p. 1 CBIC Control Number CHAMBER OF COMMERCE

OF THE UNITED STATES OP AMERICA

WILLIAML . $OVACB SENIOR VICE PRESIDENT ENVIRONMENT, TECHNOLOGY dt REGULATORY AFFAIRS 

### EPA -~~--



# rLOV 0a 203

BY ELECPRONIC MAIL DOCKET CENTER September 25, 2013 Document Control Office (7407M) Office of Pollution Prevention andToxics Environmental Protection Agency 1200 Pennsylvania Ave. NW Washington, DC20460-0001 

# 356271

1675 H STREET, NW WASHINGTON, DC 20062 (202) 463-5457

N O W

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### Re: Comments on lF!amnatdehyde;'I'hird-Party Certification Frsumework for the Parnsaldehydc 8taadptds far CaKnpQallta Wood Products, EPADocket IDNumber EPA-HQ-OPPT-2011-Q380 Dear Sir/Madam

: The U .S . Chamber of Commerce, the world's largest business federation . representing the interests ofmare than three million businesses of all sizes, sectors, and regions, as well as state and local chambers and industry associations, and dedicated to promoting, protecting, and defendingAmerica's free enterprise system, is pleased to submit these comments to the Environmental Protection Agency (EPA) regarding the proposed rule titled "Formaldehyde;Third-Party Certification Framework for the Formaldehyde Standards for Composite Wood Products", 78 Fed. Reg . 34796 Oune 10, 2013), EPADocket ID Number EPA-HQ-OPPT-2011-038() . Many of the Chambers members use, manufacture, or otherwisewould be directly or indirectly impacted fromthe regulation of formaldehyde. The Chamber is concerned that EPA has (1) needlessly split the formaldehyde rule into twoseparate rulemakings, (2) overreached and exceeded its congressionally mandated duties in multiple significant ways, and (3) failed to implement key recommendations made to EPAas a result of the Snuff Business Advocacy Review (SBAR) process. o70 -D m -u n -4 rn c"),< . om coc7Comments on EPA's Proposed Rule on Formaldehyde Third-Party Certification

September 25, 2013 

### Page 2of 6 Background OnJuly 7, 2010, President Obama signed the Formaldehyde Standards for Composite-Wood Products Act (FSCWPA) into law .' This legislation added a new Title VI to the Toxic Substance Control Act (TSCA)a that establishes limits for formaldehyde emissions standards for hardwood plywood, medium-density fiberboard, and partideboard. The legislation requires EPAto create federal formaldehyde emission standards identical to the current California Air Resources Board's (CAM) Airborne Toxic Control Measure (ATCM) Phase II standards. EPAaccordingly had been tasked by Congress with issuing supplementary TSCA regulations in a manner that ensures compliance with CARB's formaldehyde emissions standards, These regulationswould create a single nationwide formaldehyde emission standard forwood composite products and allow those manufacturers that are already complying with the CARB standards to not be at a competitive disadvantage. TSCA Title VI requires EPA toestablish third-party testing and certification requirements to ensure compliancewith the formaldehyde emission standards the agency is adopting. OnJune 10, 2013 EPAissued a proposed rule for Third-Party Certification Fratnework3alongwith its proposed Formaldehyde Emissions Standards for Composite Wood Products.4 I, 1}i u at3on of the Formaldehvde Rule As a threshold matter, it is unclearwhy EPAchose to issue the formaldehyde rule in two parts. These two proposed rules are wholly dependent upon each other and neitherworks without the other. Both proposals were published on the same day . The public should have been allowed to commenton the rule as awhole rather than two separate pieces. It makes no logical or practical sense to have two separate proposed rules that are interconnected and dependent. EPAshould repurpose the two rules as one single proposed rule. I P .L 111-199 (2010) . 2 F.L. 94-469 (1976) . 3 78 Fed Reg 34796 Qune 10, 2013) . 4 78 Fed. Reg 34820 Qune 10, 2013) .Comments on EPA's Proposed Rule on Formaldehyde Third-PartyCertification

September 25, 2013 

### Page 3 of 6 II . CoW-Msional M n tg,and EPA Overreach The goal of the FSCWPAwas to implement nationwide the California formaldehyde emission standards already in existence that many regulated entities are already complyingwith. The CARB regulations have now been in effect for over five years, and markets and consumers are familiar with them . EPA has a clear Congressional mandate to implement a federal formaldehyde standard that is identical toC,ARB's. Instead, EPAhas overreached and deviated significantly fromthe California rule. EPA's proposed rule for Third-Party Certification Framework differs substantially fromthe CARB standards and is therefore contrary to EPA's Congressional mandate . EPAhas also provided little if any rationale why their overreach is necessaryor justified. 1 . Agents for Third-Party Certifiers CARB's ATCM

Phase II standards do not require international third-party certifiers to have an agent in California or elsewhere in the U .S. By contrast, EPA's proposed rule requires third-party certifiers based outside of the U .S: to designate an agent in the U

.S. CARB has not had any issues with international third-party certifiers and EPAfailed to provide a sufficient and valid reason for this additional requirement. This is a needless requirement that unfairly burdens international thirdparty certifiers without any corresponding benefit. EPA fails to justlfywhy its rule should deviate away fromthe CARB rule. EPAneeds to alignits third-party certifier requirement for international thirdparty cerdfiers to match CARB and not require international third-party certifiers to have an agent in the U

