Economic Analysis of the

Proposed Dust Testing and

Clearance Amendments to the

TSCA Lead Renovation, Repair,

and Painting Program for

Target Housing and ChildOccupied Facilities

Economic and Policy Analysis Branch

Economics, Exposure and Technology Division

Office of Pollution Prevention and Toxics

U.S. Environmental Protection Agency

April 2010

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Clearance Proposed Rule

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Acknowledgment

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

Cambridge, Massachusetts, provided under Contract Nos. EP-W-08-10 and EP-W-05-022, in the

preparation of this report.

Notice

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

applicable regulatory requirements. This document was prepared to provide economic

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

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

document contains various assumptions that may not reflect the regulatory

determinations that an individual firm would make were it to apply the rule's

requirements to its specific circumstances. Persons seeking information on regulatory

requirements as they apply to specific facilities should consult 40 CFR Part 745, the

preamble for the regulatory action, EPA guidance documents, and EPA’s National

Lead Information Center.

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Economic Analysis for the LRRP Clearance Proposed Rule

Table of Contents

Executive Summary .............................................................................................................................. ES-1

Background........................................................................................................................................ ES-1

Overview of the LRRP Clearance Rule............................................................................................. ES-1

Options Analyzed .............................................................................................................................. ES-3

Number of Events.............................................................................................................................. ES-4

Costs of the Proposed Rule................................................................................................................ ES-6

Benefits.............................................................................................................................................. ES-8

Small Entity Impacts.......................................................................................................................... ES-10

1. Introduction.............................................................................................................................. 1-1

1.1 Purpose of the LRRP Rule Revisions...................................................................................... 1-1

1.2 Goal of the Economic Analysis............................................................................................... 1-1

1.3 Organization of this Report ..................................................................................................... 1-3

2. Lead, Renovation, Repair, and Painting Industry Profile...................................................... 2-1

2.1 Contractors that Supply Renovation Services......................................................................... 2-2

2.2 Child Care and Schools: Child Occupied Facilities ................................................................ 2-10

2.3 Nonresidential Commercial Property Owners and Managers ................................................. 2-23

2.4 The Demand for Renovation Services..................................................................................... 2-24

2.5 Renovation Industry Market Structure .................................................................................... 2-26

2.6 Residential Property Owners & Managers.............................................................................. 2-28

2.7 Training Providers................................................................................................................... 2-30

2.8 Summary Characteristics: Numbers of Structures in the Regulated Universe........................ 2-32

3. Problem Definition: Residential Lead-Based Paint Hazards and the Justification for

Regulation ................................................................................................................................... 3-1

3.1 Lead Contamination Problem.................................................................................................. 3-1

3.2 Regulatory Background........................................................................................................... 3-4

3.3 Justification for Federal Regulations of Lead Exposure during Renovation........................... 3-11

3.4 Approaches for Reducing Lead Exposure Resulting from Renovation .................................. 3-16

Appendix 3A: The Role of Elasticities in Determining the Impacts of a Rule ............................... 3-19

3A.1 Elasticities of Supply and Demand.......................................................................................... 3-19

3A.2 How Price Elasticity of Demand Affects the RRP Rule.......................................................... 3-24

Appendix 3B: Elasticities of Demand and Supply for Housing / Renovation Services.................. 3-26

4. Costs of the Lead, Renovation, Repair, and Painting Rule Revisions ................................... 4-1

4.1 Definitions of Options............................................................................................................. 4-2

4.2 Number of Events with Dust Wipe Testing or Clearance Requirements ................................ 4-4

4.3 Costs of Dust Sampling and Clearance ................................................................................... 4-34

4.4 Number of Sampling Technicians Seeking Training and Certification .................................. 4-63

4.5 Sampling Technician Training Costs ...................................................................................... 4-68

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Executive Summary ES-1¶

Background ES-1¶

Overview of the LRRP Clearance

Rule ES-1¶

Options Analyzed ES-3¶

Number of Events ES-4¶

Costs of the Proposed Rule ES-6¶

Benefits ES-8¶

Small Entity Impacts ES-10¶

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1. Introduction 1-1¶

1 1 Purpose of the LRRP Rule

Revisions 1-1¶

1 2 Goal of the Economic Analys

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Economic Analysis for the LRRP Clearance Proposed Rule

4.6 Total Incremental Costs of Proposed LRRP Clearance Rule.................................................. 4-70

4.7 Alternative Baseline and Options............................................................................................ 4-74

5. Benefits of the Proposed LRRP Clearance Rule...................................................................... 5-1

5.1 Overview of Proposed LRRP Clearance Rule in Terms of Benefits Estimation .................... 5-1

5.2 Residents and Occupants of Structures Regulated by the Proposed LRRP Clearance Rule ... 5-5

5.3 Lead-Related Health Effects and Ecological Effects .............................................................. 5-12

6. Estimated Impacts of the Lead, Renovation, Repair, and Painting Rule Revisions............. 6-1

6.1 Paperwork Reduction Act ....................................................................................................... 6-1

6.2 Regulatory Flexibility Act....................................................................................................... 6-15

6.3 Unfunded Mandates Reform Act (UMRA)............................................................................. 6-43

6.4 Executive Order 13132 - Federalism....................................................................................... 6-45

6.5 Executive Order 13175 - Tribal Implications.......................................................................... 6-45

6.6 Protection of Children from Environmental Health Risk and Safety Risks............................ 6-46

6.7 Executive Order 13211 - Energy Effects ................................................................................ 6-46

6.8 National Technology Transfer and Advancement Act............................................................ 6-47

6.9 Executive Order 12898 – Environmental Justice .................................................................... 6-47

APPENDIX 6A – Estimating average per-pupil expenditures of private schools........................... 6-50

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1. Introduction.................................................................................................................................1-1

1.1 Purpose of the LRRP Rule Revisions......................................................................................1-1

1.2 Goal of the Economic Analysis ...............................................................................................1-1

1.3 Organization of this Report......................................................................................................1-3

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2. Lead, Renovation, Repair, and Painting Industry Profile ......................................................2-1

2.1 Contractors that Supply Renovation Services..........................................................................2-2

2.2 Child Care and Schools: Child Occupied Facilities.................................................................2-10

2.3 Nonresidential Commercial Property Owners and Managers..................................................2-23

2.4 The Demand for Renovation Services.....................................................................................2-24

2.5 Renovation Industry Market Structure.....................................................................................2-26

2.6 Residential Property Owners & Managers ..............................................................................2-28

2.7 Training Providers...................................................................................................................2-30

2.8 Summary Characteristics: Numbers of Structures in the Regulated Universe ........................2-32

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Economic Analysis for the LRRP Clearance Proposed Rule

Executive Summary ES-1

Executive Summary

This report presents an economic analysis of alternative regulatory options for revising the lead,

renovation, repair and painting (LRRP) program regulations for target housing and child occupied

facilities (COFs). The proposed LRRP Clearance Rule changes the LRRP program by requiring

renovators to perform dust wipe testing for a subset of renovation jobs, and requiring them to re-clean and

re-test for a second subset of renovation jobs if the tests show that lead dust levels exceed the established

clearance standards.

Background

Past use of lead-based paint has resulted in contamination that continues to pose human health hazards.

While intact lead-based paint is not likely to contribute to such hazards, the deterioration of a structure

over time or acute environmental stresses, such as are commonly present during renovation activities, has

been found to create lead hazards. Since many buildings constructed before 1978 have lead-based paint,

it is likely that renovation activities in pre-1978 buildings will contribute to lead hazards unless

appropriate containment and clean-up practices are employed.

The LRRP rule for target housing and COFs was promulgated in 2008 (73 FR 21692) and is codified in

Part 745 of Title 40 of the Code of Federal Regulations (CFR). The rule was promulgated under the

authority of §402(c) of the Toxic Substances Control Act (TSCA). The existing LRRP regulations

require entities that perform renovation, repair and painting work for compensation in buildings covered

by the rule to become certified by EPA, ensure that their employees are trained as either renovators or

workers, and use lead-safe work practices when disturbing lead-based paint.

Overview of the LRRP Clearance Rule

Figure ES-1 provides a summary of the dust wipe testing and clearance requirements of the proposed rule,

and their relationship with the requirements of the 2008 LRRP rule. The proposed LRRP Clearance Rule

would require dust wipe testing on uncarpeted floors and on window sills and troughs after the following

types of renovations that disturb lead-based paint: removing more than 40 ft2of trim, molding, cabinets,

or other fixtures; removing or replacing of window or door frames; scraping 60 ft2or more of painted

surfaces; or using a heat gun at temperatures below 1100 degrees Fahrenheit2. Renovations using

machines that remove lead-based paint through high speed operation (such as power sanders or abrasive

blasting), or involving demolition or removal of more than 6 ft2of plaster walls with lead-based paint

through destructive means, would require firms to demonstrate – through dust wipe testing – that they

have met clearance standards before the renovation will be considered complete. (For interior surfaces,

the clearance standards are 40 μg/ft2on floors, 250 μg/ft2on interior windowsills, and 400 μg/ft2on

window troughs.) If any of the dust wipe test results exceed the interior clearance standards, the firm will

have to re-clean and re-test the area that failed. The proposed rule allows renovation firms to stop after

the second failed clearance test, regardless of the result, if the renovation firm did not agree to refinish the

surface that is failing clearance as part of the renovation contract. In such instances, the renovation firm

would only have to re-clean and test the surface again, no matter what the second dust wipe testing result

is. In contrast, the economic analysis assumes that if the second dust wipe testing result fails the

clearance test, the renovation firm would have to re-clean the surface a second time and test the surface a

third time. Therefore, the economic analysis overestimates the cost of the clearance requirement.

2 Under the 2008 LRRP rule at 40 CFR 745.85(a)(3)(iii), operating a heat gun on lead-based paint is permitted only at

temperatures below 1100 degrees Fahrenheit.

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Executive Summary ES-2

Figure ES-1: Summary of Required Activities for Performing Dust Wipe Testing and Clearance

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Economic Analysis for the LRRP Clearance Proposed Rule

Executive Summary ES-3

Options Analyzed

This economic analysis considers several regulatory options, which are described below and summarized

in Table ES-1 and Table ES-2.

1. Low Threshold Option

 Dust wipe testing is required for renovations that disturb more than 6 square feet of

lead-based paint through removing trim, molding, cabinets, or other fixtures; removal

or replacement of window or door frames; scraping painted surfaces; or the use of a

heat gun.

 Clearance is required for renovations that disturb lead-based paint through:

- High-speed machine removal of paint larger than 6 square feet; or

- Plaster removal using destructive means, larger than 6 square feet.

2. Proposed Rule Threshold Option

 Dust wipe testing is required for renovations that disturb lead-based paint through:

- Removal of more than 40 square feet of trim, molding, cabinets, or other fixtures;

- Scraping more than 60 square feet of paint;

- Using a heat gun to remove more than 6 square feet of paint; or

- Removing a window frame or door frame.

 Clearance is required for renovations that disturb lead-based paint through:

- High-speed machine removal of more than 6 square feet of paint; or

- Demolition or removal using destructive means of more than 6 square feet of

plaster.

3. High Threshold Option

 Dust wipe testing is required for renovations that disturb lead-based paint through:

- Removal of more than 80 square feet of trim, molding, cabinets, or other fixtures;

- Scraping more than 120 square feet of paint;

- Using a heat gun to remove more than 60 square feet of paint; or

- Disturbing paint by removing a window frame or door frame.

 Clearance is required for renovations that disturb lead-based paint through:

- High-speed machine removal of more than 60 square feet of paint; or

- Demolition or removal using destructive means of more than 60 square feet of

plaster.

4. Third Party Sampling Option

 Applies to the same renovations and size thresholds as the proposed rule.

 Dust wipe testing and clearance are required in the same instances as the proposed

rule option but dust wipe sampling must be performed by an independent third party.

5. Dust Wipe Testing Only Option

 Applies to the same renovations and size thresholds as the proposed rule.

 Achieving clearance is not required.

6. Clearance Only Option

 Applies to the same renovations and size thresholds as the proposed rule.

 Clearance must be achieved in all of these renovations.

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Economic Analysis for the LRRP Clearance Proposed Rule

Executive Summary ES-4

Table ES-1: Options Included in Economic Analysis

Option Size Threshold Dust Wipe Testing and Clearance Third Party

Requirement

Low Threshold

Option

Size thresholds are

lower or equal to

proposed rule

No

Proposed Rule Size thresholds are

as proposed No

High Threshold

Option

Size thresholds are

higher or equal to

proposed rule

Dust wipe testing is required for:

1. cabinet and trim events

2. scraping of paint

3. heat gun removal of paint

4. Window frame or door frame removal events

Clearance is required for:

1. high-speed machine removal of paint

2. plaster removal using destructive means No

Third Party

Sampling Option Same as Proposed.

Dust wipe testing and clearance are required in

the same instances as proposed but dust wipe

sampling must be performed by an independent

third party.

Yes

Dust Wipe Testing

Only Option Same as Proposed.

Dust wipe testing is required in instances where

dust wipe testing or clearance is required under

the proposed option.

No

Clearance Only

Option Same as Proposed.

Clearance is required in instances where dust

wipe testing or clearance is required under the

proposed option.

No

Table ES-2: Size Thresholds of the Options Included in Economic Analysis

Threshold (square feet)

Activity Event Type Low Proposed High

Trim/Molding/Cabinet Removal 6 40 80

Window / Door Frame Removal n/a n/a n/a

Painting w/ Scraping 6 60 120 Dust Wipe Testing Only

Painting w/ Heat Gun 6 6 60

Paint Removal w/ High-Speed Machines

a Both Dust Wipe Testing and 6 6 60

Clearance Plaster Removal w/ Destructive Means 6 6 60

a Under the 2008 LRRP rule at 40 CFR 745.85(a)(3)(ii), the use of machines that remove lead-based paint through high speed

operation such as sanding, grinding, power planing, needle gun, abrasive blasting, or sandblasting, is prohibited unless such

machines are used with HEPA exhaust control.

Number of Events

The proposed rule would affect approximately 1.6 million renovations per year. By comparison, the

LRRP program applies to 18.7 million renovations each year, of which 7.4 million use lead-safe work

practices (because they test positive for lead-based paint, and are conducted in compliance with the rule).

3

Table ES-3 indicates the estimated number of renovation events affected by the different options by type

of renovation and threshold size. In about 1.5 million renovations (96% of those affected by the proposed

rule), dust wipe testing would be required without a requirement to achieve clearance. The most common

single event activities covered by the rule are window or door frame removal, followed by trim, molding,

3 The number of events is estimated under a baseline scenario where the opt-out provision of the 2008 LRRP rule has

been eliminated, as was proposed in October 2009 (74 FR 55506).

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Economic Analysis for the LRRP Clearance Proposed Rule

Executive Summary ES-5

or cabinet removal. But the most common regulated activity overall involves multiple regulated activities

occurring during the course of a single job (e.g., a renovation with both window frame removal and trim

removal).

Table ES-3: Thousands of Regulated Events by Event Type and Optiona– First Year

Activity Event Type

Low

Threshold

Proposed

Threshold

High

Threshold

Heat gun, < 1000 degrees 4 4 <1

Window/door frame removal 484 514 545

Scraping 40 2 <1

Trim, molding, cabinet removal 687 437 207

Multiple activity eventsb607 572 449

Dust Wipe Testing

Only

Subtotal, dust wipe testing 1,822 1,528 1,201

High speed machines 4 4 2

Plaster demolition through destructive means 21 29 31

Multiple activity eventsb44 36 25

Both Dust Wipe

Testing and

Clearance

Subtotal, clearance events 69 69 58

Total, All Event Types 1,891 1,597 1,259

Totals may not add due to rounding.

a The third party sampling option, the dust wipe testing only option, and the clearance only option impact the same total

number of events as the proposed threshold option.

b Multiple event types occurring during the course of a single job (e.g., a renovation with both window frame removal and

trim removal). Because the probability of multiple-activity events varies with the size threshold, the number of events for

single-event activities is not consistent across size thresholds.

Figure ES-2 shows the distribution of events by event type for the proposed threshold.

Figure ES-2: Total First Year Events by Type - Proposed Threshold

Multiple activity events

with at least one

clearance event

2% of all clearance rule jobs

High speed machine

paint removal events only

< 1% of all clearance rule

jobs

Scraping events only

< 1%

Clearance

4%

Trim, molding, cabinet

removal events only

27%

Plaster demolition

through destructive

means events only

2% of all clearance rule jobs

Multiple activity dust testing

events [no clearance events]

36%

Heat gun events only

< 1%

Window/door frame

removal events only

32%

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Scraping events only

< 1%

Trim, molding, cabinet

removal events only

27%

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Economic Analysis for the LRRP Clearance Proposed Rule

Executive Summary ES-6

Renovations requiring clearance make up about 4% of the renovations affected by the proposed rule (and

1% of all renovations using lead-safe work practices under the LRRP program). Multiple activity events

(including combinations of clearance events and dust wipe testing only events) are the most common

activities requiring clearance, followed by the demolition or removal of plaster through destructive

means, and using machines that remove paint through high speed operations.

There are an estimated 1.9 million regulated events per year under the low threshold option and 1.3

million regulated events per year under the high threshold option. The distribution of event types under

these alternate options (in terms of the relative frequency of different single and multiple event activities)

is similar to the proposed threshold option. There are an estimated 1.6 million regulated events per year

under the third party sampling option, the dust wipe testing only option, and the clearance only option, the

same as under the proposed threshold option.

Costs of the Proposed Rule

Dust wipe testing costs are expected to vary according to the number of samples taken, which depend on

the number of rooms in the work area and whether or not the room is carpeted. For a typical one-room

renovation event, four samples would be required (window sill, window trough, workroom floor, and

adjacent room floor). For a renovation event where both the renovated room and the adjacent room are

carpeted, only two samples would be required (window sill and window trough). Each additional room

inside the work area will add two to three dust wipes depending on whether or not the room is carpeted

and whether or not there are windows in the work area. However samples are not required for more than

four rooms in a unit’s work area.

All entities that conduct renovations covered by the proposed Clearance Rule will have to use a trained

dust sampling technician to take dust samples and have them tested. (A trained dust sampling technician

is an individual who has successfully completed a dust sampling technician course accredited by EPA or

an EPA-authorized State or Tribal program.) Renovators can either hire a third-party dust sampling

technician or have themselves or one of their employees trained as a dust sampling technician. Which

approach they choose may depend on several factors, including the number of renovations they perform

each year covered by the proposed rule.

The average cost for a renovation firm to hire a third-party lead evaluation firm to take the dust wipe

samples, send them to a lab for testing, and provide a one-page report is estimated to be a fixed cost of

$158 and a variable cost of $26 per sample. Thus, the cost to hire a third party to take four dust samples,

send them to a lab for analysis, and provide a short report is estimated to be $262. Given that some

covered renovations take place in more than one room (so that more than four samples may be required,

depending on whether uncarpeted floors and windows are present), the average cost of the dust testing

requirement is nearly $300 per job if a third party dust sampling technician is used.

Firms performing multiple renovations a year where dust wipe testing is required can save money by

having the renovator or a worker trained as a dust sampling technician. This requires taking an eight hour

initial training course (and a four hour refresher course every five years thereafter), at an estimated

annualized cost of $146 per year. For renovators that perform multiple covered renovations per year, the

savings from using their own dust sampling technician are much greater than the annualized cost of the

dust sampling technician training. Dust testing for these samples will cost these renovators an average of

approximately $170 per job (including training costs), a savings of $130 per job compared to using a third

party dust sampling technician. The analysis assumes that over 233,000 renovators will choose to

become trained as dust sampling technicians so that they can collect samples for their own renovations.

The proposed rule does not require them to become trained, but many renovators may find it more

economical to do so rather than hiring a third party to take the samples.

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Executive Summary ES-7

The cost of dust wipe testing for a job will vary based on the number of surfaces that must be tested, and

whether the dust sampling is done in-house or by a third-party firm. Overall, typical costs are estimated

to vary from $120 to $340 per job. A typical renovator will have 3 to 38 jobs per year requiring dust wipe

sampling, with an average of 7 such jobs per year.

For clearance events (use of a high-speed paint removal machine or demolition or destructive removal of

over 6 sq. ft. of plaster), renovators would incur similar dust wipe testing costs, in terms of the cost per

test. Re-cleaning and re-sampling are only necessary for a subset of events in which a surface fails the

first round of clearance testing. In the event of a failed clearance test, only the component(s) that failed

the tests must be re-cleaned. For example, if the window sill sample failed clearance but the window

troughs and the floors passed, the window sill must be re-cleaned but the window troughs and the floors

do not need to be re-cleaned. These re-cleaning costs vary from job to job, depending on the number and

type of components that failed and the size of the space that must be cleaned. Overall, re-cleaning costs

are estimated to vary from $43 to up to $5,172 per job, although the costs for a typical job are expected to

be at the very low end of the range. (The high end of the range reflects a COF where 14 rooms are

renovated and where all floor, sill and trough samples fail two rounds of clearance testing and are recleaned twice. This is an overestimate, since the rule does not require a second re-cleaning or a third

round of testing.)

Table ES-4 summarizes the annualized work practice costs by event type for the three different threshold

options. This table does not include training costs for renovators who choose to become trained as a dust

sampling technician, since the training costs are not specific to individual event types.

Table ES-4: Total Incremental Annualized Work Practice Costs by Event Type (3

percent discount rate, million 2008$)

Activity Event Type

Low

Threshold

Proposed

Threshold

High

Threshold

Heat gun, < 1000 degrees <$1 $1 <$1

Window/door frame removal $70 $75 $79

Scraping $5 <$1 <$1

Trim, molding, cabinet removal $93 $59 $28

Multiple activity eventsa$99 $94 $75

Dust Wipe

Testing

Subtotal, dust wipe testing $268 $228 $182

High speed machines $1 $1 $1

Plaster demolition through destructive

means $4 $5 $6

Multiple activity eventsa$10 $9 $6

Dust Wipe

Testing and

Clearance

Subtotal, clearance events $15 $14 $12

Total, All Event Types $283 $242 $195

Totals may not add due to rounding.

a Multiple event types occurring during the course of a single job (e.g., a renovation with both window

frame removal and trim removal).

Table ES-5 shows the total costs (including both work practice costs and training costs) for all six

options. Costs are higher in the first year to reflect the renovators who choose to become trained as dust

sampling technicians in order to take their own dust wipe samples.

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Executive Summary ES-8

Table ES-5: Total Incremental Costs of Proposed LRRP Clearance Rule

(millions 2008$)

Annualized Total

Option Year 1 Year 2 3% 7%

Low Threshold $435 $321 $312 $336

Proposed Threshold $393 $279 $272 $293

High Threshold $343 $229 $224 $242

Third Party Sampling $451 $449 $431 $459

Dust Wipe Testing Only $388 $274 $268 $288

Clearance Only $492 $377 $367 $394

Benefits

A great deal of information on the numerous adverse health effects of lead is available from decades of

medical observation and scientific research. Inhaled or ingested lead is distributed throughout the body

and is toxic to many organ systems. As a result, its toxicity manifests itself in the form of impacts on

several organ systems. A reduction in lead exposure resulting from the rule would lead to a reduction in

these adverse health effects and the costs of treating them. Young children (from birth through age five)

are particularly sensitive to lead, which impairs a child’s neuropsychological development (frequently

measured by IQ change).

These cognitive and behavioral effects, discussed above, are strongly related to future productivity and

expected earnings. The estimated value of an IQ point is approximately $13,000, which represents the

present value of a loss in expected lifetime earnings due to a one point IQ drop. This estimated value of

an IQ point is limited to reduced income, and does not include other potential impacts such as additional

education costs for special and remedial education, and medical costs to treat very high levels of lead.

Investigating associations between lead exposure and behavior, mood, and social conduct of children has

been an emerging area of research. Early studies indicated linkages between lower-level lead toxicity and

behavioral problems (e.g., aggression, attentional problems, and hyperactivity) in children. Blood-lead

and tooth-lead levels have been associated with behavioral features of attention-deficit hyperactivity

disorder (ADHD), including distractibility, poor organization, lack of persistence in completing tasks, and

daydreaming, in various cohorts of children with a wide range of lead exposures. The relationship

between lead exposure and delinquent and criminal behavior also has been addressed in several

investigations. Studies linking attention deficits, aggressive and disruptive behaviors, and poor selfregulation with lead have raised the prospect that early exposure may result in an increased likelihood of

engaging in antisocial behaviors in later life. Elevated lead levels have been associated with several

measures of behavioral disturbance and delinquent behavior.

Epidemiologic studies have consistently demonstrated associations between lead exposure and enhanced

risk of deleterious cardiovascular outcomes, including increased blood pressure and increased

hypertension.

Both epidemiologic and toxicologic studies have shown that environmentally relevant levels of lead affect

many different organ systems. Neurotoxic effects in children and cardiovascular effects in adults are

among those best substantiated as occurring at blood-lead concentrations as low as 5 to 10 ug/dL (or

possibly lower); and these categories of effects are currently of greatest public health concern. Other

newly demonstrated immune and renal system effects among general population groups are also emerging

as low-level lead exposure effects of potential public health concern. It appears that some of these

effects, particularly changes in the levels of certain blood enzymes and in aspects of children's

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Executive Summary ES-9

neurobehavioral development, may occur at blood-lead levels so low as to be essentially without a

threshold.

The proposed LRRP Clearance Rule would require dust wipe testing after many of the renovation, repair,

and painting (RRP) activities regulated under the 2008 LRRP rule, and would require clearance after a

smaller subset of RRP activities. The clearance requirements of the proposed LRRP Clearance Rule are

expected to result in lower exposures to dust lead by reducing the amount of dust lead left behind after

RRP activities. Two types of benefits are expected to be realized from the proposed dust wipe testing

requirements. The first type is the direct benefits of the information to the owners and occupants, which

includes the value of the information on dust lead levels remaining in the renovation work area. For

building owners and occupants, this information is likely to improve their understanding and awareness of

dust lead hazards. It will also greatly improve their ability to make further risk management decisions.

This information is particularly critical where dust lead levels approach or exceed the regulatory hazard

standards. The second benefit expected to be realized from the proposed dust wipe testing requirements

stems from changed behavior on the part of renovation firms. EPA believes that dust wipe testing results

will also provide valuable feedback to renovation firms on how well they are cleaning up after

renovations. It is likely that the specific dust lead levels contained in dust wipe testing results will

increase renovation firm cleaning efficiency. Renovation firms will be incentivized to lower the dust lead

levels remaining after renovation jobs, even if the levels are at or near the regulatory standards. Because

proper cleanup plays such a vital role in the minimization of dust lead hazards created by renovations,

providing information on dust lead levels remaining after renovations to building owners and occupants

will serve as an incentive for firms to perform post-renovation cleaning efficiently and thoroughly,

reducing the amount of dust lead left behind after RRP.

The proposed rule will protect children and adults residing in target housing and attending a COF from

exposure to lead dust from renovations in a variety of situations. It will result in fewer homes being

purchased with pre-existing lead hazards. It is common for home owners to perform activities that disturb

paint before selling a house. The proposed rule decreases the likelihood of lead hazards being present

when new occupants move into the home. And the proposed rule will also benefit individuals visiting a

friend, relative, or caregiver’s house where a renovation has been performed.

The number of individuals residing in target housing and attending COFs with renovations affected under

the different options is shown in Table ES-6. The proposed rule would protect 8.4 million such

individuals per year, including 809,000 children under the age of 6 and 96,000 pregnant women. (This is

important because the transplacental transfer of lead in humans is well documented, and infants are

generally born with a lead body burden reflecting that of the mother.) The estimates are limited to

residents in target housing and children attending COFs, and do not include other groups such as

individuals who move into housing after a renovation has been performed, or who visit a friend or

relative’s house.

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Executive Summary ES-10

Table ES-6: Thousands of Occupants Per Year Protected Under Different Options

Option Activity Performed

Children

Under Age

6

Pregnant

Women

Other

Individuals Age

6 and Older Total

Dust Wipe Testing 855 103 7,930 8,888

Clearance 27 2 158 187

Low Threshold

Total 882 105 8,088 9,075

Dust Wipe Testing 782 94 7,294 8,170

Clearance 27 2 158 187 Proposed Threshold

Total 809 96 7,451 8,356

Dust Wipe Testing 682 81 6,377 7,140

High Threshold Clearance 24 2 130 156

Total 706 83 6,507 7,296

Dust Wipe Testing 782 94 7,294 8,170

Third Party Sampling Clearance 27 2 158 187

Total 809 96 7,451 8,356

Dust Wipe Testing Only Dust Wipe Testing 809 96 7,451 8,356

Clearance Only Clearance 809 96 7,451 8,356

Small Entity Impacts

The Regulatory Flexibility Act (RFA) of 1980, amended by the Small Business Regulatory Enforcement

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

including businesses, nonprofit organizations, and governments. The vast majority of entities in the

industries affected by the proposed rule are small.

Two factors are evaluated in analyzing the rule’s impacts on small entities, (1) the number of firms that

would experience the impact, and (2) the size of the impact. Average annual compliance costs as a

percentage of average annual revenues are used to assess the potential average impact of the rule on small

businesses and small governments. This ratio is a good measure of entities’ ability to afford the costs

attributable to a regulatory requirement, because comparing compliance costs to revenues provides a

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

of economic activity. Where regulatory costs represent a small fraction of a typical entity’s revenues, the

financial impacts of the regulation on such entities may be considered as not significant. For non-profit

organizations, impacts are measured by comparing rule costs to the organization’s annual expenditures.

When expenditure data were not available, however, revenue information was used as a proxy for

expenditures. It is appropriate to calculate the impact ratios using annualized costs, because these costs

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

Table ES-7 presents the total number of small governments, non-profit organizations, and small for-profit

businesses, and the average cost-to-revenue ratios for each category. It is estimated that a total of

approximately 203,000 small entities would be affected by the program, including nearly 203,000 small

businesses with average impacts of 0.5 percent, about 200 small non-profits with average impacts of 0.1

percent, and over 100 small governments with average impacts of 0.004 percent. All of the small entity

impact calculations assume that the small entities absorb all of the rule’s costs, and that none of the costs

are passed through to their customers.

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Executive Summary ES-11

Table ES-7: Aggregate Small Entity Impacts of the Proposed Rule

Total Number of Small

Entities Affected (thousands)

Average Impacts,

All Small Entities

Small Governments 0.1 0.004%

Non-Profit Organizations 0.2 0.1%

Small For-Profit Businesses 202.7 0.5%

Total 203 0.5%

The cost of the proposed rule to a typical small entity is estimated to average $1,200 per year, but will

vary depending on the number of renovation, repair, and painting events undertaken by a small entity in

the industry sector involved. As shown in Table ES-8, the average cost impact ranges from about 0.004

percent to 1.1 percent of revenues, depending on the industry sector.

Table ES-9 provides additional information on potential impacts on small residential construction

establishments. Some of the small entities subject to the rule have employees while others are nonemployers. The non-employers typically perform fewer jobs than firms with employees, and thus have

lower work practice compliance costs. However, they also have lower average revenues than entities

with employees, so their impacts (measured as costs divided by revenues) can be higher. Impact

estimates for non-employers should be interpreted with caution, as some non-employers may have issues

related to understatement of income, which would tend to exaggerate the average impact ratio for this

class of small entities. As shown in Table ES-9, there are 151,000 non-employer renovation contractors

estimated to be affected by the removal of the opt-out provision. The average cost to these contractors is

estimated to be $700 each. This represents 0.7% to 2.6% of reported revenues, depending on the industry

sector.

Table ES-8: Typical-Year Number of Small Entities with RRP Events (Proposed Option)

Description Entity Type Number of

Small

Entities

(thousands)

Average

Cost-Impact

Ratio

Residential remodelers Business 68.4 0.5%

Finish carpentry contractors Business 48.6 0.8%

Tile and terrazzo contractors Business 6.9 0.7%

Plumbing and HVAC contractors Business 23.4 0.4%

Painting and wall covering contractors Business 27.0 1.1%

Electrical contractors Business 16.6 0.5%

Drywall and insulation contractors Business 11.4 0.5%

Public School Districts Government 0.1 0.004%

Private Schools Non-Profit 0.1 0.08%

Daycare Centers Non-Profit 0.1 0.2%

Non-Residential Landlords Business 0.1 0.4%

Non-Residential Contractors (working in public or

commercial building COFs)

Business

0.3 0.4%

Total 203 0.5%

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Executive Summary ES-12

Table ES-9: Cost-to-Revenue Ratios: Small Residential Construction Establishments

(Proposed Option)

Category NAICS Industry Description

Number of

Small

Entities

(thousands)

Avg. CostImpact

Ratio

236118 Residential remodelers 48 1.9%

238350 Finish carpentry contractors 41 2.1%

238340 Tile and terrazzo contractors 6 1.7%

238220 Plumbing and HVAC contractors 13 1.1%

238320 Painting and wall covering contractors 23 2.6%

238210 Electrical contractors 10 1.6%

238310 Drywall and insulation contractors 10 0.7%

Non-Employers

Total, Small Construction Establishments 151 1.7%

236118 Residential remodelers 20 0.3%

238350 Finish carpentry contractors 8 0.4%

238340 Tile and terrazzo contractors 1 0.4%

238220 Plumbing and HVAC contractors 10 0.3%

238320 Painting and wall covering contractors 4 0.6%

238210 Electrical contractors 6 0.4%

238310 Drywall and insulation contractors 2 0.4%

Employers

Total, Small Construction Establishments 52 0.4%

236118 Residential remodelers 68 0.5%

238350 Finish carpentry contractors 49 0.8%

238340 Tile and terrazzo contractors 7 0.7%

238220 Plumbing and HVAC contractors 23 0.4%

238320 Painting and wall covering contractors 27 1.1%

238210 Electrical contractors 17 0.5%

238310 Drywall and insulation contractors 11 0.5%

Employers and

Non-Employers

Combined

Total, Small Construction Establishments 202 0.5%

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Economic Analysis for the LRRP Clearance Proposed Rule

Chapter 1 1-1

1. Introduction

This report presents an economic analysis of alternative regulatory options for revising the lead,

renovation, repair and painting (LRRP) program regulations for target housing and child occupied

facilities (COFs). The LRRP rule for target housing and COFs was promulgated in 2008 (73 FR 21692)

and is codified in Part 745 of Title 40 of the Code of Federal Regulations (CFR). The rule was

promulgated under the authority of §402(c) of the Toxic Substances Control Act (TSCA). Section IV of

TSCA was established by the Residential Lead-Based Paint Hazard Reduction Act of 1992, also known

as Title X of the Housing and Community Development Act of 1992, Public Law 102-550.

The existing LRRP regulations require entities that perform renovation, repair and painting work for

compensation in buildings covered by the rule to become certified by EPA, ensure that their employees

are trained as either renovators or workers, and use lead-safe work practices when disturbing lead-based

paint.

Past use of lead-based paint has resulted in contamination that continues to pose human health hazards.

While intact lead-based paint is not likely to contribute to such hazards, the deterioration of a structure

over time or acute environmental stresses, such as are commonly present during renovation activities, has

been found to create lead hazards. Since many buildings constructed before 1978 have lead-based paint,

it is likely that renovation activities in pre-1978 buildings will contribute to lead hazards unless

appropriate containment and clean-up practices are employed.

The proposed LRRP Clearance Rule includes the following changes to the LRRP program: (1) a

requirement to perform dust wipe testing for a subset of renovation activities, and (2) a requirement to

perform dust wipe testing and achieve clearance for a second subset of renovation activities where the

quantity and characteristics of the dust make it hard to clean up.

1.1 Purpose of the LRRP Rule Revisions

The LRRP rule requires certification of entities that perform renovation, repair and/or painting in

buildings covered by the regulations. This includes construction contractors (including sole practitioners)

as well as landlords and other building owners (such as school districts) that may perform RRP activities

using their own staff. It does not, however, cover renovation, repair and painting (RRP) work performed

by homeowners on their own homes. The certified entity must ensure that all persons performing RRP

activities on behalf of the entity in buildings covered by the rule are either renovators who have received

formal training in EPA-approved work practices from an EPA-accredited course or workers who have

received on-the-job training in these approved work practices. In addition, the rule requires the use of

these approved work practices to ensure that proper cleanup has occurred.

The proposed rule will require renovation firms to perform dust wipe testing after certain types of

renovation activities and to provide copies of the test results to the owners and occupants of the renovated

buildings. These requirements will serve to inform the owners and occupants of the remaining postrenovation lead-dust levels. In instances when clearance must be achieved, owners and occupants would

be provided with the information that the renovated areas met lead-dust level standards after cleaning.

The increased information provided to owners and occupants of renovated buildings will further protect

individuals (including children under age 6 and pregnant women), who visit, move into, or live adjacent

to target housing or COFs renovated under the existing LRRP requirements, from exposure to lead

hazards due to renovation activities.

1.2 Goal of the Economic Analysis

The purpose of this report is to analyze various options for the LRRP rulemaking revisions. The report

addresses the requirements for economic analysis of Executive Order 12866 – Regulatory Planning and

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Chapter 1 1-2

Review; the Regulatory Flexibility Act (RFA) and the Small Business Regulatory Enforcement Fairness

Act (SBRFA); Executive Order 12898 – Federal Actions to Address Environmental Justice in Minority

Populations and Low-Income Populations; Executive Order 13045 – Protection of Children from

Environmental Health Risks and Safety Risks; the Unfunded Mandates Reform Act; Executive Order

12875 – Enhancing the Intergovernmental Partnership; and the Paperwork Reduction Act (PRA).

This economic analysis considers various regulatory options. The three primary options considered in

this analysis only differ in the size thresholds that trigger the rule’s requirements when performing certain

renovation activities. Table 1-1 summarizes the options considered in this analysis; they are described in

more detail below.

1. Low Threshold Option

 All event types requiring dust wipe testing where the amount of lead-based paint

disturbed is larger than 6 square feet.

 Clearance is required for:

- high-speed machine removal of paint larger than 6 square feet, and

- plaster removal using destructive means, larger than 6 square feet.

2. Proposed Threshold Option

 Dust wipe testing is required for:

- cabinet and trim events larger than 40 square feet,

- scraping of paint larger than 60 square feet,

- heat gun removal of more than 6 square feet

- Window frame or door frame removal events

 Clearance is required for:

- high-speed machine removal of paint larger than 6 square feet, and

- plaster removal using destructive means, larger than 6 square feet.

3. High Threshold Option

 Dust wipe testing is required for:

- cabinet and trim events larger than 80 square feet,

- scraping or heat gun removal of paint larger than 120 square feet, and

- window frame or door frame removal events.

 Clearance is required for:

- high-speed machine removal of paint larger than 60 square feet, and

- plaster removal using destructive means, larger than 60 square feet.

There are three alternative options in addition to the three primary options: (1) an option where third party

dust wipe testing and clearance is required, (2) an option where dust wipe testing is required in lieu of the

clearance required under the proposed option, (3) an option where clearance is required in lieu of the dust

wipe testing required under the proposed option.

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Chapter 1 1-3

Table 1-1: Options Included in Economic Analysis

Option Size Threshold Dust Wipe Testing and Clearance Third Party

Requirement

Low Threshold

Option

Size thresholds are

lower or equal to

proposed rule

No

Proposed Rule Size thresholds are

as proposed No

High Threshold

Option

Size thresholds are

higher or equal to

proposed rule

Dust wipe testing is required for:

1. cabinet and trim events

2. scraping of paint

3. heat gun removal of paint

4. Window frame or door frame removal

events

Clearance is required for:

1. high-speed machine removal of paint

2. plaster removal using destructive means

No

Third Party

Sampling Option Same as Proposed.

Dust wipe testing and clearance are required

in the same instances as proposed but dust

wipe sampling must be performed by a third

party.

Yes

Dust Wipe

Testing Only

Option

Same as Proposed.

Dust wipe testing is required in instances

where dust wipe testing or clearance is

required under the proposed option.

No

Clearance Only

Option Same as Proposed.

Clearance is required in instances where dust

wipe testing or clearance is required under

the proposed option.

No

1.3 Organization of this Report

Chapter 2 profiles the RRP industry, as well as non-profit and governmental suppliers of childcare

including family daycare providers. It examines the supply of and demand for renovation, remodeling and

painting services. Using data from a variety of sources, including the U.S. Economic Census, the chapter

discusses the size of the RRP industry and characteristics of its firms, as well as the organizational

structure and competitiveness of the industry. The demand for RRP services is characterized and the

factors that affect demand are discussed. Other affected industries (e.g. training providers, property

owners and managers) are also profiled in this chapter.

Chapter 3 characterizes the lead contamination problem to be addressed under the proposed rule. It

discusses how incomplete information and external costs have resulted in inefficient levels of lead

contamination resulting from renovation activity, and introduces regulation as a reasonable solution for

these market failures. The chapter also reviews state and local regulations that affect RRP activities and

demonstrates that these are not sufficient to address the problem.

Chapter 4 describes in detail the methods used to calculate costs of the various regulatory options

considered. It describes the data sources used and the methodology for estimating the two general

categories of costs incurred under the proposed rule: dust sampling technician training costs, and dust

wipe testing and clearance costs. The last section of the chapter estimates the costs of each option over a

50-year period and presents annualized costs at both 3 percent and 7 percent.

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Chapter 1 1-4

Chapter 5 describes the benefits of the proposed rule in qualitative terms, including potential benefits to

adults. Estimates of the number of children and adults who may experience reduced lead exposures due

to the dust wipe testing and clearance requirements are also presented.

Chapter 6 presents findings of distributional analyses relevant to specific rule-making requirements,

including small business impacts, environmental justice, protection of children and unfunded mandates.

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Chapter 2 2-1

2. Lead, Renovation, Repair, and Painting Industry Profile

The LRRP rule for target housing and child occupied facilities (COFs) was promulgated in 2008 (73 FR

21692) and is codified in Part 745 of Title 40 of the Code of Federal Regulations (CFR). The rule was

promulgated under the authority of §402(c) of the Toxic Substances Control Act (TSCA). Section IV of

TSCA was established by the Residential Lead-Based Paint Hazard Reduction Act of 1992, also known

as Title X of the Housing and Community Development Act of 1992, Public Law 102-550.

The existing LRRP regulations apply to entities that perform renovation, repair and painting work for

compensation in target housing or child occupied facilities, including building owners or managers who

use their own staff to conduct RRP activities. These entities must become certified by EPA, ensure that

their employees are trained as either renovators or workers, and use lead-safe work practices when

disturbing lead-based paint.

On October 28, 2009, EPA issued a proposed rule to expand the coverage of the 2008 Lead Renovation,

Repair and Painting Rule. The new rule proposed to eliminate a provision that exempted some housing

from the rule’s requirement that contractors be trained and certified and use lead-safe work practices

when renovating, repairing or painting a pre-1978 home.

The proposed LRRP Clearance Rule includes additional revisions to the LRRP program, including: (1) a

requirement for dust wipe testing for a subset of renovation activities, and (2) a requirement for dust wipe

testing and clearance for a subset of renovation activities in which the quantity and characteristics of the

dust make it difficult to clean up.

Target housing is defined in section 401 of the Toxic Substances Control Act (TSCA) as any housing

constructed before 1978, except housing for the elderly or persons with disabilities (unless any child

under age 6 resides or is expected to reside in such housing) or any 0-bedroom dwelling.

A COF is defined under the rule in Title 40 of the Code of Federal Regulations (CFR) §745.83, as:

Child-occupied facility means a building, or portion of a building, constructed prior to 1978,

visited regularly by the same child, under 6 years of age, on at least two different days within any

week (Sunday through Saturday period), provided that each day’s visit lasts at least 3 hours and

the combined weekly visits last at least 6 hours, and the combined annual visits last at least 60

hours. Child-occupied facilities may include, but are not limited to, day care centers, preschools

and kindergarten classrooms. Child-occupied facilities may be located in target housing or in

public and commercial buildings. With respect to common areas in public and commercial

buildings that contain child-occupied facilities, the child-occupied facility encompasses only

those common areas that are routinely used by children under age 6, such as restrooms and

cafeterias. Common areas that children under age 6 only pass through, such as hallways,

stairways, and garages are not included. In addition, for public and commercial buildings that

contain child-occupied facilities, the child-occupied facility encompasses only the exterior sides

of the building that are immediately adjacent to the child-occupied facility or the common areas

routinely used by children under age 6.

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Chapter 2 2-2

The term renovation is defined in 40 CFR §745.83 to encompass a wide variety of construction activities:

Renovation means the modification of any existing structure, or portion thereof, that results in the

disturbance of painted surfaces, unless that activity is performed as part of an abatement as

defined by this part (40 CFR § 745.223). The term renovation includes (but is not limited to): the

removal, modification or repair of painted surfaces or painted components (e.g., modification of

painted doors, surface restoration, window repair, surface preparation activity (such as sanding,

scraping, or other such activities that may generate paint dust)); the removal of building

components (e.g., walls, ceilings, plumbing, windows); weatherization projects (e.g., cutting

holes in painted surfaces to install blown-in insulation or to gain access to attics, planing

thresholds to install weather-stripping), and interim controls that disturb painted surfaces. A

renovation performed for the purpose of converting a building, or part of a building, into target

housing or a child-occupied facility is a renovation under this subpart.

Thus, renovation includes repair work as well as painting work involving sanding, scraping, or other paint

removal. Renovation activities are conducted without the intent of removing lead, but may disturb it in

the process. Lead abatement activities, on the other hand, are conducted with the intent to remove leadbased paint or otherwise permanently eliminate a lead-based paint hazard. Depending on the reason they

are undertaken, many activities, such as replacing windows, can be either renovation or abatement.

Because the rule will address renovation, rather than abatement activity, this profile characterizes the

renovation industry as opposed to the abatement services industry.

The industry profile is categorized into eight sections. Section 2.1 discusses the supply of contractorprovided renovation services. Section 2.2 presents information on the numbers and types of child care

facilities and schools. Section 2.3 presents information on the number and sizes of non-residential

property owners and managers likely to be affected by the rule. Section 2.4 focuses on the demand-side

of renovation by identifying the quantity of renovation activities performed. Section 2.1 discusses the

overall market organization for the renovation industry. Section 2.6 describes the residential property

owner and manager industry. Section 2.7 discusses training providers. Section 2.8 provides an overview

of the structures that would be affected by the revisions to the LRRP rule.

2.1 Contractors that Supply Renovation Services

Data from the U.S. Economic Census were used to identify the North American Industry Classification

System (NAICS) industry groups that may provide renovation, repair and painting work (U.S. Census

Bureau 2004a). An establishment is assigned to a NAICS group based on the activities from which it

derives the greatest share of its revenues. These activities may or may not make up the majority of work

(i.e. labor hours) performed by the establishment, which may also be involved in a variety of other related

(or unrelated) lines of work. The analysis identified 8 NAICS codes that are likely to include the vast

majority of construction-related establishments that will be affected by the rule. Affected industry groups

include two building construction sectors (NAICS 236118 – Residential Remodelers; and NAICS 236220

– Commercial and Institutional Building Construction) and six specialty trade contractor sectors.

The number of contracting establishments affected is also discussed in Chapter 4. This profile examines

the financial and employment characteristics of construction establishments likely to provide renovation

work in child-occupied facilities.

NAICS sectors likely to perform projects regulated under the LRRP rule, as well as examples of the work

they perform, are presented in Table 2-1.

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Chapter 2 2-3

Table 2-1: Contractor Sectors likely to be affected by the rule

2002 NAICS Examples of Work Performed

236118 - Residential Remodelers  Addition, alteration and renovation of single-family

homes

 Addition, alteration and renovation of multifamily

buildings

 Home improvement (e.g., adding on, remodeling,

renovating)

236220 - Commercial Building

Construction

 Addition, alteration, maintenance and repair of

commercial and institutional buildings

 Commercial and Institutional building general

contractors

238210 - Electrical Contractors  Electrical wiring contractors

 Lighting system installation

 Electrical power control panel and outlet installation

238220 – Plumbing and HVAC

Contractors

 Heating equipment installation

 Plumbing fixture installation

 Plumbing and heating contractors

238310 – Drywall and Insulation

Contractors

 Panel or rigid board insulation installation

 Mineral wool insulation installation

 Plastering (i.e., ornamental, plain) contractors

238320 – Painting and Wall Covering

Contractors

 House painting

 Paint and Wallpaper Stripping

 Paperhanging and removal contractors

238340 – Tile and Terrazzo Contractors  Ceramic tile installation

 Mantel, marble or stone, installation

 Mosaic work

238350 – Finish Carpentry Contractors  Door and window, prefabricated, installation

 Millwork installation

 Paneling installation

Source U.S. Census Bureau 2004a

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Chapter 2 2-4

2.1.1 Number of Establishments with Employees

The U.S. Economic Census tracks businesses with paid employees (employer establishments) and nonemployer establishments (self-employed contractors) separately.1

This discussion deals with employer

establishments only; non-employers are addressed in the next section.

Table 2-2 presents both the number of establishments and the number of employees in each NAICS group

of interest. The number of establishments “includes all establishments that were in business at any time

during the year are included. Construction establishments that were inactive or idle for the entire year

were not included” (U.S. Census Bureau 2006a). Table 2-2 also presents the average per-establishment

employment numbers by NAICS code. The average employment numbers are small for all affected

sectors. Overall, Commercial Building Construction contractors have the largest number of employees

per establishment (19.2 people), while Residential Remodelers have the smallest (3.9 people).

Table 2-2: Number of Employer Establishments and Employees by NAICS Code

NAICS Industry Establishments Number of Employees Average Size

236118 Residential Remodelers 82,750 320,208 3.9

236220 Commercial building

construction 37,208 715,896 19.2

238210 Electrical contractors 62,586 771,184 12.3

238220 Plumbing and HVAC

contractors 87,501 974,368 11.1

238310 Drywall and insulation

contractors 19,598 311,077 15.9

238320 Painting and wall covering

contractors 38,943 234,562 6.0

238340 Tile and terrazzo

contractors 8,950 60,001 6.7

238350 Finish Carpentry

contractors 35,087 179,476 5.1

Total, All sectors 372,623 3,566,772 9.6

Source U.S. Census Bureau 2005c

Table 2-3 presents the total number of employees and the number of construction workers in each

identified industry. The number of employees “includes all full-time and part-time individuals on the

payrolls of construction establishments during any part of the pay period which included the 12th of

March, May, August, and November” (U.S. Census Bureau 2005m). The number of construction

workers “includes all payroll workers (up through the working supervisory level) directly engaged in

construction operations, such as painters, carpenters, plumbers, and electricians... journeymen,

mechanics...truck drivers and helpers.” Non-construction employees include “payroll employees in

executive, purchasing, accounting, ...and routine office functions” (U.S. Census Bureau 2005m).

Because construction workers form the vast majority of the people who require training under the rule,

their role in the composition of each sector’s labor force provides an indication of the extent to which

each sector will be affected by the regulations.

In total, about 3.6 million people work for the 372,623 establishments in the potentially affected

industries. About 74 percent of these employees are construction workers. The affected sectors differ in

terms of the composition of their labor force. For example, construction workers make up 84 percent of

1 Data at the firm level were not available for these NAICS groups when the analysis was performed.

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employees in the Drywall and Insulation contractor sector. In the Residential Remodelers sector,

however, construction workers make up only 65 percent of the labor force (U.S. Census Bureau 2005c).

2.1.2 Number of Non-Employer Establishments

As mentioned above, the U.S. Economic Census tracks non-employer establishments separately from

establishments with employees. Data on the number of non-employer establishments were available from

the U.S. Small Business Administration. A non-employer firm “is defined as one that has no paid

employees, has annual business receipts of $1,000 or more ($1 or more in the construction industries),

and is subject to federal income taxes” (U.S. Small Business Administration 2006a). Essentially, nonemployers are self-employed contractors. Because little financial and operational data is available for

non-employers, the vast majority of this profile focuses on establishments with employees. This

subsection discusses the number of non-employers in the affected industry sectors and the receipts of

these establishments.

The U.S. Small Business Administration did not provide data on the number or revenues of non-employer

establishments in each of the 6-digit level NAICS industries addressed in this profile. Data on the

number of such establishments was available for Plumbing and HVAC contractors (NAICS 238220) and

Electrical contractors (NAICS 238210) only; for the remaining industries, data was provided at the more

general 4-digit NAICS level. In total, there are over 1 million self-employed contractors.

To estimate the number of non-employer establishments in each of the 6-digit sectors, it was assumed that

the distribution of non-employer establishments in each 4-digit NAICS code is the same as the

distribution of establishments with payroll in the same 4-digit group. Similarly, to estimate the revenues

of these establishments, it was assumed that the distribution of receipts in each 4-digit NAICS code is the

same as the distribution of revenues of payroll establishments in the same 4-digit industry.

Table 2-4 presents the estimated number and revenues of non-employer establishments in each of the 8

sectors affected by the rule.

