quality Management District at 700 g/l. This category would

address waterborne acrylic finishes and other waterborne products

with miscible VOC that are designed to retard drying time. The

commenter stated that these products provide open time required

for wet-in-wet decoration techniques, such as faux wood grain,

faux marble and simulated aging, which require the finish to

remain wet for an extended period of time. The commenter stated

that, to date, there has not been an identifiable way to

reformulate these products to achieve a lower VOC content while

maintaining the characteristics required for acceptable use. The

commenter suggested that this specialty category be defined as

follows: "Faux finishing/glazing is used for wet-in-wet

techniques, such as faux wood grain, faux marble, and simulated

aging, which require the finish to remain wet for an extended

period of time." The commenter stated that the "do-it-yourself"

market is more confined than the professional market to sales in

pint and quart sizes, and this market comprises the majority of

sales (Docket Item IV-E-7). Larger quantities, a gallon or

above, are generally used by professionals who are coating large

spaces. 

Response: Upon review and evaluation of available

information, the EPA has determined that creating a separate

category for faux finishing/glazing with a VOC content level of

700 g/l is warranted. The faux finishing/glazing category is

defined in the final rule as suggested by the commenter. This is

a specialized, limited use category. According to the commenter,

there are no competing compliant products on the market, and

despite 2 years of reformulation efforts, this coating cannot

meet the proposed VOC content limit of 380 g/l for nonflat

interior coatings. Waterborne technology is an emerging market

for these products.

The California-South Coast AQMD has recently amended its

rule for this category from 350 g/l to 700 g/l because the lower

VOC content limit could not be achieved. The South Coast AQMD
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VOC content limit will be reduced again to 350 g/l on

January 1, 1999 if this level is achievable.

The commenter stated that the majority of these products are

sold in containers that are less than 1 liter in size. 

Therefore, the majority of the faux finishing/glazing sales will

not be subject to the architectural coatings rules since it does

not apply to coatings sold in containers of 1 liter or less.

Stain controllers.

Comment: One commenter (IV-D-185) requested that the EPA

clarify the coating category of “sealers” by excluding “stain

controllers” from that category. In follow-up information

(IV-E-Cohagan), the commenter asserted that these products cannot

achieve the proposed 400 g/l content limit for sealers based on

three years of unsuccessful reformulation efforts. According to

the commenter, it is technologically infeasible to reformulate

stain controllers to achieve the proposed 400 g/l VOC content

limit. The current VOC content of these products is 714 g/l. 

The 400 g/l limit for sealers would force a very high solids

content, which would make these products unfit for use as

prestains. “Stain controllers” (also called “wood conditioners”

or “prestains”) are coatings that are applied to soft woods

before applying a stain to prevent uneven penetration or

blotching of the stain by filling those pores where excess

penetration would occur. The commenter asserted that in order to

be effective, stain controllers must have a very low solids

content because excessive solids will overload the texture of the

substrate so that the wood will not properly accept the stain. 

Water cannot be added to these products because they are used

almost exclusively to treat interior fine wood and contact with

water would produce an undesirable grain-raising effect in the

wood. According to the commenter, stain controllers are lowvolume, specialized products that are important to the consumer

and have a minimal effect on air quality. The commenter defined

a “stain controller” as “a conditioner or pretreatment product

formulated and recommended for application to wood prior to the

application of a stain in order to prevent uneven penetration of
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the stain.” In follow-up information (IV-E-Cohagan), the

commenter revealed that about 97 percent of total sales for these

coatings are exempt under the small container exemption in

regulated areas.

Response: After review and evaluation of these comments and

the follow-up information, the EPA has determined that a new

category for stain controllers with a VOC content limit of

720 g/l is warranted. As suggested by the commenter, the

category of stain controllers is defined as “conditioners or

pretreatment products formulated and recommended for application

to wood prior to the application of a stain in order to prevent

uneven penetration of the stain." According to the commenter,

reformulation attempts during the last 3 years have been

unsuccessful, and the commenter considers it technologically

infeasible to reformulate stain controllers at the proposed VOC

content limit of 400 g/l for sealers (the category the commenter

would be subject to under the proposed rule). According to the

commenter, there are competing compliant waterbased coatings on

the market, but there are performance problems with these

coatings. The EPA believes that this is an example of a lowvolume, specialty niche coating for which it may not be costeffective for the manufacturer to continue reformulation

attempts. Therefore, the EPA has created a separate category for

stain controllers.

Concrete/masonry conditioners.

 Comment: Three commenters (IV-D-06, IV-D-172, IV-D-189)

requested that the EPA create a concrete/masonry conditioners

category with a VOC content limit of 780 g/l. One commenter

(IV-D-189) provided the following definition: "A low-solids

lacquer which is formulated and marketed specifically for use as

a conditioner or sealer of concrete and masonry surfaces." The

commenter pointed out that this category and definition is in the

Massachusetts architectural coating rule with a VOC content limit

of 780 g/l. The commenter explained that concrete masonry

conditioners are required to tie up and bond to a concrete

surface any loose material before topcoating. This conditioner
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is needed in order to apply a latex finish directly to a concrete

surface that cannot be power washed. Two commenters (IV-D-06,

IV-D-172) stated that any attempt to apply latex finishes

directly over these loose particles will result in catastrophic

disbondment failure. The commenters argued that the use of the

conditioner allows for a greater use of lower-VOC latex coating

as topcoats on masonry surfaces. One commenter (IV-D-172)

advised that these products are presently in nationwide use. 

This commenter claimed that the proposed rule bans these products

which cannot be formulated under 250 g/l VOC. Two of the

commenters (IV-D-06, IV-D-172) stated that the use of the

masonry/concrete conditioners extends the life of the latex top

coat resulting in reduced VOC emissions and reduced costs when

compared to use of latex paint without the conditioner.

Two commenters (IV-D-06, IV-D-172) also claimed that

repeated research projects have shown that waterborne, low-VOC

trial masonry conditioners cannot achieve the success of the lowsolids solvent acrylic coatings.

Response: Based upon an evaluation of these comments and

follow-up information (IV-E-38), the EPA has determined that a

new coating category for concrete/masonry conditioners at 780 g/l

is not warranted. This product will be subject to the sealers

category with a VOC content limit of 400 g/l. The EPA believes

that establishing this category would create overlap with the

sealers category. The new category would allow higher VOC

content coatings where sealer products at or below 400 g/l VOC

content can perform the coating function because the EPA’s

definition of the sealer category includes coatings used to

“condition chalky surfaces.” According to a follow-up discussion

(IV-E-38) with the National Concrete Masonry Association (NCMA),

the term “conditioner” is not typically used when referring to

coatings used on concrete masonry walls or concrete blocks. The

NCMA stated that acrylic, latex or cement-based paints are used

on concrete masonry as water repellents and no conditioner is

needed or used before these coatings are applied. The NCMA

provided a copy of its specifications for these applications,
2-155

which included the types of water repellents and general

guidelines for application of surface treatments. The

commenters’ (IV-D-06, IV-D-172) comparison, that the lifetime

cost and VOC emissions of latex paint without the conditioner are

much greater than if a conditioner is used, would be true for

most coatings that use a primer. The final rule contains

compliance flexibility such as the tonnage exemption for low

volumes of production and/or the exceedance fee. These

provisions could be used by the commenters for the continued

manufacture of this coating.

Calcimine recoater.

Comment: Three commenters (IV-D-06, IV-D-172, IV-D-189)

recommended that the EPA add a "calcimine recoater" category to

the final rule. These coatings are formulated to repaint

ceilings painted with calcimine. Two commenters (IV-D-06,

IV-D-189) suggested a VOC content limit of 475 g/l, and the other

commenter (IV-D-172) made no recommendation on the VOC content

level. The commenters explained that water soluble calcimine

paints were used in Victorian and Early American houses,

especially on ceilings. Calcimine recoater products are made

with limed vegetable oils and are light, puffy and gel-like. Due

to their low density, they do not disbond calcimine ceiling

coatings. One commenter (IV-D-189) indicated that the coating is

a specialized, low-volume usage coating for which a category is

currently included in the Massachusetts architectural coating

rule. The other commenter (IV-D-172) gave typical VOC content

levels of 450-465 g/l for the company’s products and stated that

calcimine recoaters are the only economical way to handle the

repainting of calcimine coated surfaces. The commenter explained

that conventional (250 g/l VOC) high-solids flat alkyd paints do

not level well or dry properly and eventually cause calcimine

ceiling paint to peel in sheets. The commenter presented two

ways to handle the repainting of calcimine: to soften and scrape

off all the calcimine and repaint the ceiling, or to use a

coating formulated for calcimine recoating. The first method,

the commenter explained, is labor intensive and costly. Thus,
2-156

the commenter concluded that the lack of a calcimine recoater

category will create a significant hardship for owners of early

American and Victorian houses. The commenter asserted that the

proposed rule would essentially ban this coating which cannot be

reformulated under 250 g/l (the VOC content limit for interior

flat coatings). 

Response: Upon review and evaluation of this information,

the EPA has determined that a separate category should be

established for calcimine recoaters with a VOC content limit of

475 g/l, the same limit as the Massachusetts rule requires for

this category. The EPA amended the final rule to include this

category with the following definition: "Calcimine recoater

means a flat solventborne coating formulated and marketed

specifically for recoating calcimine-painted ceilings and other

calcimine-painted substrates." This definition is nearly the

same as used in the Massachusetts rule. This is a low volume,

specialized coating used in limited, specific circumstances. 

These products reportedly cannot be reformulated to meet the

250 g/l content limit for interior flat coatings. The

composition of calcimine recoaters is unique and there is no

substitute for the function of these coatings.

Adhesion promoters.

Comment: Two commenters (IV-D-08, IV-D-189) requested that

the EPA create a category for "adhesion promoters" with a VOC

content limit of 680 g/l. One commenter (IV-D-189) offered a

definition of adhesion promoter as: 

"a high performance coating specifically formulated and

recommended for the thin film application to difficult to

paint, hard, glossy surfaces (including, but not limited to

plastics, fiberglass, polished metal such as door locks and

ceramics) to provide improved adhesion of subsequent coats."

The commenters asserted that these are specially formulated

coatings used to improve the adhesion of coatings to surfaces

that are hard and glossy such as polished metal, ceramics,

plastics, and fiberglass. They are applied in very thin films

just prior to the topcoating of the surface. The commenters

stated that these unique coatings are clear or contain very low
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levels of pigmentation and in order to obtain the thin film

thickness, the solids content of these coatings must be kept low. 

Therefore, the VOC content of the products is relatively high. 

One commenter (IV-D-08) noted that new alternative water-based

formulas have performance limitations due to water sensitivity on

hard, glossy surfaces. Both of the commenters noted that several

State automotive refinishing rules as well as the proposed

national rule for automobile refinish coatings set a precedent

for a special category of adhesion promoters. One commenter

(IV-D-189) maintained that although formulations are somewhat

different, the need and rationale for applying a thin film of

adhesion promoting material to a difficult-to-paint surface is

the same.

One commenter (IV-D-08) maintained that the imposition of

lower VOC content limits would result in an adverse economic

impact on the small business manufacturers, users, and

applicators of these coatings. Based on their actual experience

dealing with the State rules, they quoted a reformulation cost of

over $80,000. In addition, the commenter estimated that the

additional amount of VOC that would result from the creation of

this category would be less than 200 tons per year in the

architectural coating market. Follow-up information (IV-E-23)

from this commenter revealed that its company manufactures other

primers and these primers can be reformulated to meet the VOC

content limit of 350 g/l. Competitors make thicker primers that

meet the VOC content limit of 350 g/l. However, the commenter

stated that adhesion promoters require 680 g/l for thin-film

applications on substrates such as glazed porcelain tile and

formica cabinets and paneling refinishing (surfaces that were not

intended to be painted). The commenter estimates growth for

these coatings to be 10 percent over the next 5 years. 

Currently, the commenter sells this coating in small containers

in regulated areas. If a category is not established for

adhesion promoters, this commenter (IV-D-08) requested a smallvolume exemption of 5,000 to 10,000 gallons. 
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Response: Based upon consideration of these comments and

follow-up information obtained from the commenter (IV-E-23), the

EPA has not established a separate category for adhesion

promoters in the final rule. Without this separate category,

these coatings are subject to the primers and undercoaters VOC

content limit of 350 g/l. Similar to alkali-resistant primers,

there is significant overlap between adhesion promoters and the

general primers and undercoaters category due to the broadness of

the definition for adhesion promoters. The EPA believes that

creating this category would allow the use of higher-VOC content

coatings for which lower-VOC content coatings would be

acceptable. The commenter could continue the sale of adhesion

promoters in small containers (1 liter or less), which are not

regulated under this rule, while continuing reformulation

efforts. The tonnage exemption and exceedance fee provisions of

the rule could also provide additional compliance flexibility. 

Marine/architectural coatings.

Comment: One commenter (IV-D-173) suggested that the EPA

establish a category for marine/architectural coatings for hulls

and decks of yachts, fishing boats, and working ships. The

commenter stated that these coatings are also used on steel,

wood, and concrete block structures painted between October and

May when the weather is freezing and rainy. The commenter

explained that waterborne coatings have not been developed as a

viable substitute, and high-solids coatings would be difficult to

spread and would not dry quickly enough due to dew, frost, and

rain. 

Similarly, the commenter supported the use of solventborne

marine/industrial deep color alkyd enamels that provide rust

prevention on old metal surfaces on seawalls in Michigan. The

commenter explained that seawalls are best painted in the winter

because during the summer, boats in the wells splash water on the

surfaces causing the paint to run into the water. The commenter

also stated that compliant waterborne and high solids coatings

would not last as long and that painting more frequently would

put more solvent in the air. The commenter concluded that the
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EPA was moving hastily and that the use of existing paints should

be allowed until quality compliant paints can be formulated and

tested. No definition or VOC content limit was suggested for

marine coatings. 

Response: The architectural coating rule only applies to

coatings used on stationary structures and, therefore, the rule

would not cover the coating or recoating of yachts and boats. 

Based on consideration of the limited information submitted by

the commenter, including follow-up information (IV-E-12), the EPA

has determined that a separate specialty category for

marine/architectural coatings used on stationary structures, such

as seawalls, is not warranted. The commenter’s description of

the coatings indicates that they would fall under the industrial

maintenance category with a VOC content limit of 450 g/l. In

follow-up information (IV-E-12), the commenter did not recommend

a specific VOC content limit or specify a definition for these

coatings and did not know the VOC content of its existing marine

coatings. The commenter estimated that the company's total

annual production of all products is 15,000-20,000 gallons. The

commenter could consider the tonnage exemption and/or exceedance

fee in the final rule, while continuing reformulation efforts.

Concrete curing and sealing compounds.

Comment: Seven commenters (IV-D-86, IV-D-187/IV-F-1e,

IV-D-152, IV-D-154, IV-D-170, IV-D-210, IV-F-2e, IV-G-17)

requested that the EPA create a new category for "concrete curing

and sealing compounds" with a VOC content limit of 700 g/l. Two

of the commenters (IV-D-86, IV-D-152) suggested the following

definition for concrete curing and sealing compounds: "A liquid

membrane-forming compound marketed and sold solely for

application to concrete surfaces to reduce the loss of water

during the hardening process and which seals old and new concrete

providing resistance against alkalis, acids, and UV light, and

providing adhesion promoting qualities." Another commenter

(IV-D-154) recommended that the EPA include in the definition the

requirement that the coating meet the recently-developed American

Society for Testing and Materials (ASTM) C1315-95 standard to
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provide a clear distinction between high performance, permanent

sealers and those materials designed principally as curing

compounds with some sealing characteristics. Without a separate

category, the commenters would be subject to the proposed

concrete curing compounds category VOC content limit of 350 g/l. 

A follow-up discussion with one of the commenters (IV-E-13)

clarified that concrete curing and sealing compounds are

typically used on buildings, while concrete curing compounds are

used on highways. The commenter added that the 1990 VOC

Emissions Inventory Survey under-represented these coatings and

concrete form release compounds because they are not made by

paint manufacturers; they are made by the construction industry.

Specifically, two commenters (IV-D-170, IV-D-210) noted that the

survey of coating manufacturers and the EPA failed to recognize

the concrete curing and sealing compounds industry and stated

that over 10 million gallons of concrete curing and sealing

compounds are produced annually, much higher than the

331,000 gallons of concrete curing compounds accounted for in the

survey. One of the commenters (IV-D-152) distinguished curing

compounds as having the single function of providing moisture

retention for curing to produce design strength and other desired

properties. In comparison, curing and sealing compounds function

as longer term sealers that provide protection, aesthetics, and

durability in addition to curing. The EPA contacted all of the

commenters for clarifications and follow-up. In follow-up

discussions (IV-E-13, IV-E-15, IV-E-16, IV-E-17, IV-E-18,

IV-E-37, IV-E-49, IV-E-50), the commenters asserted that the

proposed VOC content limit of 350 g/l is not technologically

feasible for the concrete curing and sealing compounds category

and, if applied to this category, will force the use of

waterbased technology with inadequate performance. Based on

sales and VOC content information submitted by the commenters,

about 25 percent of the current production of concrete curing and

sealing compounds have VOC content levels ranging from

751-850 g/l, while slightly more than half of the total

production is in the 701-750 g/l range. According to one of the
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commenters (IV-D-152), the requirements of aesthetics and

longevity coupled with the need for applications over wide

temperature and humidity ranges can only be met with solventbased systems. 

 One commenter (IV-D-170) pointed out that ASTM recognizes a

separate category for concrete curing and sealing and that

current specifications from the Department of Transportation and

the Corps of Engineers cannot be satisfied with current

waterborne technology. On the other hand, one of the commenters

(IV-D-154) indicated that States with VOC standards in place,

such as California and New Jersey, have not seen the need for

making a distinction between "concrete curing" and "concrete

curing and sealing" because waterborne products are available to

meet both requirements. However, the commenter elaborated that

drawbacks of waterborne formulations are low-temperature

performance and low-temperature stability. This commenter

asserted that a VOC content limit of 675 to 700 g/l will permit

effective concrete curing and sealing compounds to be marketed. 

Another commenter (IV-D-170) argued that California and New

Jersey are not influenced by the weather conditions of other

states such as Minnesota, North Dakota, South Dakota, Wisconsin,

and Nebraska. Moreover, in a follow-up discussion with one

commenter (IV-E-37), it was again pointed out that one of the

main problems with waterborne coatings is that they will not

coalesce at temperatures below 50 F. The commenter stated that o

solventborne products can be used at temperatures as low as

30 F. Another commenter (IV-D-170) cited several other o

drawbacks to the use of waterborne technology such as shrinkage

cracks due to late saw cutting and curling of slabs caused by

different water content between the top and bottom of the slab. 

In addition, the winter and freeze/thaw cycles have deleterious

effects on uncured/sealed concrete. One commenter (IV-D-210), a

small family-owned business that produces coatings for the

concrete industry, referred to the ongoing development of

waterborne cure/sealer coatings since 1989, but to date the
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business has been unable to develop a waterborne cure/sealer that

will perform as effectively as the solventbased coatings. 

One commenter (IV-D-152) stated that specifying a VOC

content limit of 700 g/l for the concrete curing and sealing

category would allow formulations with solids in the 25 to

30 percent range. The commenter pointed out that a formulation

with solids over 30 percent is impractical due to technical

limitations, and most curing and sealing compounds sold today

fall into the 10 to 15 percent solids range with a VOC content

greater than 800 g/l. Two of the commenters (IV-D-86, IV-D-170)

argued that the EPA would see a 33 to 39 percent VOC emission

reduction as a result of the combination of increased coverage

(through use of higher solids) and the recommended VOC content

limit of 700 g/l if all the curing and sealing market converts to

higher solids formulations (i.e., 25 to 30 percent solids). 

Follow-up discussions with several manufacturers (IV-E-37,

IV-E-17, IV-E-15, IV-E-18) confirmed that the limiting factor on

lower-VOC solventborne products is the solids content. The

manufacturers stated that the highest possible solids content is

30 percent (VOC content of 650 g/l); and the use of higher solids

presents application problems, they do not bond well, and they

wear more quickly. 

A small business that manufactures (IV-F-2e) concrete

sealers and concrete curing compounds stated that there is no

such thing as a true waterbased concrete coating because there

are always coalescing problems. The commenter stated that

waterbased concrete curing and sealing coatings do not work and

recommended that the EPA make a distinction in the rule between a

concrete curing and sealing coating versus a concrete curing

compound.

 Response: Based on review and evaluation of information

submitted by the commenters and follow-up information provided by

six manufacturers of concrete curing and sealing compounds

(IV-E-13, IV-E-15, IV-E-17, IV-E-18, IV-E-37, IV-E-50), the EPA

has determined that a separate category for concrete curing and

sealing compounds should be established with a VOC content limit
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of 700 g/l, as recommended by the commenters. The definition is

as follows:

Concrete curing and sealing compound means a liquid

membrane-forming compound marketed and sold solely for

application to concrete surfaces to reduce the loss of water

during the hardening process and to seal old and new

concrete providing resistance against alkalis, acids, and

ultraviolet light, and provide adhesion promotion qualities. 

The coating must meet the requirements of ASTM C1315-95,

Standard Specification for Liquid Membrane Forming Compounds

Having Special Properties for Curing and Sealing Concrete. 

There are several reasons for establishing this category. 

Manufacturers of coatings for the concrete industry were not

fully represented in the VOC Emissions Inventory Survey and,

therefore, insufficient data were collected to evaluate concrete

curing products in the proposed rule. Based on comments received

on the proposal, the EPA has determined that the categories of

"concrete curing" and "concrete curing and sealing" have

different performance characteristics; i.e, concrete curing and

sealing compounds function as longer term sealers that provide

protection, aesthetics, and durability in addition to curing. 

There are two separate ASTM methods available for each of these

categories because ASTM Committee experts as well as the

Department of Transportation and Army Corps of Engineers consider

them separate, distinct categories with different performance

requirements. The VOC content limit of 350 g/l for concrete

curing reportedly cannot be achieved by the concrete curing and

sealing industry for all applications. Although waterborne

products are available that meet the VOC content limit of

350 g/l, commenters cited several drawbacks such as lowtemperature performance and low-temperature stability.

Although the commenters stated that most curing and sealing

compounds fall into the 10 to 15 percent solids range with a VOC

content greater than 800 g/l, the information the commenters

provided to the EPA (table 2-2) shows that the products with VOC

contents ranging between 701 and 750 g/l had the largest sales

volume (about 53 percent). Also, based on this information, the

EPA has determined that a VOC content limit of 700 g/l for the
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concrete curing and sealing category is technologically feasible,

allowing formulations with 25 to 30 percent solids, which is

reportedly an acceptable range to meet performance requirements. 

Based on analysis of information provided and as requested by

nearly all of the commenters, the EPA believes a VOC content

limit of 700 g/l is appropriate for this category. This limit

will reduce VOC emissions from this category by an estimated

28 percent.

Concrete surface retarders.

Comment: Two commenters from the same company (IV-D-68,

IV-D-120) and another commenter (IV-D-209) maintained that

concrete surface retarders should not be covered by the

architectural coating rule on the grounds that these products do

not meet the proposed definition of a coating. Two commenters

(IV-D-68, IV-D-120) stated that concrete surface retarders are

used in the production of exposed aggregate finishes for

architectural precast concrete panels for buildings that last

more than 30 years. These commenters explained that surface

retarders effectively disrupt the chemistry of freshly poured

concrete by altering cement hydration. This causes the surface

to not harden to a specified depth known as "depth of etch." 
klk\S:\ADO_JES\AIM-BID.PMG 2-165 Table 2-2. CONCRETE CURING AND SEALING DATA VOC Range Volume Sales Average Average VOC Emissio

(g/l) N (gal) (%) VOC (g/l) (lb/gal) (lbs) 

Sales/ Sales Sales Production Weighted Weighted Actual V

0-199 5 21,596 0.73 136 1.13 24,423 

200-299 8 114,244 3.86 239 1.99 227,66300-399 7 82,075 2.77 349 2.91 238,93400-599 0 0 0 0 0 0 600-649 5 228,447 7.72 642 5.35 1,222,3650-699 13 252,240 8.53 669 5.57 1,405,6700-749 23 1,568,961 53.03 722 6.01 9,433,5750-849 16 690,934 23.35 771 6.43 4,440,5

Totals 77 2,958,497 100.00 689 5.74 16,993,2

N = the number of productsReferences: IV-D-170, IV-D-87, IV-D-195 to IV-D-203, IV-D-210, IV-G-06 to I
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Concrete surface retarders are formulated to control etch thereby

giving various options to precasters for different job

applications. Both commenters (IV-D-68, IV-D-120) explained that

after application, concrete surface retarders are given

14-72 hours to affect the concrete system, after which time the

non-hardened cement surface (and the concrete surface retarder)

is either brushed, blown, or washed away to give an

architecturally pleasing surface of exposed aggregate. Both

commenters explained that the concrete surface retarder does not

form a coating, but interacts chemically with the cement to

prevent hardening where the concrete surface retarder is applied, 

allowing the retarded matrix of cement and sand at the surface to

be washed away to create an exposed aggregate finish typically

requiring no further treatment. All of the commenters pointed

out that New Jersey and Texas do not regulate concrete surface

retarders because they do not meet their definition of a coating

and are, therefore, exempt from their architectural coating

rules. 

Two commenters (IV-D-120, IV-D-209) challenged the legal,

technical, and environmental basis for regulating concrete

surface retarders since emissions from this category were not

addressed in the EPA survey. If an exemption is not granted on

the basis that these products do not meet the definition of a

coating, the commenters requested an exemption be granted on the

basis of a categorical or low-volume specialty niche. The

commenters base their request on data from the National Paint and

Coatings Association (NPCA) and the Precast/Prestressed Concrete

Institute (IV-D-209) that illustrates that concrete surface

retarders constitute less than 0.03 percent of the architectural

coatings market. 

If the EPA decides that concrete surface retarders are

considered to be coatings, the commenters requested that a new

category be created similar to the masonry/concrete conditioner

category and VOC content limit of 780 g/l used in the

Massachusetts rule and suggested the following definition:

“Concrete surface retarder means a low-solids coating which is
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formulated and marketed specifically for use as a conditioner of

concrete surfaces to achieve an exposed aggregate finish”. Two

commenters (IV-D-120, IV-D-209) discussed the progress in resin

technology with regard to VOC reductions from concrete surface

retarders and concluded that the VOC content of retarders cannot

readily be reduced through resin technology. According to these

commenters, current technology has yet to provide a low-VOC

content concrete surface retarder that effectively performs to

necessary field requirements in all applications. They stated

that water-based concrete surface retarders have been developed,

but do not perform nearly as well as solvent-based concrete

surface retarders in terms of application, usage and performance. 

According to one commenter (IV-D-120), concrete surface retarders

are used in a unique and specific application and constitute

merely 0.01 percent (150,000 gallons) of the total coatings sold

by the coating industry and less than 0.03 percent of

architectural coatings sold. 

According to follow-up information from the largest

manufacturer of retarders (IV-E-24), the volume of their concrete

retarders used "on-site" (in the field) is not anticipated to

exceed 5,000 gallons (less than 2 percent of their total

production) per year. The commenter stated that concrete

retarders are generally used in a manufacturing setting at a

precast facility. The commenter stated that there are

approximately 400 precast plants in the U.S. that employ about

18,500 people. If these plants are required to meet the proposed

VOC content limit, the commenter asserted that precasters would

not have available an effective, alternative product and some

plants would be forced out of business. According to the

commenter, establishing a VOC content limit of 780 g/l would not

cause a significant contribution to air pollution nationally

because emissions from concrete surface retarders evidently were

not significant enough to include them as part of the coatings

emissions study when the proposed regulation was being developed.

Response: First, the EPA notes that when concrete surface

retarders are recommended solely for use in the production of
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exposed aggregate finishes for architectural precast concrete

panels in a manufacturing setting at a precast facility, which is

the typical situation, they are not subject to this rule. 

Second, the EPA has considered the argument that these products

are not coatings and has concluded that concrete surface

retarders contain resins and solvents and serve a functional

purpose (retarders are applied to the surface and then washed

away to achieve an exposed aggregate finish) and, thus, meet the

rule’s definition of a coating. The architectural coating rule

defines a coating as follows:

Coating means a material applied onto or impregnated into a

substrate for protective, decorative or functional purposes. 

Such materials include, but are not limited to, paints,

varnishes, sealants, inks, maskants, and temporary coatings. 

Protective, decorative, or functional materials that consist

only of solvents, acids, bases, or any combination of these

substances are not considered coatings for the purpose of

this subpart.

Consequently, these products are subject to the architectural

coating rule. Third, concrete surface retarders that are used in

the field at the actual job location are subject to the rule, and

the EPA has created a new category for concrete surface retarders

with a VOC content limit of 780 g/l. This limit is based on

information provided by the commenters that indicates it is

technologically and economically feasible. No information was

available to the EPA to support a lower limit. In the final

rule, concrete surface retarder is defined as 

“a mixture of retarding ingredients such as extender

pigments, primary pigments, resin, and solvent that interact

chemically with cement to prevent hardening on the surface

where the retarder is applied, allowing the retarded mix of

cement and sand at the surface to be washed away to create

an exposed aggregate finish.” 

Based on information received from one large manufacturer

(IV-E-24) of these products, the volume of retarders used in the

field or “on-site” is relatively low (less than 5,000 gallons per

year). These products reportedly cannot be reformulated to meet

the VOC content limit of 250 g/l for interior flat coatings,

which the products would be subject to in the absence of a
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specific category of concrete surface retarders. The composition

of concrete surface retarders is unique and there is no lower-VOC

content substitute for the function of these products in all

applications. Therefore, the EPA has created this low-volume,

specialty niche category with a VOC content limit of 780 g/l in

the final rule.

Low solids coatings.

Comment: Two commenters (IV-D-185, IV-D-189) urged the EPA

to provide a "low-solids" subcategory for all types of

architectural and industrial maintenance coatings and to include

in these subcategories those products that have less than one

pound of solids per gallon of coating. The commenters pointed

out that this would be similar to the low-solids subcategory in

the proposed rule under stains and wood preservatives. One

commenter (IV-D-185) recommended that the references to lowsolids stains and low-solids wood preservatives in §§ 59.402(c)

and 59.403(a)(3) of the proposed rule should then be changed to

"low-solids coatings." The commenter stated that the concept of

a low-solids coatings category is beneficial because it ensures a

minimal VOC content that benefits both consumers and the

environment. The commenter stated that low-solids coatings are

applied on a volume, not solids, basis. Therefore, the VOC

content should be calculated including water and exempt solvent

in order to avoid delaying or preventing the introduction of

innovative products that can significantly reduce VOC emissions. 

One commenter (IV-D-189) defined low-solids subcategories in part

as containing 1 pound or less of solids per gallon (0.12 kg

solids/l) of coating materials and for which at least half of the

volatile component is water.

Response: The EPA has no data or information upon which to

base a VOC content limit for low-solids coatings in architectural

coating categories other than stains and wood preservatives. For

stains and wood preservatives, it is clear that at a very low

level of solids content, the coating coverage is dependent on

volume rather than the amount of solids in the coating. For

other applications that have very low solids (e.g., lacquers for
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metal), the solids content still dictates the amount of coating

used (rather than volume) and for this type of coating more

gallons would be needed to achieve the same coverage as a highersolids coating. Consequently, the EPA has not added a general

low-solids coatings category to the final rule.

Tung oil finishes.

Comment: Forty percent of one commenter's (IV-F-2(l))

products are specialty tung oil finishes (an oil varnish or

sealer) for wood. Follow-up information provided by the

commenter (IV-E-14) indicates that some tung oil finishes are

clear and some are opaque. The commenter stated that the VOC

content ranges from 600 to 700 g/l for its tung oil finishes. 

This product is used on floors, furniture, and paneling. The

commenter has developed some waterborne products for other

applications but not for wood because waterborne products tend to

raise the wood grain. The commenter argued that the VOC content

of these products must be high for penetration. The commenter

stated that reformulation attempts have not been successful. 

Because these tung oil finishes cannot be reformulated and still

meet performance needs, the commenter requested that these

products either be exempted from the regulation or be placed in a

specialty category. The commenter did not suggest a definition

for this category. 

Response: Based upon review and evaluation of these

comments, follow-up information from the commenter and other tung

oil manufacturers, and State architectural coating rules, the EPA

has determined that a separate category for tung oil finishes is

not warranted. Tung oil finishes would be subject to the

varnishes category or the waterproofing sealers category with a

VOC content limit of 450 g/l or 600 g/l, respectively, depending

on how the coating is marketed and sold. In follow-up

information (IV-E-14), the commenter revealed that a compliant

product (335 g/l VOC content) is sold in regulated areas for

limited purposes. Moreover, the EPA is not aware of any State

architectural coating rules that have a separate category for

tung oil finishes.
2-171

According to follow-up information from one coating

manufacturer (IV-E-45), the term “tung oil” is used generically

within the industry and it could be 100 percent vegetable oil, or

a varnish for furniture and floors, or a waterproofing sealer,

depending upon its recommended use. This manufacturer markets a

similar product as a waterproofing sealer and submitted comments

(IV-D-169) on the VOC content limit for waterproofing sealers

that were marked confidential. In addition, follow-up

information obtained from another manufacturer (IV-E-46) revealed

that it markets tung oil as a rubbing finish topcoat, which is

sold as a varnish. This manufacturer stated that this product

must be applied extremely thin and, thus, a high VOC content of

650 g/l is needed for this varnish; however, this manufacturer

did not request a higher VOC content limit for varnishes than the

proposed limit of 450 g/l. According to a publication on floor

finishes (IV-J-1), many oil varnishes, in the past, were domestic

versions of marine products (such as spar varnish).

The EPA believes that a separate category for tung oil

finishes is not appropriate since the VOC content of these

products depends on the intended use, which is regulated through

the limits established for the various usage categories (e.g.,

varnishes and waterproofing sealers). The EPA notes that the

final rule provides compliance flexibility through the exceedance

fee and tonnage exemption, if needed, that would allow the

commenter to continue to market this specialty coating to meet

customer needs.

Lacquer stains.

Comment: Three commenters (IV-D-09/IV-D-183, IV-D-189,

IV-F-1q) requested that the EPA create a new category for lacquer

stains because they are an integral part of a fine wood finishing

system which includes clear lacquer finishes and lacquer sanding

sealers. Two of the commenters (IV-D-183, IV-D-189) suggested a

VOC content limit of 780 g/l for the new category and recommended

the following definition: “Lacquer stains: Semi-transparent

stains formulated and recommended specifically for use in
2-172

conjunction with clear lacquer finishes and lacquer sanding

sealers.”

Two of the commenters (IV-D-09/IV-D-183, IV-D-189) explained

that lacquer stains: (1) provide highlighting and minimal

coloring to unfinished wood surfaces; (2) enhance the natural

beauty of wood; and (3) bring out the natural wood grain by

coloring primarily the softer portion of the grain. These

commenters also stated that lacquer stains provide no protection

for the substrate and, therefore, must be top coated with a clear

coat. Two commenters (IV-D-183, IV-D-189) explained that the

primary use for lacquer stains is in new construction by

professional painters. Lacquer stains are applied via spraying

to bare wood and are primarily used when wood (cabinets, molding,

and paneling) is finished on site for the first time. The same

commenters stated that lacquer stains are a productivity tool for

the painting contractor because they dry quickly, are compatible

with lacquer sealers and topcoats, and can allow many finishing

jobs to be completed within the same day. One commenter

(IV-D-183) argued that without lacquer stains to color and

enhance the wood there will be little use for clear lacquer

finishes. According to this commenter, the other stain

categories in the proposed architectural coating rule are finish

coat products that perform very similarly to an exterior paint

and are not useable in producing the furniture-like finish that

is produced with lacquer stains and finishes. The commenter does

not recommend oil-based wiping stains as a replacement for

lacquer stains because: (1) 90 percent or more of the wiping

stain must be wiped from the surface being stained, creating

waste that becomes a spontaneous combustion problem and

(2) inter-coat adhesion problems cause film failure of the

finished product. In addition, oil wiping stains require hand

wiping and at least overnight drying before the lacquer sealer

and topcoat may be applied. According to another commenter

(IV-D-189), waterbased stains present drying problems, but also

have additional problems of grain raising and “blushing” of the

lacquer topcoat which is caused by the retention of water in the
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wood. Another commenter (IV-F-1q) added that lacquer stains are

made with cellulose, which is compatible with the wood, and with

the same resin used in the sealer and topcoat, which eliminates

intercoat adhesion problems between lacquer stain and a lacquer

sealer. Two of the commenters (IV-D-09/IV-D-183, IV-D-189)

maintained that the semi-transparent and opaque stains for which

categories were established in the proposed rule are finish coat

products, whereas lacquer stains are not finish coats.

Response: The EPA has carefully reviewed the information

submitted by the commenters and has determined that a separate

category for lacquer stains with a VOC content limit of 780 g/l

is not warranted. The lacquer stains specialty category was one

of the categories considered for inclusion in the proposed rule

based on requests from some manufacturers (61 FR 32739,

June 25, 1996). It was excluded because the EPA was concerned

that the overlap between lacquer stains and the more general

stain categories would allow higher VOC content lacquer stains

for uses in which lower VOC content stains would be acceptable

substitutes. The EPA does not agree with the commenters'

reasoning that a category of lacquer stains is warranted based on

their representation that the other stain categories are “finish”

products. Neither the definition of opaque stains (350 g/l) nor

the definition of clear and semi-transparent stains (550 g/l)

indicate that these stain categories are limited to finish

products. Similar to lacquer stains, the proposed stains

categories do not provide protection for the substrate and

generally must be coated with a top clear coat. A review of

State architectural coating rules showed that only Kentucky has a

category for lacquer stains with a VOC content limit of 550 g/l;

no other States have a separate category for lacquer stains. 

Moreover, this VOC content limit of 550 g/l for lacquer stains is

the same as the EPA's proposed VOC content limit for

semi-transparent stains. In addition, at least one State

regulatory agency (California-South Coast) regulates lacquer

stains as stains. Therefore, the EPA believes that it is

appropriate to regulate lacquer stains in the more general
2-174

category of stains. As stated in a previous response in

section 2.2.3 of this document, §59.402(b)(2) of the final rule

has been amended to clarify that lacquer stains would be

classified in the general stains categories. 

Zone marking coatings.

Comment: Twenty-three commenters, including coating

manufacturers, distributors, contractors, the Department of

Defense, and one national trade association submitted comments on

zone marking coatings. Nine of these commenters, including four

coating manufacturers (IV-D-45, IV-D-63, IV-D-153/IV-D-207,

IV-D-183), two distributors (IV-D-87, IV-D-139), one user

(IV-D-88), and one national trade association (IV-D-189)

requested that the EPA create a separate category for zone

marking coatings. The commenters indicated that the proposed VOC

content limit of 150 g/l for traffic marking coatings would

essentially ban the use of solventborne zone marking coatings and

force the use of water-based coatings. One commenter (IV-F-2)

does not believe that parking lot marking coatings that will

achieve the proposed VOC content limit are available. Another

commenter (IV-D-73) stated that its zone marking coatings do not

meet the proposed limit for traffic marking coatings at 150 g/l,

but the commenter did not provide any basis for this statement. 

Two commenters (IV-D-183, IV-D-207) suggested that the EPA

establish a VOC content limit of 450 g/l for the category. One

commenter (IV-D-63) suggested that the EPA create a category for

coatings for privately owned parking areas classified as a lowvolume coating with a VOC content limit of 425 g/l and labeled

for use on parking lots only. Alternatively, the commenter

suggested that parking lot coatings could be considered a niche

market because it is such a small percentage of total coating

volume when compared to coatings used on highways; this

manufacturer makes less than 1500 gallons per week. The

commenter stated that the proposed VOC content limit for traffic

marking coatings was much lower than limits for other categories,

which was unfair. This commenter added that the use of acetone
2-175

as a solvent as a means to achieve the proposed limit would be

entirely too dangerous due to its high flammability.

Commenters also suggested definitions for the new category

they sought. The commenters proposed the following zone marking

definitions: "Coatings formulated and recommended for marking or

striping curbs, driveways, parking lots, and sidewalks"

(IV-D-183); and "Coatings formulated and recommended for marking

and striping airport runways, parking lots, curbs, driveways, and

industrial traffic patterns" (IV-D-153/IV-D-207). This commenter

added that these areas must be marked for safety whenever the

need arises, without regard to temperature.

A Department of Defense (DOD) Steering Committee (IV-D-03,

IV-D-121), representing the Navy, Air Force, and Army, as well as

several DOD components and agencies, requested that for emergency

airfield marking operations, the EPA exempt traffic marking

coatings used on airfields and other military facilities under

cold weather conditions. One of the commenters (IV-D-121) argued

that existing waterborne airfield coatings cannot be successfully

applied at temperatures below 55 F. The commenter stated that o

the typical VOC content of its solventborne coatings is 350 g/l

to 400 g/l. The commenter explained that when airfield markings

become obscured, they no longer provide visual cues for safe

operation of aircraft and support vehicles and, therefore, must

be remarked immediately, regardless of temperature. The

commenter stated that in northern climates, operations could be

terminated or severely degraded if solvent-based materials are

not available for use at lower temperatures.

Three coating manufacturers (IV-D-44, IV-D-45, IV-D-93)

stated that oil-based zone marking paint could not be

manufactured at a VOC content of 150 g/l. One commenter

(IV-D-45) stated that fast drying, medium oil alkyds are the only

available medium for the high level of pigment in the coatings. 

According to this commenter, customers have deemed latex coatings

unacceptable when used on crosswalks and high traffic parking

lots. Another commenter (IV-D-93) suggested that the EPA

consider an exceedance fee mechanism and small quantity exemption
2-176

based on 5,000 gallons, or as a percentage of the company’s total

production in the final rule. 

Three commenters (IV-D-87, IV-D-88, IV-D-139) were concerned

that the quality and durability of the proposed lower-VOC content

traffic marking coatings have not been proven in parking lot

applications, especially over pavement coatings such as coal tar

and asphalt emulsion sealers. They suggested that coating

manufacturers conduct more testing and product improvement.

Seven parking lot striping contractors (IV-D-90, IV-D-91,

IV-D-92, IV-D-95, IV-D-99, IV-D-149, IV-D-150) argued that the

proposed regulation would be extremely detrimental to small

private sector parking lot striping contractors who would no

longer be able to operate and requested that these small

businesses be exempted from the regulation for several reasons. 

First, individuals and small businesses cannot afford the cost of

waterborne coating application equipment, estimated at $12,000 by

one commenter (IV-D-90) and ranging from $25,000 to $40,000 by

another commenter (IV-D-149), not including any work force

retraining costs. Two other commenters (IV-D-87, IV-D-139)

expressed concern that small businesses would need to purchase at

least $4,000 of new equipment in order to switch from

solvent-based to water-based coatings. Second, the commenters

claimed the work season in northern climates will be reduced by

about two months each year, thereby greatly reducing a small

business's ability to keep a competent work force and stay

financially viable (IV-D-139, IV-D-149, IV-D-150). Third, the

commenters questioned the compatibility of the proposed coatings

with coal tar and asphalt emulsion sealers (IV-D-87, IV-D-88,

IV-D-139, IV-D-149). Fourth, use of the proposed coatings for

work done at night and in parking garages in a constantly

changing climate, frequently when the temperature is below 50 F, o

was also questioned (IV-D-149). Fifth, commenters asserted that

waterbased coatings used in previous applications have not

lasted, resulting in marketing, warranty, and customer education

problems (IV-D-91, IV-D-99, IV-D-149).
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Three commenters (IV-D-93, IV-D-189, IV-D-207) explained

that the marking and striping of curbs, driveways, and sidewalks;

and parking lots, fire lanes, and handicap zones in commercial

areas (supermarkets, banks, shopping centers, etc.) present

unique application requirements because much of this marking must

be done at night when these areas are not in service. At night,

humidity is less than ideal. Therefore, these products must dry

extremely quickly. The commenters asserted that waterborne

products do not perform well in these applications because of the

dry time constraints and adverse conditions under which these

products are sometimes applied. One commenter (IV-D-207) argued

that these products are not intended for use as traffic marking

coatings and should be given a separate category. The commenter

maintained that these products are needed for the small

independent striping contractor to survive and traffic marking

coatings meeting the proposed VOC content limits do not work for

zone marking. Two other commenters (IV-D-63, IV-F-1q) also

maintained that higher humidity and lower temperatures would

prevent water-based paints from curing properly. One commenter

(IV-D-63) argued that waterbased coatings must be applied in

temperatures above 45 F with humidity lower than 75 percent to o

produce a satisfactory film.

One distributor selling to small contractors (IV-D-87) and

four small businesses (IV-D-63, IV-D-183, IV-D-207, IV-F-1q) were

also concerned that the rule would cause small businesses to cut

jobs or close because the proposed VOC content limit would force

applicators to use water-based coatings. One commenter (IV-D-63)

explained that most large government contractors have

sophisticated equipment that uses heat to accelerate dry time and

glass bead technology; however, small companies cannot afford

such equipment.

Another distributor (IV-D-83) who sells coatings to over

500 small and medium-sized contractors recommended a total

exemption of traffic and zone marking coatings that are used for

private sector work that could be implemented based on a label

change and container size of 5 gallons. The commenter gave the
2-178

following reasons for this request: (1) contractors do not have

the equipment necessary for the new coatings; (2) waterborne

coatings show signs of premature wear as early as 60 days after

application which could lead to accidents; (3) many contractors

are part-time and could be put out of business by the higher cost

of material and required equipment; and (4) private sector

applications generate more wear than public roadways due to less

structured and more frequent traffic patterns.

Response: The EPA has carefully evaluated the reasons

presented in the comments and agrees that a separate category for

zone marking coatings should be established in the final rule

with a VOC content limit of 450 g/l, as suggested by several

commenters. The EPA is limiting the zone marking coating

category to coatings sold in containers of 5 gallons or less. 

Available information (IV-E-20) reveals that State Departments of

Transportation buy traffic marking coatings in larger than

5-gallon containers, and the military airfields typically

purchase coatings in 5-gallon containers and transfer the

coatings to 1-gallon or 1-quart containers. The EPA believes

that this size restriction will discourage the use of zone

marking coatings in large-scale applications such as those for

general traffic markings intended for public roads and highways. 

Also, according to available information (IV-6-5), only about

10 percent of traffic marking coatings are used in areas such as

parking lots and garages. Thus, creation of this category will

result in only a limited amount of additional VOC emissions. The

category is defined in the final rule as follows: "Zone marking

coating means a coating formulated and recommended for marking

and striping driveways, parking lots, sidewalks, curbs, or

airport runways, and sold or distributed in a container with a

volume of 19 liters (5 gallons) or less." 

The EPA established this category to satisfy both economic

concerns of small applicators as well as performance

considerations for coatings used on airport runways, particularly

emergency airfield markings, and commercial service areas during

cold and very humid weather conditions. The commenters argued
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that higher humidity and lower temperatures at night prevent

waterborne coatings from curing properly in commercial service

areas. Continued availability of solventborne coatings for use

in these special situations will ensure safe airport operations

and eliminate the drying time constraints under which waterborne

coatings are sometimes applied. 

The decision to allow the use of solventborne coatings at a

VOC content limit of 450 g/l in zone marking applications

eliminates the need for small business applicators to purchase

new application equipment that would have been required for

waterborne coatings. 

Conversion varnishes.

Comment: Twenty-eight commenters (IV-D-47, IV-D-84,

IV-D-89, IV-D-94, IV-D-98, IV-D-100, IV-D-102 to IV-D-107,

IV-D-109, IV-D-111 to IV-D-113, IV-D-123, IV-D-124, IV-D-127,

IV-D-131 to IV-D-133, IV-D-135, IV-D-136, IV-D-144, IV-D-145,

IV-D-176, [six of these are from the same company], IV-G-04)

expressed concern over the effect of the architectural coating

rule on the availability of two specialty top coats, known as

“Swedish Finishes”, used in the hardwood floor finish industry. 

The commenters asserted that the proposed VOC content limits for

floor coatings (400 g/l) and varnishes (450 g/l) cannot be

achieved by their niche market, specialty conversion varnishes

due to substantial chemical, application, and performance

differences. The two top coats are manufactured in Sweden and,

according to the manufacturer, these coatings cannot be

reformulated to become VOC compliant because of their chemical

makeup(IV-D-105, IV-D-109, IV-D-124, IV-D-144, IV-D-176,

IV-G-04). The current VOC contents range from 535 g/l (IV-G-04)

to 725 g/l (IV-D-176) and, according to the manufacturers, any

efforts to reformulate the top coats would affect their

performance and their ability to compete in the specialty

conversion varnish coatings niche market. Several commenters

made recommendations to the EPA about how to modify the rule to

accommodate these coatings. Eleven commenters (IV-D-89, IV-D-94,

IV-D-103, IV-D-105, IV-D-106, IV-D-107, IV-D-131, IV-D-132,
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IV-D-133, IV-D-145, IV-D-176) argued that the EPA should consider

an exemption for low-volume, specialty niche products such as

specialty conversion varnish coatings. One commenter (IV-D-113)

suggested that coatings serving a specialty market and for which

there is no equivalent replacement be exempted from the

regulation. This commenter also suggested that the EPA consider

exemptions for products that are sold in low volumes. Ten other

commenters (IV-D-47, IV-D-84, IV-D-98, IV-D-102, IV-D-109,

IV-D-111, IV-D-123, IV-D-135, IV-D-136, IV-D-144) requested that

specialty conversion varnish coatings be exempted from the rule. 

Three commenters (IV-D-47, IV-D-104, IV-D-127) expressed

concern that these types of specialty conversion varnish coatings

will no longer be available in sizes larger than 1 liter (such as

1- and 5-gallon sizes). One commenter (IV-D-104) expressed

additional concern that limiting specialty conversion varnish

coatings to 1-quart containers would result in more wasted finish

and more containers in landfills, negating the intent of the

proposed rule. Twelve commenters (IV-D-84, IV-D-98, IV-D-103,

IV-D-105, IV-D-107, IV-D-111, IV-D-112, IV-D-113, IV-D-124,

IV-D-135, IV-D-136, IV-D-144) expressed concern that the proposed

rule would eliminate specialty conversion varnish coatings

altogether. 

One commenter (IV-D-176) recommended that the EPA establish

a new category for conversion varnishes with a VOC content limit

of 725 g/l due to the differences in chemical make-up and

performance between wood floor finishes and conversion varnish

top coats and provided the following definition for this unique

niche market: "Specialty conversion varnish coating means a

clear acid-curing coating with a polyvinyl butyryl resin blended

with amino resins and supplied as a single-component product. It

produces a hard, durable clear finish designed for professional

application to wood flooring." As stated previously, the

commenter argued that these coatings cannot be reformulated due

to their chemical make-up. Any reformulation of the two top

coats would reportedly affect their unique performance
2-181

capabilities and their ability to compete in the specialty

conversion varnish coatings niche market.

Another commenter (IV-G-04) also requested that the EPA

create a new category for conversion varnishes for the same

reasons stated in the previous comment (chemical and performance

differences), but requested a VOC content limit of 560 g/l. This

commenter stated that they have received approval from the State

of Oregon to sell their existing coatings (with VOC contents

ranging from 535 g/l to 560 g/l) to professional users until

January 1, 1998. For this commenter’s conversion varnishes, urea

resins are combined with alkyd resins which produces a finish of

relatively high solids content with a short drying time. This

coating is used as both a sealer and finish coat, so no special

sanding sealer with high VOC content is necessary. The commenter

stated that reformulation efforts with suppliers of alkyds and

urea resins are ongoing and will continue. The commenter stated

that oil-modified urethanes that comply with the proposed rule

also exist, but these coatings still have some limitations and

are very expensive. The commenter estimated that a total of only

about 200,000 gallons of this type of conversion varnish coating

(urea-alkyd resin) is used in the United States per year, which

they estimated to be less than 5 percent of the floor finishing

market nationwide. According to this commenter, without this

coating, which would be banned at the proposed VOC content limit

of 450 g/l for varnishes, hundreds of contractors will lose the

businesses on which they have built their reputation for the past

25 years.

Performance characteristics. According to commenters, these

specialty conversion varnish coatings have unique performance

capabilities which make them more desirable than competitive

coatings (IV-D-89, IV-D-94, IV-D-102, IV-D-105, IV-D-106,

IV-D-107, IV-D-109, IV-D-111, IV-D-112, IV-D-113, IV-D-123,

IV-D-131, IV-D-132, IV-D-133). First, the coatings can be

applied in 24 hours or less versus 2 days for waterborne coatings

(IV-D-103, IV-D-176). Second, according to the commenters, the

coatings are more durable (IV-D-47, IV-D-84, IV-D-89, IV-D-94,
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IV-D-100, IV-D-102, IV-D-103, IV-D-106, IV-D-107, IV-D-109,

IV-D-111, IV-D-112, IV-D-113, IV-D-123, IV-D-124, IV-D-131,

IV-D-132, IV-D-133, IV-D-127, IV-D-144, IV-D-145, IV-D-176) and

flexible (IV-D-100, IV-D-102, IV-D-104, IV-D-107, IV-D-109,

IV-D-144, IV-D-145, IV-D-176) and have a crystal clear appearance

that makes the hardwood floor more attractive (IV-D-102,

IV-D-103, IV-D-111, IV-D-123, IV-D-144, IV-D-176). The

commenters claimed that these finishes require less maintenance

because they are less likely to scratch, peel, or chip (IV-D-47,

IV-D-84, IV-D-112, IV-D-176). When small scratches and light

wear occur, the commenters asserted that they are easily repaired

without the need for sanding and recoating (IV-D-47, IV-D-84,

IV-D-102, IV-D-107, IV-D-145, IV-D-176). Typical finishes using

specialty conversion varnish coatings reportedly last over

10 years versus 2 to 3 years for waterborne finishes (IV-D-47,

IV-D-84, IV-D-89, IV-D-94, IV-D-105, IV-D-106, IV-D-131,

IV-D-132, IV-D-133, IV-D-176).

In addition, one commenter (IV-D-112) requested that the EPA

consider the durability and maintenance requirements of a coating

when establishing VOC content limits. Several commenters

(IV-D-47, IV-D-89, IV-D-94, IV-D-100, IV-D-103, IV-D-105,

IV-D-106, IV-D-111, IV-D-127, IV-D-131, IV-D-132, IV-D-133,

IV-D-145) stressed that using a specialty conversion varnish

coating requires fewer coats than when using comparable

waterborne finishes. Specifically, the commenters stated that

the specialty conversion varnish coating requires one coat of

sanding sealer and one coat of finish versus three to five coats

for other types of finishes. The commenters claimed that this

equates to lower overall VOC exposure over the floor's lifetime. 

Economic impact. Two conversion varnish top coats are

marketed and sold by a small company (IV-D-176) of 10 employees. 

Over 90 percent of the company's sales revenue comes from these

two coatings that are used in conjunction with one of the

company's compliant sanding sealers. Thus, if these coatings are

not exempted from the proposed rule, the company stated that they

will be put out of business. 
2-183

Twelve other commenters (IV-D-47, IV-D-98, IV-D-100,

IV-D-102, IV-D-103, IV-D-111, IV-D-113, IV-D-123, IV-D-135,

IV-D-136, IV-D-144, IV-D-145) stated that the proposed rule would

cause them a loss in sales or business if these coatings were no

longer available. Five commenters (IV-D-98, IV-D-100, IV-D-103,

IV-D-109, IV-D-112) expressed concern that the unavailability of

these coatings would adversely affect their business or cause

them economic hardship or financial difficulty. Two commenters

(IV-D-84, IV-D-103) argued that the proposed rule would cause

them or their clients to lose their competitive advantage. One

commenter (IV-D-145) claimed that the majority of their business

depends on their ability to provide these coatings.

Eleven commenters (IV-D-84, IV-D-89, IV-D-94, IV-D-102,

IV-D-106, IV-D-111, IV-D-127, IV-D-131, IV-D-132, IV-D-133,

IV-D-144) argued that the proposed rule would be a hardship on

contractors who use specialty conversion varnish coatings and

have built their reputation on these coatings. One commenter

(IV-D-103) expressed concern that it would be unable to compete

in outlying areas due to increased prices resulting from the

additional travel costs incurred because waterborne finishes

require an extra day to apply. Also, three commenters (IV-D-84,

IV-D-100, IV-D-105) expressed concern that contractor employees

would need to be retrained resulting in burdensome costs for the

contractor. One commenter (IV-D-145) argued that the proposed

rule would be a hardship on employees because the need for

employee retraining could result in employees losing their jobs.

Four commenters (IV-D-104, IV-D-107, IV-D-109, IV-D-112)

specifically discussed the loyal and dedicated following that

these conversion varnishes have among many contractors and

consumers and how consumers would continue to demand the high

performance and quality provided by these coatings. Another

commenter (IV-D-105) expressed concern over the loss to the

consumer that will occur if these coatings become unavailable. 

Finally, one commenter (IV-D-123) expressed concern that the lack

of these coatings could result in consumers choosing floor

coverings other than wood. Another commenter (IV-D-104) pointed
2-184

out that there are medical benefits provided by hardwood floors

over carpeting, citing an example in which a child’s asthma

virtually disappeared after a change from carpet to hardwood

floors. 

Three commenters (IV-D-111, IV-D-112, IV-D-113) also raised

several economic issues regarding the regulatory development

process. One commenter (IV-D-111) suggested that the EPA

consider the impact that regulations will have on coatings and

companies that depend on those coatings. The commenters

recommended that the EPA consider such questions as: (1) What

coatings will be eliminated? (2) What companies will be damaged

or put out of business? (3) How many independent flooring

contractors will lose business when the finish system they built

their reputation on is no longer available? Two of the

commenters (IV-D-124, IV-D-127) requested that the EPA review the

impact of the proposed rule on small flooring businesses. 

One commenter (IV-D-113) maintained that it is unfair for

the EPA to apply VOC content limits to an entire industry without

considering the distinctions between coatings and applications. 

The commenter argued that high-volume coatings can afford to

reformulate. On the other hand, the commenter believed that lowvolume specialty coatings should be considered separately. One

commenter (IV-D-102) stated that including specialty conversion

varnish coatings in a "one rule fits all" type of regulation,

with no consideration of coating performance and uniqueness, is a

great injustice to the contractors who use them and the

homeowners who rely on them.

Chemical differences. One commenter (IV-D-176) recommended

that more detailed definitions for wood floor finishes be

included in the rule because the company’s two conversion varnish

top coats do not fit into the definitions provided by the EPA. 

The commenter based this recommendation on (1) chemical

differences between specialty conversion varnish coatings and the

definitions in the proposed rule for floor coatings and

varnishes, (2) the inability to reformulate specialty conversion

varnish coatings within the next 3 years, and (3) the niche
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market that these types of floor finishes serve. The commenter

claimed that specialty conversion varnish coatings are more

sophisticated forms of conversion varnishes. According to the

commenter, there are clear chemical differences between a varnish

and a conversion varnish, and there are also clear chemical

differences between a conversion varnish and a specialty

conversion varnish coating. 

First, the commenter explained that specialty conversion

varnish coatings use a combination of polyvinyl butyryl and amino

resins and rely on an acid catalyst to initiate the reaction. 

However, specialty conversion varnish coatings are delivered in a

pre-catalyzed, single package system. This single package system

is accomplished by stabilizing or blocking the reaction with the

solvent system. Because specialty conversion varnish coatings

use a system of ionic bonding between two very different resins

(polyvinyl butyryl and amino resins), they also provide a much

tougher coating than one that cures through oxidation.

In defense of adding a definition for specialty conversion

varnish coatings based on the unique chemistry of these coatings,

the commenter (IV-D-176) cited the precedent established by the

EPA in categorizing coatings that often reflect chemical

differences and unique specialty products.

Second, because specialty conversion varnish coatings use

polyvinyl butyryl resin, the commenter argued that they cannot be

reformulated with current technology to become compliant at the

proposed VOC content limits. There are three strategies that the

commenter has tried unsuccessfully for reducing the VOC content: 

reformulation with acetone, reformulation with a lower viscosity

resin, and emulsification of the coating made at very high

viscosity (low VOC) in water. The commenter presented the

details of problems associated with the unsuccessful attempts at

reformulation in these areas.

Third, due to its chemical differences, which lead to

significant differences in performance and quality, specialty

conversion varnish coatings serve a niche market in the hardwood

floor finish industry (IV-D-47, IV-D-84, IV-D-100, IV-D-102,
2-186

IV-D-103, IV-D-105, IV-D-107, IV-D-111, IV-D-124, IV-D-127,

IV-D-135, IV-D-136, IV-D-145, IV-D-176). According to one

commenter (IV-D-176), there are only three companies that compete

in this small sector of the industry and, according to its trade

publications, their total coatings account for only 3 percent of

the hardwood floor finish market. This commenter stated that all

of these specialty conversion varnish coatings are marketed and

sold only to licensed professional wood flooring contractors. 

Low-volume limit. One commenter (IV-D-176) regarded the

suggested potential exemption level of 1,000 to 5,000 gallons as

too low because it would include only those one-person or parttime manufacturers who operate out of their homes and by word of

mouth. The commenter contended that these manufacturers fit the

EPA's concept of a small, low-volume company operating in a niche

market because they are considered by industry analysts and

competitors to be a small firm in the hardwood floor finish

industry, they employ only ten employees, and over 90 percent of

their sales come from four products. The commenter maintained

that the low-volume level should be increased to cover small,

niche market firms that will endure great economic hardship

because of the architectural coating rule. The commenter

suggested that the EPA consider a low-volume level of

100,000 gallons, which would exclude medium- and large-sized

manufacturers but would include small companies that focus on

niche markets.

Exceedance fees. Several commenters (IV-D-105, IV-D-107,

IV-D-176) also supported an exceedance fee as an option for

maintaining the availability of specialty conversion varnish

coatings. One commenter (IV-D-176) argued that a reasonably

priced exceedance fee provides a way for relatively small, lowvolume companies to survive new stricter VOC laws. According to

the commenter, it also provides a way for unique, niche market

coatings that cannot currently be reformulated to meet the VOC

content limits and maintain performance characteristics to

survive.
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Variances. One commenter (IV-D-176) asserted that a

variance as currently proposed by the EPA would not be useful for

specialty conversion varnish coatings. These coatings have a

unique chemical makeup that has not been successfully

reformulated and the development of resin technology in the next

few years that could make reformulation successful is improbable. 

The commenter argued that a variance would only extend the time

available to continue research, which would likely fail to

produce a comparable compliant product.

Response: After evaluation of available information, the

EPA has determined that a new category for conversion varnishes

is warranted. The EPA has established the category with a VOC

content limit of 725 g/l, as suggested. The following

definition, which was suggested by two of the three manufacturers

(IV-E-39), is included in the final rule: “Conversion varnish

means a clear acid curing coating with an alkyd or other resin

blended with amino resins and supplied as a single-component or

2-component product. Conversion varnishes produce a hard,

durable, clear finish designed for professional application to

wood flooring. The film formation is the result of an acidcatalyzed condensation reaction, affecting a transetherification

at the reactive ethers of the amino resins."

This category has been created for several reasons. This

coating category represents a niche market that has chemical

differences that can be specified to distinguish it from the

broad category of varnishes and ensure that this category is

limited to the applications for which it is intended. Three

manufacturers market these coatings. Due to the chemical makeup

of conversion varnishes, these manufacturers have reportedly been

unable to reformulate these coatings to meet the 450 g/l VOC

content limit for varnishes. The information available to the

EPA indicates that there is no lower-VOC substitute for this type

of coating and that it is not technologically feasible to

reformulate it at this time. Only three companies compete in

this niche market and, according to its trade publications, these

coatings represent a small portion (about 3 percent) of the total
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national hardwood floor finishing market. As such, the EPA

believes that no significant increase in VOC emissions will

result from providing a higher VOC content limit for this

specialty niche category and that it is important to preserve

this market for the hardwood floor finishing industry.

Elastomeric high performance industrial finishes.

Comment: One commenter (IV-G-02) requested that the EPA

establish a new category to encompass approximately 10 different

coatings under the company’s product line with the following

definition: "Elastomeric high performance industrial finishes

means a coating formulated and recommended to provide a weather,

moisture, or abuse barrier on top of insulated piping and tanks

on cold work systems as a component of insulation systems with

moisture permeance less than 0.10 U.S. perms." The commenter

proposed that this category have a VOC content limit of 650 g/l.

The commenter argued that this limit would allow this specialized

category of coatings to continue to be available for nationwide

use.

The commenter argued that this product line would fall into

either the flat or nonflat coatings category in the proposed

rule, with a VOC content limit of either 250 g/l or 380 g/l

(specular gloss testing has not been done on these coatings). 

This product line has VOC contents much higher than allowed under

either the flat or nonflat categories.

According to the commenter, these coatings consist primarily

of solvent and Hypalon with VOC contents ranging from 495 to

635 g/l of coating. These coatings function as a weather,

moisture, and abuse barrier on top of insulated piping and tanks

on cold work systems. For example, these coatings are used over

insulation on a liquid nitrogen tank and the associated piping

system. By adding to the insulating properties, these coatings

also function as an energy conservation coating to the insulation

system. These systems typically operate at a temperature range

of -40 F to +250 F. Also, the materials in the insulated o o

system have a temperature range of -250 F to +32 F. o o
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The commenter claimed that these specialized coatings differ

from other coatings in the following ways:

1. Offer the best chemical resistance available against

many industrial chemicals;

2. Display unmatched long-term weatherability;

3. Exhibit unmatched toughness, resisting punctures by

hail, dropped tools, etc.;

4. Function in a service temperature range of -40 F to o

+250 F; and o

5. Have a very low moisture vapor permeability, which is

very necessary for cryogenic work.