.S. 2 . Record Retention Requirement EPAproposes to require third-party certifiers to maintain records electronically for three years. This is one year more than what CARB requires. This period begins fromthe date of creation of the records. Significantly, each downstream customer, including fabricators, importers, wholesalers and retailers is also required to maintain records for three years fromthe date. The eventual retailer would ultimately have to maintain certification records for a longer time than the third-party certifier.Comments on EPA's Proposed Me on FormaldehydeThird-Party Certification

September 25, 2013 Page 4of 6 Without beingable to simply demonstrate compliance through a third-party certifier, downstream

customers ate made liable for the performance of the products they purchased. So this means that if there is an enforcement action at the retail level the records maintained by the third party cerdfier may no longer be available to the retailer in its defense against the action. This places downstream customers in an untenable situation regarding the liability of the products they sell . 3 . Product Certification versus Process Certification EPA's proposed rule falls to make a clear decision between product certification or process certification. The decision in choosing which certification to go with is important in determining how the third-party certification will function. Product Certification means that the third-party cettlfier confirms an individual product has actually been produced in a way that meets the required standards. In product certification, the certifying body assumes at least partial financial liability for compliance. By contrast, process certification means that the third-party cerrifier verifies that the factory is capable of producingproducts that can meet the required specification. In process cettification, the certifying body'has no liability if an actual product does not complywith the standard: Process certificationcreates liability at each stage of the supply chain ; making each party responsible for the actions of the entity prior to it in the supply chain . The manufacturer is responsible for the performance of all process-certified products, not the third-party cerdfier. By failing to choose the certification process it will require,' EPAcreates confusion and uncertainty on this crucial issue., EPAneeds to choose the process it will require

. This is a crucial part of the rule because it wilt determine who is responsible and liable for the product all the way through the chain of custody . Is it fair, for example, to hold a fabricator liable for a mill that produces non-compliant compositewood panels?

s CARBcurrently requires a process certification process . So tnderCARB's rules, the thitd-party atdHa does not best any ofthe responsibility or liability. CARB's liability sehetne creates $abiYtyateach stage ofthe supply chain fromthe manufacauer all the way down to the retailer. Further, it requires tub patty responsible for the acdona of the entity prior to it in the supply chain .Comments on EPA's Proposed Rule on Formaldehyde Third-Party Certification

September 25, 2013 Page 5of 6 This uncertainty could be very costly for our members whoare already complying with CARB's Process Certification requirement and could have to change if EPAdetermines that it will require with a Product Certification process. Even more problematic is the fact that certification process win be the key enforcement mechanismfor how this rule will be enforced. Because EPAhas not provided a clear indication of the direction it will take, the question of how and through what process enforcementwill be handled is left ambiguous. If EPAis truly seeking meaningful public input it needs to make a clear decision which direction it plans to go. If EPAchooses productcertification then the cost of the rulewilt increase significantly. If EPAchooses process certification then each part of the consumer chainis responsible and liable and this will drive the costs of the proposed rule down. III . . mAi Bti ;,1~,ff jjg,qiewI>afigt,jj,wAyicUsydations EPA convened a Small Business Advocacy Review(SBAR) Panel in the fall of 2010for its planned formaldehyde standard. During the Panet, seventeen small entity representatives (SERs) reviewed the formaldehyde rule proposal and submitted comments and recommendations to EPA, the Office of Management and Budget's Office of Information and Regulatory Affairs, andthe Small Business Administration's Office ofAdvocacy. The Panel Report containing specific small entity flexibility recommendations to the EPAAdministrator was signed on April 4, 2011 and placed in the docket' EPApublished the proposed rules onJune 10, 201V The SBAR Panel considered both proposed rules together. EPA only accepted about two-thirds ofthe 14 Panel recommendations.' This is quite rare when EPA deviates from

the consensus recommendations, and it is even rarer in the final rule.'

6 Final Report of the Small Business Advocacy Review Panel on EPA's Planned Proposed Rule Implementing the Formaldehyde Standards for Composite Wood Products Act (iBCAtitle VI), 28-32 (April 4, 201!) . 

### 7 78 Fed,xe8, 34796,34820 Qune 10, 2013). e Letter from

Winslow Satgeant, ChiefCounsel for Advocacy to Gins McCatty, Administrator of EPA, R8 : Comments on EPA's Formaldehyde Emissions Standards for Composite Wood Produces and Thud-Party Certification Framework for the Formaldehyde Standuds for Composite Wood Products: Docket Nos. EPA-HQ-OPPT-2011-0380 . EPA-HQOPPT-2012-0018 (August 21, 2013) . 9 Id. at 7Comments on EPA's Proposed Rule on Formaldehyde Third-Party Certification

September 25, 2013 Page 6 of 6 For example, the first SBAR Panel recommendation is that EPAshould adopt regulatory requirements that are consistent with CARBATCM wherever possible." EPA's proposed regulatory requirements are inconsistent with the CARBATCM and these comments as do the SBAR panel recommendations provide numerous examples where this is the case. EPAnot only did not accept this specific SBAR Panel recommendation that they match their regulatory requirements to CARB's, they provided no rationale or explanation why they would not accept it" EPAneeds to follow

the recommendations or provide a reason whytheywill not comply with the SBREFA panels' recommendations. For EPA to fail to follow the recommendations without explanation is both highly unusual and disappointing. . 

### Cornchuion I appreciate this opportunity to comment on your Third-Party Certification Framework for Formaldehyde and I hope that EPAwill address and correct the issues I have raised in our comments. Sincerely, 

### U4wp~F. ~~+~"' WilliamL. Kovacs

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