Table 2-3: Number of Employer Establishments, Total Employees and Employees

involved in Construction

NAICS Description

Total

Number of

Employees

Number of

Construction

Workers

Construction

Workers as Percent

of Total Employees

236118 Residential Remodelers 320,208 207,637 65%

236220 Commercial Building Construction 715,896 478,923 67%

238210 Electrical Contractors 771,184 606,403 79%

238220 Plumbing and HVAC Contractors 974,368 712,452 73%

238310 Drywall and Insulation Contractors 311,077 261,239 84%

238320 Painting and Wall Covering Contractors 234,562 184,328 79%

238340 Tile and Terrazzo Contractors 60,001 44,729 75%

238350 Finish Carpentry Contractors 179,476 129,888 72%

Total 3,566,772 2,625,599 74%

Sources U.S. Census Bureau 2005c

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Table 2-4: Number and Annual Revenues of Non-Employer Establishments in Affected

Sectors

NAICS Description

Number of Non-Employer

Establishments

Revenues of NonEmployer

Establishments

(000)

236118 Residential Remodelers 194,182 $6,187,917

236220 Commercial Building construction 74,255 $4,784,817

238210 Electrical contractors 102,219 $3,834,347

238220 Plumbing and HVAC contractors 110,183 $5,920,986

238310 Drywall and Insulation contractors 103,398 $8,798,899

238320 Painting and Wall Covering contractors 205,462 $4,823,217

238340 Tile and Terrazzo contractors 47,220 $1,684,174

238350 Finish Carpentry contractors 185,118 $5,254,955

Sources U.S. Census Bureau 2005h, U.S. Census Bureau 2004q, U.S. Census Bureau 2005i

2.1.3 Financial Profile

In this section, Census data is used to examine key financial indicators for the renovation industry. The

indicators include net value of construction (value of construction less value of construction

subcontracted out to others) and labor costs. Net value of construction work is used instead of the total

value of construction work because it is a measure of the work actually performed by the establishment.

Table 2-5 presents the average per establishment net value of construction work (NVCW) for each

industry sector. The table also presents labor costs as a percent of the net value of construction for each

of the affected NAICS codes.

Table 2-5 shows the wide range of values of construction work per establishment across all NAICS codes

of interest. The average establishment in the Residential Remodeler industry (NAICS 236118) has the

smallest net value of construction work ($370,000), followed by the Finish Carpentry contractors industry

Table 2-5: Financial Summary for Contractor Sectors Affected by the rule

2002

NAICS

code Industry Name

Annual Net

Value of

Construction

Work (000)

Number of

Establishments

Net Value of

Construction

Work per

Establishment

(000)

Total Payroll

(000)

Payroll as %

of Net Values

of

Construction

Work

236118 Residential Remodelers $30,627,850 82,750 $370 $8,703,503 28

236220 Commercial Building

construction $108,229,283 37,208 $2,909 $29,210,092 27

238210 Electrical contractors $77,671,846 62,586 $1,241 $29,324,486 38

238220 Plumbing and HVAC

contractors $105,323,163 87,501 $1,204 $35,942,262 34

238310 Drywall and Insulation

contractors $27,046,301 19,598 $1,380 $9,766,997 36

238320 Painting and wall covering

contractors $15,316,726 38,943 $393 $6,005,447 39

238340 Tile and Terrazzo

contractors $5,639,641 8,950 $630 $1,834,890 33

238350 Finish Carpentry

contractors $15,640,544 35,087 $446 $4,711,739 30

Total, all industries $385,495,354 372,623 $8,573 $125,499,416 33

Source U.S. Census Bureau 2005c

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($446,000). Meanwhile, the average establishment in the Commercial Building Construction industry

(NAICS 236220) has the largest net value of construction value ($2,909,000), with the Drywall and

Insulation contractors industry netting the second largest value ($1,380,000). It should come as no

surprise that the Commercial Building Construction industry’s net value of construction is so much larger

than the Residential Remodeler industry’s net value of construction work given that commercial building

construction projects tend to be substantially larger in scope and size than residential remodeling projects.

As demonstrated in Table 2-5, while labor constitutes about 33% of net value of construction for all the

industry sectors, the composition varies across industry sectors. The Painting and Wall Covering

contractor (NAICS 238220) industry is most dependent on labor, with an overall labor cost to net value of

construction ratio of 39 percent. The Commercial Building Construction industry, with an overall labor

cost to net value of construction work ratio of 27 percent, is the least dependent of the 12 sectors (U.S.

Census Bureau 2005c). It is worth mentioning that labor (as measured by payroll) is a relatively small

percentage (27% to 39%) of total net value, reflecting the fact that a large percent of revenues go to

covering the cost of materials and profit.

2.1.3.1 Establishment Size by Revenue Bracket

The Small Business Administration (SBA) defines a small business in both the Residential Remodeler

and Commercial Building Construction industries as one that has revenues of $33.5 million dollars a year

or less. The small business definition for the ten specialty contractor industries is $14 million per year

(U.S. Small Business Administration 2008). The SBA size standards apply to firms rather than

establishments; at the time the analysis was performed, revenue data in the 2002 Economic Census was

only available at the establishment level. Since a firm may consist of one establishment, a few

establishments or even a very large number of establishments, by using establishment rather than firm

data, this analysis overestimates the number of small businesses in the affected industry.

The remainder of this section examines the number of establishments, number of employees, net value of

construction work and value of business done2distributed by establishment revenue bracket. These data

were available from the 2002 Economic Census at the NAICS code level only. Establishments were

classified into two revenue categories based on the total value of business done – those with revenues less

that $10 million and those with revenues greater than $10 million. Because the Census groups all

establishments with revenues of $10 million or more into one revenue bracket, it is not possible to

determine what percentage of Residential Remodeler nor Commercial Building Construction

establishments have revenues of less than $33.5 million. Note, however, that nearly 100 percent of

Residential Remodeler establishments have revenues of less than $10 million per year. The same cannot

be said for Commercial Building Construction establishments, as 12 percent have revenues greater than

$10 million per year. The percent of establishments, employees and net value of construction contributed

by establishments in each revenue bracket is presented in Table 2-6.

2 Value of business done is defined by the U.S. Census Bureau as including “the sum of value of construction work

and other business receipts. Value of business done is the sum of receipts, billings, or sales from establishments of

construction business activities plus receipts from other business activities” (U.S. Census Bureau 2004d).

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Table 2-6: Small and Large Establishments as Percent of Industry

NAICS NAICS

Percent of

Establishments

Percent of

Employees

Percent of Net

Value of

Construction

Percent of Value

of Business done

236118 Residential Remodelers

236118 Revenues < $10 million 100% 95% 92% 91%

236118 Revenues > $10 million 0% 5% 8% 9%

236220 Commercial Building Contractors

236220 Revenues < $10 million 88% 41% 30% 24%

236220 Revenues > $10 million 12% 59% 70% 76%

238210 Electrical Contractors

238210 Revenues < $10 million 98% 68% 61% 60%

238210 Revenues > $10 million 2% 32% 39% 40%

238220 Plumbing and HVAC Contractors

238220 Revenues < $10 million 98% 70% 63% 61%

238220 Revenues > $10 million 2% 30% 37% 39%

238310 Drywall and Insulation Contractors

238310 Revenues < $10 million 97% 64% 60% 60%

238310 Revenues > $10 million 3% 36% 40% 40%

238320 Painting and Wall Covering Contractors

238320 Revenues < $10 million 100% 92% 88% 88%

238320 Revenues > $10 million 0% 8% 12% 12%

238340 Tile and Terazzo Contractors

238340 Revenues < $10 million 100% 91% 86% 86%

238340 Revenues > $10 million 0% 9% 14% 14%

238350 Finish Carpentry Contractors

238350 Revenues < $10 million 100% 86% 84% 83%

238350 Revenues > $10 million 0% 14% 16% 17%

Total

Total Revenues < $10 million 98% 68% 49% 58%

Total Revenues > $10 million 2% 32% 51% 42%

100 percent = establishments in this revenue category make up over 99.5 percent, but less than

100 percent of establishments in the industry.

Source U.S. Census Bureau 2004c,d,e,f,g,h,i,j,k,l,m; U.S. Census Bureau 2005m

The distribution of the number of establishments for all eight NAICS codes is greatly skewed toward

smaller establishments. In four out of eight industry sectors, over 99.5 percent of establishments have

revenues below $10 million. For the remaining sectors, establishments with revenues greater than $10

million make up less than 5 percent of establishments in any sector (with the exception of the Commercial

Building Construction industry where 12% of establishments earn more than $10 million in revenues3).

Thus, about 98 percent of all establishments in the affected industries have revenues well below the SBA

definition of small business.

Establishments with revenues of less than $10 million account for between 41 and 95 percent of total

employment for each sector, and about 68 percent of employment overall. The distribution of the net

3 Once again, this difference arises because of the larger size of a majority of Commercial building construction

projects. Regardless, if only 12% earn revenues greater than $10 million, it can easily be assumed that a much

smaller percentage of establishments in this industry earn revenues greater than the SBA cutoff of $33.5

million.

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value of construction work and the total value of business done is skewed toward smaller establishments

in a manner similar to the distribution of employees. Establishments with revenues of less than $10

million account for between 30 and 92 percent of the net value of construction work and between 24 and

91 percent of the total value of business done in each sector. It is worth mentioning that if the

Commercial Building Construction industry is removed, the lows in the previously cited categories jump

to 55 percent. Overall (across all industry sectors) small businesses contribute about 60 percent of the net

value of construction work and 60 percent of the total value of business (U.S. Census Bureau

2004c,d,e,f,g,h,i,j,k,l,m; U.S. Census Bureau 2005m).

2.1.3.2 Labor and Material Costs as a Percentage of Total Value of Business Done

In order to better understand the potential impacts of the rule on the affected industries, and particularly

on small businesses, it is important to observe whether establishment costs as a percentage of the total

establishments’ total revenues differ for small and large establishments. Figure 2-1 examines labor and

material costs, as well as the cost of construction work subcontracted out as a percentage of the total value

of business done for the twelve affected sectors. While the rule will increase the cost of material slightly,

the major impact will be on labor costs, including the training of staff. Each of the sectors was broken

down into two size categories by revenue bracket: less than $10 million and $10 million and more. The

cost of labor, of materials, and of construction work subcontracted out was summed across the 12 industry

sectors for large and for small establishments. These values were then compared to their total value of

business.

Labor costs, material costs, and the cost of construction work subcontracted out as a percentage of total

value of business done are presented in Figure 2-1. Regardless of size of establishments, material costs

tend to be a slightly larger percentage of total revenues than do labor costs. Labor costs make up about 25

percent of revenues for small establishments and about 16 percent for large establishments. Based on

Census data, large establishments subcontract out a much larger percentage of their work than do small

businesses.

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Figure 2-1: Labor and Material Costs as % of Total Value of Business Done

Labor Cost as %of

Total Value of

Business Done

M aterial Costs as %of

Total Value of

Business Done

Cost of Construction

Work subcontracted

out as %of Total Value

of Business Done

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

Type of Cost

Establishments with value of

Business Done of: < $10 million

Establishments with Value of

Business Done of: $10 million+

Source U.S. Census Bureau 2005a

2.2 Child Care and Schools: Child Occupied Facilities

For the purposes of analysis, COFs are divided into the following categories

4

:

 Kindergartens and Pre-Kindergartens in Schools: Located in public and private schools;

 Daycare centers: Organized (licensed) facilities located in public and commercial buildings;

 Family daycare: Organized (licensed) daycare facilities located in the provider’s home; and

 Informal daycare: Informal (i.e. not licensed) day care providers, including relatives and nonrelatives. Some of these providers may be paid for their services.

There is a great deal of diversity and complexity in the childcare industry. The formal childcare sector

consists primarily of two types of facilities – center-based care and family daycare. Daycare centers are

typically located in commercial or educational buildings, including schools and university campuses.

They include private for-profit and non-profit facilities that can operate as independent centers or as part

of chains. For-profit facilities can be found in office buildings, factories, other workplace settings, or in

stand-alone facilities. Non-profit facilities may be found in YMCAs or other community centers,

churches, college and university campuses, as well as in office or stand-alone buildings. Government

4 The analysis is limited to kindergartens, pre-schools, daycare centers, family daycare, and informal daycare. Due

to a lack of data, it does not include other facilities that may qualify as COFs under the rule.

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education and human services agencies also provide daycare through programs such as Head Start, as

well as through kindergarten and pre-kindergarten programs at local schools.

Unlike center-based care, family daycare is typically offered in the home of the caregiver. Family

daycare facilities tend to serve smaller groups of children and have a smaller child-to-caregiver ratio

(KeepKidsHealthy 2001). In addition to formal care provided by daycare centers, schools, and family

daycare, children may also be cared for informally by relatives, family friends, or other acquaintances.

Informal care may be paid or unpaid, and usually takes place at the home of either the child or the

provider.

Table 2-7 summarizes the types and numbers of facilities and childcare providers in this universe,

grouping them by the age of their construction. It shows that the rule would apply to 1,656,000 childoccupied facilities, of which 1,559,000 are in target housing.

Table 2-7: Total Number of Childcare Facilities in the United States, Number of

Child-Occupied Facilities Potentially Affected by the Rule

Number by Date of Construction b,c,

Type

Total Childcare

Facilities in the

United Statesa All Pre-1978 All Pre-1960

(1) Schools with prekindergartens and/or

kindergartens

79,000 46,000 25,000

(2) Pre-schools and daycare

centers located outside of

schools

88,000 51,000 28,000

(3) Childcare in target

housing

2,398,000 1,559,000 823,000

Total 2,565,000 1,656,000 876,000

a. The Total Childcare Facilities in the United States count includes facilities constructed

both before and after 1978. Facilities constructed after 1978 are not regulated under

the rule.

b. Not all facilities in the table have lead-based paint.

c. The number of facilities by date of construction is inclusive (pre-1960 is a subset of

pre-1978).

Sources Center for the Childcare Workforce and Human Services Policy Center 2002; U.S.

Bureau of Labor Statistics 2006; U.S. Department of Education 2004; U.S. Department of

Energy 2003; Wilder Research Center 2001, Wilder Research Center 2005.

2.2.1 Daycare Centers and Family Daycare

Establishments involved in the provision of day care of infants or children are classified under NAICS

624410 – Child Day Care Services. This industry covers child day care centers (including those located

in the provider’s home), pre-school centers, nursery schools and pre-kindergarten centers (except as part

of elementary schools). In 2002, Census reported that this industry included over 55,000 firms that

employed nearly 752,000 people (U.S. Census Bureau 2005d). Furthermore, Census reports 618,947

non-employers in the industry (U.S. Census Bureau 2005k).

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While Census covers both family and center-based childcare under NAICS 624410, there is reason to

believe that Census undercounts the number of employer firms in this industry. This is likely to occur for

two reasons. First, it is likely that the number of firms reported by Census primarily includes centers,

since care provided solely by one person (as occurs at many family daycare establishments) would be

classified under non-employer statistics. Second, Census classifies a business into NAICS 624410 if its

primary line of business is the provision of child day care services; it is likely that many facilities have

alternate primary lines of business (YMCAs and churches, for example). The number of non-employers,

on the other hand, is likely to include care providers such as nannies or babysitters that do not constitute

formal care, but that cannot be disentangled from the total count.

In light of the limitations of the Census data, an alternative data source is used for this analysis. In 2005,

the National Association for Regulatory Administration (NARA) in conjunction with the National

Childcare Information Center (NCCIC) conducted a study on the number and licensed capacity of daycare

centers and family daycare establishments in the 50 U.S. states. Based on these data, there are

approximately 115,000 licensed daycare centers in the United States. Because licensing requirements

differ from state to state, this count includes 105,444 facilities licensed as daycare centers, as well as

about 10,000 facilities such as Head Start, religious daycare, and other similar establishments, which are

required to obtain a license in some states, but must only be registered or certified in others.

According to the Department of Housing and Urban Development’s (HUD) First National Health Survey

of Childcare Centers, about 22 percent of licensed daycare centers are located in elementary schools.

Since throughout this analysis, schools are analyzed separately from daycare centers, the number of

daycare centers was reduced by 22 percent, bringing the total number of centers to 89,260. According to

NCES data on public and private schools, however, an additional 1,421 schools without kindergartens

have a pre-kindergarten program (See Section 2.2.2.1). These 1,421 centers are also excluded from the

total center counts to avoid double-counting, bringing the number of centers to 87,840.

In addition to the 115,000 centers, NARA reported a total of 166,514 licensed small family childcare

homes and 47,452 large family childcare homes.5 With the addition of about 16,000 family daycare

homes that are reported as certified, not licensed, NARA reports a total of 229,875 family daycare

facilities.

Because some states either completely exempt family daycare with fewer than a certain number of

students from licensing requirements, or offer voluntary registration, the family daycare numbers reported

by NARA are likely to underestimate the total family daycare universe. As such, to estimate the number

of family daycares, this analysis relied on a 2002 report by the Center for the Childcare Workforce, which

provides data on family childcare providers caring for unrelated children in their own homes. Based on

these data, it is estimated that there are a total of 591,071 family daycare facilities in the United States.

Table 2-8 summarizes the size of the formal (center and family daycare) childcare universe.

5 Here large and small refer to the number of children enrolled. It is not the same as the large and small definitions

used by SBA.

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Table 2-8: Number of Daycare Centers and Family Daycare

Facilities in the United States

Daycare Centers

(excluding schools)

Total Family

Daycare

Number of facilities 87,840 591,071

Sources NARA 2006; Center for Childcare Workforce 2002

2.2.1.1 Daycare Center and Family Daycare Outlook

Figure 2-2 plots changes in the numbers of licensed child-occupied facilities between 1995 and 2004

using information compiled from the Childcare Licensing Studies published annually by the Children’s

Foundation and the National Association for Regulatory Administration (NARA).6These data give larger

counts than the data above because they include facilities in Puerto Rico, Guam and the Virgin Islands.7

But the trends displayed in this data are likely to be present in the smaller data set. The number of

licensed Childcare Centers has grown gradually over time, from 92,000 in 1995 to 120,000 facilities in

2004. The number of Large/Group Family Childcare Homes grew in a similar manner, before tapering

off in 2004. Over the time period specified, the number of Small Family Childcare Homes declined from

276,000 to 256,000, while exhibiting much more variation from year to year than the other two

categories. Here, as noted earlier, large and small refer to the number of children enrolled, not the SBA

definition of a large or small entity.

6 When the Children’s Foundation closed in 2005, NARA assumed sole responsibility for collecting licensing

information through the annual study. However, because the methodology was altered with the new leadership,

data from the 2005 Childcare Licensing Study were not included into Figure 2-2.

7 While the rule would apply to Puerto Rico, Guam and the Virgin Islands, they are not included in this analysis for

reasons of consistency since some of the major data sources used elsewhere in the analysis were limited to the

50 states and the District of Columbia. Holding all other things equal, by not including COFs in Puerto Rico,

Guam, and the Virgin Islands, the analysis underestimates the costs and benefits of the rule.

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Figure 2-2: Number of Licensed Child-Occupied Facilities: 1995-2004

0

50,000

100,000

150,000

200,000

250,000

300,000

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004

Time

Number

Small Family Child Care Homes

Child Care Centers

Large/Group Family Child Care Homes

Sources National Childcare Information Center 2005

The market for lead-safe renovation activities in COFs is dependent on the number of care providing

facilities. Figure 2-2 indicates that while there have been some fluctuations in the underlying components

of the overall market, when considered over the entire time frame, the number of licensed COFs has been

relatively stable.

While there wasn’t significant growth in childcare over the 1995-2004 timeframe, a study forecasts

growth in the demand for childcare labor. Fueling the future demand for childcare services is the

expected increase in the amount of children below 5 between 2004 and 2014. Adding to this growing

demand will be an increased female labor force participation rate, forcing families to find alternate care

options for their children. Furthermore, many states will be implementing their own care programs for 3-

and 4- year old children in the coming years. The government also plans to increase subsidies for lowincome families attending day care programs (Bureau of Labor Statistics 2005). While trends point to

increased demand for childcare labor, it is difficult to assess whether this will be accompanied by an

increase in the number of facilities, and to what extent these new facilities will be located in pre-1978

buildings.

2.2.1.2 Informal Daycare

Informal daycare is provided by unlicensed providers, including relatives, friends, and others.

Calculations determining the number of informal daycare providers are based on figures and percentages

found in a report on the number of paid relatives and non-relatives providing childcare entitled

“Estimating the Size Components of the U.S. Childcare Workforce and Caregiving Population: Key

Findings from the Childcare Workforce Estimate” (Center for Childcare Work Force 2002).

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Target Housing COFs

Family daycare and informal daycare take place in target housing. Renovation events in some target

housing COFs would be regulated under the 2008 LRRP rule regardless of their status as a COF; for

example, if they are owner-occupied units where a child under the age of six or a pregnant woman resides

or if they are rental units. For a detailed explanation of the methodology used to estimate the number of

target housing COFs, please see Section 4.2 of EPA (2009). Section 2.8 presents the estimated numbers

of target housing COFs affected by the rule.

2.2.2 Public and Private Schools

This section describes the number and size of public and private schools with kindergartens and prekindergartens.

2.2.2.1 Number of Schools

According to the National Center for Education Statistics, during the 2004-2005 academic year, there

were 93,295 public schools with students in the United States. In total, these schools served 48.8 million

students (NCES 2006a). The rule will apply only to those portions of schools that meet the COF

definition. Thus, the rule is expected to primarily impact schools that have kindergarten or prekindergarten programs. According to the NCES’s Public Elementary and Secondary School Universe

Survey, which collects data on all operational public schools in the United States, in 2004-2005, 52,129

of the 93,295 U.S. public schools (roughly 56 percent) provided either pre-kindergarten or kindergarten

services.8 Of these 52,129 schools, 20,885 offered both pre-kindergarten and kindergarten and 29,884

schools provided kindergarten services only. Only 1,400 schools offered pre-kindergarten, but not

kindergarten services; this group of schools includes standalone preschools operated by local school

boards, as well as daycare centers located in public middle schools, high schools, and ungraded schools

(See Table 2-9). Note that these figures are not limited to schools with pre-1978 buildings.

Table 2-9: Number of Public Schools, by Type

Type of Public School Number of Schools

Total number of public elementary and secondary schools 93,295

Number of schools with pre-kindergartens and kindergartens 20,885

Number of schools with pre-kindergartens but no kindergartens 1,400

Number of schools with kindergartens, but no pre-kindergartens 29,844

Total number of schools with pre-kindergartens 22,285

Total number of schools with kindergartens 50,729

Total number of schools with pre-kindergartens or kindergartens 52,129

Source NCES 2006a,b

As shown in Table 2-10, in 2004-2005 a total of 990,421 pre-kindergartners and 3,543,554 kindergartners

were enrolled in pre-kindergartens and kindergartens offered at public schools, respectively. Given the

number of programs described above, this means that there are roughly 44 pre-kindergarten students per

school and 70 kindergarten students per school.

8 A school was considered as having a pre-kindergarten if a) pre-kindergarten enrollment was greater than zero

students, or b) the school reported that the lowest grade offered was pre-kindergarten, but enrollment data were

not provided. Similarly, a school was considered as having a kindergarten if a) kindergarten enrollment was

greater than zero, or b) the school reported that the lowest grade offered was pre-kindergarten or kindergarten,

but did not report kindergarten enrollment.

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Table 2-10: Enrollment in Public Pre-kindergarten and Kindergarten Program Statistics

Number of

Schools offering

program

Number of

Students Served

Average Students

Served per School

Pre-kindergartens in public schools 22,285 990,421 44

Kindergartens in public schools 50,729 3,543,554 70

Source NCES 2006a,b

Number of Public School Districts

Public schools in the United States are operated by local education agencies (LEAs), organizations

“responsible for providing free public elementary/secondary instruction or education support services.”

The National Center for Education Statistics collects data on LEAs through its Common Core of Data

(CCD) fiscal and non-fiscal surveys. NCES designed the Common Core of Data system to

“accommodate the many and varied organizational structures used in the provision of public elementary

and secondary education.” As such the CCD contains records that represent “administrative and

operating units that are unlike typical public schools and school districts – for example, regional

administrative service centers without students.”

According to the CCD Local Education Agency Universe Survey, in 2004-2005, 17,647 LEAs operated

in the 50 contiguous states and the District of Columbia. Of these 17,647 agencies, 14,473 operated at

least one school that offered pre-kindergarten or kindergarten services and may thus be affected by the

rule.

Of the 14,473 local education agencies responsible for schools with pre-kindergarten and kindergarten

programs, just under 13,200 are typical public school districts (usually county or town agencies

responsible for providing education services in that location). An additional 949 agencies are charter

school organizations. The remaining 333 agencies represent regional, state, and federal institutions, as

well as supervisory union administrative centers.9Table 2-11 presents a detailed breakdown of the

number of education agencies by agency type, as well as counts of schools with pre-kindergartens and/or

kindergartens operated by each agency.

9 Supervisory union administrative centers operate schools only in Massachusetts, Vermont, and Virginia.

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Table 2-11: Number of Local Education Agencies Operating Schools with Kindergartens or

Pre-Kindergartens, by Agency Type

Type of Local Education Agency

Number of

Agencies

Number of Schools

with Pre-K or

Kindergarten

Programs

Average

Number of

Pre-K or K

Schools

Local School District 13,191 50,386 3.8

Supervisory Union Administrative Office 85 159 1.9

Regional Education Services Agency 167 308 1.8

State Institution 54 75 1.4

Federal Institution 27 188 7.0

Other Agency (Primarily Charter Schools) 949 1,013 1.1

Total 14,473 52,129 3.6

Source: NCES 2006b,c

The NCES collects data on the revenues and expenditures of local education agencies through its CCD

School District Finance Survey. Table 2-12 presents the total revenues, average revenues, and percent

revenues derived from federal, state, and local funds for education agencies operating schools with prekindergarten and/or or kindergarten programs. All figures are based only on agencies with available data;

for each agency type, the table indicates the percent of LEAs represented in the totals. Note that financial

data were not available for any federal institutions, nor for most state institutions.

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Table 2-12: Total Revenues, Average Revenues and Percent of Revenues by Source for Local

Education Agencies Operating with Pre-Kindergarten and/or Kindergarten Programs

Revenues

Percent of Revenues by

Revenue Source

% LEAs

with Data

Total Revenues,

(Millions of $)

Average LEA

Revenues ($) Federal State Local

Local School District 99% $440,444 $33,560,173 8% 47% 45%

Supervisory Union

Administrative Office 91% $1,269 $16,481,935 8% 41% 52%

Regional Education

Services Agency 95% $7,612 $48,180,367 24% 35% 41%

State Institution 7% $8 $2,115,250 12% 54% 34%

Federal Institution 0% n.a. n.a n.a n.a n.a

Other Agency

(Primarily charter

schools) 81% $2,074 $2,683,282 11% 68% 21%

All LEAs 98% $451,408 $31,933,217 9% 46% 45%

Source NCES 2006b,c,d

Table 2-13 presents the total and average expenditures of local education agencies. Total expenditures

are composed of total current expenditures for elementary/secondary education, as well as other

expenditures. Elementary/secondary education current expenditures include expenditures for instruction

(e.g. teacher salaries), support services (including, but not limited to, administrative, maintenance, and

operations costs), and other expenses, such as transportation and food services. Other expenditures

include spending not related to elementary/secondary education, such as expenditures for community

service, or adult education, capital outlay expenditures, payments to other government and educational

entities, and debt interest payments. In Table 2-13 current expenditures are split out by type, while the

remainder (capital and non-educational) are combined and labeled as “all other” expenditures.

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Table 2-13: Total Expenses, Average Expenses, and Percent of Expenditures by Expenditure

Type for Local Education Agencies

Expenses

Percent of Expenditures by Expenditure

Type

% LEAs

with Data

Total

Expenses (in

Millions of $)

Average

Expenses Instruc.

Support

Service

Other

Current

All

Other

Local School District 99% $451,464 $34,399,846 52% 28% 3% 17%

Supervisory Union

Administrative Office 91% $1,203 $15,628,805 57% 32% 3% 8%

Regional Education

Services Agency 95% $7,154 $45,278,905 28% 33% 1% 38%

State Institution 7% $7 $1,759,000 49% 39% 0% 11%

Federal Institution 0% n.a. n.a. n.a. n.a. n.a. n.a.

Other Agency (Primarily

charter schools) 81% $2,023 $2,616,922 47% 41% 3% 9%

All LEAs 98% $461,851 $32,671,971 51% 29% 3% 17%

Sources NCES 2006b,c,d

For most LEAs, the majority of expenditures (51 percent on average, across all LEAs) are spent on

instruction. In aggregate, the category containing maintenance costs (i.e. support service) makes up

around one-third of all expenditures. Lastly, the “all other” expenditures category makes up a significant

percentage of the expenditures for regional education services agencies.

Under the Regulatory Flexibility Act, public school districts are considered large if they serve a

population of more than 50,000. Table 2-14 presents the number of LEAs that operate schools that have

pre-kindergartens and/or kindergartens, by agency type and the size of the population served.

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Table 2-14: Local Education Agencies that operate schools with Kindergartens

and/or Pre-Kindergartens, by Agency Type and Size of Population Served

Type of Local Education

Agency

Total Number of

LEAs with Pre-K

or K Programs

Number of LEAs

Serving < 50,000a

Small LEAs as %

of all LEAs with

Pre-K or K

Programs

Local School District 13,191 12,130 92%

Supervisory Union

Administrative Office 85 84 99%

Regional Education

Services Agency 167 167 100%

State Institution 54 0

b

0%

Federal Institution 27 0

b

0%

Other Agency (Primarily

charter schools) 949 949 100%

All LEAs 14,473 13,330 92%

a. Local districts, supervisory union offices, regional education agencies and charter school

districts for which no population data were available were assumed to serve a population of

fewer than 50,000.

b. Assumes that all state and federal agencies are large.

Source NCES 2006b,c,e,g

Private schools

In 2003-2004, the National Center for Education Statistics conducted a survey of private schools in the

United States. NCES’s Characteristics of Private Schools in the United States: Results From the 2003-

2004 Private School Universe Survey (2006) presents a summary of survey results, including numbers of

schools currently in operation, the number of students enrolled, and teachers employed. Table 2-15

presents summary statistics on national private schools, including a total count of all private schools,

enrollment and teachers, as presented in NCES’s report.

Table 2-15: Enrollment and Teacher Statistics for Private Schools

Entity

Number of

Schools

Total

Enrollment

Total

Teachers

Average

Enrollment

Average

Teachers

Private Schools 34,681 5,212,992 441,384 150.3 12.7

Sources: NCES 2006e

According to the NCES data, in 2003-2004 there were 34,681 private schools in the U.S., enrolling a total

of just over 5.2 million students, with a total teaching staff of over 441,000. On average, there were 150

students enrolled in a private school and 13 teachers per school. These figures must be interpreted with

caution however, since they encompass elementary schools, secondary schools, etc. which, by definition,

include different numbers of classes.

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While the NCES report provides some data on the number of private schools by grade level, it does not

provide data on grades offered by each individual school in the survey. In order to identify schools with

kindergartens only, pre-kindergartens and kindergartens, and pre-kindergartens only, this analysis relied

on the Excel database underlying NCES’s 2003-2004 report. This database, which contains records for

29,907 of the estimated 34,461 private schools in the United States, specifies the highest and lowest grade

offered at each school, as well as the number of students enrolled in each grade. The database, however,

does not include sampling weights used to adjust some of the survey results to generate final numbers

presented in NCES’s report. In order to most accurately estimate the number of schools offering each

combination of kindergarten or pre-kindergarten programs, as well as the number of children enrolled in

these programs, this analysis:

 used the underlying database to identify schools with pre-kindergartens only, kindergartens only,

and both kindergartens and pre-kindergartens, then

 inflated these counts to account for the 4,500 schools that were not included in the database. The

numbers of schools offering each combination of programs was inflated using the ratio of the

number of schools presented in the published report to the number of schools included in the

database. Similarly, the number of children in each school setting, estimated based on the

underlying data, was adjusted using the ratio of the number of kindergartners presented in the

published report to the number of kindergartners reported in the database.10

Table 2-16 breaks down the totals from the previous table to provide a count of the number of private

schools with pre-kindergartens and/or kindergartens.

Table 2-16: Number of Private Schools, by Type

Type of Private School

Number of

schools

Total number of private elementary and secondary schools 34,681

Number of schools with pre-kindergartens and kindergartens 19,305

Number of schools with pre-kindergartens and no kindergartens 21

Number of schools with kindergartens but no pre-kindergartens 7,205

Total number of schools with pre-kindergartens 19,326

Total number of schools with kindergartens 26,510

Total number of schools with pre-kindergartens or kindergartens 26,531

Source NCES 2006e

Of the 34,681 private schools counted in the 2003-2004 survey, 26,531 provided either pre-kindergarten

or kindergarten services.11 Furthermore, of these 26,531 private schools, 19,305 provided both prekindergarten and kindergarten services. Only 21 private schools provided pre-kindergarten but not

10 In its report, NCES tracks schools where kindergarten is the highest grade offered separately from regular

elementary, middle and high schools. As such, when inflating counts obtained from underlying data, the

analysis calculated two sets of ratios for the numbers of schools and numbers of children enrolled – one for

regular, and another for kindergarten-terminal schools.

11 A private school was identified as having a pre-kindergarten or kindergarten in the same fashion as a public school

was in Section 2.2.1.

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kindergarten services12; while 7,205 private schools offered kindergarten but not pre-kindergarten

services. Note that these figures are not limited to schools in pre-1978 buildings.

Table 2-17 presents a count of the number of pre-kindergarten and kindergarten students served in private

schools, as well as the average number of students served per school.

Table 2-17: Total Number and Average Kindergarten and Pre-Kindergarten Students

Served Per School

Number of Schools

offering Program

Number of Students

Served

Average Students

Served per School

Pre-kindergartens in private schools 19,326 863,542 45

Kindergartens in private schools 26,510 555,531 21

Source NCES 2006e

According to Table 2-17, there are 26,510 private schools with kindergartens, enrolling a total of 555,531

kindergarteners. Also, there are 19,326 private schools with pre-kindergartens, enrolling 863,542 prekindergarten students. The average number of private pre-kindergarten students per school (45) is more

than double the average number of kindergarten students (21). Whereas public schools displayed nearly

the opposite ratio with on average 44 pre-kindergarten students and 70 kindergarten students per school.

Non-profit organizations, including private schools, are defined as small under the Regulatory Flexibility

Act if they are independently owned and operated and not dominant in their field. While determining

whether a school meets this definition is difficult, it is useful to present some statistics describing the size

distribution of private schools. Table 2-18 shows the distribution of private schools by the number of

students they serve. This represents the total number of students served, and not just the number of

kindergarten and pre-kindergarten students.

Table 2-18: Schools with Kindergarten or Pre-Kindergarten programs, by Number of

Students in the School

Number of Students Served

<100 100-499a500-999 1000-1499 >1500

Total % Total % Total % Total % Total %

Number of

Private School 10,862 41% 13,951 53% 1,519 6% 161 1% 38 0%

Note: schools that did not report the total number of students were considered as having less than 100 student

a. Includes all schools with missing total student data. These schools are assumed to have student enrollment

equal to the average school with over 100 students, or 285.

Source NCES 2006e

The distribution of private schools in the U.S. is heavily skewed toward smaller schools, with 94% of

private schools serving less than 500 students and 99% of private schools serving less than 1000 students.

12 Beginning in 1995, the definition of school employed by the Private School Survey was expanded to include

schools whose highest grade was kindergarten. Therefore, these statistics are likely to include some prekindergartens that are more likely also classified as preschools in other sources (NCES 2006e). Later sections

explain how the calculations avoid double-counting. However, because this is a small figure, it is almost

negligible.

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However, these data do not indicate whether the schools are affiliated with or part of a larger

organization.

2.3 Nonresidential Commercial Property Owners and Managers

Nonresidential commercial property owners and managers will be affected by the rule if they rent space to

daycare facilities or other COFs in buildings constructed prior to 1978. The number and size of firms in

this industry is described below.

2.3.1 Industry Definitions and Characteristics

Firms involved in the leasing of nonresidential buildings (except Miniwarehouses) are classified under

NAICS 531120 – Lessors of nonresidential buildings (except Miniwarehouses). In 2002, this industry

included 28,426 firms that employed 154,725 people (U.S. Census Bureau 2005b).

Firms involved in the management of non-residential properties are classified under NAICS 531312 –

Nonresidential property managers. In 2002, this industry included 10,506 firms that employed 125,616

people (U.S. Census Bureau 2005b).13 Table 2-19 includes only firms with employees. The U.S. Census

Bureau does not differentiate between self-employed individuals that lease or manage commercial real

estate as opposed to residential buildings. This analysis assumes that non-employers primarily lease

residential buildings, rather than commercial property. As such, non-employer establishments are not

included in this profile, or in the remainder of the analysis.

Table 2-19: Summary Statistics for NAICS 531120 and NAICS 531312

NAICS Code and Description Firms

Annual Revenues

(000)

Annual Payroll

(000) Employees

531120 - Lessors of

nonresidential buildings (except

miniwarehouses)

28,426 $51,778,431 $5,384,512 154,725

531312 - Nonresidential property

managers

10,506 $12,297,703 $5,521,674 125,616

Total 38,932 $64,076,134 $10,906,186 280,341

Sources U.S. Census Bureau 2005j

The 2008 LRRP rule economic analysis (EPA 2008) indicated that a total of 17,705 daycare centers rent

space in pre-1978 buildings. Because daycare centers are only one of many types of establishments

renting non-residential space, and because the rule applies only to centers in buildings constructed prior to

1978, the analysis also assumes that each property manager or lessor firm owns only one regulated

building. As such, the number of affected lessor/manager firms is equivalent to the number of daycare

centers renting space, or 17,705.

2.3.2 Establishment Size and Industry Environment

The U.S. Small Business Administration indicates that to qualify for small business status, a firm in

NAICS 531120 must have revenues of less than $7 million, while firms in NAICS 531312 must have

revenues of less than $2 million (U.S. Small Business Administration 2008). Average revenues in these

NAICS codes are significantly below the small business designation threshold (Table 2-20).

13 Firms involved in the leasing and/or management of residential buildings are already covered under the residential lead RRP

rule.

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Table 2-20: Summary Statistics for NAICS 531120 and NAICS 531312 (Per Firm)

NAICS Code and Description

Average Annual

Revenues ($)

Average Annual

Payroll ($)

Paid Employees

Per Firm

531120 - Lessors of

nonresidential buildings (except

miniwarehouses)

$1,821,517 $189,422 5.4

531312 - Nonresidential property

managers

$1,170,541 $525,573 12.0

Sources U.S. Census 2005j

Census data are not specific enough to report revenues at either the $7 million dollar or $2 million dollar

cutoff; Table 2-21 presents the percent of firms in NAICS 531120 and NAICS 531312 that have revenues

below $5 million and $1 million respectively. Consequently, the figures in Table 2-21 are all

underestimates of the true percentages of firms that qualify as small businesses.

Table 2-21: Small and Large Firms as Percent of Industry

NAICS

Code: Description

Percent of

Firms by

Revenue

Bracket

Percent of

Industry

Revenues by

Revenue

Bracket

Percent of

Industry

Employees by

Revenue

Bracket

531120 Lessors of nonresidential buildings (except mini-warehouses)

Firms with Revenues < $5 million 96% 32% 73%

Firms with Revenues of $5 million+ 4% 68% 27%

531312 Nonresidential property managers

Firms with Revenues < $1 million 81% 19% 26%

Firms with Revenues of $1 million + 19% 81% 74%

Sources: U.S. Census 2005j

Based on 2002 data, 96 percent of NAICS 531120 firms and 81 percent of NAICS 531312 firms have

revenues below $5 million and $1 million, respectively. In the Lessors of Nonresidential Buildings

industry, these firms contribute 32 percent of the industry revenues while employing 73 percent of the

workforce. The revenue and employment distribution is more skewed in the Nonresidential Property

Managers sector. Small firms in this industry contribute only 19 percent of the revenues, while

employing only 26 percent of the workforce.

2.4 The Demand for Renovation Services

The demand for renovation is responsive to changes in the overall economic conditions. The same factors

that stimulate economic growth, such as low unemployment, high consumer confidence and low interest

rates, also stimulate the demand for renovation activities. For both residential and nonresidential building

projects, the U.S. Census Bureau tracks information on the “value of construction put in place,” a figure

composed of some of the variables previously discussed in this chapter such as labor and material costs

(while also including other variables such as the contractors profit, the cost of architectural and

engineering work, etc). Although the definition of construction includes renovations, alterations,

additions, and other improvements, it does not include “maintenance and repairs to existing structures or

service facilities” (U.S. Census Bureau 2006d), two components of primary interest to this rule.

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Using this Census data, Figure 2-3 illustrates the relationship between the value of construction put in

place for private preschools (a term that includes childcare and day-care centers, nurseries, and

preschools), state and local elementary school buildings, private primary and secondary educational

buildings, and real GDP (U.S. Census Bureau 2006b,c).14 Both real GDP and the value of state and local

construction of elementary school buildings substantially increased over the previous 12 years.

Meanwhile, the value of private preschool construction and private primary and secondary educational

buildings construction have seen more moderate growth, peaking around 2001 and then gradually

tapering off.

Figure 2-3: Annual Value of Construction Put in Place Compared to GDP

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Year

Millions of Dollars

7,000,000

7,800,000

8,600,000

9,400,000

10,200,000

11,000,000

11,800,000

State and Local Construction of Elementary School Buildings - Read Left-Hand Vertical Scale for Values in

Millions of Dollars

Private Preschool Construction - Read Left-Hand Vertical Scale for Values in Millions of Dollars

Private Primary and Secondary Educational Building Construction - Read Left-Hand Scale for Values in

Millions of Dollars

Real Gross Domes ic Product in millions of chained 2000 dollars - Read Right-Hand Vertical Scale for

Values in Millions of Dollars

Source U.S. Census Bureau 2006b,c; U.S. Department of Commerce 2006

Construction is a term that encompasses not only the creation of new buildings but renovations to older

structures as well. While the Census tracks this breakdown between renovation and new building

construction for residential construction, it does not for non-residential construction. The U.S. Census

Bureau, however, did compile statistics for the expenditures of non-residential improvements in 1986,

14 State and Local Construction of Elementary School Buildings is meant to give an indication of public kindergarten

construction, while Private Primary and Secondary Educational Building Construction is meant to give an

indication of private school kindergartens. Since the variables shown in Figure 2-3 are more broadly defined

than the variables of interest, they overestimate the value of construction put in place.

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1989, and 1992. The U.S. Census defines improvements as “additions, alterations (renovations,

remodeling, etc.) and major replacements.” While not being able to collect data on the number or extent

of the individual projects, the Census was able to make some estimations in the non-residential domain,

concluding that “about 23 percent of all buildings had some improvement work, while about 71 percent

had some expenditures for repair” (U.S. Census Bureau 1999). The collected data, however, were not

specific enough to capture improvement expenditures on COFs. Thus, Table 2-22 presents improvement

expenditures as the percentage of the total value of non-residential educational building construction put

in place in each of the three years for which improvement expenditure data were available.

Table 2-22: Improvement Expenditures as a Percentage of the Value of

Construction Put in Place for Non-Residential Educational Buildings

Type of Construction 1986 1989 1992

Private Non-Residential Educational

Buildings 40% 46% 19%

State and Local Non-Residential

Educational Buildings 58% 35% 41%

Source: U.S. Census Bureau 1999, U.S. Census Bureau 2006b,c

As shown in Table 2-22, expenditures on improvements as a percent of the total value of educational

building construction put in place vary year to year. Expenditures on improvement made up between 35

and 58 percent of the total value of construction put in place in either private or state and local nonresidential buildings in the three selected years, with the data moderately variable. These figures indicate

that a substantial amount of non-residential educational building expenditures are for activities that might

disturb lead-based paint. The high frequency of these improvement activities points to the importance of

schools in this rule.

2.5 Renovation Industry Market Structure

The previous sections focused on the supply and demand for renovation services. This section discusses

the overall market structure of the renovation industry.

Firms and consumers interact in markets for goods and services with the results of these interactions

depending on the competitive characteristics of the market. Competitive markets are characterized as

markets with a large number of buyers (e.g., consumers) and sellers (e.g., firms) and relatively

homogeneous goods. In competitive markets, neither firms nor consumers can influence the price of the

good by altering their supply or demand decisions. Oligopolistic, monopolistic and monopsonistic

markets are markets where either firms or consumers have market power and exhibit strategic behavior to

change the price of the good sold. The competitive nature of an industry can be estimated by examining

the following market characteristics.

 Number of establishments;

 Specialization of establishments;

 Number of consumers;

 Barriers to entry;

 Availability of substitutes; and

 Homogeneity of the good/service.

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The data in Section 2.1 indicate that there are a large number of firms in the construction industry. Using

data for the twelve NAICS codes, there are approximately 394,365 establishments with employees in

construction sectors potentially affected by the rule. Of these establishments, only 2.3 percent have

annual revenues of $10 million or more. In addition, there are about 1.2 million self-employed contractors

in these industries, all of which are, in all likelihood, considered small by SBA standards. Given the large

number of small establishments, it is unlikely that any one firm exhibits substantial market share in the

overall market for renovation services. It is possible in some geographic areas for a small number of

firms or a single firm to establish a market niche, but overall the market for renovation services appears to

be quite competitive on the supply side.

The relatively low barriers to entry in the renovation industry enhance the competition taking place within

it. Much of the work covered by this rule does not require particularly unusual or high levels of skills.

Renovation work has traditionally attracted recent immigrants because a lack of English is not important

(Farzad 2005). While any training required as part of this rule will increase the skill level, the cost of the

training is expected to be relatively low.

There are also a large number of consumers in the industry. As such, no single consumer of renovation

services is expected to exhibit influence over the price of these services.

There are three sources of substitutes for renovation services. First, consumers can substitute from one

contractor to another. Second, consumers can substitute away from professional renovation and into DIY

work. This is less likely to occur for COFs than for residential RRP work. Operators of COFs must be

certified and have their employees trained in order to do covered RRP in the facility. Third, consumers

can reduce the scope of the project or forgo renovation altogether. However, that is unlikely as the cost of

the rule is a relatively small share of the cost of a renovation. Again, this is less likely to occur for COFs

than for residential RRP work. Many states require annual inspections in COFs that assess the amount of

chipped or peeling lead-based paint and dictate that appropriate measures must be taken to alleviate the

risk that it imposes.

Additional characteristics of the RRP market result in reduced demand elasticity. First, some

differentiation in RRP services does exist. Contractors can provide services at a higher price if they can

convince consumers that their services are better or distinctly different from their competitors. This is an

important factor in anticipating the impact of the RRP requirements on contractors. The costs of safely

renovating or repairing target housing and COFs are expected to be higher than traditional methods. If

the consumer is indifferent between safe- or unsafe-lead work practices, then those companies that choose

not to use lead-safe work practices may have a competitive advantage in the market due to lower costs.

However, if the consumer recognizes that higher quality renovation jobs are those jobs completed with

lead-safe work practices, then firms may be able to comply with the regulation and charge a higher price.

Under such a scenario, the consumer’s marginal benefit for an additional unit of safe renovation may be

higher than for an additional unit of unsafe renovation. The consumer who has a preference for lead-safe

work practices would choose to do lead-safe renovation as long as the incremental cost of the lead-safe

renovation is less than the incremental benefit of such a renovation. Also, the market for RRP services is

fragmented and there are substantial costs involved in getting prices. Getting bids from various

contractors takes time and consumers need to compare prices across services that differ along many

dimensions. These difficulties make it easier for firms to increase their prices to cover the costs for the

new requirements.

The combination of a large number of firms, a large number of consumers, low barriers to entry, and

available substitutes indicate that the renovation industry is likely to have a relatively high price elasticity

of supply. The price elasticity of demand, however, may be small in absolute value.

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2.6 Residential Property Owners & Managers

Property owners and managers also will be affected by the rule if they choose to perform their own RRP

projects rather than hire an outside contractor or if their renovation and maintenance costs rise as a result

of the regulations.

Property owners and managers may have in-house crews that perform RRP activities. If this is the case,

then the property owners and managers will directly bear the costs of training and certifying their workers

as well as the cost of safe work practices. Furthermore, because all firms that perform regulated RRP

projects will experience an increase in costs due to training of supervisors and workers and the use of safe

work practices, it is assumed that costs to property owners and managers who hire outside contractors will

increase.

2.6.1 Industry Definitions and Characteristics

Establishments involved in the leasing of apartments and other residential units are classified under

NAICS 531110 - Lessors of Residential Buildings and Dwellings. This industry, in turn, is divided into

two sub-sectors, NAICS 5311101—Lessors of Apartment Buildings and NAICS 5311109—Lessors of

Dwellings Other than Apartment Buildings. According to the 2002 U.S. Economic Census data, together

these industries include a total of 61,787 establishments that employ 292,405 people (U.S. Census Bureau

2004b).

Establishments involved in the management of residential properties are classified under NAICS

531311—Residential Property Managers. In 2002, this industry included 26,233 establishments that

employed 289,870 people (U.S. Census Bureau 2004b). Table 2-23 presents summary statistics for the

businesses in NAICS 531311 as well as NAICS 531110 and its sub-sectors.

Table 2-23: Summary Statistics for NAICS 531110, NAICS 5311101 and NAICS 5311109

NAICS Code and Description Establishments Annual Revenues

(000)

Annual Payroll

(000) Paid Employees

5311101 - Lessors of Apartment

Buildings 51,502 $51,708,553 $5,831,398 257,624

5311109 - Lessors of Dwellings

other than Apartment Buildings 10,285 $5,263,795 $748,821 34,781

531311 - Residential property

managers 26,223 $19,988,344 $8,193,831 289,870

Total 88,010 $76,960,692 $14,774,050 582,275

Source U.S. Census Bureau 2004b

2.6.2 Establishment Size and Industry Environment

The U.S. Small Business Administration indicates that to qualify for small business status, a firm in

NAICS 531110 must have annual revenues of less than $7 million, while establishments in NAICS

531311 must have revenues of less than $2 million (U.S. Small Business Administration, 2004).

Although data on the number of firms by revenue bracket were not available from the 2002 U.S.

Economic Census when this analysis was performed, the average revenues of establishments in these

NAICS codes are significantly below the small business designation threshold (Table 2-24).

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Table 2-24: Summary Statistics for NAICS 531110, NAICS 5311101 and NAICS 5311109

(Per Establishment)

NAICS Code and Description Average Annual

Revenues ($)

Average Annual

Payroll ($)

Paid Employees per

Establishment

5311101 - Lessors of Apartment

Buildings $1,004,011 $113,227 5.0

5311109 - Lessors of dwellings

other than apartment buildings $511,793 $72,807 3.4

531311 - Residential property

managers $762,245 $312,467 11.1

Source U.S. Census Bureau 2004b

In 1997, 98.7 percent of the then 51,572 establishments in the Lessors of Residential Buildings and

Dwellings sector had annual revenues below $5 million and about 85 percent of the 19,000 establishments

in NAICS 531311 had revenues less than $1 million (U.S. Census Bureau 2000a).15 Because 2002 data

on the number of establishments by revenue bracket was not available at the time the estimates were

developed, 1997 data was used to estimate the percent of establishments in each industry that qualify for

small business status. Table 2-25 presents the percent of NAICS 531311 and NAICS 531110

establishments that have revenues below $1 million and $5 million, respectively. The table also presents

the percent of industry revenues and employment that can be attributed to these establishments.

Table 2-25: Small and Large Establishments as Percent of Industry

NAICS

Code Description

Percent of

Establishments by

Revenue Bracket

Percent of Industry

Revenues by

Revenue Bracket

Percent of Industry

Employees by

Revenue Bracket

531311 Residential Property Managers

Establishments with Revenues < $1 million 85 35 40

Establishments with Revenues of >$1 million 15 65 60

531110 Lessors of Residential Buildings and Dwellings

Establishments with Revenues < $5 million 99 82 86

Establishments with Revenues of >$5 million 1 18 14

Source U.S. Census Bureau 2000a

Based on 1997 data over 85 percent of NAICS 531311 establishments, and about 99 percent of NAICS

53110 establishments have revenues below the small business threshold defined by SBA. In the

Residential Property Manager industry, these establishments contribute only 35 percent of the revenues,

and employ only 40 percent of the workforce. The revenue and employment distribution is less skewed in

the Lessor of Residential Buildings and Dwellings sector. Small establishments in this industry

contribute about 82 percent of the revenues and employ 86 percent of the workforce (U.S. Census Bureau

2000a).

2.6.3 Industry Outlook

The market for lead-safe renovation activities will depend in part on the state of the rental housing

market—an increase in rents would provide resources to construct new housing and/or renovate existing

15 Includes establishments open year-round only.

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housing. According to Harvard University’s Joint Center for Housing Studies (JCHS), “rents fell in 9 of

the 27 metropolitan areas tracked by the federal government [in 2003]. Nationally, real contract and gross

rents barely increased last year.” The JCHS indicates that both the weak labor market and increased

home ownership contributed to the softening of the rental market (JCHS 2004).

At the same time as rents fell, the nation-wide rental vacancy rate increased from 8.9 percent in 2002 to

9.8 percent in 2003. The vacancy rate was slightly above 10 percent during the first three quarters of

2004 (U.S. Census Bureau 2004e). None-the-less, the JCHS predicts a strengthening of the rental market

over the next ten years due to the influx of immigrants and the aging of the “echo baby-boom generation.”

The strengthening of the market may also come from overall economic growth and a stemming of home

ownership growth due to rising interest rates and/or house prices (JCHS 2004).

2.7 Training Providers

Impacts of the rule will be felt beyond the construction industry. Certified renovators will need

accredited training. Both initial and refresher training courses will be required for certified renovators.

2.7.1 Definitions and Industry Characteristics

It is likely that lead-based paint training courses will be provided by establishments categorized as

NAICS code 611519: Other Technical and Trade Schools. Census defines NAICS 61159 as

“establishments primarily engaged in offering job or career vocational or technical courses (except

cosmetology and barber training, aviation and flight training, and apprenticeship training). The

curriculums offered by these schools are highly structured and specialized and lead to job-specific

certification” and these establishments are believed to currently provide training for lead abatement

professionals (U.S. Census Bureau 2004p).

According to the 2002 Economic Census, there are a total of 3,323 establishments in the U.S. certified as

Other Technical and Trade Schools (see Table 2-26). On average, each establishment employs 15.3

people. A striking characteristic is that about 19% of these establishments are exempt from the Federal

Income Tax (FIT). Exempt establishments include non-profit organizations and educational institutions

such as colleges or universities.