The commenter sells these products in small quantities (less

than 5,000 gallons) nationwide and in larger quantities

internationally. If a new category is not established for these

coatings, the commenter supported the inclusion of a low-volume

category exemption of 5,000 to 10,000 gallons in the final rule.

Response: After review and careful consideration of this

request, the EPA has determined that a new category for

elastomeric high performance industrial finishes is not

warranted. As described by the commenter, these coatings

function as a weather, moisture, and abuse barrier on top of

insulated piping and tanks on cold work systems. As such, these

coatings would fall in the industrial maintenance coatings

category, which includes high performance industrial coatings

that are exposed to one or more extreme environmental conditions

such as those described by the commenter. The industrial

maintenance coatings category has a VOC content limit of 450 g/l. 

Moreover, none of the State architectural rules reviewed have a

category for elastomeric high performance industrial finishes. 

Since these products are sold in quantities of less than

5,000 gallons in the United States, the commenter could consider

using the tonnage exemption and/or the exceedance fee in the

final rule as alternative compliance options. These provisions

could allow the continued sale of these coatings.
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Thermoplastic (treatment) sealer.

Comment: One commenter (IV-G-11/IV-E-25) requested that the

EPA establish a new category for thermoplastic treatment sealers

with a VOC content limit of 630 g/l. The commenter argued that

these coatings cannot be reformulated to meet the proposed VOC

content limit of 400 g/l for opaque waterproof treatment sealers. 

The commenter explained that the opaque waterproof treatment

sealer VOC content limit applies because the coatings are used

for waterproofing basements and foundations, and currently, on a

trial basis, in one municipal swimming pool. Since these

coatings seal surfaces and reduce microbial adhesion, the

commenter stated that they are also useful for providing more

sanitary environments for food, animals and water containers. In

follow-up information, the commenter (IV-E-DeZurik) maintained

that the thermoplastic rubber coatings and mastics category

definition in the proposal does not apply because the commenter’s

products are hard thermoplastic coatings that contain less than

15 percent by weight of thermoplastic rubbers in the total resin

solids. The commenter (IV-E-25) suggested the following new

category definition: “Thermoplastic (treatment) sealer means a

coating applied to porous surfaces. This coating comprises a

styrene-containing binder resin dissolved in organic solvent

wherein styrene constitutes at least 85 percent by weight of the

binder resin and forms a hard coating with minimal deformation

that binds securely to concrete.”

The commenter implied that the durability of the coatings

would justify a VOC content higher than 400g/l. The commenter

estimated that the coating material would last 150 years;

however, the company does not have data on the lifetime of its

coatings since this is a new coating technology. The commenter

claimed that its coatings will outlast most other coatings,

including tar, which is a competing foundation coating. 

Furthermore, the commenter asserted that there may be unfavorable

characteristics from competing products: tar may leach into the

ground and water and has associated health hazards, and epoxies

may require replacement for repair. This is the only coating
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manufactured and marketed by this small business. The commenter

(IV-E-25) stated that the company’s annual production of this

coating is 85,000 gallons, with a cost of $8 to $10 per gallon. 

Although the commenter claimed that the coating cannot be

manufactured to meet the 400 g/l VOC content limit for opaque

waterproofing treatment sealers with current technology without

reducing performance and durability, the company has developed a

coating which complies with California’s Rule 66 (at a VOC

content of 420 g/l). This coating is more expensive to produce

because the raw materials cost more. 

Response: The EPA has carefully evaluated the information

presented by the commenter and has determined that a new category

for thermoplastic (treatment) sealers with a VOC content limit of

630 g/l is not warranted. As described, thermoplastic sealers

are used for waterproofing basements and foundations and, thus,

would be classified under the category of waterproofing sealers

and treatments. However, as discussed in section 2.2.4.3 of this

document, in the final rule, the EPA has combined the clear and

opaque waterproofing treatment sealer categories into one

category with a VOC content limit of 600 g/l. The decision to

combine the categories is consistent with State architectural

coating rules. Based on evaluation of information provided by

the commenter, the EPA’s decision to combine opaque and clear

waterproofing treatment sealers into one category with a VOC

content limit of 600 g/l, and considering the compliance

flexibility in the final rule (the exceedance fee and tonnage

exemption provisions), the EPA believes that the commenter can

continue to manufacture the coating in a competitive manner

without affecting its performance and durability. The EPA notes

that the commenter has successfully developed a lower VOC product

for use in California. The EPA supports the development of such

lower VOC products. The rule includes a tonnage exemption and an

exceedance fee provision that will assist the commenter.
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2.2.4.3 Proposed Categories

Antifouling coatings.

Comment: Two commenters (IV-D-173, IV-D-189) requested a

higher VOC content limit for the antifouling category. One

commenter (IV-D-189) suggested that the EPA increase the VOC

content limit for the antifouling category to 450 g/l and the

other commenter did not specify a level. The commenter that

requested the 450 g/l limit explained that the coating industry

deemed the 400 g/l limit too low to allow for adequate

application and use as an architectural coating. The commenter

maintained that it is inappropriate to apply the same VOC level

as provided in the Shipbuilding and Ship Repair (Surface Coating)

Operations NESHAP to architectural coatings without recognizing

the significant differences between the two end uses:

(1) antifouling architectural coatings are generally not applied

at fixed manufacturing/repair facilities where painting

conditions are more easily controlled, and (2) the shipbuilding

rule explicitly provides a cold weather thinning exemption to its

limit of 400 g/l, which allows a facility to thin the regulated

coating so that the VOC content is higher than the limit

specified during cold weather coating operations. This is a

feature the commenter considered essential for architectural

coatings as well. The other commenter (IV-D-173) explained that

antifouling marine coatings save enough fuel to offset emissions

from the paint. The commenter explained that antifouling marine

coatings are subject to naval specifications so reformulation and

approval are expensive and time consuming. The commenter stated

that if the 400 g/l VOC content limit were retained in the final

rule, the commenter’s estimated lost sales would be $70,000 for

the antifouling category, in addition to expected sales losses

for other products.

Response: The antifouling coating category in the

architectural coating rule includes coatings used on stationary

structures, such as docks, sea walls, boat slips, etc. These

coatings are similar, and perhaps the same in some cases, as

those used to coat ships. After consideration of the comments,
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the EPA agrees that these architectural coatings may need extra

thinning in cold weather situations and, therefore, has raised

the VOC content limit for antifouling coatings to 450 g/l in the

final rule to allow for such cold-weather thinning. Also,

similar to nuclear coatings, these coatings are subject to some

of the same extreme environmental conditions as industrial

maintenance coatings and must meet other rigorous requirements,

such as those under the FIFRA. Moreover, this is one of 17

specialty coating categories that did not appear in existing

State architectural coating rules, and no data were collected in

the 1990 VOC Emissions Inventory Survey. Therefore, the EPA

believes that a low volume of coatings will be affected by this

change.

Bituminous coatings and mastics.

Comment: One commenter (IV-D-181), a national trade

association comprised of 60 roof coating manufacturers and their

suppliers, supported the proposed VOC content limits for roof

coatings, bituminous coatings and mastics, and metallic pigmented

coatings, and the inclusion of all bituminous coatings in the

bituminous coatings and mastics category. Two commenters

(IV-D-30, IV-D-114) suggested reducing the proposed VOC content

limit of 500 g/l for bituminous coatings and mastics. One

commenter (IV-D-30) stated that existing technology permitted the

manufacture of bituminous coatings at a VOC content limit of

350 g/l. The other commenter (IV-D-114) recommended adopting one

roof coating category that includes bituminous materials at a VOC

content limit of 300 g/l for several reasons. The commenter

pointed out that the proposed Federal regulation, unlike State

rules, classifies competing roofing products into different

categories with significantly different VOC content limits. The

commenter notes, for example, that bituminous materials and other

roof coatings are subject to the same VOC content limit (300 g/l)

in both the California Bay Area Air Quality Management District

and the South Coast Air Quality Management District regulations. 

In the proposed rule, the commenter complained that bituminous

materials (500 g/l) used for roof coating would be granted a VOC
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content limit that is twice the limit for non-bituminous roof

coatings (250 g/l). The commenter maintained that this would

create a large cost advantage for bituminous manufacturers and

would allow them to continue to pollute. Furthermore, at the

proposed VOC content limit, the commenters claimed that

manufacturers of non-bituminous roof coatings that reformulated

to meet State (300 g/l) VOC regulations would need to reformulate

again to meet the lower Federal VOC content limit (250 g/l). The

commenter reportedly already spent several thousand dollars to

reformulate to 300 g/l to meet the roof coating VOC content limit

in the State rule.

The commenter stated that the background documents for the

proposed Federal regulation provide no justification for separate

categories for bituminous and roof coatings or the reduction of

the State VOC content limit of 300 g/l to 250 g/l for roof

coatings. The commenter maintained that allowing a higher VOC

content for bituminous roof coatings and restricting nonbituminous roof coatings below the VOC control level found in

existing State rules puts non-bituminous roof coating

manufacturers at a competitive disadvantage.

Response: The EPA has reviewed its basis for establishing

the proposed category for bituminous coatings and mastics and VOC

content limit of 500 g/l and has decided to retain this category

and limit in the final rule. The EPA reviewed information

submitted by the National Roof Coatings Manufacturers Association

(comprised of 60 bituminous and nonbituminous coating

manufacturers and suppliers), before proposal (II-D-56),

regarding the composition, specialized manufacture, performance,

and use limitations of these coatings. According to this

information, a significant portion of these coatings are needed

for repair and maintenance of existing roofs, as well as for

installing new roofing systems. The trade association claimed

that waterborne bituminous coatings and mastics are not practical

in many of the applications where solventborne bituminous

coatings and mastics are used and that coating performance

comparisons between waterborne and solventborne bituminous
2-195

coatings and mastics range from good to very poor, depending on

conditions. In particular, before proposal the national Roofing

Contractors Association (also II-D-56), which has over

3,500 members represented in all 50 States, argued that there is

no viable alternative in many circumstances and pointed to

bituminous primers as an example of this. According to this

trade association, if the VOC content level were reduced by any

significant amount in these primers, the adhesion properties, the

application process, and the life of the roof will suffer

dramatically.

Before proposal, one coatings manufacturer (II-D-125) argued

that the average VOC content for bituminous coatings is 400 g/l. 

Currently, the State of Arizona and the California-South Coast

Air Quality Management District have a VOC content limit of

420 g/l for bituminous coatings and mastics. In addition, after

proposal the national Roof Coatings Manufacturers Association

(IV-D-181) supported the proposed VOC content limit of 500 g/l

for bituminous coatings and mastics. In order to satisfy

performance requirements of bituminous coatings and mastics

nationwide, the EPA has retained this category with a VOC content

limit of 500 g/l in the final rule.

The EPA disagrees that the roof coating category limit

should be raised from 250 g/l to 300 g/l. Although there are

several State architectural coating rules that have a VOC content

limit of 300 g/l for roof coatings, the EPA believes that the

national Roof Coatings Manufacturers Association’s support

(IV-D-181) of the proposed VOC content limit for roof coatings at

250 g/l provides convincing evidence that this limit is being

achieved nationwide. Therefore, the EPA has retained this limit

in the final rule.

Roof coatings.

Comment: One commenter (IV-D-74) produces less than

400 gallons per year of a roof coating with VOC content levels

ranging from 453 g/l to 509 g/l. The commenter requested a

variance for roof coatings (a VOC content limit of 250 g/l was

proposed and this limit was retained in the final rule).
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Response: As discussed in section 2.2.8 of this document,

the proposed variance provisions have not been retained in the

final rule. However, the final rule includes a VOC tonnage

exemption that could be used for low-volume products such as

those described by the commenter.

Dry fog coatings.

Comment: Three commenters (IV-D-44, IV-D-182, IV-F-2m)

stated that the proposed VOC content limits for dry fog coatings

should be raised. None of the commenters recommended a specific

VOC content limit. One commenter (IV-F-2m) stated that the

400 g/l limit was impossible to meet. Two commenters (IV-D-44,

IV-D-182) stated that the limit would affect performance

characteristics. One commenter (IV-D-44) specified that dry fog

coatings at 400 g/l VOC content would have increased drying time,

poor leveling properties, and poor durability. The commenter

stated that drying time is a critical performance characteristic

for several coatings including dry fog coatings. The commenter

stated that two options to reduce VOC content exist: increase

solids or reduce solvents. According to the commenter, both

options increase drying time. Both commenters stated that they

did not have documentation that could be made public to support

their arguments.

Response: The EPA has retained the proposed VOC content

limit of 400 g/l for dry fog coatings based on consideration of

the 1990 VOC Emissions Inventory Survey and requirements in State

architectural coating rules. According to the 1990 VOC Emissions

Inventory Survey, approximately 84 percent of waterborne and

solventborne dry fog coatings sales were manufactured at or below

400 g/l. Also, a review of existing State architectural coating

rules reveals several States, including Arizona, Kentucky,

New York, New Jersey, Massachusetts, Rhode Island, and

California-South Coast and Sacramento, have rules that contain a

400 g/l VOC content limit for dry fog coatings. Therefore, the

survey data and existing State regulations suggest that dry fog

coatings formulated at or below 400 g/l VOC content perform at an

acceptable level. 
2-197

Flat coatings.

Comment: One commenter (IV-D-191) stated that the proposed

flat coatings category VOC content limit of 250 g/l was not

stringent enough. The commenter recommended a 100 g/l VOC

content limit for 1997 and a 0 g/l limit for 2000. The commenter

reported obtaining and successfully using zero- and low-VOC flat

coatings. Therefore, the commenter concluded that a zero-VOC

limit for 2000 is technologically and economically feasible. The

commenter referred to California-South Coast’s November 8, 1996,

proposal to phase in a 100 g/l VOC content limit for the flat

coating category in 2001 and 50 g/l in 2008. The commenter

maintained that the California South Coast limits were also too

weak given the time for compliance, although they are more

stringent then the limits in the proposed national rule. The

commenter reported that 40 percent of the flat coatings on the

market in Southern California meet the 100 g/l limit and

12 percent meet the 50 g/l limit. The commenter maintained that

these coatings are cleaner and safer and that the EPA did not

calculate the cost savings resulting from workers not having to

leave the building during painting operations with these

coatings. 

Response: The EPA has retained the VOC content limit of

250 g/l for flat coatings in the final rule rather than lowering

the level as the commenter requested. The 1990 VOC Emission

Inventory Survey revealed that 45 percent of exterior flat

coatings and 49 percent of interior flat coatings sold were

between the 100 g/l limit the commenter requested and the

proposed limit of 250 g/l. In addition, all of the State

regulations reviewed, including those for California Air Quality

Management Districts, Kentucky, Rhode Island, Massachusetts, New

York, New Jersey, and Texas, have VOC content limits of 250 g/l

for flat coatings.

Although the EPA acknowledges the use of low-VOC coatings in

Southern California as well as many lower and no-VOC flat

coatings marketed across the country, the EPA has retained the

250 g/l VOC content limit based on survey data and State
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architectural coating rules. As discussed in several responses

in this document, the VOC content limits in the final rule

reflect BAC and were selected after consideration of a variety of

factors on a nationwide basis. Local areas may find it

appropriate to require more stringent limits based on local

conditions, but the EPA must base national rules on achievability

in all areas of the country under many different conditions.

Graphic arts coatings.

Comment: Two commenters (IV-D-02/IV-D-178/

IV-F-01(l), IV-D-168) were concerned about the performance of

graphic arts coatings at the proposed VOC content limit of

500 g/l. Neither of the commenters suggested an alternative VOC

content limit. One commenter (IV-D-168) envisioned that the

decrease in the VOC content of graphic arts coatings will affect

their suitability for use in the sign industry. The commenter

offered some potential impacts on the sign coatings industry,

including difficulty in achieving variation in gloss levels,

varying drying times in the drying room (implying shop-applied

coatings), need for greater application amounts, and higher

costs. The other commenter (IV-D-02/IV-D-178/IV-F-01(l))

explained that graphic arts coatings are formulated to address

specific performance needs. For example, lettering enamels are

designed to cover in one brush stroke and maintain a sharp edge. 

To reduce artist fatigue when painting billboards 8 hours a day,

bulletin enamels were developed with sufficient slip to reduce

draft. The commenter mentioned that graphic arts coatings are

exempt in the California-Bay Area regulation and urged the EPA to

reevaluate the proposal because they did not know if

reformulation attempts would succeed. Moreover, the commenter

pointed to the graphic arts category as an example of a niche

market where a replacement system was unavailable because the

small demand does not justify expenditures required for raw

material suppliers to develop a new resin. The commenter

manufactures 30 different graphics arts coatings that would be

banned by the rule.
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Response: Graphic arts coatings recommended by the

manufacturer solely for shop applications are not required to

meet the 500 g/l VOC content limit. To clarify this, the

definition of graphic arts coating has been modified by removing

the reference to in-shop coatings, and the definition of

architectural coating has been revised to clarify that coatings

recommended by the manufacturer solely for shop application are

not subject to the rule. In addition, a definition of shop

application has been added to the final rule. Although the

commenters asserted that the proposed VOC content limit of

500 g/l will cause poor performance, they did not recommend an

alternative level. The EPA has determined that the 500 g/l limit

for field-applied graphic arts coatings is achievable, based on

survey data and State architectural coating rules. A review of

existing State regulations revealed several States with lower VOC

limits: Massachusetts, New York, New Jersey, and Rhode Island at

450 g/l, and some at 500 g/l (Kentucky and California-Sacramento

and South Coast). However, the category (including shop-applied

coatings) is exempt in several California counties (Batte,

Calusa, El Dorado, and Feather) and Arizona (Maricopa County). 

Based on the 1990 VOC Emissions Inventory Survey, approximately

96 percent of these coatings were manufactured with VOC contents

at or below 500 g/l.

Industrial maintenance coatings.

Comment: One commenter (IV-D-18) recommended that the VOC

content limit for the industrial maintenance coatings category

(450 g/l) be reduced to 350 g/l. The commenter argued that the

same coatings are applied to miscellaneous metal parts for which

a Control Techniques Guideline (CTG) document has specified a VOC

content limit of 340 g/l as reasonably available control

technology. According to the commenter, many of the same

coatings are routinely used, regardless of whether the structure

is field-coated or coated in a fabrication shop. Another

commenter (IV-D-45) stated that industrial maintenance products

can be reformulated and manufactured to meet the proposed limits. 

The commenter expressed concern about product performance at the
2-200

450 g/l level, but he did not believe the changes would

jeopardize his business.

Response: As discussed elsewhere in this document, the rule

does not apply to shop-applied coatings (see definition of shop

application). Industrial maintenance coatings is a broad

category that includes many different coatings with a wide range

of end uses and end users. The CTG for coating of miscellaneous

metal parts applies to coatings that are used in a shop setting

under controlled conditions and for products that are being

manufactured, often with the use of coating curing ovens. 

Industrial maintenance coatings covered by the architectural

coatings rule, on the other hand, are field applied under many

different climatic conditions and are air-dried. Thus, it is not

appropriate to assume that they can achieve the same VOC content

levels as shop-applied coatings, although some individual

coatings may be able to. Although the EPA recognizes that there

are many individual industrial maintenance coatings that have VOC

content levels below the proposed VOC content limit of 450 g/l,

the EPA has decided to retain this limit for industrial

maintenance coatings as a whole since it is consistent with

existing State architectural coating rules and survey data. A

review of existing State regulations revealed several States with

the same or similar levels, including Kentucky, New Jersey,

Massachusetts, Rhode Island and New York at 450 g/l; and

California-Sacramento, Bay Area, and South Coast at 420 g/l. In

addition, the 1990 VOC Emissions Inventory Survey indicated that

50 percent of industrial maintenance coatings were sold in the

350-450 g/l VOC content range in 1990, indicating that a large

portion of coatings in this category are in compliance with the

limit. 

Metallic pigmented coatings.

Comment: One commenter (IV-D-18) suggested that the EPA

reduce the VOC content limit for metallic pigmented coatings from

500 g/l to 350 g/l. Similar to industrial maintenance coatings,

the commenter stated that many of the same coatings are applied

both in shops and in the field. The commenter also noted that
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these applications are regulated under the CTG for miscellaneous

metal parts at a VOC content limit of 340 g/l. Another commenter

(IV-D-2) argued that they cannot meet the 500 g/l limit, but

offered no basis for this statement. One commenter (IV-D-181), a

national trade association, supported the proposed VOC content

limit for metallic pigmented coatings.

Response: As discussed previously, the rule does not apply

to shop-applied coatings. Although metallic pigmented coatings

are available with VOC contents below 350 g/l, the EPA has

decided to retain the proposed limit (500 g/l) based on

consideration of existing State architectural coating rules as

well as available survey data on the VOC content of metallic

pigmented coatings and due to the broadness of this category,

which includes applications outside of those highlighted by the

commenter. For example, other comments (II-D-75, II-D-156)

received before proposal indicated that there are major

differences between types and uses of zinc coatings, which are

included in the metallic pigmented coatings category, and that it

may not be feasible to apply VOC content limits designed for one

technology to a completely different technology. A typical

application of zinc-rich coatings would be a structural steel

frame for a large, multi-story building. The performance

requirements for such an application would be different than

those for miscellaneous metal parts, particularly in view of the

fact that these metal parts are routinely coating in fabrication

shops as described by one commenter (IV-D-18).

A review of existing State regulations revealed several

States with a 500 g/l limit, including Kentucky, New York,

New Jersey, Massachusetts, Rhode Island, and CaliforniaSacramento, Bay Area, and South Coast. Furthermore,

approximately 90 percent of all metallic pigmented coatings

represented in the 1990 VOC Emissions Inventory Survey data had

VOC contents in the 350-500 g/l range.

Nonflat exterior.

Comment: One commenter (IV-D-45) requested a VOC content

limit higher than the proposed limit of 380 g/l for exterior
2-202

nonflat coatings. The commenter explained that house trim paints

are nonflat exterior coatings that consist of a mixture of highgloss enamel and house paint. The enamel creates desirable

hardness and glossiness that prevent color deterioration. The

commenter stated that the company manufactured 1,150 gallons of

exterior nonflat coatings (four house trim colors) in 1994 and

710 gallons in 1995 with VOC contents ranging from 422-449 g/l. 

According to the commenter, the industry has shifted to latex

systems, but these systems have limitations. Specifically, the

commenter stated that application is limited by cold weather, and

conversion to latex systems is expensive because it requires

two coats plus a primer.

Response: The EPA has decided to retain the proposed VOC

content limit for exterior nonflat coatings of 380 g/l based on

available survey data on the VOC content of nonflat exterior

coatings, existing State architectural coating rules, and

performance studies of low-VOC coatings (IV-B-4). The 1990 VOC

Emissions Inventory Survey indicated that about 87 percent of

exterior nonflat coatings were sold at or below the proposed

limit in 1990. In addition, several existing State regulations,

including Kentucky, Massachusetts, California-Bay Area, Rhode

Island, New York and New Jersey, limit the VOC content of nonflat

coatings to 380 g/l. Also, according to studies conducted on the

weathering performance of several different finishes used to coat

aspen siding exposed outdoors on fences in the States of

Wisconsin, Mississippi, and Washington, the best finishes were

acrylic latex coatings. Even after 10 years of exposure at the

three locations, the studies indicated that two coats of acrylic

latex over an acrylic latex or oil-based primer provided very

good protection and appearance. The EPA notes that these are

subjective considerations, but the studies confirm that lower VOC

coatings can be effective in this category. The EPA, therefore,

believes that the available information indicates that a limit of

380 g/l is appropriate. The EPA notes that the final rule

contains a tonnage exemption and an exceedance fee mechanism that

may provide flexibility for the commenter.
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 Nonflat interior.

Comment: One commenter declared in two letters

(IV-D-153/IV-D-207) that the interior nonflat category should be

divided into water-based (380 g/l) and solvent-based (500 g/l)

categories. According to the commenter, the proposed 380 g/l VOC

content limit can be met by water-based products; however, there

are still applications where the solvent-based product will

outperform its latex counterpart. The commenter (IV-D-153)

provided the example that two coats of a solvent-based enamel

prevents old lead paint from becoming an environmental problem. 

The commenter argued that formulating solvent-based coatings with

VOC contents lower than 500 g/l causes deficiencies in color

retention, gloss retention, viscosity, and application

characteristics and may result in increased solvent use for

thinning. On the other hand, two commenters (IV-D-172, IV-E-60)

that manufacture encapsulants for lead-based paint indicated that

their products meet the limit for flat coatings (250 g/l) or for

nonflat coatings (380 g/l). (These coatings are subject to the

limits for the flat or nonflat category, depending on the gloss

level of the coating.) 

One commenter (IV-F-2j) stated that the nonflat coatings

limit should be around 500 g/l or in the high 400's to

accommodate gloss enamels, rather than at 380 g/l, but they did

not provide any supporting documentation. One commenter

(IV-D-206), a national trade association, stated that the VOC

content limits for interior and exterior nonflat alkyd trim paint

and many other coatings are as low as they can go without

adversely affecting performance.

Response: The EPA has decided to retain the proposed VOC

content limit at 380 g/l for both solventborne and waterborne

nonflat interior coatings. Approximately 84 percent of the total

nonflat coatings sales in the 1990 VOC Emission Inventory Survey

met this limit, and approximately 40 percent of the solventborne

nonflat coatings surveyed were at or below this limit. Also, a

review of existing State architectural coating rules showed only

one State (Texas) with a VOC content limit higher than the
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proposed limit of 380 g/l for this category. Support for the

proposed limit was provided by several of the commenters

mentioned above as well as by a preproposal commenter (II-D-10)

who specified that 350 g/l would allow superior alkyd semi-gloss

coatings. In addition, according to a recent study on the

performance of nonflat coatings (IV-B-4), a VOC-free multiphase

latex gloss enamel was compared to several commercially available

conventional VOC latex gloss enamels, and it achieved gloss and

block resistance equal to or better than conventional coatings.

Multi-colored coatings.

Comment: One commenter (IV-D-191) argued that the VOC

content limit proposed for multi-colored coatings (580 g/l) is

too high. The commenter suggested lower limits of 150 g/l for

1997 and 0 g/l for 2000 for this category. The commenter cited

the November 8, 1996, California-South Coast proposed limit of

420 g/l for this category as additional support for his claim

that the EPA’s proposed limit is too lenient. The commenter

believes the proposed national standard is too lenient because

one manufacturer with 70 percent of the Southern California

market already sells multi-colored coatings that meet the 150 g/l

standard. The commenter did not provide any basis for the

suggested 0 g/l level for 2000 for this category.

Response: The EPA has decided to retain the VOC content

limit of 580 g/l for multi-colored coatings based on existing

State architectural coating rules and available survey data on

the VOC content of multi-colored coatings. A review of existing

State regulations revealed limits on VOC content ranging from

250 g/l (California-South Coast rule effective January 1, 1998)

to 600 g/l (Kentucky, New York, New Jersey, Massachusetts, and

Rhode Island regulations). Thus, the EPA has concluded that the

580 g/l limit is appropriate for the range of conditions covered

by the national rule. Lower limits may be appropriate for local

areas that must achieve a different balance of considerations for

determining VOC controls than for a rule that applies nationwide.
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Nuclear coatings category.

Comment: Four commenters (IV-D-18, IV-D-151/IV-F-2g,

IV-D-162, IV-D-189) suggested that a higher VOC content limit is

needed for the nuclear coating category. Three commenters

(IV-D-18, IV-D-162, IV-D-189) specifically recommended raising

the VOC content limit for nuclear coatings from 400 g/l to

450 g/l. Two commenters (IV-D-18, IV-D-151/IV-F-2g) pointed out

that having the nuclear coating limit more stringent than for

industrial maintenance coatings is illogical since coatings used

at nuclear facilities are subject to specific rigorous

requirements for use at nuclear facilities. One commenter

(IV-D-189) argued that the only justification the EPA provided in

the proposal preamble for the nuclear coating category VOC

content limit was that it was consistent with the nuclear

category in the Shipbuilding and Ship Repair NESHAP. The

commenter stated that the VOC limits for nuclear coatings in the

Shipbuilding and Ship Repair (Surface Coating) Operations NESHAP

were lower than levels that had been identified by the coatings

industry as necessary for adequate application and use as

architectural coatings. The commenter argued that it was

inappropriate to apply the VOC content limits of the Shipbulding

and Repair NESHAP to architectural coatings without recognizing

the significant differences between the two end uses: (1) a

field-applied coating has to be capable of application in a

variety of different settings which cannot be planned for, as

opposed to shipbuilding and ship repair coatings applied at fixed

facilities under generally controlled conditions, and (2) the

Shipbuilding and Ship Repair NESHAP provides VOC content

flexibility (i.e., a thinning exemption) for coatings applied in

cold weather. In comparison, the proposed architectural coatings

rule offered no flexibility for cold weather thinning for

field-applied coatings. Thus, the commenter recommended

increasing the VOC content limit for nuclear coatings to 450 g/l.

At the public hearing, one commenter (IV-D-151/IV-F-2g)

requested that coatings used in Level 1 containment areas be

exempt from the rule or be subject to a higher limit.
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Specifically, the company’s nuclear enamel coating at a VOC

content of 540 g/l does not meet the proposed limit for nuclear

coatings. The commenter (IV-D-151/IV-F-2g) suggested the

following subcategories and VOC content limits for nuclear

coatings: (1) concrete curing compounds (660 g/l); (2)

primers/surfacers (420 g/l); and (3) finish coatings (540 g/l). 

The commenter claimed that these VOC content limits are based on

existing coatings already approved for use in nuclear facilities

for Level I and Level II use. Based on the EPA proposal, the

commenter explained that they would have to reformulate, retest,

and recertify their nuclear products. According to the

commenter, testing would cost more than $30,000 per reformulation

and require 6-8 months. The commenter (IV-D-151) stated that the

company’s nuclear coatings have been tested in accordance with

required specifications ANSI N101.2 and N5.12 for use in nuclear

plants and that the product must be manufactured in compliance

with a quality assurance program that complies with appendix B,

10 CFR 50 and 10 CFR 21. Each shipment must be accompanied by a

Certificate of Analysis assuring the coating has the same

characteristics as original batches. In addition to the testing,

the commenter (IV-D-151) mentioned that their customers must

submit a 10 CFR 5059 review to the Nuclear Regulatory Commission

(NRC) in order to modify their license and that submittal is a

long and costly process. As an alternative to reformulation, the

commenter (IV-D-151/IV-F-2g) suggested the low-volume exemption

or exceedance fee. The commenter calculated that the exceedance

fee would increase the current cost of their $75 per gallon

coatings by about $0.40 per gallon (IV-F-2g) or $0.50 per gallon

(IV-D-151).

Response: The EPA agrees that the nuclear coatings category

VOC content limit should not be more stringent than the limit for

industrial maintenance coatings because nuclear coatings are

subject to some of the same extreme environmental conditions as

industrial maintenance coatings as well as other rigorous

requirements. Also, as pointed out by the commenters, nuclear

coatings must meet further specifications of the NRC. For these
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reasons, the EPA concurs that a higher VOC content limit is

justified. Thus, the EPA has decided to raise the VOC content

limit for nuclear coatings to 450 g/l which is the same as the

level prescribed for industrial maintenance coatings and also

provides allowance for extra thinning during cold weather

conditions. The EPA expects that a limited amount of nuclear

coatings will be affected by this change due to the various

testing requirements and limited number of nuclear facilities. 

Also, as pointed out in the proposal preamble (61 FR 32739), this

is one of 17 specialty coating categories that did not appear in

existing State architectural coating rules, and no data were

collected in the 1990 VOC Emissions Inventory Survey.

In addition, the EPA has considered the suggestion to

subcategorize the nuclear coating category into three

subcategories with different VOC content limits: concrete curing

compounds (660 g/l), primers/surfacers (420 g/l), and finish

coatings (540 g/l). The nuclear coatings category is intended to

include coatings manufactured specifically for use at nuclear

facilities to ensure operational safety and the definition

requires that these coatings meet various requirements. 

Therefore, if these coatings meet the nuclear coating category

definition, they would be classified as nuclear coatings under

this rule and subject to the VOC content limit of 450 g/l. 

Therefore, the EPA does not believe it is necessary or

appropriate to subcategorize the nuclear coating category with

different limits as suggested. The final rule includes a tonnage

exemption and exceedance fee option for additional compliance

flexibility if needed. 

Nonferrous ornamental metal lacquers and surface

protectants.

Comment: One commenter (IV-D-31) contended that it is

necessary to retain the proposed VOC content limit for nonferrous

ornamental metal lacquers and surface protectants. The commenter

argued that none of the lower VOC coatings that have been tested

demonstrate the essential performance characteristics for this
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category such as fast drying time, easy removal, and prevention

of oxidation, corrosion, and surface degradation. 

Response: The EPA has retained the proposed VOC content

limit of 870 g/l for nonferrous ornamental metal lacquers and

surface protectants in the final rule. The EPA’s review of

existing State architectural coating rules and information

provided by commenters indicates that this limit is appropriate. 

Opaque stains.

Comment: Three commenters (IV-D-45, IV-D-93, IV-F-2)

asserted that opaque stains that are thin flat oil paints with

wood preservative chemicals could not be made to meet the

proposed VOC content limit of 350 g/l. Another commenter

(IV-F-2) requested that the limit for opaque stains be raised to

450 g/l. One commenter (IV-D-45) said that acrylic flat latex

paints can replace lighter colored stains with better color

retention but have limited application in cold weather. However,

this commenter asserted that darker stains needed for

outbuildings, fences, decks, and picnic tables cannot be produced

at the 350 g/l VOC content level. The commenter’s company

produced less than 6,000 gallons of opaque stains in 1995. 

Another commenter (IV-D-93) asserted that reformulation would

result in uneven sheen over the variety of substrate conditions

found on stained buildings and that oil-based stains are still

needed for older weathered surfaces. The commenter argued that

the lowest practical VOC content for opaque stains would be

425 g/l. This commenter produced 7,950 gallons of opaque stains

in 1995 and 5,000 gallons through August 1996. Another commenter

(IV-F-2) stated that opaque stains with a VOC content of 350 g/l

have drying problems and too much film build. Raising the solids

content defeats the purpose of the stain (i.e., penetration

without coating the surface), and waterborne products do not

perform well. The commenter stated that the complaint rate for

their waterborne stains is much higher than for their

solventborne stains.

On the other hand, another commenter (IV-D-185) maintained

that the proposed limits for stains are technologically and
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economically feasible to achieve and yield significant emission

reductions. 

Response: The EPA has not revised the 350 g/l VOC content

limit for opaque stains for the following reasons. The 1990 VOC

Emissions Inventory Survey showed that over 14 percent of

solventborne opaque stains were manufactured with VOC contents at

or below 350 g/l, and all of the waterborne coatings, which

represent 46 percent of the total sales from this category, were

below 200 g/l. Therefore, 60 percent of all coatings being

manufactured are compliant. Also, except for one county in

California, the State architectural coating rules reviewed,

including Arizona, California, Kentucky, Massachusetts,

New Jersey, New York, and Rhode Island, have had a VOC content

limit of 350 g/l for opaque stains for several years over a wide

range of conditions. The EPA thus believes that because a

significant portion of the products in this category already meet

the proposed limit, it is appropriate to maintain the limit. The

prevalence of products that meet the limit and the selection of

this limit by States indicates that the it is technologically and

economically feasible. The commenters producing low volumes of

stains that are not compliant may want to consider the tonnage

exemption and exceedance fee provisions. 

Stains - clear and semi-transparent.

Comment: Four commenters (IV-D-45, IV-D-93, IV-D-175,

IV-F-2) stated that clear and semi-transparent stains have poor

performance at the proposed 550 g/l VOC content limit. One

commenter (IV-D-45) indicated that high solids stain formulations

meet the VOC requirements but result in a higher rate of consumer

complaints for lap marks and shiny spots. Furthermore, the

commenters claimed that acrylic latex paint does not penetrate

wood, penetrate the color white, or allow application of a very

thin film which would prevent peeling. One commenter (IV-D-93)

indicated that it has an interior wood stain that will have to be

discontinued because it cannot meet the 550 g/l limit, thus

leading to lost sales in related products such as varnishes and

lacquers. The commenter stated that based on early
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investigations there seems to be no way to reformulate this core

product to meet the 550 g/l limit and maintain the performance

properties of the product. Additionally, the commenter reported

that it produced 6,645 gallons of this interior wood stain in

1995 and 3,965 gallons through August of 1996.

Another commenter (IV-D-175) stated that waterborne stain

systems cannot replace certain solventborne products. The

commenter explained that the company had poor results when

replacing solventborne interior wood stains and varnishes with

waterborne products. The company manufactures over

10,000 gallons of these products per year.

One commenter (IV-F-O1h) that manufactures stains,

varnishes, lacquers, and wood preservatives stated that

reformulation would result in flow problems during spray

application. The commenter explained that they sell products to

furniture makers and cabinet shops.

One commenter (IV-F-2) stated that stains with a VOC content

of 500 g/l look great in laboratory tests, but consumers tend to

double coat the product, resulting in “shiners” in the siding or

flashing. They requested that the EPA raise the limit to 650 or

700 g/l.

Another commenter (IV-F-2) stated that the company cannot

meet the proposed VOC content limit of 550 g/l, but offered no

basis for this statement.

Response: The EPA has retained the VOC content limit of

550 g/l for clear and semi-transparent stains. In reviewing the

VOC content survey data, the EPA noted that there are several

peaks in the 1990 VOC Emissions Inventory Survey sales data for

solventborne semi-transparent stains, which include interior and

exterior stains: 301 to 350 g/l, 501 to 550 g/l, and 601 to

700 g/l VOC content. The highest percentage of coating sales

(21.5 percent) in the survey for these stains was in the 501 to

550 g/l range. Nearly all of the State architectural coating

rules the EPA reviewed have a VOC content limit of 550 g/l for

this category, except California-South Coast, which has a limit

of 350 g/l. Thus, products complying with the 550 g/l limit are
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being used across the country. The prevalence of products that

comply with this limit indicates that it is technologically and

economically feasible. 

Although one commenter mentions products sold to furniture

makers and cabinet shops, it is important to note that coatings

applied in shop settings, such as these applications, are not

subject to the rule. As stated at the beginning of this section,

the definition of “architectural coating” has been amended to

specifically exclude shop-applied coatings because they were not

intended to be covered.

Pretreatment wash primers.

Comment: One commenter (IV-D-162) noted that the proposed

VOC content limit of 780 g/l for pretreatment wash primers is

consistent with the Shipbuilding and Ship Repair NESHAP and then

revealed that their data shows most products are formulated at

less than a 650 g/l VOC content, implying that lower-VOC content

coatings are available.

Response: The EPA has retained the VOC content limit of

780 g/l for pretreatment wash primers. In follow-up information

(IV-E-Liston), the commenter did not provide the requested VOC

content data to support the assertion that most products are

produced at 650 g/l. Also, there are no known State

architectural coating rules with a VOC content limit below

780 g/l for these products. In addition, the commenter is

correct that the limit of 780 g/l for pretreatment wash primers

in the architectural coating rule is consistent with the final

Shipbuilding and Ship Repair NESHAP (60 FR 64330;

December 15, 1995) and the final Control Techniques Guidelines

(CTG) published on August 27, 1996 (61 FR 44050). A similar

coating is used in both industries. 

Quick-dry primers, sealers, and undercoaters.

Comment: Five commenters (IV-D-30, IV-D-43, IV-D-44,

IV-D-46, IV-D-182) provided comments on quick-dry primers,

sealers, and undercoaters. Two commenters (IV-D-30, IV-D-43)

indicated that a lower VOC content limit of 350 g/l (proposed

450 g/l) for quick-dry primers, sealers, and undercoaters can be
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achieved by existing technology and products. Two commenters

(IV-D-44, IV-D-182) argued that the proposed VOC content limit

for quick-dry primers, sealers, and undercoaters was too

stringent and would affect performance or eliminate these

products. Specifically, these commenters cited increased drying

time, poor leveling properties, and poor durability. These

commenters did not provide any support for this claim or

recommend an alternative limit.

One commenter (IV-D-43) referred to effective 350 g/l

solventborne coatings that are higher in solids and slightly more

costly than current options. The commenter presented their own

products as market evidence that a 350 g/l VOC content limit for

quick-dry primers, sealers, and undercoaters is attainable. 

One commenter (IV-D-46) requested that a white pigmented

sealer-primer-stainblocker called "Kilz" be classified under the

quick-dry primers, sealers, and undercoaters category with a VOC

content limit of 450 g/l. According to the commenter, this

product has been marketed as a quick drying product since its

inception. Specifically, it meets the American Society for

Testing and Materials (ASTM) specification D1640 for drying to

touch in one-half hour and can be recoated in two hours. This

commenter indicated that the product complies with a 450 g/l

limit for this category in the State architectural coating rules

adopted by Kentucky, Oregon, and Washington within the last year.

Response: The EPA has retained the 450 g/l VOC content

limit for quick-dry primers, sealers, and undercoaters based on

consideration of survey data and State architectural coating rule

requirements. Three of the commenters argued that a VOC content

limit of 350 g/l or below is achievable with existing technology. 

However, based on the 1990 VOC Emissions Inventory Survey, the

EPA notes that 81 percent of these coatings had VOC contents

between 451 and 500 g/l. Only 5 percent of quick-dry primers,

sealers, and undercoaters were manufactured with VOC contents at

or below 350 g/l. In addition, as noted by one of the commenters

(IV-D-46), several State architectural coating rules have a VOC

content limit of 450 g/l; Massachusetts has a limit of 500 g/l. 
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Thus, reduction of the VOC content limit is not appropriate. 

Similarly, the EPA notes that the prevalence of products that can

meet the limit and the existence of similar State limits confirms

that the proposed limit should not be raised. Those

manufacturers or importers whose products are above the limit may

take advantage of the tonnage exemption and the exceedance fee.

In regard to the request that a white pigmented

sealer-primer-stainblocker called “Kilz” be classified under the

quick-dry primer, sealer, and undercoater category, the EPA

agrees that as described by the commenter, this coating meets the

definition for this category and would be subject to the VOC

content limit of 450 g/l.

Quick-dry enamels.

Comment: Two commenters (IV-D-44, IV-D-182) argued that the

VOC content limit of 450 g/l for quick-dry enamels was too harsh

and would affect performance or may eliminate these coatings. 

Specifically, the commenters cited increased drying time, poor

leveling, and poor durability as characteristics of low VOC

quick-dry enamels. The commenters did not currently have

documentation to support this claim.

Response: The EPA has retained the 450 g/l VOC content

limit for quick-dry enamels based on consideration of survey data

and State architectural rule requirements. The 1990 VOC Emission

Inventory Survey shows that 46 percent of solventborne coating

sales are at or below a VOC content of 450 g/l. In addition,

several State architectural coating rules are at or below 450 g/l

VOC for quick-dry enamels: Arizona, Oregon, and California (Bay

Area, Sacramento, South Coast, and the counties of Colusa, El

Dorado, and Feather). The EPA believes that this confirms that

coatings of this type are technologically and economically

feasible at the proposed limit.

Waterproofing sealers and treatments.

Comment: Nine commenters (IV-D-74, IV-D-80, IV-D-114,

IV-D-158, IV-D-185, IV-D-208, IV-F-2 (three commenters) provided

assessments of the achievability of the proposed VOC content

limit for waterproofing sealers and treatments. Four commenters
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(IV-D-80, IV-D-158, IV-F-2 (two commenters)) suggested that the

EPA raise the VOC content limit and two commenters (IV-D-114,

IV-D-208) suggested that the EPA lower the limit. One commenter

(IV-D-158) proposed a limit of 700 g/l for all waterproofing

sealers and explained that this would still require reformulation

of existing technologies yet would allow higher performance

solventborne systems. This commenter explained that a large

volume of waterproofing sealers are used on concrete structures

to prevent substances from penetrating the concrete and causing

corrosion around the imbedded steel. This commenter argued that

there are several disadvantages of low-VOC (silane and siloxane)

waterproofing sealers that use water as a reactive diluent: 

reduced depth of penetration on dense substrates, field mixing,

limited shelf life, and increased application frequency. In

addition, the commenter maintained that there was no need to

distinguish between clear and opaque waterproofing sealers and

treatments (600 g/l and 400 g/l, respectively) since many opaque

sealers penetrate the substrate and perform the same objective as

clear sealers. Another commenter (IV-D-74) manufactures less

than 1,000 gallons annually of a waterproofing sealer with a VOC

content of 750 g/l. This commenter also produces a waterborne

product, but it is reportedly not as effective as the

solventborne product because it does not last as long.

One commenter (IV-F-2) argued that manufacturing a

waterproofing sealer with a VOC content of 600 g/l is not

possible. This commenter reportedly has spent several hundred

thousand dollars trying to develop a waterborne waterproofing

sealer and was not successful. The commenter asserted that a

high-solids product will not work because a coating with too much

solids builds a film on the wood. Another commenter (IV-F-2)

tried to develop a low-VOC sealer but it had mildew problems. 

One commenter (IV-F-2) manufactures waterproofing sealers in the

700 g/l VOC content range, but it cannot meet the 600 g/l limit.

One commenter (IV-D-80) suggested a higher VOC content limit

of 700 g/l for water repellent products for 2 to 3 years to allow

protection of architectural structures while completing
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development and testing of low-VOC waterborne products. The

commenter elaborated on long-term testing requirements for new

water repellents: testing typically takes 2 to 3 years for the

Department of Transportation (DOT) market, formulators for the

do-it-yourself market require a minimum of 1-year exposure data,

and parameters in commercial markets require track records that

may take years to establish. The commenter reportedly has

invested significant research and development resources in lowerVOC technology.

On the other hand, one manufacturer (IV-D-185) maintained

that the VOC content limits proposed for waterproofing sealers

are technologically and economically feasible to achieve.

One commenter (IV-D-208) strongly encouraged the EPA to

adopt a VOC content limit applicable to waterproofing sealers and

treatments, both clear and opaque, of 350 g/l rather than the

proposed limits of 600 and 400 g/l, for clear and opaque,

respectively. The commenter does not believe the proposed limits

for waterproofing sealers and treatments go far enough to push

replacement of obsolete petroleum distillate-based technologies

with low-VOC alternatives already in national production and

distribution. The commenter referred to their clear

waterproofing sealer and treatment with a VOC content of less

than 160 g/l that is currently in the consumer marketplace. 

According to the commenter, any concern expressed about the

January 1, 1998 timing to implement new technologies to comply

with a 350 g/l VOC content limit for waterproofing sealers and

treatments is inconsistent with the coatings which meet this

proposed limit and are currently available in most home center

stores and mass merchants throughout the country. Another

commenter (IV-D-114) manufactures a high performance

waterproofing sealer with extremely low emissions (<100 g/l) as

an alternative to solvent-based pigmented waterproof coatings

which typically emit 400 g/l.

Response: Based on evaluation of the comments and a review

of survey data and State architectural coating regulations, the

EPA has combined the clear and opaque waterproofing treatment
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sealer categories into one category with a VOC content limit of

600 g/l. After review and evaluation of the comments, the EPA

agrees that there is no need to distinguish between clear and

opaque waterproofing sealers and treatments since many opaque

sealers penetrate the substrate and perform the same function as

clear sealers. Furthermore, before proposal, industry

representatives (II-D-188) argued that multipurpose waterproofing

sealers with a VOC content of 400 g/l do not meet minimum

performance criteria for clear waterproofing sealers (that is,

60 percent water repellency for wood and 1 percent or less water

absorption for brick). The representatives argued that most of

the multipurpose waterproofing sealers at 400 g/l VOC content are

high solids coatings that leave an oily residue or cause

darkening of the surfaces to which they are applied. This change

is consistent with existing State architectural coating rules and

survey data, which do not divide the category into clear and

opaque waterproofing sealers and treatments. The State limits

reviewed for waterproofing sealers and treatments are either

400 g/l (for example, California and Arizona) or 600 g/l

(Massachusetts, Kentucky, New Jersey, New York, and Rhode

Island). Thus, the EPA believes that setting the VOC content

limit at the higher end of the range (600 g/l) represented in the

State rules will provide the flexibility to ensure that

performance requirements for this entire category will be met on

a nationwide basis, although there may be individual coatings

that can achieve lower limits for some applications. If

additional time is needed to test low-VOC waterborne coatings,

the final rule offers compliance flexibility through the

exceedance fee and tonnage exemption provisions.

Shellac - clear.

Comment: Two commenters from the same company (IV-D-42,

IV-F-1s) requested that the VOC content limit for clear shellac

be raised from 650 g/l to 730 g/l. The commenter (IV-D-42)

explained that the proposed rule would not change the product as

sold (i.e., the coating is below 650 g/l as sold), but would

instead require that the thinning instructions be taken off the
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1 gallon and 5 gallon packages. The commenter believed that

lowering the VOC contents and removing thinning instructions

would result in less informed consumers because thinning is

advantageous in a variety of applications. 

Response: Based on a review of State architectural coating

rule requirements, the EPA has raised the VOC content limit for

clear shellac from 650 g/l to 730 g/l to include thinning

considerations. All of the State rules reviewed have a VOC

content limit of 730 g/l for clear shellac. The use of shellac

is not expected to increase in the future and, therefore, this

change is not likely to result in a significant emissions

increase. According to information provided by the commenter in

a separate comment letter (IV-D-25), the elevated cost and

limited availability of shellac (referring to secretions of the

lac beetle) minimizes the potential use for this category of

product as a fast dry prime coat, general purpose primer and

clear wood finish. Certain applications of shellac require

thinning to meet customer needs. Therefore, in order to satisfy

the performance requirements and consistent with State rules, the

EPA maintains that the higher limit of 730 g/l for clear shellac,

which allows for thinning, appropriately reflects achievable

levels. 

Wood preservatives - clear and semi-transparent.

Comment: One commenter (IV-D-93) argued that 600 g/l is the

lowest practical VOC content limit for clear and semi-transparent

wood preservatives. The commenter explained that these products

are designed to penetrate rather than leave a film on the

surface. The commenter noted that the company’s coatings are

formulated with a VOC content of 620 g/l and they still get

complaints about residue on the surface. The commenter added

that their small company had produced 1,967 gallons of clear and

semi-transparent wood preservatives in 1995 and 1,729 through

August of 1996, and that they would have to discontinue

production since they cannot meet the proposed VOC content limit

of 550 g/l for these products.
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One commenter (IV-F-O1h) that manufacturers wood

preservatives and other coatings stated that reformulation would

result in flow problems during spray application. The commenter

explained that they sell coatings to furniture makers and cabinet

shops. 

Response: As discussed elsewhere in this document, shopapplied coatings are not subject to the rule. The definition of

architectural coating specifically excludes coatings recommended

solely for shop application. The EPA has considered these

comments and has decided to retain the VOC content limit of

550 g/l for this category based on a review of State

architectural coating regulations. A review of several State

architectural coating rules revealed that several States

(Kentucky, Massachusetts, New Jersey, New York, and Rhode Island)

have a 550 g/l limit, while other States (California, except one

county, and Arizona) have a more stringent VOC content limit of

350 g/l for clear and semi-transparent wood preservatives. Thus,

the EPA believes that the State rules provide evidence that the

550 g/l VOC content limit is achievable and performance needs are

being met. Since the commenter manufactures low volumes of these

coatings, the tonnage exemption or exceedance fee should be

considered as compliance alternatives. 

Swimming pool coatings.

Comment: One commenter (IV-D-189), representing a national

trade association, requested that the EPA recognize a special

thinning requirement for swimming pool coatings (the proposed VOC

content limit was 600 g/l). The commenter asserted that the

first coat applied to bare concrete requires a VOC content of

850 g/l in order to ensure adequate penetration of the initial

coating into the concrete surface.

Response: The EPA disagrees that it is necessary to allow

for special thinning for swimming pool coatings. In the 1990 VOC

Emission Inventory Survey, 93 percent of total swimming pool

coating sales were for solventborne coatings ranging from 501 to

600 g/l VOC content, as applied, which included maximum thinning. 

Some existing State architectural coating rules reviewed
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(Massachusetts, New Jersey, and New York) have a VOC content

limit of 600 g/l; Kentucky and California have a limit of

650 g/l. In addition, the EPA is not aware of any State rules

that allow a special thinning requirement for the initial coating

of the pool’s surface. Therefore, the EPA has not made any

change in the VOC content limit for the swimming pool coating

category to allow for special thinning.

Varnishes.

Comment: One commenter (IV-D-173), a small manufacturer,

requested a higher VOC content limit for varnishes (proposed at

450 g/l), but did not request a specific limit. The commenter

argued that these coatings have solids of 30 to 40 percent and

would be extremely difficult to make above 60 percent. The

commenter also argued that this is a low-volume product for its

company. The commenter maintained that waterborne varnishes are

not good enough for exterior use because they lift up under wet

conditions. The commenter elaborated that these coatings are

applied outside on wood structures, boats, and floors.

One commenter (IV-D-175) stated that its company had poor

results when attempting to replace solventborne varnishes with

waterborne systems. Another commenter (IV-D-73) stated that its

varnishes do not meet the proposed VOC content limit for

varnishes, but the commenter did not provide any basis for this

statement.

One commenter (IV-F-O1h) that manufactures varnishes as well

as stains, lacquers, and wood preservatives, stated that

reformulation would result in flow problems during spray

application. The commenter explained that it sells coatings to

furniture makers and cabinet shops. 

On the other hand, one manufacturer (IV-D-185) maintained

that the proposed VOC content limit of 450 g/l for varnishes was

technologically and economically feasible to achieve. In

addition, several manufacturers (IV-D-69, IV-D-85, IV-D-185,

IV-D-207) have argued that the 450 g/l VOC content limit for

varnishes is achievable. 
2-220

Response: The architectural coating rule does not apply to

the coating of non-stationary structures such as boats or to

coatings recommended solely for shop application. The definition

of “architectural coating” has been revised to exclude more

explicitly shop-applied coatings and coatings applied to nonstationary structures, such as airplanes, ships, boats, and

railcars, because they were not intended to be covered. The EPA

has evaluated these comments and decided to retain the VOC

content limit of 450 g/l for varnishes based on a review of State

architectural coating regulations, available survey data, and

other comments that argue that the proposed limit is achievable. 

Several existing State architectural coating rules (Kentucky,

Massachusetts, New Jersey, New York, and Rhode Island) have a VOC

content limit of 450 g/l for varnishes, other rules (Arizona and

California, except 1 county) have a more stringent limit of

350 g/l; and one rule (Texas) has a higher limit of 540 g/l. 

This review indicates that compliant varnishes meeting

performance needs are currently being sold in many areas of the

country. Also, the 1990 VOC Emission Inventory Survey showed

that 30 percent of the sales for varnishes had VOC contents at or

below 450 g/l.

Floor coatings.

One commenter (IV-D-93) requested clarification of whether

the floor coating category included clear floor finishes or paint

(opaque) or both. The commenter argued that only paints could

comply with the proposed VOC content limit of 400 g/l. 

Another commenter (IV-D-180) suggested that floor coatings

either be classified under industrial maintenance coatings

(450 g/l) or have their VOC content limit raised to 450 g/l. The

commenter manufactures coatings used exclusively on concrete or

wood floors and believes that these high performance floor

coatings are better covered by the 450 g/l VOC content limit

proposed for industrial maintenance coatings, rather than the

lower-VOC content limit of 400 g/l proposed for floor coatings. 

The commenter stated that the company has developed coatings in

the 400 to 450 g/l range to replace most of their very high VOC
2-221

industrial floor coatings. Although they have lower performing

systems that meet the 400 g/l level, like industrial maintenance

coatings, they are not always acceptable for all applications. 

The commenter provided several examples where it claimed that low

VOC products cannot be successfully applied. The commenter

concluded that there are still applications that require coatings

in the 400 to 450 g/l range and for some very high chemical

resistant applications the systems are above 500 g/l, regardless

of the advances made in low VOC coatings.

One commenter (IV-D-169) recommended that opaque floor paint

be regulated at a VOC limit of 400 g/l. 

Response: The EPA has retained the floor coating category

and VOC content limit of 400 g/l. The floor coatings category is

intended to include coatings that have a high degree of abrasion

resistance that are formulated for application to flooring

including, but not limited to, decks, porches, and steps in a

residential situation. Industrial maintenance coatings

recommended for use as floor coatings in industrial, commercial,

or institutional settings are subject to the industrial

maintenance coatings category and its VOC content limit of

450 g/l. The classification of opaque floor coatings would be

included in the floor coatings category and subject to the

400 g/l limit, which two commenters agreed is achievable. For

clarification, the word “opaque” has been added to the floor

coating definition and has been defined in the final rule. 

However, varnishes or industrial maintenance coatings that are

recommended for use as floor coatings outside of a residential

setting are subject to the VOC content limit of 450 g/l for

varnishes or industrial maintenance coatings (see discussion

under Overlap Issues, in section 2.2.3.14 of this document). 

Lacquers.

Comment: Two commenters (IV-D-32, IV-D-191) provided

comments on the lacquers category. One commenter (IV-D-32)

maintained that the lacquers category has a relatively high

proposed VOC content limit of 680 g/l which may provide incentive

for painters currently using a lower-VOC alkyd coating to switch
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to the higher-VOC lacquer category. This commenter found

evidence of this migration in their State (Oregon), which

included the same category in its rule. The commenter

recommended closer investigation of this category after

promulgation of the rule. If significant growth is seen in this

category, the commenter recommended that it be removed from the

rule.

Another commenter (IV-D-191) indicated that the proposed VOC

content limit for lacquers (680 g/l) should be lowered (i.e.,

made more stringent) to 275 g/l for 1997 and 50 g/l for the

year 2000. The commenter explained that the proposed VOC content

limit of 680 g/l is currently in place in Southern California and

that more stringent VOC content limits of 550 g/l for 1998 and

275 g/l for the year 2005 are planned. The commenter argued that

because there are five lacquers on the market that have VOC

contents less than 50 g/l, the EPA’s limit for lacquers is not

stringent enough. 

Response: The EPA has considered these comments and

maintains that the lacquers VOC content limit of 680 g/l is

appropriate for the following reasons. The 1990 VOC Inventory

Survey showed that 75 percent of solventborne coating sales were

in the 651 to 700 g/l VOC content range. All of the existing

State architectural coating regulations currently have a VOC

content limit of 680 g/l for lacquers, except California-South

Coast and one county in California. According to information

received from the industry (III-B-1), reformulation of lacquers

may adversely affect performance characteristics such as drying

time and film hardness. The EPA recognizes that some progress

has been made to reduce the VOC content of these coatings and

that other types of coatings may be able to serve the customers’

application needs. However, the EPA believes that a VOC content

limit of 680 g/l is necessary to satisfy performance needs for

lacquer applications nationwide as evidenced by the State

architectural coating rules.
2-223

Form release compounds and high temperature coatings.

Comment: Three commenters (IV-D-05, IV-D-30, IV-G-01)

commented on the achievability of the proposed VOC content limit

of 450 g/l for the form release compound category. Two

commenters (IV-D-05, IV-D-30) argued that although technology

exists for coatings to comply with the proposed limit for this

category, it is double the cost of the conventional product. 

Another commenter (IV-D-05) also expressed concerns about the

performance of coatings reformulated to meet the proposed limit. 

According to the commenter, the best performing coatings have VOC

contents between 550 and 750 g/l and provide greater coverage in

a thin coat. Thin coat applications allow the user to get the

concrete loose from the form. According to the commenter, lowerVOC coatings demonstrate a higher viscosity that results in a

decrease in coverage rate. Also, this commenter argued that

lower VOC coatings are not able to achieve the release of the

concrete form without applying a thicker film to the form. Both

commenters (IV-D-05, IV-D-30) argued that coatings under the

450 g/l VOC content level increase user costs due to increases in

the quantity applied and in associated cleaning costs. In

addition, both commenters (IV-D-5, IV-D-30) estimate that the raw

materials for the low-VOC formulation (450 g/l) will cost

80 cents more per gallon, which is significant in the concrete

industry. Both commenters believe that the combination of

increased raw material cost and the decrease in coverage rate (at

the 450 g/l limit) will double the price for the consumer. 

Commenter IV-D-30 stated that waterborne formulas perform poorly

and have a short shelf-life. Also, in order to cut costs, the

commenter suggested that concrete producers may thin the lower

VOC compounds in the field with diesel fuel or mineral spirits in

order to make a higher VOC content coating that works better,

thereby costing this commenter sales (about $200,000 per year)

because the commenter’s company cannot make and sell the higher

VOC content coatings. 

On the other hand, one commenter (IV-G-01), a coating

manufacturer, recommended that the EPA tighten the proposed limit
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of 450 g/l for form release compounds to 250 g/l, which the

commenter stated is California-CARB's VOC content limit for this

category. The commenter believes it would help prevent confusion

and lower costs if there is one VOC content limit for the whole

country. The commenter stated that although its lower VOC

coatings sell for about twice the price per gallon of the cheaper

higher VOC content form release compounds, when the lower VOC

coatings are properly applied, the cost per square foot is about

20 percent of the cost of diesel oil-based products (870 g/l). 

According to the commenter, the cost savings is due to using less

of the lower VOC coating when properly applied.

One commenter (IV-D-226), representing a small business,

asserted that there was no legitimate technical or economic

reason for the proposed high-temperature coating VOC content

limit to be set above 420 g/l (a limit of 650 g/l was proposed). 

All of the company’s high temperature coatings, used in the

refining, petrochemical, cogeneration, primary metal, pulp and

paper, and utility industries, have complied with the proposed

650 g/l limit for the last 25 years. The commenter noted that a

number of other recognized companies also manufacture a wide

variety of low VOC high temperature coatings that meet a limit of

420 g/l. The commenter asserted that reformulation costs should

not be the basis for establishing a limit higher than 420 g/l for

this coatings category and cited his own company as an example of

one of the smallest coating manufacturers in the country who is

successfully incurring reformulation costs. The commenter added

that a VOC content limit of 420 g/l was consistent with State and

regional regulations, and the commenter supported the limit of

420 g/l for high temperature coatings proposed by STAPPA/ALAPCO. 

The commenter suggested the use of the proposed variance

procedure for any company in need of additional compliance time

for this category in lieu of undermining the gains already made

in emission reductions at the regional and local levels for this

category.

Response: The EPA has retained the VOC content limit of

450 g/l for form release compounds and 650 g/l for high-
2-225

temperature coatings. As stated in the proposal preamble

(61 FR 32739), VOC content limits for 14 low volume categories,

including form release compounds and high-temperature coatings,

are found in existing State architectural coating rules. The

proposed VOC content limits for these categories are in the upper

range of the VOC content limits found in existing State rules. 

During regulatory negotiations, the industry argued that these

coatings are used in relatively low volumes and represent unique

compositions and specialized uses, and the imposition of lower

VOC content limits on these categories would probably result in

an adverse economic impact. Even though lower VOC technology is

available in some cases, the EPA believes that there is not

enough performance information and sales data to conclude that

the suggested lower VOC levels are appropriate for these coatings

on a nationwide basis. 

Bond breakers.

Comment: One commenter (IV-G-14) requested that the bond

breaker category VOC content limit be set at 700 g/l (a limit of

600 g/l was proposed) for the following reasons: (1) the

original specifications recognized the need to allow a higher VOC

content for bond breakers than for concrete curing and sealing;

(2) a bond breaker is actually used as a curing compound in the

first coat operation; (3) bond breaker costs are applied at an

extended coverage rate; and (4) a coating with a VOC content of

600 g/l is extremely difficult to work with in cold temperatures.

Response: The EPA has retained the VOC content limit of

600 g/l for the bond breakers category. As indicated in the

previous response, the EPA proposed 14 low volume categories,

including bond breakers. These coatings are found in existing

State architectural coating rules, and the proposed VOC content

limits for these categories are in the upper range of the VOC

content limits found in existing State rules. During the

regulatory negotiation, the industry argued that these coatings

are used in relatively low volumes and represent specialized

uses. The commenter did not provide any information to support

consideration of a higher VOC content limit for this category. 
2-226

In addition, a review of the existing State architectural coating

rules showed that none of these rules have a VOC content limit

above 600 g/l for bond breakers. Thus, the EPA believes that the

600 g/l limit for bond breakers is appropriate for this category.

Concrete protective coating.

Comment: One commenter (IV-D-76) manufactures a

concrete/seal finish that, according to the commenter, could be

classified as a concrete protective coating or extreme high

durability coating. The commenter wanted to know what

category/VOC content limit this coating would be required to

meet.

Response: The commenter did not provide any details

regarding the concrete/seal finish being manufactured. However,

the coating may be in the concrete protective coating category

with a VOC content limit of 400 g/l. Also, the final rule

includes a new category for concrete curing and sealing compounds

with a VOC content limit of 700 g/l. The commenter should review

both of these category definitions before making a determination

as to the appropriate category and VOC content limit.

Comment: One commenter (IV-D-30) argued that the proposed

VOC content limit of 400 g/l for concrete protective coatings

cannot be met by existing industry technology, and the commenter

requested that the limit for this category be raised to 850 g/l. 

According to the commenter, there are waterborne alternatives to

these solventborne systems, but there are significant

disadvantages to them. The commenter did not elaborate on the

disadvantages of waterborne alternatives.