Table 2-26: Number of Establishments in NAICS 611519

Industry Number of

Establishments

Total Number

of Employees

Average Number

of Employees

NAICS 611519 - Other Technical and

Trade Schools 3,323 50,709 15.3

Source: U.S. Census Bureau 2004n

Table 2-27 summarizes available financial information for establishments categorized under NAICS

611519. These include total revenues for the sector, average annual revenues per establishment, annual

payroll for the sector, and payroll as a percent of revenue. As Table 2-27 indicates, for Other Technical

and Trade schools, annual payroll is equal to about 35 percent of establishment revenue.

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Table 2-27: Summary Statistics for NAICS 611519

Industry Number of

Establishments

Annual

Sector

Revenue

(000)

Average

Revenue per

Establishment

(000)

Average Payroll

per

Establishment

(000)

Labor

Cost as

percent of

Revenue

NAICS 611519 -

Other Technical and

Trade Schools

3,323 $4,118,995 $1,240 $429 35 %

Source: U.S. Census Bureau 2004n

According to the U.S. Small Business Administration, in order to qualify as a small business, a firm

categorized under NAICS 611519 must have annual revenues of $7 million or less (U.S. Small Business

Administration 2006a).16 The 2002 Economic Census provided data on the number of firms by revenue

bracket. In 2002, 94 percent of the then 2,274 firms classified as Other Technical and Trade Schools that

were in operation for the entire year had revenues under $5 million (U.S. Census Bureau 2005f). This

figure indicates that a large percentage of firms had revenues under the $6.5 million threshold and thus

qualified for small business status.

2.7.2 Number and Type of Training Establishments

As mentioned in Section 2.7.1, there are over 3,000 establishments in the Other Technical and Trade

school industry. It is likely that only a small portion of these establishments are involved in lead based

paint-related training. To help characterize the lead training segment of the training provider industry, a

random sample of firms that offer one or more of the courses required for EPA lead abatement

certification were identified as part of the economic analysis of the 2006 proposed LRRP target housing

rule (EPA 2006). The goal was both to collect tuition data for currently offered lead abatement training

courses and to learn what types of institutions (private establishments, non-profits, unions, etc.) offer

these classes.

The sample consisted of 83 establishments selected from the Lead Listing17 directory of 194 training

providers.18 Data were collected from company web sites (when available) and/or over the phone.

Information was obtained from 68 training providers; a total of 15 training providers could not be

reached. Seven of the 68 contacted providers no longer offered lead abatement training courses.

There were five types of training providers in the sample: private for-profit establishments, non-profit

establishments, educational institutions, trade unions and public/government training institutions. Trade

unions provide tuition-free training to their members. Public/government providers train state employees

and workers who qualify for financial assistance through government programs. They do not offer

training to the general public.

16 Effective July 31st, 2006.

17 The Lead Listing (www.leadlisting.org) website was run for the U.S. Department of Housing and Urban

Development’s Office of Healthy Homes and Lead Hazard Control that contained a directory of lead service

providers. It is no longer in operation (as of late 2004).

18 The sample included all the establishments on the list that are certified to offer a Project Designer course (42

total), as well as a random sample of 41 establishments that were not certified to offer this class. The data were

weighted by the inversed probability of selection into the sample (P=1 for providers that offer a Project

Designer course and P=.270 for providers that do not offer this class). It was assumed that there was no nonresponse bias.

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Table 2-28 summarizes the number of private establishments, educational institutions, non-profits, unions

and public government providers that appeared in the sample. The table also presents the estimated

national number of providers that fall into each of these categories. More than a third of lead hazard

reduction training providers are private, for-profit establishments. The next largest group of providers is

labor unions, followed by educational institutions (colleges and universities). None of the unions,

however, are certified to offer the Project Designer course. About 13 percent of certified providers either

do not offer training at this time, or have permanently stopped offering lead courses.

More than half of the privately owned, for-profit establishments in the sample (19 out of 35) offer

environmental consulting services in addition to training. Thirteen of the 35 privately-owned providers

specialize in training and do not offer other services. All of these 13 firms offer both lead and asbestos

training courses, as well as, in most cases, OSHA safety, HAZ-MAT and/or mold classes. Although there

was not enough information to determine the services provided by the remaining three companies, these

findings indicate that lead-based paint training providers generally participate in several lines of business.

Table 2-28: Estimated Number of Training Providers

National Estimates Type of Provider Number in

Sample Total Percent

Private Providers 35 74 38

Educational Institutions 11 27 14

Non-Profit 4 19 10

Union 9 42 22

Pub/Gov Providers 2 6 3

No Longer Offer Training 7 26 13

Total Companies 68 194

a. Adjusted for non-response assuming no non-response bias and weighted

based on the probability of selection into the sample

Source: U.S. Environmental Protection Agency 2006

2.8 Summary Characteristics: Numbers of Structures in the Regulated

Universe

This section provides summary information about the numbers of target housing and public or

commercial building COFs that form the basis for the analyses presented in the subsequent chapters of

this report. Each tally is then subdivided into categories based on the age of the building and the type of

structure. After each table, there is a discussion of how the numbers presented in that table were

calculated.

Table 2-29 provides counts of the number of buildings by type and vintage of building. There are 78.0

million structures that would be covered by the LRRP rule if the proposed LRRP Opt-Out and

Recordkeeping rule is finalized. These units include 77.9 million target housing units and 0.1 million

COFs in public or commercial buildings. About 40.2 million target housing units would be added to the

regulated universe due to the elimination of the opt-out provision. Table 2-29 also shows the regulated

universe under the existing 2008 LRRP rule (37.7 million target housing units and 0.1 million public and

commercial buildings).

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Table 2-29: Number of Structures, by Type and Age of Construction

Type All Pre-1960 All Pre-1978

Target Housing where LLRP rule is applicable assuming opt-out provision

removal 41,040,000 77,888,000

Target Housing where LRRP program was applicable under 2008 LRRP

Rule: Rental, COF, or where a child <6 or pregnant woman resides) 20,321,000 37,665,000

Rental where a child <6 or pregnant woman resides 2,187,000 4,130,000

Rental where no child <6 or pregnant woman resides 14,180,000 26,289,000

Owner-Occupied where a child <6 or pregnant woman resides 3,529,000 6,422,000

Owner-Occupied COF where no child <6 or pregnant woman

resides 424,000 824,000

Target Housing COFs 823,000 1,559,000

Renter-Occupied COF where a child <6 or pregnant woman

resides 33,000 62,000

Renter-Occupied COF where no child <6 or pregnant woman

resides 214,000 397,000

Owner-Occupied COF where a child <6 or pregnant woman

resides 152,000 276,000

Owner-Occupied COF where no child <6 or pregnant woman

resides 424,000 824,000

Target Housing Universe affected by elimination of the opt-out

provision (Owner-Occupied where no child <6 or pregnant woman

resides that is not a COF) 20,719,000 40,222,000

Public or Commercial Building COFs 54,000 97,000

Daycare Centers* 29,000 52,000

Schools* 25,000 45,000

Kindergarten Only 12,000 21,000

Kindergarten and Pre-Kindergarten 13,000 23,000

Note: Counts include buildings with and without lead-based paint.

* There are 800 pre-1978 schools that have pre-kindergartens but no kindergarten. In this table and in the cost

and benefits analysis in Chapters 4 and 5, they are accounted for as daycare centers. In the small entity impact

and Unfunded Mandates Reform Act analyses in Chapter 6 these buildings are accounted for as schools.

2.8.1 Target Housing

This section provides a brief discussion of the estimates of the number of the target housing units

presented in Table 2-29. Estimates of the number of housing units by tenure of occupant (owner or

renter), age of occupants, and pregnancy status of occupants were estimated using the 2003 American

Housing Survey, which is described in more detail in Section 4.2 of the Economic Analysis for the LRRP

Opt-Out and Recordkeeping Proposed Rule (EPA 2009). EPA (2009) also provides a detailed

explanation of the estimated number of target housing units that are defined as COFs. The COFs in target

housing include family daycare providers and the homes of family, friends, and neighbors who regularly

care for someone else’s children. These estimates include care provided for pay and not for pay, and rely

primarily on estimates of the size of the childcare workforce as published by the Center for Childcare

Workforce, 2002. This report includes data on the number of: (1) family childcare providers caring for

unrelated children, (2) paid relatives and non-relatives providing childcare, and (3) unpaid relatives and

non-relatives providing childcare. Based on data provided by the Center for Childcare Workforce, a total

of just under 2.4 million caregivers provide care outside of the child’s home for more than six hours per

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week. As described in detail EPA (2009), these data are used to estimate the number of COFs in target

housing. These numbers are further reduced to estimate the number of pre-1960 and pre-1978 housing

units based on American Housing Survey data.

2.8.2 Childcare Centers

In 2006, the National Association for Regulatory Administration (NARA) released a report entitled “The

2005 Childcare Licensing Study” providing counts of all the licensed childcare centers and family

childcare homes in the United States. The NARA report indicated that there were approximately 115,000

licensed childcare centers, 66,700 of which are estimated to be built before 1978 according to

Commercial Building Energy Consumption Survey (CBECS) data (DOE 2003). According to HUD's

First National Health Survey of Childcare Centers (HUD 2003), approximately 24 percent of licensed

centers are located in elementary schools. These 15,753 centers are assumed to be included in the

estimated 40,190 elementary schools with pre-schools and kindergartens. Thus, there are a total of

50,947 pre-1978 daycare centers located outside of elementary schools. According to NCES data on

public and private schools, however, an additional 824 pre-1978 schools without kindergartens have a

pre-kindergarten program, which brings the total number of buildings accounted for as daycare centers to

51,771 (EPA 2008).

2.8.2.1 Public Schools

The National Center for Education Statistics (NCES) reported that during the 2004-2005 academic year,

there were more than 93,000 public schools in the United States. Of these 93,295 public schools, 52,129

had either a pre-kindergarten (PK) or kindergarten (K) program. The Common Core of Data Public

Elementary/Secondary School Universe Survey data was used to calculate the number of private schools

with PK or K programs. Using this data, a school was considered as having a pre-kindergarten if a) prekindergarten enrollment was greater than zero students, or b) the school reported that the lowest grade

offered was pre-kindergarten, but enrollment data were not provided. Similarly, a school was considered

as having a kindergarten if a) kindergarten enrollment was greater than zero, or b) the school reported that

the lowest grade offered was pre-kindergarten or kindergarten, but did not report kindergarten enrollment.

Again, the educational building age distribution found in CBECS and HUD (2003) was applied to the

total counts, resulting in the estimated 17,000 pre-1960, and 30,000 pre-1978 public schools.

2.8.2.2 Private Schools

This analysis used NCES’s Results from the 2003-2004 Private School Universe Survey report and the

underlying dataset to estimate the number of private schools with kindergartens and/or pre-kindergartens.

A school was considered as having a pre-kindergarten if a) pre-kindergarten enrollment was greater than

zero students, or b) the school reported that the lowest grade offered was pre-kindergarten, but enrollment

data were not provided. Similarly, a school was considered as having a kindergarten if a) kindergarten

enrollment was greater than zero, or b) the school reported that the lowest grade offered was prekindergarten or kindergarten, but did not report kindergarten enrollment. The previously cited CBECS

and HUD educational building age distribution was then applied to the private school universe to

calculate the number of private schools by age of construction. This adjustment yielded 9,000 pre-1960,

and 15,000 pre-1978 private schools.

For the purpose of the total cost analysis, private and public schools were categorized according to

whether they offered kindergarten only, kindergarten and pre-kindergarten, and pre-kindergarten only.

Table 2-29 uses information drawn from Table 2-9 and Table 2-16 to obtain the total number of schools

with each combination of programs. Table 2-9 and Table 2-16 indicate that there are 29,844 public

schools and 7,205 private schools with kindergarten programs only, for a total of 37,049 such schools.

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Table 2-9 and Table 2-16 also indicate that there are 20,885 public schools and 19,305 private schools

with both pre-kindergarten and kindergarten programs. Finally, there are a total of 1,400 public and 21

private schools with pre-kindergarten, but no kindergarten, which are accounted for as daycare centers for

the purposes of the analysis. Table 2-29 presents the total number of schools with kindergartens,

kindergartens and pre-kindergartens, and pre-kindergartens only by age of construction. Information

about the age distribution of buildings was taken from CBECS and HUD and applied to the data to give

estimates of the number of schools by the age of the building.

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Center for the Childcare Workforce and Human Services Policy Center. 2002. “Estimating the Size

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Farzad, Roben. “A Housing Boom Brings Jobs and Sometimes, Abuse.” The New York Times 07 July.

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Data. Received from Stephen Broughman (NCES) December 15, 2006.

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ons/4734/files/Number of Licensed

Programs 2005 pdf

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?pubid=2007309

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National Childcare Information Center. 2005. “Number of Licensed Facilities: 1991-2004.”

http://www.nara-licensing.org

U.S. Bureau of Labor Statistics. 2006. “Current Population Survey: Basic Monthly Survey.” January

2006.

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American Fact Finder. Available at:

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U.S. Census Bureau. 2004d. 2002 Economic Census: Industry Series: Drywall and Insulation Contractors

ECO2-231-238310. Available at: http://www.census.gov/prod/ec02/ec0223i238310.pdf

(Accessed 11/18/2006).

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11/18/2006).

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238350. Available at: http://www.census.gov/prod/ec02/ec0223i238350.pdf (Accessed

11/18/2006).

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ECO2-231-238150. Available at: http://www.census.gov/prod/ec02/ec0223i238150.pdf

(Accessed 11/18/2006).

U.S. Census Bureau. 2004h. 2002 Economic Census: Industry Series: Other Building Equipment

Contractors ECO2-231-238290. Available at:

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U.S. Census Bureau. 2004i. 2002 Economic Census: Industry Series: Other Building Finishing

Contractors ECO2-231-238390. Available at:

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U.S. Census Bureau. 2004j. 2002 Economic Census: Industry Series: Painting and Wall Covering

Contractors ECO-231-238320. Available at:

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U.S. Census Bureau. 2004k. 2002 Economic Census: Industry Series: Plumbing, Heating, and AirConditioning Contractors ECO2-231-238220. Available at:

http://www.census.gov/prod/ec02/ec0223i238220.pdf (Accessed 11/18/2006).

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238170. Available at: http://www.census.gov/prod/ec02/ec0223i238170.pdf (Accessed

11/18/2006).

U.S. Census Bureau. 2004m. 2002 Economic Census: Industry Series: Tile and Terrazzo Contractors

ECO2-231-238340. Available at: http://www.census.gov/prod/ec02/ec0223i238340.pdf

(Accessed 11/18/2006).

U.S. Census Bureau. 2004n. “Educational Services: Industry Series: Summary Statistics for the United

States: 2002.” American Fact Finder. Available at:

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_lang=en (Downloaded 11/13/2006).

U.S. Census Bureau. 2004p. “Other Technical and Trade Schools - Definition.” Census Data Information.

American Fact Finder. Available at:

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U.S. Census Bureau. 2004q. “Nonemployer Statistics.” Available at:

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12/4/2006).

U.S. Census Bureau. 2005a. “Sector 23: Construction: Industry Series: Selected Statistics for

Establishments by Value of Business Done: 2002.” American Fact Finder. Available at:

http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-ds_name=EC0223I06&-

_lang=en (Downloaded 11/13/2006).

U.S. Census Bureau. 2005b. “Sector 53: Real Estate and Rental and Leasing: Subject Series – Estab and

Firm Size: Employment Size of Establishments for the United States: 2002.” American Fact

Finder. Available at: http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-

ds_name=EC0253SSSZ2&-_lang=en (Downloaded 11/13/2006).

U.S. Census Bureau. 2005c. “Section 23: Construction: Industry Series: Detailed Statistics for

Establishments: 2002.” American Fact Finder. Available at:

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_lang=en (Downloaded 11/13/2006).

U.S. Census Bureau. 2005d. “Sector 62: Health Care and Social Assistance: Subject Series – Estab and

Firm Size: Employment Size of Establishments for the United States: 2002.” American Fact

Finder. Available at: http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-

ds_name=EC0262SSSZ2&-_lang=en (Downloaded 11/14/2006).

U.S. Census Bureau. 2005f. “Educational Services: Subject Series – Estab and Firm Size:

Receipts/Revenue Size of Firms for the United States: 2002.” American Fact Finder. Available at:

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_lang=en (Downloaded 11/13/2006).

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http://www.census.gov/econ/census02/data/us/US000_23.HTM (Accessed 12/1/2006).

U.S. Census Bureau. 2005i. 2002 Economic Census: Construction: By Industry. Available at:

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http://www.census.gov/econ/census02/data/us/US000_23.HTM (Accessed 8/3/2005).

U.S. Census Bureau. 2005j. “Sector 53: Real Estate and Rental and Leasing: Subject Series - Estab &

Firm Size: Revenue Size of Firms for the United States: 2002.” American Fact Finder. Available

at: http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0200A1&-

_skip=100&-ds_name=EC0253SSSZ4&-_lang=en. (Downloaded 12/19/2006).

U.S. Census Bureau. 2005k. “Nonemployer Statistics – Heatlh Care and Social Assistance – United

States.” http://www.census.gov/epcd/nonemployer/2002/us/US000_62.HTM. (Downloaded

3/24/2007).

U.S. Census Bureau. 2005m. 2002 Economic Census: Industry Series: Residential Remodelers ECO2-

23I-236118 (RV). Available at: http://www.census.gov/prod/ec02/ec0223i236118.pdf (Accessed

11/18/2006).

U.S. Census Bureau. 2006a. “Number of Establishments: General Definition.” Census Data Information.

American Fact Finder. Available at: http://factfinder.census.gov/servlet/MetadataBrowserServlet?

(Accessed 12/1/2006).

U.S. Census Bureau 2006b. “Annual Value of State and Local Construction Put in Place.” Available at:

http://www.census.gov/const/C30/state xls (Downloaded 12/8/2006).

U.S. Census Bureau 2006c. “Annual Value of Private Construction Put in Place.” Available at:

http://www.census.gov/const/C30/private xls (Downloaded 12/8/2006).

U.S. Census Bureau. 2006d. “Definitions of Construction.” Available at:

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U.S. Department of Commerce. 2006. Table 1.1.6. Real Gross Domestic Product, Chained Dollars. Last

revised: November 29, 2006.

U.S. Department of Education, Institute of Education Sciences. 2004. “Full-day and Half-day

Kindergarten in the United States: Findings from the Early Childhood Longitudinal Study,

Kindergarten Class of 1998-99” June 2004.

U.S. Department of Education, National Center for Education Statistics. Kindergarten Teachers: Public

and Private School Teachers of the Kindergarten Class of 1998–99, NCES 2004–060, by Elvira

Germino-Hausken, Jill Walston, and Amy H. Rathbun. Project Officer: Elvira Germino-Hausken.

Washington, DC: 2004.

U.S. Department of Energy. 2003. Commercial Buildings Energy Consumption Survey (CBECS).

U.S. Department of Housing and Urban Development (HUD). 2003. First National Environmental Health

Survey of Childcare Centers.

U.S. Environmental Protection Agency. 1996. “Lead; Requirements for Lead-Based Paint Activities in

Target Housing and Child-Occupied Facilities; Final Rule.” Federal Register.

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(Accessed 12/8/2006).

U.S. Environmental Protection Agency. 2009. “Economic Analysis for the Lead Renovation Repair, and

Painting Program Opt-Out and Recordkeeping Proposed Rule for Target Housing and Child

Occupied Facilities.”

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U.S. Environmental Protection Agency. 2006. “Economic Analysis for the Renovation, Repair and

Painting Program Proposed Rule”, February 2006.

U.S. Small Business Administration. 2006a. “Firm Size Data.” Available at:

http://www.sba.gov/advo/research/data html. (Accessed 11/30/2006).

U.S. Small Business Administration. 2006b. “Small Business Size Standards matched to North American

Industry Classification System.” Available at:

http://www.sba.gov/services/contractingopportunities/sizestandardstopics/tableofsize/SERV_TA

BLE_HTML html (Downloaded 11/24/2006).

U.S. Small Business Administration. 2008. “Small Business Size Standards matched to North American

Industry Classification System.” Available at:

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(Downloaded 7/29/2009).

Wilder Research Center. 2001. “Staff recruitment and retention in early childhood care and education and

school-age care.” April 2001.

Wilder Research Center. 2005. “Family, Friend and Neighbor Caregivers: Results of the 2004 Minnesota

statewide household childcare survey.” December 2005.

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3. Problem Definition: Residential Lead-Based Paint Hazards and the

Justification for Regulation

The purpose of this chapter is to provide background information on the existence of residential leadbased paint hazards and present an overview of the economic justifications for federal regulations to

address these problems. Section 3.1 characterizes the residential lead contamination problem and

discusses various sources of exposure. In Section 3.2, the regulatory background associated with

residential lead-based paint hazards is presented. Section 3.3 discusses how market failure due to

incomplete information and external costs result in inefficient levels of lead containment and control in

renovation activities, requiring regulatory intervention. Section 3.4 describes how the proposed rule will

address these market failures.

3.1 Lead Contamination Problem

Despite recent reductions in air, water, and food contamination, important sources of lead exposure

remain, due largely to the widespread presence of lead-based paint. Exposure to lead results in increased

blood lead levels associated with various adverse health effects, including reductions in IQ and other

negative cognitive effects, particularly in children. In addition, exposure to lead can result in a variety of

adverse health effects in adults.

3.1.1 Exposure Sources

As described in Chapter 5, lead may cause adverse health effects in any individual, exposed at any stage

of life (in utero through adulthood) (U.S. EPA 2005c). However, young children are particularly

susceptible to lead hazards because their central nervous systems are rapidly developing, and because

their behavior is likely to result in greater exposure to lead than older individuals experience.

Currently, the most significant high-dose source of lead exposure in children under school age is leadbased paint. Through the 1940's, paint manufacturers used lead as a primary ingredient in many oil-based

interior and exterior house paints. During the 1950's and 1960's, the usage gradually decreased as new

paints were developed, and in 1978 the Consumer Product Safety Commission (CPSC) ruled that paint

used for residences, toys, furniture, and public areas must not contain more than 0.06% lead by weight.

Nevertheless, about 50 percent of housing units and public and commercial buildings constructed before

1980 still contain lead-based paint (U.S. HUD 2000). Children’s exposure to lead from lead-based paint

is likely to be high when the paint is in a deteriorated state or is found on accessible, chewable, impact, or

friction surfaces, making the lead paint available to children who ingest paint chips. This “pica” behavior

appears to be rare, but is the likely cause of many of the highest blood lead levels observed in children.

Renovation activities can create lead-based paint hazards for children by making paint chips more

accessible for ingestion. These hazards can occur both within and outside the building unit being

renovated.

In addition to being a source of direct exposure, lead-based paint can be the source of lead contamination

in soil and dust. Children are exposed to lead from soil or dust in their homes as a result of typical handto-mouth activities. Lead-contaminated dust and soil are the major pathway through which most young

children are exposed to lead from lead-based paint hazards. Renovation activities increase the level of

lead dust in the facility and in the soil, thereby increasing the risk of lead ingestion in young children.

While occupational exposure is the primary exposure pathway to lead for adults, other common exposure

pathways for teenagers and adults include gardening, housework, drinking water and certain hobbies such

as creating objects from stained-glass and making pottery. Individuals (children, teenagers and adults) are

also exposed to a variety of other lead sources, some of which are localized in nature.

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Airborne lead is present in emissions from lead smelters, battery manufacturing plants, and solid waste

incinerators. The phase-out of leaded gasoline has substantially reduced airborne lead. Drinking water

may become contaminated with lead after it leaves the treatment plant. Although lead levels in drinking

water generally do not have a statistically significant effect on blood-lead concentrations as a result of

regulations stemming from the 1986 Safe Drinking Water Act, water is still considered an important

localized exposure source where lead solder and/or brass plumbing fixtures are present because of the

high absorption rate of lead in water. Lead exposure through food ingestion has declined greatly due to

the phase-out of lead-soldered food cans and public education. With these improvements in exposure

from air, water, and food, lead-based paint remains as the largest widespread source of lead exposure.

3.1.2 Lead from Renovation Activities

EPA exposure data (EPA 1997) indicate that renovation activities potentially increase both short-term and

long-term lead exposure levels. Lead concentrations are greatest in the area where the renovation work is

performed, but lead does settle into other areas of the building and potentially the surrounding area,

causing longer-term exposure. The study found that, with the exception of carpet removal and drilling

into plaster, all renovation activities examined deposited significant amounts of lead onto the floors in the

area where the work was being performed, ranging from 480 micrograms per square foot for sawing to

15,500 micrograms per square foot for paint removal. This lead may be ingested or inhaled by occupants

if proper containment and clean-up practices are not used. The study found that sweeping and shopvacuum clean-up, considered to be standard practice in the industry, reduced the total amount of lead

available to occupants. However, as the distance from the activity increased, the cleanup left a higher

percentage of the lead behind so that lead hazards remained following cleanup. These findings

demonstrate that these practices do not adequately reduce risks from lead dust generated by renovation

activities. Lead dust settled in carpeted areas or in soil is the most difficult to remove with simple broom

and vacuum clean-up and thereby creates the longest lasting exposure pathway for facility occupants.

EPA conducted a field study in 2007 (Characterization of Dust Lead Levels after Renovation, Repair, and

Painting Activities) (the ‘‘Dust Study’’) to characterize dust lead levels resulting from various renovation,

repair, and painting activities (EPA 2007). This study was designed to compare environmental lead levels

at appropriate stages after various types of renovation, repair, and painting preparation activities were

performed on the interiors and exteriors of target housing units and child-occupied facilities. All of the

jobs disturbed more than 2 square feet of lead-based paint, so they would not have been eligible for the

minor maintenance exception. The renovation activities were conducted by local professional renovation

firms, using personnel who received lead safe work practices training using the curriculum developed by

EPA and HUD, ‘‘Lead Safety for Remodeling, Repair, and Painting’’ (EPA 2003a). The activities

conducted represented a range of activities that would be permitted under the 2006 Proposal, including

work practices that are restricted or prohibited for abatements under 40 CFR 745.227(e)(6). Of particular

interest was the impact of using specific work practices that renovation firms would be required to use

under the proposed rule, such as the use of plastic to contain the work area and a multi-step cleaning

protocol, as opposed to more typical work practices.

In the Dust Study, 12 different interior and 12 different exterior renovation activities were performed at 7

vacant target housing units in Columbus, Ohio, and 8 vacant target housing units (including four

apartments) in Pittsburgh, Pennsylvania. Three different interior and three different exterior renovation

activities were conducted at a building representing a child-occupied facility, a vacant school in

Columbus. The presence of lead-based paint was confirmed by laboratory analysis before a building was

assigned a particular renovation activity or set of activities. Before interior renovation activities were

performed, the floors and windowsills in the work area and adjacent rooms were cleaned. In most cases,

pre-work cleaning resulted in dust lead levels on floors of less than 10 μg/ft2; nearly all floors were less

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than 40 μg/ft2 before work started. Most windowsills that would be used for later sampling were cleaned

to dust lead levels less than 250 μg/ft2. In the few cases where that level was not achieved on a

windowsill needed for sampling, dust collection trays were used. Interior renovation activities included

the following jobs:

 Making cut-outs in the walls.

 Replacing a window from the inside.

 Removing paint with a high temperature (greater than 1100 degrees Fahrenheit) heat gun.

 Removing paint with a low temperature (less than 1100 degrees Fahrenheit) heat gun.

 Removing paint by dry scraping.

 Removing kitchen cabinets.

 Removing paint with a power planer.

To illustrate the impact of the containment plastic and the specialized cleaning and cleaning verification

protocol that would be required by the 2006 Proposal, each activity was performed a minimum of four

times:

 With the plastic containment described in the 2006 Proposal followed by the cleaning protocol

described in the proposal.

 With the plastic containment described in the 2006 Proposal followed by dry sweeping and

vacuuming with a shop vacuum.

 With no plastic containment followed by the cleaning protocol described in the 2006 Proposal.

 With no plastic containment followed by dry sweeping and vacuuming with a shop vacuum.

Dust samples were collected after the renovation work was completed, after cleaning, and after cleaning

verification. If a building was being used again for the same job under different work practices, or for a

completely different job, the unit was recleaned and retested prior to starting the next job. All buildings

were cleaned and tested after the last job.

For the exterior jobs, plastic sheeting was placed on the ground to catch the debris and dust from the job,

in accordance with the requirements of the proposed rule. Additional plastic sheeting was laid out beneath

and beyond the ‘‘proposed rule’’ plastic. Trays to collect dust and debris were placed on top of and

underneath the ‘‘proposed rule’’ plastic. Trays were also placed just outside of the ‘‘proposed rule’’

plastic to assess how far the dust was spreading. A vertical containment, as high as the work zone, was

erected at the end of the additional plastic.

The use of the ‘‘proposed rule’’ plastic as a ground covering captured large amounts of leaded dust. For

all job types except removing paint with a torch, there was a substantial difference between the amount of

lead captured by the ‘‘proposed rule’’ plastic and the amount under the ‘‘proposed rule’’ plastic. The

2008 final LRRP rule was supported by the Dust Study discussed above. Therefore, EPA conducted a

peer review in accordance with OMB’s Final Information Quality Bulletin for Peer Review. EPA

requested this review from the Clean Air Scientific Advisory Committee (CASAC) Lead Review Panel.

The CASAC, which is comprised of seven members appointed by the EPA Administrator, was

established under the Clean Air Act as an independent scientific advisory committee. The CASAC’s

comments on the Dust Study, along with EPA’s responses, have been placed into the public docket for

this action. More information on the CASAC consultation process, along with background documents, is

available on EPA’s website at http://www.epa.gov/ lead/pubs/casac htm.

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According to the peer review report, the CASAC Panel found

“. . .that the [Dust Study] was reasonably well-designed, considering the complexity of the

problem, and that the report provided information not available from any other source. The study

indicated that the rule cleaning procedures reduced the residual lead (Pb) remaining after a

renovation more than did the baseline cleaning procedures. Another positive aspect of the Dust

Study was that it described deviations from the protocol when they occurred. “

The CASAC Panel also contended that the limited data from residential housing units and child-occupied

facilities included in the Dust Study, most likely do not represent a statistically valid sample of housing at

the national level. They noted that there are aspects of the study that would underestimate the levels of

lead-loadings while other aspects of the study would overestimate the loadings. EPA agrees that the Dust

Study is not nationally representative of all housing. EPA notes that there are several reasons why this is

the case, including the fact that all of the housing studied was built during 1925 or earlier, and a large

number of the floors were in poor condition. A major purpose of the Dust Study was to assess the

proposed work practices. A statistically valid sample of housing at the national level is not needed to

assess the work practices. If anything, the Dust Study is conservative with respect to the age of housing

because it studied older houses and therefore is appropriate for assessing the effectiveness of the work

practices.

3.2 Regulatory Background

This section outlines the extensive history of lead-based paint regulations at the federal level. Childhood

lead exposure continues to be a major public health problem among young children in the United States.

Most children with blood lead levels in excess of CDC’s current level of concern have been exposed to

lead in non-intact paint, interior settled dust, and dust and soil in and around deteriorating older housing

(CDC 2004). The nature and extent of the problems associated with lead-based paint in housing units

have been thoroughly investigated. Approximately 40% of all U.S. housing units (about 38 million

homes) have some lead-based paint. Use of lead safe work practices during renovation can advance the

goal of primary prevention of lead poisoning (CDC 2004).

3.2.1 The Federal Lead-based Paint Program

Title X and the Federal goal

Primarily in response to the persistent health threat posed by lead-based paint, in 1992 Congress enacted

Title X. Congress found that low-level lead poisoning was widespread among American children,

affecting, at that time, as many as 3 million children under age 6; that the ingestion of household dust

containing lead from deteriorating or abraded lead-based paint was the most common cause of lead

poisoning in children; and that the health and development of children living in as many as 3.8 million

American homes was endangered by chipping or peeling lead paint, or excessive amounts of leadcontaminated dust in their homes. Congress determined that the prior Federal response to this crisis was

insufficient and established, in Title X, a national goal of eliminating lead-based paint hazards as

expeditiously as possible. Congress decided that the Federal government would take a leadership role in

building the infrastructure necessary to achieve this goal.

The stated purposes of Title X are:

 To develop a national strategy to build the infrastructure necessary to eliminate lead-based paint

hazards in all housing as expeditiously as possible.

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 To reorient the national approach to the presence of lead-based paint in housing to implement, on

a priority basis, a broad program to evaluate and reduce lead-based paint hazards in the Nation’s

housing stock.

 To encourage effective action to prevent childhood lead poisoning by establishing a workable

framework for lead-based paint hazard evaluation and reduction and by ending the current

confusion over reasonable standards of care.

 To ensure that the existence of lead-based paint hazards is taken into account in the development

of Government housing policies and in the sale, rental, and renovation of homes and apartments.

 To mobilize national resources expeditiously, through a partnership among all levels of

government and the private sector, to develop the most promising, cost-effective methods for

evaluating and reducing lead-based paint hazards.

 To reduce the threat of childhood lead poisoning in housing owned, assisted, or transferred by the

Federal Government.

 To educate the public concerning the hazards and sources of lead-based paint poisoning and steps

to reduce and eliminate such hazards (Residential Lead-Based Paint Hazard Reduction Act of

1992).

EPA’s lead-based paint program

Under Title X, EPA is directed to take actions that can be divided into 4 key categories:

 Establishing a training and certification program for persons engaged in lead-based paint

activities, accrediting training providers, establishing work practice standards for the safe,

reliable, and effective identification and elimination of lead-based paint hazards, and developing a

program to address exposure to lead-based paint hazards from renovation and remodeling

activities.

 Ensuring that, for most housing constructed before 1978, lead-based paint information flows from

sellers to purchasers, from landlords to tenants, and from renovators to owners and occupants.

 Establishing standards for identifying dangerous levels of lead in paint, dust and soil.

 Providing information on lead hazards to the public, including steps that people can take to

protect themselves and their families from lead-based paint hazards. Each of these categories is

discussed in more detail in the following sections.

a. Training and certification, accreditation, and work practice standards. Title X added a new title to

TSCA entitled ‘‘Title IV Lead Exposure Reduction.’’ Most of EPA’s responsibilities for addressing leadbased paint hazards can be found in this title, with section 402 being one source of the rulemaking

authority to carry out these responsibilities. TSCA section 402(a) directs EPA to promulgate regulations

covering lead-based paint activities to ensure persons performing these activities are properly trained, that

training programs are accredited, and that contractors performing these activities are certified. These

regulations must contain standards for performing lead-based paint activities, taking into account

reliability, effectiveness, and safety.

On August 29, 1996, EPA promulgated final regulations under TSCA section 402(a) governing leadbased paint inspections, lead hazard screens, risk assessments, and abatements in target housing (U.S.

EPA 1996). TSCA section 401 defines ‘‘target housing’’ as any housing constructed prior to 1978,

except housing for the elderly or persons with disabilities (unless any child who is less than 6 years of age

resides or is expected to reside in such housing for the elderly or persons with disabilities) or any 0-

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bedroom dwelling. These regulations also apply to ‘‘child-occupied facilities,’’ which are defined at 40

CFR 745.223 as buildings constructed before 1978, or portions of such buildings, where children under

age 6 are regularly present. TSCA section 402 defines lead-based paint activities in target housing as

inspections, risk assessments and abatements. The 1996 regulations cover lead-based paint abatement

activities in target housing and child-occupied facilities, along with limited screening activities called lead

hazard screens. The regulations also established an accreditation program for training providers and a

certification program for individuals and firms performing these activities. Training providers who wish

to provide lead-based paint training for the purposes of the Federal lead-based paint program must be

accredited by EPA. Implementing regulations at 40 CFR 745.225 describe in detail the requirements for

each course of study, how training programs must be operated, and the process for obtaining

accreditation. Training programs must have a training manager with experience or education in a

construction or environmental field, and a principal instructor with experience or education in a related

field and education or experience in teaching adults. Training programs must also have adequate facilities

and equipment for delivering the training. To become accredited, an application for accreditation must be

submitted to EPA on behalf of the training program. The application must either include the course

materials and syllabus, or a statement that EPA model materials or materials approved by an authorized

State or Tribe will be used. The application must also include a description of the facilities and

equipment that will be used, a copy of the test blueprint for each course, a description of the activities and

procedures that will be used during the hands-on skills portion of each course, a copy of the quality

control plan, and the correct amount of fees. If EPA finds that the program meets the regulatory

requirements, it will accredit the training program for 4 years. To maintain accreditation, the training

program must submit an application and the correct amount of fees every 4 years.

Individuals and firms that perform inspections, lead hazard screens, risk assessments, or abatements in

target housing or child-occupied facilities must be certified. Certification requirements and the process

for becoming certified are described in 40 CFR 745.226. A firm that wishes to become certified must

submit an application, along with the correct amount of fees, attesting that it will use only certified

individuals to perform lead-based paint activities and that it will follow the work practice standards in 40

CFR 745.227. An individual who wishes to become certified must take an accredited training course in at

least one of the certified disciplines: Inspector, risk assessor, project designer, abatement worker, and

abatement supervisor. The risk assessor, project designer, and abatement supervisor disciplines have

additional requirements for education or experience in a construction or environmental field. The

inspector, risk assessor, and abatement supervisor disciplines also require the applicant to pass a

certification examination administered by a third party.

The regulations at 40 CFR part 745, subpart L, also contain work practice standards for performing

inspections, lead hazard screens, risk assessments and abatements in target housing and child-occupied

facilities. The regulations contain specific requirements for conducting paint sampling during an

inspection and specify information that must be gathered and samples that must be taken as part of a lead

hazard screen or risk assessment. The requirements for abatements are also set forth in the regulations.

When conducting abatements, an occupant protection plan must be prepared by a certified supervisor or

project designer; certain work practices such as open-flame burning, machine sanding or abrasive blasting

without high-efficiency exhaust control, dry scraping, and heat guns at high settings are prohibited; and a

visual inspection and dust clearance sampling must be performed after the abatement is finished to ensure

that the area is ready for re-occupancy. Any samples collected during any of these regulated lead-based

paint activities must be analyzed by a laboratory recognized by EPA as being capable of analyzing paint

chips, dust, and soil for lead. Requirements for inspection, lead hazard screen, risk assessment or

abatement reports are also described in this section

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Recognizing the importance of States and Territories in achieving the goal of eliminating lead-based paint

hazards in housing, Congress specifically directed EPA to establish a model State program and a process

for authorizing States to operate such programs in lieu of the Federal program. Concurrently with the

subpart L rulemaking in 1996, EPA codified, at 40 CFR part 745, subpart Q, a model training and

certification program and a process for enabling States, Territories, and Tribes to apply for authorization

to administer their own lead-based paint activity programs. Providing Indian Tribes with this opportunity

is consistent with EPA’s Policy for the Administration of Environmental Programs on Indian

Reservations (U.S. EPA 1984). EPA also provides grants under TSCA section 404 to States, Territories,

and Tribes to assist them in developing and administering these programs, as well as programs

implementing TSCA section 406(b). On June 9, 1999, the subpart L regulations were amended to include

a fee schedule for training programs seeking EPA accreditation and for individuals and firms seeking

EPA certification (U.S. EPA 1999). These fees were established as directed by TSCA section 402(a)(3),

which requires EPA to recover the cost of administering and enforcing the lead-based paint activities

requirements in unauthorized States. The most recent amendment to the subpart L regulations occurred

on March 20, 2009 (U.S. EPA 2009).

In addition, Congress directed EPA, in TSCA section 405, to establish protocols, criteria, and minimum

performance standards for analysis of lead in paint, dust, and soil. TSCA section 405 further directed

EPA, in consultation with HHS, to develop a program to certify qualified laboratories. The National Lead

Laboratory Accreditation Program (NLLAP) provides the public with a list of laboratories that have met

EPA requirements and demonstrated the capability to accurately analyze paint chip, dust, or soil samples

for lead. All laboratories recognized by NLLAP must pass on-site audits conducted by one of the two

accrediting organizations currently participating in NLLAP, the American Industrial Hygiene Association

(AIHA), and the American Association for Laboratory Accreditation. Recognized laboratories must also

perform successfully on a continuing basis in the Environmental Lead Proficiency Analytical Testing

(ELPAT) Program established by NIOSH, AIHA, and EPA.

The LRRP rule for target housing and COFs was promulgated in 2008 (73 FR 21692) and is codified in

Part 745 of Title 40 of the Code of Federal Regulations (CFR). The rule was promulgated under the

authority of §402(c) of the Toxic Substances Control Act (TSCA). Section IV of TSCA was established

by the Residential Lead-Based Paint Hazard Reduction Act of 1992, also known as Title X of the

Housing and Community Development Act of 1992, Public Law 102-550.

The 2008 LRRP regulation requires entities that perform renovation, repair and painting work for

compensation in buildings covered by the rule to become certified by EPA, ensure that their employees

are trained as either renovators or workers, and use lead-safe work practices when disturbing lead-based

paint.

b. Lead-based paint information for purchasers, renters, owners, and occupants of target housing.

Another of EPA’s responsibilities under Title X is to require that purchasers and tenants of target housing,

as well as occupants of target housing and parents of children in COFs undergoing renovation are

provided information on lead-based paint and lead-based paint hazards. As directed by TSCA section

406(a), CPSC, HUD, and EPA, in consultation with CDC, jointly developed a lead hazard information

pamphlet entitled ‘‘Protect Your Family From Lead in Your Home’’ (‘‘PYF’’) (U.S. EPA et al 2003b).

This pamphlet was designed to be distributed as part of the disclosure requirements of section 1018 of

Title X and TSCA section 406(b), to provide home purchasers, renters, owners, and occupants with the

information necessary to allow them to make informed choices when selecting housing to buy or rent, or

deciding on home renovation projects. The pamphlet contains information on the health effects of lead,

how exposure can occur, and steps that can be taken to reduce or eliminate the risk of exposure during

various activities in the home.

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Pursuant to the authority provided in section 1018 of Title X, on March 6, 1996, HUD and EPA jointly

promulgated regulations requiring persons who are selling or leasing target housing to provide the PYF

pamphlet and information on known lead-based paint and lead-based paint hazards in the housing to

purchasers and renters (HUD and U.S. EPA 1996). These joint regulations, codified at 24 CFR part 35,

subpart A, and 40 CFR part 745, subpart F, describe in detail the information that must be provided

before the contract or lease is signed and require that sellers, landlords, and agents document compliance

with the disclosure requirements in the contract to sell or lease the property. Title X does not provide for

these requirements to be administered by States or Tribes in lieu of the Federal regulations. Therefore,

HUD and EPA are responsible for administering and enforcing these disclosure obligations.

TSCA section 406(b) directs EPA to promulgate regulations requiring persons who perform home

renovations for compensation to provide a lead hazard information pamphlet to owners and occupants of

target housing being renovated. These regulations, promulgated on June 1, 1998, are codified at 40 CFR

part 745, subpart E (U.S. EPA 1998). The term ‘‘renovation’’ is defined, at 40 CFR 745.83, as the

modification of any existing structure, or portion of a structure, that results in the disturbance of painted

surfaces. Lead-based paint abatement projects are specifically excluded, as are small projects that disturb

2 square feet or less of painted surfaces, emergency projects, and renovations affecting components that

have been found to be free of lead-based paint, as that term is defined in the regulations, by a certified

inspector or risk assessor. Like the regulations regarding disclosure during sales or leases, these

regulations require the renovation firm to document compliance with the requirement to provide the

owner and the occupant with the PYF pamphlet. One important difference from the disclosure

requirements in section 1018 of Title X is that TSCA section 404 allows States to apply for, and receive

authorization to administer, the TSCA section 406(b) requirements. Two States are currently authorized

to operate this program.

c. Standards for lead in paint, dust, and soil. Another responsibility assigned to EPA by Title X is the

development of standards for identifying dangerous levels of lead in paint, dust and soil. These standards,

promulgated pursuant to TSCA section 403 on January 5, 2001 and codified at 40 CFR part 745, subpart

D, provide various Federal agencies, including HUD, and State, local and Tribal governments with

uniform benchmarks on which to base decisions on remedial actions to safeguard children and the public

from lead-based paint hazards (U.S. EPA 2001b). These standards also allow certified inspectors and risk

assessors to easily determine whether a particular situation presents a lead-based paint hazard and whether

to recommend remedial actions such as lead-based paint abatement, cleaning of dust, or removal of soil.

The standards define lead-based paint hazards in target housing and child-occupied facilities as paint-lead,

dust-lead, and soil-lead hazards. A paint-lead hazard is defined as any damaged or deteriorated leadbased paint, any chewable lead-based painted surface with evidence of teeth marks, or any lead-based

paint on a friction surface if lead dust levels underneath the friction surface exceed the dust-lead hazard

standards. A dust-lead hazard is surface dust that contains a mass-per-area concentration of lead equal to

or exceeding 40 micrograms per square foot (μg/ft2) on floors or 250 μg/ft2on interior windowsills based

on wipe samples. A soil-lead hazard is bare soil that contains total lead equal to or exceeding 400 parts

per million (μg/g) in a play area or average of 1,200 parts per million of bare soil in the rest of the yard

based on soil samples.

d. Public outreach and education. Among other things, TSCA section 405(d) directs EPA, along with

the Agency for Toxic Substances and Disease Registry (ATSDR) and HUD, to sponsor public education

and outreach activities to increase public awareness of the health effects of lead, the potential for

exposures, the importance of screening children for elevated blood lead levels, and measures that can be

taken to reduce or eliminate lead-based paint hazards. Accordingly, EPA has worked to provide the

public with information and increase public awareness of such matters. To date, these activities have

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included web site management, development of public outreach strategies, development of partnership

agreements, distribution of materials, participation in national conferences and exhibits, and developing

hazard information documents (and other media, such as videos), as necessary to implement Title X. EPA

has collaborated closely with other Federal agencies and its State, Tribal, and local government partners

in developing outreach campaigns. EPA has also been involved in developing model tool kits of various

educational tools to provide to partners, such as slogans and graphic materials for public buses, trains, and

mass transit stations.

TSCA section 405(e) further directs EPA to establish, in connection with HUD, CDC, other Federal

agencies, and State and local governments, a clearinghouse for information on lead-based paint and a

hotline for the public to use for questions and requests for information on lead-based paint. This

clearinghouse, the National Lead Information Center, handles approximately 50,000 calls per year, and

disseminates up to 500,000 documents per year to the public.

Lead-based paint programs at other Federal agencies

In addition to EPA, other Federal agencies have important roles in achieving the goals of reducing or

eliminating lead-based paint hazards in housing. Other agencies specifically assigned tasks in Title X

include HUD, CDC, and OSHA.

The Federal agencies have long realized that they must work together to develop and implement Federal

strategies for addressing lead-based paint hazards in order to be efficient and effective. In 1989, HUD

and EPA formed an inter-agency task force to work through issues associated with lead-based paint

abatement. The Federal Interagency Lead Based Paint Task Force has remained active throughout the

years and continues to meet on a quarterly basis. Participating agencies include the Department of

Defense, the Veterans Administration, the National Institute of Standards and Technology (NIST), the

U.S. Public Health Service, the National Aeronautics and Space Administration (NASA), the United

States Department of Agriculture (USDA), the Government Accountability Office (GAO), the National

Institute for Environmental Health Sciences (NIEHS), ATSDR, CDC, CPSC, NIOSH, OSHA, HUD, and

EPA. This Task Force serves as an important forum for coordinating the strategic plans of the Federal

agencies who have responsibilities under Title X or who have responsibilities for maintaining and

disposing of property that may contain lead-based paint.

Title X assigned certain responsibilities to HUD. One of HUD’s functions is the administration of the

Lead-Based Paint Hazard Control Grant Program established by the Act. This program provides grants of

$1 million to $3 million to State and local governments for control of lead-based paint hazards in

privately owned, low-income owner-occupied and rental housing that is not receiving federal assistance.

These grants are also designed to stimulate the development of a trained and certified hazard evaluation

and control industry. Evaluation and hazard control work funded by the program must be conducted by

either contractors who are certified by EPA or an EPA-approved State or Tribal program, or by

contractors trained in lead-safe work practices, in the case of interim controls. Through these

requirements, HUD hopes to create infrastructure that will last beyond the life of the grant. In awarding

grants, HUD promotes the use of cost-effective approaches to hazard control that can be replicated across

the nation. Since 1993, approximately $971 million has been awarded to over 200 local and State

jurisdictions across the country. The work approved to date will lead to the control of lead-based paint

hazards in more than 70,000 homes where young children reside or are expected to reside. Other HUD

lead grant programs include the Lead Hazard Reduction Demonstration program, the Lead Elimination

Action Program (LEAP), the Lead Outreach program and the Lead Technical Studies program.

HUD was also given regulatory authority over some aspects of lead based paint hazard control. As noted

previously, on March 6, 1996, HUD and EPA jointly promulgated regulations requiring the disclosure of

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lead-based paint information during sale or lease transactions involving target housing. The HUD

disclosure regulations are codified at 24 CFR part 35, subpart A. Subparts B through R of 24 CFR part

35 are known as the ‘‘Lead Safe Housing Rule,’’ initially promulgated on September 15, 1999, and

updated in June 2004 (HUD 2004b). This rule was designed to protect young children from lead-based

paint hazards in target housing that is being sold by the Federal government or receives financial

assistance from the government. The requirements generally depend upon the level of assistance being

provided, and may include such things as inspections, risk assessments, abatement, paint stabilization, or

interim controls, which are temporary measures to reduce potential exposure to lead-based paint hazards.

The emphasis is on reducing lead-based paint hazards, so, after paint is disturbed, a visual assessment for

surface dust, debris, and residue and dust clearance testing is required to ensure that no dust lead hazards

were created or left in the work area or, for rehabilitation projects of moderate or substantial scope, in the

entire housing unit. More information on the Lead Safe Housing Rule is available on the HUD website at

http://www.hud.gov/offices/lead.

Section 1017 of Title X required HUD to issue ‘‘guidelines for the conduct of federally supported work

involving risk assessments, inspections, interim controls, and abatement of lead-based paint hazards.’’ In

response to this directive, HUD completed the Guidelines for the Evaluation and Control of Lead-Based

Paint Hazards in Housing (Guidelines), in June 1995 (HUD 1995). The Guidelines provide detailed,

comprehensive, technical information on how to identify lead-based paint hazards in housing and how to

control such hazards safely and efficiently.

Other core activities of HUD’s lead-based paint program include providing technical assistance to

housing authorities, nonprofit housing providers, local and State agencies, other Federal agencies, housing

developers, inspectors, real estate professionals, contractors and financiers, and public health authorities;

evaluating the hazard reduction methods used in the grant program to measure their effectiveness, cost

and safety; and maintaining a community outreach program in coordination with the other Federal

agencies involved in lead-based paint hazard reduction.

CDC also provides significant funding for the prevention of childhood lead poisoning. CDC provides

funding to support State, city and county programs in the areas of primary prevention, case management

and screening, surveillance, strategic partnerships, and program evaluation. Since 2002, CDC has

recommended that a blood lead level of 10 micrograms per deciliter (μg/dL) be used as a threshold for

individual intervention (CDC 2002). Additional CDC recommendations address the type and intensity of

individual intervention strategies that should be undertaken, depending upon the child’s blood lead level.

These strategies range from nutritional and educational interventions, along with more frequent testing,

for a child with a blood lead level of 10–14 μg/dL, to medical and environmental interventions for

children with blood lead levels above 45 μg/dL (CDC 2002). CDC has established a national surveillance

system for children with elevated blood lead levels. In addition, CDC works with HUD and EPA to

coordinate outreach and education campaigns.

OSHA is another agency with regulatory authority under Title X. As directed by the Act, OSHA

promulgated an interim final standard on May 4, 1993, which regulates lead exposures in the construction

industry (OSHA 1993). This standard, codified at 29 CFR 1926.62, limits worker exposures to 50

micrograms of lead per cubic meter of air averaged over an 8–hour workday. Employers must use a

combination of engineering controls and work practices to reduce employee exposure as much as

possible, using appropriate respiratory protection where necessary to achieve the exposure limit.

Employees must receive training on the health effects of lead and how to limit exposure through proper

work practices and personal protective equipment. Exposure monitoring and medical monitoring,

including blood lead testing, are also required. This standard remains in effect and OSHA retains the

authority to protect workers from occupational exposure to lead.

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Many Federal agencies have been working to reduce or eliminate lead-based paint hazards in housing and

to end lead poisoning. EPA, HUD, and other Federal agencies have been working for many years on the

problem of lead-based paint hazards that can be created during renovation and remodeling activities in

housing and child-occupied facilities. This rulemaking is an important component of the Federal strategy

for eliminating lead poisoning.

3.3 Justification for Federal Regulations of Lead Exposure during Renovation

3.3.1 Market Failure

Market failure is one of the conditions that can justify government regulation. Market failures can result

when one or more of the following conditions are met:

 poorly defined property rights (such as negative externalities, common property resources, and

public goods);

 imperfect markets for trading property rights (because of a lack of perfect information or of

contingent markets;

 monopoly power;

 distortionary taxes and subsidies and other inappropriate government regulations); and

 the divergence of private and social discount rates.

The occurrence of any of these conditions justifies further inquiry into the need for government regulation

to reduce inefficiencies in the allocation of society’s resources. This section considers whether any of

these conditions are linked to lead exposures resulting from renovation in target housing and public or

commercial building COFs. If so, understanding the nature of the inefficiencies involved facilitates the

design of more effective regulations. The specific regulatory approach considered here involves requiring

dust sampling and clearance testing following certain renovation activities.

Economic efficiency suggests that in the absence of regulation dust sampling and clearance testing

following renovation will occur as long as the property owners’ willingness-to-pay for reduced lead risks

exceeds the cost of reducing these risks. If the property owners are aware of the risks and of the

availability and costs of reducing these risks, then arguably they might be able to accurately trade off risk

and cost without the aid of government regulation. However, there are two arguments for why individual

property owners may not trade off risk and cost efficiently: (1) because externalities exist, and (2) because

of inadequate information.

Externalities and Public-Good Characteristics of Lead-Safe Renovation

One potential cause of market failure for dust sampling and clearance testing following renovations stems

from externalities. An efficient outcome is achieved when the marginal willingness-to-pay for a service is

equivalent to the marginal cost of providing that service. In the case of renovation in a rental unit, the

primary beneficiaries of lead-safe renovation are the occupants; however, the decision about whether or

not to pay for dust sampling or clearance testing is made by the property owners or managers who have

an insufficient incentive to take the benefits to their occupants into account when making this decision.

Externalities also exist in the case of renovation events in owner-occupied homes. Because dust sampling

and clearance testing following renovation in an owner-occupied unit is likely to benefit not only the

consumer of the renovation (the homeowner and his or her family members) but also residents of adjacent

properties, future occupants, visitors, and children receiving child care on the premises; lead-safe

renovation services are, in part, a public good. As such, even with perfect information, the maximum

amount that the individual consumer of the renovation would be willing to pay for lead-safe work is likely

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economic justification for a regulation is

the existence of an inefficiency in the

allocation of resources This inefficiency

is commonly known as a market failure

since the market is the mechanism used to

allocate resources efficiently

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to be lower than the total amount that that particular consumer plus the other beneficiaries (tenants,

neighbors, future occupants, etc.) would be willing-to-pay for the service. For example, a future occupant

of a housing unit for sale may experience an increased exposure to lead if a renovation that creates a lead

hazard is performed before they move in. While a future occupant might be willing to pay to reduce or

eliminate this exposure, they would not be consulted by the property owner making the decision. As

another example, children cannot express their willingness-to-pay for risk reduction and rely on their

parents’ or the property owners’ willingness-to-pay. Even if other parties were consulted, the transaction

costs of reaching an agreement would be high, leading to an inefficient process.

Another example of an externality is associated with an owner’s decision regarding which contractor to

hire to perform renovation in his or her housing unit. Contractors that perform dust sampling or clearance

testing following a renovation are likely to charge more for their work than establishments that do not

perform this testing. This testing may also increase the duration of the project because dust wipe testing

takes time, and because contractors may need to perform additional cleaning. Since the property owner

pays for the renovation, but not necessarily for the consequences of all the resulting lead exposure, he or

she is faced with powerful short-term incentives (lower cost and a faster turn-around) to hire a contractor

that does not perform dust sampling or clearance testing. Other parties (such as tenants, future occupants,

visitors, and children receiving child care and their parents) pay for the consequences of lead exposures,

not the property owner. This externality results in the socially inefficient outcome of too little dust

sampling and clearance testing services being purchased.

Inefficiencies also exist on the supply side of this market. Renovators that perform dust sampling or

clearance testing incur higher costs than other contractors who are faced with incentives to keep their

costs as low as possible. Similar to property owners, contractors may not incur the costs of consumer

lead exposure resulting from unsafe renovation work.

Because the legal system is not perfect, the contractor’s financial responsibilities (in terms of liability

costs related to customer lead exposure) are not clear and consistently enforced. The same situation

occurs with respect to a property owner’s responsibilities to tenants, future occupants, visitors, and childcare customers. This situation is likely to result in an inefficient outcome of too little dust sampling and

clearance testing services being consumed.

Inadequate Information

Another cause of market failure associated wth lead-safe work practices is due to inadequate information.

Correct information is an important prerequisite to the demand for dust sampling or clearance testing

following renovation projects. In deciding whether dust sampling or clearance testing are worth the extra

cost, the property owner must know whether there is lead in the work area, what risks are implied by

having renovation done in areas with lead-based paint, the significance of these risks, what can be

accomplished in reducing those risks, and how much these risk reductions cost. On the supply side,

contractors may be unaware of the risks they are creating.

Misinformation can lead to inefficient outcomes. Without knowing there is a lead problem, or how

renovation might create lead hazards, the owner will have too low a demand for dust sampling or

clearance testing and may be unwilling to pay additional costs for contractors to perform the testing.

Furthermore, a great deal of uncertainty can exist if the consumer is unsure about the quality of lead-safe

renovation services being purchased and their likely benefits. If consumers do not have any guarantee

that contractors are qualified to identify and control lead-based paint hazards, demand for these services is

likely to be lower than in the presence of such a guarantee. Under the proposed LRRP Clearance Rule

additional information will be available to property owners on the effectiveness of prospective contractors

at minimizing risks from lead-based paint hazards. Specifically, property owners will be able to judge the

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contractors may be unaware of the risks

they are creating and the methods they

can use to reduce risks of lead exposure

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past performance of contractors through referrals from family, friends and neighbors, by checking

references, and by reading contractor reviews available through online contractor referral websites. As a

result of the proposed LRRP Clearance Rule, demand is likely to increase for those contractors who

develop reputations for completing renovation work without leaving high levels of lead dust behind.

Customer satisfaction is particularly important for the renovation industry, an industry where most firms

report that over 50 percent of revenues are attributable to referrals and some firms report that up to 90

percent of their revenues are attributable to referrals (NARI, undated). Furthermore, if individual

consumers are satisfied with a contractor’s work, they are more likely to hire that same contractor for

additional work in the future. If a contractor leaves behind high dust levels, the consumer may choose to

hire a different contractor for future work.

The proposed LRRP Clearance Rule provides additional information to two groups: (1) renovation firms

and their employees, and (2) owners and occupants of renovated structures. The proposed rule will

provide additional information to renovation firms and their employees about the effectiveness of the

containment and cleaning practices they are employing. Specifically, dust wipe test results that exceed

dust hazard levels indicate that the containment and cleaning practices employed were inadequate while

results showing no dust-lead hazards indicate that the containment and cleaning practices employed were

adequate. Renovation firms can be expected to improve their effectiveness and efficiency for achieving

dust wipe test results below dust-lead hazard levels as they receive feedback on the effectiveness of their

work practices.

Property owners and occupants will also be provided with additional information under the proposed rule.

The proposed LRRP Clearance Rule will enhance a consumer’s ability to select a renovation firm with a

record of achieving low dust-lead levels. For example, potential renovation consumers would be able to

ask renovation firm references or the firms themselves about their record for achieving low dust-lead

levels dust wipe test results, as demonstrated by dust wipe test results. After the work is completed

property owners and occupants will be provided information about dust-lead levels after renovation work

has been performed. This information will provide owners and occupants with a greater understanding

and awareness of dust-lead levels, which has value because it provides owners and occupants with a

greater ability to make further risk management decisions. In addition, owners and occupants are more

likely to provide positive referrals for those contractors that completed the work without leaving behind

high levels of lead dust, creating extra incentives for renovation firms to minimize lead dust levels.

Impacts of the Regulation on Demand for Lead-Safe Renovation Services

A consumer’s demand for renovation services is a function of the price of these services, the

characteristics of the services (e.g., quality, lead safety etc.), and consumers’ own characteristics. For the

purpose of illustration, assume that all renovation services are identical except that some are performed

using lead-safe containment and clean-up practices with dust sampling and some are not. Further assume

that there is only one consumer and one supplier in the market. Of the services that are performed

without lead-safe practices, some are done by the supplier, while others are do-it-yourself projects

performed by the consumer. The general market failure relationships discussed above are illustrated in

Exhibit 3-1 as three markets for close substitutes. Figure (a) represents the market for lead-safe

renovation projects, Figure (b) represents the professional market for “standard practice” renovations that

do not use lead-safe work practices, and Figure (c) represents the do-it-yourself market for “standard

practice” renovations. In each market, S0 represents the supply of renovation services and D0 represents

the demand for renovation services in the baseline with incomplete information. Note that, moving from

left to right, each supply curve is lower than the prior one, corresponding to the lower cost in terms of

materials and time combined. The area under the demand curve in each market represents the consumer’s

willingness-to-pay for renovation services.

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hazards exist

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Chapter 3 3-14

Exhibit 3-1: Impact of Regulation on Markets for Renovation/Remodeling Services

S0

D1

Work Practices

Figure (b) Professional Market with

“Standard” Work Practices

QLead-Safe QStandard Professional

PLead-Safe

PStandard Professional

D0

S0

Q Standard Do-it-yourself

?

Figure (c) Do-it-Yourself Market with

“Standard” Work Practices

P0

PStandard Do -it-yourself

D0

S1

D0

D1

S0

S1

Q0 Q1

P0

P1

Q0

P0

P1

Figure (a) Market with Lead-Safe

Q1 Q0

S0

D1

Work Practices

Figure (b) Professional Market with

“Standard” Work Practices

QLead-Safe QStandard Professional

PLead-Safe

PStandard Professional

D0

S0

Q Standard Do-it-yourself

?

Figure (c) Do-it-Yourself Market with

“Standard” Work Practices

P0

PStandard Do -it-yourself

D0

S1

D0

D1

S0

S1

Q0 Q1

P0

P1

Q0

P0

P1

Figure (a) Market with Lead-Safe

Q1 Q0

The proposed LRRP Clearance Rule alters the nature of these three markets by providing additional

information to the consumer and contractor about the risk associated with lead-based paint renovation

activities and by requiring that clearance standards are met following certain renovations. The

implementation of the LRRP program will help to establish a more structured market for lead-safe

renovation services. Prior to April 2010 when the LRRP program first took effect, consumers of

renovation services generally had no guarantee that a contractor who claimed to provide lead-safe

renovation services would actually perform the project in a lead-safe manner. The 2008 LRRP rule,

which is now part of the baseline for the renovation industry, provides some assurance to consumers

about the quality of work provided by certified renovators, through the implementation of work practice

standards and training/certification requirements The proposed LRRP Clearance Rule builds on the 2008

rule to provide additional assurances to consumers about the quality of work provided by certified

renovators, by providing quantitative information on the lead dust levels they leave behind.

EPA’s targeted outreach program is also likely to increase demand for lead-safe renovation services by

raising consumer awareness about the dangers of unsafe work. Thus, demand for lead-safe renovation

activities may shift with EPA’s outreach campaign or due to the provision of information about lead

hazards and risks before a consumer sign a contract with a renovator.

Although contractors that currently provide well-trained staff and perform lead-safe work practices are

expected to find it in their vested interest to provide the kinds of information cited above, this possibility

has not closed the information gaps for the public. One impediment may be public uncertainty about the

reliability of information that contractors themselves provide in the absence of the proposed LRRP

Clearance Rule. Their information may be considered unreliable because consumers are not fully

competent to assess the lead contamination and what needs to be done, because the businesses are subject

to moral hazard (which occurs, for example, because businesses have a financial interest in minimizing

their work practice costs), or both. Since many property owners may lack easy access to independent

sources of information to motivate their decisions, doing nothing may be the likely response. The

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consumers and renovators in order

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proposed LRRP Clearance Rule aims to reduce public uncertainty by providing quantitative information

to consumers about prospective renovation firms’ abilities to minimize dust lead levels. For example,

before hiring a contractor a consumer can ask firm references or the firms themselves to provide

information about their past performance in minimizing post-verification dust-lead levels. Consumers

and firms might also choose to set contract terms or prices that are contingent on the post-verification

dust-lead levels, reducing renovation firms’ incentives to lower work practice costs in a manner that

might increase the likelihood of leaving a dust lead hazard behind.

The increased demand discussed above is shown by an upward shift of the demand curve in Figure (a)

from D0 to D1 and an associated increase in price. Simultaneously, the demand for “standard practice”

renovation services decreases with an associated decrease in price. Given scarce resources for

enforcement, it is expected that some “standard practice” professional work will continue, even in

properties where there is the potential for lead exposure. The effect of the regulation on the do-it-yourself

market is ambiguous. Some property owners that might have hired a professional to perform “standard

practice” renovation work in the baseline may decide to perform this work themselves rather than pay the

additional costs for lead-safe work practices. This action would shift the supply curve back up. On the

other hand, with increased information, property owners that would have performed do-it-yourself

“standard” practice” renovation in the baseline may decide to either forgo renovation altogether or hire a

lead-safe professional, thus reducing do-it-yourself demand.

Impacts of the Regulation on the Supply of Lead-Safe Renovation Services

The proposed LRRP clearance rule will increase both the cost of supplying lead-safe services and

standard services. In Figures (a) and (b), S1 represents the supply of services with the regulations. Many

firms performing lead-safe renovations will incur additional costs associated with having third party dust

sampling performed (or training dust sampling technicians and performing their own dust sampling), and

may incur costs for re-cleaning where clearance is required. A contractor that continues to provide

standard (not lead-safe) renovation services will have higher costs of operation due to potential

enforcement actions and potentially higher liability. The relative size of the shifts in the two submarkets

will affect the final changes in quantity and price of both lead-safe and standard renovation services.

The net impact on the quantity of renovation projects performed is also ambiguous. If all property owners

are willing to pay the full amount for lead-safe work practices, then the total quantity performed across all

three markets will remain constant but the average price will rise. However, if some property owners are

not willing to pay for the risk reduction they may chose to forgo renovation services altogether, resulting

in a net decline in renovation services provided after regulation.1

Conclusions

As demonstrated in this section, due to inadequate information and the existence of externalities, the

quantity of lead-safe RRP services currently provided is likely to be inefficiently low. Failure in the

market for lead-safe RRP services is significant in both qualitative and quantitative terms. Childhood

lead exposure continues to be a major public health problem among young children in the United States.

From 1999 to 2002, approximately 310,000 children aged 1 to 5 years, had blood-lead levels greater than

10 μg/dL, despite the removal of lead from gasoline and a ban on lead-based paint in 1978 (CDC 2005).

Most children with blood-lead levels in excess of CDC’s current level of concern have been exposed to

1 The amount by which price and quantity change in each of these markets is a function of both the amount by which

the supply and/or demand functions shift and the relative elasticities of the two functions. See Appendix 3A for

a discussion of how these factors affect the price of renovation services and the quantity provided by the

market. Appendix 3B presents price elasticity estimates for construction and RRP.

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lead in non-intact paint, interior settled dust, and dust and soil in and around deteriorating older housing

or other buildings where they spend time. According to the Center for Disease Control (CDC),

“renovation and remodeling activities that disturb lead-based paint can create substantial amounts of lead

dust in the home; such dust can then be inhaled or ingested by children” (CDC 1997). An insufficient

number of lead-based paint interventions have occurred to remove the dangers posed by uncontrolled

renovation activities; renovation activity thus continues to pose a significant risk of lead exposure.

3.3.2 Justification for Regulation at the Federal Level

In the Residential Lead-Based Paint Hazard Reduction Act of 1992 (Title X), the United States Congress

stated that the elimination of lead-based paint hazards was a national goal. Under §402, Congress

directed EPA to promulgate regulations governing lead-based paint activities to ensure that individuals

are properly trained, that training programs are accredited, and that contractors engaged in such activities

are certified; and to promulgate guidelines for the conduct of such renovation and remodeling activities

which may create a risk of exposure to dangerous levels of lead. Accordingly, the 2008 LRRP rule

established training, certification and accreditation requirements as well as work practice requirements for

renovation work in target housing and COFs.

The proposed rule revises the LRRP program by requiring dust wipe testing and clearance testing

following certain renovations. Since both of these provisions revise the existing Federal RRP regulation,

it is appropriate that the changes be made at the Federal level, instead of the state or local level.

3.4 Approaches for Reducing Lead Exposure Resulting from Renovation

This section examines how the information provision and the mandatory training and work practice

requirements in the proposed rule address the market failures discussed in the previous section.

3.4.1 Information Provision

Information provision will occur in several ways under the LRRP program in conjunction with other

sections of Title X. Consumers will be directly informed about lead-based paint hazards and risks

associated with renovation work through educational programs, expanded notification requirements, and

quantitative information about dust-lead hazards provided after dust wipe testing and clearance. The aim

of these programs will be to educate the property owner about the risks associated with lead-based paint

and lead-based paint hazards and having renovation work done in areas where these are present, the

significance of these risks, and how specific work practices can reduce those risks. In addition, requiring

training of professionals who carry out renovation projects and perform dust wipe testing will provide

these individuals information about the hazards of lead exposure and the use of appropriate procedures to

reduce exposure during their work. Similarly, the firm certification process will act as an indirect form of

information provision to the consumer by assuring them that the services they are purchasing will reduce

or eliminate lead exposure.

The proposed rule addresses market failure due to inadequate information in two ways. First, it will

enable consumers to more accurately judge the qualifications of renovation firms before entering into a

contract because of additional information that will be available as a result of the rule. In addition, they

will have more complete information about the quality of the work that was performed at the completion

of the job. Owners and occupants who have more complete information about dust lead standards will

have an enhanced ability to make further risk management decisions. Second, it provides a feedback

mechanism for renovation firms that is expected to result in improvements in the effectiveness and

efficiency of their containment and cleaning practices. Both of these information provision activities are

described below.

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Effect of Dust Wipe Testing and Clearance Requirements

The objective of requiring dust wipe testing and clearance following certain renovations is to reduce

exposure to lead dust generated by renovation projects and thereby protect children and adults from the

health hazards posed by lead. Due to the nature of the problem, uncertainty currently exists on the part of

consumers about the quality of lead-safe renovation services and their likely benefits. The lack of

information regarding the benefits of and the lack of confidence in the quality of a good or service

generally leads to a lower demand and a lower willingness-to-pay for that good or service. Thus, if

consumers of renovation services are not aware of the dangers posed by lead dust generated during

renovation, or if they are not confident that a contractor who claims to use lead-safe work practices has

been properly trained, they may not be willing to pay the additional costs of contractors who voluntarily

abide by these work practice standards. Requiring dust wipe testing and clearance following renovations

will provide consumers with more complete information about the effectiveness of the lead safe work

practices that were used. Under the proposed LRRP Clearance Rule additional information will be

available to property owners on the effectiveness of prospective contractors at minimizing risks from

lead-based paint hazards. Specifically, property owners will be able to judge the past performance of

contractors through referrals from family, friends and neighbors, by checking references, and by reading

contractor reviews available through online contractor referral websites. As a result of the proposed

LRRP Clearance Rule, demand is likely to increase for those contractors who develop reputations for

completing renovation work without leaving high levels of lead dust behind. Customer satisfaction is

particularly important for the renovation industry, an industry where most firms report that over 50

percent of revenues are attributable to referrals and some firms report that up to 90 percent of their

revenues are attributable to referrals (NARI, undated). In addition, renovation consumers and firms would

have the option to set contract terms or prices that are contingent on the dust wipe test results at the end of

a job. An example of the market failure stemming from inadequate information is presented in the

previous section and is shown graphically in Exhibit 3-1.

Exhibit 3-1: Impact of Regulation on Markets for Renovation/Remodeling Services

S0

D1

Work Practices

Figure (b) Professional Market with

“Standard” Work Practices

QLead-Safe QStandard Professional

PLead-Safe

PStandard Professional

D0

S0

Q Standard Do-it-yourself

?

Figure (c) Do-it-Yourself Market with

“Standard” Work Practices

P0

PStandard Do -it-yourself

D0

S1

D0

D1

S0

S1

Q0 Q1

P0

P1

Q0

P0

P1

Figure (a) Market with Lead-Safe

Q1 Q0

S0

D1

Work Practices

Figure (b) Professional Market with

“Standard” Work Practices

QLead-Safe QStandard Professional

PLead-Safe

PStandard Professional

D0

S0

Q Standard Do-it-yourself

?

Figure (c) Do-it-Yourself Market with

“Standard” Work Practices

P0

PStandard Do -it-yourself

D0

S1

D0

D1

S0

S1

Q0 Q1

P0

P1

Q0

P0

P1

Figure (a) Market with Lead-Safe

Q1 Q0

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The proposed rule will provide additional information to renovation firms and their employees about the

effectiveness of the containment and cleaning practices that they are employing. This feedback

mechanism is likely to result in more effective and efficient containment and cleaning practices.

If renovators were not mandated to provide this information to consumers, responsible renovators might

theoretically provide it voluntarily (although renovators who are not as responsible are unlikely to provide

this information voluntarily). But there is no evidence that even responsible renovators are doing this.

The failure of the marketplace to provide this information on its own means that owners and occupants

may not be able to react appropriately to avoid or prevent risks from lead-based paint.

3.4.2 Mandatory Training and Work Practice Requirements

The information provision described above will aid in reducing the extent of the market failure that

currently exists for lead-safe renovation services. However, relying solely on information provision is

unlikely to be sufficient to correct the market failure because of the nature of the lead paint problem. The

lead in lead-based paint cannot be seen on visual inspection, therefore, the owner and occupant do not

know if lead is present and whether a lead exposure hazard exists. Likewise, the adverse health effects

are not noticeable for several years and the source may not be recognized. In such situations, education

may not be sufficient and other mechanisms are needed to ensure that if a potential risk exists, it is

suitably addressed. The LRRP program introduces other mechanisms for the elimination of lead-based

paint hazards during renovation work. These include training requirements for personnel engaged in

renovation work, dust wipe testing, and clearance. Work practice requirements include the use of

standard practices for the containment and cleanup of lead dust and debris generated during the project,

the prohibition or restriction of certain high-hazard techniques, and the use of standard requirements for

performing dust wipe sampling and clearance.

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Appendix 3A: The Role of Elasticities in Determining the Impacts of a

Rule

EPA is often faced with deciding on a regulatory policy in the absence of good information about the

likely effects of the policy on consumers and producers. In particular, data on the own-price elasticity of

supply and demand often are uncertain. This appendix provides background information on the likely

effects of own-price elasticity of demand and supply on the outcomes of EPA’s regulatory efforts. The

bulk of the discussion focuses on the case of perfect competition, not because the majority of markets

EPA is likely to affect will exhibit competitive behavior, but simply because the theory is clearly defined

in this case. However, this appendix also examines the likely impacts of relaxing the assumption of

perfect competition. It focuses on two general classes of regulatory options: regulations that alter the

market outcome by imposing additional costs upon producers, and regulations that alter the market by

providing information to consumers.

3A.1 Elasticities of Supply and Demand

The market equilibrium for a commodity (e.g., purchasing renovation, remodeling or painting (RRP)

work that uses lead-safe work practices) is determined by the intersection of the aggregate demand and

supply curves. The aggregate demand curve depicts consumer behavior and is based on consumer income

and preferences. Likewise, the aggregate supply curve describes the behavior of producers in the market,

and is dependent upon the costs of production. At market equilibrium, the price is referred to as market

clearing. In other words, at this price, the quantity demanded by consumers and supplied by producers

are equal and neither the consumer nor producer has any incentive to move away from this steady state as

long as current demand and supply conditions prevail.

However, when demand and supply conditions do change, for example when new information causes

consumers to adjust their preferences and thus shift the demand curve, or changes in input prices affect

costs of production and shift the supply curve, the market gravitates to a new equilibrium. This new

equilibrium is represented by a new combination of market clearing price and quantity. The magnitude of

the change in price and quantity is dependent not only upon the extent of the shift in the demand or supply

curve, but also on the own-price elasticity of demand and supply for the commodity.

The own-price elasticity of demand is defined as the ratio of the percent change in quantity demanded to

the percent change in price, and is reflected in the slope of the demand curve, similarly for the own-price

elasticity of supply. By determining the level of change in price and quantity, the elasticities of the two

curves also determine the distribution of the burden or benefit between the consumer and producer

resulting from a change in equilibrium conditions. Analyzing changes in consumer and producer

surpluses provides a means for quantifying such distributional changes.

Figure 3A-1 below provides a hypothetical example of how the effects of regulation may impact

consumer and producer surpluses. In the baseline, the supply curve is represented by S1, and producers

supply Q1 at a price P1. On all the inframarginal units supplied, producers receive a price above the cost

of production. The difference between the price and the cost of production represents the producer

surplus resulting from supplying Q1 at price P1 (triangle P1CD). Similarly, in the baseline consumers

demand quantity Q1 at price P1. For all the inframarginal units demanded, consumers would be willing to

pay more than that price and thus receive a surplus. The difference between what consumers are willing

to pay as measured by the height of the demand curve, and what they have to pay is the consumer surplus

(triangle ACP1).

So what are the effects of regulation? In Figure 3A-1, the upward shift in the supply curve to S2 (say

from a rise in production costs due to the implementation of the RRP rule which requires use of the more

costly lead-safe work practices) results in a new equilibrium at the point B, with a new market price of P2

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and quantity of Q2. Note that producer surplus decreases from P1CD to EBP2 and the consumer surplus

also decreases from ACP1 to ABP2. Thus, in the arbitrary case drawn in Figure 3A-1, the social costs of

the regulation are born by both consumers and producers of the pollution-generating good. This result

turns out to be a function of the way the supply and demand curves have been drawn, and the distribution

of costs between consumers and producers depends on the slope (elasticity) of the demand and supply

curves.

Figure 3A-1: Effect on consumer and producer surplus due

to a supply curve shift

A

B

C

D

E

Q2 Q1

P1

P2

S2

S1

D

In general, for a given production cost increase, the more elastic the demand curve, the greater the

inability on the part of the producers to pass the additional costs of production on to the consumers. As

shown in Figure 3A-2 (a) and 3A-2 (b) below, the differing slopes of the demand curve lead to

differential impacts on the consumer and producer surplus. In Figure 3A-2 (a) demand for the good is

relatively price elastic, while in Figure 3A-2 (b) the good has a relatively inelastic demand. Notice that

when demand is less elastic, the price increase resulting from a shift in supply is greater and consumers

bear a greater share of the loss in consumer surplus. On the other hand, with a more elastic demand, the

overall price increase is smaller and the share of total costs born by producers is larger.

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Figure 3A-2(a): Effect of a

change in input prices when

demand is elastic

Figure 3A-2(b): Effect of a

change in input prices when

demand is inelastic

S2

S1

D

Q2 Q1

P1

P2

Q2 Q1

P1

P2

D

S1

S2

The elasticity of demand is determined in general by the existence of suitable substitutes for a

commodity. If several commodities exist in the market that are considered to be close substitutes for each

other, then a consumer is likely to have a great deal of choice available to him while making his

consumption decision. This being the case, if the price of the commodity that he is presently consuming

happens to rise, he is easily able to reduce his current consumption level of that commodity and switch

over to consuming more of one of the substitutes. This flexibility limits the ability of the producer to pass

on the burden of the cost increase on to the consumer. Thus, the availability of close substitutes in the

market explains why the demand curve for a commodity will be relatively elastic, and why the rise in

price will be relatively small. On the other hand, if substitutes are lacking for a commodity that

experiences a price increase (and it is not a luxury good), then the consumer has little choice but to carry

on consuming similar quantities of the same product. Thus, in this situation he will have to shoulder a

larger share of the increased costs by paying a much higher price, and this rigidity in his consumption

behavior explains the inelastic nature of the demand curve for that commodity.

Recognizing that most markets are not perfectly competitive, product differentiation allows firms to

charge prices higher than marginal costs and charge different prices for similar goods. The degree to

which producers can pass on the cost of production depends heavily on the degree to which they can

convince consumers that their product is different from other products. In its limit this argument is just a

restatement of the fact that markets with lower elasticities of demand will experience higher price

increases. If “market demand” is defined to be the demand for a single brand of good, then the number of

substitutes for the good affects its demand elasticity and thus affects the degree to which the producer can

pass on cost increases. If the firm can convince consumers that the product is distinct then it in essence

lowers the elasticity of demand for its product.

The own price elasticity of supply, on the other hand, is dependent on the degree of specialization of

inputs. If the inputs are highly specialized or firms are locked into long-term contracts then firms in this

industry can be left with substantial sunk investments creating high transition costs which are reflected in

an inelastic supply curve. However, if supply is highly elastic then firms can easily switch production to

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other uses and minimize the effect of the demand shock. In essence the elasticity of supply measures the

amount of resources lost or tied up indefinitely when consumption patterns change suddenly.

The EPA seeks to reduce hazards from lead-based paint by two separate pathways of regulatory impact.

First, it hopes to reduce exposure to lead-based paint by regulating the “method of production” of RRP

work in opt-out housing by establishing standards for such activities and through requiring certifications

and/or training. This is likely to result in an increase in the “costs of production” of RRP work thereby

affecting the supply curve for such activities. Second, the rule will provide information to consumers. In

this case EPA is likely to alter the market outcomes by changing the demand for products (lead-safe and

non lead-safe work practices). To the extent that the demand and supply of RRP work will be affected by

the rule, one must consider the price elasticities involved to determine the distributive impact of the rule

on consumers and producers.

An important factor on which the price elasticity will depend is the number of substitutes that exist for the

RRP service that is sought in the market. As previously explained, the greater the number of available

substitutes, the more elastic the demand and lesser the burden of a production cost increase likely to fall

on the consumer. Under this rule three classes of substitutes may be said to exist for RRP services. These

are (1) professionals using lead-safe work practices, (2) professionals using non lead-safe work practices,

and (3) the do-it-yourself jobs. Thus, a certain amount of flexibility is available to the consumer when it

comes to hiring RRP services.

Currently a sizeable number of RRP firms may not necessarily be following lead-safe work practices

thereby limiting the size of the class of firms that do so. However, with the implementation of the rule, a

much larger number of firms are expected to adhere to these practices in the future, thus enlarging the size

of this class. In addition, this increase in the number of professionals using lead-safe work practices will

also have a geographical impact. Presently, the limited number of professionals who use lead-safe work

practices are concentrated in a select number of locations where state and local regulations have fostered

their development. As a result, in many parts of the country the choice of hiring “lead-safe” professionals

currently does not exist. But this situation will change as a larger number of firms switch to lead-safe

work practices once the rule come into effect.

However, if the increase in production costs from the rule is extremely high such a large transition of

firms from using lead-unsafe to lead-safe work practices may not occur. This is because the cheaper

option of using non-certified (non lead-safe work practice using) RRP workers or doing the work yourself

will limit the ability of the certified (lead-safe work practice using) professional to charge the consumer

for all or a large portion of this significant cost increase. In this situation a large number of lead-unsafe

firms may remain in existence. Thus, one may assume that as long as an appreciable difference exists

between “costs of production” of lead-safe and non lead-safe work practices, firms of both types will

continue to exist. The continued existence of firms using non lead-safe practices also depends on the

extent and effectiveness of enforcement activities. The greater the cost differential between lead-safe and

non lead-safe practices, the greater the need for enforcement activities.

In addition to the number of substitutes, the closeness of substitutes in their ability to replace one another

needs to be judged. The important question is whether RRP work done by uncertified professionals and

the do-it-yourself efforts are substantially less safe than the services of certified professionals. To the

extent an appreciable difference exists between the quality of service (in terms of preventing or reducing

lead-based paint hazards) provided by the two groups, they will not be perceived as close substitutes for

each other and their demand curves will not be as elastic as they would have been if they were considered

close substitutes. In such a situation, consumers feel that a sufficiently differentiated product is being

offered by the two groups, and thus their choice is limited.

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This judgment on the degree of closeness of substitutes will to some extent depend upon the importance

that lead safety holds with the property owner compared to other priorities. To the extent that the priority

assigned to lead exposure is relatively small, the uncertified professionals and do-it-yourself jobs will

tend to be seen as closer substitutes for certified professionals, than if lead-based paint hazards are

perceived as a larger threat by the property owner. Thus, the elasticity of demand will also vary according

to owner priorities, and in this regard, the informational aspect of the rule may in fact assist in raising

more awareness, resulting in lead safety being assigned a higher priority.

Of a related nature, the firm certification aspect of the rule is likely to increase consumer ability to

differentiate between the services being offered by the three classes of substitutes. The certification

process will create a distinct divide which will permit the property owner to get a better appreciation of

the varied benefits to be gained from the alternatives at hand. This is likely to reduce to some extent the

perceived closeness of the substitutes and thereby make the demand more inelastic for each class of RRP

service.

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Chapter 3 3-24

3A.2 How Price Elasticity of Demand Affects the RRP Rule

As discussed above, EPA foresees two separate pathways by which the rule will take effect; increasing

costs of production leading to a shift in supply and provision of information to consumers leading to a

shift in demand. The way these two effects will play out and the role that price elasticities will play in the

adjustment of prices and quantities under the two scenarios is discussed below.

3A.2.1 Effect of Rule on the Cost of Production (Supply Shift)

EPA seeks to reduce exposure to lead-based paint hazards by the introduction of lead-safe work practices

during RRP work. These practices involve the use of increased precautions in situations where lead-based

paint hazards may potentially be created during RRP work, and as a result costs of RRP work are likely to

increase above current levels. Since producers seek to maximize profits and in the baseline will produce

goods using the lowest-cost combination of inputs, a rule requiring producers to change their input mix

will necessarily increase the cost of production. Thus, one impact of the rule will be to increase the

production costs, leading the supply curve to shift upward and to the left.

Figures 3A-2(a) and 3A-2(b) demonstrate the distributional affects of such a hypothetical shift in supply

in markets with different elasticities of demand. The price increase is much higher (P1 to P2) and the

decrease in quantity demanded is much lower (Q1 to Q2) with a given shift in supply when demand is

less elastic (as shown in Figure 3A-2(b)) as compared to the elastic demand scenario in Figure 3A-2(a).

Thus, the consumers bear a higher share of the total social cost from the regulation (represented by the

relatively larger decrease in the consumer surplus compared to that in the producer surplus). On the other

hand, Figure 3A-2(a) shows that the higher the elasticity of demand, the lower the overall price increase,

the larger the reduction in quantity demanded, and thus the larger the share of total costs to be born by

producers (represented similarly by the larger decrease in producer surplus as compared to the consumer

surplus).

3A.2.2 Effect of Rule on the Provision of Information to Consumers (Demand Shift)

The alternative regulatory approach is to provide information to consumers in the hopes that they will

make more environmentally friendly consumption choices. In this case EPA alters the market outcomes

by changing the demand for products. Figures 3A-3(a) and 3A-3(b) depict such a hypothetical example.

In these cases the commodity in question (non lead-safe work practices) has negative environmental

effects (byproducts). By educating consumers about these byproducts and alternative products that have

lower levels of adverse effects (lead-safe work practices), EPA can change consumer preferences and

shift demand for the “bad product” inward and to the left. This lower demand curve would more

accurately reflect the true “social” marginal benefits of consuming the product.

What are the likely distributional and efficiency effects of this type of regulatory policy? Figures 3A-3(a)

and 3A-3(b) reveal that under both scenarios (for an elastic and inelastic supply curve), the downward

shift in the demand curve will lead to a decrease in price and quantity demanded of the commodity.

However, in the case of an elastic supply curve when the transition costs associated with switching to the

production of other products is relatively low, the decrease in price of the commodity is smaller and the

decrease in quantity demanded larger, as compared to the changes in the case of an inelastic supply curve

involving high transition costs. Restated in terms of changes in producer and consumer surpluses, the

producer surplus is reduced under each scenario, but the elastic supply curve causes a relatively smaller

burden to fall on the producer than the inelastic supply curve. Similarly, the consumer receives a

reduction in social benefit under each scenario; however, the magnitude of this reduction is larger under

the inelastic supply curve case.

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Chapter 3 3-25

Figure 3A-3(a): Effects of a

regulation-induced change in

demand when supply is elastic

Figure 3A-3(b): Effects of a

regulation-induced change in

demand when supply is inelastic

D1

D2

S

Q2 Q1

P1

P2

Q2 Q1

P1

P2

D2

D1

S

3A.2.3 Application to Renovation

In the rule, EPA is both affecting production and providing information. The likely effects of the

regulation on prices and welfare are difficult to discuss without more accurate information on the supply

and demand elasticities. However, some general observations are warranted.

The welfare effects of the regulation will likely be driven by the supply side rather than the demand side.

This is because the elasticity of supply for RRP services is likely to be relatively higher than the elasticity

of demand. Supply elasticities are expected to be relatively high because there are relatively few barriers

to entering or leaving this industry. Little capital equipment or specialized labor skills are needed for

RRP work, and what is needed is easily transferred from non-compliant renovation to “lead-safe”

projects. On the demand side, there are two primary categories of RRP events – those of a maintenance

character and those of an improvement character. Maintenance activities usually cannot be postponed

and thus are not particularly sensitive to price. Improvement projects, however, can more easily be

postponed and thus tend to be more price elastic. Complicating matters, however, are the existence of

different categories of purchasers. Some place a high premium on quality and timeliness, while others

actively seek low prices. Appendix 3B discusses some of the empirical evidence on elasticities of

demand and supply.

However, the analysis does not suggest that the education factor is unimportant. If the regulation is not

accompanied by education efforts and enforcement, then EPA could unintentionally drive up demand for

non-compliant renovation projects creating additional welfare losses. These losses are the result of the

fact that if consumers were aware of the lead paint issues their true marginal valuation for the noncompliant projects is lower than the price of these projects. Thus, if enforcement is not perfect, education

is essential. EPA can compensate for the fact that it is raising the costs of lead-free renovation on the

supply side by educating consumers on the environmental effects of non-compliant renovations thereby

making these cheaper, non-compliant projects less attractive.

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Chapter 3 3-26

Appendix 3B: Elasticities of Demand and Supply for Housing /

Renovation Services

As described in Chapter 3 and Appendix 3A, the impact of increases in the cost of RRP services on

demand for RRP will depend on both the size of the cost increase and the elasticity of demand for these

services. Likewise, the impact on the supply of RRP services will depend on both the size of the cost

increase and the elasticity of supply for these services. These impacts are expressed in terms of changes

in price and in the quantity of services purchased. Chapter 4 estimates the cost increases due to the

requirements of the various regulatory options, based on the increased labor and materials costs of

complying with the containment and clean-up requirements, as well as the training and certification costs

imposed by the requirements. This appendix reviews the existing literature on residential demand

elasticities.

Unfortunately, RRP has received relatively little attention by housing economists. While there are many

studies that estimate elasticities for new construction, these studies have only limited applicability to

renovation and remodeling. The income elasticity of demand for housing is generally estimated to be

somewhat inelastic (in the 1.0 to 0.8 range). This is consistent with housing being a necessity –

expenditures on housing do not increase as rapidly as income (Green and Malpezzi 2003). Demand for

housing is also considered to be somewhat price inelastic, with generally accepted values either in the

range of -0.5 to -1.0 or -0.75 to -1.2 (Mayo 1981, Malpezzi and Maclennan 2001, Ellwood and Polinski

1979). One study is available that estimated a renovation demand elasticity (Gyourko and Saiz 2003).

This study found renovation demand to be very inelastic, with an elasticity estimated to be –0.28.

On the other hand, housing supply appears to be very elastic – consistent with the highly competitive

nature of the residential construction market and the large number of small contractors. Because it is very

easy to enter (and to leave) the construction business, supply is very responsive to changes in prices,

especially in the long run.2 Based on the literature surveyed, estimates of housing supply elasticities tend

to range from 1.0 to 4.0, but a couple of studies found elasticities as high as 13 or higher (DiPasquale and

Wheaton 1994, Topel and Rosen 1988, Blackley 1999, Malpezzi and Maclennan 2001). No elasticity

numbers specific to the supply of renovation services could be found.

Several characteristics of RRP tend to make its demand more price elastic than the demand for housing in

general. For example:

 The existence of close substitutes to compliant RRP. These substitutes include:

 Do-It-Yourself RRP –owners of buildings may be tempted to do their own RRP work

without proper training and certification.

 Firms that do not complying with the regulations. These regulations may be difficult to

enforce against contractors, particularly the large number of small contractors who may

be hard to identify and monitor.

 Reductions in the scope of the projects, or postponement of the projects, to compensate

for the price increase. Purchasers can reduce other RRP-related costs by substituting

lower-priced fixtures/finishes and/or less extensive remodeling.

 Many RRP projects are discretionary. The price elasticity of discretionary projects is likely to be

higher than replacement projects (e.g. new roof). For discretionary RRP projects, it is relatively

easy for the purchaser to reduce the scale/scope of the project, postpone the project, or never do

it.

2 Note – stock adjustment models give lower elasticities than flow models. Malpezzi and Maclennan (2001).

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Chapter 3 3-27

Offsetting these characteristics that foster higher elasticities of demand, are ones that foster lower

elasticities. The major one is that the product purchased cannot be separated from the firm providing the

product, which is true of all services. In addition to the various RRP events analyzed in the subsequent

chapters, RRP firms themselves are relatively differentiated. Some firms specialize in high-end,

complicated projects (e.g. elaborate new kitchens) while other firms specialize in performing small

routine tasks (repainting apartments at tenant turn-over). Some firms only work in historic or Victorian

homes, while others will work on any type of home. Some firms do only one type of project (e.g.

replacing siding) while other firms will do any and all types of RRP work. This differentiation results in

lower demand elasticities, because producers may not be considered particularly close substitutes.

 To the extent that lead-safe work can be distinguished from non-lead-safe work, a higher price

can be charged for it.

 Many contractors already employ lead-safe practices (or at least control the dispersion of dust and

clean well before leaving). The regulations will serve to reduce this differentiation.

Second, the nature of RRP projects may also reduce price competition. For relatively small jobs, property

owners frequently will not get multiple bids – the assumed cost of the job does not warrant the effort. In

this case, the compliance cost can be passed on without fear of losing the work. In the case of large jobs,

where owners will get bids, compliance costs will make up a relatively small proportion of the total cost

and, again, passing on the costs may be easy.

Characteristics of the purchaser of the RRP services may also affect their demand price elasticity. Highincome purchasers are likely to be less price sensitive than low-income purchasers. In addition, owners of

rental properties may be more price sensitive than owner occupants because they have different objective

functions. Owner-occupants operate so as to maximize their utility (their enjoyment of the house) and

asset growth is likely to enter their decision as a secondary factor. Owners of rental housing, on the other

hand, are assumed to be maximizing their profits. It is reasonable to expect that the optimal level of

capital of an absentee landlord’s rental building is lower than that of an owner-occupier’s house, since the

landlord’s marginal rent revenue from renovations is likely to be less than the homeowner’s marginal

utility.

Because of the lack of detailed price elasticity estimates for RRP, the analysis in Chapters 4, 5 and 6 does

not incorporate any reduction in professional RRP activities in response to the cost increases resulting

from the regulation.

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Chapter 3 3-28

References

Centers for Disease Control. 1997. “Children with Elevated Blood Lead Levels Attributed to Home

Renovation and Remodeling Activities -- New York, 1993-1994.” Morbidity and Mortality

Weekly Reports. 45(51&52);1120-3. Available at:

http://www.cdc.gov/mmwr/preview/mmwrhtml/00045033 htm.

Centers for Disease Control. 2002. Managing Elevated Blood Lead Levels Among Young Children

(March).

Centers for Disease Control. 2004. Preventing Lead Exposure in Young Children: A Housing Based

Approach to Primary Prevention of Lead Poisoning: Recommendations from the Advisory

Committee on Childhood Lead Poisoning Prevention (October).

Centers for Disease Control. 2005. “Blood Lead Levels --- United States, 1999—2002.” Morbidity and

Mortality Weekly Reports. 54(20);513-516. Available at:

http://www.cdc.gov/mmwr/preview/mmwrhtml/mm5420a5.htm#tab1.

National Association of the Remodeling Industry (NARI). Undated. Interview Remodeler. Available at:

http://www.nari.org/homeowners/interview/

Residential Lead-Based Paint Hazard Reduction Act of 1992, Pub. L. no. 102-550. 106 Stat. 3672

(1992).

U.S. Department of Housing and Urban Development (HUD). 1990. Comprehensive and Workable Plan

for the Abatement of Lead-Based Paint in Privately Owned Housing: Report to Congress.

Washington, DC, February.

U.S. Department of Housing and Urban Development (HUD). 1995. Guidelines for the Evaluation and

Control of Lead-Based Paint Hazards in Housing (June).

U.S. Department of Housing and Urban Development (HUD). Data as of August, 2000. National Survey

of Lead and Allergens in Housing. Office of Healthy Homes and Lead Hazard Control,

Washington, DC.

U.S. Department of Housing and Urban Development (HUD). 2004b. Requirements for Notification,

Evaluation, and Reduction of Lead-based Paint Hazards in Housing Receiving Federal Assistance

and Federally Owned Residential Property Being Sold (Lead Safe Housing Rule); Final Rule,

Conforming Amendments and Corrections. Federal Register (69 FR 34262, June 21, 2004).

U.S Department of Housing and Urban Development (HUD) and U.S. EPA. 1996. Lead; Requirements

for Disclosure of Known Lead-Based Paint and/or Lead-Based Paint Hazards in Housing; Final

Rule. Federal Register (61 FR 9064, March 6, 1996)

U.S. Department of Labor, Occupational Safety and Health Administration (OSHA). 1993. Lead

Exposure in Construction; Interim Final Rule. Federal Register (58 FR 26590, May 4, 1993).

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Chapter 3 3-29

U.S. Environmental Protection Agency (EPA). 1984. EPA Policy for the Administration of

Environmental Programs on Indian Reservations (November 8).

U.S. Environmental Protection Agency (EPA). 1995. Lead Hazard Information Pamphlet; Notice of

Availability. Federal Register (60 FR 39167, August 1, 1995).

U.S. Environmental Protection Agency (EPA). 1996. Lead; Requirements for Lead-Based Paint

Activities in Target Housing and Child-Occupied Facilities: Final Rule. Federal Register (61 FR

5778, August 29, 1996).

U.S. Environmental Protection Agency (EPA). 1997. Lead Exposure Associated with Renovation and

Remodeling Activities: Environmental Field Sampling Study (EFSS). EPA 747-R-96-007, May

1997. http://www.epa.gov/lead/pubs/r96-007.pdf

U.S. Environmental Protection Agency (EPA). 1998. Lead; Requirements for Hazard Education Before

Renovation of Target Housing; Final Rule. Federal Register (63 FR 29908, June 1, 1998).

U.S. Environmental Protection Agency (EPA). 1999. Lead; Fees for accreditation of Training Programs

and Certification of Lead-based Paint Activities Contractors; Final Rule. Federal Register (64 FR

31092, June 9, 1999).

U.S. Environmental Protection Agency (EPA). 2001b. Lead; Identification of Dangerous Levels of

Lead; Final Rule. Federal Register (66 FR 1206, January 5, 2001)

U.S. Environmental Protection Agency (EPA). 2003a. Lead Safety for Remodeling, Repair, And

Painting. Joint EPA/HUD Renovation Training Curriculum (EPA 747-B-03-001/2, July 2003).

U.S. Environmental Protection Agency (EPA). 2003b. Protect Your Family From Lead in Your Home.

U.S. Environmental Protection Agency, U.S. Consumer Product Safety Commission, and U.S.

Department of Housing and Urban Development, (EPA 747-K-99-001, June 2003).

U.S. Environmental Protection Agency (EPA). 2004a. Lead; Notification Requirements for Lead-Based

Paint Abatement Activities and Training; Final Rule. Federal Register (69 FR 18489, April 8,

2004)

U.S. Environmental Protection Agency (EPA). 2004b. Targeted Grants to Reduce Childhood Lead

Poisoning; Notice of Funds Availability. Federal Register (69 FR 69913, December 1, 2004).

U.S. Environmental Protection Agency (EPA). 2005c. Air Quality Criteria for Lead (First

External Review Draft). EPA/600/R-05/144aA-bA. December.

http://cfpub2.epa.gov/ncea/cfm/recordisplay.cfm?deid=141779

U.S. Environmental Protection Agency (EPA). 2007. Characterization of Dust Lead Levels After

Renovation, Repair, And Painting Activities. November 13, 2007.

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U.S. Environmental Protection Agency (EPA). 2008. Renovate Right: Important Lead Hazard

Information for Families, Child Care Providers and Schools (EPA 740-F-08-002, March 2008).

U.S. Environmental Protection Agency (EPA). 2009. Lead; Fees for Accreditation of Training Programs

and Certification of Lead-based Paint Activities and Renovation Contractors. 74 FR 11863,

March 20, 2009.

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Chapter 4 4-1

4. Costs of the Lead, Renovation, Repair, and Painting Rule

Revisions

The proposed LRRP Clearance Rule includes the following changes to the LRRP program: (1) a

requirement to perform dust wipe testing for a subset of renovation activities, and (2) a requirement to

perform dust wipe testing and achieve clearance for a second subset of renovation activities where the

quantity and characteristics of the dust make it hard to clean up. In particular, the proposed LRRP

Clearance Rule would require dust wipe testing on uncarpeted floors and on window sills and troughs

after the following types of renovations that disturb lead-based paint: use of a heat gun at temperatures

below 1100 degrees Fahrenheit1; removal or replacement of window or door frames; scraping 60 ft2or

more of painted surfaces; or removing more than 40 ft2of trim, molding, cabinets, or other fixtures.

Renovations using machines that remove lead-based paint through high speed operation (such as power

sanders or abrasive blasting), or involving demolition or removal of plaster walls with lead-based paint

through destructive means will require firms to demonstrate – through dust wipe testing – that they have

met clearance standards before the renovation will be considered complete.

The costs of the proposed LRRP Clearance Rule were estimated under a baseline scenario where the optout provision of the 2008 LRRP rule has been eliminated, as was proposed in October 2009 (74 FR

55506). This choice for the baseline scenario has the advantage that the cost impacts estimated in the

Economic Analysis of the proposed Opt-Out Rule (EPA 2009) and those estimated in this analysis can be

added together to estimate the combined impact of both rules.2Since the proposed LRRP Clearance Rule

was developed before the LRRP Opt-Out Rule was finalized, the costs of the proposed LRRP Clearance

Rule are also estimated for the alternative baseline scenario where the opt-out provision has not been

eliminated (see section 4.7).

The costs associated with the revisions to the §402(c) Lead, Renovation, Repair, and Painting (LRRP)

Rule are divided into three categories for the purposes of this analysis: (1) dust wipe testing costs, (2)

clearance costs, and (3) training costs. The general approach of the analysis is to first estimate the

number of affected activities or entities and then estimate the incremental regulatory cost per-activity or

entity affected. Next, the incremental costs and the number of affected activities and entities are

combined to estimate the total costs. The analysis estimates the total costs associated with the first and

second years of regulation and then extrapolates to the costs of the regulation over a fifty year period—

estimated with three and seven percent discount rates. See Figure 4-1 for an illustration of the general

approach used to estimate the costs of the proposed LRRP Clearance Rule.

The cost analysis uses the results of four different surveys of fewer than 10 firms each to estimate the

annual frequencies for the different types of events covered by the proposed rule. The small sample sizes

in the surveys (relative to the number of firms in the industry) may affect both the accuracy and precision

of the estimates of the number of events requiring dust wiping or clearance, and thus the estimated cost of

the proposed rule.

1 Under the 2008 LRRP rule at 40 CFR 745.85(a)(3)(iii), operating a heat gun on lead-based paint is permitted only at

temperatures below 1100 degrees Fahrenheit.

2 Note that the two analyses differ in the current dollars that are used. In addition, both analyses use 50-year time horizons, but

the Opt-Out analysis time period starts in 2010 and this rule’s time period starts in 2011 – in a combined analysis they would

have the same time horizon.

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Chapter 4 4-2

Figure 4-1: General Approach to Cost Analysis

The chapter is organized as follows: Section 4.1 defines the regulatory options considered in this analysis;

Section 4.2 presents estimates of the number of regulated renovation, repair, and painting events where

dust wipe testing or clearance will be required under the various regulatory scenarios; Section 4.3 presents

the estimated costs of performing dust wipe testing and clearance, including the associated paperwork and

recordkeeping costs; Section 4.4 presents the estimated number of Sampling Technicians seeking training

and certification; Section 4.5 presents the costs of training Sampling Technicians; Section 4.6 presents the

total costs of the proposed regulatory options. Section 4.7 presents the total costs of the proposed rule

with an alternative baseline that excludes Opt-Out housing and also presents the costs of the rule under

additional alternative options.

4.1 Definitions of Options

This economic analysis considers various regulatory options. The three primary options considered in

this analysis only differ in the size thresholds that trigger the rule’s requirements when performing certain

renovation activities. The three threshold options considered in this analysis are:

1. Low Threshold Option

 All event types requiring dust wipe testing where the amount of lead-based paint

disturbed is larger than 6 square feet.

 Clearance is required for:

- high-speed machine removal of paint larger than 6 square feet, and

- plaster removal using destructive means, larger than 6 square feet.

2. Proposed Threshold Option

 Dust wipe testing is required for:

- cabinet and trim events larger than 40 square feet,

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Chapter 4 4-3

- scraping of paint larger than 60 square feet,

- heat gun removal of more than 6 square feet

- Window frame or door frame removal events

 Clearance is required for:

- high-speed machine removal of paint larger than 6 square feet, and

- plaster removal using destructive means, larger than 6 square feet.

3. High Threshold Option

 Dust wipe testing is required for:

- cabinet and trim events larger than 80 square feet,

- scraping or heat gun removal of paint larger than 120 square feet, and

- window frame or door frame removal events.

 Clearance is required for:

- high-speed machine removal of paint larger than 60 square feet, and

- plaster removal using destructive means, larger than 60 square feet.

Section 4.7 considers three alternative options in addition to the three primary options: (1) an option

where third party dust wipe testing (including dust-wipe testing for clearance) is required; (2) an option

that requires dust wipe testing for all of the renovation events covered by the proposed rule but does not

require clearance for any of them; and (3) an option where clearance is required for all renovation events

covered by the proposed rule.