Response: The EPA has retained the VOC content limit of

400 g/l for concrete protective coatings in the final rule. The

concrete protective coatings category was one of 14 specialty

coating categories proposed because discussions during regulatory

negotiations and/or petitions from individual companies provided

support for inclusion of these categories and an associated VOC

content limit. These limits were separate from the broader

category and limit to which the coatings otherwise would have

been assigned. No data were collected in the VOC Emissions
2-227

Inventory Survey and, in this case, only a couple of State rules

(Oregon and Kentucky) have this category. The VOC content limit

for this category is 400 g/l in both of these State rules. The

EPA believes that the exceedance fee option and tonnage exemption

in the final rule offer sufficient compliance flexibility to

allow the commenter to continue manufacturing and marketing this

product while continuing reformulation efforts.

Concrete curing compounds.

Comment: Several commenters (IV-D-30, IV-D-85, IV-D-152/

IV-E-17, IV-E-15, IV-E-16, IV-D-154, IV-D-179, IV-D-187,

IV-F-1e, IV-G-01) commented on the proposed VOC content limit of

350 g/l for the concrete curing compounds category, which is used

predominantly in highway construction. Seven commenters

(IV-D-30, IV-D-152/IV-E-17, IV-D-154, IV-D-179, IV-E-15, IV-E-16,

IV-G-01) argued that the proposed limit is achievable. One

commenter (IV-D-30) argued that the proposed VOC content limit

for this category could easily be met with existing industry

technology and could even be lowered from 350 to 300 g/l. 

Another commenter (IV-D-154) asserted that no new technology is

needed to produce, market, or apply coatings with the proposed

VOC content. This commenter indicated that parts of the country

have been operating under similar rules for several years. The

commenter added that raw material suppliers have been offering

ingredients specifically designed for use in low-VOC coatings for

several years and concluded that small businesses would find

those suppliers to be a good source for assistance in formulating

coatings to meet the VOC content limit of 350 g/l. Another

commenter (IV-D-179) informed the EPA of several completely VOCfree concrete curing compounds which have pending patents. The

commenter supported implementing the proposed rule as soon as

possible. This commenter stated that raw material costs for the

clear and pigmented concrete curing coatings are $.65 and

$.85-per gallon, respectively. In addition, the raw materials

for these coatings are non-hazardous and the finished coating

does not have any detectable VOC at 280 F. The commenter argued o

that moisture loss of 0.28 kilogram per square meter is normal
2-228

with some testing as low as 0.07 kilogram per square meter. 

These coatings are manufactured to meet a number of

specifications of the American Society for Testing and Materials,

including ASTM C-309, Type 1, 1D, and 2; Class A.

One commenter (IV-G-01) provided a table summarizing VOC

emissions from their waterborne concrete curing compounds which

comply with the EPA's proposed rule and meet California's

architectural coating regulations. The commenter produces these

waterborne curing compounds in the range of 250-350 g/l. The

commenter was disappointed that other manufacturers and States do

not promote proper curing in highway construction and, therefore,

his company does not compete for business in that area.

Another commenter (IV-D-152/IV-E-17) stated that the

proposed 350 g/l VOC content limit for concrete curing compounds

is technologically practical and that compliant waterbased

coatings with adequate performance are available to meet the

needs of the concrete curing industry. This commenter explained

that the concrete curing compounds category has been used as an

umbrella for all products with the capability of performing as

curing compounds. However, according to the commenter, these

products may be designed as curing compounds only or as curing

and sealing compounds. The difference is that curing compounds

have the single function of providing moisture retention for

curing. Curing and sealing compounds, however, function as

longer term sealers that provide protection, aesthetics, and

durability in addition to curing; and, according to the

commenter, cannot meet the proposed 350 g/l VOC content limit. 

The commenter argued that these were two totally distinct

categories.

On the other hand, one commenter (IV-D-85) suggested a VOC

content limit of 625 g/l for the category. The commenter

believes the proposed limit eliminates most concrete curing

membranes from the market and stated that many companies do not

sell curing compounds in States which have the 350 g/l limit. 

This commenter is not convinced that the track record of the

waterborne systems has been proven to properly cure concrete and
2-229

argued that improper curing sacrifices concrete strength which

may cause collapses in high-rise buildings and bridge

constructions. Also, the 350 g/l VOC content formulations that

the commenter has seen typically fail the ASTM C-309 moisture

retention test.

Response: Based upon consideration of these comments, the

EPA has concluded that the technology does exist to achieve the

VOC content limit of 350 g/l for concrete curing compounds. The

EPA has retained the 350 g/l VOC content limit for this category

in the final rule. All of the commenters, except one, argued

that the proposed limit is achievable. In addition, several

States, including California, Arizona, Massachusetts, New Jersey,

and New York, have had a VOC content limit of 350 g/l for this

category for several years. Concrete curing compounds are most

commonly used in road construction. Since roads are not

generally paved in the winter, the lower VOC technology (350 g/l)

for concrete curing compounds can be used even in cold weather

States, such as Minnesota. If specific applications necessitate

the manufacture and use of coatings with VOC contents higher than

350 g/l for concrete curing compounds, the final rule provides a

tonnage exemption and/or exceedance fee option. These options

could provide additional flexibility to manufacturers.

Regarding the commenter’s point about the differences

between concrete curing compounds and concrete curing and sealing

compounds, the EPA has established a separate coating category in

the final rule for concrete curing and sealing compounds (see

discussion in section 2.2.4.2 of this document).

Primers and undercoaters.

Comment: One commenter (IV-D-153/IV-D-207, same company)

recommended that all primers and undercoaters be allowed a

450 g/l VOC content limit instead of the proposed 350 g/l VOC

content limit in order to ensure the continuing availability of

quality coatings. The commenter argued that the prime coat

affects the integrity of all succeeding coats. The commenter

argued that high solids alkyd primers and undercoaters that would

be required to meet the lower level are difficult to apply and do
2-230

not have the positive drying characteristics which are essential

for sanding and recoating quickly. According to the commenter, a

properly applied primer ensures a long life for a coating system

and prevents emissions resulting from excessive repainting. 

Another commenter (IV-F-2) maintained that their company cannot

meet the proposed 350 g/l VOC content limit but offered no basis

for this statement. 

Response: The EPA has retained the proposed VOC content

limit of 350 g/l for primers and undercoaters based on

consideration of survey data and State architectural coating

regulations. The 1990 VOC Emission Inventory Survey showed that

about 82 percent of solventborne and waterborne sales for primers

had VOC contents at or below 350 g/l and about 60 percent of

solventborne and waterborne undercoaters sales were at or below

350 g/l. All of the State architectural coating rules reviewed,

without exception, have a 350 g/l VOC content limit for primers

and undercoaters. Therefore, the EPA believes this is convincing

evidence that a VOC content limit of 350 g/l is an appropriate

level. 

Mastic texture coatings.

Comment: One commenter (IV-D-30) indicated that the

proposed VOC content limit of 300 g/l for mastic texture coatings

effectively eliminates the use of solventborne systems and argued

that waterborne systems are considered inferior. The commenter

did not elaborate on any specific problems with waterborne

coatings. 

Response: Based on a review of survey data and State

architectural coating rules, the EPA does not agree that the

proposed VOC content limit of 300 g/l effectively eliminates the

use of solventborne mastic texture coatings and has not made any

change in the VOC limit for these coatings. Mastic texture

coatings are highly viscous materials that are waterborne or

solventborne and are used for interior and exterior masonry by

homeowners and contractors. According to the 1990 VOC Emission

Inventory Survey, 96 percent of the total sales had VOC contents

at or below 300 g/l. In addition, all of the State rules, except
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New Jersey and New York, have a VOC content limit of 300 g/l for

this category. The State of New Jersey and the New York

metropolitan area have a 200 g/l VOC content limit. These limits

have been in effect since 1994 or earlier. The EPA believes that

the available information demonstrates that the proposed limit is

appropriate.

Traffic marking coatings. 

Comment: Several commenters (IV-D-03, IV-D-24, IV-D-40,

IV-D-41, IV-D-121, IV-D-153/IV-D-207, IV-D-189) stated that the

use of latex and other low-VOC traffic marking coatings would be

limited by cold temperatures.

Comments received from the Department of Defense (DOD) (DOD

Steering Committee representing the Navy, Air Force, and Army as

well as several DOD components and agencies) (IV-D-03, IV-D-121)

requested an exemption to allow emergency use of solventborne

airfield traffic markings when the ambient temperature is below

55 F. One of the commenters (IV-D-121) stated that VOC o

compliant waterborne coatings satisfy the needs of the Air Force

in most cases. However, the commenter stated that until low-VOC

markings are developed that perform well at low temperatures,

solventborne markings must be used when temperatures are below

55 F. The commenter stated that the typical VOC content of these o

solventborne coatings is 350 g/l to 400 g/l. The commenter

argued that when airfield markings become obscured, they no

longer provide visual cues for safe operation of aircraft and

support vehicles, and therefore, must be re-marked immediately,

regardless of temperature. The commenter asserted that in

northern climates, operations could be terminated or severely

degraded if solventborne markings are not available for use at

lower temperatures. The commenter suggested that this exemption

could be limited to airfields that experience extended periods of

cold weather or rapid deterioration of existing markings during

cold weather. Two other commenters (IV-D-03, IV-D-24) also

requested reconsideration of the provision to allow the use of

higher-VOC traffic markings if seasonal conditions dictate, as

allowed by the Federal Highway Administration.
2-232

One commenter from a State Department of Transportation

(DOT) (IV-D-40) was concerned with pavement marking safety; that

is, the inability to use low-VOC coatings during cold weather. 

This commenter pointed out that the use of latex or other low-VOC

coatings could shorten the fall construction season. One

commenter (IV-D-41) from another State DOT, who expressed strong

opposition to the proposed VOC content limit, explained that the

proposed rule would have an adverse effect on their State’s

pavement marking program because it will be forced to change from

solventborne coatings to other lower-VOC coatings. The commenter

claimed that the overall performance of waterborne coatings

currently in use is not acceptable. The commenter argued that

low-VOC coatings would result in an increase in the total cost of

the striping and traffic marking program that would adversely

affect the safety of State highways. The commenter objected to

having the proposed rule apply to pavement marking from a cost

perspective. According to the commenter, exclusive use of

waterborne coatings decreases the application season

dramatically, and the State funds are too low to warrant

purchases of additional equipment to address the State's pavement

needs in a restricted application season. The commenter

suggested that the rule creates an economic obligation that

constitutes an unfunded mandate with respect to striping highway

pavement.

One commenter (IV-D-189), a national trade association,

recommended that the traffic marking category be amended to allow

the use of higher (250 g/l) VOC content coatings during the nonozone season. The commenter explained that the proposed VOC

content limit of 150 g/l is technically acceptable to the

majority of State DOT agencies under normal application

conditions; however, application of traffic marking coatings at

this level is limited in cold weather. According to the

commenter, a solution to the cold weather application problem is

a provision which would allow government agencies to use higher

VOC (250 g/l) traffic marking coatings during the non-ozone

season in order to ensure highway safety. The commenter stated
2-233

that the incorporation of a seasonal exemption for the

application of higher-VOC traffic marking coatings would have no

negative impact on the environment and would have a positive

impact on public safety.

One manufacturer (IV-F-2) asked why the EPA proposed more

stringent requirements for the traffic marking coatings category

than for the other categories. Another commenter (IV-F-2) stated

that the proposed limit for traffic marking coatings is not

achievable.

One commenter (IV-D-153/IV-D-207 (same company)) recommended

that the traffic marking coatings category with a 150 g/l VOC

content limit be defined as coatings used only for marking

streets and highways, which is scheduled during the warm months

when latex traffic coatings can be used.

One commenter (IV-D-173) supported the use of alkyd-based

street marking paints because many customers paint in the fall

and winter when waterbased formulations will not work. In these

situations, the commenter argued that solventborne coatings that

dry quickly are the only option.

One commenter (IV-G-18) manufactures an acetone-based

traffic coating but it is not highly recommended due to its high

flammability. Also, acetone traffic coatings can cost

50-100 percent more than conventional solventborne coatings.

Two commenters (IV-D-44, IV-D-182) stated that low-VOC

content traffic marking coatings will have increased drying time,

poor leveling properties and poor durability as a result of

reformulation to comply with the proposed rule. Both commenters

stated that they did not have documentation that could be made

public to support this statement regarding performance of low-VOC

content traffic marking coatings.

Alternatively, one commenter (IV-D-191) argued that the

proposed VOC content limit of 150 g/l for traffic marking

coatings is not stringent enough. The commenter referred to a

California-South Coast Air Quality Management District staff

report which showed that half of the market already complies with

the 150 g/l VOC content limit. The report also noted that there
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would be no cost increase necessary to meet this limit. 

Therefore, the commenter reasoned that the traffic marking

coating category VOC content limit in the final rule should be

lower than the proposed 150 g/l, and a second phase VOC content

limit should be set at 0 g/l for the year 2000.

Response: The EPA has carefully evaluated the comments and

has conducted a separate assessment (IV-B-3) of currently

available low-VOC technologies for traffic marking coatings and

has evaluated costs for new and retrofitted traffic marking

application equipment. The assessment results indicate that lowVOC technologies to comply with the 150 g/l VOC content limit for

traffic marking coatings are available and include waterborne

coatings, thermoplastics, 2-part systems including epoxy and

polyesters, tapes and preformed thermoplastics, raised pavement

markers, and acetone-based coatings. The assessment results also

show the characteristics, advantages, and disadvantages of using

these compliant coatings. For example, epoxy and thermoplastics

have negligible VOC contents and boast longer durability than

either waterborne or solventborne coatings, but equipment changes

and application expenses are higher than for solventborne or

waterborne coatings. Compliant acetone-based coatings, unlike

waterborne coatings, can be applied in temperatures below 50 Fo

and are compatible with solventborne application equipment. 

Therefore, the use of acetone-based coatings is one alternative

to waterborne coatings for highway striping in cold weather to

ensure highway safety. Exercise of due caution would be

necessary during application of acetone-based coatings due to

their flammability.

In addition, according to recent information obtained on the

performance of low-VOC traffic marking coatings (IV-B-4), acrylic

emulsion coatings can be applied under a variety of temperature

and humidity conditions with reasonable drying times and little

tracking damage. Acrylics can be interchanged with solventborne

coatings without adhesion problems, and adhesion of reflective

hydrophillic coated beads to acrylic lines is superior to

solventborne coatings. The 100 percent acrylic waterborne
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coatings can last twice as long as traditional solventborne

coatings, they are more durable, safer for workers and the

environment, and result in much easier cleanup of equipment. 

According to two 1997 publications (IV-B-4, Ref. #14 and #15),

new technology latex traffic marking coatings dry as quickly, if

not more quickly than solventborne coatings, and provide better

durability compared to traditional fast-dry coatings. Polyester

coatings provide unsurpassed durability, making them the most

cost-effective coating for asphalt, when compared on a life-cycle

basis with alternative coatings and marking materials. 

The EPA contacted commenters (several State DOTs and one

county) to obtain additional information (IV-E-1, IV-E-2,

IV-E-32, IV-E-29, IV-E-31). Two of these agencies/commenters

stated that the extended compliance date of the rule has allowed

them time to purchase new equipment; one (IV-E-32) is currently

using compliant coatings and the other (IV-E-41) will be by 1999. 

One State DOT in a northern climate (IV-E-42) uses 98 percent

waterborne coatings and 2 percent solventborne coatings. This

State DOT concluded that waterborne traffic marking coatings are

more durable than solventborne coatings. Another State DOT

(IV-E-2) has used 100 percent waterborne coatings for over a year

and uses contractors to apply thermoplastics and epoxies. Yet

another State DOT (IV-E-29), also in a northern climate, uses

contractors that apply 90 percent of their traffic marking

coatings, which are waterborne, and the State applies the

remaining 10 percent, which are solventborne coatings.

In addition, the EPA contacted a Department of Defense (DoD)

representative (IV-E-48) regarding DoD comments on emergency cold

weather airfield markings. As discussed in the response to

comments on zone marking coatings (see section 2.2.4.2 of this

document), the services typically purchase coatings in 5-gallon

containers and transfer the coatings to 1-gallon or 1-quart

containers. Therefore, these coatings would be subject to the

zone marking coating category VOC content limit of 450 g/l

because they are sold or distributed in a container with a volume

of 5 gallons or less.
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According to the EPA’s assessment, the total sales of

traffic marking coatings have been fairly constant from 1990 to

1995. About 65 percent of coatings used on roadways are

purchased by State highway departments, 25 percent are sold to

city and county road authorities, and about 10 percent are used

in areas such as parking lots and garages. Of the 65 percent of

coatings purchased by State agencies, more than 30 State DOTs use

waterborne coatings rather than solventborne, and 10 States use a

combination of waterborne and solventborne coatings. The use of

solventborne coatings for striping declined from 80 percent in

1991 to 55 percent in 1994, whereas the use of waterborne

coatings and other striping materials has increased. Based on

available information, the assessment concludes that about

58 percent of traffic marking materials used in the United States

in 1995 comply with the 150 g/l VOC content limit in the proposed

rule (assuming all technologies except solventborne coatings are

compliant).

The EPA agrees that the use of waterborne coatings

exclusively could shorten the highway striping season somewhat in

very cold climates. The EPA notes, however, that neither

waterborne nor solventborne coatings work under extreme

conditions and that the “seasons” are, therefore, not markedly

shorter in many places. In addition, as discussed previously,

there are other low-VOC compliant technologies currently in use

that could be applied under normal application conditions or in

cold weather, including emergency situations, thus ensuring

public highway safety. The EPA does not agree with the

suggestion that the traffic marking coating VOC content limit

should be lower than 150 g/l. All of the information available

to the EPA, including information submitted by other commenters,

indicates that a VOC content limit of 150 g/l provides

formulation flexibility for manufacturers to supply traffic

marking coatings for nationwide applications. Therefore, the EPA

has concluded that performance requirements can be met with a VOC

content limit of 150 g/l for traffic marking coatings, and it has

retained this limit in the final rule.
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In response to concerns about the cost of equipment

potentially necessary to apply non-solventbased coatings, the EPA

investigated the relevant equipment. Several companies

manufacture and sell traffic striping equipment. The cost of the

equipment varies by size and type of equipment. For various

types of solventborne and waterborne equipment, the cost ranges

from a minimum of $1,000 for a handheld striper to $280,000 for a

Tandem Axel Truck (500 to 800 gallon capacity). For

thermoplastic marking equipment, the cost ranges from $1,000 to

$225,000. The cost of epoxy equipment ranges from $2,000 to

$200,000. For tape application equipment, the cost starts at

$5,000; some small jobs do not require any special equipment. 

Estimates of equipment lifetimes were provided by equipment

vendors and State agencies (IV-B-3). State DOTs generally

estimate 20-year lifetimes for large traffic striping trucks. In

comparison, manufacturers estimate a 5- to 10-year shorter

lifetime for the average truck. According to equipment vendors

(IV-B-3), before 1990, most stripers applied solventborne

coatings. From 1988 to 1998, there has been a pronounced shift

from solventborne stripers to waterborne stripers and other

stripers (i.e., thermoplastics, epoxies, etc.). One equipment

vendor’s (IV-B-3) domestic sales have been for only

waterborne-compatible equipment since 1990, and one vendor

(IV-B-3) has exported only solventborne-compatible equipment

since 1993 (i.e., has had no domestic sales of this equipment). 

According to another vendor (IV-B-3), after 1996, it appears that

the government sector began to move away from doing its own

striping and toward hiring contractors to stripe roads.

Based on available information (IV-B-3), it is estimated

that the national population of traffic stripers is comprised of

38 percent solventborne, 42 percent waterborne, 17 percent

thermoplastic, and 3 percent epoxy. All equipment sales reported

in 1996-1997 are compatible with low-VOC technologies.

In summary, the EPA’s assessment shows that the rule may

impact the cost incurred by traffic marking coating users,

including material costs, equipment costs, and operational costs. 
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Based on the assessment in the “Control Techniques Guidelines on

Traffic Markings,” the use of waterborne, polyester, and epoxy

traffic marking coatings results in cost savings compared to use

of solventborne coatings when accounting for expected lifetimes. 

The EPA’s assessment estimates that waterborne coatings are the

least expensive choice because equipment may be retrofitted (at a

lower cost compared to purchasing completely new equipment) and

the increases in material cost (i.e., cost difference between

waterborne and solventborne coatings) is minimal. Durability

estimates factor into cost comparisons on an annual basis instead

of an initial purchase and application cost. Shifting

technologies away from solventborne coatings requires equipment

changes in addition to any increase or decrease in coating costs.

The EPA has estimated the total annualized national cost of

switching from solventborne stripers to waterborne compatible

stripers to be $3.7 million. In terms of operational costs, the

use of waterborne coatings exclusively could shorten striping

seasons in cold climates because of the temperature restriction

for curing waterborne coatings. However, as stated previously,

other low-VOC technologies are available for use during these

periods.

In addition to the reasons stated above for retaining the

150 g/l VOC content limit for traffic marking coatings, the EPA

believes that the final rule provides the flexibility needed for

coating manufacturers to continue to provide their customers

(e.g., State DOTs and military airfields) with higher-VOC content

coatings to the extent they are needed. The exceedance fee and

VOC tonnage exemption provisions of the rule provide a mechanism

for such instances.

Comment: One commenter (IV-D-53) argued that the proposed

traffic marking coating VOC content limit would be a tremendous

financial burden on its rural county. This commenter has only

one striper which would have to be replaced to apply the lowerVOC coating, and there are not sufficient funds available for a

new striper.
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Another commenter (IV-D-116), a State DOT, argued that the

proposed traffic marking coating limit would effectively ban the

manufacture of conventional traffic marking coatings currently in

use and expressed concern about their ability to continue to

provide cost-effective pavement markings, the resultant fiscal

impacts of the proposed rule, and the implications to their

overall transportation safety program. According to the

commenter, implementation of the rule would result in an

increased cost of a minimum of $2 million the first year

(equipment and coating costs). Each succeeding year would result

in a minimum additional $1.5 million cost for low-VOC coatings. 

The commenter added that no source of additional State funds is

presently available, but they will need to provide continued

necessary pavement markings. The commenter requested that the

EPA consider the fiscal impacts of the rule on State DOTs.

Response: The Agency received a number of comments from

State and local governments concerned that EPA had overlooked

potential impacts of the proposed rule upon small governments. 

Specifically, these commenters claimed that the proposed rule

imposed a VOC content limit on the traffic marking coatings

category that would force coatings manufacturers to cease

production of solventborne traffic marking coatings and that

State and local governments would therefore be forced to change

their current traffic marking equipment. The commenters

explained that older traffic marking equipment is not compatible

with non-solventborne coatings and that replacement of this

equipment to utilize new types of coatings could be a significant

cost to all affected entities which include small governments.

The comment letters suggest that the impacts of the proposed

rule could trigger the requirements of UMRA section 203. As

stated in the preamble to the proposed rule, UMRA section 203

provides that before EPA establishes any regulatory requirements

that may significantly or uniquely affect small governments,

including tribal governments, the Agency must have developed a

small government agency plan. The plan must provide for

notifying potentially affected small governments, enabling
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officials of affected small governments to have meaningful and

timely input in the development of EPA regulatory proposals with

significant Federal intergovernmental mandates, and informing,

educating, and advising small governments on compliance with the

regulatory requirements. See 61 F.R. 32745.

Prior to proposal, a few representatives of State

Departments of Transportation raised the issue of the potential

need to replace older traffic marking equipment as one possible

impact of a rule that restricted the VOC content of traffic

marking coatings. The Agency concluded, however, that the

proposed rule would only regulate manufacturers and importers of

architectural coatings, and as such contained "no Federal

mandates (under the regulatory provisions of Title II of UMRA)

for State, local, or tribal governments." 61 F.R. 32745.

The commenters on the proposal have reiterated concern about

the issue of the potential need to replace traffic marking

equipment as a result of the VOC content limit imposed by the

rule. In essence, the commenters are concerned that the lower

VOC content limit of the rule will require them to replace older

existing equipment used for the application of conventional

higher VOC solventborne coatings more quickly than they otherwise

would have. EPA has considered these comments carefully to

reexamine whether the rule will have any significant or unique

impacts upon small governments as contemplated by UMRA

section 203. At the outset, EPA notes that because the rule only

regulates manufacturers and importers of coatings, the impacts

noted by the commenters are indirect effects. It is unclear

whether the Agency is required to assess such indirect effects in

connection with UMRA section 203. Nevertheless, whether or not

the Agency should consider indirect impacts for this analysis,

the Agency believes that those impacts are neither significant

nor unique in this instance.

EPA has investigated to determine the significance of the

impacts of the rule upon small governments by, inter alia,

following up with the commenters, by making inquiries regarding

existing inventory of traffic marking equipment across the
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country, by assessing the availability and cost of replacing or

retrofitting traffic marking equipment, and by estimating the

potential cost to replace traffic marking equipment as a result

of changes in the VOC content of traffic marking coatings. EPA

conducted the analysis based on data reasonably available to the

Agency on the coatings and traffic marking equipment in use in

the United States by all applicators. Based upon this analysis,

EPA estimates that the total aggregate annual impact of the rule

on all governmental entities, including small governmental

entities, should be no more than $3.7 million (in 1996 dollars). 

Small governments would bear some portion of these costs. See

Docket Item IV-B-3. EPA believes that this amount of aggregate

impact for governments across the Nation is not significant for

purposes of UMRA section 203. In addition, the Agency notes that

this number may overestimate the total impact based upon the

information provided by governments that many of them have

already replaced their equipment in recent years and that new

equipment is compatible with both waterborne and solventborne

coatings.

Similarly, the Agency believes that the architectural

coatings rule will not have a "unique" effect upon small

governments as contemplated by UMRA section 203. The term

"unique" is not defined in the statute, but the Agency believes

that by all reasonable applications of this measure, the rule

will not have a unique affect upon small governments. The rule

applies not to government entities as government entities, but

rather to manufacturers and importers of coatings. To the extent

that small governments are directly regulated entities as

manufacturers or importers of coatings, they are not uniquely

affected in the sense that they are not the sole regulated

entities. The indirect effects of the rule likewise fall not

uniquely upon small governments as users of coatings, but upon

all users of coatings and thus small governments are not uniquely

affected in the sense that they are not the sole affected users. 

Within the category of traffic marking coatings alone, the

impacts of the rule fall not uniquely upon small governments as
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users of the coatings, but upon governments of all sizes that

engage in traffic marking activities, including States and other

large governmental entities. Thus, the Agency has concluded that

the rule will not have a unique effect upon small governments for

purposes of UMRA section 203.

Even though the Agency believes that the rule will not have

significant and unique impacts upon small governments, EPA is

planning to perform outreach to those affected by the rule to

insure that they are apprised of the impacts of the rule on

traffic marking coatings. Specifically, EPA plans to devote a

section of the small business compliance guide to this education

and outreach effort. Finally, EPA notes that the rule is

unlikely to eliminate the availability of conventional

solventborne traffic markings. The Agency anticipates that

manufacturers will continue to produce solventborne coatings,

either by developing compliant products or by exercising the

tonnage exemption or exceedence fee provisions. So long as there

is sustained demand for such coatings, the Agency believes that

such coatings will continue to be available. This suggests that

small governments should generally be able to obtain higher VOC

products for a reasonable period of time, albeit at a moderately

higher cost, that will allow them to phase out their older

equipment and shift to equipment compatible with waterborne

coatings. 

2.2.4.4 Recycled Coatings

Comment: One commenter (IV-D-120) suggested that credit for

recycled coatings should be considered if and as long as the EPA

determines that such credit does not significantly reduce the

rule's effectiveness. The commenter requested that the EPA

consider allowing credit not only for recycled coatings, but also

for recycled VOC.

Response: The EPA believes that the recycled coating

provision will not reduce the effectiveness of the rule, but

instead will encourage recycling by providing incentives to

manufacturers who recycle coatings. Recycling these coatings
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eliminates the need for disposal of unused coatings and reduces

the amount of new coating that must be manufactured. 

The EPA has not expanded the recycled coating provision to

include recycled VOC. The flexibility in VOC content allowed for

recycled coatings is based on comments received by manufacturers. 

No such flexibility was requested by manufacturers for recycled

VOC. Moreover, the additional recordkeeping and reporting that

would be required for recycled VOC would probably negate any

benefit obtained from such a provision. 

Comment: One commenter (IV-D-161) supported the option 

EPA provided in the proposed rule for calculation of the VOC

content for recycled coatings, because it achieves the goal of

reducing VOC without providing a disincentive for companies to

develop coatings using post-consumer coatings.

Response: The EPA has retained the recycled coating

provision in the final rule to encourage recycling by providing

flexibility to manufacturers who recycle coatings.

Comment: Two commenters (IV-D-189 and IV-F-2gen) stated

that the EPA should clarify that the recycled coating credit does

not apply to the reprocessing of coatings sent to distributors or

the in-plant reprocessing of coatings.

Response: The EPA did not intend for the recycled coating

provision to be extended to the reprocessing of coatings sent to

distributors or to the in-house reprocessing of coatings. The

EPA has clarified the intent of the recycled coating provision by

adding the statement "by a consumer" to the definition of "postconsumer coating." Also, the words "community-based household"

have been deleted because post-consumer coatings collected are

not limited to these hazardous waste collection programs.

"Post-consumer coating means an architectural coating that

has been previously purchased by a consumer or distributed

to a consumer but not applied, and reenters the marketplace

to be purchased by or distributed to a consumer.

Post-consumer coatings include, but are not limited to,

coatings collected during hazardous waste collection

programs for repackaging or blending with virgin coating

materials."
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Comment: One commenter (IV-F-1b) stated that the

recordkeeping requirements of the recycled coating provision will

inhibit recycling. The commenter requested that the EPA hold

recordkeeping and reporting requirements for the manufacture of

paint with post-consumer content to gross IRS type reports with

records being kept by manufacturers and supplied on request.

Response: The EPA has determined that the recordkeeping and

reporting requirements for the recycled coating provision are

necessary for enforcement purposes. The information required to

be maintained and reported is information that the manufacturer

will have already generated to determine the recycled coating

credit, and therefore, the EPA contends that the recordkeeping

requirements will not inhibit or reduce the amount of recycling.

Comment: One commenter (IV-F-1e) expressed concern

regarding disposal of unused coatings because they do not have

post-consumer recycling. The commenter manufactures urethane

products, which are susceptible to moisture. The commenter

cannot take back a product once it is opened. The commenter is

concerned about needing a treatment, storage, and disposal (TSD)

permit and becoming a hazardous waste storage facility if they

accept post-consumer coatings.

Response: The architectural coating rule does not require

manufacturers to recycle coatings, it provides incentive for

manufacturers to do so. It is expected that some types of

coatings may be more conducive to recycling than others.

2.2.5 Compliance Time Requirements

2.2.5.1 General

Comment: In the proposal preamble (61 FR 32732), the EPA

requested comment on the adequacy of the compliance lead time for

all regulated entities. The proposed compliance date of

April 1, 1997, would have allowed manufacturers of architectural

coatings approximately 3 months from publication of the final

rule to achieve compliance (assuming promulgation occurred on

January 1, 1997). Thirty-three commenters

(IV-D-02/IV-D-77/IV-F-01(l), IV-D-08, IV-D-21, IV-D-28, IV-D-44,

IV-D-73, IV-D-85/IV-F-02c, IV-D-86/IV-F-01e, IV-D-93, IV-D-114,
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IV-D-117, IV-D-120, IV-D-129, IV-D-158, IV-D-161/IV-F-01j,

IV-D-162, IV-D-163, IV-D-169/IV-F-02n,

IV-D-170/IV-F-02p/IV-F-02p, IV-D-171, IV-D-180, IV-D-182,

IV-D-184, IV-D-185, IV-D-189/IV-F-01o, IV-F-01b,

IV-D-186/IV-F-01e, IV-F-01k, IV-F-01s, IV-F-02gen, IV-F-02e,

IV-F-02j, IV-F-02r) commented on the proposed compliance date. 

Of these 33 commenters, 28 commenters stated that the 3-month

compliance period provided inadequate time to achieve compliance

and 5 commenters supported a rapid enactment of the rule. 

Commenters supported compliance periods ranging from 6 months

compliance time (IV-D-28) to 5.5 years (IV-D-02/IV-D-77/

IV-F-01(l)).

Unspecified compliance time. Five commenters (IV-D-73,

IV-D-180, IV-F-02gen, IV-F-02j, IV-F-02r) supported more time for

compliance but did not recommend a specific compliance time. Two

commenters (IV-F-02gen and IV-D-02r) stated that the

April 1, 1997 date (3 months compliance time) would not allow

enough time to develop compliant coatings and one commenter

(IV-F-02j) requested more time for product testing. One

commenter (IV-D-180) stated that adequate warning of the

compliance date is necessary for manufacturers to change labels,

products, and containers. Another commenter (IV-D-73) explained

that developing quality formulas that will withstand cold and

humid weather in areas like New York would demand more time

(unspecified compliance time) for reformulation.

One year or less compliance time. Ten commenters requested

a year or less compliance time; seven commenters (IV-D-93,

IV-D-161/IV-F-01j, IV-D-169/IV-F-02n, IV-D-171, IV-D-185,

IV-D-189/IV-F-01o, IV-D-85/IV-F-02c) requested a year, and three

commenters (IV-D-21, IV-D-28, IV-D-129) requested less than a

year. Two commenters (IV-D-185, IV-D-189/IV-F-01o) stated that

industry needed a full year to comply in order to complete

laboratory work, adjust production formulations, reprint labels,

adjust inventories, budget expenses, and otherwise modify their

operations. One commenter (IV-D-185) pointed out that lead time

was especially important for small businesses who have limited
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resources and believed that a 1 year compliance period would

reduce the need for individual variances. One commenter

(IV-D-93), who had 91 products to reformulate, asked that the

time to comply be extended to January 1998 (1 year compliance

time) to allow for reformulation and use of existing label

inventories. One commenter (IV-D-171) stated the April 1, 1997

date (3 months compliance time) would preclude adequate time for

research and development needed to achieve required VOC

reductions and for labeling reformatting. One commenter

(IV-D-169/IV-F-02n) requested that the rule be promulgated as

soon as possible with implementation 1 year after publication to

accommodate orderly transition in the marketplace. According to

the commenter, decisions in the retail marketplace are made

around September 1, so a commitment to prompt publication of the

rule would allow all parties to plan necessary product changes at

the retail level. At the public hearing the commenter explained

that the decision process regarding products is especially

complicated for products with FIFRA requirements. One commenter

(IV-D-85) requested a 1 year compliance time at the public

hearing but requested a compliance date of September 1999

(33 months compliance time) in their written comment letter to

allow time for reformulation, safety and toxicological testing,

recoatability and remove ability evaluation, production, and

education of the public sector. Another commenter

(IV-D-161/IV-F-02n) supported a 1 year compliance period that

would apply to all companies and all aspects of the rule

including labeling provisions, reporting provisions, and VOC

standards. One commenter (IV-D-28) recommended that all

manufacturers and importers, including small businesses, be held

to a July 1, 1997 (6 month compliance time) compliance date. Two

commenters (IV-D-21, IV-D-129) requested 8 months. One of the

commenters (IV-D-21) explained that an 8 month compliance time

would allow them to avoid excessive administrative, travel, and

reprinting expenses.

More than 1 year compliance time. Eleven commenters

(IV-D-08, IV-D-44, IV-D-114, IV-D-120, IV-D-158,
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IV-D-170/IV-F-02p, IV-D-182, IV-D-186/IV-F-01e, IV-F-01(l),

IV-F-01m, IV-F-02e) requested more than 1 year of compliance

time: three commenters (IV-D-112, IV-D-114, IV-D-158) requested

1 to 2 years; two commenters (IV-D-44, and IV-D-182) requested 2

to 3 years; four commenters (IV-D-08, IV-D-186/IV-F-01e,

IV-F-01m, IV-F-02e) requested 3 to 5 years; one commenter

(IV-F-01(l)) requested 1.5 to 5.5 years; and one commenter

(IV-D-120) supported a phased compliance approach and extended

compliance date. One commenter (IV-D-114) explained that his

company required 6 to 12 months to develop a new roof coating and

a minimum of 12 additional months for performance testing;

therefore, the commenter requested 18 to 24 months compliance

time. One commenter (IV-F-02e) recommended 3 to 4 years of

voluntary compliance to allow companies to adjust to the

requirements of the rule. According to the commenter, 3 to

5 years was the lead time most commonly advocated throughout the

August 13, 1996 public meeting.

Three commenters (IV-D-170/IV-F-02p, IV-D-186/IV-F-01e,

IV-F-01(l)) implied that 3 months’ reformulation time was

unreasonable by referencing a presentation made during the

July 28-30, 1993 Regulatory Negotiation meeting and discussed in

the Economic Impact Analysis and Regulatory Flexibility Analysis

of the Proposed Architectural Coating Rule (A-92-18, 11-A-5). 

The presentation, given by a representative of a large coatings

manufacturer, suggested that 2 to 3 scientist years or an elapsed

time of 1.5 to 5.5 years was necessary to develop a new product. 

This included time for formulating a white paint, formulating the

colors, formulating the tinting base paint, labeling, developing

material safety data sheets, technical data sheets, and color

cards, merchandising, scaling up to production volume,

introducing the paint to stores and distributing it. 

Additionally, one of the commenters (IV-D-186/IV-F-01e)

recommended that compliance be postponed until an appropriate

compliance time can be determined. Two commenters

(IV-D-120/IV-D-85), including one commenter (IV-D-85) who

specified a 1 year compliance time, pointed out that the proposed
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rule allows manufacturers to sell non-compliant products

manufactured prior to the effective date after the rule takes

effect. Therefore, manufacturers could theoretically stockpile

non-compliant products for sale after the rule takes effect. In

practice, however, the commenter (IV-D-120) stated that creating

an inventory of non-compliant products is a poor option because

inventory is expensive, quality deteriorates with age, and demand

for products fluctuates. One commenter (IV-D-08) stated that

complying with State architectural coating rules has taken it as

long as 6 years, however, compliance with such rules typically

require a 3 year time frame. The commenter stated that a

variance procedure could be used to extend compliance time and

would allow manufacturers reasonable flexibility for

implementation of the rule.

Two commenters (IV-D-158, IV-F-01m) claimed that at least

3 years would be necessary to reformulate, test, and market new

products. Although one commenter (IV-F-158) stated 3 to 5 years

would be necessary to reformulate and indicated that a third of

their products would need reformulation, they suggested a

compliance date of July 1, 1998 (18 months compliance time). The

other commenter (IV-F-01m) referenced the Allied Local and

Regional Manufacturers (ALARM) proposal in which the initial

standards would take effect 3 years from the date of final

promulgation of the rule. Another commenter (IV-D-182)

recommended a compliance date of April 2000 (39 months compliance

time) because more time is needed for testing. The commenter

explained that new products must be tested before they are

marketed and testing time varies by product line and by specific

product. For example, the commenter stated that testing interior

products can take months while exterior products can take years

to test. Another commenter (IV-D-44) recommended a compliance

date of April 2000 (39 months compliance time), or April 1999

(27 months compliance time) at the earliest. The commenter

specified that testing exterior products requires 2 to 3 years

and stated that the proposed deadline was unrealistic because of

reformulating, testing, marketing, and personnel requirements. 
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Four commenters (IV-D-02, IV-D-08, IV-D-120, and

IV-D-189/IV-F-01o), including one (IV-D-189/IV-F-01(o)) who

requested 1 year compliance time and one (IV-D-02) who supported

a small business compliance extension, implied that it is

unreasonable to require industry to begin compliance activities

before the rule is promulgated. One commenter (IV-D-120) pointed

out that industry will have wasted time and money if they

reformulate their products and promulgation does not occur. The

commenter continued by explaining that architectural and

industrial maintenance coatings are typically formulated for

specific application and performance requirements so

reformulation is not simple. The commenter explained that

research and development takes longer if technological means are

unavailable, and contracts and work plans specifying coatings are

difficult to modify. Furthermore, the industry potentially faces

loss of marketability of some categories and liability costs

associated with introducing alternative products. The commenter

preferred that the rule specify the time from promulgation

(2 years) rather than a date to insure adequate compliance time

in case of promulgation delays.

Compliance extension for labeling. Five commenters

(IV-D-93, IV-D-171, IV-D-189/IV-F-01o, IV-F-01b, IV-F-01s)

requested more time to comply with the proposed labeling

guidelines. One commenter (IV-D-93) asked for 1 year to comply

with labeling so that existing label inventories could be used. 

Another commenter (IV-D-189/IV-F-01(o)) asked for at least 1 year

to comply with any new labeling requirements. Two commenters

(IV-F-01b, IV-F-01s) suggested allowing the use of old labels on

compliant products until the existing label inventories are

depleted. The commenters stated that it is typical for large

quantities of containers and labels to be produced in advance;

therefore, such a provision would eliminate the need to destroy

large quantities of existing labels. According to one commenter

(IV-F-01b), the label inventory is composed of 10 to 20 million

existing labels that would have to be destroyed. Plus, the

commenter claimed that it takes longer than 1 year to design and
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print new labels. The commenter mentioned stickering as another

option but warned that the process is costly and ineffective. 

One commenter (IV-D-171) recommended a January 1, 1998 compliance

date (1 year from promulgation) for requirements found at

paragraph (a) of §59.402 (VOC standards), paragraphs (a) and (b)

of § 59.403 (labeling requirements), paragraph (b) of § 59.406

(initial report), and paragraph (d) of § 59.406 (date code

explanation). The commenter spent over $300,000 in 1996 on

labels required by amended Department of Transportation

regulations and expects labels for the architectural coating rule

to be more expensive.

Oppose compliance extension. Five commenters (IV-D-117,

IV-D-162, IV-D-163, IV-D-184, IV-F-01k) opposed extending the

compliance time beyond the proposed time (3 month compliance

time). One commenter (IV-D-117) pointed out that prompt

implementation was critical to air quality and that

section 183(e) is intended to obtain VOC emission reductions in a

timely fashion. One commenter (IV-D-162) stated that any

extension was unwarranted because the industry has already proved

its ability to produce compliant products, implying that

additional time for reformulating and testing product is not

necessary given the VOC content limits of the proposed rule. One

commenter (IV-D-163) explicitly stated that a compliance

extension to January 1998 (1 year) was unnecessary and that any

delay in emissions reduction would impact other programs that

rely upon national control measures including States with ozone

NAAQS nonattainment areas and possibly the Ozone Transport

Assessment Group (OTAG). Another commenter (IV-D-184) urged the

EPA to promulgate effective rules in a timely manner and

explained that the proposed January 1, 1997 date would diminish

the effectiveness of the rule by leaving State and local agencies

with a greater shortfall in VOC emission reductions to offset. 

Another commenter (IV-F-01k) believed that the proposed 3 month

compliance time was reasonable, assuming no further modifications

to the VOC content limits or the category definitions making the

rule more stringent than the current draft. The commenter stated
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that it was necessary to implement the architectural coating VOC

rule with a 3 months compliance time so that States and

localities would not need to implement local regulations that

would be a burden on industry. The commenter thus alluded to the

fact that many States are intending to rely on the architectural

coatings rule for VOC emission reductions and that any delay

might force them to enact their own differing standards, thereby

imposing burdens upon regulated entities.

Response: The proposed architectural coating rule had a

compliance date of April 1, 1997. At proposal, the EPA expected

to publish the rule on January 1, 1997. This schedule would have

allowed regulated entities approximately 3 months to comply with

the rule. After fully evaluating the comments received, the EPA

has decided to extend the compliance period for the final rule to

12 months.

Of the comments received where a compliance date was

specified, about one-third of the commenters supported a

compliance period between 3 months and 12 months. These

commenters stated that the additional compliance time would be

necessary to adjust formulations, reprint labels, adjust

inventories, use existing label stock, and conduct research and

development. The EPA agrees that this additional time is needed

and based on reported experience believes that a 12-month period

is adequate to accommodate this need.

Another third of the commenters stated that the compliance

period should be greater than 1 year to allow more time for

developing, performance testing, and marketing new products. In

particular, commenters stated that performance testing of

exterior products requires 2 to 3 years. The EPA has addressed

these comments in several ways. First, the compliance period in

the final rule was extended from 3 months to 12 months. Second,

the EPA believes that the primary concerns for many of these

commenters have been addressed through the creation of new

categories, clarification of definitions, or some other change to

the rule. For example, the primary concern of three of the

commenters was addressed through the creation of the concrete
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curing and sealing category with a VOC limit that will obviate

the need for a lengthy reformulation and testing process. Third,

the EPA has included a tonnage exemption in the final rule that

allows manufacturers to exempt low volumes of coatings from the

rule. Finally, the EPA has included the exceedance fee option in

the final rule that allows manufacturers who pay the fee to

continue to market non-compliant products.

The last third of the commenters stated that a compliance

extension was not necessary. The commenters provided the

following reasons: it would result in an adverse impact on the

environment; it would lead to additional State regulations; and

it is unnecessary given the current state of technology. The EPA

generally concurs with these sentiments, especially the concern

that a lengthy compliance extension could result in unnecessary

adverse environmental impacts. For this reason the EPA has

concluded that it is inappropriate to extend the compliance

period longer than is reasonably necessary based upon the

comments. The EPA supports enacting the architectural coating

rule as quickly as possible, but the EPA must balance the

environmental benefits with the impacts on regulated entities.

The EPA has determined that the 12-month compliance period best

achieves this balance.

2.2.5.2 Small Business Compliance Time Extension

Comment: The EPA requested comments on an extended

compliance date for small businesses and importers in the

proposal preamble (61 FR 32732). Thirteen commenters

(IV-D-02/IV-D-77/IV-F-01e/IV-D-08/IV-D-28, IV-D-34, IV-D-43,

IV-D-120, IV-D-161/IV-F-01j, IV-D-184, IV-D-189/IV-F-01o,

IV-D-226, IV-F-01k, IV-F-02gen) commented on the inclusion of a

compliance extension for small businesses. Of these thirteen

commenters, one-third of the commenters supported such an

extension while two-thirds of the commenters opposed an

extension. 

Four commenters (IV-D-02, IV-D-08, IV-D-120, IV-F-02gen)

supported a compliance extension for small business. One

commenter (IV-D-08) suggested that the EPA grant a compliance
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extension for all small businesses because of the economic

hardship that an unreasonable implementation period would impose

on small businesses. Another commenter (IV-D-08) explained that

the cost to change products may force small companies to

implement changes over a longer period of time. One commenter

(IV-F-02gen) requested a 1-year phase-in of the rule for small

businesses and supported the small business compliance extension

from the draft rule. The commenters indicated that the

compliance date extension addressed small business hardship

simply and more effectively than the variance provision.

Two of these commenters (IV-D-120, IV-F-02gen) implied that

large manufacturers have a competitive advantage and that extra

compliance time would allow small businesses to come into

compliance with the regulation gradually. One of the commenters

(IV-D-120) pointed out that several large companies were involved

with the negotiations of the proposed rule and, therefore, had a

longer time to prepare for compliance than small companies who

were unaware of the proposed rule. 

One commenter (IV-D-02) stated that it would be impossible

for a small business with multiple product lines to reformulate

by the proposed date for compliance. The commenter (IV-D-02)

referred to the presentation made to the Regulatory Negotiation

Committee (also referenced by commenters IV-D-170/IV-F-02p,

IV-F-02e, IV-F-01(l)) that suggested that 2 to 3 scientist years

or an elapsed time of 1.5 to 5.5 years was necessary to develop a

new product. The commenter (IV-D-02) also referenced his

Regulatory Negotiation presentation that discussed the

reformulation costs to small companies. The commenter (IV-D-02)

explained that small businesses produce more niche, high VOC

content paints because they cannot compete on water-based

formulas with the big companies which have greater purchasing

power and larger production capabilities. The commenter

(IV-D-02) stated that small businesses face the same

reformulation time requirements as large companies but large

companies have a competitive advantage because they typically

have fewer products to reformulate and more staff. Given the
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time and staff limitations, small businesses must choose which

products to reformulate and let competitors reformulate remaining

products. The commenter concluded that a small company with

marginal finances that loses several products might close.

Nine commenters (IV-D-28, IV-D-34, IV-D-43,

IV-D-161/IV-F-01j, IV-D-184, IV-D-189/IV-F-01(o), IV-D-226,

IV-F-01k, IV-F-02gen) opposed a compliance extension for small

businesses. Two of the nine commenters (IV-D-189/IV-F-01o,

IV-D-226) explained that a small business extension is

unnecessary because of the proposed coating categories, small

volume exemption, and the variance provision. The commenter thus

suggested that these mechanisms already provided small businesses

with ample flexibility that negated any concerns about the

compliance period. One commenter (IV-D-189/IV-F-01o) supported

the variance provision if small businesses required longer to

comply with the VOC content limits for specific categories and

stated that the promulgation delay renders the small business

compliance extension unnecessary. 

Another commenter (IV-D-28), who supported 6 months

compliance time for all businesses, explained that granting a

compliance extension to small businesses would make compliant

products non-competitive, plus the targeted VOC reductions for

State Implementation Plans (SIPs) would not be accomplished. The

commenter also pointed out that small businesses should already

be in the market if the limits represent best available controls

products and technologies, thus, the compliance extension is

unnecessary. Another commenter (IV-D-161) stated that there was

no basis to provide additional time to small businesses and

supported the exceedance fee as a mechanism to extend compliance

to all businesses. One commenter (IV-D-43) disagreed with a

small business exemption because joint ventures, subsidiaries,

etc., blur the lines between small and large companies. 

One commenter (IV-D-28) contended that the EPA would be

contradicting itself to say the rule was based on best available

control while extending compliance for one group if the

technology is already available. Two commenters (IV-F-02gen,
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IV-F-01k) agreed that if the rule contained reasonable

requirements there would be no need for special treatment of

small businesses. Two commenters (IV-D-28, IV-D-184) stated that

the compliance extension would lessen emission reductions. Two

commenters (IV-D-34, IV-D-28) contended that a compliance

extension for small businesses would give them an unfair

competitive advantage. Three commenters (IV-D-161, IV-D-28,

IV-D-43) agreed that small companies have had adequate time to

reformulate and raw material suppliers often help small

businesses reformulate. Two commenters (IV-D-34, IV-D-161)

pointed out that many small businesses who requested a compliance

extension for small businesses have already complied with State

and county regulations that gave less lead time and contained no

small business extension or variance provision. Another

commenter (IV-F-01j) stated it is more appropriate to have one

rule effective date rather than stagger the effective date based

on the size of the business.

Response: At proposal the EPA requested comment on whether

the final rule should include a small business compliance

extension (61 FR 32732). In effect, this extension would have

allowed small businesses 12 months to comply. Two-thirds of the

commenters providing comments on this provision were against

special treatment for small businesses. The primary concerns

were that such a provision would result in unnecessary adverse

environmental impacts, would potentially hurt sale of compliant

products, thereby, discouraging their development, and would

provide small businesses with an unfair advantage in the

marketplace. The EPA generally agrees with these concerns and

therefore believes that it is inappropriate to provide small

businesses with a different compliance period, in light of other

mechanisms in the rule that assist them in achieving compliance. 

Nevertheless, the comments have indicated that a longer

compliance period is appropriate for all businesses. After

careful evaluation of the comments the EPA has decided not to

include a compliance extension specific to small businesses, but

has instead lengthened the compliance period for all regulated
2-256

entities to 12 months. This time period was selected to balance

the needs of the regulated entities, both large and small

businesses, against the need for rapid implementation of the rule

to achieve the required reductions of VOC.

2.2.6 Labeling, Recordkeeping and Reporting

2.2.6.1 Labeling

General. 

Comment: Several commenters (IV-D-30, IV-D-43, IV-D-121,

IV-D-129, IV-D-153, IV-D-161, IV-D-181, IV-D-189, IV-F-2gen)

provided general comments on the labeling requirements in

§ 59.403 of the proposed rule and on the potential labeling

requirements discussed in section II.E. of the proposed preamble. 

One commenter (IV-D-181) generally supported the proposed

labeling requirements. One commenter (IV-D-161) stated that

labeling requirements that are well established in State and

local regulations should not be difficult for manufacturers to

follow. The commenter stated that new labeling requirements

would require several years of lead time to implement. 

Therefore, the commenter requested that the EPA limit labeling

requirements to those found in State and local regulations. One

commenter (IV-F-2gen) indicated that the labeling requirements

would force them to develop new labels, therefore adding expense

to their operating costs. Another commenter (IV-D-121)

representing the Department of Defense (DoD) argued that if

internal DoD repackaging, distribution, and hazardous material

exchange centers are not excluded from the definitions of

manufacturer and importer (see comment 2.2.1.1), additional

unnecessary labeling would result.

Two commenters (IV-D-43, IV-D-153) stated that current

labeling requirements already fill the lids of most coatings, and

any additional labeling would damage proper labeling and

marketing. One commenter (IV-D-129) stated that the rule's

on-can labeling requirements are too inflexible, and that

manufacturers should have the flexibility to display the

information on the can or on an accompanying product use

instruction pamphlet. One commenter (IV-D-189) stated that the
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labeling requirements of the rule are potentially the most costly

and burdensome features of the rule. Specifically, the commenter

stated that if consumer education and coverage labeling are

required, manufacturers of architectural coatings products will

be forced to redesign and reprint labels for the coatings. The

commenter stressed that even the requirements in § 59.403(a)(1)

to (3) will severely affect those companies that do not have

prior experience with regulations. The commenter stated that the

longer time the industry is allowed to implement label changes

the more cost-effectively the changes can be made. The commenter

stated that at a minimum the industry will need 1 year from the

promulgation of the rule to convert their labels. 

Several commenters (IV-F-2gen) asked how the labeling

requirements in the proposed rule would affect their labeling

requirements under FIFRA. One commenter (IV-D-28) recommended

that label requirements mandate metric (g/l) and non-metric

standard (lbs/gal) so that consumers can easily understand the

measurements. Another commenter (IV-F-01s) inquired how to label

products for a designated use. The commenter specifically asked

about labeling products for application to wood furniture instead

of application to architectural surfaces. 

Response: The EPA acknowledges that the rule may require

manufacturers to develop new labels to comply. To minimize this

impact, the labeling requirements in the final rule are based on

requirements found in existing State and local regulations. The

EPA has elected not to require consumer education and coverage

information in the final rule. As requested by commenters, the

EPA has selected labeling requirements that require limited label

space. Labeling information is required on product labels

instead of product literature in order to effectively communicate

the information with consumers and to provide for effective

compliance checks. Manufacturers cannot always ensure that their

associated product literature is distributed to consumers. In

order to minimize the impact of the labeling requirements, the

EPA has not adopted the suggestion that labels present both

metric and English units. The manufacturer or importer is only
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required to provide the VOC content in metric units. A

manufacturer or importer may also provide information on the VOC

content in English units if they choose to do so. The EPA has

not specified how products should be labeled for a designated

use. However, any coating represented by the manufacturer or

importer as an architectural coating must comply with the

architectural coating rule. Also, architectural coatings that

are registered with the EPA under FIFRA must comply with FIFRA. 

The EPA has provided an 18-month compliance period for regulated

entities to accommodate the FIFRA re-registration process. 

Consumers who repackage coatings by transferring it to another

container without altering the coating VOC content (e.g.,DoD inhouse repackaging, distribution, and hazardous materials exchange

centers) are excluded from the definitions of manufacturer and

importer and, thus, are not subject to the labeling requirements

of this rule provided they do not sell or distribute the coating

to another party.

Date of manufacture or code.

Comment. Six commenters (IV-D-28, IV-D-161, IV-D-171,

IV-D-181, IV-D-189, IV-F-02gen) provided comments on the proposed

date code labeling requirement. Three commenters (IV-D-28,

IV-D-161/IV-F-02j, IV-D-171) requested that the date code in

locations on the can other than the lid. One commenter (IV-D-28)

proposed that the EPA require manufacturers to provide

manufacturing codes on the bottom of coating cans instead of

exclusively on lids, because end-users tend to discard the lids,

making it difficult to reconstruct a product's history. One

commenter (IV-D-161/IV-F-02j) supported allowing the date code on

the label, as required in several existing State regulations. 

One commenter (IV-D-189) mentioned that the manufacture date

is already carried on a majority of architectural coating labels

or containers. One commenter (IV-F-2) inquired as to who must

understand the code on the product that indicates the date of

manufacture. The commenter indicated that they use sequential

batch numbers and would have to indicate that batches above "X"

are after the compliance date. 
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Response: In order to provide greater compliance

flexibility and reduce labeling compliance costs, the EPA has

modified the labeling requirement to allow manufacturers and

importers to place the date the coating was manufactured or a

code representing the date on the bottom of the can in addition

to allowing placement on the label or lid. The rule requires

manufacturers and importers to describe the date code in their

initial report to the EPA and update the descriptions within

30 days of modification. Thus, manufacturers and importers may

continue to use their own chosen method of denoting the date of

manufacture, but they must inform the EPA of the method to

interpret such information. The date code description will be

used by the EPA enforcement personnel to determine the compliance

status of coatings.

VOC content limit.

Comment: Fifteen commenters (IV-D-02, IV-D-30, IV-D-28,

IV-D-33, IV-D-129, IV-D-134, IV-D-137, IV-D-158, IV-D-161,

IV-D-162, IV-D-181, IV-D-183, IV-F-01k, IV-F-01n, IV-F-01i)

provided comments on the maximum VOC content labeling requirement

in §59.403(a)(3) of the proposed rule. Two of the 14 commenters

(IV-D-28, IV-D-33) requested clarification on language and

interpretation, two commenters (IV-D-02, IV-D-134) favored

requiring the actual VOC content on labels, and two commenters

(IV-D-161, IV-D-181) supported labeling the maximum VOC content

instead of the actual or measured VOC content. Three commenters

(IV-D-137, IV-D-158, IV-D-162) suggested including a general VOC

labeling statement and three commenters (IV-D-183, IV-F-01k,

IV-F-01n) opposed any VOC labeling requirement. In addition,

three commenters (IV-D-28, IV-D-30, IV-F-1i) requested

clarification for labeling units with an overpack and

multi-component systems.

Two commenters (IV-D-28, IV-D-33) asked the EPA to clarify

the meaning of maximum VOC content. One commenter (IV-D-33)

explained that the proposed regulatory language for the labeling

requirement could be interpreted to refer to either the actual

VOC content or the regulatory limit for the coatings. 
2-260

Two commenters (IV-D-02, IV-D-134) supported an actual VOC

content labeling requirement instead of the maximum VOC content

labeling required in the proposed rule. One of the commenters

(IV-D-134) explained that many stationary source coating users

and industrial facilities are required to report emissions for

emission inventories. The commenter stated that if labels only

provide the maximum VOC content, emissions inventories would be

overestimated and result in increased emission fees. The other

commenter (IV-D-02) supported an actual VOC content labeling

requirement without regard to thinning recommendations. The

commenter explained that the maximum VOC content varies with

applicators, application method, and seasonality. 

Two commenters (IV-D-161, IV-D-181) supported maximum VOC

content labeling and opposed actual VOC content labeling. One

commenter (IV-D-161) supported the requirement of a maximum VOC

content labeling to avoid the cost for new labels. The commenter

explained that because VOC measurements would vary by lab,

including actual VOC content as measured would increase labeling

costs. The other commenter (IV-D-181) stated that it would be

impossible to comply with an actual VOC content labeling

requirement because labels printed in advance would not account

for the variability in production runs. One of the commenters

(IV-D-183) explained that this labeling requirement serves little

purpose because the general public does not understand the VOC

content terminology. Another commenter (IV-F-01k) also

questioned the need for VOC labeling because it is expensive and

provides little information to consumers. If the provision is

included, the commenter requested clarification that maximum VOC

content is required rather than actual VOC content. The other

commenter (IV-F-01n) claimed that the labeling would be

untruthful because Method 24 overestimates the VOC content of

waterborne coatings.

Three commenters (IV-D-137, IV-D-158, IV-D-162) suggested

that the EPA allow general VOC content labeling statements rather

than the specific, maximum VOC content of coatings in the

container. One commenter (IV-D-158) suggested that labels read
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“contains no more than X g/l VOC” because the requirement for

specifying the VOC content of the coating in the container, or

the actual VOC content, presents a hardship to manufacturers. 

The commenter explained that existing State regulations allow

this type of generic VOC content labeling. One commenter

(IV-D-162) suggested a general statement that the product meets

Federal and State regulations. One commenter (IV-D-137)

suggested the following statement “this product complies with VOC

content limits for the area in which it is sold.” 

In addition, two commenters (IV-D-28, IV-F-1i) requested

clarification for VOC content labeling of multi-component

systems. One commenter (IV-F-1i) discussed coatings provided in

two separate packages that must be mixed before application. 

According to the commenter, these coatings commonly have

different VOC contents and one coating is compliant and the other

one is not. The commenter indicated that these coatings cannot

be premixed at the factory and retain their performance

characteristics. Another commenter (IV-D-30) asked for

clarification of the labeling requirements for multiple small

units contained within a larger "overpack" carton.

Response: The EPA has carefully considered these comments

and has decided to modify the labeling requirements. To provide

flexibility, in § 59.405(a)(3) of the final rule, the EPA allows

either of the following to be included on the label of the

coating container: (1) the VOC content of the coating in the

container; or (2) the VOC content limit in table 1 of the rule

with which the coating is required to comply and does comply. 

Regarding the request for more general VOC labeling statements,

the EPA maintains that labels specifying the VOC content or the

required VOC content limit with which the coating complies are

essential for compliance enforcement. The EPA agrees that

compliance with an actual VOC content labeling requirement may be

difficult due to variability of VOC contents resulting from

production fluctuations. Therefore, § 59.405(a)(3) of the final

rule permits manufacturers to comply by labeling the coating with

either the VOC content of the coating including thinning
2-262

recommendations, except thinning with water, and considering

production fluctuations or the applicable VOC content limit for

the coating as listed in table 1 of the rule, provided that the

VOC content of the coating does not exceed the VOC content limit. 

Any coating for which the exceedance fee or tonnage exemption

provision is being used must be labeled with its actual VOC

content rather than the VOC content limit in the rule because it

would not be in compliance with the limit. With regard to

multi-component products, two or more component systems must be

labeled with either the VOC content of the coating as mixed per

the manufacturer’s instructions or the applicable VOC content

limit to comply as directed with mixing instructions. For

multiple units packaged together that are not mixed, the smallest

unit sold individually must meet labeling requirements.

Coverage.

Comment: In the proposal preamble (61 FR 32733), the EPA

requested comment on the feasibility of a coating coverage

labeling requirement. Eight commenters (IV-D-43, IV-D-120,

IV-D-161, IV-D-162, IV-D-181, IV-D-207, IV-F-1g, IV-F-1k) opposed

requiring coverage information on container labels. The

commenters stated that there is no standard method for

determining coating coverage and that coating coverage is highly

variable depending on the following factors:

& Application technique: spray, roller, brush, etc.

& Nature of the substrate: absorbency, color,

temperature, fineness of sanding, presence of existing

coatings (if any), etc.

& Nature of the coating: hiding power, color, rheology,

etc.

& Environmental conditions during application:

temperature, humidity, etc.

& Coating requirements: film thickness required (depends

on long-term exposure requirements), etc.

One commenter (IV-D-207) stated that coating coverage can vary by

a factor of 2 to 3 times depending on these variables. The EPA

agrees that coating coverage information may be useful for
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consumers, but other commenters have clearly indicated that it is

an inappropriate factor for assessment of VOC emissions limits. 

In contrast, one commenter (IV-F-1i) stated that its label

already includes maximum VOC content, thinning instructions,

warnings, coverage information, and a manufacturing date code on

its label. Eight commenters (IV-D-28, IV-D-153, IV-D-161,

IV-D-162, IV-D-181, IV-D-207, IV-F-1i, IV-F-1k) explained that

the coverage rate depends on the substrate and other variable

conditions. Commenters mentioned many variables that affect

coverage, including application surface, humidity, temperature,

and other exposure conditions. Commenters agreed that specifying

coverage rates would not be useful because the actual coverage

rate varies with application technique and product use. 

One commenter (IV-D-207) explained that a coverage statement

offers little benefit but could result in considerable cost to

industry and the EPA. According to the commenter, testing to

generate coverage rates for each product would be costly for

small companies. One commenter (IV-D-181) pointed out that

consumers would not make purchasing decisions based on coverage

rates. Two commenters (IV-D-28, IV-D-153) stated that coverage

information would confuse consumers. Three commenters (IV-D-181,

IV-F-01, IV-F-01k) stated that coverage information would require

too much label space. Another commenter (IV-D-162) suggested

that coverage information should not be required for industrial

maintenance coatings.

Four commenters (IV-D-43, IV-D-120, IV-D-207, IV-F-01k)

pointed out that the regulation must establish how coverage is to

be measured to ensure that coverage information is meaningful. 

Another commenter (IV-D-120) stated that regulating coverage rate

without specifying a standard method creates an “uneven playing

field” because the test method selected affects results. 

Specifically, one commenter (IV-F-01k) suggested specifying the

opacity level. Another commenter (IV-D-43) stated that

specifying a coating thickness would be difficult to understand. 

Response: The EPA acknowledges that coverage rates vary

according to substrate surface, coating formulation,
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environmental conditions and application technique. The EPA also

agrees that standardized test methods would be necessary to

ensure comparable results. Although coating coverage rates would

provide valuable information to consumers, the information is not

necessary to determine compliance. Thus, a coating coverage

labeling requirement has not been included in the final rule.

Industrial maintenance coatings. 

Comment: Thirteen comments were received on the “not

intended for residential use” labeling requirement for industrial

maintenance coatings in §59.403(b) of the proposed rule. Four

commenters (IV-D-158, IV-D-183, IV-F-01k, IV-F-02b) suggested

removing the proposed labeling requirement for industrial

maintenance coatings from the rule. One commenter (IV-D-01k)

contended that the words would confuse consumers. According to

one commenter (IV-F-01k), the requirement is of little value

because many companies already have similar phrases on labels and

the commenter stated that the proposed rule allowed for the

availability of quality products for residential use. 

Four commenters (IV-D-101, IV-D-161, IV-D-183, IV-D-189/

IV-F-01o) pointed out that there may be instances where an

industrial maintenance coating is appropriate in a residential

setting rendering the label statement incorrect. One commenter

(IV-D-189/IV-F-01o) explained that the “not intended for

residential use” labeling requirement would mislead consumers and

result in decreased product use in legitimate settings. 

Seven commenters (IV-D-21, IV-D-129, IV-D-161, IV-D-162,

IV-F-02gen, IV-F-02b, IV-F-02c) requested more flexibility for

the language used to meet this labeling requirement. Several

commenters (IV-D-129, IV-D-162, IV-F-02gen, IV-F-02c) suggested

that the EPA allow alternate language such as “for industrial use

only,” which is standard industry practice. One commenter

(IV-D-129) pointed out that changing the language they already

have on their labels would require unnecessary expense. One

commenter (IV-F-02b) noted that the requirement is not in the

California rule 1113 and suggested that the labeling statement,

if required, list performance criteria rather than location of
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use. Some commenters (IV-F-02gen) offered the following

suggestion: “this product is intended for use under the

following conditions (list conditions)” and “for professional use

only.” One commenter (IV-D-21) also suggested “for professional

use only” because industrial products are used in residential

homes. One commenter (IV-D-161) who originally opposed the

requirement later suggested that manufacturers be allowed to

choose between the language in the California regulations and the

language required by the proposed rule. The commenter explained

that the California Air Resources Board adopted a suggested

control measure for architectural coatings that requires labels

to include the statements “not for residential use” or “not for

residential use in California.” 

Response: The EPA has retained in the final rule a special

proposed labeling requirement for industrial maintenance

coatings. The EPA believes that this requirement will reduce the

use of higher VOC content coatings in inappropriate

circumstances. However, as requested by commenters, the EPA has

allowed greater flexibility in the language of the labeling

requirement in order to reduce the burden on industry while still

accomplishing the goal of discouraging use of coatings in

inappropriate locations. The final rule allows any of the

following phrases: 

1. For industrial use only;

2. For professional use only; 

3. Not for residential use; 

4. Not intended for residential use; and/or 

5. This product is intended for use under the following

conditions (list those that are applicable):

A. Immersion in water, wastewater, or chemical

solutions (aqueous and nonaqueous solutions), or

chronic exposure of interior surfaces to moisture

condensation;

B. Acute or chronic exposure to corrosive, caustic,

or acid agents, or to chemicals, chemical fumes,

or chemical mixtures or solutions;
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C. Repeated exposure to temperatures above 120 Co

(250 F); o

D. Repeated (frequent) heavy abrasion, including

mechanical wear and repeated (frequent) scrubbing

with industrial solvents, cleaners, or scouring

agents; or 

E. Exterior exposure of metal structures and

structural components. 

The EPA believes that the conditions under which industrial

maintenance coatings are used are found infrequently in

residential settings. However, the EPA does not intend to

prohibit industrial maintenance coating use in residential

settings, as indicated by the wording of the labeling statement

described above.

Educational statement.

Comment: In the proposal preamble (61 FR 32733), the EPA

requested comment on the use of an educational statement rather

than an educational outreach program. Fourteen comments were

received in regard to the EPA's request for comments in the

proposal preamble (61 FR 32733 1st column) on the potential

impact of labels intended to inform consumers about VOC and their

emissions from coatings. Eleven (IV-D-28, IV-D-43, IV-D-129,

IV-D-151, IV-D-153, IV-D-161, IV-D-162, IV-D-181, IV-D-207,

IV-D-213, IV-F-01i) of the 14 comments received opposed an

educational statement. Two comment letters (IV-D-33, IV-D-120)

supported an educational statement, and two comment letters

(IV-D-151, IV-D-189) recommended an educational outreach program. 

Of the eleven commenters who opposed the educational

labeling statement, two commenters believed an educational

statement would influence consumer decisions and four commenters

believed the statement would have little effect. Two of the

eleven commenters (IV-D-213, IV-F-01f) stated that an educational

statement or an outreach effort would encourage the use of

coatings based on VOC content instead of product quality. 

One commenter (IV-D-213) representing 3,000 painting

contractors contended that consumers would select poor quality
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coatings and apply them more frequently if low VOC content was

their sole purchasing criterion. According to the commenter,

this undermines the basic market incentive of making the best

product for specific purposes and selling it at a competitive

price. The commenter added that an accurate information piece

would describe the potential link between VOC emissions and

possible ozone formation, and that issues such as temperature,

humidity, and reactivity would need to be discussed. 

Four commenters (IV-D-28, IV-D-129, IV-D-153, IV-D-207)

opposed the EPA's proposal to add an educational statement on the

coating's label, because they claimed that it would produce

little or no effect upon the end user's actions. One commenter

(IV-D-207) explained that professional painting contractors would

choose coatings based on the product's performance and its

cost-benefit relationship. The commenter believed that

do-it-yourself users would either ignore the statement or delay

maintenance to avoid feeling guilty for harming the environment. 

One commenter (IV-D-181) stated that it would be difficult

to find space on the label because the containers have a limited

surface area and must contain required safety warnings

(flammability, risk to infants), application instructions, and

other commercial information. Second, the commenter did not

believe the proposed messages should be included because the

statute supposedly does not contemplate such labeling and a

statement could not convey the complicated nature of ozone

formation. 

Two other commenters (IV-D-151, IV-F-1i) opposed an

educational statement because they believe it would be a

fruitless and costly effort. One commenter (IV-D-43) advised

against additional labeling aimed at educating the public,

because the public either already understands the environmental

impacts associated with VOC, or will be safeguarded by upcoming

VOC legislation that will control the products available to the

consumer. One commenter (IV-D-129) recommended that an

alternative to the proposed educational labeling requirement

might be to require the following label: "Volatile Organic
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Compounds in this product may contribute to ground-level smog. 

Call 1-800 ___-____ for additional information." The commenter

suggested that the EPA could reference a hotline dedicated to

clean air education. One commenter (V-D-161) opposed an

educational statement regarding VOC impact to the environment

because it would be too costly, too large for the container,

would not result in a significantly better educated consumer, and

could cause the consumer additional confusion. Another commenter

(IV-D-162) opposed requiring an educational label because the

company already provides information to facility owners,

specifiers and applicators, and expects to increase efforts when

the rule is finalized and implemented. 

Of the two commenters (IV-D-33, IV-D-120) who supported an

educational labeling requirement, one commenter (IV-D-33)

recommended the following less technical and simplified

description: "This coating contains solvents that will be

emitted to the air during use, and may contribute to the

formation of summertime smog that is harmful to people's lungs." 

The other commenter (IV-D-120) preferred a succinct labeling

statement because an outreach program based exclusively on

architectural coatings, as opposed to the entire VOC-emitting and

ozone-forming community, would create a bias against the coatings

industry, and leave the public misinformed as to the larger

picture of other contributing emission sources. In comparison,

two commenters (IV-D-151, IV-D-189) supported an outreach program

instead of an educational labeling requirement. 

Response: After careful consideration of the comments, the

EPA has not included an educational labeling requirement in the

final rule. The EPA acknowledges that an educational labeling

statement would need to be lengthy to address all the relevant

information and may not adequately educate consumers on the

relationship between VOC and ozone. As discussed in section 2.8,

the EPA will instead consider an educational outreach program.

2.2.6.2 Recordkeeping and Reporting 

Comment: Nine commenters (IV-D-28, IV-D-33, IV-D-101,

IV-D-161, IV-F-01, IV-F-01a, IV-F-01(l), IV-F-01b, IV-F-02)
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offered feedback on recordkeeping and reporting requirements in

the proposed rule. Three commenters (IV-D-28, IV-D-33, IV-F-01a)

suggested expanded reporting requirements and two commenters

(IV-F-01b, IV-F-02) requested reduced reporting. Two commenters

(IV-D-161, IV-F-01) reminded the EPA to correct dates and one

commenter (IV-F-01(l)) stated that it was impossible to list

products by category (a proposal requirement for the initial

notification report).

Of the three commenters requesting increased reporting

requirements, one commenter (IV-D-28) suggested requiring yearly

reporting and certification requirements but did not elaborate on

the specifics of such reports. The commenter (IV-D-28) also

requested that the EPA provide an address to which manufacturers

would send descriptions of their manufacturing code. The other

two commenters supporting increased reporting (IV-D-33, IV-F-01a)

recommended that the EPA revise the reporting requirements so

manufacturers would submit VOC content and coating thinning

information on their products a one-time initial basis. This

would allow the EPA to detect any regulatory misinterpretations

by the manufacturer regarding the proper categorization of the

coatings, etc.

Two commenters (IV-F-01b, IV-F-02) requested minimal

reporting requirements. One (IV-F-01b) of the commenters

suggested that recordkeeping and reporting requirements be held

to gross IRS type reports, with records being kept by

manufacturers and supplied on request. The commenter stated that

this is especially appropriate for the exceedance fee option,

low-volume exemption, and the recycled coatings provision. The

other commenter (IV-F-2) stated that his company does not have

the staff or financial resources to do reporting and

recordkeeping. The commenter claimed that it would cost his

company more to meet the reporting and recordkeeping requirements

than it would to reformulate coatings. 

Two commenters (IV-D-161, IV-F-01) commented on the required

reporting dates. One commenter (IV-D-161) stated that the

reporting requirements must reflect the new effective date for
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the rule. One commenter (IV-F-01) pointed out that the preamble

requires an initial report "by April 1, 1997 or within 180 days

after becoming subject to the requirements of the proposed

standard, whichever is later." The commenter noted that no one

becomes subject to the proposed standard before April 1, 1997 so,

in effect, it says 180 days later. 

One commenter (IV-F-01(l)) asserted that it is difficult or

impossible to report by product category because the actual end

use of a coating is not known by the regulated entity. The

commenter stated that the same coating may be marketed for

several categories, including categories other than architectural

coatings. The end-use category is often not known until sold to

the end user. Another commenter (IV-F-2) inquired whether

manufacturers must notify the EPA if they begin making a coating

in a different category after submitting the initial report. 

One commenter (IV-D-101) requested that the EPA answer the

following questions with regard to reporting: 

1. Why are manufacturers being required to report a list

of categories that are manufactured?

2. If a new coating in a new category is introduced after

adoption of the rule, would a report be due for the

product, and if so, what would be the report's content? 

3. Does the EPA plan to require annual reporting? If so,

discuss the reasons for the requirement.

Response: The EPA understands the concerns of regulated

entities regarding the potential burden of extensive

recordkeeping, especially for those regulated entities that will

act in good faith to comply with the final rule. Nevertheless,

the EPA must have mechanisms to allow proper determination of

compliance to insure that the final rule achieves the intended

VOC reductions. The EPA believes that the final rule

requirements for an initial report and container labeling

represent the appropriate balance between burden and information

needed for enforcement. The EPA did not adopt the suggestion

that the EPA require yearly reporting and certification due to
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the burden associated with such a requirement, particularly for

small businesses. The EPA believes that the recordkeeping and

reporting requirements in the final rule are the minimum that can

still meet the needs for adequate determination of compliance

and, if necessary, enforcement.

Manufacturers and importers are required to submit in their

initial notification report a list of the coating categories they

produce to provide the EPA with an initial overview of all

manufacturers and importers subject to the standards. For this

report, manufacturers and importers must associate coatings with

the categories and VOC content limits with which they must

comply. To determine which category a coating is in, the rule's

definition of the category should be compared to the

manufacturer’s or importer's representation of its intended use. 

Manufacturers and importers who begin to sell or distribute new

coatings after the rule takes effect and who have already

submitted an initial notification report do not have any

additional notification requirements. However, a manufacturer or

importer who begins to sell or distribute a coating subject to

the rule and who has not previously submitted an initial

notification report must submit one within 180 days after the

coating is manufactured or imported or by the compliance date of

the rule, whichever is later. 

Regarding the commenters’ request to clarify the date the

initial report must be submitted, manufacturers that currently

produce coatings subject to the rule are required to submit the

initial report by the compliance date of the final rule. 

Manufacturers of new coatings must submit the initial report

within 180 days after becoming subject to the rule or by the

compliance date, whichever is later. Manufacturers that have

already submitted an initial report are not required to report

new coatings. The final rule has been revised to clarify the

appropriate compliance dates and report submittal dates. With

regard to the request that the EPA provide an address for

submitting information such as the manufacturing code, § 59.409

of the final rule provides addresses of the Regional Offices of
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the EPA. Submittals of all reports required by the rule as well

as exceedance fee payments should be sent to the EPA Regional

Office which serves the State or territory in which the corporate

headquarters of the manufacturer or importer resides.

2.2.7 Determination of Volatile Organic Compound Content

Comment: One commenter (IV-D-02) stated that the EPA failed

to use a method to relate emissions to area covered such as one

that was proposed during the architectural coatings regulatory

negotiation. 

Response: As discussed in section 2.2.6.1 of this document

the EPA agrees with commenters that it is very difficult to

relate coating emissions to the area covered due to the great

amount of variability associated with the coverage of coatings. 

An attempt at such an exercise would not be productive for

architectural coatings due to the large variety of coatings and

conditions under which they are applied. 

Comment: Four commenters (IV-D-20, IV-D-73, IV-F-1b,

IV-F-2) opposed calculating VOC content levels for waterbased

formulations on a “less water” basis. One commenter (IV-F-2)

questioned whether using the less water basis had any positive

impact because it negates the desirable practice of adding water

to the coating. Two commenters (IV-D-20, IV-D-73) noted that

using a “less water” basis dramatically increases the gram per

liter VOC content. One of these commenters (IV-D-20) explained

that many formulations depend on water as part of their

formulation (e.g., increased coating transparency with faux

finishing and glazing compounds). The commenter expressed

concern that deriving VOC calculations that ignore water content

would reduce the incentive to use waterbased formulas and thus,

increase the incentive to use solventborne formulas. The

commenter specifically requested that VOC content for the “faux

finishing/glazing” category be assigned on a formula basis

including water. Another commenter (IV-F-1b) stated that

architectural coating manufacturers were being treated unfairly

compared to consumer product manufacturers because architectural
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coating manufacturers must subtract water from their formulations

before determining VOC content.

Response: The architectural coating rule's requirement to

measure VOC on a less water basis is consistent with other EPA

rules and guidance documents for determining VOC content of

coatings. This approach relates the mass of VOC emitted to the

volume of VOC and solids in the coating. The EPA believes that

calculating VOC on a less water basis does not make water-based

coatings less attractive nor does it promote using solventborne

coatings. It does, however, provide a fair means of comparing

the VOC content of coatings in relation to their solids content,

and thus, their coverage and emissions potential.

Comment: One commenter (IV-F-2) stated that coatings need

solvent to float the resins, but solvent is not required for

pigments and extenders. The commenter expressed concern that

manufacturers may overload coatings with pigments and extenders

to meet the VOC content limits.

Response: The EPA does not agree that coating manufacturers

will overload coatings with pigments and extenders simply to meet

VOC content limits. First, the addition of pigments and

extenders to the coating will increase the cost of the coating

without adding value and could possibly even degrade the quality

of the coating. Second, the addition of pigments and extenders

would reduce the coverage of the paint. The EPA believes that

manufacturers will not want to risk alienating consumers by

offering them inferior products at higher prices. Therefore, the

EPA believes it is unlikely that this situation will occur.

Comment: Four commenters (IV-D-28, IV-D-71, IV-D-134,

IV-D-189) raised issues with the validity of Method 24 for

certain coatings and/or requested that the EPA allow alternatives

to the EPA Method 24 to determine compliance with the VOC content

limits. Three of the commenters (IV-D-28,IV-D-134, IV-D-189)

requested that the EPA allow alternative methods for

determination of VOC content of coatings containing acetone or

for waterborne coatings. Two of these commenters requested that

the EPA allow use of formulation data. The fourth commenter
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(IV-D-71), a State regulatory agency, requested approval of two

modifications to Method 24 for use with a traffic marking paint.

Requests for alternative to Method 24. Two commenters

(IV-D-28, IV-D-189) requested that the EPA add an alternative to

Method 24 to test acetone content and that the EPA accept

compliance demonstrations based on theoretical formula

calculations or formula batch card loading information. One

commenter (IV-D-189) was concerned that a product containing

acetone could erroneously appear out of compliance because a

reliable test method to isolate and subtract acetone as a VOC

does not exist. The other commenter (IV-D-28) also requested

that the EPA add an alternative to Method 24 to test acid

content.

Another commenter (IV-D-134) requested an alternative to

Method 24 for determining VOC content of waterborne coatings in

the rule, because according to the commenter, it tends to produce

unreliable results, leading to erroneous findings of

non-compliance in some tests. The commenter cited documentation

of erroneous test results in the aerospace industry that have

been submitted to the EPA previously.

Request for modification of Method 24 for use on a type of

traffic marking coating. One commenter (IV-D-71), a State

regulatory agency, received a request from a manufacturer to

modify Method 24, as it would be inappropriate for use with

methacrylate multicomponent traffic marking coatings. The letter

attached to the comment described the traffic marking coating,

and then requested permission to vary Method 24 in two ways. 

First, the commenter claimed that the dispersion solvent required

by Method 24 prevents chemical reactions that would normally

consume much of the coating’s VOC. Therefore, the letter

requested that the solvent be replaced with a procedure whereby a

paper clip is weighed within a metal dish, the coating is added

to the dish, and the paper clip is used to disperse the coating. 

Second, according to the commenter, testing the coating at the

specified 3 millimeter thickness hinders VOC consumption and is

uncharacteristic of the coating’s actual use. Therefore, the
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letter requested that the sample size be increased to 3.0 grams

to enable the reaction to take place and reduce the margin for

error. The letter included the following revision for testing

for the particular product:

3.7.2.1 Weigh and record the weight of an aluminum foil

weighing dish and a metal spreading device. Using a syringe

as specified in ASTM D2369-81, weigh to 1 mg, by difference,

a sample of coating into the weighing dish. For [the

requester’s coating], a suitable size is 3.0 ± 0.1 g. For

other coatings believed to have a volatile content less than

40 weight percent, a suitable size is 0.3 ± 0.10 g, but for

coatings believed to have a volatile content greater than

40 weight percent, a suitable size is 0.5 ± 0.10 g.

NOTE: If the volatile content determined pursuant to

section 5 is not in the range corresponding to the sample

size chosen repeat the test with the appropriate sample

size. Add the specimen and use the metal spreading device

to disperse the specimen over the surface of the weighing

dish. If the material forms a lump that cannot be

dispersed, discard the specimen and prepare a new one. 

Similarly, prepare a duplicate. The sample shall stand for

a minimum of 1 hour, but no more than 24 hours prior to

being oven dried at 110 (C ± 5 (C for 1 hour.

Response: The proposed rule specified that Method 24 would

be used to determine compliance with the VOC content limits. In

response to these comments, the EPA has revised the rule to

consolidate and clarify the calculation procedures and methods

for determining VOC content of coatings. Section 59.406 of the

final rule specifies that manufacturers or importers may use

either Method 24 results, formulation data, or any other

reasonable means to determine the VOC content of a coating for

their own internal purposes. Section 59.406(b) also clarifies,

however, that the EPA may require a manufacturer or importer to

conduct a Method 24 analysis and that Method 24 results will take

precedence if there are inconsistencies between Method 24 results

and any other means of determining VOC content. This change was

made to clarify that manufacturers or importers do not have to

perform a Method 24 analysis for every coating unless they choose

to do so. If they rely on formulation data or other means,

however, they do run the risk that the EPA in enforcement

actions, who may use Method 24 to confirm the VOC content, will
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find a coating to be non-compliant, even though it may appear to

be compliant based on formulation data or other means. The EPA

believes that regulated entities will have incentive to use

reasonable and accurate methods to determine VOC content without

having to perform Method 24 tests on each batch of every product.

The EPA has determined that Method 24 should take precedence

in enforcement action if Method 24 results are not consistent

with other means of determining VOC content. The EPA believes

that use of Method 24 provides consistent, reliable results when

determining the VOC content of primers, topcoats, varnishes,

lacquers, air-dried coatings, air-dried oxidizing coatings, heatcured baking systems, multi-component paint systems (waterreducible and solvent-based), water-reducible paints

(styrene-butadiene, poly(vinylacetate)-acrylic, acrylic), and

solvent-based paints. In addition, Method 24 provides a means of

ensuring that the reported VOC content based on formulation data

or other means of determining VOC content is correct. This

approach is consistent with other coating rules established by

the EPA in the past.

With regard to the comment that Method 24 is unreliable for

determining the VOC content of waterborne coatings, the EPA

contends that Method 24 is the best currently available

analytical method for determining VOC content in low solvent

content (high water content or waterborne) coatings. For

waterborne coatings, the VOC content is determined indirectly

using methods that determine nonvolatile matter content and water

content. The VOC content is assumed to be what is unaccounted

for by these two fractions. The EPA acknowledges that the

inherent imprecision of indirectly determining the VOC content of

such coatings by this method necessitates an adjustment of the

analytical results. Such adjustments must be based on confidence

limits calculated from the precision statement established for

Method 24. The precision adjustment procedure is incorporated in

Method 24. Therefore, the final rule specifies that Method 24 is

to be used for determining the VOC content of coatings subject to

the rule.
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 The EPA acknowledges that Method 24 does not currently

recommend a procedure for measuring the acetone level of a

coating. When a method for determining the acetone level of a

coating is developed and adopted by ASTM, the EPA will modify

Method 24 to incorporate this method for acetone.

In addition, §59.406(c) provides the option for the

Administrator to approve, on a case-by-case basis, alternative

methods of determining the VOC content of coatings if they are

demonstrated to the Administrator’s satisfaction to provide

results acceptable for determining compliance with the rule. 

Such alternative methods could include procedures for testing for

acetone and acid content, procedures for testing for water

content, and procedures for coatings that are chemically-cured.

Regarding the modification to Method 24 requested by the

commenter to accommodate the unique chemistry of a traffic

marking coating, the final rule includes a provision specifying

the use of this modification for traffic marking coatings.

 Comment: One commenter (IV-D-120) requested that the EPA

follow South Coast Air Quality Management District (SCAQMD) and

provide a 10 percent test margin of error to account for errors

in the Method 24 calculation. As applied, the commenter noted

that a coating with a VOC content of 400 g/l could produce a test

result of 430 g/l and still remain compliant.

Response: The EPA has not revised the rule to include

consideration of the variation of Method 24 when determining

compliance as requested by the commenter. The VOC content limits

in table 1 of the rule are established as limits, not

approximated limits. Thus, it would not be appropriate to adopt

the commenter’s suggestion to increase the standard by the

variation of the method. Manufacturers and importers should

consider the variation of the method when labeling their coatings

and assessing compliance with the rule. A study performed by

SCAQMD (IV-J-18) shows that manufacturers typically consider the

variation in determinations of compliance with a rule. 

Specifically, the SCAQMD performed a field study where they

purchased and analyzed over 30 coating samples consisting of
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various coating categories from retail outlets. The SCAQMD found

all of the analyzed coatings to be in compliance with the

applicable rule limit. Laboratory tests indicated that the

reported VOC content on the container was generally 5 to

40 percent higher than the VOC content of the coating as tested. 

Thus, the EPA believes that the 10 percent allowance requested by

the commenter is unnecessary.

Comment: One commenter (IV-D-32) urged the EPA to remove

the exemption for VOC in colorants in determining a coating’s VOC

content, because the exemption eliminates any incentive to reduce

VOC emissions from colorants and fails to reward companies that

have invested effort in developing low- and zero-VOC colorants. 

Another commenter (IV-D-34) advised the EPA to consider including

colorant in the calculation of VOC content and enforcing the

limits on base colors only, which would increase enforceability. 

The commenter noted that some manufacturers have developed lowand zero-VOC colorant systems, which are currently more

expensive. The commenter discussed data that indicate that

including colorants in the VOC calculation could result in a

20 to 300 percent increase in calculated VOC content, depending

on color coating VOC content, and colorant VOC content.

Response: The EPA would like to clarify that the proposed

rule as well as the final rule excludes only the colorants added

to tint bases at the paint store or on-site to produce the

desired color. The final rule specifies in §59.406(a) that the

VOC content of tint bases shall be determined without colorant

that is added after the tint base is manufactured or imported. 

If a colorant is included in the tint base as manufactured, it is

not excluded from the calculation of the VOC content. Because

the rule only applies to manufacturers and importers, the EPA

believes that the rule does what one commenter (IV-D-34)

suggested, i.e., include colorants in the calculation of VOC

content for base colors. The EPA did not revise the rule to

apply the limit to colorants added to tint bases because

colorants are typically added by the retailer at the retail

outlet. Because these colorants are not within the control of
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the manufacturer or importer this change would have no impact on

the VOC content of paints supplied by the manufacturer or

importer. 

2.2.8 Variance Provisions

Comment: Nine commenters (IV-D-28, IV-D-32, IV-D-34,

IV-D-58, IV-D-114, IV-D-120, IV-D-185, IV-F-1g, IV-F-1n)

supported the proposed variance provisions. Four of these

commenters (IV-D-28, IV-D-32, IV-D-185, IV-F-1n) supported

variance options for manufacturers to receive the extra

compliance time needed based on economic or technological

justification. One commenter (IV-D-58) supported the

strengthening of the variance for permanent relief in cases of

economic or technological hardship. One commenter (V-D-34)

recommended that the EPA adopt more restrictive variance

findings, and suggested incorporating findings set out in the

California Health & Safety Code, Section 42352 (attached to

comment). Another commenter (IV-D-114) supported the use of the

variance provisions because manufacturers forced to withdraw from

a market during the period of product reformulation and testing

will face additional costly and uncertain challenges of the

market.

On the other hand, 14 commenters (IV-D-16, IV-D-22, IV-D-30,

IV-D-33/IV-F-1a, IV-D-96, IV-D-118, IV-D-119, IV-D-120, IV-D-161,

IV-D-163, IV-F-1e, IV-F-1i, IV-F-1m, IV-F-2), including some

small businesses, did not support the proposed variance

provisions. One commenter (IV-D-33/IV-F-1a) based its opposition

on the opinion that the rule fails to represent technologyforcing levels of VOC control and supported a limited variance

provision for manufacturers to comply with a more stringent

second phase. Two commenters (IV-D-118, IV-D-119) stated that

granting variances without the appropriate compensation for

adverse impacts on the environment would provide no air quality

benefit and reduce the effectiveness of an already weak proposed

standard. Another commenter (IV-D-96) maintained that variance

provisions based on simply economic hardship would reduce the

effectiveness of the architectural coating rule. 
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One commenter (IV-D-16) stated that the variance procedure

did not present a reasonable option because it would impose such

a heavy administrative burden that business would choose to shut

down rather than use the variance. Another commenter (IV-F-2)

stated that the variance procedure, and the proposed public

hearing process in particular, would be very burdensome for a

small business. Another commenter (IV-D-120) stated that the

variance requirements as proposed are unduly difficult to

achieve. Instead, the commenter asserted that the variance

applicant should only need to establish that compliance would

result in economic hardship, and that the company will make a

good faith effort to come into compliance within a reasonable

time period.

One commenter (IV-D-120) stated that the variance provision

as written is not effective, in that it requires significant

expense with little or no guarantee of approval. The commenter

recommended an extended compliance period as a more effective

option to alleviate the heavy burden upon small businesses.

One commenter (IV-D-30) opposed using a variance because it

would create an uneven playing field based upon the resources of

the company seeking the variance, implying that the variance

provides no advantage to small businesses. Another commenter

(IV-F-1i) stated that applying for a variance would be a very

difficult process for most small companies because they do not

have a legal staff or a specialist staff for such a process. In

addition, according to the commenter, a variance could commit the

company to a program to achieve compliance in an area where they

do not know how to do it and if they knew how to do it, they

would not need a variance. The commenter maintained that small

businesses will avoid applying for a variance. 

One commenter (IV-F-1m) estimated a total of 4,770 products

will need to be reformulated (8.8 products per company multiplied

by 411 companies plus the amount estimated for the

1990 Architectural and Industrial Maintenance Coatings survey

population). The commenter asserted that a variance would not

provide relief because of the large number of products that will
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need to be reformulated in a short period of time. The commenter

asked how many people the EPA has on staff to handle variance

applications and if they will be able to process 2,000 variance

applications between now and the compliance date. Two other

industry commenters (IV-F-1e, IV-F-2) also expressed concern

about how the EPA would handle a large volume of product

variances.

One commenter (IV-D-161) opposed the proposed use of a

variance in the rule for several reasons: the lack of required

progress reports; the lack of provisions requiring compliance

with the schedule associated with the variance application; and

the lack of any provision to require exceedance fees for excess

emissions. The commenter proposed that the exceedance fee

concept be used in place of the variance proposal.

One commenter (IV-D-163) supported the use of market-based

mechanisms to provide flexibility to manufacturers that are

unable to reformulate their coatings before the April 1, 1997

compliance date. The commenter claimed that the use of

exceedance fees and purchase of emission reduction credits (ERC)

are options that the EPA should include in the rule, rather than

a variance.

Several industry representatives (IV-F-2) asked what type of

testimony would be required at the compliance variance hearing

and how a manufacturer could demonstrate public benefit. One

industry representative (IV-F-2) asked whether there would be a

fee for the variance, how the location of the hearing would be

determined, and whether the variance would be granted on a

company basis or on a coating basis. Another commenter (IV-F-2)

asked whether both the variance provision and exceedance fee

option would be included in the rule and, if so, why.

Response: The EPA has concluded that the proposed variance

procedure would be unworkable and ineffective to accomplish the

goals intended by the EPA. The proposed variance provision would

have allowed manufacturers and importers of architectural

coatings to submit a written application to the Administrator

requesting a variance if, for reasons beyond their reasonable
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control, they could not comply with the requirements of the

proposed rule. In particular, the proposed variance provision

allowed additional compliance time and was developed especially

for small businesses. In the proposal preamble (61 FR 32743),

the EPA requested comments from small businesses on their

expected use of the proposed variance provision, as well as other

proposed provisions. 

Based upon the comments received, it is evident that the

variance provision may not provide the intended compliance

flexibility, especially for small businesses. Even though the

proposed variance requirements were intended to be the minimum

necessary to approve a coating variance, the EPA recognizes that

the requirements may be burdensome, particularly for small

businesses with limited or no regulatory compliance staff. The

EPA agrees that it is also possible that the variance provision

could create an uneven playing field because small businesses

would not have the resources needed to pursue this option,

thereby putting smaller businesses at a disadvantage compared to

larger businesses. Also, as one commenter pointed out, even with

the investment of time and money, the EPA cannot guarantee

approval of the variance application. In addition, review and

approval of several thousand variance applications would place a

heavy burden on the EPA’s staff and the potential delays in

processing variances would be disadvantageous to the regulated

entities. Therefore, the EPA has decided not to include the

variance provision in the final rule. 

Nevertheless, the EPA believes that there is a need for

additional compliance flexibility and, therefore, has

incorporated other provisions, more suitable for this industry

than variances, into the final rule. The EPA has included a

tonnage exemption that phases down over time and an exceedance

fee option, in part, to help provide the flexibility that the EPA

wanted to implement through the proposed variance procedure. The

EPA reasons that these provisions provide even greater

flexibility for regulated entities than the variance provision

but are less burdensome. Both of these compliance options are
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automatically available to all regulated entities, and do not

involve complex application and approval processes.

The tonnage exemption will allow each regulated entity to

exempt from the VOC content limit a certain amount of coatings

each year (the actual amount exempted depends on the VOC content

of the coating(s)). Therefore, the EPA believes that this

exemption is appropriate for low-volume coatings that would be

difficult or not cost-effective to reformulate in the near

future. The tonnage exemption will thus reduce the need for any

sort of variance procedure. 

 The exceedance fee option is designed, in part, to give

manufacturers and importers additional time to develop lower-VOC

technologies, while at the same time providing an economic

incentive to reduce the VOC content of coatings. This option

allows regulated entities to continue to sell coatings that

exceed the VOC content limits, provided that they pay an

exceedance fee. The amount of the fee is based on the volume of

the coating sold, the VOC content of the coating, the VOC content

limit applicable to the coating, and the fee rate. The

exceedance fee provision will reduce the need for any sort of

variance procedure.

In addition to these provisions, the compliance time, which

concerned some commenters, has been extended to 12 months and the

EPA added several new specialty coatings categories (zone

markings, concrete curing and sealing, conversion varnishes,

etc.) to the final rule. The EPA believes that the lengthening

of the compliance period will reduce the need for regulated

entities to have some sort of variance from the rule. Finally,

the EPA notes that the elimination of the variance procedure will

help to eliminate erosion of the air quality benefits of the rule

that might have occurred under the proposal. The tonnage

exemption and exceedance fee mechanism are more narrowly targeted

to provide flexibility where needed rather than the broader

exclusions that might have occurred under the variance process.

The purchase and use of emission reduction credits

recommended by one commenter as a compliance option is not
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allowed in the final rule. As stated in section 2.2.4.1 of this

document, several alternative market-based approaches were

considered and rejected as inappropriate for this industry. 

Need for Long-term, Universal Variance Procedure.

Comment: Seven commenters (IV-D-28, IV-D-122, IV-D-185,

IV-D-189, IV-F-1g, IV-F-1m, IV-Fo, IV-Fp.) suggested an amendment

to the variance provision that would provide a procedure for

addressing circumstances where new products that do not fit

within a specialized category are developed after publication of

the rule. According to one commenter (IV-D-28), the changing

nature of the industry (e.g., materials, new processing

structures) justifies the use of a more permanent modification

procedure, whereby a company could petition the EPA, which would,

based on the technical merit, provide a public hearing within 60

to 90 days and grant/reject a proposed modification to the rule. 

In some of these circumstances, according to another commenter

(IV-D-122), a compliance date and increments of progress cannot

be specified on the basis of legitimate unique technological and

economic feasibility considerations. The amendment proposed by

the commenter would establish a time not to exceed 5 years after

which the EPA would review the variance to ensure that

circumstances have not changed to allow for the specification of

a compliance date and increments of progress. According to the

commenter, this would allow manufacturers to develop and

commercialize innovative coating technologies without requiring a

complete rule amendment. The industry’s major trade association

(IV-D-189) also made the same suggestion, primarily to protect

manufacturers who operate mainly in unique or niche markets and

whose access to newer technology is limited. They suggested that

the variance procedure be easy to apply, balanced, and targeted. 

Another commenter (IV-F-1g) also maintained that there is a need

for a variance procedure so that companies can continue to

develop and market unique products.

Two commenters (IV-D-185, IV-Fo) stated that it would be

inappropriate to assign default VOC content limits to these

highly specialized coatings and innovative technologies and that
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the indiscriminate application of default limits could stifle

such innovation and leave future consumer needs unmet. The

commenters also requested that the EPA permit manufacturers of

new products to apply for a long-term variance that would allow

the new product to be marketed without specifying a compliance

date. The commenter suggested that the variance should be

available to any manufacturer, regardless of size, and it could

be reviewed by the EPA at specified intervals, not to exceed

5 years, in order to determine whether changes in circumstances

or technology permit application of a particular VOC content

limit and compliance date.

According to another commenter (IV-F-01p), a permanent

variance provision would provide the EPA with the flexibility to

decide on a case-by-case basis whether a product should be

allowed to stay on the market in its current formulation or be

brought to the market even if it does not meet the standard. 

Response: For the reasons described in the response above,

the EPA has determined that variance provisions are inappropriate

for the final rule. As discussed above, the EPA has included

alternative compliance mechanisms that it believes will better

target the necessary flexibility without providing potentially

unlimited exemptions from the VOC standards in the rule.

The EPA notes that if a regulated entity in fact develops a

truly new type of coating that does not fall within any of the

rule categories, the regulated entity may contact the EPA and

petition the EPA to revise the rule to include such new category.

Comment: One commenter (IV-D-22) was concerned that the

proposed rule included inappropriate loopholes in the form of

variances and possible exceedance fees.

Response: The EPA agrees that the variance procedure had

the potential to result in abuse and erosion of the VOC

reductions from the rule. For this and other reasons, the

variance provisions have not been included in the final rule. 

Contrary to the commenter's statement, the EPA does not consider

the exceedance fee to be a loophole, but a rather necessary

compliance alternative for some companies. The EPA's rationale
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for including these provisions is included in the section on

"Exceedance Fee," section 2.4 of this document.

2.2.9 Clarifications

Comment: One commenter (IV-D-162) noted inconsistencies

between the VOC content limits for coatings in the architectural

coating rule and VOC content limits for the marine coatings in

the NESHAP and CTG for shipbuilding and ship repair (surface

coating operations). The commenter suggested that the acceptance

of the shipbuilding VOC content limits suggests that lower VOC

technology to protect structures in severe service environments

is available for several categories of architectural coatings. 

The commenter compared the VOC content limits set out in both

proposed regulations for categories in the following table:

Coating category levels (g/l) levels (g/l)

Architectural

Coating Shipbuilding

General use/Industrial Maintenance 450 340

Antifoulant 400 400

High temperature 650 500

Inorganic/organic zinc 500 340/360

Nuclear 420 420

Pretreatment wash primer 780 780

Repair & maintenance thermoplastic 650 550

Weld-through preconstruction primer 500 650

The commenter concluded that other industry segments, such

as chemical processing, petroleum refining, bridges and highways,

etc., which use architectural and industrial maintenance coatings

should also be capable of eventually adopting similar, more

advanced materials such as those being utilized by the shipyards.

 Response: The VOC content limits established for

Shipbuilding and Ship Repair (Surface Coating) Operations were

based on the VOC content of coatings used in that industry and

achievable for that source category. Although lower VOC
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technology may be available for some shipbuilding coatings as the

limits in the above table seem to indicate, the architectural

coating rule is broader and covers many more manufacturers and

types of coatings. In addition, architectural coatings are

applied on-site in a field environment under varying conditions,

whereas shipbuilding coatings are applied at surface coating

operations at shipyards under more controlled conditions. For

example, industrial maintenance coatings are used in industrial,

commercial or institutional settings that include extreme

environmental conditions such as immersion in water, wastewater,

or chemical solutions, or chronic exposure of interior surfaces

to moisture condensation; acute or chronic exposure to corrosive,

caustic, or acidic agents, or to chemicals, chemical fumes, or

chemical mixtures or solutions; repeated heavy abrasion, etc. 

Considering the timing for implementing requirements (i.e.,

1 year), the number of manufacturers, and the variety of products

nationwide, the EPA set the VOC content limit for industrial

maintenance coatings at 450 g/l. Based on comments received, the

VOC content limit in the final rule for the antifouling and

nuclear categories was raised to 450 g/l, consistent with

industrial maintenance coatings. Also, the metallic pigmented

coating limit (500 g/l) in the architectural coating rule is not

limited to zinc as it is in the shipbuilding and repair rule

(under weld-through preconstruction primer). In comparing the

categories in the table above, the EPA agrees that lower VOC

technology may be available for some coatings under some

circumstances. However, the architectural coating VOC content

limits are based on VOC content levels designed to be achievable

nationwide under widely varying conditions and performance

requirements, whereas the shipbuilding coating requirements are

limited to a specific type of application and use and, therefore,

can be reflective of a more limited set of performance

requirements.

Comment: Several manufacturers (IV-F-2) asked about the

number of States getting State implementation plan "credit" for
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the rule and asked for clarification about the meaning of the

term "credit." This industry representative (IV-F-2) asked

whether States were getting State Implementation Plan credits for

the consumer products regulation and whether the States were

happy with the level of stringency of those standards. Another

industry representative (IV-F-2) asked if a CTG would provide the

same credit to the States as would a national rule.

Response: The term "credit" referred to by the commenters

is related to State implementation plans (SIPs) for reducing

ozone precursor emissions. States may take "credit" in their

SIPs for the VOC emission reduction estimated to result from the

architectural coating rule in the geographic area. Based upon

guidance provided by the EPA, as of July 1998, fourteen State and

local air pollution control agencies have taken credit in their

SIPs for a 20 percent reduction in VOC emissions from the

architectural coating rule. If the rule fails to result in a

20 percent reduction on a timely basis, State and local agencies

will need to make up the "shortfall" from other VOC source

categories. Therefore, some States have submitted comments

requesting that the EPA pursue the full extent of emission

reduction benefits achievable from the architectural coating

rule. Some States have complained that the VOC content limits in

the proposed rule are not as stringent as some State VOC content

limits.

The architectural coating rule is only one of several for

which States are able to claim emission reduction credits in

their SIPs. The consumer products rule is another national rule

being issued under section 183(e) of the Act, as is the

automobile refinish coating rule. States may claim credits

associated with those rules as well. To review comments from

States on the stringency of the consumer products rule and

documents supporting the final rule, please refer to the consumer

products rule docket (A-95-40). 

A CTG would also provide VOC emission reductions. However,

CTG limits could differ from those of a national rule and the

credits available to States would differ accordingly. The EPA
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notes that the determination whether to do a rule versus a CTG is

dependent, in part, upon which method will best obtain reductions

and that other factors are thus relevant.

2.3 IMPACTS

2.3.1 Environmental and Energy

2.3.1.1 HAP Implications

Comment: Three commenters (IV-D-02, IV-D-178, IV-F-1k)

stated that the EPA should consider the hazardous air pollutant

(HAP) implications of this rule. Two commenters (IV-D-178,

IV-F-1k) claimed that HAPs are often used when formulating lower

VOC coatings because they have greater solvency. One of these

commenters (IV-D-178) expressed concern that the increased use of

HAPs in coating formulations would result in increased HAP

emissions. Three commenters (IV-D-02, IV-F-1k, IV-F-1(l))

expressed concern if companies that reformulate using HAPs. The

commenters were concerned that alternative low-VOC formulations

encouraged by the EPA that contain HAPs could later become

regulated when the NESHAP standards are developed to control

HAPs. According to two of these commenters (IV-D-02, IV-F-1(l))

any such HAP regulations could then impose unrecovered

reformulation investments and lost sales on industry.

Response: The EPA disagrees with the commenter’s assertion

that to meet the proposed VOC content limits, manufacturers would

necessarily have to use more HAPs in their lower VOC

formulations. Data on speciated VOC content from the VOC

Emissions Inventory Survey show no pattern of higher HAP

concentrations in lower VOC formulations. Also, an article

entitled “Clean Air Act Amendments” which appeared in the

October 1995 edition of the Painting and Coatings Industry

Magazine, indicates that current HAP solvents such as ethylene

glycol ethers or ethylene glycol ether acetates will be replaced

with non-HAP solvents such as propylene glycol ethers or

propylene glycol ether acetates in response to Clean Air Act

requirements. In addition, information obtained from a

December 1995 report entitled “Improvement of Speciation Profiles

for Architectural and Industrial Coating Operations” prepared by
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Dr. Albert C. Censullo for the California Air Resources Board

(CARB) indicates that a majority of current water-based

formulations (flats and nonflats) contain non-HAP solvents. It

appears from this information that the use of non-HAP solvents,

such as Texanol and propylene glycol in water-based formulations

is prevalent today and should continue in the future. The only

NESHAP that might impact architectural coatings is the

Miscellaneous Organic NESHAP, commonly referred to as the MON. 

The MON is currently under development and will limit HAP

emissions from the paint and coating manufacturing processes. 

Naturally, the EPA does not condone the expanded use of HAPs in

architectural coatings and does not believe that companies would

choose to expose the public to additional HAP emissions when

there are other available and reasonable reformulation options.

2.3.1.2 Emission Reduction Estimate

Comment: Four commenters (IV-D-118, IV-D-126, IV-D-191,

IV-D-22/IV-F-1a) stated that the EPA's emission reduction

calculation on a solids basis overestimates the emission

reduction actually achieved. One commenter (IV-D-118) stated

that the solids approach is inconsistent with calculation methods

commonly used by States with similar rules. Another commenter

(IV-D-126) complained that the solids approach is inconsistent

with the volume approach agreed upon by the regulatory

negotiation participants. A third commenter (IV-D-22/IV-F-1a)

explained that calculating emission reductions on a solids basis

assumes coatings are reformulated by replacing photochemically

reactive solvent with coating solids, resulting in a greater

coverage per can of coating. According to the commenter,

participants in the regulatory negotiations agreed that the

calculation of emission reductions should be on a volume basis,

which is a more conservative estimate. This commenter also

disagreed with the EPA's assumption that traffic coatings

manufactured by State and local governments increase by threefold the total volume of such coatings to be figured into an

emission reduction calculation. For these two reasons, the

commenter contended that the EPA's 20 percent emission reduction
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claim is an inflated estimate of the proposal's effectiveness and

calculated the emission reductions attributable to the proposed

architectural coating rule to be no more than 12 percent.

Response: The EPA disagrees that its method of calculating

the emissions reductions is inaccurate. The amount of coating

required for a specific architectural coating job ultimately

depends on the solids content of the coating. The constant

solids approach for determining VOC emissions is based on

accepted methods of calculation and is consistent with past

practice and methods used by industry, the California Air

Resources Board (CARB), and the South Coast Air Quality

Management District (SCAQMD). Thus, the EPA contends that this

approach makes the most sense for determining emissions

reductions and is the approach used by the EPA for all of its

coating rules. 

In calculating the emission reductions for traffic coatings,

the EPA used a factor of 2.6 at the time of proposal to account

for the traffic coatings not included in the industry survey. 

The non-reported volume included both coatings manufactured by

State and local governments and those manufactured by

manufacturers that did not respond to the survey. In the EPA’s

final emission reduction analysis, a factor of 2.5 was used based

on information provided by NPCA in June 1997 that indicated that

the market for traffic markings has been fairly constant from

1990 to 1995 and that the 1995 sales volume reported for traffic

markings in the Bureau of Census report is close to the actual

sales (IV-E-11). 

Comment: Five commenters on seven occasions (IV-D-177,

IV-D-184, IV-D-212/IV-F-1c, IV-D-214b, IV-D-214c, IV-F-1j)

asserted that regulating the VOC content of architectural

coatings would result in increased VOC emissions rather than the

emission reductions claimed by the EPA. Three commenters

(IV-D-177, IV-D-189, IV-D-212) expressed concern that coating

reformulation could result in the manufacture of inferior

performing products. Another commenter (IV-F-1j) contended that

reformulation would cause unspecified problems with the coatings. 
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These commenters contended that with low-VOC coatings consumers

would use more undercoats and apply more topcoats (IV-D-214c);

repaint more frequently (IV-D-177, IV-D-189, IV-D-212,

IV-D-214c); thin illegally (IV-D-189, IV-D-214c, IV-F-1j); be

forced to use a stripper and re-do the coating (IV-F-1j); and do

more touch-up painting (IV-D-212). The commenters asserted that

these activities will result in increased aggregate emissions. 

One commenter (IV-D-214c) claimed that 19 years of regulating the

VOC content of architectural coatings in California has suggested

that these counterproductive effects occur. One commenter

(IV-D-177)claimed that although the VOC content of paint in

California was reduced in the 1980s, costs escalated, VOC output

remained nearly constant on a per population basis, raw material

consumption increased, and the population dramatically increased

causing much more use and more need for VOC reduction. 

One commenter on two occasions (IV-D-214b, IV-D-214c) stated

that the proposal preamble purported to address the environmental

question of the “increase or decrease in air pollution ... that

would result from implementing the proposed standards.” 

According to the commenter, small and regional manufacturers have

submitted substantial evidence of activities that would increase

air pollution. The commenter claimed that possible increases in

VOC emissions or the reactivity of emission due to reformulation

required by stringent emissions standards were recognized and

delineated in Dunn-Edwards Corp. v. Bay Area AQMD, 9 Cal.App.4th

644, 657-058 (1992). The commenter (IV-D-214b, IV-D-214c)

referred to the court decision in Portland Cement Assn. v.

Ruckelshaus, 486 F.2d at 385, for the proposition that the EPA is

required to take into account “counter-productive environmental

effects” of the proposed standard. Also, in Corrosion Proof

Fittings v. EPA, 947 F.2d 1201, 1221 (5th Cir. 1991), the

commenter claimed that the court held that the EPA could not

validly ban certain products “when it refuses to evaluate the

harm that will result from the increased use of substitute

products.” 
2-293

The commenter (IV-D-214c, IV-D-214b) claimed that the EPA

has ignored the fact that the architectural coatings rule might

actually increase air pollution by concluding simply that the

rule would reduce VOC emissions and assuming that no counterproductive effects would occur. 

Response: The EPA disagrees with the conclusions of the

commenters on this issue. The commenters are implying that the

proposed architectural coating VOC rule will result in higher,

not lower, ozone concentrations because more people will use more

coating to coat the same amount of surface and more reactive

solvents will be used in the compliant products. The commenters

evidently believe that no controls on VOC emissions from coatings

are a more effective means to reduce VOC emissions.

First, the commenters provided no evidence or documentation

to support their claims of increased thinning, more priming, more

topcoating, and more frequent painting. The evidence available

to the EPA indicates that the commenters’ assertions are

incorrect. Specifically, the SCAQMD conducted and reported on

studies that addressed the issue of thinning paints in the field. 

Field investigations of actual painting sites in the South Coast

District and other areas of California with rules that limit the

VOC content of coatings indicate that thinning of specialty

coatings exists but rarely beyond the manufacturer's recommended

levels (IV-J-18). Where thinning occurred, therefore, paints

were rarely thinned to levels exceeding applicable VOC content

limits. Thus, widespread thinning does not occur often; when it

does occur, it is unlikely to occur at a level that would lead to

a substantial emissions increase when compared with emissions

from higher VOC content coatings.

The EPA also has no reason to concur with the commenter's

contention that lower VOC content coatings will result in the use

of more undercoats. The SCAQMD evaluated the assertion that the

use of substitutes or water-based topcoats would result in

increased VOC emissions by comparing the VOC content of

substitute coating systems to traditional coating systems and

determined that the use of substitute coatings will actually
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result in significantly lower emissions than using traditional

coating systems (IV-J-18). Their study concluded that the low

VOC substitutes did not require additional undercoats and that

the lower VOC contents of substitute coatings result in lower

emissions.

The commenter's claim that users would apply more topcoats

is based on their assumption that compliant coatings have a

higher solids content that is applied in a thicker coat. The

commenter thus asserts that compliant coatings cover less area

compared to a high VOC content coating. As a result, the

commenter believes a higher volume of compliant coating is needed

to get the same coverage, negating any VOC emissions reductions. 

The EPA expects that low VOC content coatings will have the same

or better coverage area as high VOC coatings so it is not

expected that a larger quantity of coating will be necessary to

cover the same area.

In addition, contrary to the commenters’ claim, the EPA did

assess available information about the possibility that a low-VOC

coating system might paradoxically result in greater VOC

emissions because the system might require additional coatings. 

The EPA has evaluated the VOC emissions from four low-VOC

industrial maintenance coating systems suitable for coating steel

substrates compared to the VOC emissions from a conventional

coating system (IV-B-4). All five coating systems were

formulated to be used for the same purposes and all of the

coating systems meet the VOC content limit for industrial

maintenance coatings in the final rule (i.e. 450 g/l). The

conventional coating system consisted of a solventborne alkyd

primer containing 394 grams per liter VOC and a solventborne

alkyd enamel topcoat containing 424 grams per liter VOC. The

low-VOC alternate systems were:

& A three-coat system consisting of a solventborne,

moisture-cured polyurethane primer (VOC content of

360 grams per liter), a solventborne, zinc-rich,

moisture-cured polyurethane middle coat (VOC content of

360 grams per liter), and a solventborne polyurethane

topcoat (VOC content of 372 grams per liter);
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& A two-coat system consisting of a solventborne alkyd

primer (VOC content of 394 grams per liter) and a

waterborne acrylic topcoat (VOC content of 190 grams

per liter);

& A single coat system consisting of a two-component

polysiloxane epoxy topcoat (VOC content of 84 grams per

liter); and

& A two-coat system consisting of a water-reducible alkyd

primer (VOC content of 237 grams per liter) and a

waterborne acrylic topcoat (VOC content of 284 grams

per liter).

The comparison of these coatings with varying VOC content

indicates that lower VOC content typically results in lower

overall VOC emissions. The average VOC emissions of the two-coat

and single-coat alternate systems were lower than those of the

conventional coating system. In fact, the VOC emissions from the

two-component polysiloxane epoxy topcoat system were

approximately 25 percent of the emissions from the conventional

coating system. However, the three-component, solventborne

polyurethane coating system had higher VOC emissions than the

conventional coating system. In this case, the information in

the study indicates that the number of coatings required and the

additional film thickness played a major role in producing such

high emissions. Thus, a low VOC content for a coating does not

necessarily mean lower emissions for the system as applied if the

system requires additional layers. As a result, the study

indicates that users would not need to apply more low-VOC

topcoats to achieve the same results.

This study also calculated the transfer efficiency for each

of the coating systems using the amount of coating used and the

total amount of solids deposited on the test surface. The

reported transfer efficiency for the conventional coatings was

between 30 and 35 percent. The study reported that the transfer

efficiency was best for the three-coat system (greater than

35 percent), comparable for the two-coat solvent borne alkyd

primer/waterborne acrylic topcoat system and the conventional
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system (30 to 35 percent), and poorest for the single coat system

(less than 15 percent). Thus, there are low-VOC and higher

solids coatings available that are able to be applied with

relatively good transfer efficiency.

The commenter also contended that using compliant coatings

will require more topcoats because of the purportedly poorer

performance of lower VOC coatings. The Ventura County Air

Pollution Control District (VCAPCD) conducted performance tests

on a range of low-VOC content coatings from 1991 to 1992 (Cowan,

1992, IV-J-4). The VCAPCD tested 49 different coatings

representing compliant clear wood finishes, quick-dry enamels,

quick-dry primers, and industrial maintenance coatings using both

brush and spray applications. The performance test evaluated

ease of application, appearance, adhesion, hardness of topcoat,

ability to cover extreme surface conditions (rusty metal, charred

wood), and appearance after six months. The VCAPCD found that

these coatings performed well and that additional topcoats were

not required. The EPA notes that the commenter itself produces a

full line of products that meet more stringent VOC content limits

in California, that the commenter’s products were among those

tested in the VCAPCD study, and that the commenters’ products are

reputed to be of high quality and performance.

With regard to more touch-up and repair work, the EPA

expects that low VOC coatings will reduce, not increase the

amount of touch-up and repair work resulting from surface

contamination. By the commenter's own admission (IV-D-212),

these coatings dry more rapidly than high VOC content coatings. 

As a result of their more rapid drying, the opportunity for

surface contamination will be decreased.

Although the commenter asserted that lower VOC content

coatings are less durable than higher VOC coatings, information

available to the EPA indicates that when applied correctly,

compliant coatings are as durable, or in some cases, more durable

than traditional coatings. The durability of a coating is

dependent on many factors, including: surface preparation,

application technique, substrate coated, and exposure conditions. 
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The EPA has reviewed numerous performance studies comparing lowVOC content coatings with conventional coatings (IV-B-4). The

results of these studies indicate that although no one low-VOC

content coating may outperform or perform equivalently to the

conventional coatings on all substrates under all circumstances,

at least one or more low-VOC content coatings do outperform or

perform equivalently to the conventional coatings on any given

substrate under any given circumstance. Thus, for optimum

performance when using low-VOC content coatings, the user must

properly select the low-VOC content coating based on the

substrate, the desired performance requirements, and the expected

environmental conditions to which the coating will be exposed. 

Second, the commenter's contention that more reactive

solvents will be used instead of traditional less reactive

solvents in the compliant products is misleading. This is

because (1) the rule does not require such major shifts in

existing resin and solvent technology and (2) the benefit from

the total mass of VOC emissions reduced is expected to outweigh

any differences in relative reactivities of different chemicals. 

While different chemical species may have different relative

reactivities, both the amount of VOC emitted and the reactivity

of the VOC (which is dependent on ambient conditions that vary at

different times and places), affect the amount of ozone formed.

Chemical species with lower reactivities than other chemicals can

still be significant ozone producers if they occur at high

concentrations and under favorable conditions (Docket A-94-65,

Item IV-J-11). 

Chemicals in solventborne coatings contain VOC which are

reactive (i.e., under most conditions, they have higher

reactivity than ethane, which is the EPA’s yardstick for

determining whether a compound should be declared “negligibly

reactive” and, thus, not considered a VOC for regulatory

purposes). The most common solvents used in house paints and

other “do-it-yourself” paints are petroleum hydrocarbon solvents,

such as “mineral spirits” and VM&P naphtha (which contain large

amounts of alkanes), hexane, etc. The most common solvents used
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in coatings typically applied by professional contractors, such

as industrial maintenance and traffic marking coatings, are

toluene and xylene. Toluene and xylene rank relatively high on a

reactivity scale that measures the potential to form ozone during

the first solar day after emission under certain conditions (see

Carter, 1994; Docket A-94-65 Item IV-J-5)). Thus, it is

misleading to represent traditional solventborne coatings as

being of low reactivity or as something that can be ignored when

considering the need to control VOC to reduce ozone levels.

Furthermore, the EPA believes that the commenter is not

considering the uncertainties associated with relative reactivity

scales and the ability to use these scales at this time to make

or the current state of knowledge about atmospheric chemistry of

organic compounds. Dr. William Carter, University of Riverside,

Center for Environmental Research and Technology, College of

Engineering, who has established several different reactivity

scales, cautions the use of these scales due to the uncertainties

involved. For example, Dr. Carter stated that:

Deriving such numbers is not a straightforward matter and

there are a number of uncertainties involved. One source of

uncertainty in ozone reactivity scales comes from the fact

that the ozone impacts of VOC depend on the environment

where the VOC is emitted. A second source of uncertainty is

variability in the chemical composition of the VOC source

being considered. Complex mixtures such as ‘mineral

spirits’ may be more difficult to characterize and may vary

from manufacturer to manufacturer though in principal the

composition of a given lot can be determined and reasonably

assumed to be constant regardless of how the product is

used. A third source of uncertainty comes from the

complexity and uncertainties in the atmospheric processes by

which emitted VOC react to form ozone (Carter, 1995)

(IV-J-18).

According to Dr. Carter, reliable reactivity numbers do not

currently exist from which accurate air quality policy can be

derived based on reactivity and not total VOC emissions. Ketones

are the most important class of consumer emissions for which

there are no environmental chamber reactivity data suitable for

evaluating reactivity predictions. Also, he finds no
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experimental reactivity data for glycols or alcohols suitable for

mechanism evaluation (Carter, 1995) (IV-J-18).

Another factor to be considered is an accurate speciation

profile of water-based and solvent-based coatings. Dr. Albert C.

Censullo, Professor of Chemistry, California Polytechnic State

University, San Luis Obispo, conducted a comprehensive assessment

of species profiles for a number of sources within the general

categories of industrial and architectural coatings operations

(Censullo, 1995) (IV-J-7). As part of the Censullo study, 52

water-based coating samples were analyzed and species profiles

were determined by using an average of at least two analyses. 

The four most common solvents identified in water-based coatings

were Texanol (found in 37 out of 52), propylene glycol (found in

31 out of 52), diethylene glycol butyl ether (found in 23 out of

52), and ethylene glycol (found in 14 out of 52), all of which

were identified by Dr. Carter as needing further reactivity

assessment.

Additionally, from the Censullo study, emission profiles

were obtained for 54 solvent-based coating samples. The results

were significantly more complex as compared to the species

profiles for the water-based samples, primarily due to the

various petroleum fractions used in solvent-based coatings. Some

of the species profiles resulted in several hundred components

from one sample. Dr. Carter has compiled reactivity data on

several of the species identified, but has also indicated the

need to further assess the reactivity of MEK, isopropyl alcohol,

other alcohols, and esters found in solvent-based coatings. 

In the absence of actual reactivity numbers for the

compounds in "traditional" formulations and compliant, low-VOC

content coatings, emissions must be calculated in the standard

manner of total VOC per unit of coating applied. Based on the

current state of knowledge regarding VOC reactivity, there is

nothing to suggest that the architectural coating VOC rule will

result in adverse air quality impacts due to increased reactivity

of solvents used to comply with the rule.
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Finally, because of the flexibility of tonnage exemptions

and exceedance fees, the EPA does not expect the architectural

coating rule to result in the substantial banning of any

products. The maximum amount of coating estimated to be

withdrawn from the market due to the rule is approximately

700,000 liters of architectural coating products, accounting for

less than 0.03 percent of industry product volume. 

Comment: One commenter (IV-D-214c) claimed that the EPA had

not demonstrated that the mineral spirits in solvent-based

coatings were sufficiently reactive to contribute to ozone

nonattainment or that the glycol compounds in waterborne coatings

were sufficiently volatile to contribute to ozone nonattainment. 

Response: In the 1977 policy statement "Recommended Policy

on Control of Volatile Organic Compounds" (42 FR 35314,

July 8, 1977), the EPA recognized a class of organic compounds

that has been determined to have negligible photochemical

reactivity and is not required to be controlled under SIPs. 

Ethane was one of the four compounds on the negligibly reactive

list in the 1977 policy statement. Over the years, several other

compounds have been recognized as being negligibly reactive and

have been added to the list. This list of negligibly reactive

compounds was incorporated into the EPA's definition of volatile

organic compounds that appears in 40 CFR 51.100(s). This VOC

definition in part 51 of chapter I of title 40 of the Code of

Federal Regulations does not include mineral spirits on the list

of compounds considered to be exempt. Therefore, by definition,

mineral spirits are considered to be VOCs and to contribute to

ozone formation. Periodically, compounds are excluded from the

VOC definition after petitioners satisfactorily demonstrate that

the compound has less propensity to contribute to ozone formation

than ethane. For example, acetone was excluded from the list on

June 15, 1995.

Although glycol compounds are relatively nonvolatile and may

not be immediately emitted into the air, the EPA has conducted

studies that indicate that glycol will be emitted gradually over

time (see Docket A-94-65, Items IV-J-12 and I-J-13).
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Finally, because of the flexibility of the tonnage exemption

and exceedance fee, the EPA does not expect the architectural

coating rule to result in the substantial banning of any

products. The maximum amount of coating estimated to be

withdrawn from the market due to the rule is approximately

700,000 liters of architectural coating products, accounting for

less than 0.03 percent of industry product volume. 

Comment: One commenter (IV-D-128) provided a rough-cut

analysis of the impact of the rule on his company. The current

weighted average (first eight months of 1996) VOC content for

products manufactured by the company with a proposed VOC content

limit of 3.75 pounds per gallon is 2.118 pounds per gallon. 

Ignoring the question of product quality and practicality, full

compliance with the proposed rule would reduce the average VOC

content of the company’s products to 2.091 pounds per gallon, a

reduction of 1 percent or approximately 3 tons per year. 

Therefore, the commenter contended that any increase in painting

frequency or required film thickness resulting from using the

compliant coatings would more than offset the VOC emission

reductions from reformulating the non-compliant coatings.

Response: The amount of VOC reduced from any given

manufacturer’s product line depends on the sales volume and the

difference between the VOC content of the products and the VOC

content limit applicable to the product. Naturally, 1 gallon of

a product that is very close to the VOC content limit will

contribute less to overall VOC reduction than one gallon of paint

that is far from the VOC content limit. However, even products

that are close to the VOC content limit can contribute

significantly to the overall emission reduction if they are sold

in large quantities.

As stated in a previous response, the EPA contends that

compliant coatings will not result in more frequent painting or

reduced coverage because of thicker films. The EPA believes that

the available evidence suggests that lower VOC products have

acceptable durability and performance characteristics. The EPA

believes that VOC content reductions will not cause the alleged
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need for more frequent repainting, and that to the extent such an

effect were to occur it is still preferable to obtain the large

amounts of VOC reduction that will result from the rule

notwithstanding such effect. The EPA expects that after the rule

is promulgated the same amount or less of compliant coating will

be used compared to non-compliant coating use before the rule was

promulgated. With respect to the commenters statement that it

would be unwilling to do the minor reformulation necessary to

achieve the modest VOC reductions necessary in its products, the

EPA notes that the flexibility of the tonnage exemption and

exceedance fee provides manufacturers with alternatives to

reformulating essential coatings that are manufactured in low

volumes or that are impractical to reformulate by the compliance

date. 