All the primary and alternative options are analyzed under the baseline scenario where the opt-out

provision of the 2008 LRRP rule has been eliminated as proposed. Since the proposed LRRP Clearance

Rule was developed before the LRRP Opt-Out Rule was finalized, section 4.7 also presents the estimated

costs for the proposed LRRP Clearance Rule under an alternative baseline using the regulated universe

under the 2008 LLRP Rule (which excludes opt-out eligible housing from the universe). Table 4-1

summarizes the options presented in the economic analysis.

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Chapter 4 4-4

Table 4-1: Options Included in Economic Analysis

Option Size Threshold Dust Wipe Testing and

Clearance

Third Party

Requirement Baseline

Low Threshold

Option

Size thresholds are

lower or equal to

proposed rule

No 2008 +

Opt Out

Proposed

Threshold

Option

Size thresholds are

as proposed No 2008 +

Opt Out

High Threshold

Option

Size thresholds are

higher or equal to

proposed rule

Dust wipe testing is required for:

1. cabinet and trim events

2. scraping of paint

3. heat gun removal of paint

4. Window frame or door frame

removal events

Clearance is required for:

1. high-speed machine removal of

paint

2. plaster removal using destructive

means

No 2008 +

Opt Out

Third Party

Option Same as Proposed

Dust wipe testing and clearance are

required in the same instances as

proposed

Yes 2008 +

Opt Out

Dust Wipe

Testing Only

Option

Same as Proposed

Dust wipe testing is required in

instances where dust wipe testing

or clearance are required under the

proposed option

No 2008 +

Opt Out

Clearance Only

Option Same as Proposed

Clearance is required in instances

where dust wipe testing or

clearance are required under the

proposed option

No 2008 +

Opt Out

Proposed

Option with

Alternative

Baseline

Same as Proposed Same as Proposed No 2008

4.2 Number of Events with Dust Wipe Testing or Clearance Requirements

Two requirements of the clearance rule that will have cost implications are: (1) a requirement for dust

wipe testing for a subset of renovation activities, and (2) a requirement for dust wipe testing and clearance

for a second subset of renovation activities where the quantity and characteristics of the dust make it hard

to clean up. In order to estimate the full extent of these costs, it is necessary to determine the total

number of renovation events that will be affected by either of these additional requirements. This section

identifies the event types where either dust wipe testing or clearance will be required, describes the

methodology for estimating the frequencies of these events, and then presents the resulting estimates.

The events with additional requirements under the clearance rule are only a subset of the types of RRP

events identified in EPA’s analysis of the 2008 LRRP rule (EPA 2008). This analysis relies both on

secondary sources and primary data collected from fewer than 10 firms to estimate the frequencies of

these dust wipe testing and clearance events. Table 4-2 and Table 4-3 describe the events requiring dust

wipe testing or clearance in the context of the 2008 event definitions and discuss the methodology used

for estimating event frequencies.

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Chapter 4 4-5

Table 4-2: Proposed Dust Wipe Testing Renovation Events

Clearance Rule Events

Events Within Category

from EPA 2008 (and

building types events

occur in) Event Frequency Estimation Method

Interior Painting with Heat

Gun

Interior Painting with

Scraping

Interior Painting (TH & PCCOF

The results from a survey of <10 painting firms are used to estimate

the frequency with which paint removal practices are used and the

distribution of job sizes.

Bathroom Cabinet Replacement

(TH)

Kitchen Cabinet Replacement

(TH)

1997 AHS data and HUD’s 2001 NSLAH data are used to estimate the

frequency of cabinet replacement. 58% of Kitchen renovations involve

cabinet replacement (AHS 1997). Based on the number and size of

cabinets according to HUD (2001), 100% of kitchen cabinet jobs are >

6 sq. ft., 89.5% > 40 sq. ft., and 62% > 80 sq. ft., and 42% of

Bathroom renovations involve cabinet replacements, with an assumed

100% of these cabinet jobs greater than 6 sq. ft. and less than 40 sq. ft. Removal of Trim, Molding,

Cabinets, or Fixtures

Trim/Molding replacement

during: Bathroom, Kitchen,

Wall-Disturbing, Addition, or

Interior Painting Event

(TH & PCCOF)

Based on survey of 6 carpentry firms and 3 general contractors about

what type of jobs they are performing when they replace trim or

molding (e.g., kitchen remodeling) and how frequently they do this

during these job types.

Removal or Replacement of

Windows or Door Frames

Window/Door Event (TH &

PCCOF)

Based on survey of 6 carpentry firms and 3 general contractors about

how often doors and windows are replaced without replacing the

frames.

EPA 2008 = Economic Analysis for the TSCA Lead Renovation, Repair, and Painting Program Final Rule for Target Housing and

Child-Occupied Facilities, March 2008.

TH = Target housing

PCCOF = Public or Commercial Building COF

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Table 4-3: Proposed Clearance Renovation Events

Clearance Rule Events

Events Within Category

from EPA 2008 (and

building types events occur

in) Event Frequency Estimation Method

Bathroom (TH)

Kitchen (TH)

Wall-Disturbing (TH & Pub/Com

COF)

Plaster – Demolish, or

Remove through

Destructive Means (e.g.,

sledgehammer, etc.)

Addition (TH)

1997 AHS data is used to estimate the frequency of

repairing/replacing/removing plaster walls. The percentage of plaster

wall repair/replacement/removal jobs, by size, that involve demolishing

them with destructive means is estimated from a survey of 9 carpentry

and general contractor firms.

Interior Painting with HighSpeed Machine Paint

Removal

Interior Painting (TH & Pub/Com)

The results from a survey of <10 painting firms are used to estimate the

frequency with which paint removal practices are used and the

distribution of job sizes

EPA 2008 = Economic Analysis for the TSCA Lead Renovation, Repair, and Painting Program Final Rule for Target Housing and ChildOccupied Facilities, March 2008.

TH = Target housing

PCCOF = Public or Commercial Building COF

4.2.1 Event Frequencies Based on Primary Data Collections From Fewer Than Ten

Firms

This section includes the descriptions of the four questionnaires used to collect primary data from fewer

than 10 firms. Following the survey descriptions, the survey results are presented along with the resulting

estimated dust wipe testing and clearance event frequencies.

The four primary data collections include: (1) one questionnaire for nine painting contractors that is used

to determine the frequency of interior painting jobs of various sizes that use certain paint removal

techniques, (2) one questionnaire for six carpentry firms for determining: (a) the frequency of trim and

molding removal, and (b) the frequency of window and door frame replacement, (3) one questionnaire for

three general contractors that includes all the questions asked to carpenters in addition to questions that

are used to estimate the frequency of destructive removal of plaster walls, and (4) one questionnaire for

six general contractors used to estimate the frequency of destructive removal of plaster walls.

4.2.1.1 Contractor Firms Sample Universe

A geographically diverse sample of nine firms for each questionnaire was developed. First, nine states

were randomly selected while limiting the sample to no more than one state per EPA region. Once the

nine states were selected, lists of painting firms (for the paint removal survey), carpentry firms (for the

carpenter survey), and general contractor firms (for the third and fourth survey) were obtained through

Salesgenie.com, an online directory of businesses searchable by state and SIC code. The simple averages

of the responses for each questionnaire were calculated in order to estimate the necessary parameters. For

the interior painting questionnaire, which was administered to firms in SIC code 172101 (Painters), the

following states were selected: Louisiana, West Virginia, Alabama, Maine, Idaho, Hawaii, Kansas, Utah,

and Indiana. For the plaster questionnaire, which was administered to firms with SIC codes 152103,

152105, 152115, and 152139 (General Contractors, Home Improvements, Handyman Services, and

Remodeling & Repairing Building Contractors), the following states were selected: Texas, Iowa,

Michigan, Maine, California, Idaho, Alabama, Colorado, and New York. The carpentry questionnaire

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Chapter 4 4-7

used the same random set of states as the plaster survey as necessitated by the use of a combined survey

for three of the firms. For six of the firms, entities with SIC codes of 175102, 175105, and 175110

(Carpenters, Window Replacement, and Doors - Hanging and Cutting), were asked the same carpentry

questions.

4.2.1.2 Interior Painting Primary Data Collection (<10 Firms)

Interior Painting Survey Instrument

The script presented in Figure 4-2 was used to administer the phone interviews of representatives from

nine interior painting firms. The introduction served to familiarize contractors with the objectives of the

survey and the nature of EPA’s analysis. Information collected from questions (2) through (5) was used

to estimate the frequency of interior painting events of differing sizes using a scraper for paint removal.

Responses to questions (6) through (8) provide data on the frequency of heat gun usage for paint removal,

and responses to questions (9) through (11) give similar data on the frequency of high-speed machine

usage. Questions (12) and (13) specifically ask about alternatives to high-speed machine paint removal

and the costs of such alternatives. And finally, information collected from questions (14) through (16)

was used to estimate the frequency of removal of trim and molding (of various sizes) during interior

painting jobs.

Figure 4-2: Interior Painting Survey Instrument

Introduction: Hello, I’m _________, calling from Abt Associates. We’re an independent research firm

that is doing contract work for the Environmental Protection Agency (EPA). We’d like to ask you a few

questions in order to better understand how often different paint removal practices are used. Your

responses will be treated as confidential and your name will not be provided to the EPA. There are 16

questions in our survey and we expect it to take about 5 minutes.

If asked why: EPA will be proposing to require dust sampling and/or clearance testing after certain paint

removal practices are used where lead-based paint may be present. We will use the responses to our

survey to estimate how costly these requirements would be.

1. Do you perform interior painting work in buildings built before 1978 for pay?

⁭ Yes ⁭ No (end if no)

2. When you perform a painting job in a residence built before 1978, what percentage of the time do you

use a hand scraper to remove old interior paint?

_______ % of the time.

3. When you use a hand scraper to remove old interior paint in a building built before 1978, what

percentage of the time do you scrape more than 6 square feet per job of a painted surface?

_______ % of the time.

4. When you use a hand scraper to remove old interior paint in a building built before 1978, what

percentage of the time do you scrape more than 60 square feet per job of a painted surface?

_______ % of the time.

5. When you use a hand scraper to remove old interior paint in a building built before 1978, what

percentage of the time do you scrape more than 120 square feet per job of a painted surface?

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Figure 4-2: Interior Painting Survey Instrument

_______ % of the time.

6. When you perform a painting job in a residence built before 1978, what percentage of the time do you

use a heat gun to remove old interior paint?

_______ % of the time.

7. When you use a heat gun to remove old interior paint in a building built before 1978, what percentage

of the time do you remove more than 6 square feet of paint per job of a painted surface?

_______ % of the time.

8. When you use a heat gun to remove old interior paint in a building built before 1978, what percentage

of the time do you remove more than 60 square feet of paint per job of a painted surface?

_______ % of the time.

9. When you perform a painting job in a residence built before 1978, what percentage of the time do you

use a high speed machine such as a power sander, grinder, or planer to remove old interior paint?

_______ % of the time.

10. When you use a high speed machine to remove old interior paint in a building built before 1978, what

percentage of the time do you remove more than 6 square feet of paint per job of a painted surface?

_______ % of the time.

11. When you use a high speed machine to remove old interior paint in a building built before 1978, what

percentage of the time do you remove more than 60 square feet of paint per job of a painted surface?

_______ % of the time.

12. If you could not use high speed machines to remove old interior paint in a building built before 1978,

what alternative paint removal technique would you use instead?

_________________________________.

13. On average, how much would using this alternative to high speed machine paint removal increase

the cost of the job?

$______________.

14. What percentage of your interior painting jobs involve removing or replacing more than 6 square feet

of trim or moldings?

_______ %

15. What percentage of your interior painting jobs involve removing or replacing more than 40 square

feet of trim or moldings?

_______ %

16. What percentage of your interior painting jobs involve removing or replacing more than 80 square

feet of trim or moldings?

_______ %

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Chapter 4 4-9

Interior Painting Survey Responses and Summary of Results

Table 4-4 presents the individual responses from firms contacted from each state for the entire interior

painting questionnaire. For practices for which both an overall frequency question and relative sizespecific frequency questions were asked of firms, the percentage with which each respondent used a

surface preparation practice for a certain size threshold was imputed, and then the average was taken

across respondents. In other cases, the simple averages of the frequencies are used for estimating the

number of events affected by the proposed rule. Summary statistics are calculated in Table 4-5 to show

the central tendency and range of work practice frequencies reported by respondents.

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Table 4-4: Individual Responses to Interior Painting Firm Questionnaire by State

Question LA WV AL ME ID HI KS UT IN

2. Use scraper

(%) 50.0% 5.0% 0.0% 0.0% 0.0% 0.0% 1.0% 1.0% 0.0%

3. Scrape > 6

ft2(%) 10.0% 100.0% NA NA NA NA 0.0% 1.0% NA

4. Scrape > 60

ft2(%) Rarely3 Don’t Know NA NA NA NA 0.0% 0.0% NA

5. Scrape > 120

ft2(%) 0.0% Don’t Know NA NA NA NA 0.0% 0.0% NA

6. Use heat gun

(%) 1.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%

7. Heat gun > 6

ft2(%) 100.0% NA NA NA NA NA NA NA NA

8. Heat gun >

60 ft2(%) 0.0% NA NA NA NA NA NA NA NA

9. Hi-speed

machine (%) 100.0% 0.0% 0.0% 0.0% 0.0% 1.0% 1.0% 0.0% 0.0%

10. Machine >

6 ft2(%) 0.0% NA NA NA NA 100.0% 0.0% NA NA

11. Machine >

60 ft2

(%) 0.0% NA NA NA NA 50.0% 0.0% NA NA

12. Alternative

to hi-speed

machine

Chemical

Stripper NA NA NA NA ChemicalStripper

Take off

chips and

prime over

NA NA

13. Cost of

alternative

At least

15% more

per day

NA NA NA NA $1500 or

$2000 a day Don’t Know NA NA

14. Trim/

moldings > 6

ft2(%)

10.0% 0.0% 5.0% 0.0% 0.0% 30.0% 0.0% 0.0% 1.0%

15. Trim/

moldings > 40

ft2(%)

2.0% 0.0% 0.0% 0.0% 0.0% 30-50% 0.0% 0.0% 0 5%

16. Trim/

moldings > 80

ft2(%)

1.0% 0.0% 0.0% 0.0% 0.0% 10.0% 0.0% 0.0% 0 3%

Imputed Practice Frequencies, by Size Threshold

Total scrape >

6 ft2(%)a5.0% 5.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%

Total scrape >

60 ft2(%)b0.5% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%

Total machine

> 6 ft2(%)c0.0% 0.0% 0.0% 0.0% 0.0% 1.0% 0.0% 0.0% 0.0%

Total machine

> 6 ft2(%)d0.0% 0.0% 0.0% 0.0% 0.0% 0 5% 0.0% 0.0% 0.0%

a. Calculated as the product of responses to Question 2 and Question 3.

b. Calculated as the product of responses to Question 2 and Question 4.

c. Calculated as the product of responses to Question 9 and Question 10.

d. Calculated as the product of responses to Question 9 and Question 11.

3 This firm’s answer of “rarely” was inputted as 1% for calculations of summary statistics. This approach was used because two

other firms, when prompted to assign a percentage value to their response of “rarely” to questions both estimated 1%

frequency.

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Table 4-5: Summary Statistics for Interior Painting Questionnaire

Question Average Median Mode Minimum Maximum

2. Use scraper (%) 6.3% 0.0% 0.0% 0.0% 50.0%

3. Scrape > 6 ft2(%) 27.8% 5.5% None 0.0% 100.0%

4. Scrape > 60 ft2(%) 0.3% 0.0% 0.0% 0.0% 1.0%

5. Scrape > 120 ft2(%) 0.0% 0.0% 0.0% 0.0% 0.0%

6. Use heat gun (%) 0.1% 0.0% 0.0% 0.0% 1.0%

7. Heat gun > 6 ft2(%) 100.0% 100.0% None 100.0% 100.0%

8. Heat gun > 60 ft2(%) 0.0% 0.0% None 0.0% 0.0%

9. Hi-speed machine (%) 11.3% 0.0% 0.0% 0.0% 100.0%

10. Machine > 6 ft2(%) 33.3% 0.0% 0.0% 0.0% 100.0%

11. Machine > 60 ft2(%) 16.7% 0.0% 0.0% 0.0% 50.0%

12. Alternative to hi-speed

machine None None None None None

13. Cost of alternative None None None None None

14. Trim/ moldings > 6 ft2(%) 5.1% 0.0% 0.0% 0.0% 30.0%

15. Trim/ moldings > 40 ft2(%) 4.7% 0.0% 0.0% 0.0% 40.0%

16. Trim/ moldings > 80 ft2(%) 1.3% 0.0% 0.0% 0.0% 10.0%

Imputed Practice Frequencies, by Size Threshold

Total Scrape > 6 ft2(%)a

1.1% 0.0% 0.0% 0.0% 5.0%

Total Scrape > 60 ft2(%)b

0.1% 0.0% 0.0% 0.0% 0.5%

Total Machine > 6 ft2(%)c

0.1% 0.0% 0.0% 0.0% 1.0%

Total Machine > 6 ft2(%)d

0.1% 0.0% 0.0% 0.0% 0.5%

a. Calculated as the product of individual state responses to Question 2 and Question 3.

b. Calculated as the product of individual state responses to Question 2 and Question 4.

c. Calculated as the product of individual state responses to Question 9 and Question 10.

d. Calculated as the product of individual state responses to Question 9 and Question 11.

The event frequency estimates are based on the average of the responses for each question, as calculated from

Table 4-4. The median, mode, minimum, and maximum are only presented for descriptive purposes.

Frequency of Interior Painting Events Requiring Dust Wipe Testing or Clearance

The results from the Interior Painting Firm Questionnaire can be used to estimate the frequency of events

affected by the LRRP Clearance Rule. The frequency of interior painting with scraping are approximated

from the responses to questions (2) through (5). Results from questions (6) through (8) are used to

determine the frequency of interior painting events using a heat gun. Responses from questions (9)

through (11) are used for estimation of the frequency of interior painting events involving use of a highspeed machine for paint removal. Responses from question (14) through (16) regarding removal or

replacement of trim or moldings are used in combination with the two other questionnaires in order to

establish overall trim/molding event frequency, but these questions represent the frequency of paintingspecific trim or molding removal. Table 4-2 summarizes the survey-based estimation methodologies for

interior painting event frequencies affected by the Clearance Rule. The results of two different methods

are displayed: (1) estimating the job-size frequency as a percentage of the assumed practice frequency in

the 2008 analysis, and (2) estimating the job-size frequency as a percentage of the average practice

frequency reported in responses to the Interior Painting Questionnaire (See Table 4-6).

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Table 4-6: Estimation of Dust Wipe Testing and Clearance Event Frequencies for Interior

Painting

Practice Definition Calculation Description Total Number of Eventsa

Dust Wipe Testing Events

Interior Painting with

Scraping

Average of responses to question 2. 6.3% of Interior Painting

Interior Painting with

Scraping > 6 Square Feet

Average of responses imputed from questions 2 and

3.

1.1% of Interior Painting

Interior Painting with

Scraping > 60 Square Feet

Average of responses imputed from questions 2 and

4.

0.1% of Interior Painting

Interior Painting with

Scraping > 120 Square Feet

Average of responses imputed from questions 2 and

5.

None

Interior Painting with Heat

Gun

Average of responses to question 6. 0.1% of Interior Painting

Interior Painting with Heat

Gun > 6 Square Feet

Average of responses imputed from questions 6 and

7.

0.1% of Interior Painting

Interior Painting with Heat

Gun > 60 Square Feet

Average of responses imputed from questions 6 and

8.

None

Removal of Trim or Molding

> 6 Square Feet

Average of responses to question 14. 5.1% of Interior Painting

Removal of Trim or Molding

> 40 Square Feet

Average of responses to question 15. 4.7% of Interior Painting

Removal of Trim or Molding

> 80 Square Feet

Average of responses to question 16. 1.3% of Interior Painting

Clearance Events

Interior Painting with Use of

High-Speed Machine for

Paint Removal

Average of responses to question 9. 11 3% of Interior Painting

Interior Painting with Use of

High-Speed Machine > 6

Square Feet

Average of responses imputed from questions 9 and

10.

0.1% of Interior Painting

Interior Painting with Use of

High-Speed Machine > 60

Square Feet

Average of responses imputed from questions 9 and

11.

0.1% of Interior Painting

a The estimated number of events is based on the average of the responses to the survey questions, as shown in Table 4-5.

4.2.1.3 Carpentry Primary Data Collection (<10 Firms)

Carpentry Survey Instrument

The following script was used for administering phone interviews of six carpentry and three general

contractor firms. The introduction served to familiarize contractors with the objectives of the survey and

the nature of EPA’s analysis. Information collected from questions (1) through (4) was used to estimate

the frequency of window replacement jobs that also involved window frame replacement. Responses to

questions (5) through (12) provide data on the fraction of trim or molding removal activities that exceed

various size thresholds in bathroom or kitchen remodeling jobs. The results of questions (13) and (14)

provide insight into what other renovation events might result in removal of trim or molding.

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Figure 4-3: Carpentry Survey Instrument

Introduction: Hello, I’m _________, calling from Abt Associates. We’re an independent research

firm that is doing contract work for the Environmental Protection Agency (EPA). We’d like to

ask you a few questions in order to better understand how often different practices that sometimes

disturb lead-based paint are used. Your responses will be treated as confidential and your name

will not be provided to the EPA. There are 14 questions in our survey and we expect it to take

about 5 minutes.

If asked why: EPA will be proposing to require dust sampling and/or clearance testing after

certain renovation practices are used that may disturb lead-based paint. We will use the responses

to our survey to estimate how costly these requirements would be.

1. Do you ever perform window replacement work in buildings built before 1978 for pay?

⁭ Yes ⁭ No (if no skip to Q3)

2. What percentage of your Pre-1978 window replacement jobs involve replacing the window

frame?

________ %.

3. Do you ever perform door replacement work in buildings built before 1978 for pay?

⁭ Yes ⁭ No (if no skip to Q5)

4. What percentage of your Pre-1978 door replacement jobs involve replacing the door frame?

________ %.

5. Do you perform kitchen remodeling work in buildings built before 1978 for pay?

⁭ Yes ⁭ No (if no skip to Q7)

6. What percentage of your Pre-1978 kitchen remodeling jobs also involve removing or replacing

more than 6 square feet of trim or moldings?

________ %.

7. What percentage of your Pre-1978 kitchen remodeling jobs also involve removing or replacing

more than 40 square feet of trim or moldings?

________ %.

8. What percentage of your Pre-1978 kitchen remodeling jobs also involve removing or replacing

more than 80 square feet of trim or moldings?

________ %.

9. Do you perform bathroom remodeling work in buildings built before 1978 for pay?

⁭ Yes ⁭ No (if no skip to Q11)

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Figure 4-3: Carpentry Survey Instrument

10. What percentage of your Pre-1978 bathroom remodeling jobs also involve removing or

replacing more than 6 square feet of trim or moldings?

________ %.

11. What percentage of your Pre-1978 bathroom remodeling jobs also involve removing or

replacing more than 40 square feet of trim or moldings?

________ %.

12. What percentage of your Pre-1978 bathroom remodeling jobs also involve removing or

replacing more than 80 square feet of trim or moldings?

________ %.

13. Do you ever replace interior trim or moldings for Pre-1978 jobs that do not also include

interior painting, kitchen remodeling, bathroom remodeling, or wall removal, replacement, or

repair?

⁭ Yes ⁭ No (end survey if no)

14.

a. Please describe these jobs that require interior trim or molding replacement without interior

painting, kitchen remodeling, bathroom remodeling, or wall/repair replacement.

1. ________________________________________________________

2. ________________________________________________________

3. ________________________________________________________

4. ________________________________________________________

b. When performing a Pre-1978{1st type described in 15a} job, what percentage of the time do

you remove trim or moldings?

________ %.

c. When performing a Pre-1978{2nd type described in 15a} job, what percentage of the time do

you remove trim or moldings?

________ %.

d. When performing a Pre-1978{3rd type described in 15a} job, what percentage of the time do

you remove trim or moldings?

________ %.

e. When performing a Pre-1978{4th type described in 15a} job, what percentage of the time do

you remove trim or moldings?

________ %.

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Chapter 4 4-15

Carpentry Survey Responses and Summary of Results

Below, individual responses from firms contacted from each state are presented for the entire

questionnaire in Table 4-7. Also, summary statistics are calculated in Table 4-7 that show the central

tendency and range of work practice frequencies reported by respondents. The averages of the

frequencies will be used for estimating the number of events affected by the proposed rule.

Table 4-7: Individual Responses to Carpentry Questionnaire by State

Question TX IA MI ME CA ID AL CO NY

2. Window frame (%) 100% 15% NA 100% 90% NA 20% 80% 1%

4. Door frame (%) 100% 60% 100% 80% 60% 10-20% 20% 98% 100%

6. Kitchen trim/molding > 6 ft2 NA 15% NA 50% 60% >75% 100% 90% 100%

7. Kitchen trim/molding > 40 ft2 NA 0% NA 10% 20% >75% 100% 50% 100%

8. Kitchen trim/molding > 80 ft2 NA 0% NA 5% 10% >75% 100% 25% 10%

10. Bath trim/molding > 6 ft20% 40% NA 50% 60% 100% 100% 80% 100%

11. Bath trim/molding > 40 ft20% 0% NA 10% 20% >50% 50% 60% 5%

12. Bath trim/molding > 80 ft20% 0% NA 5% 10% 40% 30% 40% 0%

14a. Alternative trim/molding

jobs

NA NA NA NA NA

Replace

baseboards

or interior

casings NA

Restoration

of past

remodeling

Paneling or

sheet rock in

living rooms

14b. Trim/ molding removal (%) NA NA NA NA NA 10% each NA 2% 100%

In the following states, firms with SIC codes of 175102 (Carpenters), 175105 (Window Replacement), and 175110 (Doors –

Hanging & Cutting) were randomly sampled: Texas, Iowa, Michigan, Maine, Idaho, and New York. In Colorado and

California, firms with SIC codes of 152103 (General Contractors), 152105 (Home Improvements), 152115 (Handyman

Services), and 152139 (Remodeling & Repairing Building Contractors), were randomly sampled.

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Table 4-8: Summary Statistics for Carpentry Questionnaire

Question Average Median Mode Minimum Maximum Number

Responses

2. Window frame (%) 58.0% 80.0% 100.0% 1.0% 100.0% 7

4. Door frame (%) 70.3% 80.0% 100.0% 15.0% 100.0% 9

6. Kitchen trim/molding > 6 ft270.0% 75.0% 100.0% 15.0% 100.0% 7

7. Kitchen trim/molding > 40 ft2

50.7% 50.0% 100.0% 0.0% 100.0% 7

8. Kitchen trim/molding > 80 ft2

32.1% 10.0% 10.0% 0.0% 100.0% 7

10. Bath trim/molding > 6 ft266.3% 70.0% 100.0% 0.0% 100.0% 8

11. Bath trim/molding > 40 ft2

24.4% 15.0% 0.0% 0.0% 60.0% 8

12. Bath trim/molding > 80 ft2

15.6% 7.5% 0.0% 0.0% 40.0% 8

14a. Alternative trim/molding

jobs None None None None None 3

14b. Trim/ molding removal (%) 37.3% 10.0% None 2.0% 100.0% 3

The event frequency estimates are based on the average of the responses for each question, as calculated from Table 4-7. The

median, mode, minimum, and maximum are only presented for descriptive purposes.

Frequency of Removal or Replacement of Window or Door Frames and Trim or Molding

Replacement

The results from the Carpentry Questionnaire are used to estimate the frequency of events affected by the

LRRP Clearance Rule. The results from question (2) in the survey are used to estimate the frequency of

removing or replacing the frame during window removal/replacement events. Similarly, responses from

question (4) are used to determine the frequency of door removal/replacement events also requiring

removal of the door frame. The remainder of responses from the Carpentry Survey are used to estimate

the frequency of removal of trim or molding in bathroom and kitchen remodeling jobs (for each size

threshold). Table 4-9 summarizes the survey-based estimation methodologies for window and door event

frequencies affected by the Clearance Rule, and Table 4-10 describes the methodology for estimating

bathroom and kitchen events involving removal of trim or molding.

Table 4-9: Estimation of Frequency of Removal or Replacement of Window or Door Frames

Practice Definition Frequency of Practice a Ratio of Window or

Door Events to Total

Eventsb

Total Number of Dust

Wipe Testing Events

Removal or Replacement of Window

Frame

58.0 % (Question 2) 75.0% Windows 58.0% * 75.0% = 43.5%

of Window/Door Events

Removal or Replacement of Door

Frame

70.0% (Question 4) 25.0% Doors 70.0% * 25.0% = 17.6%

of Window/Door Events

a. The estimated number of events is based on the average of the responses to the survey questions, as shown in Table 4-8.

b. The ratio of window events to door events was derived from data from the 1997 American Housing Survey; for public and

commercial building COFs it is assumed that windows and doors are replaced at the same time, and therefore it is assumed that

frame replacement occurs 70 percent of the time, the higher of the two frame replacement rates

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Table 4-10: Estimation of Dust Wipe Testing Event Frequencies for Trim or Molding Removal in

Kitchen and Bathroom Events

2008 Event Category Practice Definition Frequency of Practice a Total Number of Dust

Wipe Testing Events

Removal of Trim or Molding

> 6 Square Feet 70.0% (Question 6) 70.0% of Kitchen

Removal of Trim or Molding

> 40 Square Feet Kitchen 50.7% (Question 7) 50.7% of Kitchen

Removal of Trim or Molding

> 80 Square Feet 32 1% (Question 8) 32.1% of Kitchen

Removal of Trim or Molding

> 6 Square Feet 66 3% (Question 10) 66.3% of Bathroom

Removal of Trim or Molding

> 40 Square Feet Bathroom 24.4% (Question 11) 24.4% of Bathroom

Removal of Trim or Molding

> 80 Square Feet 15.6% (Question 12) 15.6% of Bathroom

a The estimated number of events is based on the average of the responses to the survey questions, as shown in Table 4-8.

4.2.1.4 Plaster Primary Data Collection (<10 Firms)

Plaster Survey Instrument

The following script was used for administering a phone survey of nine general contractor firms. The

introduction served to familiarize contractors with the objectives of the survey and the nature of EPA’s

analysis. Information collected from questions (1) through (4) is used to estimate the frequency of

window replacement jobs that also involved window frame replacement. Responses to questions (5)

through (12) provide data on the fraction of trim or molding removal activities that exceed varying size

thresholds in bathroom or kitchen remodeling jobs. The results of questions (13) and (14) provide insight

into what other renovation events might result in removal of trim or molding. The purpose of questions

(15) through (19) was to determine how frequently trim or moldings are removed in wall-disturbing

events. And finally, responses to questions (20) through (23) serve to estimate the frequency of

destructive removal of plaster walls in different size increments.

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Figure 4-4: Plaster Survey Instrument

Introduction: Hello, I’m _________, calling from Abt Associates. We’re an independent research firm

that is doing contract work for the Environmental Protection Agency (EPA). We’d like to ask you a few

questions in order to better understand how often different practices that sometimes disturb lead-based

paint are used. Your responses will be treated as confidential and your name will not be provided to the

EPA. There are 23 questions in our survey and we expect it to take about 10 minutes.

If asked why: EPA will be proposing to require dust sampling and/or clearance testing after certain

renovation practices are used that may disturb lead-based paint. We will use the responses to our survey

to estimate how costly these requirements would be.

1. Do you perform wall removal, wall replacement or wall repair work in buildings built before 1978 for

pay?

⁭ Yes ⁭ No (if no, end)

2. What percentage of your Pre-1978 wall removal, wall replacement or wall repair jobs also involve

replacing more than 6 square feet of trim or moldings?

________ %.

3. What percentage of your Pre-1978 wall removal, wall replacement or wall repair jobs also involve

replacing more than 40 square feet of trim or moldings?

________ %.

4. What percentage of your Pre-1978 wall removal, wall replacement or wall repair jobs also involve

replacing more than 80 square feet of trim or moldings?

________ %.

5. What percentage of your Pre-1978 wall removal, wall replacement or wall repair jobs involve

removing all or part of a plaster wall?

________ %.

6. What percentage of the time do you use destructive means, such as a sledgehammer, when you are

removing all or part of a Pre-1978 plaster wall?

________ %.

7. When removing all or part of a Pre-1978 plaster wall using destructive means, what percentage of the

time do you remove more than 6 square feet of plaster wall?

________ %.

8. When removing all or part of a Pre-1978 plaster wall using destructive means, what percentage of the

time do you remove more than 40 square feet of plaster wall?

________ %.

9. When removing all or part of a Pre-1978 plaster wall using destructive means, what percentage of the

time do you remove more than 60 square feet of plaster wall?

________ %.

Plaster Questionnaire Responses and Summary of Results

Below, individual responses from firms contacted from each state are presented for the entire

questionnaire in Table 4-11. For practices for which both an overall frequency question and relative sizespecific frequency questions were asked of firms, the percentage with which each respondent used a work

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practice for a certain size threshold was imputed, and then the average was taken across respondents. In

other cases, the simple averages of the frequencies are used for estimating the number of events affected

by the proposed rule. Summary statistics are also calculated in Table 4-12 to show the central tendency

and range of work practice frequencies reported by respondents. For practices which do not require

combining overall and relative size-specific frequencies as described above, the simple averages of the

frequencies will be used for estimating the number of events affected by the proposed rule.

Table 4-11: Individual Responses to Plaster Questionnaire by State

Question TX IA MI ME CA ID AL CO NY

2. Wall trim/ molding > 6 ft2(%) 30% 40% <5% 50% 40% 100% 100% 100% 10-15%

3. Wall trim/ molding > 40 ft2(%) 10% 40% 0 5% 20% 30% 50% 0% 80% 8-12%

4. Wall trim/ molding > 80 ft2(%) 10% 10% 0% 5% 10% 10% 0% 50-60% 2-3%

5. Plaster wall (%) 30% 2% 1% 5% 0% 0% 0% 100% 70%

6. Destructive means (%) 10% 100% 1% 5% NA NA NA 30% 100%

7. Destructive plaster > 6 ft2(%) 100% Don’t

Know 100% 30% NA NA NA 100% 90%

8. Destructive plaster > 40 ft2

(%) 100% Don’tKnow 10% 15% NA NA NA 80% 90%

9. Destructive plaster > 60 ft2(%) 0% Don’tKnow 1% 10% NA NA NA 70% 90%

Imputed Practice Frequencies, by Size Threshold

Total destructive plaster > 6 ft2(%)a3.0% 0.0% 0.0% 0.1% 0.0% 0.0% 0.0% 30.0% 63.0%

Total destructive plaster > 40 ft2(%)b3.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 24.0% 63.0%

Total destructive plaster > 60 ft2(%)c0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 21.0% 63.0%

a. Calculated as the product of individual state responses to Question 5, Question 6, and Question 7.

b. Calculated as the product of individual state responses to Question 5, Question 6, and Question 8.

c. Calculated as the product of individual state responses to Question 5, Question 6, and Question 9.

For all states, firms with SIC codes of 152103 (General Contractors), 152105 (Home Improvements), 152115 (Handyman

Services), and 152139 (Remodeling & Repairing Building Contractors), were randomly sampled.

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Table 4-12: Summary Statistics for Plaster Questionnaire

Question Average Median Mode Minimum Maximum

2. Wall trim/ molding > 6 ft2(%) 53 1% 40.0% 100.0% 5.0% 100.0%

3. Wall trim/ molding > 40 ft2(%) 26.7% 20.0% 10.0% 0.0% 80.0%

4. Wall trim/ molding > 80 ft2(%) 11.4% 10.0% 10.0% 0.0% 55.0%

5. Plaster wall (%) 23.1%42.0% 0.0% 0.0% 100.0%

6. Destructive means (%) 41.0% 20.0% 100.0% 1.0% 100.0%

7. Destructive plaster > 6 ft2(%) 84.0% 100.0% 100.0% 30.0% 100.0%

8. Destructive plaster > 40 ft2(%) 59.0% 80.0% None 10.0% 100.0%

9. Destructive plaster > 60 ft2(%) 34 2% 10.0% None 0.0% 90.0%

Imputed Practice Frequencies, by Size Threshold

Total destructive plaster > 6 ft2(%)a

10.7% 0.0% 0.0% 0.0% 63.0%

Total destructive plaster > 40 ft2(%)b

10.0% 0.0% 0.0% 0.0% 63.0%

Total destructive plaster > 60 ft2(%)c

9.3% 0.0% 0.0% 0.0% 63.0%

a. Calculated as the product of individual state responses to Question 5, Question 6, and Question 7.

b. Calculated as the product of individual state responses to Question 5, Question 6, and Question 8.

c. Calculated as the product of individual state responses to Question 5, Question 6, and Question 9.

The event frequency estimates are based on the average of the responses for each question, as calculated from

Table 4-11. The median, mode, minimum, and maximum are only presented for descriptive purposes.

Frequency of Plaster Wall Removal Using Destructive Means

Responses from the Plaster Survey are used to estimate the frequency of events affected by the LRRP

Clearance Rule. Table 4-13 displays the plaster questionnaire results from above being used to calculate

event frequencies for the removal or replacement of plaster wall using destructive means. Frequencies are

estimated for various job sizes: greater than 6 square feet, greater than 40 square feet, and greater than 60

square feet.

Table 4-13: Estimation of Frequency of Plaster Removal Using Destructive Means

Practice Definition Calculation Description Total Number of Clearance

Events a

Removal or Replacement of Plaster Wall

> 6 Square Feet Using Destructive

Means

Average of responses imputed from

questions 5, 6, and 7.

10.7% of Wall Removal/Replacement

Removal or Replacement of Plaster Wall

> 40 Square Feet Using Destructive

Means

Average of responses imputed from

questions 5, 6, and 8.

10.0% of Wall Removal/Replacement

Removal or Replacement of Plaster Wall

> 60 Square Feet Using Destructive

Means

Average of responses imputed from

questions 5, 6, and 9.

9.3% of Wall Removal/Replacement

a The estimated number of events is based on the average of the responses to the survey questions, as shown in Table 4-12.

Since wall removals and replacements are only a subset of all wall-disturbing (and other renovation)

events, it is necessary to convert the frequencies above into overall proportions of 2008 LRRP Events.

See Table 4-14 for this conversion.

4 This value is consistent with data from HUD’s 2001 National Survey of Lead and Allergens in Housing, which reports that 31%

of painted walls in pre-1978 housing are plaster. Since not all wall repair jobs require removing all or part of the wall, the

fraction of such jobs removing plaster walls will be less than the percentage of houses with plaster walls.

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Table 4-14: Estimation of Event Frequencies for Removal or Replacement of Plaster Walls Using

Destructive Means

2008 Event

Category

Frequency of

Wall Removal or

Replacementa

Practice Definition Frequency of

Practice b

Total Number of

Clearance Events

Removal/ Replacement of Plaster

Wall > 6 Square Feet Using

Destructive Means

10.7% * 20.0% =

2.1% 2.1% of Kitchen

Removal or Replacement of Plaster

Wall > 40 Square Feet Using

Destructive Means

10.0% * 20.0% =

2.0% Kitchen 20% (AHS, 1997) 2.0% of Kitchen

Removal or Replacement of Plaster

Wall > 60 Square Feet Using

Destructive Means

9.3% * 20.0% = 1.9% 1.9% of Kitchen

Removal or Replacement of Plaster

Wall > 6 Square Feet Using

Destructive Means

10.7% * 21.0% =

2.2%

2.2% of Bathroom

Removal or Replacement of Plaster

Wall > 40 Square Feet Using

Destructive Means

10.0% * 21.0% =

2.1% Bathroom 21% (AHS, 1997) 2.1% of Bathroom

Removal or Replacement of Plaster

Wall > 60 Square Feet Using

Destructive Means

9.3% * 21.0% = 2.0% 2.0% of Bathroom

Removal or Replacement of Plaster

Wall > 6 Square Feet Using

Destructive Means

10.7% * 25.0% =

2.7% 2.7% of Additions

Removal or Replacement of Plaster

Wall > 40 Square Feet Using

Destructive Means

10.0% * 25.0% =

2.5% Additions 25% (AHS, 1997) 2.5% of Additions

Removal or Replacement of Plaster

Wall > 60 Square Feet Using

Destructive Means

9.3% * 25.0% = 2.3% 2.3% of Additions

Removal or Replacement of Plaster

Wall > 6 Square Feet Using

Destructive Means

10.7% * 10.0% =

1.1%

1.1%of WallDisturbing

Removal or Replacement of Plaster

Wall > 40 Square Feet Using

Destructive Means

10.0% * 10.0% =

1.0%

1.0% of WallDisturbing

WallDisturbing 10% (AHS, 1997)

Removal or Replacement of Plaster

Wall > 60 Square Feet Using

Destructive Means

9.3% * 10.0% = 0.9% 0.9%of WallDisturbing

a The frequency represents the share of instances for an event category where a wall is removed or replaced according to

American Housing Survey data. For example, a wall is removed or replaced in 20% of kitchen renovations and 21% of bathroom

renovations. In the case of wall-disturbing events, 10% involve removing or replacing a wall, and the remaining 90% involve

less extensive work, such as cutting a hole in the wall.

b Based on the Frequency of Wall Removal or Replacement in this row, and the Total Number of Clearance Events from Table

4-13

Frequency of Removal of Trim or Molding Replacement During Wall Repair/Replacement

The results from the Plaster Questionnaire can be utilized to estimate the frequency of wall removal or

repair events affected by the trim and molding specifications of the LRRP Clearance Rule.5 The

frequency of removal of greater than 6 square feet of trim or molding in proportion to 2008 total events

can be approximated from question (2) of the plaster survey; the frequency of removal of greater than 40

square feet of trim or molding can be estimated from question (3); and the frequency of removal of

5 These are separate from the trim and molding replacements during kitchen and bathroom renovation events that were estimated

using the Carpentry Questionnaire.

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greater than 80 square feet of trim or molding can be estimated from question (4). Table 4-15 summarizes

the survey-based estimation methodologies for the event frequencies of wall removal or repair requiring

removal of trim or molding.

Table 4-15: Estimation of Frequency of Removal of Trim or Molding for Wall Replacement/Repair

Events

Practice Definition Frequency of Practice a Total Number of Dust Wipe

Testing Events

Removal of Trim or Molding > 6 Square

Feet

53.1% (Plaster Survey, Question 2) 53 1% of Wall Replacement/Repair

Removal of Trim or Molding > 40

Square Feet

26.7% (Plaster Survey, Question 3) 26.7% of Wall Replacement/Repair

Removal of Trim or Molding > 80

Square Feet

11.4% (Plaster Survey, Question 4) 11.4% of Wall Replacement/Repair

a The estimated number of events is based on the average of the responses to the survey questions, as shown in Table 4-12.

As in the estimation of the frequency of removal or demolition of a plaster wall using destructive means,

wall removals and replacements represent only a subset of all wall-disturbing (and other renovation)

events. Therefore, it is necessary to convert the frequencies above into overall proportions of walldisturbing events and additions. This calculation is demonstrated in Table 4-16 below.

Table 4-16: Estimation of Final Event Frequencies for Removal of Trim or Molding

2008 Event

Category

Frequency of

Wall Removal or

Replacement a

Practice Definition Frequency of

Practice b

Total Number of

Dust Wipe Testing

Events

Removal of Trim or Molding > 6

Square Feet

53.1% * 25.0% =

13.3% 13.3% of Additions

Removal of Trim or Molding > 40

Square Feet

26.7% * 25.0% =

6.7% Additions 25% (AHS, 1997) 6.7% of Additions

Removal of Trim or Molding > 80

Square Feet

11.4% * 25.0% =

2.8% 2.8% of Additions

Removal of Trim or Molding > 6

Square Feet

53.1% * 10.0% =

5.3%

5.3% of WallDisturbing

Removal of Trim or Molding > 40

Square Feet

26.7% * 10.0% =

2.7%

2.7% of WallDisturbing

WallDisturbing 10% (AHS, 1997)

Removal of Trim or Molding > 80

Square Feet

11.4% * 10.0% =

1.1%

1.1% of WallDisturbing

a The frequency represents the share of instances for an event category where a wall is removed or replaced according to

American Housing Survey data. A wall is removed or replaced in 25% of additions In the case of wall-disturbing events, 10%

involve removing or replacing a wall, and the remaining 90% involve less extensive work, such as cutting a hole in the wall.

b Based on the Frequency of Wall Removal or Replacement in this row, and the Total Number of Dust Wipe Testing Events from

Table 4-15.

4.2.2 Event Frequencies Based on Secondary Data Sources

4.2.2.1 Cabinet Removal

For cabinet replacement events – which under the proposed Clearance Rule result in additional dust wipe

testing requirements – no primary data collection was used to estimate event frequencies. According to

the 1997 American Housing Survey, 58% of kitchen renovations and 42% of bathroom renovations

involve cabinet replacement. According to HUD (2001) data, 10.5% of kitchen’s have cabinets with an

aggregate area larger than 6 square feet and less than 40 square feet, 27.5% have between 40 and 80

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square feet, and 62 percent have more than 80 square feet. It is assumed that all bathroom cabinet

removal is between 6 and 40 square feet. In order to calculate the exact frequency for each cabinet job

size, the following frequencies are multiplied: the percentage of renovations involving cabinet

replacement, and the percentage of these jobs of a given square footage size threshold. These

computations are presented in Table 4-17 below.

Table 4-17: Estimation of Frequency of Removal of Cabinets

2008 Event Category Practice Definition Frequency of Practice Total Number of Dust

Wipe Testing/ Clearance

Events

Removal of Cabinets > 6

Square Feet

58.0% * 100.0% = 58.0%

58.0% of Kitchen

Removal of Cabinets > 40

Square Feet

58.0% * 89.5% = 51.9%

51.9% of Kitchen Kitchen

Removal of Cabinets > 80

Square Feet

58.0% * 62.0% = 36.0%

36.0% of Kitchen

Removal of Cabinets > 6

Square Feet

42.0% * 100.0% = 42.0%

42.0% of Bathroom

Removal of Cabinets > 40

Square Feet

42.0% * 0.0% = 0.0%

None Bathroom

Removal of Cabinets > 80

Square Feet

42.0% * 0.0% = 0.0%

None

Sources: American Housing Survey (Census 1997) and National Survey of Lead and Allergens in Housing (HUD 2001)

4.2.3 Summary of Event Frequencies

Table 4-18 and Table 4-19 summarize the frequency estimation methodology for all dust wipe testing and

clearance events affected by this revision to the 2008 LRRP Rule, including options for different job size

thresholds.

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Table 4-18: Dust Wipe Testing Renovation Events

Clearance Rule Events Event Frequency Event Estimation Method

Interior Painting With

Scraping a 6.3% of Interior Painting Based on Primary Data Collection from <10 Firms

(>6 sq. ft. per job) 1.1% of Interior Painting Based on Primary Data Collection from <10 Firms

(>60 sq. ft. per job) 0.06% of Interior Painting Based on Primary Data Collection from <10 Firms

(>120 sq. ft. per job) None Based on Primary Data Collection from <10 Firms

Interior Painting With

Heat Gun a 0.1% of Interior Painting Based on Primary Data Collection from <10 Firms

(>6 sq. ft. per job) 0.1% of Interior Painting Based on Primary Data Collection from <10 Firms

(>60 sq. ft. per job) None Based on Primary Data Collection from <10 Firms

Removal of Trim or

Molding b

(> 6 sq. ft. per job)

5.1% of Interior Painting;

70.0% of Kitchen Renovations;

66.3% of Bathroom Renovations;

13.3% of Additions;

5.3% of Wall-Disturbing Events.

Based on Primary Data Collection from <10 Firms

(> 40 sq. ft. per job)

4.7% of Interior Painting;

50.7% of Kitchen Renovations;

24.4% of Bathroom Renovations;

6.7% of Additions;

2.7% of Wall-Disturbing Events.

Based on Primary Data Collection from <10 Firms

(> 80 sq. ft. per job)

1.3% of Interior Painting;

32.1% of Kitchen Renovations;

15.6% of Bathroom Renovations;

2.8% of Additions;

1.1% of Wall-disturbing Events.

Based on Primary Data Collection from <10 Firms

Removal of Cabinets c

(> 6 sq. ft. per job) 58.0% of Kitchen Renovations

42.0% of Bathroom Renovations

Based on data from the 1997 American Housing Survey and

HUD’s 2001 National Survey of Lead and Allergens in

Housing.

(> 40 sq. ft. per job) 51.9% of Kitchen Renovations

Based on data from the 1997 American Housing Survey and

HUD’s 2001 National Survey of Lead and Allergens in

Housing.

(> 80 sq. ft. per job) 36.0% of Kitchen Renovations

Based on data from the 1997 American Housing Survey and

HUD’s 2001 National Survey of Lead and Allergens in

Housing.

Removal or Replacement

of Windows Frames d 43.5% of Window/Door Events Based on Primary Data Collection from <10 Firms

Removal or Replacement

of Door Frames d 17.6% of Window/Door Events Based on Primary Data Collection from <10 Firms

a

Source Table 4-6.

b

Source: Table 4-6, Table 4-10, and Table 4-16.

c

Source: Table 4-17.

d

Source: Table 4-9.

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Table 4-19: Clearance Renovation Events

Clearance Rule Events Event Frequency Event Estimation Method

Plaster – Demolish, or

Remove through

Destructive Means a

(> 6 sq. ft. per job)

2.1% of Kitchen Renovations;

2.2% of Bathroom Renovations;

2.7% of Additions;

1.1% of Wall-Disturbing Events.

Based on Primary Data Collection from <10 Firms

(> 40 sq. ft. per job)

2.0% of Kitchen Renovations;

2.1% of Bathrooms Renovations;

2.5% of Additions;

1.0% of Wall-Disturbing Events.

Based on Primary Data Collection from <10 Firms

(> 60 sq. ft. per job)

1.9% of Kitchen Renovations;

2.0% of Bathroom Renovations;

2.3% of Additions;

0.9% of Wall-Disturbing Events.

Based on Primary Data Collection from <10 Firms

Interior Painting with

High-Speed Machine

Paint Removal b

11.3% of Interior Painting Based on Primary Data Collection from <10 Firms

(> 6 sq. ft. per job) 0.1% of Interior Painting Based on Primary Data Collection from <10 Firms

(>60 sq. ft. per job) 0.1% of Interior Painting Based on Primary Data Collection from <10 Firms

a

Source: Table 4-14

b

Source: Table 4-6

4.2.4 Total Number of Dust Wipe Testing and Clearance Events

This section describes the methodology for applying the event frequencies described above to the

numbers of events estimated for the economic analysis of the 2008 LRRP rule in order to estimate the

number of dust wipe testing and clearance events.

4.2.4.1 Threshold Options for Amount of Painted Surfaces Disturbed

Under the proposed rule, dust wipe testing or clearance would be required after performing certain types

of RRP events where the total amount of painted surfaces disturbed is larger than a specified threshold

(measured in square feet). This analysis includes an analysis of three threshold options:

1. Low Threshold Option

 All event types requiring dust wipe testing where the total job size is larger than

6 square feet.

 Clearance is required for:

- high-speed machine removal of paint larger than 6 square feet, and

- plaster removal using destructive means, larger than 6 square feet.

2. Proposed Threshold Option

 Dust wipe testing is required for:

- cabinet and trim events larger than 40 square feet,

- scraping of paint larger than 60 square feet,

- heat gun removal of more than 6 square feet

- Window frame or door frame removal events

 Clearance is required for:

- high-speed machine removal of paint larger than 6 square feet, and

- plaster removal using destructive means, larger than 6 square feet.

3. High Threshold Option

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 Dust wipe testing is required for:

- cabinet and trim events larger than 80 square feet,

- scraping or heat gun removal of paint larger than 120 square feet, and

- window frame or door frame removal events.

 Clearance is required for:

- high-speed machine removal of paint larger than 60 square feet, and

- plaster removal using destructive means, larger than 60 square feet.

For units undergoing regulated RRP activities, the number of events requiring either dust wipe testing or

clearance was estimated. Table 4-20 presents these event types, the areas in which they occur, the type of

cleaning verification required, and the size thresholds relevant to each.

Table 4-20: Event Types Requiring Dust Wipe Testing and Clearance by Size Threshold

Event Area Threshold

Event Type Bath Kit Add Wall WD Paint Activity Low Proposed High

Cabinet

Removal X X DWT 6 40 80

Trim/Molding

Removal X X X X X DWT 6 40 80

Window / Door

Frame Removal

X DWT n/a n/a n/a

Painting w/

Scraping X DWT 6 60 120

Painting w/

Heat Gun X DWT 6 6 60

Paint Removal

w/ High-Speed

Machine

X DWT & C 6 6 60

Plaster

Removal w/

Destructive

Means

X X X X DWT & C 6 6 60

Bath = Bathroom renovation; Kit = Kitchen renovation; Add = Addition; Wall = Wall disturbing event; WD = window

frame or door frame event; Paint = Interior Painting

DWT = Dust Wipe Testing

C = Clearance

As shown in the table, window and door frame removal events do not have size thresholds associated with

them. It is assumed that any window or door frame removal event will require dust wipe testing, though

the necessary amount of dust wipe testing will be dependent on the number of rooms in the work area.

For bathroom cabinet removal events, all such events were assumed to disturb between 6 and 40 square

feet of cabinetry.

4.2.4.2 Estimating the Number of Dust Wipe Testing and Clearance Events

Three pieces of information were necessary to estimate the number of dust wipe testing and clearance

events for each option: (1) the probability that an event occurs above the specified size threshold, (2) the

mutually exclusive probability that an event only occurs in a single room within a unit and where no

other event occurs within that unit, and (3) the joint probability that either an event occurs in multiple

rooms within a unit or with any combination of other events within the unit. The determination of

mutually exclusive and joint events has two components: (1) the event type (e.g., cabinet removal), and

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(2) the room in which the event takes place (e.g., bathroom). A mutually exclusive event is defined as a

single event type occurring only in a single room within a unit, given that no other event types occur.

Conversely, a joint event could be any combination of event types occurring within the same unit, or any

combination of a single event type occurring in multiple rooms within the unit. The probabilities that

events occur above different size thresholds are described in sections 4.2.1, 4.2.2, and 4.2.3

Avoiding Double Counting

Calculating the mutually exclusive and joint probabilities for all event types was necessary to avoid

double counting. For example, it was estimated that cabinets and trim are replaced during 32.8% and

66.3% of bathroom remodeling events, respectively. Simply multiplying the number of bathroom

remodeling events by the sum of these probabilities (99.1%) to estimate the number of dust wipe testing

events due to cabinet or trim replacement will double count instances where cabinets and trim were

replaced at the same time. In cases such as this, two event types occur in the same room of a single unit.

The unit should therefore only be counted once. Other joint events consist of one or more event types

occurring in multiple rooms of a single unit. For example, a bathroom cabinet removal event and a

kitchen trim removal event may occur during a single job. As in the previous example, simply

multiplying the probabilities of a bathroom cabinet removal and of a kitchen trim removal by the number

of units where bathrooms and kitchens are remodeled would count such multiple-event jobs twice.

To avoid double counting multiple-event units, the probability of a unit having a mutually exclusive event

is added to the probability of a unit having joint events. In the simplified case of two events types, E1 and

E2, with probabilities that each occur, p1 and p2, respectively, the total number of affected units can be

calculated as follows:

(1) Probability of each event occurring by itself:

Probability of E1 only: p1(only) = p1 * (1 – p2)

Probability of E2 only: p2(only) = p2 * (1 – p1)

(2) Probability of both events occurring together:

Probability of E1 and E2: p1,2(joint) = p1 * p2

(3) Total number of units where E1 and/or E2 occur:

Affected units = u * ( p1(only) + p2(only) + p1,2(joint) )

Where:

u = the number of units where E1 or E2 could occur

Although this example has two event types, the methodology can be extended to determine the number of

affected units for any number of event types and rooms in which events occur. Note that for these

calculations the analysis relies on the simplifying assumption that these joint probabilities are

independently distributed. In reality, these activities are more likely to occur together. Therefore, this

simplifying assumption introduces an upward bias to estimates of the number of dust wipe and clearance

events, but the magnitude of this bias is unknown.

Grouping Events into Options by Size

This analysis evaluates three threshold options for triggering the dust wipe testing and clearance

requirements of the rule. The proposed clearance rule sets thresholds that are specific to the entire job (as

opposed to being a component-specific threshold). Thus, it is possible that two smaller renovation tasks

occurring in the same unit could trigger the rule’s requirements, even if the tasks would not exceed the

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threshold when being performed in isolation. The tasks defined in this analysis that may contribute

toward the same threshold requirements are as follows:

 Removing more than 40 square feet of trim, molding, cabinets, or other fixtures

o Replace kitchen cabinets

o Replace bathroom cabinets

o Replace kitchen trim

o Replace bathroom trim

o Replace trim during painting

o Replace trim during addition

o Replace trim during other wall disturbing event

 Demolition, or removal through destructive means, of more than 6 square feet of plaster and lath

building component

o Destructive removal of plaster and lath building component during kitchen remodel

o Destructive removal of plaster and lath building component during bathroom remodel

o Destructive removal of plaster and lath building component during an addition

o Destructive removal of plaster and lath building component during another walldisturbing event

Thus, in order to calculate whether an entire job exceeded the applicable threshold it was assumed that the

average size for a particular task is the midpoint between consecutive size thresholds. For example, an

average size of 23 square feet was assumed for a bathroom cabinet removal event, the midpoint between 6

and 40 square feet.

Based on this assumption, the amount of painted surfaces disturbed was combined for multiple-event jobs

to determine whether the events exceed the thresholds. For example, suppose a unit undergoes both

bathroom cabinet and kitchen cabinet removal events that are between 6 and 40 square feet. Because the

estimated total job size is greater than 40 square feet (23 plus 23 equals 46), this job is assumed to exceed

the proposed threshold option.

Determining Maximum Room Area Size

As in the estimation of work area sizes for the 2008 LRRP rule, the size of the work area requiring dust

wipe testing after a multiple-event job is assumed to be equal to the maximum work area size of the

individual events. This assumption accounts for the overlap of different renovation activities occurring

within the same unit (for example, replacing cabinets and re-painting a kitchen). Bathroom and kitchen

events are exceptions because they are separate rooms within a unit and thus cannot overlap; the sum of

their work areas is compared to other event sizes. For example, if the sum of a bathroom and kitchen

event is 208 square feet and a 112 square foot painting event is also occurring in the same unit, it is

assumed that the painting was performed in the bathroom and kitchen; therefore, the event size would be

208 square feet.

4.2.4.3 Total Number of Dust Wipe Testing and Clearance Events

The analysis calculated the probabilities for all possible combinations of event types and sizes. These

probabilities were then applied to the estimates of units performing events compliant with the 2008 LRRP

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rule and 2009 proposed opt-out rule requirements. The resulting data included the number of units

requiring dust wipe testing or clearance for each size threshold option.

These data were then grouped by the maximum work area sizes to determine the appropriate allocation of

dust wipe testing or clearance costs.6 Testing costs are dependent on work area size, as larger work areas

require more dust wipe tests and more re-cleaning when necessary.

Testing costs also depend on the probability that a floor is carpeted because the proposed rule only

requires dust wipe tests for uncarpeted floors. As the probability that a floor is carpeted differs for

bathrooms and kitchens compared to events performed in other rooms, it was necessary to distinguish

between bathroom, kitchen, and other events. In addition, firms performing RRP work in renter-occupied

property will incur different paperwork costs than firms performing work in owner-occupied buildings

under the proposed LRRP clearance rule, because the dust wipe testing report must be provided to both

the owner and the occupant.

Table 4-21 through Table 4-24 present the resulting number of events for dust wipe testing and clearance.

Events are presented by building tenure, building type, work area size, and occurrence of a bathroom or

kitchen event. Note that events in public and commercial building COFs are always assumed to exceed

the highest size threshold option. Table 4-25 presents the total number of dust wipe testing and clearance

events for by the type of activity triggering the dust wipe testing or clearance requirements.

6 The work area sized utilized in this analysis were estimated for EPA’s analysis of the 2008 LRRP rule, and are shown below in

Table 4-40 through Table 4-49.

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Table 4-21: Target Housing Events (thousands): First Year, Low Threshold Option

Dust Wipe Testing Clearance Total Size SF-O MF-O SF-R MF-R SF-O MF-O SF-R MF-R SF-O MF-O SF-R MF-R Total

Events Excluding Kitchen or Bathroom

Bath 34 2 21 21 7.8 0.4 4.8 4.7 41 2 26 25 94

Kit 102 6 33 31 1.5 0.1 0.2 0.2 104 6 33 31 173

Bath+Kit 1 0 0 0 0.3 0.0 0.0 0.0 1 0 0 0 2

S-Paint 53 3 25 38 1.3 0.1 0.5 0.8 55 3 25 39 122

M-Paint 28 2 14 24 0.5 0.0 0.2 0.4 28 2 14 25 69

L-Paint 26 1 13 23 0.4 0.0 0.2 0.4 26 2 14 24 65

S-WD 96 5 32 30 0.3 0.0 0.1 0.0 96 5 32 30 163

L-WD 101 6 32 31 0.6 0.0 0.1 0.1 101 6 32 31 171

Subtotal 441 25 170 199 12.6 0.6 6.2 6.6 453 25 176 205 860

Events Including Kitchens or Bathrooms

Bath 97 4 149 89 3.7 0.2 5.8 3.3 101 4 155 93 353

Kit 116 7 141 149 4.5 0.2 4.5 4.7 121 7 145 154 427

Bath+Kit 35 4 87 31 2.7 0.3 6.3 2.1 37 5 93 33 168

S-Paint 4 0 6 3 0.2 0.0 0.3 0.2 5 0 6 4 15

M-Paint 5 0 4 5 0.3 0.0 0.2 0.3 5 0 4 6 15

L-Paint 2 0 5 2 0.2 0.0 0.4 0.1 2 0 5 2 9

S-WD 6 0 5 0 0.2 0.0 0.2 0.0 6 0 5 0 11

L-WD 16 1 10 5 0.8 0.0 0.4 0.2 17 1 10 5 33

Subtotal 281 17 405 285 12.7 0.8 18.1 10.8 294 18 423 296 1,030

All Events

Total 722 42 574 483 25.3 1.4 24.3 17.4 747 43 599 501 1,890

The following abbreviations are used: SF-O indicates single-family owner-occupied; MF-O indicates multi-family

owner-occupied; SF-R indicates single-family renter-occupied; MF-R indicates multi-family renter-occupied; Bath

indicates a bathroom size event; Kit indicates a kitchen size event, Bath+Kit indicates an event the size of a bathroom

and a kitchen combined; S-Paint indicates a small painting sized event; M-Paint indicates a medium painting sized

event; L-Paint indicates a large painting sized event; S-WD indicates a small window/door sized event; L-WD

indicates a large window/door sized event.

A “bathroom size” or “kitchen size” indicates the event size, not the event type. In addition to bathroom and kitchen

events, other event types having these size definitions are:

Bathroom size: wall-disturbing events, addition events

Kitchen size: wall-disturbing events, addition events, window/door replacements

Bathroom + kitchen size: wall-disturbing events, addition events

“0” and “0.0” indicate more than zero but fewer than 500 and 50 events respectively.

Events excluding kitchens or bathrooms are calculated separately from events including kitchens and bathrooms,

because kitchens and bathrooms have a different probability of being carpeted than the rest of the house, and dust wipe

samples are only taken on uncarpeted floors.

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Table 4-22: Target Housing Events (thousands): First Year, Proposed Option

Dust Wipe Testing Clearance Total Type SF-O MF-O SF-R MF-R SF-O MF-O SF-R MF-R SF-O MF-O SF-R MF-R Total

Events Excluding Kitchen or Bathroom

Bath 17 1 11 10 8 1 0.4 5 3 4.9 25 1 16 15 58

Kit 104 6 35 32 1.7 0.1 0 3 0.3 106 6 35 32 179

Bath+Kit 1 0 0 0 0 3 0.0 0 1 0.0 1 0 0 0 1

S-Paint 42 2 19 30 1 2 0.1 0 5 0.8 43 2 20 31 96

M-Paint 22 1 11 19 0 5 0.0 0 2 0.4 22 1 11 19 54

L-Paint 20 1 10 18 0.4 0.0 0 2 0.4 21 1 11 19 51

S-WD 101 6 34 31 0 3 0.0 0 1 0.0 101 6 34 31 172

L-WD 104 6 35 32 0.6 0.0 0 1 0.1 105 6 35 32 178

Subtotal 410 23 155 173 13.2 0.6 6.9 6.9 424 24 162 180 789

Events Including Kitchens or Bathrooms

Bath 52 2 80 48 3 5 0.2 5 5 3.1 56 2 86 51 195

Kit 102 6 124 133 4.4 0.2 4.6 4.8 106 6 128 137 379

Bath+Kit 35 5 87 31 2.6 0.3 6 1 2.0 38 5 93 33 169

S-Paint 4 0 5 3 0 2 0.0 0 2 0.1 4 0 5 3 12

M-Paint 4 0 3 4 0 2 0.0 0 1 0.2 4 0 3 5 12

L-Paint 2 0 4 1 0 1 0.0 0 3 0.1 2 0 4 1 8

S-WD 3 0 3 0 0 2 0.0 0 2 0.0 3 0 3 0 6

L-WD 13 1 7 4 0.8 0.0 0.4 0.2 13 1 8 4 26

Subtotal 215 14 313 224 12.1 0.8 17.4 10.5 227 15 331 234 807

All Events

Total 625 37 468 397 25 3 1.4 24 3 17.4 650 39 493 414 1,596

The following abbreviations are used: SF-O indicates single-family owner-occupied; MF-O indicates multi-family

owner-occupied; SF-R indicates single-family renter-occupied; MF-R indicates multi-family renter-occupied; Bath

indicates a bathroom size event; Kit indicates a kitchen size event, Bath+Kit indicates an event the size of a bathroom

and a kitchen combined; S-Paint indicates a small painting sized event; M-Paint indicates a medium painting sized

event; L-Paint indicates a large painting sized event; S-WD indicates a small window/door sized event; L-WD

indicates a large window/door sized event.

A “bathroom size” or “kitchen size” indicates the event size, not the event type. In addition to bathroom and kitchen

events, other event types having these size definitions are:

Bathroom size: wall-disturbing events, addition events

Kitchen size: wall-disturbing events, addition events, window/door replacements

Bathroom + kitchen size: wall-disturbing events, addition events

“0” and “0.0” indicate more than zero but fewer than 500 and 50 events respectively.

Events excluding kitchens or bathrooms are calculated separately from events including kitchens and bathrooms,

because kitchens and bathrooms have a different probability of being carpeted than the rest of the house, and dust wipe

samples are only taken on uncarpeted floors.

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Table 4-23: Target Housing Events (thousands): First Year, High Threshold Option

Dust Wipe Testing Clearance Total Type SF-O MF-O SF-R MF-R SF-O MF-O SF-R MF-R SF-O MF-O SF-R MF-R Total

Events Excluding Kitchen or Bathroom

Bath 7 0 5 4 7 5 0.4 5.0 4.5 15 1 9 9 34

Kit 108 6 37 33 1.7 0.1 0 3 0.3 109 6 37 33 186

Bath+Kit 0 0 0 0 0 3 0.0 0 2 0.0 1 0 0 0 1

S-Paint 12 1 5 8 0 5 0.0 0 3 0.4 12 1 6 9 27

M-Paint 6 0 3 5 0 2 0.0 0 1 0.2 6 0 3 5 14

L-Paint 5 0 3 5 0 2 0.0 0 1 0.2 5 0 3 5 13

S-WD 106 6 37 33 0 3 0.0 0 1 0.0 107 6 37 33 182

L-WD 107 6 37 33 0 5 0.0 0 1 0.1 108 6 37 33 184

Subtotal 351 20 126 121 11.3 0.5 6.1 5.7 363 20 132 127 642

Events Including Kitchens or Bathrooms

Bath 25 1 38 22 3.0 0.1 4.8 2.7 28 1 43 25 97

Kit 84 5 102 110 3.7 0.2 4 2 4.2 87 5 106 114 312

Bath+Kit 32 4 80 29 2 1 0.3 4.8 1.6 34 4 85 30 154

S-Paint 3 0 4 3 0 1 0.0 0 2 0.1 4 0 5 3 11

M-Paint 4 0 3 4 0 2 0.0 0 1 0.1 4 0 3 4 12

L-Paint 2 0 4 1 0 1 0.0 0 2 0.1 2 0 4 1 8

S-WD 2 0 1 0 0 2 0.0 0 1 0.0 2 0 1 0 3

L-WD 10 1 6 3 0.7 0.0 0.4 0.2 10 1 6 3 20

Subtotal 161 11 238 172 10.0 0.7 14.7 9.0 171 12 253 181 617

All Events

Total 512 31 364 293 21.4 1.2 20 9 14.6 534 32 385 307 1,258

The following abbreviations are used: SF-O indicates single-family owner-occupied; MF-O indicates multi-family

owner-occupied; SF-R indicates single-family renter-occupied; MF-R indicates multi-family renter-occupied; Bath

indicates a bathroom size event; Kit indicates a kitchen size event, Bath+Kit indicates an event the size of a bathroom

and a kitchen combined; S-Paint indicates a small painting sized event; M-Paint indicates a medium painting sized

event; L-Paint indicates a large painting sized event; S-WD indicates a small window/door sized event; L-WD

indicates a large window/door sized event.

A “bathroom size” or “kitchen size” indicates the event size, not the event type. In addition to bathroom and kitchen

events, other event types having these size definitions are:

Bathroom size: wall-disturbing events, addition events

Kitchen size: wall-disturbing events, addition events, window/door replacements

Bathroom + kitchen size: wall-disturbing events, addition events

“0” and “0.0” indicate more than zero but fewer than 500 and 50 events respectively.

Events excluding kitchens or bathrooms are calculated separately from events including kitchens and bathrooms,

because kitchens and bathrooms have a different probability of being carpeted than the rest of the house, and dust wipe

samples are only taken on uncarpeted floors.

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Table 4-24: Public and Commercial Building COF Events: First Year, All Options

Building Type Dust Wipe Testing Clearance Total

Kindergarten (Public) 158 35 192

Kindergarten (Large Private) 23 5 27

Kindergarten (Small Private) 27 6 32

Pre-K + Kindergarten (Public) 123 27 150

Pre-K + Kindergarten (Large Private) 67 15 82

Pre-K + Kindergarten (Small Private) 34 7 41

Daycare Center (Renter-Occupied) 171 37 208

Daycare Center (Owner-Occupied) 117 26 142

Daycare Center (Non-Profit who performs

some of own RRP) 149 32 181

Daycare Center (Non-Profit who uses

contractors) 55 12 67

Daycare Center (In Public School) 8 2 10

Daycare Center (In Large Private School) 0 0 0

Daycare Center (In Small Private School) 0 0 0

All Events 930 203 1,134

Note: A zero indicates that fewer than one event is performed annually.

Table 4-25: Total First Year Events by Event Type

Low Threshold Proposed Threshold High Threshold

Event Type

Target

Housing

Public

and Com.

Bldg.

COF Total

Target

Housing

Public

and Com.

Bldg.

COF Total

Target

Housing

Public

and Com.

Bldg.

COF Total

Dust Wipe Testing Events

Heat gun, < 1000

degrees 3,633 1 3,635 3,799 1 3,800 - 1 1

Window/door

frame removal 483,244 663 483,907 512,852 663 513,515 543,863 663 544,526

Scraping 39,964 89 40,053 2,089 89 2,179 - 89 89

Trim, molding,

cabinet removal 687,319 176 687,495 436,450 176 436,626 206,915 176 207,092

Multiple activity

eventsa607,308 - 607,308 572,232 - 572,232 449,293 - 449,293

Subtotal, dust wipe

testing 1,821,468 930 1,822,398 1,527,422 930 1,528,353 1,200,071 930 1,201,002

Clearance Events

High speed paint

removal 3,633 160 3,793 3,799 160 3,959 2,027 160 2,187

Plaster demolition

through destructive

means 21,097 43 21,140 28,703 43 28,746 31,094 43 31,137

Multiple activity

eventsa

43,704 - 43,704 35,932 - 35,932 24,959 - 24,959

Subtotal, clearance

events 68,434 203 68,637 68,434 203 68,637 58,079 203 58,283

Total, All Event

Types 1,889,902 1,134 1,891,036 1,595,856 1,134 1,596,990 1,258,151 1,134 1,259,284

a Multiple event types occurring during the course of a single job (e.g., a renovation with both window frame removal

and trim removal). Because the probability of multiple-activity events varies with the size threshold, the number of

events for single-event activities is not consistent across size thresholds.

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Chapter 4 4-34

4.3 Costs of Dust Sampling and Clearance

Two requirements of the proposed LRRP Clearance Rule that have cost implications are: (1) a

requirement to perform dust wipe testing for a subset of RRP activities, and (2) a requirement to perform

dust wipe testing and achieve clearance for a second subset of RRP activities where the quantity of lead

dust and the characteristics of the dust make it hard to clean up. Figure 4-5 presents a summary of the

dust wipe testing and clearance requirements.

This section outlines a methodology for estimating the costs of these requirements under the proposed

LRRP Clearance Rule and presents the resulting total costs. First, the cost of using a third party to

perform dust wipe testing services following certain RRP events is estimated. Next, firm costs associated

with dust wipe testing when the firm’s own dust sampling technician is used are described. Re-cleaning

cost estimates and clearance failure rates for different surfaces are also presented. Finally, these costs are

combined to determine the total cost of dust wipe testing and clearance requirements for all applicable

events.

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Figure 4-5: Summary of Required Activities for Performing Dust Wipe Testing and Clearance

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Chapter 4 4-36

4.3.1 Costs of Renovation Firm and Third Party Dust Wipe Testing

In order to estimate the costs of conducting dust wipe testing following RRP activities, EPA administered

a questionnaire to nine lead evaluation firms that included questions about what the firms would charge to

perform dust wipe testing and what the labor requirements and laboratory costs would be for performing

the testing. The sampling procedure for lead evaluation firm selection is discussed below. The

questionnaire and a description of the purpose of each question are also provided. The final section

outlines the results of the survey.

4.3.1.1 Lead Evaluation Firm Sample Universe

To draw the sample of lead evaluation firms, nine states were randomly selected while limiting the

sample selection to no more than one state per EPA region. In addition, states were selected such that at

least one and no more than two states would have lead abatement and evaluation programs administered

by EPA.7 The nine states selected according to these criteria were: Minnesota, Idaho, Georgia, Maine,

Colorado, Oklahoma, Virginia, Kansas, and New Jersey. Idaho was the state selected with a lead-based

paint program administered by EPA.8

Once the nine states were selected, lists of lead evaluation firms from state program websites were

obtained and contractors were randomly called until a firm from each selected state agreed to complete

the questionnaire. One outlier response was removed from the analysis. This was the first firm that

completed the questionnaire, and the survey instrument completed by this firm asked about the cost for

taking dust wipe samples, analyzing them, and providing a short report. This firm reported extremely

high costs and a substantial amount of the costs were related to providing the report. Because the firm

appears to have erroneously concluded that an exhaustive report would be required, the wording of the

questionnaire for subsequent respondents was changed from “short report” to “one-page report.” The cost

estimates provided by the subsequent respondents were an order of magnitude lower than those from the

first respondent. Since the first firm’s estimates appear to be uncharacteristically high due in part to this

difference in wording, their responses were dropped from the analysis. Simple averages were calculated

for each question across the eight remaining responses in order to estimate the necessary parameters.

4.3.1.2 Script for Lead Evaluation Firm Questionnaire

Figure 4-1 presents the script used in the survey of lead evaluation firms. The introduction served to

familiarize firms with the objectives of the survey and the nature of EPA’s proposed rule revision.

Information collected in question (1) provides a basis for estimating the costs of third party testing. Third

party testing may be used in some cases – even if it is not required – because it will be less expensive for

renovation firms that perform RRP events infrequently enough that the cost of certifying a dust sampling

technician is not justified. Information collected in questions (2) and (3) allow estimation of the costs of

dust wipe testing by the renovation firm. The cost is the labor time multiplied by the renovator wage rate,

plus lab fees, plus the cost of materials, plus the cost of shipping samples to the lab. Information

collected in questions (4) and (5) provide information about the amount of lead time currently needed

before conducting a third party inspection and the amount of time it takes to get test results back after dust

sampling, but these questions were not used in this cost analysis.

7, 8

24% of all states have a lead-based paint certification program administered by the EPA.

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Figure 4-6: Lead Evaluation Firm Survey Instrument

Introduction: Hello, I’m _________, calling from Abt Associates. We’re an independent research

firm that is doing contract work for the Environmental Protection Agency (EPA). We’d like to

ask you a few questions in order to better understand how much it might cost to perform dust

clearance testing after renovation activities. EPA will be proposing to require dust sampling

and/or clearance testing after certain renovation practices are used that may disturb lead-based

paint. We will use the responses to our survey to estimate how costly these requirements would

be. Your responses will be treated as confidential and your name will not be provided to the

EPA. There are 5 questions in our survey and we expect it to take less than 5 minutes.

Screen Q1: Does your firm perform lead evaluation such as dust sampling?

⁭ Yes ⁭ No (end survey if no)

Screen Q2: Are you knowledgeable about the costs of performing some of these services?

⁭ Yes {Skip to (1) if Yes.}⁭ No

Screen Q3: Is there someone there I could speak with who is knowledgeable about the costs

of performing some of these services?

⁭ Yes {re-read intro and skip to (1)}⁭ No

Screen Q4: Is there another time I could call back to speak with someone who is

knowledgeable about the costs of performing some of these services?

⁭ Yes: __________________________ ⁭ No (end survey)

(1) What would you charge to take four dust wipe samples (one window trough, one

window sill, and two floor samples), have them sent in and analyzed by the lab, and

provide a 1-page report to the contractor?

$________.

a. How much extra would it cost per additional dust wipe sample?

$________.

b. How much would it cost for only two dust wipe samples (window sill and

trough)?

$________.

(2) What would the lab portion of the above costs be?

$________.

(3) Excluding travel time, how much labor time would be required to take four

samples, send them to the lab, and provide a report to the contractor?

____ hours.

(4) How much time would it take between sampling and receiving the lab results?

____ days.

(5) How much lead time would your firm need to get an inspector to the site?

____ days.

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Chapter 4 4-38

4.3.1.3 Lead Evaluation Firm Responses and Summary of Results

Individual survey responses are presented by state in Table 4-1. The table also presents summary

statistics showing the average and range of dust wipe testing cost responses.

Table 4-26: Summary of Responses to Lead Evaluation Firm Questionnaire by State

(1) (1a) (1b) (2) (3) (4) (5)

Individual Responses

Colorado $250-$350 $20 $180-$200 $20/sample 2 hours 24 hours 2 hours - 1

day

Georgia $500 $25 $425-$450 $25/sample 5 hours 3-5 business

days

1-2 business

days

Idaho $1800-$2000 $150 $1500-$1800 $50/sample 8-15 hours 10 working

days

1 day-1

week

Kansas $450 $20 $400 $135 total

($20/sample)

3 hours 3 days 2 days

Maine $225 $20 $190 $20/sample 20 minutes 48 hours 24 hours

Minnesota $175-$200 $45 $85-$100 $15 plus

$5/sample

2 hours 1 day 1-2 business

days

New Jersey $175 $20 $135 $20/sample 10 minutes 4-5 business

days

1-2 days

Oklahoma $110 $8.50 $92 $8.50/sample 1 hour 3 days 1 hour

Virginia

$150

$50 “Just

different lab

costs”

Don’t Know 30/40

minutes - 1

hour

1 week “several

days”

Summary Statistics

Median $225 $20 $190 $20/sample 2 hours 3 days 1.5 days

Mean1$262 $26 $220 $19/sample 1 hour, 45

minutes 3 days 1.5 days

Mode N A. $20 $190 $20/sample 2 hours 1 day 1.5 days

Minimum $110 $9 $92 $9/sample 10 minutes 1 day 1 hour

Maximum1$1900 $150 $1650 $50/sample 12 hours 7 days 4 days

Maximum2$500 $50 $438 $25/sample 5 hours 5 hours 4 days

1. Excludes the response from the firm in Idaho that was provided before the questionnaire was reworded.

4.3.2 Costs of Third Party Dust Wipe Testing and Clearance

Responses to question 1 are used to estimate how much it would cost renovation firms to hire third-party

lead evaluation firms to perform dust wipe testing in order to comply with the LRRP Clearance Rule.

The total cost of collecting, analyzing, and reporting four dust wipe samples as well as the marginal cost

per additional sample were estimated. As shown in Table 4-27 below, third-party dust wipe testing costs

are split into fixed and variable costs.

Table 4-27: Fixed and Variable Costs of Dust Wipe Sampling

Total Cost for Four Dust Wipes Additional Cost per Wipe Fixed Costs of Dust Wipe Testing

$262 (Question 1) $26 (Question 1a.) $262 minus four times $26 = $158

Using the information on fixed and variable costs of dust wipe sampling, the costs of third-party lead dust

wipe testing is estimated, as illustrated in Table 4-28Error! Reference source not found..

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Table 4-28: Summary of Per-Event Costs for Events with Third Party Dust Wipe Testing

Event

Type

(A) Fixed Cost Per Event (B) Number of

Samplesa

(C) Marginal

Cost Per

Sample

(D) Re-cleaning Costs Total

Dust

Wipe

Testing

Events

Estimated as the sum of:

 third party dust wipe

testing costs ($158 from

Question 1 and Question

1a)

 photocopy costs

 shipping costs ($4.95

per occupant or owner

for priority mail)

 shipping labor (5

minutes)

Estimated as the sum of:

(1) the number of

windows multiplied by

two samples, (2) the

number of rooms

multiplied by the

likelihood of noncarpeted floors, and (3)

one sample outside the

work area.

$26 third party

dust wipe

testing costs

(Question 1a)

None

The sum of: the

fixed event cost

(A), and the

estimated

number of

samples (B)

times the

marginal cost

(C).

Clearance

Events

Estimated as the sum of:

 third party dust wipe

testing costs ($158 from

Question 1 and Question

1a) multiplied by the

expected number of

clearance tests

 photocopy costs

multiplied by the

expected number of

clearance tests

 shipping costs ($4.95

per occupant or owner

for priority mail)

 shipping labor (5

minutes)

Estimated as the sum of:

(1) the product of the

number of windows, two

samples per window,

and one plus the

combined first and

second failure rate, (2)

the product of the

number of rooms, the

likelihood of noncarpeted floors, and one

plus the combined first

and second failure rates,

and (3) one sample

outside the work area.

$26 third party

dust wipe

testing costs

(Question 1a)

The sum of the following

costs: floor labor and material

re-cleaning costs times the

floor clearance failure rate; sill

labor and material re-cleaning

costs times the sill clearance

failure rate; trough labor and

material re-cleaning costs

times the trough clearance

failure rate; travel costs times

the combined clearance failure

rate.

The sum of: the

fixed event cost

(A), the

estimated

number of

samples (B)

times the

marginal cost

(C), and recleaning costs

(D).

a

For events in schools where there are more than four rooms affected, dust wipe samples are assumed to be taken from only four rooms.

For clearance events where there are more than four rooms affected (10.3 classrooms for schools with kindergartens and 13.2 classrooms for

schools with kindergartens and pre-kindergartens), the initial dust wipe samples are assumed to be taken from only four rooms. If all dust wipe

samples show results below clearance levels, there is no re-cleaning. If any sample of a given type (i.e., sill, trough, or floor) fails the clearance

test, the failed surface must be re-cleaned, and all other surfaces of the same type in the untested rooms are assumed to be re-cleaned. In the

event of a first-round failure, exactly four dust wipe samples of the type(s) that failed are assumed to be taken. They will include the failed

surfaces plus additional samples as necessary to get to a total of four samples of the same type. If any sample of a given type fails the secondround clearance test, the failed surface will be re-cleaned, and all other surfaces of the same type (i.e., sill, trough, floor) in the remaining

untested rooms will be re-cleaned.

4.3.3 Cost Estimation for Renovation Firms Performing Dust Wipe Testing and

Clearance

The costs of dust wipe sampling for a renovation firm can be split into: (1) dust sampling material costs,

(2) renovation firm labor costs, (3) shipping of samples, (4) lab costs, (5) report paperwork costs, and (6)

shipping of results.

9 The methodology used to estimate the direct costs of dust wipe testing is presented

in Table 4-29. The costs associated with dust sampling technician training are presented in sections 4.4

and 4.5.

Dust wipe testing costs are expected to vary according to the number of samples that are required, which

will vary depending upon the number of rooms where samples must be taken and whether or not carpet is

9 Most renovation firms are assumed to have a renovator become trained and certified as a Dust Sampling Technician, instead of

hiring a third party firm to take the sample (see Section 4.4). These firms can take the samples and send them to the lab

themselves. Because the staff are already at the renovation site, there are not travel costs associated with dust wipe testing

for these events.

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present. For a typical one-room renovation event, four samples would be required (window sill, window

trough, workroom floor, adjacent room floor). For a renovation event where both the renovated room and

the adjacent room are carpeted, only two samples would be required (window sill and window trough).

Each additional room inside the work area will add 2-3 dust wipes depending on whether or not the room

is carpeted (and whether or not there are windows in the work area), however samples are not required for

more than 4 rooms in a unit’s work area.

Labor time in the lead evaluation firm questionnaire was defined as “the amount of labor time, excluding

travel time, required to take four dust wipe samples, send them to the lab, and provide a one page report

to the contractor.” Although use of this question for estimating the labor cost for events that require more

or less than four samples may be limited, responses to question 1a regarding the cost of taking additional

samples can be used to estimate the additional labor necessary per sample (See column C of Table 4-29).

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Table 4-29: Summary of Dust Wipe Testing Costs (2008$)

(A) Number of Samples (B) Lab and

Material Cost

Per Sample

(C) Marginal Labor

Cost Per Sample

(D) Shipping Costs (E) Report Paperwork

Costs Per Event

(F) Fixed Labor

Costs

(G) Total

Dust-Sampling-Only Events:

Estimated as the sum of: (1) the

number of windows multiplied by

two samples, (2) the number of

rooms multiplied by the likelihood

of non-carpeted floors, and (3) one

sample outside the work area.

Estimated as the sum of:

 $4.95 for shipping samples

to the lab

 Costs of shipping results to

owners and occupants

($4.95 for each recipient)

 $0.56 for ten minutes of

labor time (at the renovator

hourly wage rate of $34.92).

Estimated as $0.36 to

make one copy of the

four-page report for the

property owner.cFor

rental properties,

estimated as $0.72 to

make two copies (for

both the owner and

occupant). It is assumed

that public or

commercial building

COFs will also make 2

copies of the report.

Estimated to be 0.83

hours: calculated as

1.75 hours (the total

from Question 3) less

the variable labor

(0.76 hours or 0.19

per sample shown in

column C) less

shipping labor (0.16

hours shown in

column D).

Clearance Events:

Estimated as the sum of: (1) the

product of the number of windows,

two window samples, and one plus

the combined first and second

failure rate, (2) the product of the

number of rooms, the likelihood of

non-carpeted floors, and one plus

the combined first and second

failure rates, and (3) one sample

outside the work area.

Estimated as

$19 per sample

for lab fees

(Question 2)

plus $0.25 afor

the dust wipe.

The cost of an

additional sample

was estimated to be

$26 for third party

testing (Question 1a).

This includes $19 for

lab fees (Question 2)

plus $0.25afor the

dust wipe, implying

that the cost of the

marginal labor per

dust wipe is $6.75.

Assuming a loaded

wage of $34.92/hour,

this implies that the

marginal labor per

sample is about 0.19

hours.

Estimated as the sum of:

 The expected number of

clearance tests multiplied

by (1) $4.95 for shipping

samples to the lab and (2)

$0.28 for 5 minutes of labor

time (at a renovator wage

rate)

 Costs of shipping results to

owners and occupants

($4.95 for each recipient or

$15.68bfor each recipient

for events affecting access

to the kitchen and

bathroom)

 $0.28 for five minutes of

labor time (at the renovator

wage rate).

Estimated as the specific

per-report costs

described for dust wipe

testing events above

multiplied by the

expected number of

clearance tests per event.

Estimated to be 0.83

hours calculated as

above multiplied by

the expected number

of clearance tests.

Estimated as the

sum of (D), (E)

and (F) plus the

number of units

from (A)

multiplied by the

sum of the costs

of (B) and (C).

aThe cost of a 200 pack of Ghost Wipes (ASTM approved wipes for lead dust testing) divided by 200.

b

$15.68 is the average of USPS, FedEx, and UPS overnight rates for a package of 1⁄2 lb in distance zone 1 or 2

c The report is assumed to be four pages on average, this accounts for a one page job description, one page of lab results, one page for a diagram of sample locations, and one additional page

is assumed to account for the instances where more than three pages might be necessary.

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4.3.4 Likelihood of Clearance Failure

In order to approximate the frequency that dust wipe testing will result in floor or window re-cleaning

activities, a clearance failure rate must be estimated separately for each component. Post-cleaning

verification lead dust levels from EPA’s Dust Study can be used to estimate what proportion of

renovation events will fail the first (or both the first and second) round of clearance. Table 4-30 describes

the methodology for estimating the failure rate using two different rates of floor sample failure for work

areas with floors in “poor” condition and work areas with floors in “fair” or “good” condition. The Dust

Study demonstrated that poor floor condition is positively correlated with post-cleaning-verification dust

lead levels and it is likely that more floors in the dust study were in poor condition compared to those in

the regulated housing stock. Therefore, this analysis estimates different clearance failure rates depending

on floor condition in order to reduce the upward bias on failure rates that would result if the analysis did

not account for floor condition in the failure rate estimates.

The Dust Study included window sill dust wipe tests, but did not include window trough dust wipe tests.

However, in many instances in the Dust Study the window sills were in such poor condition that sampling

trays were placed on the sills and the dust wipe samples were taken from the sampling trays. Since these

sampling trays are likely to be easier to clean than the average window sill that may be in fair or poor

condition, this analysis uses the floor failure rate as a proxy for the sill and trough failure rate. The

estimated average floor failure rate is 13.8 percent, which is higher than the 13.3 percent failure rate for

window sill tests observed in the Dust Study.

Table 4-30: Window Sill, Window Trough, and Floor Sample Clearance Failure Rates

Formula Failure Rate Description/Comments

Floors

Overall:

(Poor-condition floor failure

rate)*(percentage of floors not

smooth/cleanable) + (fair/good-condition

floor failure rate)*(percentage of floors

smooth/cleanable)

13.8% The average clearance failure rate of floors, weighted

by the proportion of uncarpeted floor surfaces in pre1978 housing that are described as smooth/cleanable

(98.08%) versus not smooth/cleanable (1.92%) from

NSLAH data. Sample weights were used.

Poor-Condition Floors:

(Number of post-verification floor samples

in Phase I experiments > 40 μg/ft2)/(total

number of floor samples in Phase I

experiments)

78.6% Clearance failure rate of floors for experiments in

Dust Study that used plastic containment and rule

cleaning practices, with pre-work floors in poor

condition. There were 22 samples in this group that

failed out of a total of 28 samples from 7

experiments.

Fair/Good-Condition Floors:

(Number of post-verification floor samples

in Phase I experiments > 40 μg/ft2)/(total

number of floor samples in Phase I

experiments)

12.5% Clearance failure rate of floors for experiments in

Dust Study that used plastic containment and rule

cleaning practices, with pre-work floors in either fair

or good condition. There were 4 samples in this

group that failed out of a total of 32 samples from 8

experiments.

Window Sills and Troughs

n.a. 13.8% Assumed to be the same as the floor failure rate.

The overall floor failure rate was estimated as a weighted average of the poor-condition floor and

fair/good-condition floor failure rates. HUD’s (2001) National Survey of Lead and Allergens in Housing

(NSLAH) data was used to calculate the percentage of pre-1978 housing with floors that are non

smooth/cleanable – a proxy for poor condition floors. The overall floor clearance failure rate was

estimated as the frequency of not smooth/cleanable floors (1.92%) multiplied by the poor-condition floor

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failure rate (78.6%), and the frequency of smooth/cleanable floors (98.08%) multiplied by the fair/goodcondition floor failure rate (12.5%). Thus, the weighted average clearance failure rate for floor surface

samples is 13.8%.

This analysis makes the simplifying assumption that following a single clearance failure and the

necessary re-cleaning activities, the sample will have an equal probability of failing clearance the second

time around. This assumption is made because no current studies provide information about the

likelihood of a second clearance failure for lead dust wipe tests. Therefore, the second failure rate can be

estimated as the first failure rate squared – that is, the likelihood of one failure multiplied by the

likelihood of another failure given the first failure. The combined failure rate is the sum of this value and

the original failure rate calculated in Table 4-30. These combined component failure rates are presented

below in Table 4-31.

Table 4-31: Combined First and Second Clearance Failure Rates

Sample Component Formula Combined 1st and 2nd Failure Rate

Window Sill (0.138) + (0.138)215.70%

Window Trough (0.138) + (0.138)215.70%

Floor (0.138) + (0.138)215.70%

4.3.5 Costs of Re-Cleaning After a Clearance Test Failure

This section presents the methodology used for estimating re-cleaning costs when a clearance failure has

occurred. The re-cleaning methods prescribed by the LRRP Clearance Rule are the same as the initial

cleaning methods from the 2008 LRRP Rule: thus, these costs are estimated following the 2008 analysis

methodology.

4.3.5.1 Costs of Re-Cleaning

Table 4-32 lists the potential re-cleaning activities associated with clearance and describes how to

determine costs per square foot for these activities. It is important to note that for events that only require

dust-wipe testing (use of a heat gun, removal or replacement of windows or door frames, scraping an area

of 60 sq. ft. or greater, or removal of over 40 sq. ft. of trim or molding), no re-cleaning or re-testing is

required by the rule. For clearance events (use of a high-speed paint removal machine or demolition or

destructive removal of over 6 sq. ft. of plaster), re-cleaning and re-sampling are necessary only for a

subset of events in which any surface fails the first or second round of clearance. In the event of a failed

clearance test, only the components that failed the tests must be re-cleaned. For example, if the window

sill sample failed clearance but the window troughs and the floors passed, the window sill must be recleaned but the window troughs and the floors do not need to be re-cleaned.

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Table 4-32: Material Cost and Labor Hours per Square Foot Required for Re-Cleaning

Activities (2008$)

Cost Type Material

Cost/

Sq.Ft.

Labor

Hours/

Sq.Ft.

Rule Text & Estimation Method

(1) HEPA Vacuum

and Wet

Wipe/Mopping

(Floors)

$0.022 0.005 HEPA vacuum: Thoroughly vacuum all remaining surfaces

and objects in the work area, including furniture and fixtures,

with a HEPA vacuum.

Wet Wipe/Mopping: Mop uncarpeted floors thoroughly,

using a mopping method that keeps the wash water separate

from the rinse water, such as the 2-bucket mopping method,

or using a wet mopping system.

Likelihood of uncarpeted floors times 110% of the square

footage of the work area.

(2) HEPA Vacuum

and Wet

Wipe/Mopping

(Window Sills)

$0.022 0.005 HEPA vacuum: Thoroughly vacuum all remaining surfaces

and objects in the work area, including furniture and fixtures,

with a HEPA vacuum.

Wet Wipe/Mopping: Wipe all remaining surfaces and

objects in the work area, except for carpeted or upholstered

surfaces, with a damp cloth.

The number of windows times size of windowsill

(3 HEPA Vacuum

and Wet

Wipe/Mopping

(Window Troughs)

$0.022 0.1 HEPA vacuum: Thoroughly vacuum all remaining surfaces

and objects in the work area, including furniture and fixtures,

with a HEPA vacuum.

Wet Wipe/Mopping: Wipe all remaining surfaces and

objects in the work area, except for carpeted or upholstered

surfaces, with a damp cloth.

The number of windows

Assumptions: Labor and material costs were derived from RS Means data for the activity: “Asbestos Abatement Work

Area, pre-cleaning, HEPA vacuum and wet wipe, flat surfaces”; cleaning of 110% of the total square footage accounts

for additional horizontal surfaces that may require cleaning, such as floor space outside the perimeter of the work area;

cleaning a window trough is more labor-intensive than other surfaces and thus it is assumed that this requires 6

minutes per square foot of vacuuming and cleaning.

Labor Hours Per Square Foot

The labor hours per square foot required for HEPA vacuuming and wet wiping that was estimated for the

2008 analysis was derived from RS Means data for the activity: “Asbestos Abatement Work Area, precleaning, HEPA vacuum and wet wipe, flat surfaces,” which specified 0.005 labor hours per square foot.

Since following clearance failure the firm must return to the renovation work location to perform recleaning and re-testing, travel costs must be included in the total cost of re-cleaning. According to the

2008 LRRP Rule, either a certified renovator or a worker supervised by an on-site certified renovator

must carry out cleaning activities.10 Because estimated labor time for re-cleaning is under an hour for the

majority of events, the analysis assumes that only the renovator will travel to re-clean the work area

following clearance failure. Travel cost details are provided in Table 4-33 below.

10 Re-cleaning must be performed following the cleaning procedures prescribed by the 2008 rule.

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Table 4-33: Travel Costs for Re-Cleaning (2008$)

Required

Persons

Round Trip

Mileage

Travel

Cost/Mile

Traveling

Time

Value of

Time/Hr.

Total Travel Costs for Re-Cleaning

1 renovator 30 mi. $0.545a0.75 $34.92 (30 mi * $0.545) + (0.75 hr *

$34.92) = $42.54

Assumptions: The worker or renovator responsible for re-cleaning the work area will travel approximately 15 miles

(roughly 20 minutes) each direction to the job; a loaded hourly wage of $34.92 is used (from construction supervisor

wage rates, BLS 2008); since re-cleaning jobs usually require only an hour or less of labor time, only one person

travels to perform re-cleaning.

a. This mileage cost reflects the average standard mileage rate from 2008 which is used for computing deductible

costs of operating an automobile for business purposes (IRS 2008). This average value is computed as a simple

average of the rate applicable from January 1 - June 30, 2008 and the rate applicable from July 1 – December 31,

2008.

The example presented in Table 4-34 – estimating costs for a small interior painting job with a high-speed

paint removal machine in single-family owned housing– shows the cost of re-cleaning after failing a

clearance test. The proposed rule requirements indicate that if the residual lead level in a particular dust

sample equals or exceeds the applicable clearance level, the components represented by the failed sample

shall be re-cleaned or re-tested. Since the three dust wipe samples obtained from the work area are one

each from the floor, interior window sill, and window trough, whichever sample fails will result in the recleaning of only that surface area. Therefore, for both window failed clearance and floor failed clearance,

three estimation steps are required: summary of required units, cost per unit, and total activity cost.

Table 4-34: An Example of Re-Cleaning Cost Estimation – Interior Painting with HighSpeed Machine Paint Removal (2008$)

Event Cost

Component

(A) Summary of Required

Units

(B) Cost Per

Unit

(C) Total Cost Per

Activity

Floor

HEPA Vacuum and Wet

Wipe/Mopping: 48% * 110% *

112 sq ft.] = 59.136 sq. ft.

$0.022 + (0.005)

* $34.92) =

$0.197

59.136 sq. ft. HEPA

vacuum * $0.197 = $11.63

Window Sill HEPA Vacuum and Wet

Wipe/Mopping: 1 window *

0.667 sq. ft. = 0.667 sq. ft.

$0.022 + (0.005 *

$34 92) = $0.197

0.667 sq. ft. HEPA

vacuum * $0.197 = $0.13

Small OwnerOccupied

Single Family

Interior

Painting with

High-Speed

Machine Paint

Removal: Window

Trough

HEPA Vacuum and Wet

Wipe/Mopping: 1 window *

0.667 sq. ft. = 0.667 sq. ft.

$0.022 + (0.10 *

$34 92) = $3.514

0.667 sq. ft. HEPA

vacuum * $3 514 = $2.34

Assumptions: A small interior painting event in a single family owned property has a work area of one room and 112

square feet; the likelihood of carpet is 52%; the labor cost uses a mean loaded wage rate of $34.92 based on average

construction supervisor hourly wages (BLS 2008).

Because prescribed re-cleaning activities are determined by which dust wipe in a given work area fails,

the method for estimating costs is presented in three different tables (Table 4-35, Table 4-36, and Table

4-37) for three different possible situations: a floor sample failing clearance, a window sill sample failing

clearance, and a window trough sample failing clearance. If more than one component were to fail

clearance, all material and labor costs from the tables could simply be combined, except for travel (since

the firm would not need to travel twice to re-clean two separate components).

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Table 4-38 shows several examples of the estimated cost breakdown among materials, labor, and travel,

for each possible combination of failed work area components for a small interior painting event in

single-family owner-occupied housing. Overall, for a single event type such as small interior painting,

the variance of total re-cleaning costs is small – this is because the bulk of re-cleaning costs comes from

the travel expense portion.

Table 4-35: Costs Per Re-Cleaning – Floor Sample Clearance Failure

Material Units Labor Hours

HEPA

Vacuum

Wet Wipe /

Mopping

Travel

Mileage

HEPA

Vacuum

Wet Wipe Travel

Time

Total Costs

(1-carpet

likelihood) *

110% square

footage

(1-carpet

likelihood) *

110% square

footage

30 miles 0.0025 hrs. *

(1-carpet

likelihood) *

110% square

footage

0.0025 hrs. *

(1-carpet

likelihood) *

110% square

footage

0.75 hrs. $0.011*vacuum

and wet wipe

units + $0.545

* mileage +

$34.92* total

labor hours

Note: For kitchen events, 125% square footage will be used in place of 110% square footage.

Table 4-36: Costs Per Re-Cleaning – Window Sill Sample Clearance Failure

Material Units Labor Hours

HEPA

Vacuum

Wet Wipe /

Mopping

Travel

Mileage

HEPA

Vacuum

Wet Wipe Travel

Time

Total Costs

0.667 square

feet * number

of windows

0.667 square

feet * number

of windows

30 miles 0.0025 hours

* 0.667

square feet *

number of

windows

0.0025 hours

* 0.667

square feet *

number of

windows

0.75 hrs. $0.011*vacuum

and wet wipe

units + $0.545

* mileage +

$34.92* total

labor hours

Note: For kitchen events, 125% square footage will be used in place of 110% square footage.

Table 4-37: Costs Per Re-Cleaning – Window Trough Sample Clearance Failure

Material Units Labor Hours

HEPA

Vacuum

Wet Wipe /

Mopping

Travel

Mileage

HEPA

Vacuum

Wet Wipe Travel

Time

Total Costs

0.667 square

feet * number

of windows

0.667 square

feet * number

of windows

30 miles 0.05 hours *

0.667 square

feet * number

of windows

0.05 hours *

0.667 square

feet * number

of windows

0.75 hrs. $0.011*vacuum

and wet wipe

units + $0.545

* mileage +

$34.92* total

labor hours

Note: For kitchen events, 125% square footage will be used in place of 110% square footage.

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Economic Analysis for the LRRP Clearance Proposed Rule

Chapter 4 4-47

Table 4-38: Costs Per Re-Cleaning Example – Owner-Occupied Single-Family Small Interior

Painting Event

Failed Component Materials Cost Labor Cost Travel Cost Total

Floor $1 30 $10.33 $42.54 $54.17

Sill $0.01 $0.12 $42.54 $42.67

Trough $0.01 $2.33 $42.54 $44.88

Floor, Sill $1 32 $10.44 $42.54 $54.30

Floor, Trough $1 32 $12.65 $42.54 $56.51

Sill, Trough $0.03 $2.45 $42.54 $45.02

Floor, Sill, Trough $1 33 $12.77 $42.54 $56.64

In order to estimate average per-event re-cleaning costs, the likelihood of clearance failure for each

sample type must be accounted for (see Section 4.3.4). The analysis makes the simplifying assumption

that sample failures are not correlated (e.g., a floor sample failure would not make a window trough

sample failure any more likely). In order to calculate the average re-cleaning costs for a clearance failure

event, the likelihoods of each component failure are multiplied by their respective component cleaning

costs, and these values are summed. Travel, which is not a component-specific re-cleaning cost, is

estimated as the flat travel cost above multiplied by the likelihood of any clearance failures. The cost

example of a small interior painting event presented in Table 4-38 above is extended below in Table 4-39

to show the average expected re-cleaning costs. While Table 4-38 shows the costs per re-cleaning for the

different scenarios where it would be required, Table 4-39 presents the average expected re-cleaning

costs, over all jobs, accounting for the instances where no re-cleaning is required because clearance is

achieved after the initial cleaning. Averaging the re-cleaning costs across all jobs (i.e., those that require

re-cleaning and those that do not) simplifies the calculations by allowing the calculation of a total cost per

event that applies to all jobs.

Table 4-39: Example of Average Expected Re-Cleaning Costs: Owner-Occupied Single-Family

Small Interior Painting Event

Floor Re-Cleaning Sill Re-Cleaning Trough ReCleaning Travel

Material Labor Material Labor Material Labor Mileage

Value of

Time

Total

Average Costs for all Clearance Events

$0 20 $1.62 $0.002 $0.02 $0.002 $0.37 $5.77 $9.24 $17.22

Methodology

Floor failure

rate * 110%

uncarpeted

square

footage *

$0.022

Floor failure

rate * 110%

uncarpeted

square

footage *

0.005 *

renovator

wage rate

Sill failure

rate * total

window

surface area

* $0.022

Sill failure

rate * total

window

surface area

* 0.005 *

renovator

wage rate

Trough

failure rate *

total window

surface area

* $0.022

Trough

failure rate *

total window

surface area

* 0.1 *

renovator

wage rate

Expected

number of recleanings* 20

miles *

$0 545

Expected

number of recleanings* 0 5

hours*

renovator

wage rate

Re-cleaning

material costs

+ re-cleaning

labor costs +

travel costs

In order to calculate a total cost per event that applies to all jobs, the average re-cleaning costs are calculated across all jobs

(i.e., those that require re-cleaning and those that do not).

4.3.6 Summary of Dust Wipe Testing and Clearance Costs Per-Event

Each type of event will incur a different set of costs based on the number of dust wipe samples required,

whether clearance is required, whether it is in target housing or a public or commercial building COF, and

Deleted: EO 12866 Review Draft:

Deleted: January 20, 2010 Draft –

Deliberative, Predecisional – Do

not Quote, Cite, or Distribute

Deleted:
Economic Analysis for the LRRP Clearance Proposed Rule

Chapter 4 4-48

other event characteristics. Table 4-40 through Table 4-49 below summarize the cost components for all

event possibilities considered in this analysis.