2.3.1.3 Wastewater/Solid Waste Impacts

Comment: Three commenters (IV-D-189, IV-F-1e, IV-F-1s)

questioned the EPA's conclusion that no significant adverse water

impacts would result from the rule. For example, the commenters

noted that hazardous waste production which is associated with

the manufacture of waterborne coatings could increase. One

commenter (IV-F-1s) explained that high-performance resin systems

used at their plants have been very difficult to remove from

clean-up water using what they know about wastewater treatment

technology. The commenter estimated that the current cost to

treat this water may be two to three times higher than the costs

for solvent system cleanups. The commenter's plants use in-plant

solvent distillation systems where the solvent is continually

recycled with a small amount of sludge going off site for

disposal. The commenter reportedly has a plant that has gone

4 years without making any solvent waste because they

sequentially batched materials and recycled the solvent. The

commenter claimed that internal recycling of water is more

difficult because of bacterial contamination and surfactant

addition. The commenter explained that the moment air hits the

resin, the resin is on the tub used to mix the product because

the resin forms a tough film very quickly. This can result in
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manufacturers inappropriately trying to use solvents to wash the

resin off and creating a solvent and water mixture. The

commenter uses surfactants to clean the resin off of the

equipment, which prevents them from recycling the water. A

second commenter (IV-F-1e) concurred that the amount of waste

generated is more difficult to remove from the mixers unless

solvents are used. The commenter asserted that this waste is

more difficult to treat. The treatment systems are reportedly

expensive to purchase. The chemicals used to treat or flocculate

the drills are likewise reportedly expensive. Compared to

solvent systems that are easy to use, the commenter claimed that

waterborne systems can result in a very tedious process. One

commenter (IV-F-1s) also pointed out that obtaining a permit to

connect an industrial discharge of wastewater to a publicly owned

treatment works (POTW) may cost several hundred thousand dollars

in some metropolitan areas. Their facilities sealed their floor

drains to prevent solvent from going to the POTW and never had an

industrial permit to connect to the POTW.

Response: The EPA acknowledges that in cases where

manufacturers achieve compliance by converting from solventborne

to waterborne coatings, an increase in wastewater discharge may

occur if waste from the manufacture of waterborne coatings is

discharged by manufacturers to publicly owned treatment works. 

Discharges from these facilities or from POTWs would be subject

to applicable effluent guideline standards. These discharges

would receive appropriate treatment before the water is released

into the environment. Thus, these discharges would have small

environmental impacts. However, the EPA expects that the

majority of the VOC content limits in the rule will not force

manufacturers to convert to waterborne coatings. For the vast

majority of categories, the VOC content limits are high enough to

allow manufacturers to continue to offer solventborne coatings. 

Therefore, the EPA has concluded that the adverse water impacts

would not be significant in comparison to the air emission

benefits resulting from the rule. 
2-304

2.3.1.4 Energy Impacts

Comment: One commenter (IV-F-1j) believes that for

production lines, the slower dry times resulting from higher

solid formulations or substitution of waterborne products is

going to slow the production schedules, which can increase energy

costs associated for forced curing, resulting in higher energy

usage.

Response: The architectural coatings VOC rule applies only

to coatings applied to architectural structures and does not

apply to shop-applied coatings or coatings used for original

equipment manufacturing. Thus, the commenter’s concern regarding

production schedules, forced curing, and higher energy use are

not applicable to this rulemaking. 

2.3.2 Cost/Economic

2.3.2.1 Reformulation Cost Estimate

Comment: Twenty-seven commenters submitted information in

response to the EPA’s request for information on the cost to

reformulate a product to comply with the regulation. Comment

letters received and reviewed for this purpose include:

IV-D-02 IV-D-93 IV-D-152 IV-D-192

IV-D-08 IV-D-108 IV-D-157 IV-D-212aa

IV-D-27 IV-D-110 IV-D-159 IV-D-212cc

IV-D-36 IV-D-115 IV-D-167 IV-D-217

IV-D-38 IV-D-128 IV-D-170 IV-D-222

IV-D-39 IV-D-130 IV-D-173 IV-F-1e

IV-D-44 IV-D-146 IV-D-182

Response: The EPA appreciates the input from the above

commenters. Upon review of these comments, 11 of the responses

(IV-D-36, 38, 93, 108, 110, 128, 130, 152, 182, 217 [two

estimates], and IV-F-1e) appeared to provide comparable

information for gauging lump-sum reformulation costs per product. 

These estimates are summarized in Appendix A of this BID and in

Appendix B of the EIA. Other comments presented costs for all of

the company’s products, but did not provide information on the

number of products to enable computation of the cost per product. 

Other comments could not be used either because of incompleteness
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or lack of clarity about the information provided. The EPA

combined these estimates with the original estimate used at

proposal to derive a revised average cost to reformulate a

product. Cost per product estimates from these comments ranged

in value from $576 to $272,000, with a mean value of $86,326. 

This mean value was rounded to $87,000 to provide a

“representative product” cost estimate used throughout the cost

and economic analysis for the final rule. 

Comment: One commenter (IV-D-08) stated that the EPA's

annualized reformulation cost estimate of $17,770 per formula is

extremely low and unrealistic for two reasons. First, the

commenter argued that it is based on averaging only the costs of

laboratory personnel. Second, the commenter stated that it is

based on an industry survey which excluded over 400 small paint

manufacturing companies. Another commenter (IV-F-1m) stated that

the true cost of reformulation should include the costs actually

expended by small businesses both to reformulate and to make all

of the other changes necessary in their products and marketing

tools in order to bring a new product to market. One commenter

(IV-D-27) estimated a total cost of $400,000 for each product

that could not meet the proposed VOC content limit and could be

reformulated. The total cost includes estimated expenses for

technical training for chemists; one-time expense for

prioritizing products for reformulation; examination, selection,

and testing of surveyed raw materials; suitable performance

packaging (which is required by another Federal regulation);

performance tests for each product; and field/market testing of

products. Another commenter (IV-D-93) estimated that 91 of their

products will have to be reformulated at an estimated cost of

$30,000, which includes a part-time formulator for 6 months and

the cost of producing one 50-gallon test batch for each of these

91 products. Another commenter (IV-D-108) estimated the cost to

reformulate two products would be $50,000. This estimate did not

include other related costs such as the cost of revised and

redistributed Material Safety Data Sheets (MSDS) (required by
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Federal law) at $35,000; cost of replacement product literature

at $30,000; and loss on label conversion at $12,000.

Response: The EPA’s annualized “reformulation” cost estimate

includes not only the costs of laboratory personnel, but also

includes costs for technical and market testing. The EPA thus

included those costs that the EPA believes accurately reflect the

impacts of reformulation. Table 2-1 in the EIA (Docket

Item IV-A-1) lists the various uncertainties and potential biases

surrounding the reformulation estimate which generally could not

be quantified. 

The EPA acknowledges that the industry survey on which the

reformulation estimates were based did not include a large number

(i.e., close to 400) of small paint manufacturing companies. 

The survey was designed to obtain input from as many

manufacturers of architectural coatings as possible. Over 950

survey forms were mailed by industry representatives to companies

that were identified as possible manufacturers of architectural

coating products. Of the 173 companies that responded to the

survey, 114 manufactured architectural coatings which were

estimated to represent 76.6 percent of the total gallons of

architectural coating products produced in 1990. The EPA

extrapolated the survey population of coating products to account

for the volume of products not reported by manufacturers. This

approach assumes that the feasibility issues facing the small

manufacturers that responded to the survey would be similar to

those facing the nonrespondents (i.e., if a portion of surveyed

small manufacturers are able to formulate a coating at a given

VOC content level, a similar portion of small manufacturers who

did not respond to the survey would be able to achieve this VOC

content level as well). 

To supplement the assumptions made about the feasibility of

reformulation, the EPA requested detailed information in the

preamble to the proposed rule on the following: (1) any specialty

niche products which do not comply with Table 1 and that cannot

be cost-effectively reformulated; (2) the sales volume and VOC

content of these products; (3) detailed cost estimate for
2-307

reformulation; and (4) whether a lower VOC coating exists in the

market which can adequately substitute for the identified

product. 

EPA received some additional reformulation cost estimates

during the public comment period (these estimates included costs

beyond laboratory personnel). As Appendix A of this document

indicates, the EPA’s cost estimate used at proposal was 3 to

5 times greater than the average given in the public comments. 

The EPA adjusted the reformulation estimate to reflect these

comments and believes $14,573 represents a realistic value.

Comment: One commenter (IV-D-08) emphasized that the rule

would not eliminate the problems and costs of multiple product

formulation in different states, as many States with more

stringent rules would maintain their programs. As such, the

commenter expressed concern that manufacturers will experience

increased product formulation and maintenance costs.

Response: The EPA believes the national regulation will

minimize the problems associated with compliance and multiple

regulations at the State level. This is because some States are

relying on the EPA’s regulation rather than developing their own

rules, some States have included “sunset” provisions in their

regulations so that once the national rule takes effect their

rule will no longer be effective, and other States have statutes

that prohibit their own State regulation from being more

stringent than Federal standards. However, as the commenter

suggests, the national rule will not entirely eliminate the

problems and costs associated with multiple State regulations

since some States may choose to impose or continue to impose

different and more stringent requirements. The EPA notes that

section 183(e) of the Act expressly allows for States and

localities to have more stringent rules if they so desire. 

Nevertheless, the EPA has attempted to issue a final rule that

will minimize the need for additional State rules by achieving

appropriate reductions nationwide.

Comment: One commenter (IV-D-212p6o) stated that the

economic impact on the architectural coatings industry of the
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proposed rule would be substantially in excess of $40 million

estimated by the EPA at proposal. The commenter estimated the

minimum economic impact of the proposed controls to be

$104 million. The commenter assumed an 18 percent reduction

(i.e., 94,500 tons) from a baseline of 525,000 tons of VOC per

year nationwide at a cost of $1,100 per ton (as estimated by the

Office of Technology Assessment (OTA)). The commenter argued

that the South Coast Air Quality Management District's (SCAQMD)

estimate of $16,400 per ton of VOC reduced is more accurate. 

Based on the SCAQMD’s cost-effectiveness estimate, the commenter

stated that an 18 percent reduction would cost the industry

$1.6 billion. Another commenter (IV-F-2) also pointed out that

the SCAQMD used a value of $16,400 per ton of VOC reduction for

their architectural coatings rule.

Response: The EPA disagrees with the conclusions of the

commenters, but understands the source of their misunderstanding. 

Upon re-examination of the cost impacts of the rule, the EPA has

determined that the projected costs were estimated correctly. 

The detailed approach taken at proposal by the EPA to estimate

cost-effectiveness was based on VOC content data from the 1990

VOC Inventory Survey conducted by the National Paint and Coatings

Association, which represents the most comprehensive VOC content

inventory of the industry’s products conducted to date. Based on

the sales and VOC content data from the survey, the costs were

extrapolated to the nation using conservative (upper bound)

assumptions of the total number of products requiring

reformulation nationally. The EPA’s reformulation cost estimates

are based on industry input prior to proposal (adjustments to

this estimate have been made based on comments received after

proposal). The analysis then considered influences in a

competitive market on product price and output, along with the

consideration of lower-cost compliance options such as the

tonnage exemption, exceedance fee provision or product

withdrawal. The analysis not only measures the cost to producers

that must comply with the regulation, but also to all consumers
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impacted by the changes in the market resulting from the

regulation. 

The commenter cited an OTA estimate of cost-effectiveness of

$1,100 per ton and SCAQMD’s estimate of cost-effectiveness of

$16,400 per ton. These cost-effective estimates are not

meaningful for evaluating the accuracy of the EPA’s costeffectiveness estimate since the cost-effectiveness depends on

the specific requirements in the regulation. The OTA estimate

was not based upon the national rule as promulgated, and hence

does not reflect its costs. All else equal, controlling each

incremental unit of VOC emissions will be progressively more

costly as the stringency of controls increases and the

availability of control technology decreases. For example, the

SCAQMD is in need of extensive controls for an extreme ozone

problem, which results in a relatively high cost-effectiveness

measure. The SCAQMD’s estimate of $16,400 per ton of VOC

reduction represents a 75 percent reduction from 1990 levels

which must be achieved by the year 2010. This is not comparable

to the national regulation which is expected to achieve a

20 percent VOC reduction from 1990 levels. The EPA believes the

detailed approach taken in the Economic Impact Analysis, which

for the final rule resulted in a cost-effectiveness calculation

of $250 per ton (1991 dollars), is appropriate and more

accurately estimates the costs to the nation than either the OTA

or the SCAQMD estimate.

Comment: One commenter (IV-D-120) suggested that the EPA’s

estimate of the costs to manufacturers to reformulate might not

be accurate for every coating category, the commenter claims that

their company spent between $250,000 to $500,000 trying to

reformulate concrete surface retarders. The commenter recounted

its 5-year reformulation effort that resulted in a non-userfriendly VOC compliant product. The commenter claims that it

lost 85 percent of its previous business in California as a

result of not being able to reformulate to meet VOC compliant

levels.
2-310

Response: The EPA acknowledges that the costs to reformulate

particular products may vary from the average projected, i.e.,

some will be higher and some will be lower. The EPA cannot

assess whether the costs cited by the commenter are correct, but

believes that they are not typical. As noted above, the

information available to the EPA suggests that the costs of

reformulation, on average, will be far lower. The EPA has

recognized the special issues associated with reformulating

concrete surface retarders and has created a category for these

products with a VOC limit of 780 g/l. The addition of this

category is described in detail in section 2.2.4.2 of this

document.

Comment: One commenter (IV-D-214c) contended there will not

be enough time or money for most manufacturers to reformulate to

meet the proposed limits. Another commenter (IV-F-1[l]) quoted a

representative of a major manufacturer who estimated that

reformulating approximately one-fourth of the company's product

lines would require 100 to 150 man-years and cost from $10 to

15 million, only including the cost of the labor required to

reformulate. Another commenter (IV-F-1m) provided a similar

example of a company that has 44 products to reformulate. This

will cost the company $11 million at a cost of $250,000 per

reformulation. In addition, the commenter claimed that it will

take 110 scientist years to do the reformulation. The commenter

also pointed out that there are not enough formulation chemists

available and there is not enough time to hire them and

accomplish the reformulations in time to comply with the rule.

Response: Based on these general comments and several other

public comments on the time needed to comply, costs of

reformulating individual products, and statements of the burdens

on small entities, the EPA revised the rule to include a 1-year

compliance period combined with a phased tonnage exemption

provision and an exceedance fee provision. All of these

provisions will provide manufacturers additional time and

flexibility to comply with the standard so that it is

economically feasible for a predominant number of products
2-311

(excluding the less than 1 percent of products that are projected

to withdraw from the market).

This can be exemplified by the information provided by

commenter IV-F-1m. The estimate of $11 million in regulatory

costs represents the worst case of potential costs in that it

assumes that every reformulation will cost the full $250,000, and

that none of the noncompliant products are similar enough in

characteristics to not incur reformulation costs (i.e., the EIA

assumes 1/3 of products requiring reformulation are similar

enough in characteristics to not incur a cost). This estimate

will be reduced substantially if all options of the final rule

are considered by the company along with the revised estimate of

product reformulation cost ($87,000 per product). For each of

the 44 products, the company should consider the least cost

strategy to comply with the regulation from a combination of the

tonnage exemption, reformulation, the exceedance fee, and product

withdrawal. For example, if the annual fee payments on a product

would be less than the annualized reformulation cost estimate,

the least cost strategy for this product would be the fee

provision. The resulting cost across all 44 products must also

be annualized over the appropriate period of time (the

$11 million is a lump-sum estimate rather than an annualized

value) to compare with company revenues and determine impact to

the firm.

Comment: One commenter (IV-D-44) stated that reformulation

cost estimates can be very difficult to determine and vary on a

case-by-case basis. Another commenter (IV-F-1e) has been working

to reformulate products for approximately 4 years and still has

over 24 products, excluding various colors, that are not in

compliance with the proposed regulation. These products

represent $7.4 million in sales which is over 9 percent of the

commenter's gross sales. The commenter believes the list will be

reduced to 15 products not in compliance by April 1, 1997. These

products represent $6.7 million in sales. 

Response: The EPA recognizes that each regulated entity

will have different impacts from the rule, based upon the number
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of products they offer, the types of products they offer, and the

current VOC content of such products. The EPA has considered

this information on the cost of compliance along with other

submittals in determining the cost of the final rule. The

summary of the EPA’s analysis of reformulation cost comments is

presented in Appendix A. The EPA notes that the extended

compliance time and other mechanisms in the rule will provide

compliance flexibility to regulated entities, beyond that

discussed in the proposed rule.

Comment: One commenter (IV-F-1m) asserted that costs for

minor reformulations are not free and that some costs should be

assigned for those minor formulations involving one-third of the

products over the standards. 

Response: The economic analysis conservatively assumes that

all reformulations, regardless of how far the current VOC content

is above the limit will necessitate a “major” reformulation. 

Thus, there are no minor reformulations that are assigned zero

costs. The “one-third” adjustment indicated in the analysis

reflects the assumption that, for a typical company,

approximately one-third of all over-limit products are similar

enough in characteristics to other over-limit products, that a

separate reformulation effort will not be necessary. So, for

example, if a firm has 15 products that are above the VOC limit,

it will, on average, have to develop 10 new formulations. These

assumptions were derived based on information presented to the

EPA by industry during the regulatory negotiation. Because the

EPA cannot assess the exact number of reformulations that each

regulated entity will need to perform, and regulated entities

themselves may not know in advance, the EPA believes that this is

a reasonable means to estimate the number of reformulations

conservatively.

Comment: One commenter (IV-F-1m) stated that it is

misleading for the EPA to use the annualized value of

reformulation to represent the cost of reformulation. For

example, the commenter compared the EPA’s annualized approach to

that of a Mercedes Benz dealer taking out ads to sell cars, which
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other dealers are selling for $40,000, and claiming that they

only cost an annualized amount of $2,800. Instead, the commenter

suggested using actual costs expended both to formulate and to

make all of the other changes necessary to produce and market a

new product. 

Response: The EPA believes an annualized value for

reformulation is appropriate because the costs of reformulation

and its VOC reduction benefits occur in different time periods. 

The reformulation of current noncompliant products is a “one-time

event,” but the emission reductions of the new formula persist

over time. It is a well-established tenet of benefit-cost

analysis and cost-effectiveness analysis that benefits and costs

need to be placed on a time-consistent basis for direct

comparison (see OMB guidance for implementation of Executive

Order 12866, part III.A.3). Therefore, the costs of the action

must be computed on an annualized basis through discounting to be

time consistent with the annual stream of emission reductions

achieved.

To use, as the commenter suggests, the entire lump sum

reformulation cost estimate as a measure of annual costs of the

rule is conceptually incorrect. It would be similar to using the

entire purchase price of a home as the cost of housing in the

year that a house is purchased.

The commenter takes issue with the annualization formula

used in the analysis, which implicitly assumes that the VOC

reduction technology has permanent emissions reduction benefits. 

The commenter likens this to suggesting that the real cost of a

$40,000 Mercedes Benz is only $2,800. However, the analogy is

inappropriate. A car must be replaced periodically and,

therefore, must be amortized over a finite service life. A

technology to reduce VOC does not need to be replaced in the

future and, thus, does not have a finite service life in the same

way that a car or other capital equipment does. In that regard,

the annualization method used in the EIA is appropriate for VOC

technology, but not for cars.
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The EPA recognizes that a case can be made for treating each

product formula as having a finite service life, requiring

periodic reformulation. Under this alternative assumption, it

should be pointed out that the regulation can be viewed as

accelerating each product’s next round of reformulation, an event

that would have occurred anyway. This alternative assumption

(i.e., a product formula having a finite life) is addressed in

more detail and its effects are quantified in Appendix B to this

document.

As Appendix B indicates, the one-time cost estimate of an

accelerated reformulation schedule ranges from a small fraction

to a large fraction of the total reformulation cost estimate used

in the EIA. In this example, the average product’s one-time cost

equivalent is less than 60 percent of the estimate used in the

EIA. Thus, the EPA’s estimate of one-time costs of roughly

$250,000 for each over-limit product overstates the true costs in

all cases and, as demonstrated in the example above, the

overstatement of costs can be substantial. Taken together with

the fact that the $250,000 lump sum expenditure is likely an

overstatement of the costs to reformulate to achieve a lower VOC

content, the EPA’s methodology for assigning costs appears to

greatly overestimate the costs per product, rather than

underestimate these costs as the commenter suggests.

Comment: One commenter (IV-D-128) estimated its company's

aggregate cost to reformulate the few products affected by the

rule to amount to $85,000 over a 2/3 year period, with a

potential cost of approximately $9,000 per ton of VOC emissions

reduced. The commenter noted that these products represent a

shrinking part of their market and that the wasted reformulation

costs will impact their ability to develop very low (or zero) VOC

coatings.

Response: The commenter appears to have estimated annual

costs of approximately $28,000 ($85,000/3) and divided this

number by 3 tons per year of VOC reduction to get the $9,000 per

ton estimate. However, as indicated in the previous response to

comment IV-F-1m, this method for annualizing costs is
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conceptually incorrect because the initial lump sum cost of

$85,000 should be matched with reductions achieved in all future

years, not just the first 3 years when the $85,000 is expended. 

If the $85,000 cited here were annualized using the method from

the EIA, the annualized cost would be approximately $85,000*.07 =

$5,950 which divided by 3 tons per year gives an annual cost per

ton of emissions reduction of roughly $2,000. Assuming that

these numbers provided by the commenter are accurate, the

commenter has four basic choices: (1) withdraw the few products

that do not meet requirements and represent a shrinking part of

the company’s market, (2) claim some portion of these products as

exempt under the tonnage exemption, (3) reformulate a portion of

the products, or (4) pay the exceedance fee. With an exceedance

fee of approximately $2,500 per ton, it would seem to be less

costly to reformulate than to pay the fee, as long as annual

profits exceed the total annual cost of reformulation (the EIA

assumes that a product would be withdrawn if profits do not

warrant the expenditure for reformulation).

Comment: One commenter (IV-F-1m) disagrees with the EPA's

first reformulation cost estimate (i.e., the reformulation cost

estimate presented in the June 1996 EIA) because it is calculated

on a per-volume basis rather than on a per-product basis. The

commenter disagrees with the EPA's second reformulation cost

estimate (i.e., the sensitivity analysis of the national

reformulation cost estimate presented in Appendix D of the EIA)

because it assumes that the average number of products needing

reformulation will increase as the company size increases. The

commenter states that the number of products needing

reformulation will actually increase as the company size

decreases. The commenter also did not understand why the average

number of reformulations per small business participating in the

survey is 7.8 whereas the average number of reformulations per

business for the companies not participating in the survey is

about 3. 

Response: The EPA recognized potential problems with the

per-volume approach of determining the number of products that
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need reformulation and, therefore, presented it as a lower bound

estimate of costs in the sensitivity analysis presented in

Appendix D of the June 1996 EIA for the proposed rule. The

second approach -- presented in Appendix D - has a per-product

basis for determining the number of products requiring

reformulation and is presented as an upper bound estimate. The

final EIA only uses the per-product approach for the estimation

of national costs.

Although the survey data confirm that larger companies have

a greater number of products needing reformulation than smaller

companies, that is not the basis of the methodology for the perproduct basis cost estimate. First, for each product category,

the volume of non-surveyed products is computed as the difference

between the national sales volume for that category and the

corresponding volume of surveyed products. Then, the number of

non-surveyed products is estimated by taking the non-surveyed

volume and dividing by the average product volume size (total

nationwide volume per product category) for surveyed products

produced by small companies in that category. The underlying

assumption is that the small companies surveyed were more

representative of the non-surveyed companies. Then, the EPA

estimated the number of over-limit non-surveyed products by

taking the proportion of all products in that category that are

over the limit and multiplying by the number of non-surveyed

products. This number is then subject to the “one-third”

adjustment and multiplied by the reformulation cost per product

to get the total reformulation cost for the category. Then each

product category has a separate reformulation cost estimate for

surveyed and non-surveyed products. The national estimate is

derived by summing the surveyed and non-surveyed totals across

all categories.

Using the methodology just described, the EPA determined

that a large portion of the non-surveyed products are in

categories that have a low proportion of products that are over

the regulatory VOC content limit (e.g., exterior waterbornes and

interior waterbornes). This is because these categories
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represent a large portion of the total sales volume that was

under-reported in the survey. Therefore, the average rate of

reformulation for non-surveyed products was calculated to be

lower than the average reformulation rate for surveyed small

company products.

Comment: One commenter (IV-D-178) stated that a model

$10,000,000 per year sales volume company cannot survive the cost

of reformulating its product lines. The commenter questioned the

EPA's estimated reformulation cost of $17,772/product. The

commenter asserted that the primary cost of reformulating is

paying a chemist to do the work at $80,000 per year. In

addition, the commenter claimed the cost is expressed in 1991

dollars which doesn't apply to real costs today. The commenter

also asserted that the cost estimate assumed an interest rate of

7 percent which is not a valid assumption for small businesses

and also assumes that a company is in the position to borrow

$267,908 for reformulation which may not be true of all

companies. According to the commenter, the economic analysis also

failed to consider the impact of lost sales on the survival of a

business as it approaches its break-even point. 

Response: The EPA cost estimate is based on an estimate of

one reformulation taking 2.5 years of a chemist’s time at

$100,000 per chemist year. At proposal, this was then

annualized, as described in the text of the EIA and in responses

to comments above, to derive the $17,772 estimate. The

commenter’s assertion that a chemist year costs $80,000 suggests

the EPA may have over estimated reformulation costs.

Because the survey of architectural coating producers was

conducted in 1992 with information on products through the end of

1991, the EPA has set 1991 as the baseline year for the analysis. 

All market data are therefore in 1991 dollars, so for the purpose

of modeling, the costs are expressed in 1991 dollars. The EPA

notes that transforming these costs to 1998 dollars would not

appreciably change the impact in real terms.

The Office of Management and Budget (OMB circular A-94)

stipulates that the discount rate used for economic analyses of
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federal regulations is 7 percent. This is based on an assessment

of a wide range of private and public investment returns. OMB’s

7 percent is a real discount rate (adjusting out inflation). In

contrast, the market interest rates paid by firms are in nominal

terms (i.e., they include a component for inflation). If

inflation is 3 percent, then a real rate of 7 percent is

equivalent to a nominal rate of 10 percent. All dollar values in

the economic analysis are expressed in real terms, thus the

discount rate used is a real discount rate.

Finally, the EIA does estimate the value of reduced output

that results from product withdrawals and price increases. These

estimates are the total value for a market category. The EPA

does not have sufficient information to determine the break-even

point of an individual firm or to estimate a specific firm’s loss

in sales. The EPA believes, however, that the final rule

includes a variety of mechanisms that will provide sufficient

flexibility to regulated entities yet at the same time achieve

meaningful VOC emission reductions.

Comment: One commenter (IV-D-57) stated that small regional

and local companies may not be able to reformulate their products

cost-effectively. Another commenter (IV-D-143), a small business

manufacturing wood finishes, requested that instead of providing

a per-product exemption, the rule simply exempt all very small

businesses (under $1 million in annual sales) so that a company

could generate enough funds to reformulate its products. Under

the commenter's suggestion, once a company reaches the $1 million

mark, the company would have to comply before 2 years pass or an

additional $500,000 in sales accrue. The commenter asserted that

despite the benefit to its company, an exemption of specific

products could lead to abuse and rule circumvention by regulated

entities.

Response: The EPA shares the concern of the commenters that

the final rule should allow companies of all sizes to meet the

requirements in a cost-effective manner. Section 3 of the

proposal EIA identified, and to the extent possible, quantifies

potential impacts on small firms. This analysis has been revised
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given changes to the final rule and has been augmented by a final

analysis to meet the requirements of the Regulatory Flexibility

Act as amended by the Small Business Regulatory Enforcement and

Fairness Act. The analysis shows that because reformulation

appears to be a fixed amount no matter how much or how little

volume is produced, small firms who generally have smaller volume

products may experience reformulation costs that are a greater

percent of their baseline cost and revenue. Rather than

exempting a particular size company entirely from regulation, the

EPA has taken several steps to alleviate the burden on industry

including:

& the creation of new product categories where

warranted,

& an extension of the period of compliance after

promulgation to allow for reformulations, 

& a scaled tonnage exemption in years 1 and 2, and

all future years of compliance, and 

& an exceedance fee provision.

All of these provisions were considered to address niche markets

and small business burdens, however, the provisions will be

available to all producers, regardless of size. 

Comment: One commenter (IV-D-147) stated particular cost

concerns regarding products requiring both reformulation and

color recalibration. The commenter noted that any reformulation

of a tint base system requires the recalibration and

reformulation of every color in that system as well as the

additional custom color standards of customers. Consequently,

this has a greater impact on a product line than would individual

product reformulation. As a related issue, the commenter

requested some exemption from the rule that is commensurate with

their production volumes. The commenter favored a small volume

exemption for all categories combined since it would lessen the

amount of recordkeeping and reporting. 
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Response: The EPA has included a scaled tonnage exemption

in the final rule which will help respond to particular

situations where it may not be cost-effective for a manufacturer

to reformulate specific product lines -- in this case products

requiring color recalibration. In addition, the commenter could

consider the cost of reformulation and color recalibration versus

the payment of the exceedance fee to help gain additional time to

complete reformulation efforts for some products.

2.3.2.2 Annual Cost to Industry

Comment: One commenter (IV-D-190) stated that the EPA

failed to consider several important factors in calculating

economic impacts of the proposed rule. The commenter claimed

that the EPA overestimated the cost of compliance because the EPA

has not completed a systematic account of new paint, coating and

resin technologies. Also, the commenter asserted that the EPA

failed to include in its analysis other economic benefits

associated with low-VOC technologies, such as decreases in costs

for health insurance cost for workers producing low-VOC

technologies, and the fact that since most low-VOC coatings dry

more quickly, the amount of time facilities are unavailable for

use may be reduced compared to their counterparts painted with

high-VOC coatings. The commenter also claimed that the EPA

failed to consider that American jobs may be created due to

increased coating technology demand in foreign markets as a

result of the rule. 

Response: In calculating the number of products expected to

need reformulation, the EPA relied on data from a survey which

was conducted by the National Paint and Coatings Association

during the regulatory negotiation to gather 1990 sales and VOC

content information on the architectural coating industry. The

results from this survey are considered to be the most

comprehensive source of information about VOC and sales

information collected on this industry to date. Although much

progress in lower VOC technology is expected to have occurred

since the 1990 survey data were collected, the EPA does not have

the resources to continually evaluate and document such progress
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and must, therefore, rely on information available through survey

efforts, State regulations, and comments submitted during the

public comment period. Based on comments submitted at proposal

about the cost to reformulate, the EPA has revised (lowered) the

cost of reformulation to reflect this new input, but has not

accounted for changes in coatings technology since 1990.

The economic impact analysis (EIA) focuses on the size and

distribution of costs of the proposed regulatory action. The EIA

qualitatively discusses several effects of a product

reformulation on product performance such as drying time, and

other characteristics, but is unable to quantify such effects on

each product’s performance attributes. If such quantification

were possible, the comment raised here regarding improvements in

drying time for low VOC products would be evaluated along with

the several public comments regarding adverse effects of

reformulation on product performance to determine whether the net

performance effects are positive or negative. The EPA is aware

of examples of better performing lower VOC content coatings, but

because no comprehensive source of data on coating performance

exists, the EPA assumed no net benefit or harm from any changes

in coating performance as a result of regulation.

Because all producers (foreign and domestic) must comply

with the requirements of the rule, it was assumed there would be

a minimal impact on foreign trade. Typically, U.S. regulations

impose increased costs of production on domestic producers only,

which puts them at a disadvantage compared to foreign producers

operating in U.S. markets. However, in this case all producers

(foreign and domestic) will face the same level of costs for

their respective U.S. markets. Thus, only minimal effects will

occur as a result of product withdrawals by producers (foreign

and domestic) that do not find it efficient to continue to offer

a product to the U.S. market - which allows other producers to

meet the demand of these product withdrawals.

It is true, as the commenter suggests, that new technology

will result from the rule. However, the EPA is not aware of a

current demand in foreign markets for this technology. The only
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demand that can be assumed is from potential future requirements

by other governments to reduce the VOC content of architectural

coatings. If an analysis of trade effects were conducted, the

EPA would evaluate the impacts of its rule holding the state of

the world markets constant (at baseline conditions), so potential

future foreign requirements would not be evaluated. Thus, the

trade effects that result from this rule are likely to remain

minimal as was assumed at proposal.

Comment: One commenter (IV-D-08) questioned the EPA's

estimated cost to society of $25 million per year as being

extremely low because, among other costs, the estimate supposedly

fails to take into consideration reporting and recordkeeping

costs and costs to the EPA. The commenter, based in Ohio,

claimed that its company experienced costs in excess of

$1 million to convert or change over 15 percent of its products

for compliance with current State rules, and estimates that costs

to the industry have already been in the billions of dollars.

Another commenter (IV-F-1e) also maintained that the EPA's

$25 million dollar cost estimate is too low. The commenter alone

reportedly has over $7.8 million dollars in fees and costs

($4 million dollars for products already reformulated, $100,000

for discontinued product lines, $800,000 for exceedance fees, and

$2.7 million to reformulate additional products).

Response: The commenters appear to be comparing the EPA’s

annualized cost estimate ($17,772) with their own estimate of the

initial, lump sum costs of reformulation. The EPA’s conservative

one-time cost estimate at proposal was $250,000 per product. 

Therefore, for firms with four or more products that need

reformulation, the lump sum might be $1 million or more as the

first commenter suggests. These costs should, however, be

considered on an annualized basis. The EPA computed its

annualized cost estimate by first assuming that reformulation

will initially require an investment of approximately $83,000 per

year for three years, for a total of $250,000 over three years. 

Because reformulation is the development of intellectual property

applicable to all future sales, rather than just sales in those
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first three years, the initial cost needs to be capitalized over

time to appropriately match costs with the resulting annual

reduction in VOC emissions.

Comment: One commenter (IV-D-26) stated that the high costs

associated with having to comply with the proposed rule for the

portion of their products that do not meet the proposed standards

(100 out of 1400 formulations) would at least initially require

the California-based company to pay the exceedance fee surcharge

in lieu of reformulation. Given that the company produces highend niche products, the commenter predicted that the resulting

increase in product price would drive customers to purchase less

of the company's products in favor of less costly alternatives. 

In a related statement, the commenter supported a 5,000 gallon

per year low volume exclusion to reduce the burden of

reformulating low volume products.

Response: As an initial matter, the EPA notes that a

California-based company likely has to meet more stringent limits

for sales in that State and presumably already has developed the

technology to comply with the final rule. The EPA has added a

compliance option to the final rule in addition to the exceedance

fee provision that the commenter will be able to use. 

Specifically, the EPA has included a scaled tonnage exemption of

23 megagrams (25 tons) through the end of the year 2000,

18 megagrams (20 tons) in the year 2001, and 9 megagrams

(10 tons) in the year 2002 and all future years, which helps

respond to particular situations where it may not be costeffective for a manufacturer to reformulate specific low-volume

product lines.

It should also be noted that the market model the EPA

developed for the architectural coatings rule shows that on

average, prices will not increase by a significant amount

(0.01 percent) and consumption will not drop by a significant

amount (0.01 percent). Furthermore, given these low percentage

changes in price and consumption, the level of substitution is

expected to be low (i.e. there are expected to be few products

which lose markets as a result of this rule). 
2-324

Comment: One commenter (IV-D-214b) stated that the EPA's

estimated cost understated or ignored the most significant costs

of the proposed rule, which would result in the expenditure by

the private sector of more than $100 million in 1 year. The

commenter contended that the EPA's estimate of manufacturers'

reformulation costs was seriously flawed and contradicted by the

EPA's own work. The commenter calculated manufacturer

reformulation costs to be $905 million per year based on the

EPA's estimated VOC emissions reduction of 182 thousand tons per

year at a cost of $5,000 per ton. The commenter stated that this

cost estimate was close to the $930 million per year estimate of

OTA in 1987 (taken from the EPA's 1981 draft CTG). The commenter

continued by calculating a cost estimate based on $20 thousand

per reformulation, 500 manufacturers, and 12.6 reformulations per

manufacturer.

Another commenter (IV-D-55) stated that the threshold of

section 202(a) of the Unfunded Mandates Reform Act (UMRA) was

easily met for the architectural coatings rule considering: (1)

the government's own estimates of phase one manufacturer

reformulation costs; (2) the costs arising from the inability of

most manufacturers to reformulate most of their products; (3) the

costs manufacturers would bear under any phase two substitution

regime; (4) costs borne by retailers; (5) costs borne by

contractors; (6) costs borne by workers; and (7) costs borne by

consumers. The commenter contended that there was an urgent need

for an UMRA cost-benefit assessment, especially with regards to

the anti-competitive and the adverse environmental effects

associated with the proposed architectural coatings rule.

One commenter in two letters (IV-D-214b, IV-D-214c) took

issue with the EPA’s statement in the proposal preamble that the

proposed rule “does not contain a Federal mandate that may result

in expenditures of $100 million or more for ... the private

sector in any 1 year.” Id. At 32745-46. In the first letter, the

commenter (IV-D-214b) pointed out several major adverse economic

effects to the private sector that were not addressed in the

revised draft preamble: (1) increased costs to retail businesses
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(estimated at 40,000 paint retailers each with an annual cost of

$2,500); (2) increased costs to painting contractors due to

product failures and increased labor; (3) increased costs to

consumers (estimated at 1 percent of total architectural coatings

sales of $10 billion); and (4) adverse effects on paint industry

workers (estimated at 5,000 lost jobs paying $20,000 per year). 

The commenter concluded that when the two manufacturing effects

that the EPA underestimated and the four effects the EPA refused

to evaluate are combined, the proposed architectural coatings

rule exceeded the $100 million per year threshold of UMRA.

According to the commenter in the second letter (IV-D-214c),

the EPA failed to address not one, but 13 key cost factors in

determining that there was no possibility that its proposed rule

“may” cost the private sector $100 million or more and the

commenter discussed those 13 factors. The commenter also

referred to several court decisions that involved judicial review

of an administrative determination that the threshold for a

statutory mandate had not been met. The commenter concluded that

if the EPA had counted the following 13 relevant factors that the

UMRA surely would have been triggered:

1. The EPA did not count cost data from all manufacturers.

2. The EPA only considered reformulation costs.

3. The EPA’s calculations omitted the costs of most

reformulations the average manufacturer will have to

pay.

4. The EPA’s annualized cost estimate of $17,772 per

reformulation is too low.

5. The short deadline will make many of the reformulations

infeasible.

6. Reformulation may be financially infeasible due to

capital constraints for small firms.

7. The commenter suggests that lacking data, the preamble

speculates that estimated market effects of the

regulation are relatively slight and relatively little

product volume is projected to be withdrawn from the

market. The commenter refers to these points as

assumptions and also suggests they are affected by
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definitional manipulation of 50 product categories into

13 markets.

8. The EPA ignored a formulation’s “property value.”

9. The EPA failed to measure “stigma” changes arising from

the threat of imposing more stringent substitution

limits.

10. The EPA did not consider the impact on the 42,000

retail outlets referenced in the BID.

11. The EPA did not consider the impact on the 29,900

coating applicator firms referenced in the BID.

12. The EPA did not consider the employment impacts for any

group except manufacturers.

13. The EPA ignored the effect of “product bans” on reduced

competition, fewer choices, and lower quality.

Response: The EPA disagrees that the UMRA threshold of

$100 million is exceeded by the final rule. The EPA estimates the

annual impact of the rule is $32 million (in 1996 dollars). The

commenter’s calculation of a reformulation cost of $950 million

is based on a cost of $5,000 per ton of reduction and a reduction

of 182,000 tons. The commenter claims these figures are from

EPA’s own analysis. The EPA’s analysis estimates the rule will

result in a cost of $250 per ton of reduction and the emission

reduction from the final rule is 113,500 tons. Consequently, the

EPA is unsure the source of the commenter’s figures. The

commenter’s calculation of reformulation cost using $20,000 per

reformulation and 12.6 reformulations per manufacturer is not

consistent with information available to the Agency about the

number of reformulations and the cost. The EPA’s calculation

methodology is detailed in the response to items 2, 3, and 4 that

follows below. The EPA understands the desire of the commenters

to expand the scope of impacts to increase the amount of the

impacts, but does not believe that this overestimation is

consistent with appropriate evaluation of the impacts of the

rule. The EPA used the best available data to determine the cost

of the regulation. Below is a response to each of the 13 cost

factors mentioned by the commenter.
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1. The EPA did not count cost data from all manufacturers.

The EPA disagrees with the commenter. Regulatory costs were

estimated based on information from the regulatory negotiation

process (July 28, 1993, Docket# II-E-52) and from a survey of

manufacturers that represented roughly 75 percent of industry

volume. For those manufacturers who did not respond to the

survey, the EPA conservatively estimated costs at proposal in two

ways. First, the EPA calculated costs for manufacturers not

represented in the survey by taking the regulatory costs for

manufacturers who provided responses and multiplying these costs

by a ratio of total product volume in the industry (respondents

and non-respondents) to surveyed product volume. These results

were reported in the economic impact analysis and were used as a

lower bound for the cost estimate. For the second method used to

calculate costs for manufacturers not represented in the survey,

the EPA estimated the ratio of total products in the industry to

those included in the survey per category to estimate national

reformulation costs. The results were reported in Appendix A of

the economic impact analysis. Because this second method

produced a larger number of products that needed reformulation,

the EPA used these costs as an upper bound. 

2. The EPA only considered reformulation costs.

The cost estimates provided at the regulatory negotiation

meeting (presentation by Carl Minchew of Benjamin Moore & Co. on

July 28, 1993, Docket# II-E-52) not only included costs for

reformulation, but also costs for technical and market testing. 

Table 2-1 of the EIA lists all potential costs that are not

quantified along with bias factors, positive or negative. This

comment relates to the potential downward biases in the cost

estimate associated with non-R&D cost, but it does not recognize

the upward biases to the cost estimate presented by formulations

that are less expensive than the assumed dollar amount for a

major reformulation, and the potential for technology

advancements that reduce costs in the future. The cost estimate

presented at the regulatory negotiation meeting (July 28, 1993,

Docket# II-E-52) was based on the assumption that resources would
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be needed to research and develop entirely new formulations to

meet proposed standards (rather than modifying existing

formulas). These new formulations were expected to be based on

available resin technology that a manufacturer had not yet worked

with within their respective company for a particular product

line. The costs presented in this presentation were based on

potential rule requirements (including up to three phases of

control implemented in an 8-year period) that far exceed those

ultimately proposed by the EPA or ultimately included within the

final rule. Consequently, it is expected that the estimates

presented by industry significantly overstate the costs and time

frames needed for a reformulation. Based on public comment

received upon proposal and the regulatory negotiation

information, the EPA revised its cost estimate to reflect the

average of all the cost estimates received. 

3. The EPA’s calculations omitted the costs of most

reformulations the average manufacturer will have to pay. 

Regulatory costs at proposal were estimated based on

information from the regulatory negotiation process and from a

survey of manufacturers that represent roughly 75 percent of

industry sales volume. Costs were then extrapolated to the

national level to provide a complete estimate of the surveyed and

non-surveyed population. 

It is unclear in the comment what is meant by “the costs of

most reformulations.” If this refers to the approach for

estimating minor reformulations as opposed to major

reformulations, the EPA believes that all assumptions used in the

EIA lead to a conservative estimate of national costs. First,

the EPA chose the conservative approach of basing reformulation

costs on 1990 coating VOC content data to determine the number of

products exceeding the proposed VOC standard which required

reformulation in response to the EPA’s national rule. The EPA

conservatively assumed that for all products that exceeded the

VOC content levels in 1990, 67 percent of the reformulations

would be major involving significant investment in research and

development over a 3-year period. Thirty-three percent would be
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able to rely on the significant investment in research and

development for the other reformulated products, and consequently

would require a relatively minor effort. For purposes of the

cost and economic analysis, these “minor reformulations” were

assumed to be so similar to other formulations that the

manufacturer would not incur any costs for these modifications in

coating formulas. In most cases, an estimate based on 1990 data

that assumes 67 percent of the coatings that did not meet the

standards in 1990 would require a major reformulation expense in

1998 provides a conservatively high estimate of the level of

effort necessary for a manufacturer to meet the VOC requirements

proposed. This is because lower VOC technology has progressed

over the past 8 years from the 1990 survey data base year in

response to consumer demand, State regulations, and impending

Federal requirements. Second, in many cases, the cost of

reformulation is expected to be partially reduced through the

assistance of resin manufacturers/suppliers. Upon request, most

resin suppliers are willing to share information as well as

sample low VOC coating formulations with interested paint

manufacturers, both large and small.

Overall, the assumption that the per product reformulation

cost is $250,000 and that 67 percent of the products produced

that were over the VOC limit based on 1990 inventories will

undergo a major reformulation leads to a conservatively high

estimate of national cost.

4. The EPA’s annualized cost estimate of $17,772 per

reformulation is too low.

The EPA’s calculation of annualized cost uses principles

that are defined by OMB Circular A-94 which provides the EPA with

guidance on rule development procedures including cost analysis. 

This guidance requires all costs and benefits to be discounted to

their present values using a period of time that corresponds to

the occurrence of benefits. In the EIA, the EPA computed costs

by considering that reformulation will initially require an

investment of approximately $250,000 total or $83,000 per year

over a 3 year period. Because reformulation is the development
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of intellectual property (i.e., low-VOC technology) that is

applicable to all future sales of the product, rather than just

the sales in the first 3 years, the EPA amortizes the

reformulation cost over the service life of the product, which is

infinitely into the future. The EPA recognizes that individual

products may be reformulated again in the future, so that the

life of an individual formulation is not infinite. However, the

VOC reduction technology developed in response to the standards

is expected to be applicable (i.e. be a “building block”) to all

future modifications of the current formula. Therefore, the

effective life of this investment can be interpreted as the

effective life of the manufacturing firm itself. Since the value

of a firm is typically computed as the present value of its

perpetual earnings stream, the initial reformulation investment

was amortized as if it were an infinite-lived annuity.

The EPA recognizes that a reasonable case can be made that

the service life for a reformulation should be shorter than the

effective life of the firm. If, for example the typical product

reformulation cycle is every 8 years it could be argued that the

appropriate time period for annualizing costs and benefits is

8 years (which does not account for the fact that the accrual of

knowledge in these formulations is carried to every future

formulation). Under this situation, the regulation does not

actually force firms to reformulate, rather it causes them to

reformulate sooner than they would otherwise. This does impose

some costs on the manufacturer, but the incremental costs

attributable to the regulation are then much lower than the

estimate derived using the EPA’s methodology at proposal. A

demonstration of this point is provided in Appendix B. The

example quantifies the difference in costs under an assumption of

an infinite life and one that would assume an 8-year life of a

product formula. The example demonstrates that the one-time cost

of a product assumed to have an 8-year life is less than

60 percent of the $250,000 estimate used in the EIA. Thus, the

EPA’s methodology used in the EIA at proposal is likely to

overstate the costs by a substantial amount. Taken together with
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the fact that the $250,000 lump sum expenditure is likely an

overstatement of the costs to reformulate most products, the

EPA’s methodology for assigning costs at proposal appears to

greatly overestimate the compliance costs per product. 

5. The short deadline will make many of the reformulations

infeasible.

The regulatory negotiation process indicated that it could

take up to 3 years to develop an entirely new product. It is

likely that less time is required to modify existing formulas to

comply with the standard since the VOC limits are similar to

requirements in place in a number of States that hundreds of

manufacturers have been meeting for years. The EPA also received

many public comments on the compliance date which are summarized

and discussed in section 3.2.5. Based on these comments, the

final rule allows 1 year to comply with the standard. Companies

that need additional time can use the tonnage exemption provision

or the exceedance fee option until reformulation can be completed

for all products.

6. Reformulation may be financially infeasible due to

capital constraints for small firms.

The EPA does not have the financial data from individual

(privately owned) manufacturers to analyze the issue of the

comment quantitatively. In the EIA, the EPA uses several

assumptions to evaluate the impact on small manufacturers. Table

3-5 of the EIA at proposal illustrates that the estimated

compliance cost for the average small business represents

3 percent of the sales for the manufacturer. Because this burden

could be limiting to some small firms, the EPA consulted with the

Small Business Administration (SBA), which suggested two

significant changes to the EPA's proposal. First, the SBA asked

that the EPA establish its proposed exceedance fee at $2,500 per

ton. Second, the SBA requested that the EPA include a small

volume "exemption" for product lines below a certain size. As a

result of these suggestions from the SBA, the EPA has

incorporated several elements into the final rule to alleviate

the burden on small entities. First, as discussed previously,
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the final rule includes a tonnage exemption that allows

manufacturers and importers to sell or distribute limited

quantities of coatings that do not comply with the VOC content

limits. This exemption is described in detail in

section 2.2.1.2. The final rule also has a provision for an

exceedance fee payment for manufacturers and importers. This is

an economic incentive approach that allows compliance by paying a

fee in lieu of meeting the applicable VOC content limits. The

fee payment is $2,500 per ton of excess emissions above the

limit. The details of this provision are described in

section 2.4. Both of these provisions essentially allow

manufacturers to gain additional time to reformulate products

(i.e., claiming the exemption or paying the fee until the

reformulation occurs). The EIA indicates that several of the

manufacturers with low product volumes would take advantage of

the fee, and reduce the compliance costs by a substantial amount. 

In general, smaller manufacturers tend to have smaller sales

volumes per product line and, therefore, would be more likely to

take advantage of the exceedance fee payment provision. In

addition, the VOC limits in the final rule are similar to those

in place in New York, New Jersey, Massachusetts, and Oregon. 

Over 100 manufacturers, both large and small, compete in those

markets.

7. The commenter suggests that lacking data, the preamble

speculates that estimated market effects of the regulation are

relatively slight and relatively little product volume is

projected to be withdrawn from the market. The commenter refers

to these points as assumptions and also suggests that they are

affected by definitional manipulation of 50 product categories

into 13 markets.

The EPA’s small market quantity and withdrawal quantity

estimates are not assumptions, rather they are projected

outcomes, based on policy simulations run through the

architectural coatings market model described in the EIA. 

Withdrawals occur when product-level profits are insufficient to

cover reformulation costs. Using this methodology, approximately
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1.4 percent of all products are projected to withdraw when the

exceedance fee is included as a compliance option. The volume

associated with these withdrawals is estimated to be less than

one-tenth of 1 percent of total market volume (p. 2-37 of the

proposal EIA). Furthermore, withdrawn product volumes may be

partially offset by increased production of similar non-withdrawn

products.

The EPA divided categories into 13 market segments to mirror

the market segments used by the U.S. Census of manufacturers SIC

product codes. This enabled the EPA to obtain quantity and price

data at the national level. Because the Census product codes did

not match exactly with the product groupings from the VOC

emissions inventory survey, a cross-referencing method was

devised for linking Census categories to survey categories. This

cross-reference method is defined in appendix A of the proposal

EIA. Often the Census categories were defined heavily upon the

coatings use (e.g., SIC 2851163: Interior flat solvent wall

paints and tinting bases), while the survey categories were

defined primarily on technology (e.g., Flat, interior - solvent

borne). Thus, multiple Census codes typically had to be

aggregated to correspond with an aggregation of survey product

codes before a meaningful correspondence could be established

(e.g., interior solvent borne). The EPA’s objective was to

specify as many market categories as the data would allow. Using

this method, the largest possible number of meaningful market

categories was 13. As a result, the aggregation process may make

it difficult to detect relatively large impacts within one

subgroup of a market category, if these impacts are offset by

relatively small impacts in other subgroups. In other words, a

product may be more likely to be withdrawn from the market than

is indicated in the 13 market segments of the analysis since

multiple product niches would be lumped within the same market

segment. On the other hand, this aggregation may increase the

estimated effect on manufacturers by over-stating the degree to

which products within the market segment can substitute for

products affected by the regulation. Notwithstanding these
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limitations, the aggregation process presents an appropriate way

to analyze the cost and economic impacts and does not in any way

diminish the estimates of the absolute impact of the regulation.

8. The EPA ignored a formulation’s “property value.”

At any one time, an asset’s (property’s) net present value

is based on the flow of net profits generated by that property

over time. Since the EPA’s analysis estimates the effect of the

regulation on annual profits per product, the analysis directly

estimates the formula’s property value. The comment seems to

suggest that the EPA should also estimate annualized changes in

asset value for the product formula, which is a subset of the

measure of profits. Because this would create a double-counting

of effects -- profits and asset value -- the EPA only measures

changes in profits.

9. The EPA failed to measure “stigma” changes arising from

the threat of imposing more stringent substitution limits. 

The EPA interprets this comment to relate to the potential

future phase of regulation discussed in the June 25, 1996

preamble [A61 FR 32729]. The EPA is not aware of “stigma”

damages that will result from a discussion of potential future

regulation of the architectural coating industry. The commenter

has not provided enough detail to allow the EPA to consider the

issue further.

10-12. The EPA did not consider impact on the 42,000 retail

outlets referenced in the BID. The EPA did not consider impact

on the 29,900 coating applicator firms referenced in the BID. 

The EPA did not consider employment impacts for any group except

manufacturers.

While the EPA did not directly measure impacts on the

retailing sector and other consumers, the indirect impacts to

these entities and other users of coatings products are captured

in the market analysis by the estimated change in “consumer”

surplus, along with all other downstream effects beyond the

manufacturer. Consumer surplus is the measure of utility (or

benefits) consumers (retailers, contractors, home-owners, or any

other architectural coating user) receive for the supply of a
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product at a certain price and quantity. When prices increase

and output falls as a result of a regulation, this measure is

reduced to a certain extent. The estimated change in consumer

surplus is estimated in the EIA to be a reduction of $3 million

under the proposed limits and a reduction of $6 million if the

rule includes the exceedance fee provision. Since the impact on

consumers is less than one-third of the manufacturers’ burden,

and contractors and retailers are a small subset of this effect,

the EPA saw no indication of a need for a special analysis of

secondary impacts.

It should be recognized that retail outlets have the ability

to substitute between compliant and noncompliant coatings offered

for sale. While the EPA projects the number of withdrawn

products to be small, if a manufacturer does choose to

discontinue a product, retailers will presumably replace this

product with other compliant products in that category. Thus,

although foregone profits are “lost” for the manufacturer

withdrawing a product, the retailer offsets any lost profits from

selling the withdrawn product with profits obtained by selling

substitutes within that category. As indicated above, the number

and volume of product withdrawals is projected to be quite small,

thus suggesting retailing effects, if they exist at all, are also

likely to be quite small. 

The job loss and other substantial economic impacts that are

referred to by the commenter are the result of assuming that

every reformulation required by the standards is not feasible,

thus the products would be taken from the market causing

manufacturers, contractors, retailers and other consumers to be

economically impacted. According to the EIA, there are a very

limited number of products that are expected to be withdrawn from

the market. Most products will be reformulated or produced with

current compliant formulations (with some manufacturers using the

tonnage exemption provision or paying the exceedance fee for

emissions in excess of the standards). 

13. The EPA ignored the effect of “product bans” on reduced

competition, fewer choices, and lower quality.
 One method to evaluate industry competitiveness is by 2

examining the concentration of firms in the industry. An

industry consisting of very few firms would have a high

concentration measure, while a competitive industry would have

several firms and a low concentration. The Herfindahl-Hirschman

Index (HHI) provides a scaling of concentration from zero

(perfect competition) to one (pure monopoly). The HHI for the

Paints and Allied products SIC code is 0.0305, which indicates an

industry structure close to perfect competition.

(Source: 1992 Census of Manufacturers; report M92-S-2,

“Concentration Ratios in Manufacturing)

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The proposed regulatory action is not a product ban because

it is technically feasible to reformulate all product categories

to meet the standards. The EIA indicates that only 1 percent of

the products will be removed from the market because the cost to

reformulate would exceed the profits obtained from the product. 

This level of withdrawal is the aggregate of numerous varieties

of products across 13 different market segments, so it is

unlikely to eliminate (or ban) an entire product category. At

proposal, the EPA specifically sought public comment on niche

products needing any special attention. The EPA considered

comments received and as a result added seven categories to the

final rule. The rule contains limits for 61 categories of

products, many of which were created, in part, to preserve

specialty, niche market sectors within the industry; most of the

new categories added since proposal are low-volume. Also, no

product is “banned” since the tonnage exemption and exceedance

fee provisions in the rule are expected to provide further

compliance flexibility which will allow manufacturers to maintain

product lines with VOC contents that exceed the VOC content

levels of the final rule. Consequently, the resulting effect on

industry competition is also likely to be very small. Compared

to other industries, the coatings industry is highly competitive

due to the numerous manufacturers in the industry . Therefore, a 2

relatively small product withdrawal effect on a very competitive

industry suggest that significant degradation of market

competition is unlikely.
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As discussed in section 2.2.4.1 of this BID, high performing

products are available in a wide range of VOC content levels in

many product categories.

Comment: One commenter (IV-F-1b) believed that the EPA's

cost estimates for compliant product development is too low,

especially for industrial maintenance coatings and other

specialty areas where liability and product

functionality/acceptability is more precise and requires more

detailed, time-consuming, and costly testing. The commenter also

pointed out that there is the cost of foregone new product

development when expending scarce technical effort to reformulate

existing products.

Response: The EPA’s cost estimate is assumed to be an

average and, therefore, may underestimate costs in some cases and

overestimate costs in other cases. Public comments have provided

numerous estimates suggesting that average (one-time)

reformulation costs per product are well below $250,000 (see

Appendix A), and the EPA has adjusted its analysis to reflect all

of the information received during the public comment period.

For industrial maintenance coatings, the EPA’s VOC limit is

consistent with existing limits in many State regulations and is

not as stringent as limits in some California districts. In New

York and New Jersey manufacturers have been meeting a similar VOC

limit for almost 10 years.

The cost of foregone new product development is an aspect of

opportunity cost that is implicitly included in the EPA’s

estimate of economic impacts. The amortized cost of

reformulation reflects both the payment of principal and the cost

of capital. The cost of capital directly reflects the value of

opportunities foregone by investing funds in a particular

activity, in this case, reformulation. Thus, if investing in

reformulation diverts funds from investing in other product

enhancements, the foregone value of those investments is captured

in the discount rate used in the analysis. Per guidance from the

Office of Management and Budget (57 Fed. Reg. 35613 [1992],

proposed August 10, 1992), a real discount rate of 7 percent is
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used to capture the opportunity cost of capital invested in

environmental compliance.

Comment: One commenter (IV-D-128) asserted that as a result

of the rule, the company would have to divert formulation

resources, which include those for high-solids or zero VOC

products, to reformulating products in a shrinking part of the

company's market. The rule reportedly will strain the company

and may result in higher VOC emissions because of lost

opportunity to develop lower-VOC products. The commenter

believes that lack of regulation would have actually resulted in

less VOC emissions.

Response: The economic impact estimate does include the

opportunity costs of funds spent on reformulation, however, there

are no specific assumptions about what those opportunities might

be. A firm in this situation will have many alternatives

available to them. Instead of reformulating the products in the

shrinking market, the firm could utilize the exemption or fee

options to keep the products on the market at existing levels, or

the company could discontinue production of these products

earlier than they would otherwise.

2.3.2.3 Costs not Considered

Comment: One commenter (IV-D-16) expressed concern that the

EPA focused on reformulation costs, but appeared to ignore costs

associated with reporting, recordkeeping, labeling, and

manufacturer education. Another commenter (IV-D-115) asserted

that costs such as research and development, product impact and

exposure studies, labeling, and recordkeeping cannot accurately

and fully be anticipated and budgeted.

Response: The EPA did include appropriate costs in the

total impacts of the rule. Research and development are included

as part of the cost of reformulation. Reporting and

recordkeeping costs are estimated separately and added to social

costs from the EIA to generate an estimate of total national

costs of the regulation.

The reformulation cost included in the EIA at proposal did

not include labeling and manufacturers’ education program costs. 
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However, the average of the cost estimates submitted in the

public comments, which did include labeling and education costs,

was substantially less than the reformulation costs used by the

EPA in the analysis at proposal (see Appendix A). Therefore, the

EPA believes that omission of these cost components in the

proposal analysis did not cause an understatement of national

costs. In any case, the analysis for the final rule has been

refined to reflect public comments which included labeling and

education costs (costs for retraining sales professionals on the

use and application of reformulated products and for holding

seminars and meetings for customers to ensure that they

understand the contents and applications of the reformulated

products).

Comment: One commenter (IV-F-1e) asked if the EPA included

litigation costs due to increased safety hazards from using

acetone formulations into the determination of the financial

impact.

Response: The EPA did not consider case-by-case examples of

how material substitution would alter product attributes, safety,

or liability. There are substitution possibilities other than

acetone, so if safety factors in the case of this commenter

outweigh the benefits of acetone, other raw materials should be

considered in the formulations. 

Comment: One commenter (IV-F-1[l]) mentioned the added

costs of facility modification, obsolete label inventories, lost

business resulting from a poor performing product and not being

able to produce a compliant product.

Response: The EPA has considered all comments on the cost

of complying with the regulation in its final report titled,

“Economic Impact and Regulatory Flexibility Analyses of the Final

Architectural Coatings VOC Rule.” The commenter does not provide

any description of the costs of facility modifications that would

result from the rule, and no other commenter has reported any

such costs. Thus, the EPA is unable to verify that this would be

a cost associated with the rule and cannot include an estimate in

its analysis. The EPA believes that due to the year lead-time a
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vast majority of existing label inventories will be utilized

prior to the effective date of the rule. Finally, the EPA is

unable to quantify any potential changes in performance due to

lack of data, but describes these effects qualitatively in the

EIA recognizing that the impacts can be positive (i.e., better

performance) or negative depending on the specific product and

the specific manufacturer. The EPA does, however, take into

account the impact of product withdrawals on the industry and

finds the impact to be relatively slight (i.e., less than

1 percent are withdrawn nationally).

Comment: One commenter (IV-F-1m) maintained that the EPA

should consider the costs for preparing product literature,

including material safety data sheets, sales aids, color

brochures, and technical data bulletins. Another commenter

(IV-F-2) stated that the EPA's cost estimates should include the

costs associated with warranty claims and complaints about poor

performance of lower VOC coatings. Based on the experience of

one of the commenters (IV-F-1m) in California, newly formulated

products brought to the market with less than 3 to 5 years of

field testing suffer from higher than normal rates of product

failure. The commenter stated that policy adjustments and

product liability settlements are often many times the cost of

reformulation. The commenter also noted that the consumer would

be paying higher costs per gallon and higher cost per unit of

area coated. The commenter pointed out that the cost per unit of

time in the service life of coatings may be higher. Higher

application costs may result from impacts on both labor and

equipment. Special training in the use of new materials is often

required along with more surface preparation, more priming, more

finish coating, more touch-up and repair work, and more frequent

recoating overall. New materials may require the replacement of

existing application equipment with more specialized equipment.

Response: Product literature costs are included in the

estimates provided in the public comments, as is discussed in

Appendix A.
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The comment implies that the new products would be

systematically inferior to existing products and, therefore,

would subject manufacturers to increased liability. The EPA is

not aware of any widespread evidence that low VOC products

systematically incur greater product liability costs than

products above the VOC limit.

The economic analysis does project that prices will increase

to a small extent as a result of the regulation.

It is not clear that application costs will rise, on

average. The EPA was unable to measure quantitatively

differences in qualities of compliant versus noncompliant

products. Table 2-1 of the EIA qualitatively shows the possible

cost biases of the potential differences. The commenter

qualitatively suggested what he believes would cause increases in

costs, but did not supply supporting data. Nevertheless,

table 2-1 shows that the change to compliant products could have

either an upward or downward cost bias. An example of a downward

bias is possible lower application and drying time with

waterborne coatings than with solventborne coatings. 

Comment: One commenter (IV-F-1e) stated that alternate

solvents for low VOC coatings cost $2-4 per pound versus 10 to 20

cents a pound for traditional solvents. The commenter stated

that industry is not going to absorb all the cost for this

regulation and asked who is going to pay for this increase in

product cost.

Response: At the outset of the analysis, the EPA was unable

to obtain verifiable information on material cost effects of

reformulation. Anecdotally, it was suggested that solventborne

material costs might rise in some situations (e.g., those

described in the comment), but might fall in others (e.g.,

substitution of water carriers for solvent). The net effect

across all products is unknown. Without sufficient data on the

size or direction of material cost effects, the EPA recognized

that the effect can go in both directions, but assumed no net

material cost effects in the quantitative analysis.
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2.3.2.4 Cost-effectiveness

Comment: One commenter (IV-D-96) stated that it is

important to characterize cost-effectiveness in a consistent

manner so that various alternative control strategies can be

compared on equal footing. The commenter asserted that

calculating cost-effectiveness based solely on nonattainment

areas unfairly biases the calculation by ignoring the benefit of

reducing the transport of ozone and its precursors. The

commenter supported calculating the cost-effectiveness on a

national basis, which would amount to $237 per ton, which is low

compared to VOC RACT costs which can exceed $5,000 per ton. 

Another commenter (IV-D-33) advised the EPA to maintain the

traditional measure of offering a $/ton comparison, since it is

commonly used and will continue to provide meaningful

comparisons. The commenter opposed more narrow measures of costeffectiveness, such as exclusively measuring the effect on ozone

concentrations, or the reductions in ozone nonattainment areas. 

Another commenter (IV-D-162) considered cost-effectiveness based

on VOC content reductions solely in ozone nonattainment areas to

be impractical, because the manufacturer has little control over

where the coatings will be used. It would thus require

additional recordkeeping to track intended and actual locations

of use.

Response: In the preamble to the proposed rule

(61 FR 32735, June 25, 1996), the EPA solicited comments on

alternative approaches to the cost-effectiveness calculation for

the proposed rule.

Cost-effectiveness, i.e., the cost per ton of emissions

reduced, is a measure used to compare the cost efficiency of

alternative strategies for reducing pollutant emissions, or to

provide a comparison of a new strategy with historical

strategies. The EPA’s established method of calculating the

cost-effectiveness of a rule with nationwide applicability is to

divide the total cost of the rule by total emission reductions. 