Table 4-40: Dust Wipe Testing Per-Event Costs Summary: Single-Family Owner-Occupied Target Housing

Size of Work Area for the

Event1

Number of

Dust Wipe

Samples2, 3 Lab Costs3

Dust Wipe

Testing

Labor

Costs3

DustWipe

Testing

Material

Costs3

Total

Shipping3

Report

Paperwork3

Total PerEvent Cost3

Events Excluding Kitchens or Bathrooms

Bathroom Size (48 ft2) 2.96 $56.24 $48.39 $0.74 $15.72 $0.36 $121.45

Kitchen Size (160 ft2) 2.96 $56.24 $48.39 $0.74 $15.72 $0.36 $121.45

Bath + Kitchen Size (208 ft2) 5.44 $103.36 $64.84 $1.36 $15.72 $0.36 $185.64

Small Painting Size (112 ft2) 2.96 $56.24 $48.39 $0.74 $15.72 $0.36 $121.45

Medium Painting Size (308 ft2) 3.63 $68.96 $52.83 $0.91 $15.72 $0.36 $138.78

Large Painting Size (504 ft2) 5.64 $107.13 $66.16 $1.41 $15.72 $0.36 $190.78

Small Window Door Size (63 ft2) 2.96 $56.24 $48.39 $0.74 $15.72 $0.36 $121.45

Large Window Door Size (640 ft2) 7.03 $133.52 $75.37 $1.76 $15.72 $0.36 $226.73

Events Including Kitchens or Bathrooms

Bathroom Size (48 ft2) 3.78 $71.82 $53.83 $0.95 $15.72 $0.36 $142.68

Kitchen Size (160 ft2) 3.78 $71.82 $53.83 $0.95 $15.72 $0.36 $142.68

Bath + Kitchen Size (208 ft2) 6.67 $126.73 $73.00 $1.67 $15.72 $0.36 $217.48

Small Painting Size (112 ft2) 3.78 $71.82 $53.83 $0.95 $15.72 $0.36 $142.68

Medium Painting Size (308 ft

2

) 4.27 $81.04 $57.05 $1.07 $15.72 $0.36 $155.23

Large Painting Size (504 ft2) 6.16 $117.08 $69.63 $1.54 $15.72 $0.36 $204.33

Small Window Door Size (63 ft2) 3.78 $71.82 $53.83 $0.95 $15.72 $0.36 $142.68

Large Window Door Size (640 ft2) 7.50 $142.51 $78.51 $1.88 $15.72 $0.36 $238.98

1 Event sizes were estimated for EPA’s 2008 LRRP Rule Analysis and represent the work area size and not necessarily the amount of lead-based paint

disturbed. A “bathroom size” or “kitchen size” indicates the event size, not the event type. In addition to bathroom and kitchen events, other event

types having these size definitions are:

bathroom size: wall-disturbing events, addition events

kitchen size: wall-disturbing events, addition events, window/door replacements

bathroom + kitchen size: wall-disturbing events, addition events

2 The average number of required samples is presented. One sample is required outside the work area and three samples are required per room in the

work area: (1) floor sample, (2) window sill sample, and (3) window trough sample. However, floor samples are not required on carpeted floors (so the

minimum number of required samples may be as low as two if the work area is one room and all floors are carpeted). The estimated numbers of rooms

affected and the probability that floors are carpeted were estimated following the methodology developed for the 2008 LRRP rule analysis.

3

See section 4.3.3 and Table 4-29 for a description of how these costs are calculated.

Events excluding kitchens or bathrooms are calculated separately from events including kitchens and bathrooms, because kitchens and bathrooms have a

different probability of being carpeted than the rest of the house, and dust wipe samples are only taken on uncarpeted floors.

Deleted: EO 12866 Review Draft:

Deleted: January 20, 2010 Draft –

Deliberative, Predecisional – Do

not Quote, Cite, or Distribute

Deleted:
Economic Analysis for the LRRP Clearance Proposed Rule

Chapter 4 4-49

Table 4-41: Dust Wipe Testing Per-Event Costs Summary: Single-Family Renter-Occupied Target Housing

Size of Work Area for the

Event1

Number of

Dust Wipe

Samples2, 3 Lab Costs3

Dust Wipe

Testing

Labor

Costs3

DustWipe

Testing

Material

Costs3

Total

Shipping3

Report

Paperwork3

Total PerEvent Cost3

Events Excluding Kitchens or Bathrooms

Bathroom Size (48 ft2) 2.96 $56.24 $48.39 $0.74 $20.67 $0.72 $126.76

Kitchen Size (120 ft2) 2.96 $56.24 $48.39 $0.74 $20.67 $0.72 $126.76

Bath + Kitchen Size (168 ft2) 5.44 $103.36 $64.84 $1.36 $20.67 $0.72 $190.95

Small Painting Size (96 ft2) 2.96 $56.24 $48.39 $0.74 $20.67 $0.72 $126.76

Medium Painting Size (232 ft2) 3.11 $59.07 $49.38 $0.78 $20.67 $0.72 $130.61

Large Painting Size (368 ft2) 4.65 $88.28 $59.58 $1.16 $20.67 $0.72 $170.41

Small Window Door Size (55 ft2) 2.96 $56.24 $48.39 $0.74 $20.67 $0.72 $126.76

Large Window Door Size (480 ft2) 5.94 $112.78 $68.13 $1.48 $20.67 $0.72 $203.79

Events Including Kitchens or Bathrooms

Bathroom Size (48 ft2) 3.78 $71.82 $53.83 $0.95 $20.67 $0.72 $147.99

Kitchen Size (120 ft2) 3.78 $71.82 $53.83 $0.95 $20.67 $0.72 $147.99

Bath + Kitchen Size (168 ft2) 6.67 $126.73 $73.00 $1.67 $20.67 $0.72 $222.79

Small Painting Size (96 ft2) 3.78 $71.82 $53.83 $0.95 $20.67 $0.72 $147.99

Medium Painting Size (232 ft2) 3.73 $70.81 $53.48 $0.93 $20.67 $0.72 $146.61

Large Painting Size (368 ft2) 5.16 $97.96 $62.96 $1.29 $20.67 $0.72 $183.59

Small Window Door Size (55 ft2) 3.78 $71.82 $53.83 $0.95 $20.67 $0.72 $147.99

Large Window Door Size (480 ft2) 6.38 $121.30 $71.11 $1.60 $20.67 $0.72 $215.39

1 Event sizes were estimated for EPA’s 2008 LRRP Rule Analysis and represent the work area size and not necessarily the amount of lead-based paint

disturbed. A “bathroom size” or “kitchen size” indicates the event size, not the event type. In addition to bathroom and kitchen events, other event

types having these size definitions are:

bathroom size: wall-disturbing events, addition events

kitchen size: wall-disturbing events, addition events, window/door replacements

bathroom + kitchen size: wall-disturbing events, addition events

2 The average number of required samples is presented. One sample is required outside the work area and three samples are required per room in the

work area: (1) floor sample, (2) window sill sample, and (3) window trough sample. However, floor samples are not required on carpeted floors (so the

minimum number of required samples may be as low as two if the work area is one room and all floors are carpeted). The estimated numbers of rooms

affected and the probability that floors are carpeted were estimated following the methodology developed for the 2008 LRRP rule analysis.

3

See section 4.3.3 and Table 4-29 for a description of how these costs are calculated.

Events excluding kitchens or bathrooms are calculated separately from events including kitchens and bathrooms, because kitchens and bathrooms have a

different probability of being carpeted than the rest of the house, and dust wipe samples are only taken on uncarpeted floors.

Deleted: EO 12866 Review Draft:

Deleted: January 20, 2010 Draft –

Deliberative, Predecisional – Do

not Quote, Cite, or Distribute

Deleted:
Economic Analysis for the LRRP Clearance Proposed Rule

Chapter 4 4-50

Table 4-42: Dust Wipe Testing Per-Event Costs Summary: Multi-Family Owner-Occupied Target Housing

Size of Work Area for the

Event1

Number of

Dust Wipe

Samples2, 3 Lab Costs3

Dust Wipe

Testing

Labor

Costs3

DustWipe

Testing

Material

Costs3

Total

Shipping3

Report

Paperwork3

Total PerEvent Cost3

Events Excluding Kitchens or Bathrooms

Bathroom Size (48 ft2) 2.96 $56.24 $48.39 $0.74 $15.72 $0.36 $121.45

Kitchen Size (80 ft2) 2.96 $56.24 $48.39 $0.74 $15.72 $0.36 $121.45

Bath + Kitchen Size (128 ft2) 5.44 $103.36 $64.84 $1.36 $15.72 $0.36 $185.64

Small Painting Size (84 ft2) 2.96 $56.24 $48.39 $0.74 $15.72 $0.36 $121.45

Medium Painting Size (184 ft2) 2.96 $56.24 $48.39 $0.74 $15.72 $0.36 $121.45

Large Painting Size (284 ft2) 3.95 $75.09 $54.97 $0.99 $15.72 $0.36 $147.13

Small Window Door Size (45 ft2) 2.96 $56.24 $48.39 $0.74 $15.72 $0.36 $121.45

Large Window Door Size (320 ft2) 4.40 $83.57 $57.93 $1.10 $15.72 $0.36 $158.68

Events Including Kitchens or Bathrooms

Bathroom Size (48 ft2) 3.78 $71.82 $53.83 $0.95 $15.72 $0.36 $142.68

Kitchen Size (80 ft2) 3.78 $71.82 $53.83 $0.95 $15.72 $0.36 $142.68

Bath + Kitchen Size (128 ft2) 6.67 $126.73 $73.00 $1.67 $15.72 $0.36 $217.48

Small Painting Size (84 ft2) 3.78 $71.82 $53.83 $0.95 $15.72 $0.36 $142.68

Medium Painting Size (184 ft2) 3.54 $67.26 $52.24 $0.89 $15.72 $0.36 $136.46

Large Painting Size (284 ft2) 4.38 $83.30 $57.84 $1.10 $15.72 $0.36 $158.31

Small Window Door Size (45 ft2) 4.81 $91.41 $60.67 $1.20 $15.72 $0.36 $169.37

1 Event sizes were estimated for EPA’s 2008 LRRP Rule Analysis and represent the work area size and not necessarily the amount of lead-based paint

disturbed. A “bathroom size” or “kitchen size” indicates the event size, not the event type. In addition to bathroom and kitchen events, other event

types having these size definitions are:

bathroom size: wall-disturbing events, addition events

kitchen size: wall-disturbing events, addition events, window/door replacements

bathroom + kitchen size: wall-disturbing events, addition events

2 The average number of required samples is presented. One sample is required outside the work area and three samples are required per room in the

work area: (1) floor sample, (2) window sill sample, and (3) window trough sample. However, floor samples are not required on carpeted floors (so the

minimum number of required samples may be as low as two if the work area is one room and all floors are carpeted). The estimated numbers of rooms

affected and the probability that floors are carpeted were estimated following the methodology developed for the 2008 LRRP rule analysis.

3

See section 4.3.3 and Table 4-29 for a description of how these costs are calculated.

Events excluding kitchens or bathrooms are calculated separately from events including kitchens and bathrooms, because kitchens and bathrooms have a

different probability of being carpeted than the rest of the house, and dust wipe samples are only taken on uncarpeted floors.

Deleted: EO 12866 Review Draft:

Deleted: January 20, 2010 Draft –

Deliberative, Predecisional – Do

not Quote, Cite, or Distribute

Deleted:
Economic Analysis for the LRRP Clearance Proposed Rule

Chapter 4 4-51

Table 4-43: Dust Wipe Testing Per-Event Costs Summary: Multi-Family Renter-Occupied Target Housing

Size of Work Area for the

Event1

Number of

Dust Wipe

Samples2, 3 Lab Costs3

Dust Wipe

Testing

Labor

Costs3

DustWipe

Testing

Material

Costs3

Total

Shipping3

Report

Paperwork3

Total PerEvent Cost3

Events Excluding Kitchens or Bathrooms

Bathroom Size (48 ft2) 2.96 $56.24 $48.39 $0.74 $20.67 $0.72 $126.76

Kitchen Size (80 ft2) 2.96 $56.24 $48.39 $0.74 $20.67 $0.72 $126.76

Bath + Kitchen Size (128 ft2) 5.44 $103.36 $64.84 $1.36 $20.67 $0.72 $190.95

Small Painting Size (84 ft2) 2.96 $56.24 $48.39 $0.74 $20.67 $0.72 $126.76

Medium Painting Size (184 ft2) 2.96 $56.24 $48.39 $0.74 $20.67 $0.72 $126.76

Large Painting Size (284 ft2) 3.95 $75.09 $54.97 $0.99 $20.67 $0.72 $152.44

Small Window Door Size (45 ft2) 2.96 $56.24 $48.39 $0.74 $20.67 $0.72 $126.76

Large Window Door Size (320 ft2) 4.40 $83.57 $57.93 $1.10 $20.67 $0.72 $163.99

Events Including Kitchens or Bathrooms

Bathroom Size (48 ft2) 3.78 $71.82 $53.83 $0.95 $20.67 $0.72 $147.99

Kitchen Size (80 ft2) 3.78 $71.82 $53.83 $0.95 $20.67 $0.72 $147.99

Bath + Kitchen Size (128 ft2) 6.67 $126.73 $73.00 $1.67 $20.67 $0.72 $222.79

Small Painting Size (84 ft2) 3.78 $71.82 $53.83 $0.95 $20.67 $0.72 $147.99

Medium Painting Size (184 ft2) 3.54 $67.26 $52.24 $0.89 $20.67 $0.72 $141.77

Large Painting Size (284 ft2) 4.38 $83.30 $57.84 $1.10 $20.67 $0.72 $163.62

Small Window Door Size (45 ft2) 4.81 $91.41 $60.67 $1.20 $20.67 $0.72 $174.68

1 Event sizes were estimated for EPA’s 2008 LRRP Rule Analysis and represent the work area size and not necessarily the amount of lead-based paint

disturbed. A “bathroom size” or “kitchen size” indicates the event size, not the event type. In addition to bathroom and kitchen events, other event

types having these size definitions are:

bathroom size: wall-disturbing events, addition events

kitchen size: wall-disturbing events, addition events, window/door replacements

bathroom + kitchen size: wall-disturbing events, addition events

2 The average number of required samples is presented. One sample is required outside the work area and three samples are required per room in the

work area: (1) floor sample, (2) window sill sample, and (3) window trough sample. However, floor samples are not required on carpeted floors (so the

minimum number of required samples may be as low as two if the work area is one room and all floors are carpeted). The estimated numbers of rooms

affected and the probability that floors are carpeted were estimated following the methodology developed for the 2008 LRRP rule analysis.

3

See section 4.3.3 and Table 4-29 for a description of how these costs are calculated.

Events excluding kitchens or bathrooms are calculated separately from events including kitchens and bathrooms, because kitchens and bathrooms have a

different probability of being carpeted than the rest of the house, and dust wipe samples are only taken on uncarpeted floors.

Deleted: EO 12866 Review Draft:

Deleted: January 20, 2010 Draft –

Deliberative, Predecisional – Do

not Quote, Cite, or Distribute

Deleted:
Economic Analysis for the LRRP Clearance Proposed Rule

Chapter 4 4-52

Table 4-44: Dust Wipe Testing Per-Event Costs Summary: Public and Commercial Building COFs

Size of Work Area for the

Event1

Number of

Dust Wipe

Samples

2, 3 Lab Costs3

Dust Wipe

Testing

Labor

Costs3

DustWipe

Testing

Material

Costs3

Total

Shipping3

Report

Paperwork3

Total PerEvent Cost3

Kindergarten (Public; 13,560 ft2) 11.30 $214.70 $103.72 $2.83 $20.67 $0.72 $342.64

Kindergarten (Large Private;

13,560 ft2) 11.30 $214.70 $103.72 $2.83 $20.67 $0.72 $342.64

Kindergarten (Small Private;

13,560 ft2) 11.30 $214.70 $103.72 $2.83 $20.67 $0.72 $342.64

Pre-K + Kindergarten (Public;

15,674 ft2) 11.30 $214.70 $103.72 $2.83 $20.67 $0.72 $342.64

Pre-K + Kindergarten (Large

Private; 15,674 ft2) 11.30 $214.70 $103.72 $2.83 $20.67 $0.72 $342.64

Pre-K + Kindergarten (Small

Private; 15,674 ft2) 11.30 $214.70 $103.72 $2.83 $20.67 $0.72 $342.64

Daycare Center (Renter-Occupied;

2,400 ft2) 9.41 $178.82 $91.19 $2.35 $20.67 $0.72 $293.75

Daycare Center (Owner-Occupied;

2400 ft2) 9.41 $178.82 $91.19 $2.35 $20.67 $0.72 $293.75

Daycare Center (Non-Profit who

performs some of own RRP; 2,400

ft2) 9.41 $178.82 $91.19 $2.35 $20.67 $0.72 $293.75

Daycare Center (Non-Profit who

uses contractors; 2,400 ft2) 9.41 $178.82 $91.19 $2.35 $20.67 $0.72 $293.75

Daycare Center (In Public School;

2,400 ft2) 9.41 $178.82 $91.19 $2.35 $20.67 $0.72 $293.75

Daycare Center (In Large Private

School; 2,400 ft2) 9.41 $178.82 $91.19 $2.35 $20.67 $0.72 $293.75

Daycare Center (In Small Private

School; 2,400 ft2) 9.41 $178.82 $91.19 $2.35 $20.67 $0.72 $293.75

1 Event sizes were estimated for EPA’s 2008 LRRP Rule Analysis and represent the work area size and not necessarily the amount of lead-based paint

disturbed.

2 One sample is required outside the work area and three samples are required per room in the work area: (1) floor sample, (2) window sill sample, and

(3) window trough sample. However, floor samples are not required on carpeted floors (so the minimum number of required samples may be as low as

two if the work area is one room and all floors are carpeted). The estimated numbers of rooms affected were estimated following the methodology

developed for the 2008 LRRP rule analysis

3

See section 4.3.3 and Table 4-29 for a description of how these costs are calculated.

Deleted: EO 12866 Review Draft:

Deleted: January 20, 2010 Draft –

Deliberative, Predecisional – Do

not Quote, Cite, or Distribute

Deleted:
Economic Analysis for the LRRP Clearance Proposed Rule

Chapter 4 4-53

Table 4-45: Average Clearance Costs Per-Event (Averaged Across Events that Pass and Fail Clearance): Single-Family Owner-Occupied Target Housing

Size of Work Area for the

Event1

Average

Number of

Dust Wipe

Samples2

Average

Lab

Costs3,5

Average

Dust Wipe

Testing

Labor

Costs3,5

Average

Dust Wipe

Testing

Material

Costs3,5

Average

Total

Shipping3,5

Average

Report

Paperwork

3,5

Average

ReCleaning

Material4,5

Average

ReCleaning

Labor4,5

Average

ReCleaning

Travel4,5

Average

Total Costs

Per-Event5

Events Excluding Kitchens or Bathrooms

Bathroom Size (48 ft2) 3.35 $63.64 $61.11 $0.84 $18.49 $0.49 $0.09 $1.08 $15.00 $160.75

Kitchen Size (160 ft2) 3.35 $63.64 $61.11 $0.84 $18.49 $0.49 $0.30 $3.08 $15.00 $162.96

Bath + Kitchen Size (208 ft2) 6.22 $118.16 $87.46 $1.55 $20.49 $0.58 $0.39 $4.16 $25.81 $258.61

Small Painting Size (112 ft2) 3.35 $63.64 $61.11 $0.84 $18.49 $0.49 $0.21 $2.01 $15.00 $161.79

Medium Painting Size (308 ft2) 4.12 $78.36 $68.29 $1.03 $19.05 $0.51 $0.57 $5.22 $18.02 $191.05

Large Painting Size (504 ft2) 6.45 $122.52 $89.43 $1.61 $20.61 $0.58 $0.94 $8.81 $26.47 $270.97

Events Including Kitchens or Bathrooms

Bathroom Size (48 ft2) 4.23 $80.44 $68.41 $1.06 $29.61 $0.50 $0.17 $1.67 $17.11 $198.98

Kitchen Size (160 ft2) 4.23 $80.44 $68.41 $1.06 $29.61 $0.50 $0.55 $5.06 $17.11 $202.75

Bath + Kitchen Size (208 ft2) 7.58 $143.98 $98.56 $1.89 $31.79 $0.60 $0.72 $6.74 $28.90 $313.17

Small Painting Size (112 ft2) 4.23 $80.44 $68.41 $1.06 $29.61 $0.50 $0.38 $3.39 $17.11 $200.91

Medium Painting Size (308 ft2) 4.82 $91.50 $74.01 $1.20 $30.09 $0.53 $0.90 $7.82 $19.69 $225.73

Large Painting Size (504 ft2) 7.03 $133.52 $94.15 $1.76 $31.58 $0.59 $1.26 $11.39 $27.77 $302.03

1 A “bathroom size” or “kitchen size” indicates the event size, not the event type. In addition to bathroom and kitchen events, other event types having these size definitions are:

bathroom size: wall-disturbing events, addition events

kitchen size: wall-disturbing events, addition events, window/door replacements

bathroom + kitchen size: wall-disturbing events, addition events

2 One sample is required outside the work area and three samples are required per room in the work area: (1) floor sample, (2) window sill sample, and (3) window trough sample. However, floor

samples are not required on carpeted floors (so the minimum number of required samples may be as low as two if the work area is one room and all floors are carpeted). The estimated numbers of rooms

affected and the probability that floors are carpeted were estimated following the methodology developed for the 2008 LRRP rule analysis

3

See section 4.3.3 and Table 4-29 for a description of how these costs are calculated.

4

See section 4.3.5 for a description of how these costs are calculated.

5 These costs vary by the size and type of the event because of varying clearance failure rates; estimated clearance failure rates are more likely for events where more samples are required. In addition,

shipping costs are higher for clearance events where a kitchen or bathroom is inside the work area because renovators are assumed to use overnight shipping in order to allow occupants to access the

work area sooner.

Note: In order to calculate a total cost per event that applies to all jobs, the average re-cleaning costs are calculated across all jobs (i.e., those that require re-cleaning and those that do not).

Events excluding kitchens or bathrooms are calculated separately from events including kitchens and bathrooms, because kitchens and bathrooms have a different probability of being carpeted than the

rest of the house, and dust wipe samples are only taken on uncarpeted floors.

Deleted: EO 12866 Review Draft:

Deleted: January 20, 2010 Draft –

Deliberative, Predecisional – Do

not Quote, Cite, or Distribute

Deleted:
Economic Analysis for the LRRP Clearance Proposed Rule

Chapter 4 4-54

Table 4-46: Average Clearance Costs Per Event (Averaged Across Events that Pass and Fail Clearance): Single-Family Renter-Occupied Target Housing

Size of Work Area for the

Event1

Average

Number of

Dust Wipe

Samples2

Average

Lab

Costs3,5

Average

Dust Wipe

Testing

Labor

Costs3,5

Average

Dust Wipe

Testing

Material

Costs3,5

Average

Total

Shipping3,5

Average

Report

Paperwork

3,5

Average

ReCleaning

Material4,5

Average

ReCleaning

Labor4,5

Average

ReCleaning

Travel4,5

Average

Total Costs

Per-Event5

Events Excluding Kitchens or Bathrooms

Bathroom Size (48 ft2) 3.35 $63.64 $61.11 $0.84 $23.44 $0.97 $0.09 $1.08 $15.00 $166.18

Kitchen Size (80 ft2) 3.35 $63.64 $61.11 $0.84 $23.44 $0.97 $0.23 $2.51 $15.00 $167.74

Bath + Kitchen Size (128 ft2) 6.22 $118.16 $87.46 $1.55 $25.44 $1.16 $0.32 $3.58 $25.81 $263.49

Small Painting Size (84 ft2) 3.35 $63.64 $61.11 $0.84 $23.44 $0.97 $0.18 $1.77 $15.00 $166.96

Medium Painting Size (184 ft2) 3.52 $66.91 $62.71 $0.88 $23.57 $0.99 $0.43 $3.96 $15.68 $175.12

Large Painting Size (284 ft2) 5.30 $100.71 $79.10 $1.33 $24.82 $1.10 $0.69 $6.52 $22.46 $236.72

Events Including Kitchens or Bathrooms

Bathroom Size (48 ft2) 4.23 $80.44 $68.41 $1.06 $45.29 $1.01 $0.17 $1.67 $17.11 $215.16

Kitchen Size (80 ft2) 4.23 $80.44 $68.41 $1.06 $45.29 $1.01 $0.42 $3.99 $17.11 $217.73

Bath + Kitchen Size (128 ft2) 7.58 $143.98 $98.56 $1.89 $47.47 $1.21 $0.58 $5.66 $28.90 $328.25

Small Painting Size (84 ft2) 4.23 $80.44 $68.41 $1.06 $45.29 $1.01 $0.33 $2.96 $17.11 $216.61

Medium Painting Size (184 ft2) 4.19 $79.60 $68.23 $1.05 $45.32 $1.01 $0.69 $6.06 $17.28 $219.25

Large Painting Size (284 ft2) 5.86 $111.34 $83.70 $1.47 $46.52 $1.12 $0.95 $8.63 $23.78 $277.52

1 A “bathroom size” or “kitchen size” indicates the event size, not the event type. In addition to bathroom and kitchen events, other event types having these size definitions are:

bathroom size: wall-disturbing events, addition events

kitchen size: wall-disturbing events, addition events, window/door replacements

bathroom + kitchen size: wall-disturbing events, addition events

2 One sample is required outside the work area and three samples are required per room in the work area: (1) floor sample, (2) window sill sample, and (3) window trough sample. However, floor

samples are not required on carpeted floors (so the minimum number of required samples may be as low as two if the work area is one room and all floors are carpeted). The estimated numbers of rooms

affected and the probability that floors are carpeted were estimated following the methodology developed for the 2008 LRRP rule analysis.

3

See section 4.3.3 and Table 4-29 for a description of how these costs are calculated.

4

See section 4.3.5 for a description of how these costs are calculated.

5 These costs vary by the size and type of the event because of varying clearance failure rates; estimated clearance failure rates are more likely for events where more samples are required. In addition,

shipping costs are higher for clearance events where a kitchen or bathroom is inside the work area because renovators are assumed to use overnight shipping in order to allow occupants to access the

work area sooner.

Note: In order to calculate a total cost per event that applies to all jobs, the average re-cleaning costs are calculated across all jobs (i.e., those that require re-cleaning and those that do not).

Events excluding kitchens or bathrooms are calculated separately from events including kitchens and bathrooms, because kitchens and bathrooms have a different probability of being carpeted than the

rest of the house, and dust wipe samples are only taken on uncarpeted floors.

Deleted: EO 12866 Review Draft:

Deleted: January 20, 2010 Draft –

Deliberative, Predecisional – Do

not Quote, Cite, or Distribute

Deleted:
Economic Analysis for the LRRP Clearance Proposed Rule

Chapter 4 4-55

Table 4-47: Average Clearance Costs Per Event (Averaged Across Events that Pass and Fail Clearance): Multi-Family Owner-Occupied Target Housing

Size of Work Area for the

Event1

Average

Number of

Dust Wipe

Samples2

Average

Lab

Costs3,5

Average

Dust Wipe

Testing

Labor

Costs3,5

Average

Dust Wipe

Testing

Material

Costs3,5

Average

Total

Shipping3,5

Average

Report

Paperwork

3,5

Average

ReCleaning

Material4,5

Average

ReCleaning

Labor4,5

Average

ReCleaning

Travel4,5

Average

Total Costs

Per-Event5

Events Excluding Kitchens or Bathrooms

Bathroom Size (48 ft2) 3.35 $63.64 $61.11 $0.84 $18.49 $0.49 $0.09 $1.08 $15.00 $160.75

Kitchen Size (80 ft2) 3.35 $63.64 $61.11 $0.84 $18.49 $0.49 $0.15 $1.54 $15.00 $161.27

Bath + Kitchen Size (128 ft2) 6.22 $118.16 $87.46 $1.55 $20.49 $0.58 $0.24 $2.62 $25.81 $256.92

Small Painting Size (84 ft2) 3.35 $63.64 $61.11 $0.84 $18.49 $0.49 $0.16 $1.60 $15.00 $161.33

Medium Painting Size (184 ft2) 3.35 $63.64 $61.11 $0.84 $18.49 $0.49 $0.34 $3.05 $15.00 $162.96

Large Painting Size (284 ft2) 4.50 $85.45 $71.73 $1.12 $19.31 $0.52 $0.53 $4.80 $19.44 $202.90

Events Including Kitchens or Bathrooms

Bathroom Size (48 ft2) 4.23 $80.44 $68.41 $1.06 $29.61 $0.50 $0.17 $1.67 $17.11 $198.98

Kitchen Size (80 ft2) 4.23 $80.44 $68.41 $1.06 $29.61 $0.50 $0.28 $2.53 $17.11 $199.94

Bath + Kitchen Size (128 ft2) 7.58 $143.98 $98.56 $1.89 $31.79 $0.60 $0.44 $4.20 $28.90 $310.36

Small Painting Size (84 ft2) 4.23 $80.44 $68.41 $1.06 $29.61 $0.50 $0.29 $2.64 $17.11 $200.06

Medium Painting Size (184 ft2) 3.98 $75.53 $66.27 $0.99 $29.50 $0.50 $0.54 $4.66 $16.49 $194.48

Large Painting Size (284 ft2) 4.97 $94.41 $75.63 $1.24 $30.25 $0.53 $0.72 $6.34 $20.58 $229.70

1 A “bathroom size” or “kitchen size” indicates the event size, not the event type. In addition to bathroom and kitchen events, other event types having these size definitions are:

bathroom size: wall-disturbing events, addition events

kitchen size: wall-disturbing events, addition events, window/door replacements

bathroom + kitchen size: wall-disturbing events, addition events

2 One sample is required outside the work area and three samples are required per room in the work area: (1) floor sample, (2) window sill sample, and (3) window trough sample. However, floor

samples are not required on carpeted floors (so the minimum number of required samples may be as low as two if the work area is one room and all floors are carpeted). The estimated numbers of rooms

affected and the probability that floors are carpeted were estimated following the methodology developed for the 2008 LRRP rule analysis

3

See section 4.3.3 and Table 4-29 for a description of how these costs are calculated.

4

See section 4.3.5 for a description of how these costs are calculated.

5 These costs vary by the size and type of the event because of varying clearance failure rates; estimated clearance failure rates are more likely for events where more samples are required. In addition,

shipping costs are higher for clearance events where a kitchen or bathroom is inside the work area because renovators are assumed to use overnight shipping in order to allow occupants to access the

work area sooner.

Note: In order to calculate a total cost per event that applies to all jobs, the average re-cleaning costs are calculated across all jobs (i.e., those that require re-cleaning and those that do not).

Events excluding kitchens or bathrooms are calculated separately from events including kitchens and bathrooms, because kitchens and bathrooms have a different probability of being carpeted than the

rest of the house, and dust wipe samples are only taken on uncarpeted floors.

Deleted: EO 12866 Review Draft:

Deleted: January 20, 2010 Draft –

Deliberative, Predecisional – Do

not Quote, Cite, or Distribute

Deleted:
Economic Analysis for the LRRP Clearance Proposed Rule

Chapter 4 4-56

Table 4-48: Average Clearance Costs Per Event (Averaged Across Events that Pass and Fail Clearance): Multi-Family Renter-Occupied Target Housing

Size of Work Area for the

Event1

Average

Number of

Dust Wipe

Samples2

Average

Lab

Costs3,5

Average

Dust Wipe

Testing

Labor

Costs3,5

Average

Dust Wipe

Testing

Material

Costs3,5

Average

Total

Shipping3,5

Average

Report

Paperwork

3,5

Average

ReCleaning

Material4,5

Average

ReCleaning

Labor4,5

Average

ReCleaning

Travel4,5

Average

Total Costs

Per-Event5

Events Excluding Kitchens or Bathrooms

Bathroom Size (48 ft2) 3.35 $63.64 $61.11 $0.84 $23.44 $0.97 $0.09 $1.08 $15.00 $166.18

Kitchen Size (80 ft2) 3.35 $63.64 $61.11 $0.84 $23.44 $0.97 $0.15 $1.54 $15.00 $166.70

Bath + Kitchen Size (128 ft2) 6.22 $118.16 $87.46 $1.55 $25.44 $1.16 $0.24 $2.62 $25.81 $262.44

Small Painting Size (84 ft2) 3.35 $63.64 $61.11 $0.84 $23.44 $0.97 $0.16 $1.60 $15.00 $166.77

Medium Painting Size (184 ft2) 3.35 $63.64 $61.11 $0.84 $23.44 $0.97 $0.34 $3.05 $15.00 $168.40

Large Painting Size (284 ft2) 4.50 $85.45 $71.73 $1.12 $24.26 $1.05 $0.53 $4.80 $19.44 $208.38

Events Including Kitchens or Bathrooms

Bathroom Size (48 ft2) 4.23 $80.44 $68.41 $1.06 $45.29 $1.01 $0.17 $1.67 $17.11 $215.16

Kitchen Size (80 ft2) 4.23 $80.44 $68.41 $1.06 $45.29 $1.01 $0.28 $2.53 $17.11 $216.13

Bath + Kitchen Size (128 ft2) 7.58 $143.98 $98.56 $1.89 $47.47 $1.21 $0.44 $4.20 $28.90 $326.65

Small Painting Size (84 ft2) 4.23 $80.44 $68.41 $1.06 $45.29 $1.01 $0.29 $2.64 $17.11 $216.25

Medium Painting Size (184 ft2) 3.98 $75.53 $66.27 $0.99 $45.18 $1.00 $0.54 $4.66 $16.49 $210.66

Large Painting Size (284 ft2) 4.97 $94.41 $75.63 $1.24 $45.93 $1.07 $0.72 $6.34 $20.58 $245.92

1 A “bathroom size” or “kitchen size” indicates the event size, not the event type. In addition to bathroom and kitchen events, other event types having these size definitions are:

bathroom size: wall-disturbing events, addition events

kitchen size: wall-disturbing events, addition events, window/door replacements

bathroom + kitchen size: wall-disturbing events, addition events

2 One sample is required outside the work area and three samples are required per room in the work area: (1) floor sample, (2) window sill sample, and (3) window trough sample. However, floor

samples are not required on carpeted floors (so the minimum number of required samples may be as low as two if the work area is one room and all floors are carpeted). The estimated numbers of rooms

affected and the probability that floors are carpeted were estimated following the methodology developed for the 2008 LRRP rule analysis

3

See section 4.3.3 and Table 4-29 for a description of how these costs are calculated.

4

See section 4.3.5 for a description of how these costs are calculated.

5 These costs vary by the size and type of the event because of varying clearance failure rates; estimated clearance failure rates are more likely for events where more samples are required. In addition,

shipping costs are higher for clearance events where a kitchen or bathroom is inside the work area because renovators are assumed to use overnight shipping in order to allow occupants to access the

work area sooner.

Note: In order to calculate a total cost per event that applies to all jobs, the average re-cleaning costs are calculated across all jobs (i.e., those that require re-cleaning and those that do not).

Events excluding kitchens or bathrooms are calculated separately from events including kitchens and bathrooms, because kitchens and bathrooms have a different probability of being carpeted than the

rest of the house, and dust wipe samples are only taken on uncarpeted floors.

Deleted: EO 12866 Review Draft:

Deleted: January 20, 2010 Draft –

Deliberative, Predecisional – Do

not Quote, Cite, or Distribute

Deleted:
Economic Analysis for the LRRP Clearance Proposed Rule

Chapter 4 4-57

Table 4-49: Clearance Per-Event Costs Summary: Public and Commercial Building COFs

Size of Work Area for the

Event1

Average

Number of

Dust Wipe

Samples2

Average

Lab

Costs3,5

Average

Dust Wipe

Testing

Labor

Costs3,5

Average

Dust Wipe

Testing

Material

Costs3,5

Average

Total

Shipping3,5

Average

Report

Paperwork

3,5

Average

ReCleaning

Material4,5

Average

ReCleaning

Labor4,5

Average

ReCleaning

Travel4,5

Average

Total Costs

Per-Event5

Kindergarten (Public; 13,560 ft2) 19.08 $362.56 $195.78 $4.77 $31.72 $1.73 $92.36 $832.67 $59.82 $1,581.41

Kindergarten (Large Private;

13,560 ft2) 19.08 $362.56 $195.78 $4.77 $31.72 $1.73 $92.36 $832.67 $59.82 $1,581.41

Kindergarten (Small Private;

13,560 ft2) 19.08 $362.56 $195.78 $4.77 $31.72 $1.73 $92.36 $832.67 $59.82 $1,581.41

Pre-K + Kindergarten (Public;

15,674 ft2) 19.08 $362.56 $195.78 $4.77 $31.72 $1.73 $119.49 $1,077.25 $59.82 $1,853.11

Pre-K + Kindergarten (Large

Private; 15,674 ft2) 19.08 $362.56 $195.78 $4.77 $31.72 $1.73 $119.49 $1,077.25 $59.82 $1,853.11

Pre-K + Kindergarten (Small

Private; 15,674 ft2) 19.08 $362.56 $195.78 $4.77 $31.72 $1.73 $119.49 $1,077.25 $59.82 $1,853.11

Daycare Center (Renter-Occupied;

2,400 ft2) 10.79 $204.93 $125.36 $2.70 $27.52 $1.35 $6.11 $55.06 $37.06 $460.08

Daycare Center (Owner-Occupied;

2400 ft2) 10.79 $204.93 $125.36 $2.70 $27.52 $1.35 $6.11 $55.06 $37.06 $460.08

Daycare Center (Non-Profit who

performs some of own RRP; 2,400

ft2) 10.79 $204.93 $125.36 $2.70 $27.52 $1.35 $6.11 $55.06 $37.06 $460.08

Daycare Center (Non-Profit who

uses contractors; 2,400 ft2) 10.79 $204.93 $125.36 $2.70 $27.52 $1.35 $6.11 $55.06 $37.06 $460.08

Daycare Center (In Public School;

2,400 ft2) 10.79 $204.93 $125.36 $2.70 $27.52 $1.35 $6.11 $55.06 $37.06 $460.08

Daycare Center (In Large Private

School; 2,400 ft2) 10.79 $204.93 $125.36 $2.70 $27.52 $1.35 $6.11 $55.06 $37.06 $460.08

Daycare Center (In Small Private

School; 2,400 ft2) 10.79 $204.93 $125.36 $2.70 $27.52 $1.35 $6.11 $55.06 $37.06 $460.08

1 One sample is required outside the work area and three samples are required per room in the work area: (1) floor sample, (2) window sill sample, and (3) window trough sample. However, floor

samples are not required on carpeted floors (so the minimum number of required samples may be as low as two if the work area is one room and all floors are carpeted). The estimated numbers of rooms

affected were estimated following the methodology developed for the 2008 LRRP rule analysis

2

In order to calculate a total cost per event that applies to all jobs, the average re-cleaning costs are calculated across all jobs (i.e., those that require re-cleaning and those that do not).

3

See section 4.3.3 and Table 4-29 for a description of how these costs are calculated.

4

See section 4.3.5 for a description of how these costs are calculated.

5 The photocopy material and shipping costs vary by the size of the event because estimated clearance failure rates are more likely for events where more samples are required.

Deleted: EO 12866 Review Draft:

Deleted: January 20, 2010 Draft –

Deliberative, Predecisional – Do

not Quote, Cite, or Distribute

Deleted:
Economic Analysis for the LRRP Clearance Proposed Rule

Chapter 4 4-58

4.3.7 Total Dust Wipe Testing and Clearance Event Costs

Total costs are estimated by combining the total number of events affected by the proposed Clearance

Rule from Section 4.2 and the per-event dust wipe testing and clearance costs from the tables above.

Table 4-50 through Table 4-52 present the final number of events, per-event costs, and total costs for dust

wipe testing and clearance. Costs are presented by building tenure, building type, work area size, and

occurrence of a bathroom or kitchen event. The different size threshold options are displayed in three

separate tables: (1) the low threshold option, (2) the proposed option, and (3) the high threshold option.

Deleted: EO 12866 Review Draft:

Deleted: January 20, 2010 Draft –

Deliberative, Predecisional – Do

not Quote, Cite, or Distribute 4-61
Economic Analysis for the LRRP Clearance Proposed Rule

Chapter 4 4-59

Table 4-50: Total Target Housing First Year Costs: Low Threshold Option

Events (thousands) Unit Costs Total Costs (millions) Type SF-O MF-O SF-R MF-R SF-O MF-O SF-R MF-R SF-O MF-O SF-R MF-R Total

Dust Wipe Testing Events Excluding Kitchen or Bathroom

Bath 34 2 21 21 $121 $121 $127 $127 $4 1 $0.2 $2.6 $2.6 $9.5

Kit 102 6 33 31 $121 $121 $127 $127 $12.4 $0.7 $4 1 $3.9 $21.2

Bath+Kit 1 0 0 0 $186 $186 $191 $191 $0 2 $0.0 $0.0 $0.0 $0.3

S-Paint 53 3 25 38 $121 $121 $127 $127 $6 5 $0.4 $3 1 $4.9 $14.8

M-Paint 28 2 14 24 $139 $121 $131 $127 $3.8 $0.2 $1.8 $3.1 $9.0

L-Paint 26 1 13 23 $191 $147 $170 $152 $4 9 $0.2 $2 3 $3.6 $11.0

S-WD 96 5 32 30 $121 $121 $127 $127 $11.6 $0.7 $4.0 $3.8 $20.1

L-WD 101 6 32 31 $227 $159 $204 $164 $22.8 $0.9 $6.6 $5.1 $35.4

Subtotal 441 25 170 199 - - - - $66.5 $3.3 $24.6 $26.9 $121.3

Dust Wipe Testing Events Including Kitchens or Bathrooms

Bath 97 4 149 89 $143 $143 $148 $148 $13.8 $0.6 $22.0 $13.2 $49.7

Kit 116 7 141 149 $143 $143 $148 $148 $16.6 $1.0 $20.8 $22.1 $60.5

Bath+Kit 35 4 87 31 $217 $217 $223 $223 $7.5 $1.0 $19.3 $6.9 $34.7

S-Paint 4 0 6 3 $143 $143 $148 $148 $0.6 $0.0 $0 9 $0.5 $2.0

M-Paint 5 0 4 5 $155 $136 $147 $142 $0.8 $0.0 $0 5 $0.7 $2.1

L-Paint 2 0 5 2 $204 $158 $184 $164 $0.4 $0.0 $0 9 $0.3 $1.6

S-WD 6 0 5 0 $143 $148 $0.9 $0.0 $0.7 $0.0 $1.6

L-WD 16 1 10 5 $239 $169 $215 $175 $3.8 $0.1 $2 1 $0.8 $6.9

Subtotal 281 17 405 285 - - - - $44.5 $2.8 $67.2 $44.6 $159.0

Clearance Events Excluding Kitchen or Bathroom

Bath 8 0 5 5 $161 $161 $166 $166 $1.2 $0.1 $0.8 $0.8 $2.9

Kit 1 0 0 0 $163 $161 $168 $167 $0.2 $0.0 $0.0 $0.0 $0.3

Bath+Kit 0 0 0 0 $259 $257 $263 $262 $0.1 $0.0 $0.0 $0.0 $0.1

S-Paint 1 0 1 1 $162 $161 $167 $167 $0.2 $0.0 $0 1 $0.1 $0.4

M-Paint 0 0 0 0 $191 $163 $175 $168 $0.1 $0.0 $0.0 $0.1 $0.2

L-Paint 0 0 0 0 $271 $203 $237 $208 $0.1 $0.0 $0 1 $0.1 $0.2

S-WD 0 0 0 0 $161 $166 $0.1 $0.0 $0.0 $0.0 $0.1

L-WD 1 0 0 0 $325 $221 $288 $227 $0.2 $0.0 $0.0 $0.0 $0.2

Subtotal 13 1 6 7 - - - - $2.2 $0.1 $1.1 $1.1 $4.5

Clearance Events Including Kitchens or Bathrooms

Bath 4 0 6 3 $199 $199 $215 $215 $0.7 $0.0 $1 3 $0.7 $2.7

Kit 5 0 4 5 $203 $200 $218 $216 $0.9 $0.0 $1.0 $1.0 $3.0

Bath+Kit 3 0 6 2 $313 $310 $328 $327 $0.9 $0.1 $2 1 $0.7 $3.7

S-Paint 0 0 0 0 $201 $200 $217 $216 $0.0 $0.0 $0 1 $0.0 $0.2

M-Paint 0 0 0 0 $226 $194 $219 $211 $0.1 $0.0 $0.0 $0.1 $0.2

L-Paint 0 0 0 0 $302 $230 $278 $246 $0.0 $0.0 $0 1 $0.0 $0.2

S-WD 0 0 0 0 $199 $215 $0.0 $0.0 $0.0 $0.0 $0.1

L-WD 1 0 0 0 $354 $248 $327 $264 $0.3 $0.0 $0 1 $0.0 $0.5

Subtotal 13 1 18 11 - - - - $3.0 $0.2 $4.7 $2.6 $10.5

All Events

Total 747 43 599 501 - - - - $116 2 $6.4 $97.6 $75.2 $295.3

The following abbreviations are used: SF-O indicates single-family owner-occupied; MF-O indicates multi-family owneroccupied; SF-R indicates single-family renter-occupied; MF-R indicates multi-family renter-occupied; Bath indicates a

bathroom size event; Kit indicates a kitchen size event, Bath+Kit indicates an event the size of a bathroom and a kitchen

combined; S-Paint indicates a small painting sized event; M-Paint indicates a small painting sized event; L-Paint indicates

a small painting sized event; S-WD indicates a small window/door sized event; L-WD indicates a large window/door

sized event. A “bathroom size” or kitchen size” indicates the event size, not the event type. In addition to bathroom and

kitchen events, other event types having these size definitions are: (1) Bathroom size: wall-disturbing events, addition

events, (2) Kitchen size: wall-disturbing events, addition events, window/door replacements, (3) Bathroom + kitchen size:

wall-disturbing events, addition events. “0” and “0.0” indicate more than zero but fewer than 500 and 50 events

respectively. Events excluding kitchens or bathrooms are calculated separately from events including kitchens and

bathrooms, because kitchens and bathrooms have a different probability of being carpeted than the rest of the house, and

dust wipe samples are only taken on uncarpeted floors. Clearance costs include the cost of associated dust wipe testing.

Deleted: EO 12866 Review Draft:

Deleted: January 20, 2010 Draft –

Deliberative, Predecisional – Do

not Quote, Cite, or Distribute 4-61
Economic Analysis for the LRRP Clearance Proposed Rule

Chapter 4 4-60

Table 4-51: Total Target Housing First Year Costs: Proposed Option

Events (thousands) Unit Costs Total Costs (millions) Type SF-O MF-O SF-R MF-R SF-O MF-O SF-R MF-R SF-O MF-O SF-R MF-R Total

Dust Wipe Testing Events Excluding Kitchen or Bathroom

Bath 17 1 11 10 $121 $121 $127 $127 $2.1 $0 1 $1.3 $1 3 $4.8

Kit 104 6 35 32 $121 $121 $127 $127 $12.7 $0.7 $4.4 $4.0 $21 8

Bath+Kit 1 0 0 0 $186 $186 $191 $191 $0.1 $0.0 $0.0 $0.0 $0.1

S-Paint 42 2 19 30 $121 $121 $127 $127 $5.1 $0 3 $2.5 $3.8 $11.6

M-Paint 22 1 11 19 $139 $121 $131 $127 $3.0 $0 2 $1.4 $2.4 $7.0

L-Paint 20 1 10 18 $191 $147 $170 $152 $3.8 $0 2 $1.8 $2.8 $8.6

S-WD 101 6 34 31 $121 $121 $127 $127 $12.2 $0.7 $4.3 $4.0 $21 2

L-WD 104 6 35 32 $227 $159 $204 $164 $23.6 $0 9 $7.1 $5 3 $36 9

Subtotal 410 23 155 173 - - - - $62.6 $3.1 $22.9 $23.6 $112.1

Dust Wipe Testing Events Including Kitchens or Bathrooms

Bath 52 2 80 48 $143 $143 $148 $148 $7.5 $0 3 $11.9 $7 1 $26 8

Kit 102 6 124 133 $143 $143 $148 $148 $14.6 $0 9 $18.3 $19.6 $53.4

Bath+Kit 35 5 87 31 $217 $217 $223 $223 $7.6 $1.0 $19.4 $6 9 $34 9

S-Paint 4 0 5 3 $143 $143 $148 $148 $0.5 $0.0 $0.7 $0.4 $1.7

M-Paint 4 0 3 4 $155 $136 $147 $142 $0.6 $0.0 $0.4 $0.6 $1.7

L-Paint 2 0 4 1 $204 $158 $184 $164 $0.4 $0.0 $0.7 $0 2 $1.3

S-WD 3 0 3 0 $143 $148 $0.5 $0.0 $0.4 $0.0 $0.8

L-WD 13 1 7 4 $239 $169 $215 $175 $3.0 $0 1 $1.6 $0.6 $5.4

Subtotal 215 14 313 224 - - - - $34.6 $2.4 $53.5 $35.5 $126.0

Clearance Events Excluding Kitchen or Bathroom

Bath 8 0 5 5 $161 $161 $166 $166 $1.3 $0 1 $0.9 $0.8 $3.1

Kit 2 0 0 0 $163 $161 $168 $167 $0.3 $0.0 $0.0 $0.0 $0.4

Bath+Kit 0 0 0 0 $259 $257 $263 $262 $0.1 $0.0 $0.0 $0.0 $0.1

S-Paint 1 0 1 1 $162 $161 $167 $167 $0.2 $0.0 $0.1 $0 1 $0.4

M-Paint 0 0 0 0 $191 $163 $175 $168 $0.1 $0.0 $0.0 $0 1 $0.2

L-Paint 0 0 0 0 $271 $203 $237 $208 $0.1 $0.0 $0.1 $0 1 $0.3

S-WD 0 0 0 0 $161 $166 $0.1 $0.0 $0.0 $0.0 $0.1

L-WD 1 0 0 0 $325 $221 $288 $227 $0.2 $0.0 $0.0 $0.0 $0.3

Subtotal 13 1 7 7 - - - - $2.3 $0.1 $1.2 $1.2 $4.8

Clearance Events Including Kitchens or Bathrooms

Bath 4 0 5 3 $199 $199 $215 $215 $0.7 $0.0 $1.2 $0.7 $2.6

Kit 4 0 5 5 $203 $200 $218 $216 $0.9 $0.0 $1.0 $1.0 $3.0

Bath+Kit 3 0 6 2 $313 $310 $328 $327 $0.8 $0 1 $2.0 $0.7 $3.6

S-Paint 0 0 0 0 $201 $200 $217 $216 $0.0 $0.0 $0.1 $0.0 $0.1

M-Paint 0 0 0 0 $226 $194 $219 $211 $0.1 $0.0 $0.0 $0.0 $0.1

L-Paint 0 0 0 0 $302 $230 $278 $246 $0.0 $0.0 $0.1 $0.0 $0.2

S-WD 0 0 0 0 $199 $215 $0.0 $0.0 $0.0 $0.0 $0.1

L-WD 1 0 0 0 $354 $248 $327 $264 $0.3 $0.0 $0.1 $0.0 $0.5

Subtotal 12 1 17 11 - - - - $2.9 $0.2 $4.5 $2.5 $10.1

All Events

Total 650 39 493 414 - - - - $102.4 $5.7 $82.0 $62.8 $253.0

The following abbreviations are used: SF-O indicates single-family owner-occupied; MF-O indicates multi-family

owner-occupied; SF-R indicates single-family renter-occupied; MF-R indicates multi-family renter-occupied; Bath

indicates a bathroom size event; Kit indicates a kitchen size event, Bath+Kit indicates an event the size of a bathroom

and a kitchen combined; S-Paint indicates a small painting sized event; M-Paint indicates a small painting sized event;

L-Paint indicates a small painting sized event; S-WD indicates a small window/door sized event; L-WD indicates a

large window/door sized event. A “bathroom size” or kitchen size” indicates the event size, not the event type. In

addition to bathroom and kitchen events, other event types having these size definitions are: (1) Bathroom size: walldisturbing events, addition events, (2) Kitchen size: wall-disturbing events, addition events, window/door replacements,

(3) Bathroom + kitchen size: wall-disturbing events, addition events. “0” and “0.0” indicate more than zero but fewer

than 500 and 50 events respectively. Events excluding kitchens or bathrooms are calculated separately from events

including kitchens and bathrooms, because kitchens and bathrooms have a different probability of being carpeted than

the rest of the house, and dust wipe samples are only taken on uncarpeted floors. Clearance costs include the cost of

associated dust wipe testing.