At proposal, the EPA requested comment on two alternative ways of

calculating cost-effectiveness for the architectural coatings
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rule: (1) cost-effectiveness considering total emission

reductions in ozone nonattainment areas only, and (2) costeffectiveness considering emission reductions in ozone

nonattainment areas during the ozone season only.

After considering the comments summarized above, the EPA

does not plan to adopt these alternative approaches to

calculating cost-effectiveness for rules with nationwide control

requirements, for reasons that are presented below.

One issue raised by the comments is whether the EPA’s

traditional measure creates a bias against strategies that apply

in a limited geographic area (e.g., in nonattainment areas)

relative to nationwide strategies, or against seasonal strategies

relative to year-round strategies. This issue would arise if the

EPA used cost-effectiveness figures to compare the desirability

of these dissimilar types of strategies. In fact, the EPA did

not use cost-effectiveness estimates in this way in developing

the architectural coatings rule and does not plan to do so for

other rules or guidance being developed under section 183(e). In

the case of the architectural coatings rule, the EPA considered

applying restrictions to architectural coatings only in

nonattainment areas (either by rule or through a CTG). The EPA

determined that such geographically targeted restrictions for

these nationally distributed architectural coatings would pose

substantial implementation difficulties for government, would

impose substantial compliance burdens on a large number of

regulated entities, and would be less effective at reducing

emissions than a national rule. Given that a strategy applicable

only to nonattainment areas is not practical or desirable for

architectural coatings, the EPA did not see a need to invest

resources to pursue that strategy and calculate its costeffectiveness.

The EPA considered whether use of one of the alternative

cost-effectiveness methodologies would enable the EPA to make

valid cost-effectiveness comparisons between nationwide and

targeted geographic strategies, or year-round and seasonal

strategies, for reducing ozone pollution. The EPA has the
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following concerns about the two alternative approaches: First,

VOC emission reductions have benefits other than reducing ozone

levels in nonattainment areas. As a result, the EPA believes the

cost-effectiveness calculation for a nationwide, year-round rule

should not exclude VOC emission reductions in attainment areas or

outside the ozone season. The EPA recognizes that a primary

objective of section 183(e) of the Act is to reduce VOC emissions

in ozone nonattainment areas. However, as previously explained,

in the development of the architectural coatings rule, the EPA

found that the best policy alternative is to implement a

nationwide rule. Therefore, emission reductions from this rule

will not only be realized in ozone nonattainment areas, but also

in all other parts of the country in which architectural coatings

are distributed and consumed.

In general, the benefits of VOC reductions in ozone

attainment areas include reductions in emissions of VOC air

toxics, reductions in the contribution from VOC emissions to the

formation of fine particulate matter, and reductions in damage to

agricultural crops, forests, and ecosystems from ozone exposure. 

Emission reductions in attainment areas help to maintain clean

air as the economy grows and new pollution sources come into

existence. Also, ozone health benefits can result from

reductions in attainment areas. The closure letter from the

Clean Air Science Advisory Committee (CASAC) for the recent

review of the ozone NAAQS states that there is no apparent

threshold for responses to ozone exposure [See U.S. EPA; Review

of NAAQS for Ozone, Assessment of Scientific and Technical

Information, Office of Air Quality Planning and Standards Staff

Paper; document number: EPA-452\R-96-007]. In other words,

reactions to ozone have been found at concentrations below the

current standard (0.12, 1 hour), and the revised standard (0.08,

8 hour). 

Second, under either alternative approach, emission

reductions in ozone attainment areas would not be included in the

calculation of a rule's cost-effectiveness. The implicit

assumption is that emissions reductions in attainment areas do
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not contribute to cleaner air in nonattainment areas. In fact,

NO emitted long distances away can affect ozone levels in x

nonattainment areas. In some circumstances, VOC sources outside

nonattainment area boundaries contribute to ozone levels in

nonattainment areas. As a result, a cost-effectiveness

comparison based on the alternative approaches sometimes could

create a bias against a nationwide rule relative to a strategy

that applies in nonattainment areas only.

In light of the transport issue, it has been suggested that

the EPA apply a weighting factor to account for differences in

the extent to which emissions inside and outside nonattainment

areas contribute to ozone formation in nonattainment areas. The

EPA is concerned that in order to calculate cost-effectiveness

using this concept, the EPA would have to conduct extensive and

costly air quality modeling to estimate ozone reductions

resulting from each candidate control strategy and that this

would require extensive data on the location of emissions. Such

detailed analysis is appropriate for some policy decisions, but

not for all. As a result, the EPA is skeptical that this

weighting approach would represent a generally useful analytical

tool for decision making.

The EPA, of course, agrees that differences in the location

and timing of emission reductions are a significant consideration

in choosing among alternative strategies. The extent of ozone

reductions and other benefits resulting from VOC emission

reductions varies, partly based on location and season. In

considering nationwide vs. geographically targeted controls, and

year-round vs. seasonal controls, the EPA considers available

information on the effectiveness of those strategies in reducing

ozone--as well as other health and environmental considerations,

economic considerations, and other relevant factors--in making a

holistic assessment of which strategy is most desirable from an

overall public policy standpoint.

There are instances where the EPA does provide an estimate

of cost-effectiveness of a control strategy during the ozone

season, i.e., generally, when a control strategy is feasible to
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apply on a seasonal basis, or when limits are set on a seasonal

basis. Although these figures are useful for comparing different

seasonal strategies, the EPA does not plan to use costeffectiveness figures to compare seasonal and year-round

strategies for the 183(e) program for the reasons presented

above. In regard to the architectural coatings rule, the EPA

notes that the nature of architectural coatings emissions does

not allow for control strategies that reduce emissions only

during the ozone season to be an objective for consideration. 

One reason is that the shelf life and consumption rate of

architectural coatings varies greatly and one cannot predict that

a certain percentage of a product made with a specified

formulation will be consumed and, thus, result in VOC emitted

during the ozone season. Due to the fact that reductions only

during the ozone season is not a viable control strategy for

architectural coatings, the EPA cannot endorse a seasonal

approach to measuring cost-effectiveness for the architectural

coatings rule. 

Comment: One commenter (IV-D-16) expressed concern that the

EPA supports the regulation of products when there is little, if

any, cost-effectiveness to doing so.

Response: The EPA believes that the commenter’s concerns

are misplaced. The EPA favors controls that are cost-effective,

when it is possible to do so from a policy and legal perspective. 

The EPA often compares the relative cost of different measures

for controlling a pollutant by calculating the

"cost-effectiveness" of the measures. Using the EPA's

traditional calculation methodology, the cost-effectiveness of a

regulation that applies nationwide is based on a comparison of

national costs and nationwide emission reductions. This

comparison is expressed as the cost per Mg (or ton) of emissions

reduced. The EPA has assessed the cost-effectiveness of the

architectural coatings rule. Using the estimated cost of

$28 million (in 1991 dollars) and emission reductions of

103,000 Mg (113,500 tons), the nationwide cost-effectiveness of

the architectural coatings regulation is $270 per Mg ($250 per
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ton). This compares favorably with emission reductions from

other 183(e) rules, including consumer products at $256/Mg

($233/ton) in 1991 dollars and automobile refinish coatings at

$140/Mg ($130/ton). The cost per ton of reductions from each of

these rules is far more cost-effective than other sources of VOC

reductions that can range up to thousands of dollars per ton. 

The EPA notes that Congress recognized consumer products

(including paints and solvents) as a source for cost-effective

reductions of VOC emissions when in enacted section 183(e) of the

Act.

2.3.2.5 Disproportionate Impacts on Small Businesses

Comment: Using the State of California as an example, one

commenter (IV-D-02/IV-F-1l) claimed that the architectural

coatings regulation would impose a devastating impact on small

businesses. According to the commenter, since the California

rules have been in effect, more than half the paint manufacturers

in Northern California have closed. The commenter proposed that

the EPA revisit a document that was presented during the Reg-Neg

process entitled "ICF Study Summary, Small Business Economic

Impact Study” final report, released in June 1988. This study

examined the impact of a number of SCAQMD's rules, including its

architectural rule, on small businesses. Another commenter

(IV-D-115) remarked that the shutdown of hundreds of paint

manufacturers is at least in part due to the costs or physical

constraints associated with increased environmental regulations.

One trade association (IV-F-2) representing 30

manufacturers, of which 20 are small businesses, conducted a poll

of their members and gathered the following data on the impacts

of regulation: (1) 10 to 50 percent of product lines were

discontinued or replaced by new formulations as a direct result

of the California regulations; (2) 64 percent of the companies

lost market share, which resulted in a loss of revenue of

$250,000 per year; (3) 27 percent of the companies lost market

share, which resulted in a loss of revenue of greater than

$1 million; and (4) 80 percent of the companies said that their
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product complaints had increased since the regulations took

effect, resulting in costs of $250,000 per year per company.

The commenter also cited the results of the 1988 ICF study

of SCAQMD, which the commenter claimed established that: 

(1) National coating companies specialize in water-based

products; (2) smaller coating companies specialize in higher

performance solvent-based products; and (3) smaller companies

produce the coatings that are regulated and, therefore, bear the

bulk of the cost of the regulation. In addition, the commenter

stated that even though it may appear that only a small

percentage of products require reformulation under the proposed

rule, these products may be key for a small business to maintain

viability. 

The commenter (IV-D-214b) stated that product removal or

withdrawal costs were more substantial than the EPA estimated,

especially for those costs that would be incurred under a second

phase of regulation. The commenter asserted that the discussion

of removal costs in the draft architectural coatings preamble was

devoid of merit. First, the commenter stated that the EPA

treated the impacts of product removal as if they did not exist

by aggregating multiple categories in a few meaningless segments. 

The commenter asserted that proposed limits of 250 or even

350 grams per liter would effectively remove traditional glossy

alkyd enamels from the market. The commenter cited examples of

paint companies being sold at a loss because of California rules

banning traditional glossy alkyd enamels. The commenter stated

that as a result of California's VOC limits for traditional

glossy alkyd enamels for general purpose use, his family's

company lost sales, was forced to discharge a large percentage of

their work force, had difficulty raising debt and equity capital,

and lost fair-market value. The commenter continued that the

EPA's projection that less than 0.1 percent of product volume

would be withdrawn from the market as a result of the proposed

rules was too low. The commenter cited the 1988 ICF SCAQMD

commissioned study which, according to the commenter,

demonstrated that only a few regional and local manufacturers
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were expected to survive regulation of architectural coatings by

SCAQMD Rule 1113. The commenter estimated that there were

500 small or regional paint manufacturers with aggregate sales of

about $2.5 billion a year. The commenter asserted that the

adoption of the proposed architectural coatings rule would reduce

the estimated aggregate profits and company value by hundreds of

millions of dollars, largely as a result of lost sales and

profits from product removals.

Three commenters (IV-D-44, IV-D-110, IV-D-147) predicted

large undue burdens for many small manufacturing companies due to

reformulation, especially those with a small chemist staff. One

commenter (IV-F-1[l]) stated that small businesses that only

manufacture and sell in attainment areas do not contribute to

ozone non-attainment and should not have to bear the cost of

reformulating their products if the real intent of the rule is to

reduce the potential of paint emissions to contribute to ozone

levels that violate the NAAQS.

Another commenter (IV-D-02) stated that the proposed

regulation has the effect of discouraging niche market formations

which are a mainstay for small businesses. The commenter also

stated that the regulation places undue resource burdens on the

small business, and it appears that because of this the

regulation's effects favored large paint manufacturers.

One commenter (IV-D-175) stated that the rule will

discriminate against the small business because large companies

have greater resources and chemist staffs. The commenter claimed

that the proposed rule threatened to put small businesses out of

business.

Two commenters (IV-D-115, IV-D-147) predicted that

manufacturers of products will not be able to compete with

national manufacturers with larger resources and experience in

VOC-compliant manufacturing.

One commenter (IV-D-130) requested that the EPA consider the

significant financial impact of the rule on their small familyowned business and other small businesses. This small business

reportedly manufactures and sells one waterborne and six solvent
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borne formulations of form release compounds in both attainment

and non-attainment areas. The commenter indicated that two of

its solvent-borne compound formulations would not meet the

proposed VOC standards. According to the commenter, at least one

of these products cannot be reformulated and will have to be

discontinued. The commenter stated that his small business will

lose $600,000 in gross sales over the next 3 years if one product

cannot be reformulated; $1.5 million in gross sales if both

products have to be discontinued. The commenter also estimated

that the additional costs of testing, reformulation, technical

help, labeling, liability, etc., would total $38,800. The

commenter added that many of these items are one-time costs, but

for a small company they are significant.

One commenter (IV-D-178) stated that many small businesses

will be eliminated by the VOC limits in the proposed rule. The

commenter was concerned that a number of its products could not

comply with the proposed limits. The commenter estimated that it

will require a minimum of 10 man-years to reformulate all of

these products. Because the commenter only has two chemists

working full time and cannot afford to hire an additional

chemist, the commenter considered the January 1, 1997 compliance

date is unrealistic.

One commenter (IV-F-1l) stated that small companies

typically have limited funds, less than $100 million in sales,

and less than 500 employees. The commenter noted that small

companies tend toward specialties and niches, that uniformity

eliminates specialties and niches, and that large companies

desire uniformity. The commenter noted that small companies have

limited staffing for research and development and for

administrative requirements, have limited data processing

abilities, and are often family-owned and operated. The

commenter believed that regulation would eliminate niche markets,

increase administrative requirements such as record keeping and

labeling requirements, and consume research and development time

to formulate complying products to replace products in order to

stay in business, therefore eliminating R&D time for formulating
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new products for growth. The commenter also asserted that

regulation consumes sales time educating customers of the rule

requirements and methods to apply compliant coatings and

increases the rate of product failures and rejects, therefore

increasing waste and inventory obsolescence. The commenter

claimed the following effects of California's rules: death of

several paint industry executives due to heart failure, stroke,

and suicide; daily violations of rules by many businesses; scores

of businesses driven from the State and country; and negative

impacts on air quality.

Another commenter (IV-F-1h) stated that the architectural

coatings rule will cost small business a lot of money so the rule

should be based on sound science, facts, and risk-cost benefit

analysis. 

One commenter (IV-D-55) stated that the publication of the

proposed architectural coating rule would adversely affect many

small businesses by making the industry aware that certain

products may no longer be produced in the near future. The

commenter stated that this would affect specifiers because they

would be uncertain about the availability and performance

qualities of certain specialty and high-performance coatings. 

The commenter stated the proposed architectural coating rule

would create hardship on companies because they would need to

consider changing raw materials, manufacturing processes, etc. 

The commenter stated that the potential for additional study and

amending of the proposed rule created uncertainty which might

cause small companies to conclude that their only recourse was to

seek out a merger or consolidation.

Another commenter (IV-F-2) likewise expressed concern about

the ability of small businesses to comply with the rule. This

manufacturer reportedly has about $6 million in annual sales,

less than half of which is architectural coatings. The company

sells coatings in all 50 States, but 80 to 85 percent of these

sales are in California. The company specifically targets its

sales in the unregulated areas in California. The commenter

indicated that all of the company's products are relatively low
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volume. This small coatings manufacturer produces coatings in

29 different coating categories. Within the 29 categories, 30 to

40 products would have to be reformulated to meet the proposed

standards. The commenter operates close to the break even point

and has gone from one chemist to five chemists. 

Response: The EPA understands the concerns of small

businesses regarding compliance with the rule and has made

adjustments in the final rule to address their concerns. The EPA

notes, however, that comparisons to the effect of California

regulations, even if they were correct, are not appropriate given

the different VOC content limits of the final rule and existing

regulations in California. The existing rules in California

generally require lower VOC contents than the limits in this

rule. Because the national regulation is generally not as

stringent as existing California district regulations, there

should be no incremental impact on small producers selling in

California markets. These producers may experience impacts from

the national rule if they sell in non-California markets and have

not found a way to produce lower VOC coatings since the

California limits were put in place. Notwithstanding the

concerns expressed by the commenters, the existing rules in

California do not appear to have eliminated the paint industry in

that State. Based on a 1990 survey of the manufacturers that

sell architectural coatings in the California market, there were

149 small businesses with total company sales less than

$50,000,000 that participated in that market compared to 25 large

manufacturers with total company sales greater than $50,000,000.

Several statutes provide guidance for the EPA to consider

the impacts of its regulations on small firms. The EIA report

for proposal identified and, to the extent possible, quantified

the impacts of a national rule on small producers in accordance

with the Regulatory Flexibility Act. This analysis has been

revised given changes to the final rule and has been augmented by

an analysis to meet the amendments to the Regulatory Flexibility

Act by the Small Business Regulatory Enforcement and Fairness

Act. Similar to the finding of the ICF report, the EPA’s analysis
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confirms that because compliance costs are fixed for all levels

of production (i.e., it is not reduced if the volume produced is

low), these costs comprise a greater share of baseline costs and

revenues for small producers. The EPA analysis also confirms

that small producers are more heavily represented in the higher

VOC categories. The EPA has considered these factors and the

comments received on the proposal in developing the final rule

and has included several provisions to address such concerns,

including:

& the creation of new product categories where

warranted;

& an extended period for compliance after

promulgation to allow for reformulations;

& a VOC tonnage exemption; and

& an exceedance fee provision.

All of these provisions were considered, in part, to

mitigate unnecessary adverse impacts of the rule upon small

businesses. The EPA notes that section 183(e) of the Act

instructs the EPA to obtain appropriate VOC emission reductions

from consumer and commercial products. In seeking to achieve

these reductions from the architectural coatings rule, the EPA

has adjusted the final rule in ways that it deems reasonable to

help to limit the impacts on small businesses. The analysis of

the final rule conducted by the EPA confirms that these

mechanisms will provide the intended compliance flexibility,

while still allowing the final rule to achieve necessary levels

of VOC reductions from this product category. 

The EPA’s rationale for controlling attainment areas is

provided in section 2.1.2 of this BID.

Comment: Two commenters (IV-D-212, IV-D-212p6k, IV-F-1l)

pointed out that smaller companies have a higher percentage of

coatings that may require reformulation because they tend to

produce niche market coatings that have higher solvent contents. 

One commenter (IV-F-1l) explained that smaller companies find it
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difficult to compete with the large companies on the more common

water-based paints because of their large batch sizes, better

purchasing power and other economies of scale, including

significantly increased sales dollars relative to R&D expenses. 

The commenter stated that a small company cannot pay $10 to

$15 million and spend 100- to 150-person years to reformulate

their coatings when there are only six person years available. 

According to the commenter, a small company can only look at a

few product lines and reformulate them and let the rest go to the

competition. The commenter predicted that half of the 400 to 500

companies with sales less than $10 million will be gone by the

year 2000 if the proposed rule were adopted.

The other commenter (IV-D-212, IV-D-212p6k) explained that

the large national and multinational paint manufacturers devoted

a high percentage of their product mix to waterborne paint

products and seldom attempted to meet the needs of local and

regional conditions. The commenter (IV-D-212p6k) stated that for

small regional companies, a higher percentage of special products

were made which the local market requested and required for their

particular needs. The commenter (IV-D-212) stated that the cost

of reformulation to these manufacturers would be substantial and

would force some companies out of business. 

Four commenters (IV-D-16, IV-D-26, IV-D-73, IV-D-110)

asserted that the rule would destroy solventborne niche markets

generally maintained by smaller producers, and would help foster

an anti-competitive and oligarchical setting in the architectural

coating industry.

Response: The EPA agrees that small companies do produce

many high-VOC products. The Regulatory Flexibility Analysis

(RFA) chapter of the proposal EIA report confirms that small

firms tend to produce niche products with higher VOC content. 

The report indicates that products from the small company segment

of the survey population are more heavily represented in high VOC

categories (specialization effect) and more heavily represented

in the high VOC products within categories (technology effect).
 Relative industry concentration is typically measured using a 3

Herfindahl-Hirschman Index (HHI). HHI is represented on a scale of zero

(perfect competition) to one (pure monopoly). The most recent HHI value for

SIC 2851: Paints and Allied Products is .0305, which indicates and industry

structure close to perfect competition (Source: 1992 Census of Manufactures

report MC92-S-2 “Concentration Ratios in Manufacturing”).

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The EIA assumes that if the cost of reformulation exceeds

the profits of a product, then a firm will choose the least-cost

option and will withdraw the product from the market. The report

found that given the fixed costs of reformulation (i.e., cost

does not vary with volume level) many of the smaller volume

products (that may or may not be produced by small firms) would

be predicted to exit the market. The EPA has included this in

its consideration to revise the rule to include the tonnage

exemption and the fee provisions, which will reduce the burden on

all firms.

The EPA estimates that just over 1 percent of the baseline

products will be removed from the market, so the potential effect

on industry competition appears to be very small. Compared to

other industries, the coatings industry is relatively

unconcentrated , which implies that it is highly competitive. 3

Therefore, a relatively small product withdrawal effect on a

relatively unconcentrated industry suggests that significant

degradation of market competition is unlikely. Thus, although

the EPA agrees with the commenters that many small companies make

higher VOC products, the EPA disagrees with the conclusion of the

commenters regarding the actual impacts of the architectural

coatings rule. The EPA’s analysis suggests that the alternative

compliance mechanisms in the final rule will mitigate the impacts

of concern to the commenters.

Comment: The commenter (IV-D-212) stated that in the

Regulatory Flexibility Analysis (RFA) for the architectural

coatings rule, the EPA attempted to justify cost data and its

effect on small business by analyzing only a small representative

pool of businesses (36 paint manufacturers). The commenter

asserted that the EPA made no attempt to supplement this
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information so that the economic analysis would be based on a

more complete set of data which was available at that time.

Response: The EPA’s analysis of small entity impacts

utilized data provided by the industry survey. The survey

includes detailed information on nearly 5,000 architectural

coatings produced by 116 manufacturers, 36 of which claim to be

small businesses. To preserve confidentiality, however, the data

were provided to the EPA at an aggregated level for the small

business sector. The small business component of the survey

provided the total number of products produced by these firms,

the VOC content of the products, and total sales volume (in

units, not dollars), but did not link any of this information to

specific firms.

With the survey information, the EPA was able to develop

impact estimates for a model small company. The model company

parameters were assigned by taking per company averages for the

36 surveyed small companies in the following categories:

& number of architectural products sold (27.5)

& number of non-compliant products (7.8)

& volume per product (66,400 liters)

And taken together with an average sale price of $2.52 per liter,

& coating revenue ($4.6 million).

This information was used to evaluate the impact of the

regulation on a model small entity. Impacts were initially

estimated by computing the ratio of the cost of reformulating all

non-compliant products to total revenue. The resulting

cost/revenue ration is 2.5 percent. This gives an upper-bound

estimate of average impacts, because it does not consider

compliance strategies that are less expensive than reformulation

(i.e., exceedance fee or product withdrawal). When those

strategies are factored in, the ratio drops to 2 percent. 

Moreover, this estimate is still biased upward in the sense that

it implicitly assumes that the firm is unable to increase prices

for the product to recover some of the additional cost.
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The EPA also obtained a list of other small businesses in

the industry and obtained total revenues for these firms. 

However, without specific information on the number of products

produced and their VOC content, there is no method to determine

the number of products that would incur reformulation costs. 

Unfortunately, assigning the model firm’s costs (based on 7.8

non-compliant products) does not produce a meaningful evaluation

of the distribution of small firms’ impacts. This occurs because

the calculation of cost/revenue ratios for these firms varies the

denominator (firm revenues) by firm, but the numerator

(compliance costs) remain fixed as those represented by the model

firm. Using this method, the estimated impacts would, by

definition, be relatively larger for firms with small revenues. 

However, it does not necessarily follow that a firm with low

revenues would have the same level of reformulation costs as a

firm with larger revenues and such an analysis would, therefore,

overstate impacts on the smallest firms. Therefore, for the

final rule, the EPA used the data from the 36 firms in the survey

to provide a representative look at model company small business

impacts, as described above.

Comment: One commenter (IV-F-1c) asserted that the proposed

rule was anti-small business. The commenter stated that the EPA

had not taken into account the impact of the rule on small paint

retailers. The commenter claimed that the effect of the proposed

rule on small business was not adequately addressed in the EPA's

analysis. The commenter asserted that the EPA decided not to

have the rule subjected to the new Reg Flex amendments which were

so important to the small businesses. The commenter also stated

that for small businesses the products affected represented a

higher percentage of: products, sales, profits, and cost of

reformulation.

Response: Section 3 of the proposal EIA identifies, and to

the extent possible, quantified potential impacts on small firms. 

The EPA’s analysis has been revised and improved given changes in

the final rule and has been augmented to meet the requirements of

the Small Business Regulatory Enforcement and Fairness Act. This
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analysis suggests that because reformulation appears to be a

fixed amount no matter how much or how little is produced, small

firms who generally have smaller volume products may experience

reformulation costs that are a greater percent of their baseline

cost and revenues. The EPA has taken several steps to alleviate

this burden, including:

& the creation of new product categories where

warranted, 

& an extended period of compliance after

promulgation to allow for reformulations, 

& a VOC tonnage exemption, and 

& the exceedance fee provision.

All of these provisions were considered, in part, to address

niche markets and small business burdens. 

While the EPA did not directly measure the impacts of the

rule on the retailing sector, which would include small dealers

in small towns as well as all other dealers, the indirect impacts

on these sources of price increases and lower product output is

properly reflected in the market analysis of the EIA by the

estimated change in “consumer surplus.” In general, consumer

surplus is the measure of utility (or benefits) consumers (i.e.,

retailers, contractors, home-owners, and other AIM coating users)

receive for the supply of a product to the market. When prices

increase and output falls for products in a market as the result

of a regulation, this measure is reduced to a certain extent. 

The EPA estimated that consumer surplus at proposal would

potentially be reduced by approximately $3 million if

reformulation was also the only compliance option, and by

$6 million if the fee provision is considered. Since the impact

on consumers is less than one-third of the burden on

manufacturers, and small dealers are a small subset of this

effect, it is likely the impact on small dealers will be minimal. 

Another indicator of a minimal impact on small dealers is the

fact that the analysis predicts that less than 1 percent of all
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products will be withdrawn from the affected markets. Although

some producers may decide to discontinue certain products, these

products will be produced by another manufacturer if demands

warrants it. Thus, retailers may see a change in the

manufacturer, but will still be able to sell such products.

Comment: One commenter (IV-D-52) stated that the EPA's

proposed VOC content limits would require virtually all small

paint manufacturers (except those who have long been regulated)

to cease making many of the products they desire to make. 

Response: The EPA disagrees that the rule will have the

severe impact feared by the commenter. The EPA’s analysis

suggests that the impacts will be limited. The EIA assumes that

a manufacturer will reformulate a product if it is economically

feasible, that is, if the profits of the product exceed the costs

of complying with the regulation. Using this criterion, the EIA

suggests that the vast majority of reformulations are

economically feasible, which is evident by the finding that only

1 percent of the products will be removed from the market because

the cost to reformulate would exceed the profits obtained from

the product. This level of withdrawal is the aggregate of

numerous varieties of products across 13 different market

segments, so it is unlikely to eliminate an entire product

category. In addition, the final rule contains 61 categories of

products, many of which will preserve specialty, niche market

sectors within the industry. Also, the tonnage exemption and

exceedance fee provisions in the rule are expected to provide

further compliance flexibility which will allow manufacturers to

maintain product lines with VOC contents that exceed the VOC

content levels of the standard. 

Comment: One commenter (IV-F-1e) estimated that

reformulation will take 1 to 2 years and cost at least

$150,000 per product line. The commenter stated that it will

need a minimum of $450,000 to reformulate. If the commenter does

not reformulate, it estimated that its exceedance fee will exceed

$4.4 million, a cost that it will pass on to its customers.
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One commenter (IV-D-189) emphasized the very diverse nature

of the architectural coatings industry, and the disproportionate

cost impacts the national rule will have on manufacturers. For

many companies, the commenter asserted that compliance with the

national rule will impose tremendous economic burdens. The

commenter noted that timing plays a key function regarding

determining cost of the rule's implementation; that is, the more

time provided for manufacturers to comply, the lower the cost for

most companies to implement the rule. The commenter recommended

that the EPA give more weight to the impact the national rule

will have, not only on unregulated areas, but currently regulated

areas as well. A currently regulated area with similar VOC

limits such as those in the national rule will benefit because

any end-use of out-of-State non-compliant products within the

currently regulated area would decrease.

Response: Based on this and other comments requesting

adequate lead time for compliance, the EPA is allowing a year for

compliance after promulgation. In addition, the final rule

allows a 23 megagrams (25 ton) of VOC exemption per manufacturer

in the time period from the compliance date through the year

2000, 18 megagrams (20 tons) in the year 2001, and 9 megagrams

(10 tons) each year for the year 2002 and all future years. If

additional flexibility is required beyond these provisions,

producers can pay an exceedance fee on any remaining products

that exceed the limitations. All of these measures are expected

to reduce the burden and cost to producers. In addition, the EPA

has also modified its reformulation cost estimate, taking into

consideration the costs provided by commenters (see

section 2.3.2.1 of this document).

2.3.2.6 Effect of Rule on Competition

Comment: Two commenters (IV-D-165, IV-D-166) stated that

the proposed rule would make their company's products

economically anti-competitive. Another commenter submitted four

letters (IV-D-212, IV-212p6, IV-D-212p6k, IV-D-212jj) claiming

that a national rule provides a competitive advantage for large

national and international companies over small regional and
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local companies. The commenter stated that the larger companies

market throughout the nation so a uniform national rule

simplifies marketing, production, and compliance activities. 

Also, the commenter claimed that the larger companies

predominantly produce waterborne coatings which already meet the

proposed limits so that these larger companies will not be

subjected to the costs of product reformulation and product

withdrawal. In contrast, the commenter claimed that most smaller

companies market in local regions that are in attainment with the

ozone standard and are not subject to VOC content limits. Thus,

in the absence of a national architectural coatings rule, these

companies would be unaffected by the problem of ozone

nonattainment. The commenter (IV-D-212p6k, IV-D-212jj) stated

that the larger companies have access to technology that provide

them with a competitive advantage in reformulating products. 

The commenter (IV-D-212p6k, IV-D-212jj) contended that the

National Paint and Coatings Association advanced a policy for a

national rule because it is composed primarily of large

manufacturers, and large manufacturers promote a national

architectural coatings rule because a national rule will provide

their companies with competitive advantages. The commenter

(IV-D-212, IV-D-212p6k, IV-D-212jj) implied that the EPA was

biased in favor of larger manufacturers and against the smaller

manufacturers. The commenter (IV-D-212p6k) cited “Catching Our

Breath, Next Steps for Reducing Urban Ozone” prepared by the

Office of Technology Assessment as an example of bias for the

larger manufacturers. The commenter noted that “Catching Our

Breath” recommended the regulation of architectural coating

products on a national basis and the only apparent representative

of the paint industry on the advisory panel was a representative

from one particular large company. The commenter asserted that

the imposition of regulations would have a very strong

competitive benefit on behalf of the large national companies

while having a severe economic impact on the many hundreds of

small paint manufacturers across the country. The commenter

(IV-D-212, IV-D-212jj) concluded that although the Act did not
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contain provisions conferring a competitive advantage to one

segment of the industry over another, the effect of the proposed

architectural coatings rule would extend a decided competitive

advantage to the large and international companies, which was

contrary to the express intent of Congress and the President of

the United States. Another commenter (IV-D-26) suggested that

the EPA has not worked closely enough with small paint

manufacturing companies, but instead worked closely with the

National Paint and Coatings Association.

One commenter (IV-D-212) noted that mergers in the paint

industry were being partly driven by increased regulatory

activity and threatened regulatory activity.

One commenter (IV-D-212jj) stated that a national trade

association observed during the Reg-Neg process that a

substitution of products would place its members at a competitive

disadvantage and drive many of them out of business. The

commenter also stated that the small business would be most

adversely affected if prohibition-type regulations were imposed

(most of the large national manufacturers focus almost

exclusively on water-based products). The commenter questioned

whether most large national and international companies favored a

Federal national rule for purposes of cleaning up the air or for

marketing and competitive purposes.

The commenter (IV-D-212p6k, IV-D-212jj) also claimed that

major national companies openly acknowledged that certain

individual companies may have favored such a policy for

competitive reasons. The commenter cited one large firm as an

example and stated that this company had access to technology

which would give it a competitive edge if it had a national

standard to which it could formulate. 

One commenter (IV-D-212p2) claimed that a substantial number

of companies in California were opposed to the proposed

regulations. According to the commenter, these regulations were

being used primarily for the purpose of achieving market

uniformity on behalf of large national and international

companies while causing a severe disadvantage to many local and
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regional companies, which could have anti-trust implications. 

The commenter (IV-D-214c) claimed the main effect of the proposed

rule would be severely anti-competitive, that the industry would

be controlled by “federal bureaucrats” and a few corporations. 

One commenter (IV-D-212) asserted that the proposed

architectural coatings rule was anti-competitive in nature,

pitting the small, local and regional manufacturer against the

national and international manufacturer. The commenter explained

that companies in attainment areas, who have heretofore been

unregulated, would be required to reformulate with new products

and would find it difficult to compete against most of the other

companies who would not be compelled to reformulate.

Response: The EPA disagrees with these comments which

suggest that the EPA intends the rule to favor large companies

over small companies, national companies over regional companies,

or any permutation thereof. The EPA intends the rule to achieve

necessary VOC emission reductions consistent with the provisions

of section 183(e). The EPA’s rationale for a national regulation

compared to a CTG is provided in section 2.1.2 of this BID, and

is based on the effectiveness in achieving reductions, not on

economic efficiency. 

As the EIA indicated at proposal, estimated market effects

from the architectural coatings rule are relatively slight for

all regulated entities under the rule. Approximately 1 million

liters of architectural coating products, accounting for less

than one-tenth of 1 percent of industry product volume, are

projected to withdraw from the market during the first year that

the architectural coatings rule goes into effect. Price effects

in each market are expected to range from no effect to an

increase of less than two cents per liter, which is still less

than a 1 percent increase of the baseline price. Average price

and quantity effects across all market segments were each less

than one-tenth of 1 percent of baseline values. Given the small

impacts of the rule on the industry as a whole, the EPA does not

believe that the rule will result in a significant competitive

advantage to any segment of the industry.
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The level of product withdrawal discussed above is the

aggregate of numerous varieties of products across 13 different

market segments, so it is unlikely to eliminate an entire product

category. In addition, the rule contains 61 categories of

products, 7 of which were added into the final rule based on

public comment and many of which will preserve specialty, niche

market sectors within the industry. Also, the tonnage exemption

and the exceedance fee provisions in the rule are expected to

provide further compliance flexibility which will allow

manufacturers to maintain product lines with VOC contents that

exceed the VOC limits set by the standard. The rule also exempts

products sold in containers of 1 liter or less. Consequently,

the resulting effect on industry competition is also likely to be

minimized. Compared to other industries, the coatings industry

is highly competitive due to the numerous manufacturers in the

industry. Therefore, a relatively small product withdrawal

effect on a very competitive industry suggests that significant

degradation of market competition is unlikely. Given the low

percentage change in price and consumption, the level of

substitution to other manufacturers products is expected to be

low. 

Finally, the EPA notes that the effect of the final rule is

not anticompetitive merely because those companies with low-VOC

products will have more limited costs of compliance. Those

companies have already expended resources to develop lower VOC

products and the rule is intended to encourage the development of

such products in the future.

Comment: Two commenters in three letters (IV-D-55,

IV-D-214b, IV-D-214c) stated that the EPA was required but failed

to assess the impact of the proposed rule on painting contractors

and independent retail dealers. One commenter (IV-D-214c)

claimed that the impact of the rule would have a profound ripple

effect in various related sectors. For example, instead of

choosing from many low-priced high-quality products supplied by

many manufacturers, a dealer might be forced to choose from a few

dominant manufacturers. According to the commenter, about 29,900
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painting contractors would be adversely impacted; most of the

26,100 workers in the paint manufacturing industry were employed

by those manufacturers adversely impacted by the proposed rule;

and consumers would face restricted choices, lower quality,

higher product costs, and higher labor costs as a result of the

rule. 

Response: The EPA disagrees with the conclusions drawn by

the commenters. The impacts on painting contractors and their

employees and the restricted choices to consumers that are

referred to by the commenter are the result of the commenter’s

assumption that every reformulation required by the VOC standards

is economically infeasible, thus the products would be taken from

the market causing manufacturers, contractors, retailers and

consumers to be substantially impacted. The analysis in the EIA

assumes that reformulation is economically feasible if the

profits of the product exceed the costs of reformulation. Given

this assumption, the EIA analysis suggests that only 1 percent of

the products will be removed from the market (prior to

consideration of the tonnage exemption and exceedance fee

provisions). This level of withdrawal is the aggregate of

numerous varieties of products across 13 different market

segments, so it is unlikely to eliminate an entire product

category and thereby limiting product choice. In addition, the

rule contains 61 categories of products, many of which were

created, in part, to preserve specialty, niche market sectors

within the industry. Thus, the EPA contends that the rule simply

will not have the effects feared by the commenters. The EPA’s

analysis indicates that the VOC content limits imposed by the

rule are reasonable and that the adverse impacts of the rule will

be limited.

While the EPA did not directly measure impacts on

contractors and other consumers, the indirect impacts to these

users of coatings products are captured in the market analysis by

the estimated change in “consumer” surplus, along with all other

downstream effects beyond the manufacturer. In general, consumer

surplus is the measure of utility (or benefits) consumers (i.e.,
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retailers, contractors, home-owners, and other paint users)

receive for the supply of a product to the market. When prices

increase and output falls for products in a market as the result

of a regulation, this measure is reduced to a certain extent. 

The change in consumer surplus is estimated in the EIA at

proposal to be $3 million under the proposed standard and

$6 million if a fee option is considered. Since the impact on

consumers is less than one-third of the manufacturers’ burden

(producer surplus), and contractors and retailers are a small

subset of this effect, the EPA saw no indication of a need for a

special analysis of such indirect impacts. Again, the EPA’s

analysis indicates that the overall adverse impact of the rule

will be limited.

Comment: One commenter (IV-D-177) expressed concern that

the proposed architectural coatings rule would have a negative

impact on the nation’s paint industry and on the nation’s ability

to compete in the global market place.

Response: Because all producers (foreign and domestic) must

comply with the requirements of the rule for paint sold in the

United States, it was assumed there would be a minimal impact on

foreign trade. Regulations which impose increased costs of

production on domestic producers only may put them at a

disadvantage compared to foreign producers operating in U.S.

markets. However, in this case all producers (foreign and

domestic) will face the same level of costs for their respective

U.S. markets. Thus, only minimal effects will occur as a result

of product withdrawals by producers (foreign and domestic) that

do not find it efficient to continue to offer a product to the

U.S. market. 

The demand U.S. manufacturers face for products abroad

should remain constant with or without the regulation on U.S.

products. Manufacturers who already sell their products in

foreign markets will not have to adjust formulations because of

the VOC content limits of the architectural coatings rule,

because exported coatings are not subject to the rule. 
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2.3.2.7 Economic Hardship

Comment: One commenter (IV-F-1e) is a nationwide company

that supplies a number of products and is known as a one-stop

supplier. The commenter noted that in California, when product

quality decreased on one product, sales declined on other

products. Also, the commenter stated that his company might lose

over $3 million in compliant top coat and base coat sales because

the primer could not comply with the limit set in the proposed

rule. Another commenter (IV-F-1h) believed the proposed

architectural coatings rule would force it to sell a lowerquality, higher-priced product and quality is very important to

it as a small company.

Response: The commenters did not provide sufficient detail

for the EPA to address the commenters' points specifically. As

noted earlier in this document, the EPA has no evidence that

products of acceptable quality cannot be manufactured at the VOC

content limits specified in the regulation. Furthermore, there

are multiple options under the final rule for the commenters,

including the option of reformulating, using the tonnage

exemption, or paying the exceedance fee. 

Comment: One commenter (IV-D-182) estimated that the

architectural coatings rule will cost it a total of $2,605,000

which would be a tremendous economic hardship. The commenter

explained that reformulation costs are difficult to estimate and

there are many "other" costs that they have no idea about how to

estimate. Their cost estimate includes: (1) reformulating

costs, (2) costs incurred due to lost business and lost new

product research, (3) costs for material storage tanks or space

for any special raw materials needed, (4) costs for collecting

and replacing labels, MSDS sheets, and product information

sheets, and (5) costs for training store employees and dealers. 

The commenter believes considerable additional cost that they

have no way of measuring at this time could arise due to poor

quality performance or premature product failure and complaint

adjustments to customers. According to the commenter,

implementation of the architectural coatings rule will shift its
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company's major focus from producing, marketing, and selling

quality paint to meeting the architectural coating regulations.

The commenter provided the following basis for its cost

estimate. First, it will have to reformulate 98 different

products within 18 different lines of paint. The products which

will need reformulating fall into ten categories: (1) fog

coatings, (2) nonflat coatings (exterior), (3) nonflat coatings

(interior), (4) primers and undercoaters, (5) quick dry enamels,

(6) quick dry primers, (7) rust preventative coatings, (8) stains

(clear and enamels), (9) traffic marking coatings, and (10)

waterproofing sealers and treatments (clear). Based on past

experience, they estimate it would take at least six months to

reformulate properly and thoroughly and test a product for

interior application only, and it would take longer for exterior

applications. Based on the compensation and related benefits for

the technical director and lab technicians, the average cost

comes to $85,000 per product line for a total reformulation cost

of $1,530,000. Because some lines have tint bases that will take

longer than 6 months, the actual cost will be even higher,

increasing the estimate to approximately $2,000,000.

Second, the commenter estimates $285,000 of business would

be lost due to banned products and lost customers. The commenter

lacks sufficient personnel to reformulate everything that needs

reformulating by April 1997 so they would be forced not to sell

certain products. Because they are in a market where their

customers expect one company to supply them with every product

they need, the inability to supply some products could cause some

customers to be lost.

Third, the commenter estimates $365,000 would be lost in

economic opportunities for product improvement and new product

development. Fourth, the commenter estimates $225,000 in costs

for storage space for new materials that may be required in new

formulations and for extra storage space for slow moving raw

material inventories that may need to be maintained. Finally,

the commenter estimates $200,000 in costs for collecting,
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reproducing and redistributing new product labels and associated

paperwork.

Response: The average of the cost estimates submitted in

the public comments (including the commenter's costs), which

include most of the “other” costs referenced in the comment, was

substantially less than the EPA’s original estimate of one-time

costs used in the proposal analysis (see Appendix A). Although

many of these “other” costs are now included in the final

analysis based on the public comments received, omission of these

cost components at proposal did not cause an understatement of

national costs. The EPA used an estimate of $250,000 for

reformulation, thereby overestimating costs for this producer

($85,000).

While the EPA maintains that its methodology for estimating

the number of products nationwide needing reformulation is

appropriate, it is not possible to verify that the 18 product

lines referenced in the comment were either directly (through the

survey) or indirectly (through the methodology for estimating

non-surveyed product costs) included in the national number.

The final rule is not expected to “ban” any products because

reformulation is anticipated to be technically feasible without

significant product quality changes. The financial losses are

quantified in the EIA as producer impact based on reductions in

profits (rather than lost sales). Using the average profit

margin presented by NPCA in the regulatory negotiation of

18.3 percent, the estimated losses based on the information in

this comment from product withdrawals would be approximately

$52,000 per year if the firm only considered product withdrawal

as an alternative to reformulation and did not utilize the

exemption provision, or fee option.

The EPA cannot validate the estimate that $365,000 would be

lost in economic opportunities for product improvement without

more information. However, the EIA analysis estimates the costs

of funds invested in reformulation, which directly reflects the

opportunity cost of capital, i.e., the economic value of foregone

opportunities.
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In regard to the $225,000 estimate for storage space for new

materials, it is not clear from the comment why storage of

materials used in new formulations would exceed storage needs for

materials in old formulations. Storage is needed for the new

materials, but presumably, storage will no longer be needed for

the materials that are being replaced.

Divided by 18 product lines, the $200,000 cost for

collecting, reproducing, and redistributing new product labels

and paperwork would come out to approximately $11,000 per

product. These being one-time costs, they need to be viewed in

the context of the $250,000 one-time costs that the EPA assumed

for reformulation at proposal. The commenter has indicated that

the one-time per product reformulation cost estimate for this

company is $85,000. Therefore, even if the $11,000 is added to

the $85,000, the total cost is well below the $250,000 per

products assumed in the EIA at proposal. Moreover, paperwork

costs are estimated separate from the EIA and are added to the

social cost estimate from the EIA to get the national cost

estimate. Therefore, paperwork costs are not excluded from the

national estimate.

Comment: One commenter (IV-D-180) maintained that only

58 percent of its 20.5 million dollar 1995 coating sales was for

products that complied with the proposed rule, which is too low a

percentage to sustain their coating business. 

Response: As the rule was structured at proposal,

manufacturers only had the options of reformulating products to

comply with the limits, or withdrawing a product from the market. 

Under this situation, the commenter may have determined that it

would cost the company less to lose the profits ($20.5 MM x

profit margin of 38 percent) from these products than to incur

the costs of reformulation. The final rule, however, provides

two additional options for this company: a tonnage exemption and

payment of an exceedance fee. This commenter suggested that a

450 gram per liter limit for floor coatings would enable the

company to remain competitive in the market. Given that the

company’s products are relatively close to the limit (i.e.,
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within 50 grams per liter), the exceedance fee approach would

likely be an attractive, viable option for this manufacturer once

the company has taken advantage of exempting some of the

noncompliant flooring product sales under the tonnage exemption.

Comment: One commenter (IV-D-152) noted that the annual

sales of its products affected by the proposed rule is under

$10 million but represents 20 percent of its total revenue base. 

Product line includes concrete curing and sealing compounds, form

releases, penetrating sealers and coatings. The commenter points

out that even with the adoption of its recommended 700 g/l limit

for concrete curing and sealing compounds, as discussed in

section 2.2.4.2, the company expects a significant shrinkage of

architectural coating sales due to the rule. The commenter noted

that a total elimination of solvent-based concrete curing and

sealing compounds would hurt its business growth because the loss

of the financial resources being generated from the sales of

those products.

The commenter presented a breakdown of the impact of the

proposed rule on its financial resources as follows: 

Reformulation of 12 products @ $864,000

$72,000/product:

Literature development/alterations: $60,000

Label changes: $10,000

Training of sales force/distributors $85,000

$1,019,000

Manufacturing/Capital Equipment $450,000

Total Costs $1,469,000

The commenter emphasized that the above direct cost estimates do

not include opportunity loss. All of the costs assume a fully

implemented new architectural coating product line on the date

the regulation takes effect. In practice, according to the

commenter, this could not happen and the timeframe between the

effective date of regulations and introduction of new compliant

products represents potential lost revenue and profits. This
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loss is potentially the largest of all costs according to the

commenter. Further, the above costs do not address the issue of

having the funds available for such a project or the

uncertainties of holding a market share in a rapidly changing

market. Based on these costs, the commenter estimated the

selling prices of materials would be expected to rise 15 to

18 percent to cover costs and the resulting higher incidence of

claims due to product failure.

Response: Using the commenter’s cost estimate of

$1,019,000, the average one-time cost per product is

approximately $85,000 per product, which is substantially below

the $250,000 cost estimate used in the EIA at proposal. It

should be noted that, in part, in response to this commenter’s

request, a category of “concrete curing and sealing” compounds

with a VOC content limit of 700 g/l was added to the final rule,

as discussed in section 2.2.4.2 of this document, and would be

expected to significantly reduce the cost for compliance for this

company. The EPA has also considered this compliance cost

information in the adjustment of one-time costs used in the final

analysis (see Appendix A for a description of the review of

compliance costs).

It is not clear what the manufacturing/capital equipment

costs of $450,000 refer to. If new machinery must be purchased

to reformulate (and do nothing else), information on the service

life of that machinery is necessary to place it on a comparable

annual basis with all other costs.

With regard to the statement about foregone profits for

products being the largest cost, these losses should be mitigated

by the availability of the 1-year compliance period, the tonnage

exemption, and the exceedance fee option of the final rule for an

interim period until the products can be developed.

2.3.2.8 Small Business Administration

Comment: One commenter (IV-D-16) expressed concern that the

Small Business Administration (SBA) appears to support the

exceedance fee, low volume exemption and the variance provision,

despite the commenter’s belief that the recordkeeping and
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reporting burden of these options is too high for small

businesses to take advantage of them. One commenter, the Small

Business Administration (SBA)(IV-D-57/IV-D-75), acknowledged that

the EPA consulted with SBA during the development of the proposed

rule, and the EPA incorporated several of SBA’s suggestions in

the proposal and supporting regulatory analysis. The commenter

also noted that SBA has been working with the trade associations

and some individual paint manufacturers on the rule. 

Response: The SBA was involved in the regulatory

development process to provide suggestions on alternatives to

minimize the impacts of the rule on small businesses. Based on

input from the Office of Management and Budget and the SBA prior

to proposal, the EPA requested comment on inclusion of an

exceedance fee provision and took comment on the need for

additional provisions to further accommodate specialized, niche

products. After consideration of the many comments on these

provisions, the EPA has included an exceedance fee provision and

a tonnage exemption in the final rule. As discussed in

section 2.4.1 of this BID, the exceedance fee provides long-term

flexibility, and a less costly compliance option, for both small

and large manufacturers selling very low-volume specialty

coatings where the cost of reformulation may be prohibitive

compared to the potential profit. The estimated cost for

reporting and recordkeeping of the fee provision at a company

with an average of eight reformulations is approximately

0.1 percent of sales revenue for a company with $5 million of

sales revenue. Therefore, the EPA believes that the

recordkeeping associated with this compliance option does not

present a significant burden, even for small businesses. The

final rule also includes a tonnage exemption that can be used in

combination with the exceedance fee. The final rule does not

include the proposed variance option.

2.3.2.9 Definition of “Small Business”

Comment: One commenter (IV-F-1m) suggested that a better

definition to use in examining the economic impacts on small

businesses is companies with less than $50 million in annual
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sales and fewer than 500 employees. Another commenter (IV-D-44)

advised the EPA to raise its unrealistically low categorization

of small business manufacturers to about $20-30 million dollars

in annual sales. Another commenter (IV-D-120) requested that the

EPA change its definition of a small business as having less than

$10 million in annual architectural coating sales and less than

$50 million in total annual sales of all products, to those

businesses with fewer than 500 employees or less than $10 million

in architectural coatings sales. 

Another commenter (IV-D-180) requested that the EPA

carefully consider the definition of a small business. The

commenter stated that its complete company would not meet the SBA

definition of a small business, but its floor coatings division

would. The commenter stated that larger companies are impacted

less by the proposed architectural coatings rule because they

have both research resources and a broad product offering that

includes many coating areas where lower performance can be

satisfied with existing low VOC technology. Another commenter

(IV-D-102) also expressed concern and stated than generally 

small companies have less than $100 million in sales on an annual

basis and have less than 500 employees. 

One commenter (IV-D-171) agreed with the use of this

alternative definition to identify small entities under the

Regulatory Flexibility Act. 

Response: The EPA believes that the definition of small

business, developed in conjunction with the SBA, for the proposed

rule is the most appropriate definition. Because the coating

manufacturing industry is not labor-intensive, a revenue value

cut-off rather than a number of employees cut-off is a better

measure to reflect the ability of a manufacturer to devote time

and research and development resources to meet regulatory

requirements. Based on input during the regulatory negotiation

process (II-E-62), the EPA has defined a small business as one

having less than $10 million in annual architectural coating

sales and less than $50 million in total annual sales from all

products. Using this definition, between 70 and 85 percent of
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the architectural coating industry would be classified as small. 

This definition does not change the requirements of the RFA; it

is used for analysis purposes only. If the definition were

changed to include more firms at sales levels greater than

10 million, the EPA is concerned that the impacts on this sector

of the industry may appear lower on average because the impacts

on a company with sales around $30 million may offset impacts on

a $5 million company. In such a case, it may have been less

appropriate to consider provisions such as the exceedance fee or

tonnage exemption designed to minimize the impacts on small

businesses. The EPA believes that the definition of small

business adopted for this rule allows it to estimate more

accurately the impacts of the rule.

2.3.2.10 Cost-Benefit Perspective

Comment: One commenter (IV-D-10) expressed concern that the

EPA is proceeding with this rulemaking at a pace too fast to

consider cost-benefit issues. Another commenter (IV-D-115)

stated that the benefit of a federal rule to set VOC limits on

all architectural coatings does not remotely outweigh the cost. 

One commenter (IV-D-212) asserted that the EPA had not

established technological and economic feasibility for the

proposed table of standards for architectural coatings. Another

commenter (IV-D-108) requested that the EPA share its

documentation that shows the benefits that will be gained from

this rule.

Response: Concerning the allegations that the EPA is

proceeding with this rulemaking too quickly to consider costbenefit issues properly and that the costs of the rule outweigh

the benefits, the EPA notes that development of the rule has

taken place over 8 years and involved numerous stakeholders,

including small and large manufacturers, suppliers, States, and

environmentalists. Based on guidance set forth by the Office of

Management and Budget for meeting the requirements of E.O. 12866

and the Unfunded Mandates Reform Act, a quantitative assessment

of benefits is not necessary for this rule. The EPA did prepare

an economic impact analysis of the proposed and final rule
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requirements. Potential cost, price, and output effects of the

rule were examined for the proposed requirements for VOC content

limits as well as the requirements in the final rule. The

economic analysis also evaluated the effect of the exceedance fee

and the tonnage exemption on the costs, price, and output

effects. Although the EPA did not quantify all the benefits of

the architectural coatings rule, the reduction in emissions of

VOC is estimated to be 103,000 Mg (113,500 tons) per year. When

compared to the estimated cost of the rule, $28 million (1991

dollars), the resulting cost-effectiveness value ($270/Mg or

$250/ton) is considerably lower than for typical VOC regulations

for other types of sources. Thus, even without a quantitative

benefit analysis, it appears that the cost-benefit ratio for this

rule would be as good as or better than that for other Federal

rules already established. 

As discussed in detail throughout section 2.2 of this BID,

the VOC content limits of the rule are based on performance of

existing technology and there are coatings in the market that

meet these limits. In fact, 64 percent of the products included

in the 1990 industry survey meet the VOC content limits in this

rule. Furthermore, some States have VOC content limits for

architectural coatings that are more stringent than this rule. 

Therefore, as noted earlier in this document, the data and

information available to the EPA indicate that the VOC content

limits in conjunction with the exceedance fee provision and

tonnage exemption, in the final rule reflect BAC for the

architectural coatings category. 

2.3.2.11 Executive Order 12866, Small Business Regulatory

Enforcement Fairness Act, Unfunded Mandates Reform Act

Comment: One commenter (IV-F-1m) maintained that a better

economic analysis and a full cost-benefit analysis is required

under Unfunded Mandates Reform Act (UMRA) and a much greater

degree of scrutiny under the Regulatory Flexibility Act as

amended by SBREFA (RFA) is required before this rule becomes

final. Another commenter (IV-D-214c) claimed that the EPA
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unlawfully withheld a cost-benefit statement required under UMRA

for rules imposing significant mandates on the private sector. 

Response: The EPA has complied with the requirements of

UMRA. Implementation of this regulation is estimated to result

in national annualized costs of approximately $28 million (1991

dollars). This value is equivalent to approximately $32 million

(1996 dollars.) This is before the $100 million threshold under

UMRA and E.O. 12866. Thus, based on guidance from the Office of

Management and Budget on meeting the requirements of E.O. 12866,

and UMRA, a quantitative analysis of benefits and a benefit-cost

comparison is not required for this regulation. In addition, the

EPA did conduct an evaluation of small business impacts of the

proposal in accordance with the Regulatory Flexibility Act and

requested comment at proposal on several provisions that would

alleviate some burden on small entities. For the final

regulation, the EPA has met the requirements of the RFA. 

Comment: One commenter (IV-F-1i) maintained that the small

container exemption, the compliance variance, the exceedance fee

option, and the low volume exemption which were included in the

proposed rule primarily to reduce small business impacts will not

primarily benefit small business. The commenter (IV-F-1i)

believed that the cost to reformulate products to meet these

regulations is not the real danger to small business. The

commenter believes that small business is doomed by the existence

of the regulatory environment which requires very specialized and

expensive staff. The commenter stated that when society decided

to regulate in the business area, they signaled the end of small

architectural coating business and also essentially eliminated

start-up operations.

Response: The EPA has made every effort to consider

specific small business concerns identified during the public

comment period. As a result of this consideration the compliance

period was extended, seven new coating categories have been added

to the final rule, a tonnage exemption was included, and the

exceedance fee option was included. The EPA has discussed the

impact of the rule on small businesses in section 2.3.2.5 of this
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BID and how the national rule compares to State rules in

section 2.2.4.

2.3.2.12 Adverse Socioeconomic and Related Impacts.

Comment: One commenter (IV-D-212 and IV-D-177) stated that

the EPA failed to examine the effect of the architectural

coatings rule on low income and minority workers. The commenter

(IV-D-212, IV-D-212p4) asserted that the architectural coatings

rule would adversely affect the sociological/psychological health

of individuals because jobs and human utility are directly tied

to self-worth. The commenter (IV-D-212, IV-D-212p4) claimed that

the proposed architectural coatings rule would result in the loss

of jobs which would adversely affect sociological and

psychological health.

One commenter (IV-D-212p) requested that the EPA, pursuant

to section 309 of the Act and E.O. 12898, analyze the

environmental effects of the rule on minority and low-income

communities, including human health, social, and economic

effects. According to the commenter, any additional regulations

affecting the coatings industry would have a substantial negative

effect on residents and businesses located within the State of

California. The commenter also contended that the rule, if

promulgated, would exacerbate the economic problems of other

similar urban areas. The commenter referred to a letter from the

EPA to Senator Kit Bond dated on or about June 15, 1995, which

acknowledged that the proposed regulation could result in an

adverse economic effect on small businesses. The commenter also

referred to several documents which it believed supported its

request for analysis of the environmental effects on minority and

low-income communities.

The commenter also stated that the rule failed to address

the concerns of the small business manufacturers, who were often

located in metropolitan areas and who would suffer the economic

effects. The commenter contended that the implementation of the

rule would result in the loss of jobs, particularly in mediumsized, regional, and local small businesses. The commenter

claimed that the manufacture and sales of paint products was
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concentrated in approximately 11 major metropolitan areas in the

United States and contended that the harshest effects of the rule

would occur in these metropolitan areas.

Another commenter (IV-D-49) stated that making the poor

poorer was harmful to the environment and our democracy. The

commenter claimed that there is a substantial link between the

hopelessness of today's youth and the nation's 30-year history

with VOC regulations, downsized jobs, and the loss of American

manufacturing.

Response: The EPA believes that a national architectural

coatings rule promulgated under section 183(e) of the Act will

not have the significant negative economic impacts claimed by the

commenter. The EPA’s position is further explained in

section 2.3.4 of the 183-BID. Many of the economic concerns

raised by the commenter are not direct effects of the

regulations. Because the EPA’s economic impact analysis for the

architectural coatings rule indicates that the direct economic

effects of a national architectural coatings rule will be small,

the EPA believes that indirect economic effects from this rule

will also be insignificant. The EPA notes that the economic

impact of the rule is limited, in part, because the rule provides

compliance mechanisms other than reformulation of products and

because the VOC content limits were established considering the

proper VOC content limit for specialty niche products. In other

words, the EPA designed the rule to limit the impacts on small

businesses, to the extent feasible and appropriate, consistent

with the goal of achieving VOC emission reductions.

The EPA also notes that the VOC content limits in the

architectural coatings rule are less stringent than the limits in

California state rules and are equivalent to or less stringent

than limits in rules established by other States. Thus, the EPA

notes that even if the commenters’ characterization of the

impacts of the California rule were accurate, they are not

relevant to this rule. The EPA has concluded that it is

extremely unlikely that the Federal rule would have the severe

consequences suggested by the commenters.
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Finally, the EPA believes that the particular analyses

requested by the commenters are not required by section 309 of

the Act or E.O. 12898. The reasoning is explained below for each

of these authorities.

Section 309. Section 309 of the Act requires the

Administrator to review and comment in writing on the

environmental impact of certain legislation and actions of other

Federal agencies. When activities are found to be unsatisfactory

from the point of view of public health or welfare, the EPA is

required to refer its finding to the Council on Environmental

Quality. The policy review provisions of section 309 do not

apply to regulations that are promulgated by the EPA. Thus,

section 309 does not require the EPA to perform any additional

economic or impact assessments or judgments that are not already

required to promulgate a rule under section 183(e).

Executive Order 12898. Executive Order 12898 established the

Administration's policy for identifying and addressing

disproportionately high and adverse human health or environmental

effects of federal agency programs, policies, and activities on

minority populations and low-income populations. While the

Executive Order was intended for internal management of the

executive branch and does not create legal rights or provide for

judicial review, federal agencies are to implement its provisions

"consistent with, and to the extent permitted by, existing law." 

59 F.R. at 7632-33. As noted in the Presidential memorandum that

accompanied the Executive Order, it is designed to focus the

attention of federal agencies on the human health and

environmental conditions in minority communities and low-income

communities to realize the goal of achieving environmental

justice.

The commenters suggested that their decision to eliminate

jobs of minority and low-income workers in response to regulation

creates an environmental justice concern that would necessarily

preclude the Agency from issuing the architectural coatings rule. 

EPA disagrees with that view. The Agency interprets section

183(e) of the Clean Air Act to be a mandate to obtain VOC
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emission reductions to achieve ozone reductions to protect the

health of all persons. Section 183(e) does require the Agency to

take into consideration the economic feasibility of the

regulations as part of the determination of what constitutes

"best available controls" for each category. Assuming, without

deciding the issue, that section 183(e) thus provides the Agency

with a mechanism to evaluate the possible economic impacts of the

rule upon low income and minority communities as one factor in

the determination, such impacts would be but one factor in the

analysis and must be viewed in the context of a statutory

provision designed to reduce exposure to ozone pollution for all

citizens.

 Using this assumption, EPA has considered the potential

impacts of this action on the human health and environmental

conditions in minority communities and low-income communities. 

The Agency believes that the architectural coatings rule will

provide public health and environmental protection to all

communities, regardless of their socioeconomic condition and

demographic makeup. Contrary to the assertions of the

commenters, the Agency believes that the architectural coatings

rule will not have the significant economic impacts claimed by

the commenters. For example, the Agency's Economic Impact

Analysis for the final rule estimates that out of a total

employment of 51,000 in the architectural coatings manufacturing

industry, there may be a loss of ten jobs. See EIA at 3-10, 11. 

It is not possible for the Agency to determine whether these jobs

will be held by members of low income or minority communities, or

whether those individuals will obtain new employment elsewhere. 

Nevertheless, EPA does not believe that these speculative limited

impacts will have a disproportionately high and adverse impact on

minority or low income communities and do not outweigh the

pollution reduction benefits of the rule as a whole. In fact,

reduction of VOC emissions from consumer and commercial products

such as those regulated by this rule should reduce public

exposure to ozone pollution widely, and especially in urban core

areas where there are concentrations of minority or low-income
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populations. EPA has thus concluded that the rule will help to

achieve the goals of environmental justice and will not have the

disproportionately high and adverse human health or environmental

effects addressed by the Executive Order. 

2.4 EXCEEDANCE FEE

2.4.1 Exceedance Fee Concept

Comment: Eleven commenters (IV-D-60, IV-D-114, IV-D-120,

IV-D-161, IV-D-169, IV-D-181, IV-D-189, IV-D-190, IV-D-206,

IV-F-1b, IV-F-1j), including two national coating manufacturers

trade associations, supported the exceedance fee approach for the

following reasons. One commenter (IV-D-190) maintained that the

exceedance fee and compliance variance in the proposed rule are

adequate protection for small domestic paint manufacturers that

cannot invent or license new environmental technologies. One

commenter (IV-D-181) supported the exceedance fee because it

provides manufacturers flexibility for some products that might

be difficult to reformulate. One commenter (IV-D-189) supported

the exceedance fee under the conditions that it would not be

excessive, it would not serve as a Federal tax on coatings, and

it would not dissuade consumers from purchasing architectural

coatings subject to the fee. The commenter concluded that the

optional nature and the amount of the proposed fees would be

consistent with these principles. 

Another commenter (IV-D-60) believed that an exceedance fee

provides added flexibility, allows for the continued sale of

high-price, high-performance coatings that are kinder to the

environment due to their longer durability, and offers

market-based incentives consistent with other EPA-regulated

industries. The commenter maintained that an exceedance fee

would be far more equitable than a low-volume exemption,

especially for smaller companies.

One commenter (IV-D-120) stated that the exceedance fee

would provide flexibility to both small and large businesses to

sell specialty coatings if reformulation is not technologically

or economically feasible. One commenter (IV-D-114) from a large

company indicated that the company supports exceedance fee
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provisions in situations where a variance is not available. 

Three commenters (IV-D-161, IV-F-1b, IV-F-1j) strongly

recommended an exceedance fee as a voluntary alternative to

compliance. For example, one commenter (IV-F-1j) discussed a

scenario where the cost of formulating one color in a line with

20 colors when all 20 colors are needed to sell the line would be

enormous compared to the return. One commenter (IV-D-161)

discussed a scenario where the cost of reformulating a particular

technology may be prohibitive compared to the potential profit

and cited the example of small volume specialty coatings. Also,

the commenter added that the exceedance fee would allow companies

to introduce new technologies that may need additional

development efforts to reduce the VOC content to the proposed

level. The commenter also emphasized the importance of providing

a flexible and cost-effective regulation while still achieving

the air quality goals. The commenter pointed out that the

industry cannot determine if the compliance costs are excessive

compared to other industries. According to the commenter, if the

cost of compliant coatings is more than the cost of non-compliant

coatings after payment of the fee, then compliance with the

limits becomes an excessive economic burden to that industry for

that product. This commenter supported the proposed variance and

the exceedance fee provisions to provide compliance relief for

all manufacturers rather than a small business compliance

extension. The commenter stated that small businesses had ample

time to prepare and pointed out that many States had already

adopted similar limits without special provisions for small

businesses or a variance provision.

One commenter (IV-D-169) advocated the exceedance fee as an

excellent way to offer flexibility when current technology does

not offer acceptable performance.

A national trade association (IV-D-206) maintained that the

EPA should allow products with higher VOC content to be sold if

manufacturers pay exceedance fees. They maintained that it may

be necessary for a few products that exceed the proposed VOC

content limits to remain on the market. They also asserted that
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the higher costs resulting from the exceedance fees will motivate

manufacturers to develop high performance products with low VOC

content and users to select complying products whenever possible.

Two commenters made specific recommendations: 

(1) One commenter (IV-D-161) recommended replacing the

variance option and low-volume exemption with the

exceedance fee to provide long-term control of

reformulation activities to the manufacturer. 

Additionally, the commenter stated that an exceedance

fee would reduce the growing number of categories and

exceptions to those categories without placing a burden

on the industry or the environment. 

(2) Another commenter (IV-D-209) requested that the EPA

combine a 5,000 gallon exemption with a reasonable

exceedance fee option (without excessive recordkeeping

and reporting requirements) to provide some relief for

small and large manufacturers who sell niche products

that cannot be economically or are not technologically

feasible to reformulate. These options may allow some

manufacturers to stay in business. 

The EPA also received comments critical of the exceedance

fee concept. Sixteen commenters (IV-D-02, IV-D-12, IV-D-22,

IV-D-32, IV-D-43, IV-D-126, IV-D-129, IV-D-148, IV-D-191,

IV-D-213, IV-F-1a, IV-F-1f, IV-F-1i, , IV-F-1k, IV-F-1l, IV-F-1m)

opposed the exceedance fee. One commenter (IV-F-1i) asserted

that if the public health is in danger, then no one should be

endangering public health for a fee. The commenter believe that

if the public health is not in danger, then the entire regulation

is unnecessary or the limits are more stringent than necessary.

Another commenter (IV-F-1k) urged the EPA to drop the

exceedance fee provision from the rule. The commenter asserted

that if the VOC content limits are not reasonable, then the EPA

should raise the limits. The commenter maintained that a fee

would disrupt the marketplace, shifting business from company to

company depending on their willingness to pay the fee. 

One commenter (IV-D-43) believed any exceedance fee would be

complicated and confusing. Two commenters (IV-D-12/IV-F-1l,

IV-F-1m) stated that an exceedance fee should not be an

alternative to compliance. One of the commenters (IV-F-1m)

maintained that standards can only be made less stringent by
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demonstrating technical and economic infeasibility and not by

paying a fee. One commenter (IV-D-02) stated that an economic

incentive in the form of fees would be a market disincentive and

that administration and compliance would be especially difficult

for small businesses. Two commenters (IV-D-32, IV-D-126)

regarded the exceedance fees as unnecessary. One commenter

(IV-D-32) reported that Oregon's regulation, for example, was

successfully implemented without such provisions. The commenter

asserted that exceedance fees would diminish overall emission

reductions and would not protect from an uneven geographic

effect. According to the commenter, the exceedance fees are

appropriate if more stringent levels are adopted in the future. 

If the provision is included, the commenter suggested that the

EPA require those manufacturers to show that their increased

emissions will not adversely affect attainment of the National

Ambient Air Quality Standards for Ozone in nonattainment or

maintenance areas. The other commenter (IV-D-126) suggested that

the fee was unnecessary because the EPA's VOC content limits are

not technologically difficult to achieve. 

One commenter (IV-D-129) calculated that the cost of

reformulated products would double or triple while exceedance

fees would add only 20 to 25 percent to the cost of the product. 

The commenter pointed out that this would force businesses to pay

the exceedance fee for non-compliant materials in order to stay

in business. The commenter also expressed concern that an

exceedance fee was difficult to police and would cause an unfair

business climate. The commenter mentioned that California's

architectural coating rules were difficult to enforce and alleged

that some businesses intentionally do not comply. This commenter

and another (IV-F-1f) questioned how the EPA would enforce this

provision on a national level. One commenter (IV-D-129)

considered the 8 years of negotiations plenty of time for

manufacturers to prepare for the final architectural coating

rule. The commenter maintained that the exceedance fee was a

disincentive for the companies that have used the last 8 years to

formulate compliant low VOC products. In short, the commenter
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indicated that the exceedance fee approach is fundamentally

flawed and defeats the purpose of the Clean Air Act and that his

small company does not support an exceedance fee option under any

circumstances. The commenter (IV-F-1a) only supported a limited

exceedance fee if there is a second phase of VOC content limits.

Two commenters (IV-D-213, IV-F-1f), one (IV-D-213)

representing 3,000 paint contractors, were opposed to an

exceedance fee mechanism because they believe it would drive the

market towards lower–cost and possibly less–dependable products

merely because of the price sensitivity of the market. According

to the commenter the largest amount of sales occur in the

do-it-yourself segment of the market, and the commenter

(IV-D-213) believed that these consumers will make purchases

largely on the basis of price considerations. The commenter

asserted that there is no substitute for VOC content limits that

reflect performance criteria and do not disturb currently used

products. 

One commenter (IV-D-226) maintained that the proposed

approach would be ineffective for providing an incentive to

develop low VOC content products where the products are

inherently high in unit cost and low in volume compared to other

coating categories. 

Two commenters (IV-D-129, IV-D-191) stated that the fee is

unacceptable because the fees are too low to motivate any

manufacturer to reduce VOC emissions. Instead, the commenter

expressed concern that the exceedance fee provision will

encourage industry to pay rather than reformulate.

Response: After careful evaluation of all of the comments

and discussions with the Small Business Administration (IV-H-2),

the EPA has decided to include the exceedance fee in the final

rule. Under this approach, manufacturers and importers have the

option of paying a fee, based on the extent to which VOC content

limits are exceeded, instead of achieving the VOC content limits

in the rule. The fee is calculated at a rate of $0.0028 per gram

($2,500 per ton, 1996 dollars) of VOC in excess of the applicable

VOC content limit, multiplied by the volume of coating produced. 
2-387

The EPA is including this option in the rule for several reasons. 

The exceedance fee option will provide transition time for those

manufacturers that need additional time to obtain lower VOC

technologies. The exceedance fee provides long-term flexibility,

and a less costly compliance option, for both small and large

manufacturers selling very low-volume specialty coatings where

the cost of reformulation may be prohibitive compared to the

potential profit. These important specialty products will

continue to be available to consumers. The exceedance fee option

is significantly less burdensome for manufacturers than the

proposed compliance variance provision, which has not been

retained in the final rule (see discussion in section 2.2.8 of

this document). Contrary to some comments received, the EPA

contends that the costs resulting from the exceedance fees will

generally motivate manufacturers to develop innovative

technology, such as high performance products with lower VOC

content. 

The EPA does not agree with some commenters that the

exceedance fee will disrupt the marketplace. The EPA expects

that the regulated entities will use the fee primarily for the

manufacture of low-volume specialty coatings, which are driven by

demand from consumers. It is not likely that the demand from

these markets would be significant enough to provide any

incentive for manufacturers to shift to these products. The

impacts to the market are lower with the fee than they would be

if reformulation was the only option available for producers,

because the fee reduces the number of potential product

withdrawals and reduces the net social cost. Raising the VOC

content limits in lieu of offering the fee could significantly

undermine the emissions reduction objectives of the proposed

rule. The fee provides some flexibility to producers of low

volume products, or products that are only slightly above the VOC

content limit of the standard who may find it prohibitive to

incur the largely fixed cost of reformulation. Because products

for which the fee is likely to be chosen would tend to represent

a small portion of the national VOC emissions from architectural
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coatings, the EPA anticipates that the fee option itself would

not significantly undermine emission reduction objectives. 

However, raising the VOC content limits in the rule would negate

reductions from all products that would no longer be subject to

the standards. The fee also provides continued incentive for

producers to reduce VOC content until they approach the VOC

content limits in table 1 of the rule.

Also, the EPA does not agree with the comment that the

inclusion of the exceedance fee will increase VOC emissions,

thereby endangering public health. The EPA believes that the fee

will be used primarily by those regulated entities manufacturing

low volume specialty coatings. Therefore, the EPA does not

expect that the continued use of these low volume coatings will

result in significant emission increases. In addition, the EPA

expects emissions to decline over time because new low-VOC

products will be developed to avoid the fee. The EIA for the

final rule evaluated the magnitude of lost emission reductions in

considering the fee provision and found that the fee would result

in a relatively minor adjustment in emission reductions, while

providing considerable flexibility in the marketplace, thus

reducing the number of products that withdraw from the market. 

The emission reductions that are not achieved as a result of the

fee are spread across 13 market segments throughout the country. 

Therefore, it is highly unlikely that the fee will result in the

concentration of additional VOC emissions in a small geographic

area that could harm the public health.

With regard to concerns about enforcement of the exceedance

fee, the recordkeeping and reporting requirements are designed to

ensure compliance with this option. Any violations of the

recordkeeping and reporting or any other requirements could

result in enforcement actions and the possibility of additional

penalties. 

Assuming $5 million of sales revenue as a midpoint estimate

for small companies in the $0-10 million range, fee recordkeeping

costs would be approximately 0.1 percent of sales revenue, which

is not a significant burden.
2-389

As indicated in the economic analysis, the EPA was unable to

obtain data on the effects of reformulation on product costs. 

Anecdotal evidence revealed some cases where costs would

presumably rise (e.g., higher solids content) and some cases

where costs would presumably fall (e.g., higher water content). 

As a result, it is not possible for the EPA to verify or refute

the commenter's claim that product costs would double or triple

for reformulated products, or, if it is true in the experience of

the commenter, whether that experience is representative of the

majority of other products. The EPA agrees, however, that the

costs of the exceedance fee may be less for source products and,

therefore, that some manufacturers will wish to utilize the

exceedance fee where the costs of reformulation may be less

economically attractive.

The EPA acknowledges that price increases on fee-paying

products may cause some substitution to non-fee-paying (lower

VOC) products. For some products, it may not be profitable to

reformulate or pay the fee, so firms may consider withdrawing the

product from the market. These phenomena are explicitly modeled

in the economic analysis. However, the premise of the fee is

that it internalizes the (public) environmental cost of VOC

emissions into the private cost of the good. Therefore, if some

consumers substitute away from the now higher priced fee-paying

product, it reflects the fact that they are not willing to pay

the "full" cost of consuming the higher VOC products. This is

the fundamental purpose of market-based incentives for

environmental protection. The EPA notes that section 183(e)

explicitly authorizes the EPA to utilize “economic incentives” as

part of the regulatory approach to obtaining VOC emission

reductions from consumer and commercial products.

As discussed in section 2.2.4 of this BID, the VOC content

limits in the rule are based on the EPA’s determination of best

available controls. As discussed in section 2.2.8 of this BID,

the EPA decided not to include the variance provision in the

final rule because the EPA determined that the variance provision
2-390

may not provide additional compliance flexibility, especially for

small businesses, as intended. 

2.4.2 Exceedance Fee Levels

Comment: Several commenters (IV-F-2) asked how the fee

level was developed. One commenter (IV-D-189) voiced concern

that the fee level was chosen as an initial rate and opposed any

unspecified increases in the future. Also, the commenter

expressed concern that States might develop a fee system that

would piggyback on the Federal system thereby increasing the fees

on manufacturers. In the opinion of the commenter, any such

State effort would have to be reviewed and approved by the EPA

Administrator. 

One commenter (IV-D-120) indicated that the current

exceedance fee was too high, but did not suggest an alternative

fee rate. Another commenter (IV-F-1b) requested that the fee be

set lower (possibly at $1,000 per ton) to offset the excess

recordkeeping requirements for these products. Other commenters

(IV-D-22, IV-D-79, IV-D-33, IV-D-34) also expressed the opinion

that the proposed level of the fee was too low.

Three commenters (IV-D-22, IV-D-79, IV-F-1a) thought that

the primary path to reduce VOC emissions from architectural

coatings is through reformulation, but paying the exceedance fee

is less expensive than reformulating. They also stated that a

limited exceedance fee could play a role only if set at a level

that is high enough to ensure that economics would drive

development of compliant coatings. Two commenters (IV-D-34,

IV-D-96) agreed that the fees were too low and that manufacturers

would not reformulate as a result of the availability of the

exceedance fee. 

Two commenters (IV-D-33, IV-F-1a) recommended an exceedance

fee that adds 10 to 20 percent to the retail cost of the

non-compliant coating to encourage manufacturers to reformulate. 

The commenter explained that the proposed incentive fee, a

60 cent per gallon cost increase, would easily be absorbed into

the price of home paints, which cost $10.00 to $20.00 per gallon. 

In short, the commenter (IV-D-33) supported an exceedance fee
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that is high enough to encourage development of compliant

coatings. 

One commenter (IV-D-93) stated that an exceedance fee was an

excellent alternative for products with high consumer acceptance

that cannot be reformulated immediately. The commenter suggested

a $.50 per gallon fee for products that are less than 100 g/l in

excess of the VOC content limit prescribed by the rule and a

$1.00 per gallon fee for the higher-polluting products. The

commenter supported a phase-out of the availability of the

exceedance fee mechanism as technology progresses.

One commenter (IV-D-181) believed the EPA should reevaluate

the exceedance fee structure. Rather than basing the exceedance

fee on the volume of VOC in the product, the commenter

recommended that the exceedance fee be based on some other

parameter, such as the retail price of the product. The

commenter requested this reevaluation because the $0.0028 per

gram (per liter) approach has a larger impact on lower cost

products, such as bituminous coatings and mastics compared to

higher cost products. For example, the exceedance fee for a

product with an exceedance of 50 g/l would be $0.53 per gallon,

which results in only a 3 percent cost increase for a $15 per

gallon product, but a greater than 25 percent increase for a

$2 per gallon product. Another commenter (IV-D-226) also

suggested that the fee be based on a percentage of the price,

especially for high cost, low volume categories.

One manufacturer (IV-F-2) stated that the exceedance fee

does not take into account the competitiveness in the

marketplace. A $1.00 per gallon fee is a significant price to

pay for coatings that only cost a few dollars. One industry

representative (IV-F-2) believed that the exceedance fees would

level the playing field between small and large companies. One

small business (IV-F-2) stated it will cost $2.50 more per can

for a compliant coating if exceedance fees are paid. Another

small business (IV-F-2) stated that the exceedance fee was too

high relative to the price of his products.
2-392

One manufacturer (IV-F-2) suggested that the exceedance fee

be phased in gradually (i.e., increase over time) and be

available only for a limited time. 

Another commenter (IV-D-169) suggested a phased-in fee of

$500 per ton the first year that escalates $500 per ton for each

year up to $2500 per ton in the fifth year. The commenter also

suggested that excess VOC be calculated on an actual VOC basis. 

If the “less water” method is used for waterborne coatings, the

excess VOC would often be 2-3 times larger than on a per gallon

of coating basis. Also, the commenter stated that the exceedance

fee is more appropriate than the small volume exemption. 

Response: The EPA considered several factors in choosing

the exceedance fee level, including the benefit per ton value

historically used in analyses under the Clean Air Act, the

historical range of acceptable cost-effectiveness values for VOC,

the magnitude of the loss in emission reductions, and the effect

on the market model (price and output adjustments, changes in

consumer and producer surplus, and changes in net social cost).

More specifically, the value chosen for analysis at proposal

is slightly higher than the benefit transfer value (i.e., the

benefit value per ton of VOC reduced) historically used in the

EPA analyses, and is also slightly higher than historical

cost-effectiveness values for VOC. This was done to provide

incentive for manufacturers to continue to strive to find low

cost methods of reducing the VOC in their products. Therefore,

manufacturers that find the fee the lowest cost option of

compliance with the regulation (in comparison to reformulation or

losing profits from product withdrawal) would pay the fee, but be

encouraged to find an even lower cost solution to reduce total

production costs in the long run. 

Another consideration by the EPA was the amount of emission

reductions lost at the selected fee level. This level also

proved to provide only minor adjustments in market price and

quantity in comparison to reformulation by itself, while

providing substantial flexibility to manufacturers of small

volume products or products that exceed the standards by a small
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amount. The EPA also evaluated a higher fee rate prior to

proposal and found that net social cost increased with a

relatively small change in lost emission reductions (as compared

to the lower fee rate). The EPA concluded that because the fee

was set high enough to make reformulation attractive for the

majority of producers, but low enough to allow a small sector of

products to remain on the market in lieu of withdrawal, and

because the lost emission reductions were minimal and the impact

on the markets was minor, the chosen level of $2500 per ton was

deemed acceptable.

Based on the EPA’s economic analysis, the fee does not

appear to be set too low. The economic model compares the cost

of paying the fee to the cost of reformulation for surveyed

products. While the analysis suggests that many regulated

entities will opt for the fee for certain products, these

products are uniformly small in volume; thus, their contribution

to total market output (and emissions reduction) is relatively

small. The EPA’s analysis suggests that it will rarely be 

advantageous for manufacturers of large volume products, which

generate a disproportionately large share of emissions, to opt

for the fee over reformulation. Furthermore, the existence of

the exceedance fee provides continued incentive for fee-paying

firms to reduce VOC contents on the margin, as this will reduce

the amount of fee they must pay.

Some commenters suggested that the exceedance fee should be

based on product price, rather than the quantity of VOC emitted

by the product. The premise of the commenters is that only a

large proportional price effect will induce large changes in

behavior. The objective of a pollution fee, however, is to

"charge" for the pollution generated. The only consistent way to

accomplish this is to have the fee payment depend on the amount

of pollution generated. It is not clear how a price-based fee

would be tied to the amount of VOC emitted. For instance, a

low-priced high VOC product could have a fee per unit that is

much lower than a high-priced lower VOC product. In this case,

the fee mechanism is not working to ensure enough incentive for
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the higher VOC product to reduce VOC content. In other words, a

ton of extra emissions from one product is being charged less

than a ton of extra emissions from the other. Alternatively,

having one ton of exceeded emissions face the same fee,

regardless of source is more efficient, and seemingly more fair.

The phasing of the tonnage exemption (see section 2.2.1.2 of

this document) in combination with the exceedance fee provision

is essentially doing what the commenters suggest for the

industry. In the time period from the compliance deadline

through the year 2000, manufacturers may exempt from regulation

23 megagrams (25 tons) of VOC, so total fee payments would be

lower than in the second year. The following year, 2001, has a

lower exemption level of 18 megagrams (20 tons) of VOC, so fee

payments would be slightly greater. In the next year and any

subsequent year of compliance, the fee rate would become level

because the exemption level remains the same at 9 megagrams

(10 tons) per year. The fee payments would also provide

incentive for manufacturers to find lower cost VOC technology to

meet the standard and eliminate or reduce their fee payments.

In the future, the Agency may consider revising the rule to

adjust the fee rate. Considerations in deciding to make an

adjustment may include, but are not limited to, inflation rates,

usage of the fee, and related emission impacts.

2.4.3 Use of Collected Exceedance Fees

Comment: One commenter (IV-F-2) asked where the money

collected from the exceedance fees would be deposited. One

commenter (IV-D-189) concurred that any decisions relating to

spending the exceedance fees must be made through the annual

appropriations by Congress and that the EPA should consult with

industry when developing a recommendation. The commenter

disagreed with the EPA's suggestion to award grants to private

firms and other entities to promote the development of lower VOC

coatings because the industry already supports substantial

research efforts. Alternatively, the commenter recommended

awarding grants to universities to help in the education of paint

chemists.
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One commenter (IV-D-162) recommended that revenues from

exceedance fees be used to study the performance capabilities of

advanced technology coating material. Another commenter

(IV-D-206) strongly recommended that the funds be used for study

or other research to evaluate the availability and performance of

products with reduced VOC content in order to evaluate the

effectiveness of the regulation in reducing ozone levels. 

However, the commenter recommended that exceedance fee funds not

be used for administration and enforcement purposes.

One commenter (IV-D-151) supported the allocation of a

portion of the fees for public outreach programs. 

One commenter (IV-D-120) stated that the EPA should split

exceedance fee revenues, using half to cover enforcement and

administration and reserve the other half to conduct a future

study to assure that the reductions are achieved in a reasonable

timeframe and in a cost-effective manner and without disastrous

economic effects to the industry.

Response: As discussed in the preamble to the proposed

rule, section 183(e) specifies that fees “... shall be deposited

in a special fund in the United States Treasury for licensing and

other services, which thereafter shall be available until

expended, subject to annual appropriation Acts, solely to carry

out the activities of the Administrator for which such fees,

charges or collections are established and made.” Through the

annual appropriations process, Congress will determine whether

and how to spend any fee revenues collected. The EPA will take

into consideration the commenter’s recommendations when

communicating with Congress regarding how the fees would be used. 

2.4.4 Exceedance Fee Recordkeeping and Reporting

Comment: One commenter (IV-F-1l) noted that small

businesses commonly sell the same product for use as

architectural coatings, miscellaneous metal parts coatings, or

wood products coatings, and so on. Because the difference in use

generally occurs after the point of sale, the commenter asked how

a manufacturer would predict which containers would be subject to

an exceedance fee.
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One commenter (IV-F-2) agreed that the suggested reporting

schedule for fee payments was reasonable. However, another

commenter (IV-D-169) requested that the reporting schedule be cut

to once or twice a year. One commenter (IV-D-120) stated that

the recordkeeping and reporting were too intensive, but did not

offer any alternatives.

Response: The decision of which containers of architectural

coatings would be subject to an exceedance fee is not made at the

point of sale. If the coating is intended for architectural use,

even if it is suitable for other uses as well, then it is subject

to the rule, and the manufacturer or importer is required to meet

the applicable VOC content limit or use alternative compliance

provisions, such as the exceedance fee option. Except for

specific exemptions listed in the rule, the most restrictive VOC

content limit applies for coatings that meet the definition of

more than one of the coating categories listed in table 1. Thus,

the manufacturer would pay the appropriate exceedance fee on all

containers of a coating product that is in a given category with

a limit the coating does not meet, even if some of the containers

may eventually be sold for another purpose for which the product

meets the applicable limit in the rule or for which the rule is

not even applicable. Manufacturers and importers are required to

keep records and submit reports detailing the following

information for all architectural coatings for which fees are

paid: VOC content, excess VOC content above the limit, volume of

coating manufactured or imported, annual fee for each coating,

and the total annual fee for all coatings. The EPA considered

the comments on frequency of reporting and determined that annual

reporting and fee payment is an appropriate interval for

compliance assurance and enforcement purposes. Therefore, the

rule requires that the exceedance fee be paid annually to the

Administrator and is due no later than March 1 each year for the

previous year in which the coating is manufactured or imported. 
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2.5 REGULATORY NEGOTIATION 

2.5.1 Section 183(e) Requirements and the Architectural Coatings

Regulatory Negotiations

Comment: Two commenters (IV-D-212; IV-D-214d) stated that

the EPA did not have the statutory authority to establish the

architectural coatings regulatory negotiations (hereafter called

“the reg-neg”) prior to the completion of the consumer and

commercial products study and report to Congress that was

mandated by Section 183(e) of the Act. One of the commenters

(IV-D-214d) cited an August 14, 1992 letter from EL RAP that

stated, “Section 183 expressly provides that the required

Consumer and Commercial Products Study must precede any

regulation.”

Two commenters (IV-D-212; IV-D-214d) stated that, by

proceeding with reg-neg prior to the completion of the study, EPA

assumed that paint products would be subject to regulation and

that they would be regulated in the first group. According to

the commenters, EPA made the determination that architectural

coatings were subject to regulation before an objective study had

been commenced or completed. The commenters stated that factors

key to this determination, such as reactivity, cost/benefit, and

uses and benefits of paint products, were unknown at the time the

reg-neg proceedings were commenced in early 1992. Furthermore,

one commenter (IV-D-212) expressed concern that the fact that EPA

began the reg-neg activities biased the eventual ranking of

architectural coatings in the first group.

One commenter (IV-D-212) stated that the reg-neg process was

contrary to the requirements of section 183(e) of the Act and the

intent of Congress. The following examples were provided:

1. The proposals were based on percent reduction targets

assigned by the EPA, rather than a determination of

BAC.

2. The proposals contained tables of standards that would

take effect in the future.

3. The proposals were national rules that included ozone

attainment areas.
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4. VOC calculations were based on mass tonnage, rather

than on a reactivity adjusted basis.

5. Performance was not properly addressed.

6. The five factors listed in the Act were not followed.

One commenter (IV-D-214d) cited a July 15, 1994 Petition For

Redress Of Grievances made by Smiland Paint Company and DunnEdwards Corporation that stated that during the reg-neg process

EPA openly focused on percentage of VOC reduction targets, which

are neither mandated nor authorized by Section 183(e). The

commenter stated that the VOC reduction targets were a resultoriented approach with no factual basis.

Response: The EPA disagrees with the commenter’s views (1)

that EPA did not have the statutory authority to establish the

architectural coatings regulatory negotiation and (2) that the

timing of this regulatory negotiation biased the study and Report

to Congress toward regulation of paints. The EPA also disagrees

with the commenters’ opinions that the regulatory negotiation was

contrary to the requirements of section 183(e) of the Act and the

intent of Congress.

At the outset, the EPA notes that section 183(e) does not

address the issue of whether or when the EPA may initiate a

regulatory negotiation for an anticipated rule. Section 183(e)

directs the EPA to conduct the study, to develop criteria, to

submit the report to Congress, and to list products for

regulation. The provision does not limit the EPA’s ability to

begin a regulatory negotiation process. The EPA’s use of the

regulatory negotiation process is permitted in accordance with

the provisions of the Negotiated Rulemaking Act, 5 U.S.C. §§581

et seq., which likewise did not preclude the EPA from initiating

a regulatory negotiation in this instance.

The EPA initiated the regulatory negotiation for

architectural coatings prior to completion of the section 183(e)

study and Report to Congress because it was widely recognized

that architectural coatings are a major source of VOC emissions

and it was highly likely that architectural coatings would be
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among the products listed for regulation under section 183(e). It

was known that architectural coatings were one of the largest

identifiable unregulated sources of VOC in many states’ emissions

inventories, and one of the largest sources of VOC emissions

among categories of consumer and commercial products. Because of

information such as this, Congress explicitly identified paints,

coatings, and solvents, as products for EPA to regulate as

consumer and commercial products under section 183(e) of the Act. 

Contrary to the assertions of the commenters, preliminary

information was available for architectural coatings on the

factors to be considered in the section 183(e) study. Past EPA

studies of paints and other coatings for CTGs and from State

regulatory efforts provided information on the availability of

alternatives, estimates of VOC emissions from the category,

general information on formulation of paints, and uses and

benefits of the products. At the time the regulatory negotiation

was initiated, EPA estimated that architectural and industrial

maintenance coatings represented 20 percent of the VOC emissions

from consumer and commercial products (57 FR 31473). Based on

this estimated contribution and other preliminary information,

EPA initiated regulatory development concurrently with

information gathering for the section 183(e) study and report to

Congress.

 The EPA does not believe that concurrent development of

the regulation and section 183(e) study biased the eventual

ranking of architectural coatings in the first group. The

information developed in the regulatory negotiation and other

information available on architectural coatings was considered in

the same manner as information on other categories of consumer

and commercial products. See the section 183(e) BID, section

2.1.1.6 for a description of the ranking process and the

consideration of statutory criteria; and section 2.1.1.7

concerning the ranking and consideration of criteria for

architectural coatings. As explained in those sections of the

section 183(e) BID, architectural coatings were judged using the

same ranking criteria and procedures as the other product
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categories. If during the regulatory negotiation, it had been

determined that emission estimates were inaccurate, or that

cost-effective controls were not available, or if any other new

information was received which affected the ranking, EPA would

have altered the priority given to the product category. Had the

study and Report to Congress indicated that architectural

coatings should not be regulated under section 183(e), the EPA

would not have proceeded to regulate them and the result of the

regulatory negotiation, if any, would have been moot. However,

to date, EPA has had no basis for making such a finding for

architectural coatings products. On the contrary, the regulatory

analysis for architectural coatings has confirmed that

architectural coatings are an emission source that warrants

regulation under section 183(e) of the Act.

The EPA believes that concurrent development of the

architectural coatings rule and the study and Report to Congress 

represented prudent planning and management of resources. This

approach is reasonable considering (1) the 3 to 4 years typically

required to study an industry and develop a proposed rule and (2)

the requirement in section 183(e) to issue the first group of

rules within 2 years of completion of the study and the Report to

Congress. Because EPA estimated that architectural and

industrial maintenance coatings were a major contributor to

emissions from consumer and commercial products, it was

considered highly likely that they would be regulated in the

first group of products to be regulated under section 183(e). 

The EPA believes that the commenters’ allegations that the

regulatory negotiation was contrary to the requirements of

section 183(e), that there was no factual basis for the VOC

reduction target, and that there was no focus on determining BAC

are unfounded and irrelevant to the final rule. The proposed

rule and the final rule are based on EPA’s evaluation of the

degree of emission reduction that is achievable for architectural

coatings. The EPA used information developed in the regulatory

negotiation (e.g., types of coatings, definitions of common terms

used in the industry) along with other information developed by
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EPA in the determination of BAC for different categories of

architectural coatings. It is important to note, however, that

the reg neg committee did not reach consensus and thus did not

produce a proposal that the EPA used as the basis for the

proposed rule. Thus, even, if there had been any error in

beginning the reg neg prior to completion of the study, that

error was moot with respect to the final architectural coatings

rule.

The specific points raised by commenter IV-D-212 are

addressed in section 2.2.4, section 2.6, section 2.1.2, and

section 2.1.1 of this BID and section 2.1.1 of the section 183(e)

BID.

2.5.2 Regulatory Negotiations Committee Was Not Properly

Constituted

Comment: Two commenters (AIM-IV-D-212, AIM-IV-D-214d,

AIM-IV-D-212jj) claimed that the reg-neg committee did not

adequately represent all of the interested and affected parties.

Both commenters (AIM-IV-D-212, AIM-IV-D-212jj, AIM-IV-D214d) asserted in three letters that the Reg-neg Committee was

dominated by representatives of large business, by governmental

officials, and by representatives of environmental organizations. 

One commenter (AIM-IV-D-212, AIM-IV-D-212jj) claimed that large

national and international companies had a far superior

representation on the committee even though small manufacturers,

compose 90 percent of the paint industry. The commenter asserted

that the constitution of the reg-neg committee was such that a

high percentage of reg-neg members (including the industry

caucus) strongly favored a national rule over other alternatives.

One commenter (AIM-IV-D-214d) stated that the reg-neg

committee was dominated by members who supported substitution

regulations and therefore was unbalanced on the basis of

viewpoint. The commenter cited a December 6, 1991 letter from

Smiland Paint Company that stated that one-half of the committee

members should have been persons who, through past words and

deeds, showed not only a mastery of the subject matter but also a

conviction that the rules at issue were both economically and
2-402

environmentally counterproductive and that the products in

question should be preserved. 

The commenter (AIM-IV-D-214d) claimed that EPA either

ignored requests to add or delete committee members in an effort

to obtain balance or acted in a way that insured that imbalance

was maintained.

One commenter (AIM-IV-D-212jj) implied that the EPA

intentionally skewed the membership of the reg-neg committee to

be unrepresentative of the industry. The commenter asserted that

EPA, in addition to its official Federal Register notice,

informed selected parties (implying those that EPA wanted on the

committee) in time for them to seek participation.

One commenter (AIM-IV-D-214d) stated that because it was

unbalanced, the reg-neg Committee had acted outside the bounds of

FACA. The commenter cited cases ostensibly supporting its

contentions that the committee was unbalanced and thus in

violation of FACA.

Response: On February 4, March 20, and April 15-16, 1992

the Agency held three public meetings to explore the feasibility

of conducting a regulatory negotiation for the development of a

national architectural coatings rule (57 FR 1443, 57 FR 8286). A

primary goal of the meetings was to identify the interests that

would be significantly affected by the rule and to identify

individuals who might represent those interests on an advisory

committee, if a regulatory negotiation approach was chosen by the

Agency. 

On July 16, 1992 (57 FR 31474), the EPA published notice of

its intent to form an advisory committee to negotiate a proposed

regulation for architectural coatings under the Federal Advisory

Committee Act (FACA) and the Negotiated Rulemaking Act of 1990

(NRA). In this notice, the Agency published a proposed list of

advisory committee members that was generated using the

information from the three public meetings, Agency expertise, and

information obtained by the Agency’s conveners. The proposed

list of advisory committee members represented all of the

identified interests that would be significantly affected by the
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rule. The list included seventeen industry representatives, one

consumer organization, five representatives of federal agencies,

five State and local representatives of air pollution control

agencies, three representatives of environmental groups, and one

labor organization. In the notice, the Agency requested comments

on whether the persons proposed for the advisory committee would

adequately represent all the interests that would be

significantly affected by an architectural coatings rule. The

notice also explained that

any person who may be significantly affected by the proposed

rule discussed in this notice, and who believes that their

interests will not be adequately represented by the persons

or entities listed in Section III of this notice, may apply

for membership on the advisory committee. Or as an

alternative, such person may nominate another person for

membership on the advisory committee.

The publication of the notice marked the beginning of a 30-day

comment period during which the public could submit comments and

applications for membership on the advisory committee.

A final scoping meeting was held on July 28 and 29, 1992 to

discuss further the feasibility of conducting a regulatory

negotiation for the architectural coatings rule and the make-up

of the advisory committee. Based on the interest of the

potentially affected parties and other considerations, the EPA

decided to proceed with the regulatory negotiation process for

the development of the AIM coatings rule. Therefore, on October

2, 1992, the Agency published its decision to establish a

negotiated rulemaking advisory committee for the architectural

coatings rule (57 FR 45597).

Based on the information provided at the final scoping

meeting, the comments and applications received on the proposed

advisory committee membership list, agency expertise, and

information obtained by the Agency’s convener, two more industry

representatives were added to the regulatory negotiation

committee, bringing the total to 34 committee members.
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The regulatory negotiation procedures allowed the addition

of new committee members during the regulatory negotiations

provided there was committee consensus. This provision was

exercised to add new committee members as was deemed necessary by

the committee. The EPA did not ignore requests to change the

committee composition (add members) to obtain or maintain

balance. The EPA initiated the appropriate procedures for

consideration of new members. The Agency believes that the

process above resulted in a balanced committee that adequately

represented all of the significantly affected interests.

With respect to the cases cited by the commenters in support

of claims that the reg-neg committee violated the provisions of

FACA, the EPA notes that the cases are clearly distinquishable on

their facts. Even without these distinctions, however, EPA

believes that the commenters cannot demonstrate a violation of

FACA regarding the “fair balance” of the committee. See

Fertilizer Institute v. EPA, 938 F.Supp. 52 (D.D.C. 1996)

(composition of committee is not justiciable and plaintiffs could

not establish standing). The EPA notes that the reg neg

committee did not reach consensus and thus that it did not

produce a proposal to form the basis for the EPA’s proposed rule. 

Thus, even if there had been any unbalance on the committee, it

did not affect the commenters. 

2.5.3 Regulatory Negotiations Procedure

Comment: One commenter (AIM-IV-D-214b/CP-IV-D-07b) stated

that the early convening, the lack of balance in the committee

membership, and the procedural improprieties were deliberately

designed by the EPA to support a predetermined outcome. 

According to this commenter, the predetermined outcome was early

promulgation of a VOC content-limiting regulation similar to but

with lower limits than existing rules in California. Another

commenter (AIM-IV-D-212j) also alleged that the outcome of the

reg-neg was predetermined by the EPA.

Concerning the allegation of a predetermined outcome, one

commenter (AIM-IV-D-214d) stated that EPA appeared to have

unilaterally abandoned its obligation to "negotiate" to reach a
2-405

"unanimous" agreement on a rule. The commenter cited an August

10, 1993 letter from the facilitator to committee members that

stated that there may have been "enough" support for a framework

for use "as the basis for EPA's draft rule language" and for

forwarding to EPA for its "use in developing a draft proposed

rule." The commenter expressed confusion regarding whether EPA

was still one among equals attempting to negotiate a rule to

which all committee members would unanimously agree or had

unilaterally scuttled reg-neg and started its own notice and

comment rulemaking.

One commenter (AIM-IV-D-212jj) alleged that there were

contacts between NPCA and EPA during the assessment of whether to

establish the reg-neg. The commenter (AIM-IV-D-212jj) speculated

that these contacts appeared to extend beyond what was

appropriate. The commenter (AIM-IV-D-212jj) implied that EPA

colluded with NPCA to heavily weight the Reg Neg committee with

members who favored a national rule. This commenter

(AIM-IV-D-212jj) alleged that the range of acceptable emission

limitations and corresponding categories were among the issues

that were taken up, and agreed to by EPA, before negotiations

began.

A commenter (AIM-IV-D-214d) contended the EPA facilitator

acted in ways that were not impartial. According to the

commenter: 

1. In the Spring of 1993 the facilitator asked three

caucuses, excluding the ALARM caucus, to designate

representatives to several important new workgroups and

denied workgroup membership to one ALARM member who

requested it. The commenter admitted that on May 12,

1993 EPA reversed its decision and allowed ALARM Caucus

members to participate in workgroups.

2. The facilitator elected not to hear the ALARM proposal

during the reg-neg session held at the end of July,

1993, even though the commenter believed it was the

most carefully prepared and defended of all the

proposals.

3. On July 29, 1993, promptly after circulation of the

ALARM proposal, the facilitator caused to be
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circulated, discussed, and partially supported at a

meeting of selected persons from three of the four

caucuses a competing conceptual framework for a rule

based on substitution.

4. The facilitator failed to honor the ALARM Caucus

members' request not to present the competing

conceptual framework until after the ALARM Caucus

proposal had been given full and fair consideration.

5. In an August 11, 1993, letter, the facilitator

questioned whether the ALARM Caucus' participation in

the regulatory negotiation continued to be in good

faith.

The commenter (AIM-IV-214d) stated that the requirement of

openness was violated in at least four main respects: 

1. On April 27, 1993, the facilitator ruled that the new

workgroups it had created would meet in private. The

commenter admitted that on May 11, 1993, EPA and

Keystone reversed the decision for secrecy.

2. After May 1993, open plenary sessions of all committee

members and observers became the exception rather than

the rule and substantive discussions were conducted on

a caucus-to-caucus basis.

3. On July 29, 1993, EPA and the facilitator, without

notice to the public or to the ALARM Caucus, held a

secret meeting late into the night miles away from the

site of the reg-neg session with selected

representatives of three of the four caucuses.

4. On March 2, 1994, members of the same small group which

had met privately in Washington in July 1993 again met

in Washington and again no member of the ALARM caucus

was invited to attend or was represented at the

meeting.

Response: Prior to the establishment of the regulatory

negotiation to negotiate a rule for architectural coatings, the

EPA convened a series of open workshops to discuss the scope of a

possible negotiation, review existing and planned data collecting

efforts, and determine the additional information that would be

required to support a rule. These meetings were a necessary part

of the EPA’s assessment of whether a regulatory negotiation or

other consensus building approach would be appropriate for this
2-407

rule. Contrary to the allegations by the commenters, the EPA did

not have a predetermined outcome for the negotiation or a preestablished position. This fact is demonstrated by the numerous

alternative proposals that were discussed in the committee

meetings. Specifically, during the negotiations, most of the

caucuses submitted proposed architectural coatings regulations

for review and discussion by the rest of the committee. In

addition, several regulatory frameworks, based on elements from

the individual caucus proposals and discussions, were prepared by

the EPA and the facilitator. The EPA also believes that the VOC

limits, as well as other aspects, of the final rule demonstrates

that the EPA did not have a predetermined position on the rule at

the time of the regulatory negotiation.

The regulatory negotiation for the architectural coatings

rule was conducted according to EPA’s procedures for advisory

committees and EPA disagrees with the commenters allegations that

the meetings were conducted improperly. The EPA’s advisory

committees operate under the Federal Advisory Committee Act

(FACA), as amended, (5 U.S.C. App. 2); the Negotiated Rulemaking

Act of 1990 (NRA), (5 U.S.C. Sec. 581 et seq.); the General

Services Administration Rule on Federal Advisory Committee

Management (GSA Rule), as amended, (41 C.F.R. Part 101-6) and

Executive Order 123838 “Termination and Limitation of Federal

Advisory Committees.” The EPA’s policies, procedures, and

responsibilities relating to the establishment, renewal,

termination, operation, management, and public accessibility of

EPA’s Federal advisory committees are contained in EPA’s

Committee Management Manual. The Architectural and Industrial

Maintenance Coatings Negotiated Rulemaking Advisory Committee,

was established and operated in full accordance with all of the

above provisions.

As required by FACA, all of the architectural coatings regneg meetings were open meetings that were announced in the

Federal Register and all interested persons had an opportunity to

file comments before or after meetings, or to make statements to

the extent that time permitted. 
2-408

As allowed by the NRA, the architectural coating advisory

committee developed an organizational protocol that outlined the

procedures and guidelines that were followed in the negotiations

(Docket Number A-92-18, Docket Item II-E-34). Among other

things, the organization protocol clearly outlined:

- the committee members responsibilities regarding

representation and attendance;

- the process for adding new committee members;

- the decision making process that was followed,

including, a definition of consensus and guidelines for

the formation of workgroups;

- the definition and terms of agreement on the product of

negotiations;

- the role of the facilitator;

- the process for conducting, announcing, and summarizing

meetings;

- the process for forming caucuses;

- the committee member’s legal rights; and 

- the schedule.

The procedures and guidelines in the organizational protocol were

followed throughout the regulatory negotiations by both the

committee and the facilitator. As outlined in the protocol, all

decisions or agreements made during the course of the

negotiations required unanimous consensus of all the committee

members. 

The protocol allowed for the formation of caucus meetings,

which were defined as “meeting breaks usually called for specific

parties to confer.” During the negotiation process it became

evident to the committee that certain groups of committee members

shared similar views and interests. Because these groups

frequently held caucus meetings during the negotiations, they

were called “caucuses.” The following caucuses were formed:

Users Caucus, State/Environmental Caucus, ALARM Caucus, and

Industry Caucus. During the negotiations, most of the caucuses

submitted proposed architectural coatings regulations for review

by the rest of the committee. In addition, several regulatory
2-409

frameworks, based on elements from the individual caucus

proposals and discussions, were prepared by the EPA and the

facilitator. Despite these efforts, the committee could not

reach consensus on an architectural coatings regulatory

framework. Therefore, on September 23, 1994, EPA announced the

conclusion of the architectural coatings regulatory negotiations

without consensus.

Given that the reg neg committee was unable to reach a

consensus, the EPA contends that even if there had been any error

in the procedures, such an error has no bearing on this final

rule. Because the reg neg committee reached no consensus, it

produced no proposal for consideration by the EPA in developing

the proposed rule.

The commenter’s points concerning the representation on the

regulatory negotiation committee are addressed in section 2.5.2

of this BID.

2.5.4 Miscellaneous

Comment: One commenter (IV-D-212) implied that EPA went

forward with the Architectural Coatings rule because of the

momentum created by the reg-neg and to justify the time and money

spent on it. The commenter estimated that EPA spent between $500

to $900 thousand dollars on the reg-neg.

Response: The EPA proceeded with development of a rule for

architectural coatings because the category of architectural

coatings is one of the largest sources of VOC emissions among the

categories of consumer and commercial products and it was

expected that significant emission reductions could be achieved

at much lower cost than from reductions of other stationary

sources of VOC emissions. Emissions of VOC from architectural

coatings in 1990 were approximately 560,000 tons per year. The

final rule is expected to reduce these emissions by approximately

113,500 tons per year, a 20 percent reduction. The estimated

total annualized cost of the rule is approximately $28 million

(1991 dollars). The average cost per ton of VOC emissions

reduced is $250 per ton for architectural coatings compared to

over $2,000 per ton for recent emission controls on new cars and
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$2,000 to $10,000 per ton for controls on other industrial

sources. 

Comment: One commenter (IV-D-214d) stated that EPA and its

facilitator declined a request to establish a workgroup on

environmental and economic impacts. The commenter stated that

the adverse environmental and economic impacts of substitution

was not taken into consideration during the negotiations.

Response: In development of the rule for architectural

coatings, EPA took into consideration potential adverse

environmental and economic impacts from the rule. See section

2.3 of this BID for responses to comments on this topic. Since

the regulatory negotiation closed without consensus on a draft

rule, the commenter’s specific concerns with procedures are not

relevant to the final rule.

Comment: One commenter (CP-IV-D-07a) stated that consensus

was not reached because several of the caucuses were willing or

eager to ban glossy enamels.

Response: The EPA believe that there were many factors that

caused the reg neg committee to fail to reach consensus. With

respect to the particular concern of the commenter, the EPA does

not believe that the architectural coatings rule will result in a

ban of any category of paints given the VOC content limits set in

the standard as well as the alternative compliance options of the

exceedance fee and tonnage exemption. Based on the 1990 survey

data, which contained information on over 40 million gallons of

exterior “nonflats” (includes oil-based exterior house paints),

the VOC content limit in the final rule is at a level that would

allow over 80 percent of these exterior nonflat products to

continue to be marketed. The rule establishes VOC content limits

at levels that would still allow glossy enamels to be produced. 

The EPA also notes that the positions of caucuses in the

regulatory negotiation are not relevant to the BAC determinations

in the architectural coatings rule since the rule is not based on

the regulatory negotiation.

Comment: After conclusion of the regulatory negotiations

without reaching consensus, one commenter (IV-D-212jj) presented
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a series of arguments against EPA proceeding with development of

a national rule for architectural coatings. In these arguments,

the commenter (IV-D-212jj) stated that there was not a broad base

of support for a federal rule within the architectural and

industrial maintenance coatings industry. As part of the

statement of this position, the commenter (IV-D-212jj) claimed

that the industry caucus group from the regulatory negotiation

was dominated by large national and international manufacturers. 

The commenter (AIM-IV-D-212jj) continued that the ALARM caucus

did not support the rule and that a straw-poll of small and

regional architectural coating manufacturers were unfavorable to

the EPA proposal. The commenter concluded that support for the

EPA proposal came mainly from the large national and

international manufacturers and that the proposal generally did

not have strong support among regional and local manufacturers. 

Response: The EPA notes that the commenter’s concern was

with the draft regulation that was developed in the regulatory

negotiation and that the positions of various caucuses on that

rule are not relevant to the proposed or final architectural

coating rule. Based on information available to EPA, many

members of the affected industry do strongly support the

architectural coating regulation. The EPA has worked closely

over many years with members of the industry (including small

manufacturers) in order to develop a regulation that is effective

yet not overly burdensome to manufacturers. In addition, the EPA

has worked closely with small manufacturers and with the Small

Business Administration to ensure that the rule does not impose

unnecessary impacts upon small businesses. The main trade

association for the architectural coating industry, the National

Paint and Coatings Association, supports our efforts to issue a

rule limiting VOC emissions from architectural coatings.

2.6 FUTURE STUDY

The EPA maintains that further reductions in VOC content

limits beyond those in table 1 of the architectural coating rule

may be technologically and economically feasible. However, much

controversy surrounds the proposal of more stringent VOC content
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limits in a future phase of regulation. To address the

controversy, the EPA announced in the preamble of the proposed

rule (61 FR 32743) that it would (1) investigate the cost and

performance characteristics of coatings with VOC contents lower

than the promulgated limits and assess the environmental and

economic impacts of requiring lower VOC contents; and (2)

continue to meet with other stakeholders regarding the potential

for a future phase of regulations for the architectural coating

rule.

At proposal, the EPA requested comment regarding a future

joint EPA and industry study particularly with respect to any

performance, cost, or reactivity considerations that should be

included in the study. The EPA also requested information on

coating categories where recent progress in low–VOC resin systems

has resulted in new low–VOC coatings being introduced into the

market since 1990. In addition, the EPA requested cost

information and comments on the ability of coatings with VOC

content levels lower than the proposed limits to meet the

performance needs within the various coating categories. The EPA

reiterates, that this second study would address whether more

stringent VOC content limits might be appropriate in the future. 

The study and Report to Congress performed by the EPA pursuant to

section 183(e) already demonstrated that consumer and commercial

products have the potential to contribute to ozone nonattainment

and that architectural coatings should be regulated and should be

regulated in the first group of product categories for

regulation.

Comment: A total of 29 commenters in 23 letters and 6

presentations (IV-D-28, IV-D-32, IV-D-33, IV-D-34, IV-D-82,

IV-D-96, IV-D-117, IV-D-118, IV-D-120, IV-D-126, IV-D-148,

IV-D-158, IV-D-162, IV-D-180, IV-D-181, IV-D-185, IV-D-188,

IV-D-189, IV-D-206, IV-D-211, IV-D-213/IV-F-1f, IV-D-214c,

IV-D-215, IV-D-217, IV-D-22/IV-F-1a, IV-F-1b, IV-F-1i, IV-F-1m,

IV-F-2) responded to the EPA's request for comments on a study

and future phase of VOC content limits. One commenter (IV-D-206)

supported a study and expressed interest in participating in it. 
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Four commenters (IV-D-126, IV-D-158, IV-F-1b, IV-F-1f) opposed a

study. Five commenters (IV-D-162, IV-D-185, IV-D-189, IV-D-211,

IV-D-213) neither supported nor opposed the study and future

phase of regulations but expressed an interest in being involved

in the study if the EPA decides to pursue it. Two commenters,

one supporting (IV-D-32) and one opposing (IV-D-189), discussed

the concept of continuous ongoing review and revision of

section 183(e) rules as best available control evolves. Two

commenters (IV-D-181, IV-F-1i) encouraged the EPA to set future

limits that were feasible and practical. One commenter

(IV-D-120) recommended that any future EPA/industry study include

all groups affected, both large and small businesses. 

Five commenters (IV-D-158, IV-D-181, IV-D-206, IV-F-1b,

IV-F-1f) supported the EPA's decision to include only a single

table of standards for the proposed standards, while one

commenter (IV-D-180) recommended that the EPA promulgate at least

two tables of VOC emission standards phased in on two separate

dates. Eleven additional commenters (IV-D-33, IV-D-34, IV-D-96,

IV-D-117, IV-D-118, IV-D-126, IV-D-148, IV-D-188, IV-D-191,

IV-D-215, IV-D-22/IV-F-1a) supported a future phase with more

stringent VOC emission reductions. Eight of these commenters

(IV-D-33, IV-D-34, IV-D-96, IV-D-117, IV-D-118, IV-D-126,

IV-D-215, IV-D-22/IV-F-1a) supported the future phase table of

VOC content limits recommended by STAPPA/ALAPCO that would

achieve a 40 percent emission reduction by 2002. The commenter

(IV-D-22/IV-F-1a) maintained that States would welcome a second

phase of standards even if the rule is delayed, provided that

State Implementation Plan (SIP) credits were able to carry over. 

Two commenters (IV-D-148, IV-D-22/IV-F-1a) suggested the phased

reduction should be set to achieve a 45 percent reduction in

overall VOC emissions within the industry as was agreed on during

the regulatory negotiation. One commenter (IV-D-188) requested

that the EPA work closely with California to help develop a

second phase to the proposed rule such that it will address areas

with the State's unique air quality challenges. 
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According to some commenters, there are advantages to having

a second table of emission standards or a future phase with more

stringent VOC emission reductions:

& Providing greater certainty to industry by not

submitting them to unknown future VOC content limits

imposed by States and providing them with adequate

warning about when the new emission standards will be

effective (IV-D-126, IV-D-180, IV-F-1a);

& Requiring that emission standards reflect BAC (IV-D-96,

IV-D-126, IV-F-1a); 

& Obtaining additional emission reductions (IV-D-34); and

& Allowing additional time for the industry to develop

coatings that are significantly less polluting and that

maintain the qualities demanded by customers (IV-D-96,

IV-D-126, IV-D-148, IV-D-180, IV-F-1a).

One commenter (IV-D-148) asserted that a phased reduction could

be accomplished in a relatively cost-effective manner compared to

VOC reductions in other areas. Another commenter (IV-D-126)

warned that the failure of the EPA to implement future reductions

in its rule effectively forces States to develop subsequent

coating regulations independently, increasing the hardship on

manufacturers. This commenter also asserted that a future phase

reduction that lowered VOC contents in 12 major coating

categories would give States additional reductions while also

addressing reformulation concerns of low-volume specialty coating

manufacturers. 

Eight commenters (IV-D-28, IV-D-158, IV-D-214c, IV-D-217,

IV-F-1b, IV-F-1f, IV-F-1m, IV-F-2) opposed a future phase of

regulations. Two commenters (IV-D-158, IV-D-214c) stated that

section 183(e) of the Act does not authorize the EPA to impose

future VOC content limits on the architectural coating industry. 

One commenter (IV-D-214c) expressed concern that neither the

preamble nor the proposed rule says anything substantive about

the possibility of the EPA imposing more stringent substitution

limits in a second round of regulation. Two commenters

(IV-D-158, IV-F-1b) asserted that any future phase reductions

would be technologically infeasible. 
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One commenter (IV-F-1f) asserted that further reductions

would force products to market that would not be appropriately

tested and could result in contractors and customers spending

large sums for coatings that do not perform. Thus, according to

the commenter, any environmental benefits that might be achieved

through accelerating reduction of VOC at the risk of performance

would be hollow gains and would ultimately result in more

emissions from coatings having to be reapplied. One commenter

(IV-F-1m) expressed concern that a future standard in as little

as 4 or 5 years will effectively negate the value of the earlier

reformulation and more than double the burden on businesses that

must reformulate to meet the first standard. One commenter

(IV-F-2) claimed that regulation will lead to accelerated

consolidation in the industry that will increase competitive

pressures on the remaining manufacturers. Therefore, the

commenter asserted that the contemplated second phase would be

the last straw for many companies.

One commenter (IV-D-217) addressed the financial and

technical burdens upon his company that would result from the

“year 2000" potential regulation of VOC emissions from

architectural coatings, using suggested values as published in

current trade journals. The commenter also presented the

assumptions made for analyzing the effects of the “year 2000"

potential VOC regulations. (The commenter is apparently

referring to VOC content limits that were discussed in the

regulatory negotiation as potential requirements for a second

phase that would have been effective in the year 2000.) For the

year 2000, his company will manufacture and offer for sale 255

individual formulas, both solventborne and waterborne. Of the

255 formulas, 52 of these formulas will not meet the potential

VOC content limits for the year 2000. Of the 52 affected

formulas, 35 of these formulas cannot be reformulated to meet the

VOC content limits and will have to be discontinued. The

remaining 17 affected formulas probably can be reformulated to

meet potential VOC content limits for the year 2000, but at great

cost to the company. At this time, the company cannot predict
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which of the 17 formulas will not be successfully reformulated. 

The commenter estimated a total cost of 6.4 million (rounded)

dollars to comply for the year 2000. The commenter requested

that the EPA consider the financial damage that will result from

potential future VOC regulations for small, regional paint

manufacturers such as the commenter’s company.

One commenter (IV-D-32) encouraged the EPA to conduct future

review and revision of the proposed rules as new best available

controls emerge. According to the commenter, such a review and

revision will serve to reduce demand for future local rules to

control VOC emissions. The commenter noted that section 183(e)

of the Act requires the EPA to use best available control to

limit consumer and commercial product VOC emissions. The

commenter asserted that a standard based on best available

control must inevitably evolve with the development of new

technologies or the introduction of newly exempted VOC. 

In contrast, another commenter (IV-D-189) contended that

because of the vast array of coating systems and the diverse and

distinct demands for various coatings, attempting continuously to

capture technological advances in regulatory mandates for this

complicated, diverse industry would be costly for the industry as

a whole, as well as being potentially anti-competitive and

difficult for the EPA to administer. The commenter noted that

Congress never stated any clear intention in section 183(e) of

the Act that the EPA is required or authorized to act to capture

or prod technology changes on a continuing basis. The commenter

noted that the EPA is explicitly required or authorized under

other provisions of the Act to revise guidance and other national

regulations and standards, e.g., automotive emission standards,

but claimed that there is no such explicit requirement or

authorization under section 183(e) of the Act.

One commenter (IV-D-181) supported the EPA’s decision to

make future rules contingent on a study of the feasibility and

practicability of such changes. Another commenter (IV-F-1i)

urged the EPA to avoid setting extremely stringent VOC content

limits requirements at some future date and then raising the
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levels to what most products achieve. The commenter noted that

when leading edge products are designed to meet a regulation,

cost and performance may be compromised. When less stringent

regulations are set, the market for those products disappears and

the manufacturers lose money.

One commenter (IV-D-206) supported the concept of a joint

future study to determine whether additional reductions in VOC

content levels are feasible. The commenter stated that a joint

study is a rational way of proceeding with consideration of more

stringent levels. Another commenter (IV-D-211), a principal

supplier of coatings to the installers and refinishers of sports

floors, agreed with the EPA that further VOC reductions "may be

technologically and economically feasible" in the sports floor

category.

According to one commenter (IV-D-28), the EPA and industry

lack the budgets to make the contemplated cost sharing study of

such a magnitude that it will be total, definitive, and/or

complete to justify additional regulation. The commenter

suggested that the EPA point out these limitations so as not to

raise expectations of the various stakeholders and requested that

all parties agree to a protocol with a tolerable cost level that

also ensures the likelihood of some reactivity results that will

have utility for the regulator and the regulated community. 

Another commenter (IV-F-1f) stated that feasibility must include

evaluation of a coating's ability to perform and urged the EPA to

consider performance issues as paramount in any future study. 

Four commenters (IV-D-126, IV-D-158, IV-F-1b, IV-F-1f)

opposed a future study. Two commenters (IV-D-158, IV-D-189)

asserted that section 183(e) of the Act may not authorize the EPA

to conduct a future study to determine the technological

feasibility to impose additional controls in the future. One

commenter (IV-D-126) stated that the focus of a national

regulation is to achieve actual VOC reductions that are known to

be technologically feasible. Based on the lower VOC content

limits currently established by many states that are being met by

manufacturers, the commenter believed that lower limits are
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clearly viable and should be pursued in a regulatory format

rather than after a future study. Therefore, the commenter

asserted that it is unreasonable to waste precious resources

conducting further analyses with no promise of further

reductions. Another commenter (IV-F-1b) contended that a future

study would be time consuming, costly and unlikely to find clear,

unambiguous evidence of appropriate VOC levels relative to

quality paint products. The commenter asserted that the EPA

presented the study in a particularly one-sided way, giving

little chance of favorable industry hearing on the subject. 

Another commenter (IV-F-1f) contended a study would be done

unfairly as an attempt to rationalize further reductions.

Seven commenters (IV-D-82, IV-D-162, IV-D-185, IV-D-189,

IV-D-206, IV-D-211, IV-D-213) expressed interest in participating

in any future study conducted to determine whether it is

technologically and economically feasible for the architectural

coating industry to develop products that are lower in VOC

content than the limits promulgated in the national rule. One

commenter (IV-D-189) will participate to ensure that the EPA has

sound information and that any decisions concerning technological

and economic feasibility of reformulating architectural coatings

are made at the national and not the State and local levels. 

Another commenter (IV-D-162) expressed interest in providing

evidence of coating performance, and will furnish studies of low

VOC industrial maintenance coatings as they become available. 

One commenter (IV-D-82) requested that the Solvents Council of

the Chemical Manufacturers Association be included along with

other stakeholders during the early stages of future rulemakings

for consumer and commercial products. 

One commenter (IV-F-2) requested that the EPA clarify the

process for the future phase study, and another commenter

(IV-D-189) requested that the EPA clarify the technological and

economic considerations that will determine its potential

conclusions in the study. Three commenters (IV-D-185, IV-D-189,

IV-D-213) provided input on how the EPA should conduct the study. 

Two of these commenters (IV-D-189, IV-D-213) stated that for any
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such study to have credibility and integrity, it must be

conducted under the proper conditions. The other commenter

(IV-D-213) stated that any future EPA study with members of the

industry to determine whether further reductions are

technologically and economically feasible must incorporate the

impact on contractors as well as manufacturers. The commenter

stated that if the EPA pursues further reductions, it must focus

on the impact of such reductions on the performance of the

products affected. The commenter agreed that the study should

examine cost and economic impact of lower VOC as well as

performance issues. The commenter also approved of looking at

reactivity considerations because reactivity factors could yield

a more sensitive and narrowly tailored regulation if the EPA can

find a way to work reactivity into a regulatory structure. Two

commenters (IV-D-185, IV-D-189) urged the EPA to approach the

subject of future regulation without preconceptions. They stated

that the study should not guarantee further regulation (i.e., the

possibility of no further regulation should be one possible

outcome). One commenter (IV-D-185) stated that such a study

should consider all significant business and scientific factors

including product performance, compliance costs, and the

incremental environmental benefit of further VOC restrictions. 

The commenter stated that the study should be fair and not

unfairly burden the paint and coating industry compared to other

regulated industries. 

Response: The final architectural coating rule contains

only one phase of VOC content requirements. The EPA has

determined that the rule’s requirements, considering the

compliance lead time and alternative compliance options

(exceedance fee and tonnage exemption), represent BAC for these

products at this time. For a more detailed discussion of BAC

determination, see section 2.2.4 of this document. 

In addition, the EPA has concluded that additional study of

this category may be warranted to determine the feasibility of

additional reductions in VOC content in the future. However,

contrary to some commenters’ assertions, the EPA would not
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necessarily impose additional VOC reduction requirements as a

result of any study. The future study could indicate that

further regulation of architectural coatings is unwarranted. The

EPA notes that contrary to the assertions of some commenters, the

EPA’s initial study and Report to Congress provided ample support

for the conclusion that consumer and commercial products have the

potential to contribute to ozone nonattainment and that

architectural coatings should be regulated. The purpose of the

contemplated second study would be to determine if additional VOC

reductions might be appropriate given recent technological

advances.

The EPA appreciates the willingness of manufacturers and

trade associations to participate in a joint study of future

reductions from architectural coatings. The effectiveness of any

such study is highly dependent on a spirit of openness and

cooperation between all affected parties. In order to determine

the potential for useful results from this second study, the EPA

will solicit input from industry representatives and other

interested parties on the timing, scope, and content of the

study. Decisions concerning the second study will be made on the

basis of this input.

Some commenters questioned the EPA's authority to engage in

any future regulatory initiatives involving architectural

coatings. These commenters did not identify any statutory

language in section 183(e) of the Act that supports this

position. Moreover, there is nothing in the statutory language

that prohibits the EPA from amending or revising the rule, should

that be appropriate in the future. The EPA believes that

section 183(e) explicitly authorizes the EPA to use "any system

or systems of regulation" appropriate to achieve the goals of the

statute, and the EPA's explicit directive is to require BAC. The

EPA has striven to promulgate appropriate regulations given the

current state of technology. Nevertheless, the EPA acknowledges

that in the future there may be advances that would justify the

EPA’s reexamination of the question of BAC and what level of VOC

content would be appropriate. As pointed out by some commenters,
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as technology evolves, it may be appropriate for the EPA to

reexamine whether the rule should be revised.

2.7 LEGAL ISSUES

2.7.1 Publication requirements of the Clean Air Act and the

Administrative Procedure Act

Comment: Two commenters (IV-D-212, IV-D-214c pp. 22-25)

expressed concern because the EPA published the architectural

coating preamble on June 25, 1996 (61 FR 32729) and the proposed

rule on September 3, 1996 (61 FR 46410). The commenters claimed

that because the EPA published the architectural coatings rule

preamble without the proposed rule text, the EPA failed to comply

with the law. One commenter (IV-D-214c) specifically stated that

the EPA failed to meet the publication requirements of Act

section 307(d)(3) and Administrative Procedure Act (APA)

section 553(b)(3). The commenter claimed that because the

preamble did not include the definition of each of the categories

of architectural coatings, a manufacturer could not know to what

limit a product would be subject. Therefore, the commenter

claimed that the EPA had not issued the proposed rule in

accordance with either Act section 307(d)(3) or APA

section 553(b)(3). 

Two commenters (IV-D-04, IV-D-11) also took exception to the

use of electronic bulletin boards as the method of providing

complete “regulatory text” to the public, as it tends to favor

larger business with an understanding of the electronic format

over smaller businesses. The commenters expressed concern that

use of the electronic format would result in fewer comments from

small businesses. 

Response: Contrary to the commenters’ claim, the EPA did

comply with the rulemaking requirements of both the Act

section 307(d)(3) and APA section 553(b)(3) when it published the

architectural coating rule’s preamble in the Federal Register on

June 25, 1996 (61 FR 32729) and the text of the proposed rule on

September 3, 1996 (61 FR 46410). Section 307(d)(3) of the Act

requires that:
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In the case of any rule to which this subsection

applies, notice of proposed rulemaking shall be published in

the Federal Register, as provided under section 553(b) of

Title 5, shall be accompanied by a statement of its basis

and purpose and shall specify the period available for

public comment (hereinafter referred to as the “comment

period”). The notice of proposed rulemaking shall also

state the docket number, the location or locations of the

docket, and the times it will be open to public inspection. 

The statement of basis and purpose shall include a summary

of--

(A) the factual data on which the proposed rule is

based;

(B) the methodology used in obtaining the data and in

analyzing the data; and

(C) the major legal interpretations and policy

considerations underlying the proposed rule. ...

Section 553(b) of the Administrative Procedure Act requires that:

(b) General notice of proposed rulemaking shall be

published in the Federal Register, unless persons subject

thereto are named and either personally served or otherwise

have actual notice thereof in accordance with law. The

notice shall include--

(1) a statement of the time, place, and nature of

public rulemaking proceedings;

(2) reference to the legal authority under which the

rule is proposed;

(3) either the terms or substance of the proposed rule

or a description of the subjects and issues involved. ...

Thus, as provided above, the EPA is under no obligation to

publish the text of a proposed rule in the Federal Register. The

EPA frequently does publish proposed regulatory text, however, as

a means of eliciting more specific comments from commenters. In

this instance, the EPA believes that most parties, including the

commenters, had participated in the regulatory negotiation

process and, accordingly, had sufficient notice of the coating

categories under consideration for regulation. In addition, the

proposed regulatory text for the architectural coatings rule was

available on the EPA’s electronic bulletin board, and was

available from the docket for the rulemaking, which was open to

the general public on the date that the proposed rulemaking was

published in the Federal Register. In a special effort to reach

small coating manufacturers in particular, the EPA also mailed
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the text of the proposed rule to over 600 small and medium-sized

businesses, announced the public hearing and small business

meeting, and requested comment on specific areas of the proposed

rule. Moreover, when the EPA received a request to publish the

proposed regulatory text, it did so on September 3, 1996 and

extended the comment period to insure that all interested parties

had time to review and comment upon the proposed regulatory text. 

Thus, the EPA believes that it has complied with the requirements

of section 307(d) of the Act and the APA, and that there was no

prejudice to the commenters.

With regard to the use of electronic bulletin boards, this

is only one method of providing the complete regulatory text to

the public. The regulatory text for a rulemaking can be obtained

from the particular rulemaking docket when the proposed (or

final) rule is published in the Federal Register. The EPA is

cognizant of the need to make materials available to interested

parties by different methods to insure that lack of access by one

method does not preclude access to information.

For these reasons, the EPA maintains that it is in

compliance with the procedural and publication requirements of

the Act section 307(d)(3) and Administrative Procedure Act

section 553(b)(3).

2.7.2 Compliance With the Regulatory Flexibility Act (RFA) and

the Small Business Regulatory Enforcement Fairness Act (SBREFA)

Comment: Two commenters (IV-D-62, IV-D-214c) maintained

that the EPA failed to prepare an initial regulatory flexibility

analysis or publish a “summary” as required under §603(a) of the

Regulatory Flexibility Act (RFA) for the AIM rule. One commenter

(IV-D-214c) stated that the Economic Impact Analysis (EIA) found

in the EPA’s docket included the EPA’s initial regulatory

flexibility analysis, but in at least the following areas it

failed to meet the mandates of §603: (1) there was no

consideration of 13 types of economic costs by small businesses

[603(a), 603(c)]; (2) the EPA failed to discuss any “differing

compliance ... timetables” for phase one; instead a prohibitively

short deadline is discussed [603(c)]; (3) omission of various
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other “alternatives” to “minimize” the impact of those limits;

(4) no statement of the “legal basis” of imposing limits to apply

to attainment areas, as required by §603(b)(2); (5) the failure

to state the “legal basis” for any potential second phase of

limits, as mandated by §603(b)(2); and (6) failure to include a

description of the “reasons why” imposing such limits is being

considered by the EPA, or the “objectives” thereof as required in

§603(b)(1) and (2). The commenter stated that instead of

completing the required summary, the proposal preamble contained

only four brief paragraphs, which discuss an incomplete set of

certain points. The commenter stated that in a two-page summary

of the EIA in the docket, the EPA conceded that “products made by

small producers, on average, have higher VOC content than the

industry average.” The commenter concluded that this suggests

that small businesses receive disproportionate impacts.

Response: The EPA prepared an initial regulatory

flexibility analysis for the proposed rule and summarized that

analysis in the notice of the proposed rule in accordance with

the RFA [5 U.S.C. 609(b)]. The EPA published the summary of the

initial regulatory flexibility analysis in the notice of the

proposed rule on June 25, 1996 (61 FR 32745). The initial

regulatory flexibility analysis addressed all the requirements of

the RFA. The analysis is contained in the draft EIA and

describes affected entities, analyzes market presence, discusses

the potential for disproportionate impacts based on the product

specialization of small businesses, estimates the costs

associated with regulatory compliance, and assesses regulatory

impacts, such as the cost to sales ratio for small businesses and

the estimated change in small business producer surplus. The EIA

was summarized in the proposal preamble, and was available for

review in the public docket. 

Comment: Four commenters (IV-D-214b/CP-IV-D-07b;

CP-IV-D-07a; IV-D-212; IV-D-214c) stated that the EPA looked only

at impacts on manufacturers with less than $10 million of annual

revenue from the sale of AIM coatings, whereas Small Business

Administration (SBA) rules regard a small paint manufacturer as
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one with 500 or fewer employees. As a result, the commenters

stated that the EPA erroneously excluded from its analysis many

small companies. One commenter (IV-D-212) stated that the EPA

allowed the NPCA to redefine small business as one with sales of

$10 million per year. The commenter stated that there was no

authority for any such redefinition of what constitutes as small

business and that the EPA performed this redefinition in order to

alter the analysis in the RFA. The commenter cited a letter it

wrote to Mr. Lader, SBA administrator, which referenced the Rauch

Guide and reiterated its contentions that the EPA marginalized

small business. The commenter contended that the EPA showed a

strong and continuing bias against small business which was

contrary to the express intent of Congress as well as the

President of the United States.

Response: The EPA did not include manufacturers having

annual sales above $10 million but fewer than 500 employees in

the initial regulatory flexibility analysis. The EPA established

an alternative definition of small businesses for the

architectural coating industry based on input from stakeholders

during the regulatory negotiation process. Since the

architectural coating industry is not labor-intensive, the EPA

determined that a dollar value cut-off rather than an employee

number cut-off would be a better measure to reflect the ability

of a given manufacturer to devote time as well as research and

development resources to meet regulation requirements. Using

this alternative definition (less than $10 million in annual

sales of architectural coatings and less than $50 million in

total annual sales), the EPA determined that between 70 and

85 percent of the industry should be classified as small. The EPA

believes that this definition of small companies is more

appropriate for the impact analysis under the RFA. If the

definition were changed to include more firms with sales greater

than $10 million but fewer employees, the impacts on this sector

of the industry would likely appear lower on average because the

impacts on a company with sales around $30 million may offset
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impacts on a $5 million company. Using such a definition, there

may have been less justification to consider special provisions

such as the exceedance fee or tonnage exemption to assist small

businesses.

The RFA allows agencies the flexibility to define small

entities using the criteria prescribed in the RFA or some other

criteria defined by the EPA. The SBA’s general size standard

definitions for Standard Industrial Classification (SIC) codes is

one way to define small business. The EPA can, however, modify

the definition where appropriate with the cooperation of the SBA,

the EPA did follow the proper procedures to choose the

appropriate definition of small business in this regulation. As

explained above, the EPA believes that the definition of small

business used in the RFA is more appropriate and puts greater

emphasis on potential impacts on small businesses than would the

SIC code definition alternative.

Comment: Four commenters (IV-D-05, IV-D-52, IV-D-55,

IV-D-62, IV-D-67, IV-D-70, IV-D-212, IV-D-214c, IV-F-1c)

expressed concern regarding the EPA's conclusion that the

proposed rule was not subject to SBREFA requirements because the

rule was published before SBREFA regulations became effective. 

Two commenters (IV-D-212, IV-D-52) stated that the fact that the

EPA published the rule 3 days before the effective date of SBREFA

showed that the EPA rushed publication to beat the deadline. One

commenter (IV-F-1c) stated that the fact that the EPA only

published the preamble in the June 26, 1996 notice, was further

evidence that the EPA rushed publication of the rule. The other

commenter (IV-D-55) contended that despite the period between the

proposal of the AIM rule and the effective date of SBREFA, the

AIM rule ought to be subject to the SBREFA requirements. The

same commenter (IV-D-214c) asserted that as a matter of law, the

EPA’s contention that it was not obligated to comply with §609(b)

because it published the preamble 3 days before §609(b) became

“effective,” was erroneous.

Response: The EPA disagrees with the assertions of the

commenters that the AIM rule was rushed to avoid the statutory
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requirements of SBREFA. The EPA published the summary of the

initial regulatory flexibility analysis in the notice of the

proposed rule on June 25, 1996 (61 FR 32745), while RFA §609(b)

took effect on June 28, 1996. However, the architectural coating

regulation was under development for many years prior to

publication. The proposed rule was the culmination of rulemaking

efforts that began in 1990. More than 2 years of formal

regulatory negotiation, involving representatives of both large

and small businesses, ended without consensus in September 1994. 

Stakeholders expected proposal of a national rule in early 1995. 

However, the schedule was delayed as the EPA responded to

concerns raised by both large and small businesses over VOC

requirements. The EPA dramatically changed the rule in response

to these concerns. The proposal included VOC limits that are

very similar to VOC content levels petitioned for by both large

and small businesses during 1995, and a second, more stringent

phase of VOC limits was removed from the proposal. The EPA

completed work on the proposed rule and submitted it for OMB

review on March 1, 1996. SBREFA was not enacted until

March 29, 1996. The proposed rule package underwent the maximum

90-day OMB review allowed by the Executive Order, and then was

signed by the Administrator on June 18, 1996. Thus, the close

proximity in time between the issuance of the proposal and the

effective date of SBREFA is not significant. The significant

fact is that the EPA developed the proposal over several years

preceding the existence of the statute. 

The EPA specifically disagrees with the commenters’

assertions that there was inadequate consultation with small

businesses prior to the proposal. The EPA has coordinated

extensively with small business representatives during rule

development. Small businesses were represented in the 2-year

regulatory negotiation process. During that process, two

meetings were held specifically to solicit additional small

business input. The EPA worked with the SBA, the trade

association representing many small businesses, and individual
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small businesses to insure that the EPA adequately took small

business concerns into account.

Following proposal, the SBA (IV-D-65) concluded that the new

SBREFA requirements did not apply to the proposed architectural

coatings rulemaking, because the rule was issued before SBREFA

became effective, and that in any case, the final rule and final

regulatory flexibility analysis would be subject to SBREFA and

judicial review. The SBA expressed satisfaction with the changes

the EPA made to the rule and the related regulatory analyses

prior to proposal IV-D-65.

After proposal, the EPA undertook an extensive effort to

solicit comment and information from small businesses in the

architectural coatings. As discussed in section 2.8 of this BID,

the EPA held a public hearing and two meetings with industry to

provided additional opportunity for discussion of concerns. The

EPA also mailed over 600 letters to small and medium-sized

businesses announcing the publication of the rule, announcing the

public hearing and small business meeting, and requesting comment

on specific aspects of the rule. The EPA notes that the final

rule is subject to the RFA as amended by SBREFA and, accordingly,

the EPA has complied with the statutory requirements for the

final rule.

Comment: Two commenters (IV-D-55, IV-D-70, IV-D-214c)

claimed that the EPA did not take actions mandated by § 609(b) of

the RFA as amended by SBREFA for the proposed rule. Such actions

included: notifying the SBA and providing information on the

potential impacts of the proposed rule on small businesses;

convening a review panel for such rule consisting of employees of

the EPA, SBA, and Office of Management and Budget; and reporting

on the representatives’ findings. Three commenters (IV-D-52,

IV-D-62, IV-D-214c) alleged that the EPA was required to

designate a small business advocacy chairperson to be responsible

for implementing new § 609(b). One commenter (IV-D-52) asked

whether the EPA complied with this mandate and requested the

chairperson's name, address, telephone number, and activities

with regard to implementing § 609(b). One commenter (IV-D-214c)
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specifically claimed that the EPA did not designate the small

business advocacy chairperson until June 11, 1996, which was

after the April 28, 1996, date mentioned in SBREFA. Also, the

commenter contended the chairperson failed to perform his

statutory responsibility to implement the review process mandated

by § 609(b) of the RFA for the proposed rule.

One commenter (IV-D-70) supported an in-depth review of the

rule by a panel of knowledgeable small business operators to

identify the extent of the economic impact on the small business

community of the architectural coatings industry.

Response: The EPA disagrees with the comments because they

presume that the proposed rule was subject to the RFA as amended

by SBREFA. As discussed above, the proposed architectural

coatings rule predated the effective date of SBREFA. Since the

initial regulatory flexibility analysis for the proposed rule was

completed and published in summary form prior to the effective

date of § 609(b) of the RFA, it cannot be subject to the

requirements of that section, which directs the EPA to convene a

panel for rules "prior to publication of an initial regulatory

flexibility analysis." Although a delay did occur in the

appointment of the EPA's small business advocacy chairperson, it

did not adversely affect the EPA's consideration of small

businesses concerns or the EPA’s coordination with small business

representatives. The RFA, as amended by SBREFA, does not require

a review panel for rules published prior to June 28, 1996. Given

that the architectural coating proposal was not expected to go

through the panel review process, the EPA’s small business

advocacy chairperson would have had no duties with respect to the

proposal prior to his appointment on June 11, 1996. 

Additionally, even though the architectural coatings regulation

was not subject to SBREFA's small-entity provision, extensive

coordination with small businesses and their representatives

occurred throughout the rule development process. There is a

strong record of coordination with small business representatives

beginning in 1992 during the regulatory negotiation. Although
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consensus was not reached, the negotiation sessions/public

meetings provided a forum for small businesses to make their

concerns known. Based on small business concerns, the EPA has

included a 1-year compliance period in the final rule. In

addition, the EPA has increased the compliance flexibility of the

rule through the addition of the tonnage exemption and the

exceedance fee option.

2.7.3 Unfunded Mandate Reform Act (UMRA)

Comment: One commenter (IV-D-214b/CP-IV-D-07b - page 12)

stated that the EPA failed to perform mandatory duties under

UMRA. The commenter claimed that the EPA failed to comply with

the following sections of UMRA: 

& Section 201 - which provides that each agency shall

assess the effects of Federal regulatory actions on the

private sector.

& Section 205(a)(2) - which provides that the EPA shall

identify and consider a reasonable number of regulatory

alternatives and, from those alternatives, select the

least costly, most cost-effective, or least burdensome

alternative that achieves the objectives of the rule

for the private sector. 

& Section 202(a) - which provides that the EPA must

prepare a budgetary impact statement to accompany any

proposed or final rule that includes a Federal mandate

that may result in estimated costs to State, local, or

tribal governments in the aggregate, or to the private

sector, of $100 million or more in any one year.

A second commenter (IV-D-52) likewise expressed concern that the

EPA had not complied with the cost-benefit assessment provisions

of section 202(a) of the UMRA of 1995. 

One commenter (IV-D-214b/CP-IV-D-07b) also stated that the

EPA incorrectly concluded in the preamble to the proposed rule

that the architectural coatings rule contained no Federal

mandates and was not, therefore, subject to the requirements of

section 202 and 205 of the UMRA. The commenter stated that

§ 59.402(a) of the proposed rule mandated that manufacturers

shall limit the VOC content of each coating manufactured to
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certain VOC levels, which was a Federal mandate for the private

sector.

The commenter (IV-D-214b/CP-IV-D-07b, CP-IV-D-07a) asserted

that conducting an UMRA analysis would force the EPA to consider

more adequately the economic and environmental impacts of the

rule. The commenter (IV-D-214b/CP-IV-D-07b, CP-IV-D-07a) stated

that the written statement required by section 202(a) of UMRA

should include an assessment of the effect of the proposed rule

on the natural environment. The commenter claimed that the EPA

has totally ignored the possibility that the architectural

coatings rule may actually increase air pollution rather than

reduce it.

Response: The EPA believes that the commenters base their

comments regarding the EPA’s compliance with UMRA upon mistaken

premises. As noted by the commenters, UMRA section 202 generally

instructs the EPA to prepare a cost benefit analysis for proposed

or final actions that will impose a Federal mandate upon State,

local, or tribal governments, or upon the private sector, in

excess of $100 million in any one year. As explained in

section 2.3.2 of this document, the EPA has performed appropriate

analyses which indicate that the economic impact of this rule

will be approximately $28 million per year. This level is

obviously far below that which would necessitate the specific

type of analysis required under UMRA section 202. The EPA

recognizes that the commenters dispute the amount of the total

impacts of the rule, and would expand those impacts to assure

that they exceeded $100 million per year. As discussed in

section 2.3 of this document, the EPA believes that it has

conducted the proper analysis and has included the appropriate

impacts in calculating the total impacts of the rule.

Given the foregoing analysis, it is also apparent that UMRA

section 205 does not apply to the architectural coatings rule. 

As the commenters noted, UMRA section 205 generally requires the

EPA to identify and consider regulatory alternatives and to adopt

the least costly, most cost-effective or least burdensome

alternative that achieves the objectives of the rule, with
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certain exceptions. The specific analysis of UMRA section 205 is

not required unless the economic impacts of the rule exceed the

$100 million threshold. A criterion that the architectural

coatings rule does not meet. However, the architectural coatings

rule was developed in the spirit of UMRA, being proposed after

years of development during which many regulatory alternatives

were considered. Some of these were explored during the failed

regulatory negotiation, and others closer to the proposal date. 

Even though this rule does not meet the section 205 criterion the

EPA developed the rule by evaluating many alternatives and

choosing cost-effectiveness alternatives that minimize economic

impacts on regulated entities.

In short, the EPA disagrees with the commenters’ claim that

the EPA has ignored the requirements of UMRA. To the contrary,

the EPA has assessed the potential impacts of the rule and has

concluded that the rule will not impose a Federal mandate with

impacts in excess of $100 million in any one year. As such, the

EPA did not prepare the specific types of analyses demanded by

the commenters. The EPA notes, however, that it has nevertheless

attempted to promulgate a final rule that minimizes the potential

impacts upon the private sector as explained throughout this

document. 

2.7.4 Environmental Justice

Comment: One commenter (IV-D-177) expressed concern that

the EPA has not complied with E.O. 12898 in connection with the

architectural coatings rule. The commenter implied that the rule

would force manufacturers to terminate the employment of

employees who are members of low income or minority communities,

thereby contravening the principles of environmental justice.

Response: Executive Order 12898 established the

Administration's policy for identifying and addressing

disproportionately high and adverse human health or environmental

effects of federal agency programs, policies, and activities on

minority populations and low-income populations. While the

Executive Order was intended for internal management of the

executive branch and does not create legal rights or provide for
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judicial review, federal agencies are to implement its provisions

"consistent with, and to the extent permitted by, existing law." 

59 F.R. at 7632-33. As noted in the Presidential memorandum that

accompanied the Executive Order, it is designed to focus the

attention of federal agencies on the human health and

environmental conditions in minority communities and low-income

communities to realize the goal of achieving environmental

justice.

The commenters suggested that their decision to eliminate

jobs of minority and low-income workers in response to regulation

creates an environmental justice concern that would necessarily

preclude the Agency from issuing the architectural coatings rule. 

EPA disagrees with that view. The Agency interprets section

183(e) of the Clean Air Act to be a mandate to obtain VOC

emission reductions to achieve ozone reductions to protect the

health of all persons. Section 183(e) does require the Agency to

take into consideration the economic feasibility of the

regulations as part of the determination of what constitutes

"best available controls" for each category. Assuming, without

deciding the issue, that section 183(e) thus provides the Agency

with a mechanism to evaluate the possible economic impacts of the

rule upon low income and minority communities as one factor in

the determination, such impacts would be but one factor in the

analysis and must be viewed in the context of a statutory

provision designed to reduce exposure to ozone pollution for all

citizens.

 Using this assumption, EPA has considered the potential

impacts of this action on the human health and environmental

conditions in minority communities and low-income communities. 

The Agency believes that the architectural coatings rule will

provide public health and environmental protection to all

communities, regardless of their socioeconomic condition and

demographic makeup. Contrary to the assertions of the

commenters, the Agency believes that the architectural coatings

rule will not have the significant economic impacts claimed by

the commenters. For example, the Agency's Economic Impact
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Analysis for the final rule estimates that out of a total

employment of 51,000 in the architectural coatings manufacturing

industry, there may be a loss of ten jobs. See EIA at 3-10, 11. 

It is not possible for the Agency to determine whether these jobs

will be held by members of low income or minority communities, or

whether those individuals will obtain new employment elsewhere. 

Nevertheless, EPA does not believe that these speculative limited

impacts will have a disproportionately high and adverse impact on

minority or low income communities and do not outweigh the

pollution reduction benefits of the rule as a whole. In fact,

reduction of VOC emissions from consumer and commercial products

such as those regulated by this rule should reduce public

exposure to ozone pollution widely, and especially in urban core

areas where there are concentrations of minority or low-income

populations. EPA has thus concluded that the rule will help to

achieve the goals of environmental justice and will not have the

disproportionately high and adverse human health or environmental

effects addressed by the Executive Order. 

2.7.5 Executive Order 12866

Comment: Two commenters (IV-D-55, IV-D-214b) argued that

the EPA did not properly apply E. O. 12866 to the proposed

architectural coatings rule. According to the commenters, the

EPA failed to provide the required economic analysis to OMB. One

of the commenters (IV-D-214b) argued that the EPA had ignored the

fact that the rule would constitute a significant regulatory

action under section 3(f)(1) of the Order (i.e., a rule with

impacts over $100 million per year) which necessitates

preparation of additional analyses under section 6(a)(3)(C) of

the Order. The other commenter (IV-D-55) also stated that a full

cost-benefit assessment of each alternative method of regulation

(exemption, reformulation, or substitution) was required under

the Executive Order [section 6(a)(3)(C)] for each of the 50

categories of coatings in the proposed rule.

Response: The EPA does not agree with the commenters that

this rule is a significant regulatory action under

section 3(f)(1) of the Order. At the time of proposal, the EPA
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performed an economic impact analysis of the proposed rule and

placed this analysis in the docket (II-E-5). This analysis

indicated that the impacts of the rule were approximately

$25 million, with an upper bound estimate of $40 million per

year, and that the impacts would probably be less than either

figure. This amount is far below the $100 million per year level

of impacts that triggers the obligation to do further analysis

under the Order. The EPA did not ignore the requirements of

E.O. 12866.

Although the impacts of the rule fell far beneath the

$100 million threshold explicitly noted in section 3(f)(1) of the

Order, the EPA did submit the rule to OMB for consideration

because the rule potentially posed “novel legal or policy issues

arising out of legal mandates.” The EPA determined that this

rule is a “significant regulatory action” based on the novel use

of economic incentives (exceedance fee provisions)(61 FR 32744). 

The proposed rule was submitted to OMB for review. Contrary to

the commenters’ assertions, submission of the rule to OMB on the

basis of novel legal or policy issues does not trigger the

obligation under section 6 of the Order to conduct additional

economic analysis. Such additional analysis is only necessary

when and if a regulation has impacts in excess of $100 million

per year and meets the other requirements of section 3(f)(1). 

The Guidance from OMB regarding implementation of Executive Order

12866 indicates that such additional economic analysis is only

applicable in the event a rule is economically significant (i.e.,

has impacts of $100 million or more per year). The EPA

nonetheless provided additional analysis in both the preamble and

the BID for the proposed rule that addressed the benefits and

impacts of the rule in qualitative terms.

One commenter (IV-D-214b) implied that the EPA did not take

into account all of the costs of the rule in calculating the

aggregated economic impact for the purposes of the Order. The

EPA notes that it conducted the economic analysis appropriately,

taking into account all relevant factors and issues. The EPA

considered net social cost, distribution of costs to consumers
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and producers, employment impacts, and small entity effects. (See

Economic Impact Analysis). The EPA believes that this analysis

reflects an accurate and appropriate assessment of the impacts of

the rule. Furthermore, the EPA has concluded that to expand the

analysis in the fashion suggested by the commenter would

misrepresent the true impacts of the rule rather than insuring

the accuracy of the analysis.

Finally, the EPA notes that the Economic Impact Analysis for

the final rule indicates that the impacts of the final rule will

be approximately the same as the impacts for the proposed rule

(IV-A-1). The estimated cost for the final rule reflects several

adjustments to the cost estimates used at proposal. These

adjustments include a decrease in the reformulation cost based on

information submitted in public comments and decreases in

compliance costs due to the EPA’s decision to provide compliance

alternatives in the form of exceedance fees and the tonnage

exemption. These compliance alternatives provide long-term

flexibility and less costly compliance options for low volume

specialty coatings where the cost of reformulation may be

prohibitive compared to potential profits. Because of these

adjustments to the rule to further mitigate potential impacts,

the EPA has confirmed that the rule will not have impacts of over

$100 million per year and therefore that the types of analyses

requested by the commenters are neither required nor necessary. 

2.7.6 The U.S. Constitution

2.7.6.1 Interstate Commerce Clause

Comment: One commenter (AIM-IV-D-214c) asserted that the

EPA’s regulation of architectural coatings under section 183(e)

of the Act violates the Commerce Clause of the U.S. Constitution. 

The commenter stated that the regulation of products by the EPA

is impermissible based upon U.S. v. Lopez, 115 S. Ct. 1624

(1995)(Congress lacked power under the Commerce Clause to

criminalize possession of a firearm within 1000 feet of a

school).

Response: The EPA disagrees with these comments. The

Constitution gives Congress the power “[t]o regulate commerce ...
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among the several States.” U.S. Const., Art. I, section 8, cl.3. 

Under the Commerce Clause, Congress may “regulate those

activities having a substantial relationship to interstate

commerce, i.e., those activities that substantially affect

interstate commerce.” Lopez, 115 S. Ct. at 1629-30 (citations

omitted). The courts have consistently held that Congress acted

within its powers under the Commerce Clause when it enacts

statutes to control pollution such as the Clean Air Act. See,

e.g., Hodel v. Virginia Surface Mining & Reclamation Ass’n., 452

U.S. 264, 289 (1981). Regulation of air pollution and of

emission sources that contribute to air pollution is a legitimate

exercise of the EPA’s authority under the Act and is thus within

the scope of Congress’ power under the Commerce Clause.

The Supreme Court’s opinion in Lopez confirms this analysis. 

The Court noted that “[t]he possession of a gun in a local school

zone is in no sense an economic activity that might, through

repetition elsewhere, substantially affect any sort of interstate

commerce.” Lopez, 115 S. Ct. at 1634; see also, Id. at 1640

(Kennedy, J., concurring)(“here neither the purposes nor the

design of the statute have an evident commercial nexus”). The

Lopez decision thus indicates that one test of the validity of a

statute under the Commerce Clause is whether the statute does

govern economic activity which through many repetitions can have

a cumulative effect upon interstate commerce.

Unlike the statute at issue in Lopez, section 183(e) of the

Act and the architectural coatings rule affect conduct and

products that are unquestionably commercial. The limitation of

VOC content and related requirements directly affect entities

(manufacturers and importers), conduct (marketing and selling),

and a subject matter (products for sale both locally and

nationwide) that are involved in interstate commerce. The

Supreme Court has consistently held that Congress may regulate

products or services that substantially affect interstate

commerce. See Hodel v. Virginia Surface Mining & Reclamation

Assn., Inc., 452 U.S. 264, 276-80 (1981)(interstate coal mining);

Perez v. U.S., 402 U.S. 146, 155-56 (1971)(intrastate
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extortionate credit practices); Katzenbach v. McClung, 379 U.S.

294, 299-301 (1964)(restaurants utilizing substantial interstate

supplies); Heart of Atlanta Motel, Inc. v. U.S., 379 U.S. 241,

252-53 (1964)(hotels catering to interstate guests); Wickard v.

Filburn, 317 U.S. 111 (1942)(intrastate production and

consumption of homegrown wheat). In particular, the Supreme

Court has recognized that Congress has authority under the

Commerce Clause to regulate those intrastate activities “that

arise out of or are connected with a commercial transaction,

which viewed in the aggregate, substantially affects interstate

commerce.” Lopez, 115 S. Ct. at 1631.

The products covered by the architectural coatings rule

substantially affect interstate commerce. Data from 1990

indicate that architectural, industrial maintenance, and traffic

marking coatings constituted 52 percent of the volume and

46 percent of the value of all paint and related products shipped

in the United States in that year (III-B-1 pg. 3-8). These

percentages translated into 1,219 million gallons of product with

a value of approximately $12.4 billion (III-B-1 pg. 3-9). The

industry includes hundreds of companies, each manufacturing in

excess of $100,000 worth of product per year (III-B-1 pg. 3-9 and

3-11). Regulated entities actually sell and ship a significant

portion of this product on an interstate basis. The trade

association representing the paint industry estimated that only

between 5 and 7 percent of the architectural coating

manufacturers limit the marketing of their architectural coatings

to an intrastate (single State) area (IV-J-19). With regard to

architectural coatings alone, the NPCA estimates that there are

approximately 42,000 retail outlets for the product throughout

the United States. It should also be noted that the products

covered by the architectural coatings rule are comprised of

numerous components such as resins, pigments, solvents, and other

additives that are themselves significant items in interstate

commerce (III-B-1 pg. 3-2). In 1991, manufacturers used a total

of approximately 4,396 million pounds of resins, pigments,
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solvents, and additives as raw materials in their products

(III-B-1 pg. 3-2). 

The EPA believes that the data regarding the size and

composition of the industry affected by the architectural

coatings rule demonstrates that Congress and the EPA are seeking

to regulate products that, in the aggregate, have a substantial

impact on interstate commerce. The EPA, thus, concludes that the

regulation of architectural coatings is within Congress’ power

under the Commerce Clause, in accordance with the Supreme Court’s

recent opinion in Lopez. For this reason, the EPA believes that

the other judicial opinions cited by the commenter are not

controlling and should not alter the EPA’s analysis.

2.7.6.2 Coating Manufacturers' First Amendment Rights

(Freedom of Speech, Association)

Comment: Two commenters (AIM-IV-D-55, AIM-IV-D-214c) have

alleged that the EPA’s promulgation of a rule regulating the VOC

content of architectural coatings is the result of retaliatory

action against the commenter in violation of its rights under the

First Amendment to the U.S. Constitution. The commenters alleged

that certain public statements by an EPA official made in the

course of his duties in connection with the regulatory

negotiation process evidenced an animosity toward the commenter

and other members of the regulated community. The commenters

implied that this animosity prompted the EPA to regulate

architectural coatings in such a way as to retaliate against the

commenter for having engaged in constitutionally protected

speech, with the intent to chill such expression in the future.

Response: The EPA disagrees that the determination to

regulate architectural coatings, or any aspect of the

regulations, constitutes retaliation against any person for any

reason. The EPA has determined to regulate architectural

coatings in accordance with the mandate from Congress in Act

section 183(e) which explicitly directs the EPA to regulate

consumer and commercial products that emit VOCs, and explicitly

refers to paints and coatings in section 183(e)(1)(B). As

discussed elsewhere in this BID, the decision to regulate
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architectural coatings and to place the product in the first

group of regulated products was the direct result of the EPA’s

analysis of VOC emissions in the Report to Congress.

Far from retaliating against the commenter, or the

architectural coatings industry in general, the EPA has striven

to address concerns of the commenter and the industry and to

accommodate their reasonable concerns. In addition to

solicitation of written comments, the EPA invited participation

by the commenter in other forums, including the regulatory

negotiation process, public hearings, and direct meetings with

representatives of the EPA. As detailed in an August 9, 1996,

letter from the Assistant Administrator for Air and Radiation to

the commenter placed in the docket for this final rule, the EPA,

in fact, considered and made many changes in its regulatory

approach that were responsive to the commenter and the industry

in general, when such changes were appropriate and consistent

with the EPA’s statutory mandate. Specifically, the EPA has

established VOC content limits that are generally similar to the

limits petitioned for by many large and small businesses during

development of the rule. In addition, the EPA has provided

compliance flexibility through a tonnage exemption and an

exceedance fee compliance provision. Furthermore, throughout the

development of this rule, the EPA made numerous changes to the

approach and requirements based on small business and other

stakeholder involvement. To suggest that the architectural

coating regulations reflect any retaliation against the commenter

or the industry is misguided. The EPA believes that to suggest

further that the EPA designed these regulations to chill future

expression by anyone strains credulity.

The precedents concerning retaliatory governmental action

cited by the commenter further demonstrate the error of the

commenter’s allegations. For example, the EPA believes that U.S.

v Steele, 461 F.2d 1148 (9th Cir. 1972), is simply inapposite. 

That case pertained to criminal prosecution for failure to

complete census forms and the government’s actions to prosecute
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certain individuals who were vocal opponents of the census. The

Steele defendant argued that the government had chosen him for

prosecution because of his vocal opposition to the census simply

because the government had failed to show that its selection for

prosecution either rested upon a valid ground or was merely

random. Id. At 1152. The EPA’s promulgation of regulations to

regulate the architectural coatings industry, or even segments of

that industry, do not constitute singling out of individuals for

selective prosecution. Any differentiation made between the VOC

content of particular types of products does not demonstrate the

equivalent of “discriminatory prosecution.” The determination to

regulate the products and the VOC content limits set in the

regulations reflect the results of an extensive, open, and

inclusive regulatory process amply demonstrated by the items in

the docket. Thus, any supposed improper differentiation or

selection in fact has a valid and permissible ground of the type

discussed by the Steele court. 

The EPA also believes that the commenter mistakenly cited

cases with allegations of particularly egregious alleged behavior

by governmental officials, above and beyond anything that the

commenter alleged in connection with the architectural coatings

rulemaking. For example, in Gibson v. U.S., 781 F. 2d 1334 (9th

Cir. 1986), the plaintiffs fired a battery of allegations against

various law enforcement officials to support claims under

42 U.S.C. §§1983 and 1985, the Federal Tort Claims Act, and the

judicial rule under Bivens v Six Unknown Agents, 403 U.S. 388

(1971). Solely in the context of determining whether the trial

court properly dismissed the plaintiff’s action for failure to

state a claim, the Gibson court enumerated a litany of

allegations that included, inter alia: frequent low level

helicopter flights over the plaintiff’s house, transmission of

defamatory information to the plaintiff’s employer, illegal

wiretaps of the plaintiff’s home for 9 years, and a “campaign of

intimidation, burglary, and petty arson.” Id. at 1342. Without

assessing the truth of any of these allegations, the Gibson court
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merely determined that summary judgment against the plaintiff had

been improper. Id. at 1345. 

In contrast, the commenter here merely alleged that a

representative of the EPA made statements in public during the

regulatory negotiation process that the commenter characterized

as “arrogant” and “threatening.” Examination of the summaries of

the meetings in the docket dispels the shadow of bias that the

commenter sought to create. The statements in question do not

establish bias; they merely constituted a common sense

observation that it was in the best interest of the industry to

participate in the regulatory negotiation process to develop a

satisfactory approach that the EPA could use as a basis for the

proposed rule in accordance with the Negotiated Rulemaking Act. 

The commenter evidently mistakenly believes that a representative

of the EPA is not permitted to advocate the position of the EPA

in the regulatory negotiation process, or indeed, to advocate any

position.

The EPA believes that the controlling case law supports the

EPA’s position that such vague and unsubstantiated allegations

are insufficient to establish the existence of a supposed bias. 

Courts apply a presumption that policy makers with decision

making power exercise their authority with honesty and integrity. 

See Schweiker v. McClure, 456 U.S. 188, 195 (1982). To overcome

the presumption, a party must make a strong showing of bad faith

or bias. Citizens to Preserve Overton Park, Inc. v. Volpe, 401

U.S. 402, 420 (1971). A mere unsupported allegation is

insufficient to show bias. Louisiana Ass’n of Indep. Producers

v. FERC, 958 F.2d 1101, 1119 (D.C. Cir. 1992). Further, it is

well established that in a rulemaking context (as opposed to an

adjudicatory process), EPA officials are not to be disqualified

for bias or prejudgment of an issue merely because of statements

made in the rulemaking process. See Ass’n. of Nat’l Advertisers

v. FTC, Inc., 627 F.2d 1151, 1168-70 (D.C. Cir. 1979), cert.

denied, 447 U.S. 921 (1980)("[i]f an agency official is to be

effective, he must engage in debate and discussion about the

policy matters before him”). 
2-443

The commenter relied most heavily upon Soranno’s Gasco, Inc.

v. Morgan, 874 F.2d 1310 (9th Cir. 1989), which the commenter

identified as the leading case concerning improper governmental

action in retaliation for exercise of First Amendment rights. 

That case addressed a dispute between a seller/distributor of

petroleum products and a California Air Pollution Control

District (APCD). The APCD temporarily suspended the plaintiff’s

license to sell gasoline for failure to supply legally required

information and the plaintiff alleged that the suspension was

actually in retaliation for its public opposition to, and pending

litigation against, regulations developed by the APCD.

The EPA believes that the Soranno case confirms that the

EPA’s regulations cannot constitute governmental retaliation. 

First, following Mt. Healthy City School Dist. Bd. of Educ. v.

Doyle, 429 U.S. 274, 287 (1977), the Sorrano court noted that a

plaintiff alleging “retaliation for the exercise of

constitutionally protected rights must initially show that the

protected conduct was a substantial’ or motivating’ factor in

the defendant’s decision.” Sorrano, 874 F.2d at 1314. Assuming

that a plaintiff can make that showing, the Sorrano decision

indicates that the defendant then has a burden of proof to show

not that it could have taken the action in question regardless of

the plaintiff’s constitutionally protected conduct, but that it

would have. Id. In accordance with the latter point, the mere

fact that a governmental entity has the legal authority to take

an action against the plaintiff under certain circumstances is

not, in itself, dispositive of whether it would have taken that

action absent the plaintiff’s exercise of protected rights. Id.

At 1315.

The EPA believes that the commenter cannot even make the

initial showing under the Sorrano decision that any alleged

retaliation was a “substantial” or “motivating” factor in the

EPA’s issuance of regulations, because it was not a factor at

all. The EPA’s promulgation of regulations was the result of an

express statutory mandate from Congress in Act section 183(e). 

The particulars of the regulations are the result of an
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extensive, open, and inclusive regulatory process in which the

commenter and many others participated. In accordance with the

second prong of the analysis in Sorrano, the EPA believes that

the extensive and comprehensive docket supporting the

architectural coating regulations demonstrates that the EPA

“would” have issued such regulations, and “would” have issued

them in the same form, regardless of the commenter’s exercise of

its rights under the First Amendment. Moreover, the docket

further illustrates that the EPA in fact made numerous

accommodations for the commenter, within the constraints of the

requirements of the statute and when otherwise appropriate. The

EPA welcomes, encourages, and appreciates the exercise of First

Amendment rights by all persons, but does not concur that this

includes the right to dictate to the EPA exactly when and how to

regulate. Finally, the EPA believes that the commenter is not

entitled to “chill” the legitimate exercise of First Amendment

rights by representatives of the EPA via unfounded and

unsubstantiated allegations of bias or retaliatory motivation.

2.7.6.3 Taking Under the Fifth Amendment

Comment: Two commenters (AIM-IV-F-1c; AIM-IV-D-214c) argued

that the regulation of the VOC content of architectural coatings

will effect a taking compensable under the Taking Clause of the

Fifth Amendment to the U.S. Constitution which provides that

“private property [shall not] be taken for public use, without

just compensation.” U.S. Const., Amdt. 5. The commenters stated

that the regulations would impair or destroy the value of its

formulas, good will, and other unspecified “intangible property

rights” in connection with its production and sale of

architectural coatings.

Response: The EPA disagrees that these regulations effect a

taking in violation of the Taking Clause. The EPA’s conclusion

is based on the following standard taking analysis. 

The Taking Analysis. The determination of when a

compensable taking occurs is “a problem of considerable

difficulty” for which the Supreme Court has not developed any

“set formula.” Penn Central Transp. Co. V. City of New York, 438
2-445

U.S. 104, 123-24 (1978). Contrary to the assertion of the

commenter, mere diminution in value of the property, without

more, does not establish a taking. Id. at 131. The Supreme

Court has developed three factors for courts to weigh in

assessing whether a regulation effects a compensable taking: 

(1) the character of the governmental action; (2) the economic

impact of the action; and (3) the action’s interference with

reasonable investment-backed expectations. Ruckleshaus v.

Monsanto Co. , 467 U.S. 986, 1005 (1984). Any one of these

factors may be decisive if it is “so overwhelming ... that it

disposes of the taking question.” Id. The EPA believes that

analysis of the architectural coatings rule in accordance with

these three factors establishes that there is no compensable

taking under the Taking Clause.

The character of the government action. Under the first

factor, courts are more likely to find a taking when the

interference with property may be characterized as a physical

invasion by the government or as a commandeering of property for

the government’s own use, than when the interference is merely

the result of a regulatory program that “adjust[s] the benefits

and burdens of economic life to promote the common good.” Penn

Central, 438 U.S. at 124. Courts accord particular deference to

governmental actions designed to protect public health, safety,

and welfare. See, e.g., Keystone Bituminous Coal Ass’n v.

DeBenedictis, 480 U.S. 470, 488 (1987); Penn Central, 438 U.S. at

125-26.

First, the regulations do not cause any physical invasion of

the property of the regulated community. In addition, the effect

of the regulations may be to limit the utility of certain types

of property to the regulated community, but the regulations do

not constitute a taking of that formula for use by the government

itself. The government, thus, "has taken nothing for its own

use." Connolly v. Pension Benefit Guar. Corp., 475 U.S. 211, 224

(1986). 

Second, with the enactment of section 183(e) of the Act by

Congress and the promulgation of these regulations by the EPA at
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Congress’ behest, the government is seeking to protect public

health, safety, and welfare. Congress determined that the

prevalence of groundlevel ozone pollution poses a serious threat

to the populace of the nation and explicitly instructed the EPA

to develop regulations that would reduce the emission of VOC

ozone precursors from consumer and commercial products in order

to lessen this threat (See 42 U.S.C. § 7511b). Congress

expressly included “paints, coatings, and solvents” in the

definition of consumer products. 42 U.S.C. § 7511b (e)(3)(A). 

By setting appropriate VOC limits for architectural coatings, the

EPA has formulated regulations that substantially advance, and

are rationally related to, the EPA’s legitimate interest in

protecting public health, safety, and welfare. By effecting a

partial reduction of VOC emissions from architectural coatings as

instructed by Congress, the regulations will help alleviate

tropospheric ozone pollution in conjunction with other reductions

from other products and other sources. See Keystone, 480 U.S. at

485. Indeed, the government's regulation of VOC emissions

arguably constitutes action to address a condition that does, or

could, constitute a common law nuisance, and it is axiomatic that

no compensation is required for governmental actions to address

such a condition. Lucas v. Carolina Coastal Council, 505 U.S.

1003, 1029-30 (1992).

For the foregoing reasons, the EPA believes that this factor

of the taking analysis demonstrates that there is no compensable

taking as a result of the architectural coating regulations.

The economic impact of the government action. The second

factor in the taking analysis is the economic impact of the

regulation. Courts have indicated that there is “no fixed

formula to determine how much diminution in value is allowable

without the fifth amendment coming into play.” Florida Rock

Indus., Inc. v. U.S., 791 F.2d 893, 901 (Fed. Cir. 1986), cert.

denied, 479 U.S. 1053 (1987). Nevertheless, past decisions

clearly hold that mere diminution in value, without more, is not

enough to establish a taking, and that a regulation may have

significant economic impact without constituting a taking. See,
 Under the tonnage exemption provisions, each manufacturer 4

can exempt a quantity of coatings that contains no more than

23 megagrams (25 tons) of VOC during the first 15 months,

18 megagrams (20 tons) of VOC in the year 2001, and 9 megagrams

(10 tons) of VOC per year in the year 2002 and each year

thereafter.

2-447

e.g., Concrete Pipe and Products of California, Inc. v.

Construction Laborers Pension Trust for Southern California, 508

U.S. 602 (1993)(citing cases finding no taking despite diminution

of up to 92.5 percent). Mere denial of the most profitable or

beneficial use of property does not require a finding that a

taking has occurred. Andrus v. Allard, 444 U.S. 51, 66 (1979). 

In light of this backdrop, the EPA believes that the

architectural coatings rule will not constitute a compensable

taking. First, the regulations will not operate as a total

taking of any property of the regulated entities. With respect

to paint formulas, nothing in the regulations will prevent the

use of a particular formula completely. The architectural

coatings rule provides a “tonnage exemption” which will allow

manufacturers and importers to sell or distribute limited

quantities of architectural coatings that do not comply with the

VOC content limits and for which no exceedance fee is paid . [See 4

Final Rule, section 40 CFR 59.408]. This approach continues to

accommodate small businesses, niche markets, and specialty

products and the EPA has provided this exemption as one means of

allowing manufacturers and importers to continue to market

reasonable amounts of products that could not comply by

reformulation, while limiting the VOC emissions that would result

from the exemption. Second, the regulations provide an

exceedance fee mechanism which will allow manufacturers or

importers to continue to market noncomplying products in amounts

above the limits of the tonnage exemption if they pay an

exceedance fee. [See Final Rule section 40 CFR 59.403]. The EPA

believes that the exceedance fee will cause regulated entities

and consumers to internalize some of the costs of the pollution

caused by the excess VOC content of the products and
2-448

simultaneously will encourage manufacturers and importers to

develop and market complying products. The EPA recognizes that

the process of reformulation and testing of new products will

require time and investment by the regulated entities and

anticipates that the exceedance fee mechanism will allow

regulated entities flexibility to develop complying products. In

addition, paint manufacturers will still have the ability to

manufacture paint without modification of their formulas for the

foreign market. [See Final Rule section 40 CFR 59.400]. The EPA

thus believes that the architectural coating rule will not

constitute a complete taking of any property of the regulated

entities in the form of formulas. 

Although compliance with the architectural coatings

regulations will require expenditures and may mean that regulated

entities have to make changes in their products, the regulated

entities will not be denied the economic value of their property. 

The VOC content limits may require some regulated entities to

reformulate or modify some of their products that will not

otherwise meet the limits or fall into regulatory exemptions. 

Information obtained during the regulatory process from other

sources and commenters establishes that reformulation is feasible

and, in fact, has already occurred with success in States that

currently have regulations governing the VOC emissions from this

type of product III-B-1 pg. 2-9). Reformulation may be costly,

as argued by the commenter, but the imposition of regulations

that cause a regulated entity to expend money to comply is not

the type of economic impact that results in a compensable taking. 

See Concrete Pipe, 508 U.S. at 644-45 (claimant's property cannot

be divided into what was taken and what was left in order to show

that the taking of the former is complete); Atlas Corp. v. U.S.,

895 F.2d 745, 756 (Fed. Cir. 1990) (regulatory requirement that

mining corporations expend money to reclaim mill tailings and

decommission contaminated mills does not constitute a taking).

Examination of the economic impact factor of the taking

analysis indicates that the regulations will not constitute a

taking of the property of the regulated entities.
2-449

Interference with reasonable investment-backed expectations. 

The final factor of the taking analysis is whether a regulated

entity has a reasonable investment-backed expectation in

continuing to use the property at issue, whether it be formulas,

goodwill, or other forms of property, exactly as it has used the

property in the past. To be reasonable, expectations must take

into account the power of the Government to regulate in the

public interest. Pace Resources v. Shrewsbury Township, 808 F.2d

1023, 1033 (3rd Cir. 1987). Reasonable expectations must also

take into account the regulatory environment, including the

foreseeability of changes in the regulatory scheme. Concrete

Pipe, 508 U.S. at 645 (those who do business in the regulated

field cannot object if the legislative scheme is buttressed by

subsequent amendments to achieve the legislative end); California

Hous. Sec., Inc. v. U.S., 959 F. 2d 955, 959 (Fed. Cir.), cert.

denied, 506 U.S. 916 (1992)(members of a regulated community are

“on notice that [they] might be subjected to different regulatory

burdens over time”) .

Some state and local governments have regulated

architectural coatings as sources of VOC for years (III-B-1

pg. 2-9). For example, the California Air Resources Board (CARB)

established a model rule for use by that state’s air pollution

control and air quality management districts in 1977. Of the 34

California local air districts, 16 have already adopted

architectural coating rules. The CARB model rule includes VOC

content limits for numerous categories of architectural coatings

also covered by the EPA’s architectural coatings rule. In some

instances, the CARB rule standards are in fact more stringent

than those in the EPA’s final architectural coatings rule.

[Compare, e.g., Final Rule section 59.402 with South Coast Air

Quality Management District Rule 1113]. 

The EPA believes that the manufacturers and importers in

general, and the commenter in particular, are on notice that

their products are potentially subject to governmental regulation

and have had reasonable notice that the regulatory scheme to

limit the VOC content of their products might change. See
2-450

Dunn-Edwards Corp. v. South Coast Air Quality Management

District, 19 Cal. App. 4th 519 (1993)(rejecting claims by

regulated entities that SCAQMD failed to respond to certain

industry concerns prior to amending state VOC content

regulations). The EPA, likewise, believes that regulated

entities are on notice that they must comply with regulations

governing the VOC content of their products. See U.S. v. Vista

Paint Corp., 976 F.2d 139 (9th Cir. 1992), cert. denied, 510 U.S.

826 (1993). A number of manufacturers and importers have already

modified their products to comply with existing State regulations

and have begun to market lower VOC content products throughout

the nation. [See, e.g., items IV-D-26, IV-D-114, IV-D-161,

IV-G-04 in the Docket.] 

Finally, the EPA notes that the Supreme Court has stated

that investment-backed expectations in personal property, are by

their nature, limited:

[I]n the case of personal property, by reason of the State’s

traditionally high degree of control over commercial

dealings, [the property owner] ought to be aware of the

possibility that new regulation might even render his

property economically worthless (at least if the property’s

only economically productive use is sale or manufacture for

sale).

Lucas, 505 U.S. at 1027-1028. Since the property noted by the

commenter (formulas, goodwill and unspecified intangible

property) is personal property, there can be no reasonable

investment-backed expectation of absolute protection from

regulation that renders them economically less valuable or even

economically worthless. 

Application of this final factor confirms that the

architectural coatings rule will effect no taking of the

regulated entities’ property as contemplated by the Fifth

Amendment.

2.7.6.4 The Tenth Amendment (Delegation Powers)

Comment: One commenter (AIM-IV-D-214c) suggested that the

architectural coatings rule is suspect under the Tenth Amendment

to the U.S. Constitution. The commenter argued that Congress
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improperly enacted Act sections 110, 172, and 182, because they

purportedly allow the EPA to force states to regulate in

compliance with the standards of the Act. The commenter cited

the Supreme Court decision in New York v. U.S., 505 U.S. 144

(1992), in support of the proposition that Congress cannot usurp

powers not expressly delegated to it under the Constitution and

cannot “conscript” state and local governments to enforce Federal

laws. Because these provisions of the Act are allegedly

unconstitutional, the commenter also questioned the EPA’s

reasoning that a national architectural coatings rule would

provide an attractive alternative to numerous State regulations

with potentially inconsistent standards. Apparently, the

commenter argues that if the Act is unconstitutional, States will

not feel compelled to regulate architectural coatings in any

fashion.

Response: The EPA disagrees with these comments. The EPA

believes that the provisions of the Act, and hence the

architectural coatings rule, do not violate the Tenth Amendment. 

The Tenth Amendment provides that “[t]he powers not delegated to

the United States by the Constitution, nor prohibited by it to

the States, are reserved to the States respectively, or to the

people.” It follows that “[i]f a power is delegated to Congress

in the Constitution, the Tenth Amendment expressly disclaims any

reservation of that power to the States.” New York v. U.S., 505

U.S. at 156. Because the EPA is acting in accordance with the

Act, which Congress enacted under its Commerce Clause authority,

the architectural coatings rule does not violate the Tenth

Amendment.

The EPA further disagrees that the cases cited by the

commenter render the enumerated provisions of the Act suspect as

improper impositions of Federal authority upon States. The Act

encompasses, inter alia, the concept of “cooperative federalism”

in the form of national emission standards which States may meet

through State regulation and State implementation plans. If a

State chooses not to regulate, the Federal Government will do so

through the mechanism of a Federal implementation plan. If a
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State chooses to regulate in lieu of the Federal Government, it

must meet Federal requirements set forth in the Act and related

regulations. The Supreme Court has held that Congress may offer

States the choice of regulating an activity according to Federal

standards or having State law preempted by Federal regulation. 

New York v. U.S., 505 U.S. at 167; accord, Hodel v. Virginia

Surface Mining & Reclamation Assn., 452 U.S. 264, 290 (1981);

FERC v. Mississippi, 456 U.S. 742, 746 (1982). Where States have

a choice of implementing Federal standards through State law, or

having the Federal Government implement Federal law, there is no

unconstitutional imposition upon State sovereignty.

The commenter specifically criticized the sanctions

provisions of the Act as violative of the Tenth Amendment. The

EPA notes that the U.S. Court of Appeals for the Fourth Circuit

has explicitly upheld the constitutionality of the sanctions

provisions of the Act against a direct Tenth Amendment challenge

by a State. See Virginia v. Browner, 80 F.3d 869 (4th Cir.

1996), cert. denied, 117 S.Ct. 764 (1997) (sanctions

constitutional because they “amount to inducement rather than

outright coercion’”) (citing New York v. U.S., 505 U.S. at

165-67). Congress is permitted to induce States to adopt Federal

standards.

Finally, the EPA believes that the commenter misconstrues

the nature of the architectural coatings rule as a usurpation of

State authority. First, the rule does not require State or local

governments to implement or enforce the regulations. Thus, the

architectural coatings rule does not constitute a “conscription”

of State or local governments to enforce Federal law. Second,

the final rule merely sets a Federal “floor” for VOC content

regulations, i.e., the minimum level of regulation of the

products in all States, whether implemented by the States or the

Federal Government. Nothing in the architectural coatings rule

prevents a State, as a separate sovereign, from implementing

different VOC emission control limits within its borders. Unlike

other provisions of the Act, section 183(e) does not contain an

express preemption of State and local regulations. Thus, the
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Federal rule applies whether or not there are applicable State

rules. The EPA continues to believe that a uniform national rule

with consistent VOC emission limits for architectural coatings

for all States is preferable, but the EPA will not prevent States

from regulating if they so elect. 

2.8 OUTREACH

Comment: Two commenters (IV-D-117, IV-D-148) recommended an

outreach program to better educate consumers about coating

selection choices, the importance of scheduling coating projects

when the environmental impact is minimized (i.e., not on summer

days when the ozone standard is expected to be exceeded), and a

better understanding of available options to complete a coatings

project. Both commenters encouraged the use of private-public

outreach to maximize the benefits of the architectural coating

rule. One commenter (IV-D-148) suggested an outreach program be

developed through a partnership with the coating manufacturers

and National Paint and Coatings Association (NPCA) and

implemented through the States. 

Another commenter (IV-D-120) stated that an outreach program

based exclusively on architectural coating, as opposed to the

entire VOC-emitting and ozone-forming community, would create a

bias against the coatings industry, and leave the public

misinformed as to the larger picture of other contributing

emission sources.

Response: Outreach is targeted for the regulated community

and others affected by a rule. Outreach opportunities include

using literature to disseminate information about an industry;

participation in training courses, trade shows, or meetings; and

coordinating with the Small Business Assistance Program. 

Literature may include fact sheets the EPA prepared during rule

development or pamphlets produced by the EPA Regional Office or a

State or local entity to address specific needs of a geographic

area. The EPA also considers preparing plain-English guides (or

other languages) for the regulations, especially those affecting

small businesses. Education efforts such as training courses

often provide outreach opportunities. At times, the EPA provides
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technical assistance to these seminars through expert speakers

and literation. Other training opportunities include satellite

downlink courses. These courses are usually presented by the EPA

through a university grant and often have trade associations as

joint sponsors. These courses involve the EPA, State, and

industry representatives, and the resulting videotapes can be

distributed to an even wider audience.

The EPA will consider which outreach tools will be most

appropriate for the architectural coating rule. The Agency will

consider the input of coating manufacturers, distributors, and

retailers in developing and implementing the program in order to

maximize its effectiveness.

Comment: One commenter (IV-D-10), who believed the EPA

rushed publication of the proposed rule, requested that the EPA

cancel the public hearing and enter into meaningful discussions

with industry. One commenter (IV-D-1l, IV-F-1c) expressed

concern that the short comment period provided insufficient

notice for the large body of industry and other interested

parties to comment on the proposal. The same commenter (IV-D-16)

expressed concern in another letter that the EPA Headquarters

finds it difficult to communicate with the industry when it is so

easy for the commenter to communicate with the EPA regional

staff. Another commenter (IV-D-30) stated that their company

shared other companies’ concerns that the EPA appeared to display

a genuine lack of effort in communicating the rule and notice to

companies outside the NPCA. Another commenter (IV-F-2f)

maintained that all of the affected manufacturers are not finding

out about the proposed rule and suggested that the EPA and the

Small Business Association evaluate their method of

communication. This small business ($8 to $9 million per year)

of concrete curing compound materials stated that curing

compounds are a major part of the industry, and their company

only recently became aware of the proposed regulation.

Response: The proposed rule for architectural coatings was

published in the Federal Register on June 25, 1996. The public

comment period was initially 60 days, but was later extended and
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reopened to provide a 120-day comment period. After proposal of

the rule, a public bearing and a public meeting were held by the

EPA on July 30, 1996 and August 13, 1996 for the specific purpose

of giving small businesses added opportunity to discuss their

concerns with the EPA. Small businesses attended these meetings

and presented comments on various issues related to the proposed

rule; responses to those comments are included in this document. 

The EPA met with concrete curing compound manufacturers in

September 1996 and has addressed their concerns in

section 2.2.4.3 of this document. On July 18, 1996 the EPA

mailed over 600 letters to small and medium-size coating

manufacturers announcing publication of the rule; requesting

comments on specific aspects of the proposed rule; and announcing

the public hearing, comment period, and small business meeting. 

The July 18, 1996 mail-out included a Fact Sheet and a copy of

the proposed rule. 

After the final rule is published in the Federal Register,

the EPA plans to take the following steps: (1) notify the

industry, including trade associations and other groups, of

publication of the final rule and send copies of the final rule;

and (2) prepare and distribute materials and, if resources are

available, hold workshops to aid manufacturers in complying with

the rule. The EPA will discuss implementation plans with the

SBA, the EPA Regional Offices, and State and local agencies in an

effort to reach all coating manufacturers affected by the rule.
APPENDIX A

SUMMARY OF REFORMULATION COST ESTIMATES

FROM PUBLIC COMMENTS
A-1

In performing its EIA for the proposal of this rule, the

EPA’s estimate for per product reformulation cost was based on an

estimate for a hypothetical new coating included in a

presentation to the Regulatory Negotiation committee based on a

more stringent Table of Standards. This one-time cost estimate

was $250,000, implemented over 3 years at $83,333 per year.

The EPA solicited public input regarding the size and nature

of reformulation costs to gauge the reasonableness of (and

potentially modify) the estimate used in the EIA. The public

comments on costs were reviewed for this purpose. Costs received

were organized in the following manner:

& Technical staff training & Prioritization of products needing reformulation & Survey available materials & Reformulate to desired properties & Performance tests & Field tests & Marketing costs & Production costs (labels) & Sales training & Executive expenses

Upon review of the public comments on costs, twelve of the

responses appeared to provide comparable and useful information

for gauging lump-sum reformulation costs per product. Other

responses presented costs for all of the company’s products, but

did not provide information on the number of products to enable

computation of cost per product. Other responses could not be

used either because of incompleteness or lack of clarity about

the information provided. Summary statistics for the twelve

potentially comparable responses, plus the original estimate from

the regulatory negotiation are as follows:

& Minimum: $656 & Maximum: $310,000

& Mean: $94,313 & Median: $63,500
A-2

As this indicates, the central tendency estimates (mean and

median) are well below the $250,000 lump-sum cost per product

estimate used in the EIA at proposal, ranging anywhere from

19-56 percent of that estimate.

In summary, a review of the public comments related to

reformulation costs suggests that the EPA overestimated the per

product costs by a factor of two to five times, rather than

underestimated these costs. Thus, the lump-sum cost per product

used in the EIA appears to be a conservatively high estimate. 

For the analysis of the final rule, the EPA uses this information

from public comments along with the original estimate obtained

for proposal to derive an average estimate of the cost of

reformulating a product.
APPENDIX B

CALCULATION OF ANNUALIZED REFORMULATION COST 

UNDER FINITE PRODUCT LIFE
NPV(	4) 
 $250,000/1.07^4 
 $190,724

NPV(0) 
 $250,000.

Initial Net Effect 
 NPV(0) 	 NPV(	4) 
 $59,276

 This value is the result of developing a $250,000 5

formulation over a 3-year period (at $83,333 each year) and

annualizing that value at a 7 percent interest rate over the life

of the low-VOC technology in the formulation (which is assumed to

be infinite).

B-1

(3)

(4)

(5)

Several comments received by the EPA state that the

annualized cost of reformulation ($17,772 per year) used in the

economic impact analysis (EIA) at proposal was too low . Two 5

elements of the per product cost estimate can be modified to

consider the reasonableness of the original estimate. Appendix A

provided a discussion of the lump-sum cost of a product

reformulation. The discussion below looks at another element of

the annualized cost - the useful life of a reformulated product.

Suppose a company routinely reformulates products every

8 years. If the average product is midway through its

reformulation cycle, it will be reformulated (and costs will be

incurred) 4 years in the future in the absence of the regulation. 

However, the regulation requires them to do the reformulation now

rather than 4 years in the future and this acceleration imposes

costs on the firm. To estimate the costs of this acceleration,

assume the cost of $250,000 all in 1 year, rather than $250,000

over 3 years stipulated in the EIA. Then the net present value,

today, of a cost that is otherwise deferred 4 years into the

future is: 

Instead, the company is required to reformulate today at a cost

of: 

The net effect on the company of accelerating the next

formulation is then:
V(0) = $250,000 + $250,000 (1/ ((1.07) ^8 	 1))

= $598,099

V(	4) 
 V(0)/1.07^4 
 $456,287

Total Net Effect 
 V(0) 	 V(	4) 
 $141,812

B-2

(6)

(7)

(8)

Thus, if the regulation just accelerates the next reformulation,

the one-time cost of that acceleration is approximately $60,000. 

This is substantially below the one-time cost of $250,000 assumed

in EIA at proposal. However, if it is assumed that this

requirement also forces all future reformulations to be moved up

4 years, then the computation must be expanded to measure the

present value of the current and all future adjustments. To

start, the present value of an initial $250,000 cash expenditure

repeated every 8 years thereafter can be written:

Without the regulation, this stream of costs would be deferred

4 years into the future. Evaluating this in present value terms

gives:

Thus, the difference in present value between the two

reformulation cost streams is the total net effect of

accelerating this and all future reformulations.

This can be viewed as conceptually equivalent to a one-time cost

of the regulation for an average product that is over-the-limit. 

This explicitly accounts for the net present value of the

regulations’s affect on all future formulations. This one-time

cost is substantially below the $250,000 one-time cost assumed in

the analysis at proposal. The amortized value of this estimate

is $9,927 per year.

By comparison, if the product were otherwise to be

reformulated 1 year in the future without the regulation, the

present value of this cost acceleration can be computed in a

similar fashion as $39,128 (16 percent of $250,000). If the

previous reformulation had been implemented just 1 year before
B-3

the regulation, then the present value of accelerating the future

reformulation cycle by 7 years would be $225,633 (90 percent of

$250,000).

In summary, the one-time cost estimate of an accelerated

reformulation schedule ranges from a small fraction to a large

fraction of the reformulation cost estimate used in the EIA. In

this example, the average product’s one-time cost equivalent is

less than 60 percent of the estimate used in the EIA. Thus, the

EPA contends that it has provided a conservatively high estimate

of reformulation costs at proposal.
EPA Form 2220-1 (Rev. a-77) PREVIOUS EDITION IS OBSOLETE

TECHNICAL REPORT DATA

(please read instructions on the reverse before completing)

1. REPORT NO. 2. 3. RECIPIENT'S ACCESSION NO.

EPA-453/R-98-006b

4. TITLE AND SUBTITLE 5. REPORT DATE

National Volatile Organic Compound Emission Standards

for Architectural Coatings -- Background for Promulgated

Standards

August 1998

6. PERFORMING ORGANIZATION CODE

7. AUTHOR(S) 8. PERFORMING ORGANIZATION REPORT NO.

9. PERFORMING ORGANIZATION NAME AND ADDRESS 10. PROGRAM ELEMENT NO.

Office of Air Quality Planning and Standards

U.S. Environmental Protection Agency

Research Triangle Park, North Carolina 27711 11. CONTRACT/GRANT NO.

12. SPONSORING AGENCY NAME AND ADDRESS 13. TYPE OF REPORT AND PERIOD COVERED

Office of Air and Radiation

U.S. Environmental Protection Agency

Washington, DC 20460

Final Report

14. SPONSORING AGENCY CODE

EPA /200/04

15. SUPPLEMENTARY NOTES

16. ABSTRACT

National volatile organic compound (VOC) emission standards are being promulgated for

architectural coatings under authority of section 183(e) of the Clean Air Act (Act). 

This background information document contains a summary of the changes made to the

standards since proposal, a summary of all the public comments on the standards, and

the Administrator’s response to the comments.

17. KEY WORDS AND DOCUMENT ANALYSIS

a. DESCRIPTORS b. IDENTIFIERS/OPEN ENDED TERMS c. COSATI Field/Group

Air pollution control, Air pollution control

Architectural coatings,

Consumer and commercial

products, Environmental

protection, Ozone,

Volatile organic

compounds. 

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Unlimited

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