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Table 4-52: Total Target Housing First Year Costs: High Threshold Option

Events (thousands) Unit Costs Total Costs (millions) Type SF-O MF-O SF-R MF-R SF-O MF-O SF-R MF-R SF-O MF-O SF-R MF-R Total

Dust Wipe Testing Events Excluding Kitchen or Bathroom

Bath 7 0 5 4 $121 $121 $127 $127 $0.9 $0.0 $0.6 $0.6 $2.1

Kit 108 6 37 33 $121 $121 $127 $127 $13.1 $0.7 $4.7 $4.2 $22.7

Bath+Kit 0 0 0 0 $186 $186 $191 $191 $0.0 $0.0 $0.0 $0.0 $0.1

S-Paint 12 1 5 8 $121 $121 $127 $127 $1.4 $0.1 $0.7 $1.0 $3.2

M-Paint 6 0 3 5 $139 $121 $131 $127 $0.8 $0.0 $0.4 $0.6 $1.8

L-Paint 5 0 3 5 $191 $147 $170 $152 $1.0 $0.0 $0.5 $0.7 $2.2

S-WD 106 6 37 33 $121 $121 $127 $127 $12.9 $0.7 $4.6 $4.2 $22.4

L-WD 107 6 37 33 $227 $159 $204 $164 $24.3 $1.0 $7.5 $5.4 $38.2

Subtotal 351 20 126 121 - - - - $54.5 $2.6 $18.9 $16.7 $92.7

Dust Wipe Testing Events Including Kitchens or Bathrooms

Bath 25 1 38 22 $143 $143 $148 $148 $3 5 $0.2 $5.6 $3.3 $12.7

Kit 84 5 102 110 $143 $143 $148 $148 $11 9 $0.7 $15 1 $16.2 $43.9

Bath+Kit 32 4 80 29 $217 $217 $223 $223 $7.0 $0.9 $17 9 $6.4 $32.2

S-Paint 3 0 4 3 $143 $143 $148 $148 $0 5 $0.0 $0.7 $0.4 $1.6

M-Paint 4 0 3 4 $155 $136 $147 $142 $0.6 $0.0 $0.4 $0.6 $1.7

L-Paint 2 0 4 1 $204 $158 $184 $164 $0 3 $0.0 $0.7 $0.2 $1.3

S-WD 2 0 1 0 $143 $148 $0 2 $0.0 $0 2 $0.0 $0.4

L-WD 10 1 6 3 $239 $169 $215 $175 $2 3 $0.1 $1 2 $0.5 $4.1

Subtotal 161 11 238 172 - - - - $26.5 $1.9 $41.8 $27.6 $97.8

Clearance Events Excluding Kitchen or Bathroom

Bath 7 0 5 5 $161 $161 $166 $166 $1 2 $0.1 $0.8 $0.7 $2.8

Kit 2 0 0 0 $163 $161 $168 $167 $0 3 $0.0 $0 1 $0.0 $0.4

Bath+Kit 0 0 0 0 $259 $257 $263 $262 $0 1 $0.0 $0.0 $0.0 $0.1

S-Paint 1 0 0 0 $162 $161 $167 $167 $0 1 $0.0 $0.0 $0.1 $0.2

M-Paint 0 0 0 0 $191 $163 $175 $168 $0.0 $0.0 $0.0 $0.0 $0.1

L-Paint 0 0 0 0 $271 $203 $237 $208 $0 1 $0.0 $0.0 $0.0 $0.1

S-WD 0 0 0 0 $161 $166 $0 1 $0.0 $0.0 $0.0 $0.1

L-WD 1 0 0 0 $325 $221 $288 $227 $0 2 $0.0 $0.0 $0.0 $0.2

Subtotal 11 1 6 6 - - - - $2.0 $0.1 $1.1 $1.0 $4.1

Clearance Events Including Kitchens or Bathrooms

Bath 3 0 5 3 $199 $199 $215 $215 $0.6 $0.0 $1.0 $0.6 $2.2

Kit 4 0 4 4 $203 $200 $218 $216 $0.8 $0.0 $0 9 $0.9 $2.6

Bath+Kit 2 0 5 2 $313 $310 $328 $327 $0.6 $0.1 $1.6 $0.5 $2.8

S-Paint 0 0 0 0 $201 $200 $217 $216 $0.0 $0.0 $0.0 $0.0 $0.1

M-Paint 0 0 0 0 $226 $194 $219 $211 $0.0 $0.0 $0.0 $0.0 $0.1

L-Paint 0 0 0 0 $302 $230 $278 $246 $0.0 $0.0 $0 1 $0.0 $0.1

S-WD 0 0 0 0 $199 $215 $0.0 $0.0 $0.0 $0.0 $0.1

L-WD 1 0 0 0 $354 $248 $327 $264 $0 2 $0.0 $0 1 $0.0 $0.4

Subtotal 10 1 15 9 - - - - $2.4 $0.2 $3.8 $2.1 $8.4

All Events

Total 534 32 385 307 - - - - $85 3 $4.8 $65 5 $47.4 $203.0

The following abbreviations are used: SF-O indicates single-family owner-occupied; MF-O indicates multi-family

owner-occupied; SF-R indicates single-family renter-occupied; MF-R indicates multi-family renter-occupied; Bath

indicates a bathroom size event; Kit indicates a kitchen size event, Bath+Kit indicates an event the size of a bathroom

and a kitchen combined; S-Paint indicates a small painting sized event; M-Paint indicates a small painting sized event;

L-Paint indicates a small painting sized event; S-WD indicates a small window/door sized event; L-WD indicates a

large window/door sized event. A “bathroom size” or kitchen size” indicates the event size, not the event type. In

addition to bathroom and kitchen events, other event types having these size definitions are: (1) Bathroom size: walldisturbing events, addition events, (2) Kitchen size: wall-disturbing events, addition events, window/door replacements,

(3) Bathroom + kitchen size: wall-disturbing events, addition events. “0” and “0.0” indicate more than zero but fewer

than 500 and 50 events respectively. Events excluding kitchens or bathrooms are calculated separately from events

including kitchens and bathrooms, because kitchens and bathrooms have a different probability of being carpeted than

the rest of the house, and dust wipe samples are only taken on uncarpeted floors. Clearance costs include the cost of

associated dust wipe testing.

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Table 4-53: Total Public and Commercial Building COF First Year Costs

Events Unit Costsa Total Costs

Building Type DWT Clearance DWT Clearance DWT Clearance Total

Kindergarten (Public) 158 35 $465 $1,876 $73,449 $64,824 $138,273

Kindergarten (Large Private) 23 5 $465 $1,876 $10,481 $9,250 $19,730

Kindergarten (Small Private) 27 6 $465 $1,876 $12,412 $10,818 $23,230

Pre-K + Kindergarten (Public) 123 27 $465 $2,147 $57,383 $57,800 $115,183

Pre-K + Kindergarten (Large Private) 67 15 $465 $2,147 $31,351 $31,579 $62,931

Pre-K + Kindergarten (Small Private) 34 7 $465 $2,147 $15,780 $16,056 $31,836

Daycare Center (Renter-Occupied) 171 37 $416 $688 $71,004 $25,674 $96,678

Daycare Center (Owner-Occupied) 117 26 $416 $688 $48,670 $17,598 $66,269

Daycare Center (Non-Profit who

performs some of own RRP) 149 32 $416 $688 $61,873 $22,372 $84,245

Daycare Center (Non-Profit who uses

contractors) 55 12 $416 $688 $22,771 $8,234 $31,005

Daycare Center (In Public School) 8 2 $416 $688 $3,256 $1,177 $4,434

Daycare Center (In Large Private

School) 0 0 $416 $688 $16 $6 $22

Daycare Center (In Small Private

School) 0 0 $416 $688 $32 $12 $44

All Building Types 930 203 -- -- $408,479 $265,399 $673,878

a. These unit costs for events in public and commercial building COFs are third party costs since the analysis assumes that nonresidential contractors and operators of public and commercial building COFs will not perform enough dust wipe testing or

clearance events annually to make training an in-house dust sampling technician worthwhile. A zero indicates that fewer than

0.5 events are performed on average each year.

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4.4 Number of Sampling Technicians Seeking Training and Certification

The proposed LRRP clearance rule would require all entities that conduct certain RRP activities known to

generate high levels of lead dust to either hire a third party or use an employee trained as a dust sampling

technician to perform post-renovation dust sampling. A trained dust sampling technician is an individual

who has successfully completed a dust sampling technician course accredited by EPA or an EPAauthorized State or Tribal program. It is expected that two types of construction businesses will perform

regulated RRP work – businesses with employees and non-employer, or self-employed, contractors. In

addition, rental companies are likely to perform some of the RRP work on the properties they manage

rather than hire an outside contractor. Likewise, schools and daycare centers are likely to perform some

or all of their RRP work with their own staff. Depending on the average number of events triggering dust

wipe testing or clearance requirements performed by an entity each year, it will be cost-effective for some

entities to use third-party dust sampling technicians and others to train their own dust sampling

technician. The sections below present an analysis of which firms and entities would choose to train their

own dust sampling technician as well as an estimate of the number of personnel requiring additional

training under the proposed LRRP Clearance Rule.

4.4.1 Residential Activities: Estimating the Number of Personnel Obtaining Training to

Meet the Demand for Dust Wipe Testing and Clearance Services

4.4.1.1 Firms Certified Under the 2008 LRRP rule and the 2009 Proposed Opt-Out Rule

This analysis utilizes the total estimated numbers of firms seeking certification from the economic

analysis of the 2008 LRRP rule (EPA 2008) and the economic analysis of the 2009 proposed Opt-Out rule

(EPA 2009). The general approach used by EPA (2008, 2009) was to obtain Census estimates of the total

number of establishments in affected industries and adjust these estimates to account for the fact that not

all work performed in these industries is affected by the rule. Note that Census data are only available for

establishments and not firms. These data are used as the basis for estimating the number of firms that will

pursue training for a dust sampling technician.

The total numbers of establishments are adjusted in three ways: (1) according to the share of their

revenues that come from residential work, (2) to reflect the share of the housing stock that is affected by

the 2009 proposed Opt-Out Rule, and (3) to reflect a 75 percent compliance rate following previous

analyses (EPA 2008, 2009). These adjustments imply that there will be some degree of specialization in

regulated work. They do not, however, imply full specialization in regulated work. For example, the

adjustments do not fully reflect the share of RRP work that does not disturb any painted surfaces or the

disproportionate amount of residential work that is related to new construction. Adjusting for these two

factors would imply more specialization and result in a lower estimate of the number of affected firms

and personnel.

The numbers of certified firms performing RRP in target housing under the 2008 LRRP Rule and the

subsequent 2009 proposed Opt-Out Rule are estimated in three segments: (1) residential construction

establishments with employees and (2) non-employer residential construction establishments (i.e., selfemployed contractors). Note that this analysis excludes the following construction and real estate sectors

expected to be affected by the 2008 LRRP rule but not the proposed LRRP Clearance Rule: (1) siding

contractors, (2) other building equipment contractors, (3) other building finishing contractors, (4) glass

and glazing contractors.

11 In addition, this analysis assumes that residential property managers and lessors

do not perform the RRP activities that would require dust wipe testing or clearance under the proposed

11 Renovators in these sectors are not expected to typically perform the types of renovation events that require dust wipe testing

or clearance under the proposed rule.

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rule. These activities are primarily major renovations such as kitchen remodeling, bathroom remodeling

and window and door replacement. The more minor and routine RRP activities that would be expected to

be performed by property manager and lessor staff, such as re-painting a rental unit, would generally not

require using the paint removal practices that trigger the proposed clearance rule requirements. To the

extent that property manager and lessors have staff that perform activities that would be covered by the

proposed LRRP Clearance Rule, this analysis may be slightly understating the costs of performing these

activities (by not including dust sampling technician training costs for these firms). Note that another

implication of this assumption is that the estimated small business impacts (presented in Chapter 6) on

construction firms are higher, since the costs associated with a larger number of events are attributed to a

smaller number of firms. Table 4-54 presents the estimated number of firms in each segment expected to

seek LRRP program certification under the 2008 LRRP rule and the 2009 proposed Opt-Out rule.

Table 4-54: Total Number of Residential RRP Firms Certified under LRRP Program in First

Year

NAICS Description

Number of

Employer

Estab. in

Industry

Residential

Adjustment Factor:

Residential Revenues

as a Percent of Total

Value of Construction

Number of Estab.,

Adjusted by Percentage

of Housing Stock

Affected (65%),

Residential Adjustment

Factor, and Assumed

Compliance Rate (75%)

Employer Construction Establishments

236118 Residential remodelers 82,747 56% 22,590

238350 Finish carpentry 35,087 50% 8,552

238340 Tile and terrazzo 8,950 28% 1,222

238220 Plumbing and HVAC 87,501 27% 11,517

238320 Painting and wall covering 38,943 25% 4,746

238210 Electrical contractors 62,586 23% 7,018

238310 Drywall and insulation 19,598 21% 2,006

Subtotal 335,412 35% 57,651

Non-Employer Construction Establishments

236118 Residential remodelers 194,182 56% 53,012

238350 Finish carpentry 185,118 50% 45,122

238340 Tile and terrazzo 47,220 28% 6,446

238220 Plumbing and HVAC 110,183 27% 14,503

238320 Painting and wall covering 205,462 25% 25,041

238210 Electrical contractors 102,219 23% 11,462

238310 Drywall and insulation 103,398 21% 10,586

Subtotal 947,782 36% 166,170

All Residential RRP Firms 223,821

Source U.S. Census Bureau 2003; U.S. Census Bureau 2005d,i,j; U.S. Small Business Administration 2005;

EPA Calculations

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4.4.1.2 Estimating the Stock of Trained Dust Sampling Technicians Necessary to Meet Demand

for Dust Wipe Testing and Clearance Services in Target Housing

The proposed LRRP Clearance rule requires firms to ensure that dust wipe testing and clearance activities

covered by the rule are performed by certified dust sampling technicians, inspectors, or risk-assessors. To

estimate the number of individuals that will seek dust sampling technician training, the analysis first

considered whether it would be more cost effective for firms to: (1) obtain dust sampling technician

training for one of their employees, or (2) use a third party to conduct dust wipe testing. Thus, a firm must

perform a minimum number of dust wipe testing or clearance events annually for the cost savings from

performing this activity with their own employee to outweigh the dust sampling technician training costs.

Following the analysis of the 2008 LRRP rule (EPA 2008), it is assumed that the number of events

performed per firm is proportional to the number of employees per firm. The average employment size

was calculated by dividing the number of construction employees by the number of establishments in

each industry (See Table 4-55). For non-employer firms, it is assumed that one person performs all the

RRP work. Table 4-55 presents both the number of dust wipe testing and clearance events for the

proposed option.

Table 4-55: Construction Employees and Annual Dust Wipe Testing and Clearance Events Per

Establishment (Proposed Option)

NAICS Description

Number of

Certified Estab.

in Industry

Number of

Construction

Workers

Employed by

Certified Estab.

Employees Per

Estab.

Annual Number

of Dust Wipe

Testing and

Clearance Events

Per Estab.

Employer Construction Establishments

236118 Residential remodelers 22,590 56,684 2.5 8.5

238350 Finish carpentry 8,552 31,660 3.7 12.5

238340 Tile and terrazzo 1,222 6,106 5.0 16.9

238220 Plumbing and HVAC 11,517 93,776 8.1 27.6

238320 Painting and wall covering 4,746 22,465 4.7 16.0

238210 Electrical contractors 7,017 67,993 9.7 32.8

238310 Drywall and insulation 2,006 26,744 13.3 45.1

Non-Employer Construction Establishments

236118 Residential remodelers 53,012 n.a. n.a. 3.4

238350 Finish carpentry 45,123 n.a. n.a. 3.4

238340 Tile and terrazzo 6,446 n.a. n.a. 3.4

238220 Plumbing and HVAC 14,503 n.a. n.a. 3.4

238320 Painting and wall covering 25,041 n.a. n.a. 3.4

238210 Electrical contractors 11,461 n.a. n.a. 3.4

238310 Drywall and insulation 10,585 n.a. n.a. 3.4

All Residential RRP Firms 223,821 305,428 6.4 8.2

Source U.S. Census Bureau 2005i,j; U.S. Small Business Administration 2005; EPA Calculations

*Non-employer establishments by definition have no employees; it is estimated that these establishments are self-employed

contractors which perform 2.8 Clearance Rule events per year, or the average number for one employee in an employer

construction firm.

Given the average annual number of dust wipe testing and clearance events performed by each category

of firm, estimates of third party and in-house dust wipe testing costs can be compared to determine the

most cost-effective approach to dust-wipe sampling. This comparison is presented in Table 4-56. Since

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the firm category with the maximum number of annual dust wipe testing and clearance events only has an

average of 37.8 of these events annually (“Drywall and insulation contractors”), and each dust wipe

testing event requiring four samples only takes on average 1.75 hours, it is reasonable to assume that no

firm would need to train more than one dust sampling technician for an annual maximum total of 66 hours

of work per year. 12

Given that the expected amount firms save by using their own dust sampling technicians is much greater

than the annualized cost of dust sampling technician training ($146)13 for certified firms in all of the

sectors shown in Table 4-56, this analysis assumes that each establishment will choose to incur training

costs for one dust sampling technician. Note that this result also holds true for the alternative options

considered in this analysis (not shown in table).

Table 4-56: Cost Comparison for Third Party and In-House Dust Sampling Technicians (Proposed

Option)

NAICS Description

Annual Dust

Wipe Testing

and Clearance

Events

Annual Cost Per

Firm for Third

Party Servicesa

Annual Cost Per

Firm for InHouse Dust

Sampling

Technicianb

Annual Savings

Per Firm from

Using an InHouse Dust

Sampling

Technician

Employer Construction Establishments

236118 Residential remodelers 8.5 $2,529 $1,420 $1,109

238350 Finish carpentry 12.5 $3,731 $2,096 $1,635

238340 Tile and terrazzo 16.9 $5,037 $2,829 $2,208

238220 Plumbing and HVAC 27.6 $8,206 $4,609 $3,597

238320 Painting and wall covering 16.0 $4,771 $2,679 $2,091

238210 Electrical contractors 32.8 $9,766 $5,485 $4,281

238310 Drywall and insulation 45.1 $13,435 $7,546 $5,889

Non-Employer Construction Establishments

236118 Residential remodelers 3.4 $1,008 $566 $442

238350 Finish carpentry 3.4 $1,008 $566 $442

238340 Tile and terrazzo 3.4 $1,008 $566 $442

238220 Plumbing and HVAC 3.4 $1,008 $566 $442

238320 Painting and wall covering 3.4 $1,008 $566 $442

238210 Electrical contractors 3.4 $1,008 $566 $442

238310 Drywall and insulation 3.4 $1,008 $566 $442

All Residential RRP Firms 8.2 $2,431 $1,365 $1,065

a,b All costs are calculated using unrounded number of events; a 3 percent discount rate is used.

12 The average amount of labor time necessary for a dust sampling event with four required samples was estimated using primary

data collection of 9 lead evaluation firms. The specific results of this survey are available in Section 4 3.1.

13 This average cost is calculated by dividing the 50-year average dust sampling technician training costs ($29,563,881) by the

50-year average number of firms expected to seek dust sampling technician training (202,745).

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4.4.2 Public and Commercial Building Activities: Estimating the Number of Personnel

Obtaining Training to Meet the Demand for Dust Wipe Testing and Clearance

Services

This analysis compared the costs of using third party dust sampling technicians with the costs of training

a dust sampling technician for those public and commercial building owners that perform RRP using their

own staff. However, since this analysis estimates that staff in public and commercial building COFs will

perform activities requiring dust wipe testing or clearance relatively infrequently, the per-event cost

savings from having a trained dust sampling technician on staff are not large enough to justify the dust

sampling technician training costs. The additional costs associated with using third party testing for a

dust wipe testing or clearance event in a public or commercial building is estimated to range from $149 to

$161, which is well below the estimated costs of obtaining dust sampling technician training, $621. Thus,

the analysis assumes that public and commercial building COFs will use third party testing in lieu of

training their own dust sampling technician.

The economic analysis for the 2008 LRRP rule estimated that there would be 3,223 nonresidential

contractors seeking certification in the first year of the rule’s implementation, and that these contractors

would perform an average of 280,434 events per year (EPA 2008). However, since this analysis

estimates that non-residential contractors will perform only an average of 406 dust wipe testing or

clearance events annually, or one regulated event about every eight years on average, the additional costs

associated with third party testing, $155, are lower than the dust sampling training cost of $621.14, Thus, it

is assumed that these nonresidential building contractors will use third party testing rather than obtain

dust sampling technician training for one of their employees. Note that although the analysis makes the

simplifying assumption that third party testing will always be used for dust wipe testing and clearance

events in public and commercial buildings, in reality some firms with trained dust sampling technicians

may perform some of this work. These firms could be non-residential contractors specializing in dust

wipe testing and clearance work, or they could be firms that also perform dust wipe testing and clearance

in residential units. To the extent that third party testing is not used, this analysis may be overstating the

costs of dust wipe testing and clearance for these structures.

4.4.3 Estimating the Number of Personnel Seeking Training Each Year Under the LRRP

Clearance Proposed Rule

The number of individuals seeking training in any given year is estimated from the stock of firms and

individuals necessary to meet demand for dust wipe testing services. (Because training is valid for five

years, the annual number trained each year after the first year is a fraction of the total stock of trained

individuals and certified firms).

Note that many of the additional dust sampling technicians that are expected undergo training because of

the proposed LRRP Clearance Rule are likely to seek training before the provision goes into effect.

However, this analysis utilizes the simplifying assumption that any additional initial training takes place

over a 12 month period starting from the date of the expansion of the regulated universe.

4.4.3.1 Training after the Initial Years

Following the 2008 LRRP rule analysis (EPA 2008), this analysis assumes a steady annual number of

individual trainings following the first year of regulation with an annual decline of 0.41 percent. Note

14 This analysis assumes that private schools, public schools, and non-profit daycare centers which use in-house staff to perform

RRP will perform all window/door carpentry work in-house. Non-residential contractor firms will perform all other RRP.

Non-residential contractor firms will perform all RRP events in owner-occupied daycare centers, daycare centers that do not

perform all of their own RRP (i e., contract some of it out), and small private schools.

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that if all the individuals needed to meet the demand for clearance requirements were trained in the first

year, one might expect a drop in the level of training in the second year, followed by a spike in the fifth

year. That is, one might expect a cyclical pattern of training to emerge. However, it is difficult to predict

how cyclical the training demand might be or how this cyclicality might diminish over time. Therefore,

this analysis assumes that a typical amount of training occurs each year after the first year. Modeling a

cyclical component would add little to the analysis without being able to estimate the extent of any

cyclicality more precisely.

The analysis does account for trained individuals that exit the industry each year and are replaced by new

entrants. This analysis accounts for turnover in the regulated RRP industry by assuming a certain

percentage of trainings each year are initial trainings. Specifically, after the first year, 86.7% percent of

the dust sampling technicians seeking training are assumed to be seeking their initial certification. This

percentage is based on the relative number of Abatement Supervisors applying for initial certifications

according to the Federal Lead-Based Paint Program (FLPP) database (EPA 2005).15

4.4.3.2 Summary of Number of Individuals Trained to Perform Dust Wipe Testing and Clearance

Table 4-57 presents a summary of the estimated stock of dust sampling technicians that will perform RRP

requiring dust wipe testing or clearance. The number of trained personnel are segmented by establishment

type: employer construction, non-employer construction, and residential property manager and lessor. As

demonstrated in Section 4.4.2, no employees working in public and commercial buildings are expected to

seek dust sampling technician training. In year one, a total of 223,821 trained dust sampling technicians

will be necessary to perform dust wipe testing and clearance services for regulated residential RRP. As

described above, this number decreases by 0.41% each year to account for the decline in pre-1978

building stock.

Table 4-57: Estimated Stock of Trained Dust Sampling Technicians and Certified

Firms to Perform RRP, by Year

Year Stock of Trained Dust

Sampling Technicians Initial Trainings Refresher Trainings

Employer Construction Establishments

Year 1 57,651 57,651 0

Year 2 57,415 9,952 1,531

Non-Employer Construction Establishments

Year 1 166,170 166,170 0

Year 2 165,489 28,685 4,413

All Establishments

Year 1 233,821 233,821 0

Year 2 222,904 38,637 5,944

4.5 Sampling Technician Training Costs

Training costs include the cost of the time spent on training activities as well as the associated travel and

tuition costs. Note that tuition costs are assumed to include the costs associated with training provider

accreditation. In other words, it is assumed that accredited training providers pass along their

15 It was found in this study of a training certification program that lasted three years that in a given year, 52% of individuals

seeking training were seeking initial training, and 48% were seeking refresher training. This percentage was adjusted to

apply to a 5-year training cycle (86.7%) by multiplying 52% by five-thirds.

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accreditation fees and other administrative costs through their tuition. These accreditation fees and other

administrative costs are estimated in the paperwork burden analysis but are only implicitly accounted for

(as part of tuition costs) in the estimates of the total cost of the rule.

4.5.1 Training Burden Per Individual

To estimate the incremental burden of training dust sampling technicians, several cost components are

calculated including tuition rates, wage rates, and travel and expense costs. Each certified dust sampling

technician will participate in 8 hours of formal initial training. Refresher dust sampling technician

certification training is required every five years; the refresher course is four hours.

Tuition for the initial certified dust sampling technician training class is estimated to be $205 and each

corresponding refresher course’s tuition is estimated to be $103. This estimate relies on the assumption

that the average hourly tuition is equal to the observed rates for the accredited lead abatement and

evaluation courses ($23.26/hr). This value is then converted to 2008 dollars.16 Additional travel and meal

costs associated with training are assumed to be $134 (EPA 2006).17 Digital photos of each certified dust

sampling technician are also added into the additional costs. The total cost for a one-time use digital

camera that takes 25 pictures is $14 ($0.56 per picture taken). The total time allotted to taking and

processing these photos is estimated at 3 minutes ($1.20), which results in a total cost of $1.76 (or $2 in

2008 dollars). For a class size of 10 students, 3 minutes per student is equivalent to a total time of 30

minutes to take the digital photos, associate them with the appropriate students, and insert the photos onto

the training certificates.

The value of the time for certified dust sampling technicians to receive formal initial training is $279 (8

hours at a loaded wage rate of $34.92/hour); for refresher training the value is $140 (EPA 2006).

Certified dust sampling technicians might be self-employed or employed by a larger company. Therefore,

the value of time is likely to represent a mix of lost wages and additional overhead to firms. As shown in

Table 4-58, the aggregated incremental cost of training is $621 for initial certified dust sampling

technician training and $378 for refresher certified dust sampling technician training.

Table 4-58: Dust Sampling Technician Training Costs Per Individual (2008$)

Tuition Value of Time

Travel and

Meals

Digital

Photo Total

Initial Training $205 $279 $134 $2 $621

Refresher Training $103 $140 $134 $2 $378

Sources BLS 2008, IRS 2008, EPA 2006

4.5.2 Total Training Costs

Table 4-59 presents the total training costs of the rule for the first three years. The number of dust

sampling technicians seeking training is described in Section 4.4.3; the value of training time for dust

sampling technicians is described in Section 4.5.1. The average training cost per renovator varies in the

initial years of the regulation according to the relative number of initial and refresher trainings. After the

16 The average of the hourly tuition rates are used rather than picking a single similar course because no single

course is similar enough to the dust sampling technician course. For example, the initial courses are the only

courses with hands-on training, but they are also longer than the technician course. The refresher courses are

more similar in length, but have no hands on requirements.

17 Travel costs include 2 hours of travel time ($70), meals ($10), and mileage costs (50 miles, $54).

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first year, 86.7 percent of contractors and public or commercial building renovators receive initial training

(due to turnover in the industry) and the rest obtain refresher training. Note that an individual who

received initial training and let their certification expire must retake the initial training. The stock of

regulated structures declines by 0.41 percent annually which also reduces the demand for lead-safe

renovation services, the number of dust sampling technicians seeking training, and the undiscounted total

training costs. As shown in Table 4-59, total training costs for Year 1 will be $138,993,017 and total

training costs for Year 2 will be $25,475,936.

Table 4-59: Total Dust Sampling Technician Training Costs (2008$)

Year Type of

Training

Number of Dust

Sampling

Technicians

Seeking Training

Average Cost of

Training

Total Training

Cost (2008$,

before

discounting)

Year 1 Initial 223,821 $621 $138,993,017

Initial Year 2 38,637 $621 $23,993,345

Refresher 5,944 $378 $2,246,868

4.6 Total Incremental Costs of Proposed LRRP Clearance Rule

This section presents the total costs of the proposed LRRP Clearance Rule. Total costs are presented for

the first and second years of regulation, and total 50-year and annualized costs are also calculated. The

total costs are calculated over a 50-year period using both 3 and 7 percent discount rates. Discounting

refers to the economic conversion of future costs (and benefits) to their present values, accounting for the

fact that society tends to value future costs or benefits less than comparable near-term costs or benefits.

Discounting is important when the values of costs or benefits occur over a multiple year period and may

vary from year to year. Discounting enables the accumulation of the cost and benefit values from

multiple years at a single point in time, accounting for the difference in how society values those costs

and benefits depending on the year in which the values are estimated to occur.

The 50-year costs were estimated by developing a profile of the compliance costs associated with each

option over a 50-year period. (The 50-year period was chosen to be consistent with the economic analysis

done for the TSCA Section 403 Lead-Based Paint Hazard Standards.) The profile of costs over time was

developed by estimating an annual decline in pre-1978 housing stock of 0.41 percent per-year and

assuming that the regulated universe would decrease by that rate every year. That rate was calculated

using the average annual compound rate of change in the pre-1980 housing stock using data from the

1990 and 2000 Decennial Census (U.S. Census Bureau 1990 and 2000c). This rate affects costs because

it decreases the number of events and number of workers trained every year.

As discussed above, first year dust sampling technician training costs account for the training and

certification of all dust sampling technicians required to meet the demand for dust wipe testing and

clearance services in the first year. In subsequent years, it is assumed that one fifth of the necessary stock

of individuals will obtain training each year (since refresher-training and re-certification is required every

five years).

The total 50-year costs and the 50-year annualized costs are discounted using rates of 3 and 7 percent.

These discount rate values reflect guidance from the Office of Management and Budget regulatory

analysis guidance document, Circular A-4 (OMB, 2003).

The following formula was used to calculate the present value (PV) of the time stream of costs:

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PV = ( 1)

,

(1 )





t

x t

r

Cost

where:

Costt = Costs in year t;

r = Discount rate (3 percent and 7 percent); and

t = Year in which cost is incurred.

This analysis also presents the 50-year annualized costs of the rule. Conceptually, the 50-year annualized

cost is the level annual payment that one would have to make to pay off a debt equal to the present value

total 50-year cost for a given interest rate (the discount rate).

The following formula is used to calculate the 50-year annualized cost.

(1 ) 1

(1 )

(50)

50

 

 

 

r

r r

AC PVr

where:

AC = Annualized 50-Year Costs;

PVr = Present Value Total 50-Year Costs assuming a discount rate of r; and

r = Discount rate (3 percent and 7 percent)

Table 4-60 presents the first year, second year, total 50-year and 50-year annualized incremental costs of

the proposed LRRP Clearance Rule. Total work practice costs are lower for the options with larger size

thresholds for triggering the rule’s requirements. As shown in the table, training costs are not assumed to

vary with the size thresholds. However, it should be noted that it is possible that fewer sampling

technicians may seek training if the universe of events changes, in which case the difference in costs

between threshold options would be larger than estimated for this analysis.

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Table 4-60: Total Incremental Costs of Proposed LRRP Clearance Rule (millions 2008$)

Option Year 1 Year 2 50-Year Total

Annualized

Total

Work

Practice

Costs

Training

Costs Total

Work

Practice

Costs

Training

Costs Total 3% 7% 3% 7%

Target Housing

Low Threshold $295 $139 $434 $294 $26 $320 $8,023 $4,629 $312 $335

Proposed Threshold $253 $139 $392 $252 $26 $278 $6,983 $4,035 $271 $292

High Threshold $203 $139 $342 $202 $26 $228 $5,753 $3,332 $224 $241

Public and Commercial Building COFs

All Thresholds1

$1 -- $1 $1 -- $1 $17 $9 $1 $1

All Structure Types

Low Threshold $296 $139 $435 $295 $26 $321 $8,040 $4,638 $312 $336

Proposed Threshold $254 $139 $393 $253 $26 $279 $6,999 $4,044 $272 $293

High Threshold $204 $139 $343 $203 $26 $229 $5,769 $3,342 $224 $242

1

It is assumed that the number of events in Public and Commercial COFs are not affected by the size thresholds, since the larger scale

of the activities that are expected to occur in these structures are assumed to exceed all size thresholds.

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Table 4-61 presents more detail on which types of events drive the total incremental work practice costs

of the rule. The table demonstrates that despite the relatively higher costs of clearance, dust wipe testing

accounts for the substantial majority of the total work practice costs because of the higher frequency with

which it is required.

The largest contributor to total work practice costs under the low and the proposed threshold options is

from dust wipe testing multiple activity events, which represent the dust wipe testing events that trigger

more than one of the rule’s threshold requirements. These event types represent a smaller share of the

total costs for the larger size threshold options, since fewer renovation activities trigger the rule’s

requirements as the size threshold increases. For example, dust wipe testing for an event where a door

and 10 square feet of trim was removed would be considered a multiple activity event under the low

threshold option (since the trim removal and door removal both trigger the dust wipe testing

requirements). However, this would be categorized as a door removal event under the proposed option

(since the door removal is the only activity that triggers the rule’s requirements under the proposed

option). This example also illustrates why total window/door frame removal event costs are higher for

the higher threshold options even though the size thresholds for these activities do not vary by option.

Table 4-61: Total Incremental Annualized Work Practice Costs by Event Type (3 percent discount

rate, thousands 2008$)

Event Type Low Threshold Proposed Threshold High Threshold

Target

Housing

Public

and Com.

COF Total

Target

Housing

Public

and Com.

COF Total

Target

Housing

Public

and Com.

COF Total

Dust Wipe Testing Events

Heat gun, < 1000

degrees $481 $1 $481 $501 $1 $502 $0 $1 $1

Window/door

frame removal $70,096 $278 $70,374 $74,407 $278 $74,686 $78,926 $278 $79,204

Scraping $5,287 $37 $5,324 $276 $37 $313 $0 $37 $37

Trim, molding,

cabinet removal $93,051 $74 $93,125 $58,866 $74 $58,940 $28,238 $74 $28,312

Multiple activity

eventsa

$99,036 - $99,036 $93,575 - $93,575 $74,898 - $74,898

Subtotal, dust wipe

testing $267,949 $390 $268,340 $227,625 $390 $228,015 $182,062 $390 $182,452

Clearance Events

High speed

machines $650 $200 $850 $678 $200 $878 $361 $200 $561

Plaster demolition

through destructive

means $3,474 $54 $3,528 $4,924 $54 $4,978 $5,459 $54 $5,512

Multiple activity

eventsa

$10,191 - $10,191 $8,603 - $8,603 $6,132 - $6,132

Subtotal, clearance

events $14,315 $254 $14,569 $14,205 $254 $14,459 $11,952 $254 $12,205

Total, All Event

Types $282,265 $644 $282,909 $241,830 $644 $242,474 $194,013 $644 $194,658

a Multiple event types occurring during the course of a single job (e.g., a renovation with both window frame removal

and trim removal).

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4.7 Alternative Baseline and Options

4.7.1 2008 LRRP Rule Universe (Excludes Opt-Out Eligible Housing)

This section presents the costs for the alternative baseline scenario where the opt-out provision is not

eliminated as proposed in October 2009 (74 FR 55506). The primary cost estimates for the Proposed

LRRP Clearance Rule were estimated under a baseline scenario where the opt-out provision of the 2008

LRRP rule has been eliminated. However, because the proposed LRRP Clearance Rule was developed

before the LRRP Opt-Out Rule was finalized, the costs of the Proposed LRRP Clearance Rule are also

estimated for the alternative baseline scenario where the opt-out provision has not been eliminated.

Under this alternative baseline it is estimated that there would be fewer affected events and fewer

sampling technicians seeking training because opt-out eligible housing units would be able to opt-out of

the requirements of the LRRP program, including the proposed LRRP Clearance Rule. Opt-out eligible

housing includes owner-occupied housing units that are not COFs where no child under the age of six or

pregnant woman resides.

Table 4-62 presents the total estimated number of events and target housing work practice costs under this

alternative baseline scenario. The estimated number of events is 1,032,606 under this scenario compared

to 1,595,856 under the primary baseline scenario and the total target housing work practice costs are $165

million under this scenario compared to $254 million under the primary baseline scenario (See Table 4-62

and Table 4-51). The public and commercial building COF universe and costs are the same under both

scenarios.

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Table 4-62: Total First Year Target Housing Costs: 2008 Rule Universe (Excludes Opt-Out

Housing)

Events (thousands) Unit Costs Total Costs (thousands) Type SF-O MF-O SF-R MF-R SF-O MF-O SF-R MF-R SF-O MF-O SF-R MF-R Total

Dust Wipe Testing Events Excluding Kitchen or Bathroom

Bath 3 0 11 10 $121 $121 $127 $127 $0.4 $0.0 $1 3 $1.3 $3 1

Kit 19 1 35 32 $121 $121 $127 $127 $2 3 $0.1 $4.4 $4.0 $10.8

Bath+Kit 0 0 0 0 $186 $186 $191 $191 $0.0 $0.0 $0.0 $0.0 $0.0

S-Paint 7 0 19 30 $121 $121 $127 $127 $0 9 $0.0 $2 5 $3.8 $7 2

M-Paint 4 0 11 19 $139 $121 $131 $127 $0 5 $0.0 $1.4 $2.4 $4.4

L-Paint 3 0 10 18 $191 $147 $170 $152 $0.6 $0.0 $1.8 $2.8 $5 2

S-WD 18 1 34 31 $121 $121 $127 $127 $2 1 $0.1 $4 3 $4.0 $10.6

L-WD 18 1 35 32 $227 $159 $204 $164 $4 2 $0.1 $7 1 $5.3 $16.7

Subtotal 72 4 155 173 - - - - $11.0 $0.5 $22.9 $23.6 $57.9

Dust Wipe Testing Events Including Kitchens or Bathrooms

Bath 9 0 80 48 $143 $143 $148 $148 $1 3 $0.0 $11.9 $7.1 $20.3

Kit 20 0 124 133 $143 $143 $148 $148 $2.8 $0.1 $18.3 $19.6 $40.9

Bath+Kit 8 1 87 31 $217 $217 $223 $223 $1.8 $0.2 $19.4 $6.9 $28.4

S-Paint 1 0 5 3 $143 $143 $148 $148 $0 1 $0.0 $0.7 $0.4 $1 2

M-Paint 1 0 3 4 $155 $136 $147 $142 $0 1 $0.0 $0.4 $0.6 $1 2

L-Paint 0 0 4 1 $204 $158 $184 $164 $0 1 $0.0 $0.7 $0.2 $1 1

S-WD 1 0 3 0 $143 $148 $0 1 $0.0 $0.4 $0.0 $0 5

L-WD 3 0 7 4 $239 $169 $215 $175 $0.7 $0.0 $1.6 $0.6 $3.0

Subtotal 43 2 313 224 - - - - $7.1 $0.4 $53.5 $35.5 $96.4

Clearance Events Excluding Kitchen or Bathroom

Bath 2 0 5 5 $161 $161 $166 $166 $0 2 $0.0 $0 9 $0.8 $2.0

Kit 0 0 0 0 $163 $161 $168 $167 $0 1 $0.0 $0.0 $0.0 $0 2

Bath+Kit 0 0 0 0 $259 $257 $263 $262 $0.0 $0.0 $0.0 $0.0 $0 1

S-Paint 0 0 1 1 $162 $161 $167 $167 $0.0 $0.0 $0 1 $0.1 $0 3

M-Paint 0 0 0 0 $191 $163 $175 $168 $0.0 $0.0 $0.0 $0.1 $0 1

L-Paint 0 0 0 0 $271 $203 $237 $208 $0.0 $0.0 $0 1 $0.1 $0 2

S-WD 0 0 0 0 $161 $166 $0.0 $0.0 $0.0 $0.0 $0.0

L-WD 0 0 0 0 $325 $221 $288 $227 $0.0 $0.0 $0.0 $0.0 $0 1

Subtotal 3 0 7 7 - - - - $0.5 $0.0 $1.2 $1.2 $2.8

Clearance Events Including Kitchens or Bathrooms

Bath 1 0 5 3 $199 $199 $215 $215 $0 1 $0.0 $1 2 $0.7 $2.0

Kit 1 0 5 5 $203 $200 $218 $216 $0 2 $0.0 $1.0 $1.0 $2 2

Bath+Kit 1 0 6 2 $313 $310 $328 $327 $0 2 $0.0 $2.0 $0.7 $2 9

S-Paint 0 0 0 0 $201 $200 $217 $216 $0.0 $0.0 $0 1 $0.0 $0 1

M-Paint 0 0 0 0 $226 $194 $219 $211 $0.0 $0.0 $0.0 $0.0 $0 1

L-Paint 0 0 0 0 $302 $230 $278 $246 $0.0 $0.0 $0 1 $0.0 $0 1

S-WD 0 0 0 0 $199 $215 $0.0 $0.0 $0.0 $0.0 $0.0

L-WD 0 0 0 0 $354 $248 $327 $264 $0 1 $0.0 $0 1 $0.0 $0 3

Subtotal 2 0 17 11 - - - - $0.6 $0.0 $4.5 $2.5 $7.7

All Events

Total 120 6 493 414 - - - - $19.1 $0.9 $82.0 $62.8 $164.8

The following abbreviations are used: SF-O indicates single-family owner-occupied; MF-O indicates multi-family owner-occupied; SFR indicates single-family renter-occupied; MF-R indicates multi-family renter-occupied; Bath indicates a bathroom size event; Kit

indicates a kitchen size event, Bath+Kit indicates an event the size of a bathroom and a kitchen combined; S-Paint indicates a small

painting sized event; M-Paint indicates a small painting sized event; L-Paint indicates a small painting sized event; S-WD indicates a

small window/door sized event; L-WD indicates a large window/door sized event A “bathroom size” or kitchen size” indicates the

event size, not the event type In addition to bathroom and kitchen events, other event types having these size definitions are: (1)

Bathroom size: wall-disturbing events, addition events, (2) Kitchen size: wall-disturbing events, addition events, window/door

replacements, (3) Bathroom + kitchen size: wall-disturbing events, addition events A zero indicates a small positive number rounded to

zero in the table Events excluding kitchens or bathrooms are calculated separately from events including kitchens and bathrooms,

because kitchens and bathrooms have a different probability of being carpeted than the rest of the house, and dust wipe samples are

only taken on uncarpeted floors Clearance costs include the cost of associated dust wipe testing

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Table 4-63 presents the estimated number of sampling technicians trained under the alternative baseline

scenario where the opt-out provision is not eliminated. The estimated number of sampling technicians

trained in the first year is 136,714 under this scenario compared to 233,821 under the primary baseline

scenario and the total first year training costs are $85 million under this scenario compared to $139

million under the primary baseline scenario (See Table 4-63 and Table 4-59).

Table 4-63: Total Dust Sampling Technician Training Costs:

2008 Rule Universe (Excludes Opt-Out Housing - 2008$)

Year Type of

Training

Number of Dust

Sampling

Technicians

Seeking Training

Average Cost of

Training

Total Training

Cost (2008$,

before

discounting)

Year 1 Initial 136,714 $621 $84,899,362

Year 2 Initial 23,600 $621 $14,655,554

Refresher 3,631 $378 $1,372,426

Table 4-64 presents a comparison of the costs of the LRRP Clearance Proposed Rule for both the primary

baseline scenario and the alternative baseline scenario where the opt-out provision is not eliminated as

was proposed in October 2009. Under this alternative baseline it is estimated that there would be fewer

affected events and fewer sampling technicians seeking training, and Table 4-64 shows how much lower

these costs would be under this alternative baseline scenario.

Table 4-64: Total Incremental Costs of Clearance Rule (millions 2008$)

Option Year 1 Year 2 50-Year Total

Annualized

Total

Work

Practice

Costs

Training

Costs Total

Work

Practice

Costs

Training

Costs Total 3% 7% 3% 7%

Primary Baseline

Scenario: Universe

includes Opt-Out

$254 $139 $393 $253 $26 $279 $6,999 $4,044 $272 $293

Alternative Baseline

Scenario: 2008 Rule

Universe (Excludes

Opt-Out)

$166 $85 $250 $165 $16 $181 $4,535 $2,619 $176 $190

Percentage

Difference -35% -39% -36% -35% -39% -35% -35% -35% -35% -35%

4.7.2 Mandatory Third Party Third Party Dust Wipe Sampling Option

This section presents the estimated costs under an alternative option where dust wipe sampling must be

performed by a third party. Other requirements are the same as under the proposed option.

Table 4-65 presents the total estimated number of events and target housing work practice costs under this

alternative option. The estimated number of events is the same under this scenario compared to the

primary option and the total target housing work practice costs are $450 million under this scenario

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compared to $254 million under the primary option (See Table 4-65 and Table 4-51). The public and

commercial building COF universe and costs are the same under both scenarios.

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Table 4-65: Total First Year Target Housing Event Costs: Third Party Dust Sampling Option

Events (thousands) Unit Costs Total Costs (thousands) Type SF-O MF-O SF-R MF-R SF-O MF-O SF-R MF-R SF-O MF-O SF-R MF-R Total

Dust Wipe Testing Events Excluding Kitchen or Bathroom

Bath 17 1 11 10 $243 $243 $248 $248 $4.2 $0.2 $2.6 $2.6 $9.6

Kit 104 6 35 32 $243 $243 $248 $248 $25.4 $1.4 $8.6 $7.9 $43.4

Bath+Kit 1 0 0 0 $308 $308 $313 $313 $0.2 $0.0 $0.0 $0.0 $0.2

S-Paint 42 2 19 30 $243 $243 $248 $248 $10.1 $0.6 $4.8 $7.5 $23.0

M-Paint 22 1 11 19 $261 $243 $252 $248 $5.6 $0.3 $2.8 $4.7 $13.4

L-Paint 20 1 10 18 $313 $269 $292 $274 $6.3 $0.3 $3.1 $5.0 $14.7

S-WD 101 6 34 31 $243 $243 $248 $248 $24.4 $1.4 $8.5 $7.8 $42.1

L-WD 104 6 35 32 $349 $281 $326 $286 $36.4 $1.7 $11.3 $9.2 $58.5

Subtotal 410 23 155 173 - - - - $112.6 $5.9 $41.8 $44.6 $204.9

Dust Wipe Testing Events Including Kitchens or Bathrooms

Bath 52 2 80 48 $265 $265 $270 $270 $13.8 $0.6 $21.7 $12.9 $49.1

Kit 102 6 124 133 $265 $265 $270 $270 $27.0 $1.6 $33.4 $35.8 $97.8

Bath+Kit 35 5 87 31 $340 $340 $345 $345 $11.9 $1.5 $30.0 $10.7 $54.1

S-Paint 4 0 5 3 $265 $265 $270 $270 $1.0 $0.0 $1.3 $0.8 $3.1

M-Paint 4 0 3 4 $277 $258 $268 $264 $1.2 $0.1 $0.8 $1.2 $3.2

L-Paint 2 0 4 1 $326 $280 $306 $286 $0.6 $0.1 $1.2 $0.4 $2.2

S-WD 3 0 3 0 $265 $270 $0.9 $0.0 $0.7 $0.0 $1.5

L-WD 13 1 7 4 $361 $291 $338 $297 $4.6 $0.2 $2.5 $1.1 $8.3

Subtotal 215 14 313 224 - - - - $60.8 $4.1 $91.7 $62.8 $219.4

Clearance Events Excluding Kitchen or Bathroom

Bath 8 0 5 5 $325 $325 $331 $331 $2.6 $0.1 $1.7 $1.6 $6.2

Kit 2 0 0 0 $328 $326 $332 $331 $0.6 $0.0 $0.1 $0.1 $0.8

Bath+Kit 0 0 0 0 $454 $453 $459 $458 $0.1 $0.0 $0.0 $0.0 $0.2

S-Paint 1 0 1 1 $326 $326 $332 $331 $0.4 $0.0 $0.2 $0.3 $0.9

M-Paint 0 0 0 0 $364 $328 $342 $333 $0.2 $0.0 $0.1 $0.1 $0.4

L-Paint 0 0 0 0 $469 $380 $423 $386 $0.2 $0.0 $0.1 $0.1 $0.4

S-WD 0 0 0 0 $326 $331 $0.1 $0.0 $0.0 $0.0 $0.1

L-WD 1 0 0 0 $535 $404 $489 $410 $0.3 $0.0 $0.1 $0.0 $0.4

Subtotal 13 1 7 7 - - - - $4.6 $0.2 $2.3 $2.3 $9.4

Clearance Events Including Kitchens or Bathrooms

Bath 4 0 5 3 $359 $359 $364 $364 $1.3 $0.1 $2.0 $1.1 $4.4

Kit 4 0 5 5 $363 $360 $367 $365 $1.6 $0.1 $1.7 $1.7 $5.1

Bath+Kit 3 0 6 2 $507 $504 $512 $510 $1.3 $0.2 $3.1 $1.0 $5.6

S-Paint 0 0 0 0 $361 $360 $366 $365 $0.1 $0.0 $0.1 $0.1 $0.2

M-Paint 0 0 0 0 $393 $353 $369 $358 $0.1 $0.0 $0.1 $0.1 $0.2

L-Paint 0 0 0 0 $493 $400 $446 $405 $0.1 $0.0 $0.1 $0.0 $0.3

S-WD 0 0 0 0 $359 $365 $0.1 $0.0 $0.1 $0.0 $0.1

L-WD 1 0 0 0 $557 $423 $509 $428 $0.4 $0.0 $0.2 $0.1 $0.7

Subtotal 12 1 17 11 - - - - $4.9 $0.3 $7.3 $4.2 $16.8

All Events

Total 650 39 493 414 - - - - $182.9 $10.5 $143.1 $113.9 $450.4

The following abbreviations are used: SF-O indicates single-family owner-occupied; MF-O indicates multi-family owneroccupied; SF-R indicates single-family renter-occupied; MF-R indicates multi-family renter-occupied; Bath indicates a

bathroom size event; Kit indicates a kitchen size event, Bath+Kit indicates an event the size of a bathroom and a kitchen

combined; S-Paint indicates a small painting sized event; M-Paint indicates a small painting sized event; L-Paint indicates a

small painting sized event; S-WD indicates a small window/door sized event; L-WD indicates a large window/door sized

event A “bathroom size” or kitchen size” indicates the event size, not the event type In addition to bathroom and kitchen

events, other event types having these size definitions are: (1) Bathroom size: wall-disturbing events, addition events, (2)

Kitchen size: wall-disturbing events, addition events, window/door replacements, (3) Bathroom + kitchen size: wall-disturbing

events, addition events A zero indicates a small positive number rounded to zero in the table Events excluding kitchens or

bathrooms are calculated separately from events including kitchens and bathrooms, because kitchens and bathrooms have a

different probability of being carpeted than the rest of the house, and dust wipe samples are only taken on uncarpeted floors

Clearance costs include the cost of associated dust wipe testing

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Because this option assumes that all dust wipe testing and clearance events will be performed by third

party firms, the costs associated with dust sampling technicians are implicitly included in the additional

costs associated with third party testing.

Table 4-66 presents a comparison of the costs of the LRRP Clearance Proposed Rule for both the primary

option and the alternative option where all dust sampling following target housing events is performed by

third party establishments instead of residential RRP firms. Under this alternative option it is estimated

that there would be the same number of affected events and higher overall costs.

Table 4-66: Total Incremental Costs of Clearance Rule (2008$): Mandatory Third Party Dust Sampling Option

Option Year 1 Year 2 50-Year Total

Annualized

Total

Work

Practice

Costs

Training

Costs Total

Work

Practice

Costs

Training

Costs Total 3% 7% 3% 7%

Proposed Rule:

In-house Dust Wipe

Sampling Allowed

$254 $139 $393 $253 $26 $279 $6,999 $4,044 $272 $293

Alternative Option:

Mandatory Third

Party Dust Wipe

Sampling

$451 $451 $449 $449 $11,095 $6,334 $431 $459

Percentage

Difference n.a. 15% n.a. 61% 59% 57% 59% 57%

4.7.3 Dust Wipe Testing Only Option

This section presents the estimated costs under an alternative option where only dust wipe testing is

required in all instances where either dust wipe testing or clearance is required under the proposed rule

(i.e., clearance is not required for any RRP events).

Table 4-67 presents the total estimated number of events and target housing work practice costs under this

alternative option. The estimated number of events is the same under the dust wipe testing option

compared to the primary option, although all events previously requiring clearance will now only require

dust wipe testing. The total target housing work practice costs are $249 million under this scenario

compared to $254 million under the primary option (See Table 4-67 and Table 4-51). The public and

commercial building COF universe and costs under the alternative option are presented in Table 4-68.

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Table 4-67: Total First Year Target Housing Costs: Dust Wipe Testing Option

Events (thousands) Unit Costs Total Costs (millions) Type SF-O MF-O SF-R MF-R SF-O MF-O SF-R MF-R SF-O MF-O SF-R MF-R Total

Events Excluding Kitchen or Bathroom

Bath 25 1 16 15 $121 $121 $127 $127 $3.1 $0.2 $2.0 $1.9 $7.2

Kit 106 6 35 32 $121 $121 $127 $127 $12.9 $0.7 $4.4 $4.1 $22.1

Bath+Kit 1 0 0 0 $186 $186 $191 $191 $0.2 $0.0 $0.0 $0.0 $0.2

S-Paint 43 2 20 31 $121 $121 $127 $127 $5.2 $0.3 $2.5 $3.9 $11.9

M-Paint 22 1 11 19 $139 $121 $131 $127 $3.1 $0.2 $1.5 $2.5 $7.2

L-Paint 21 1 11 19 $191 $147 $170 $152 $3.9 $0.2 $1.8 $2.8 $8.8

S-WD 101 6 34 31 $121 $121 $127 $127 $12.2 $0.7 $4.4 $4.0 $21.3

L-WD 105 6 35 32 $227 $159 $204 $164 $23.8 $1.0 $7.1 $5.3 $37.1

Subtotal 424 24 162 180 -- -- -- -- $64.4 $3.1 $23.8 $24.5 $115.7

Events Including Kitchens or Bathrooms

Bath 56 2 86 51 $143 $143 $148 $148 $8.0 $0.3 $12.7 $7.5 $28.6

Kit 106 6 128 137 $143 $143 $148 $148 $15.2 $0.9 $19.0 $20.3 $55.4

Bath+Kit 38 5 93 33 $217 $217 $223 $223 $8.2 $1.1 $20.7 $7.4 $37.3

S-Paint 4 0 5 3 $143 $143 $148 $148 $0.5 $0.0 $0.7 $0.4 $1.8

M-Paint 4 0 3 5 $155 $136 $147 $142 $0.7 $0.0 $0.5 $0.7 $1.8

L-Paint 2 0 4 1 $204 $158 $184 $164 $0.4 $0.0 $0.8 $0.2 $1.5

S-WD 3 0 3 0 $143 $0 $148 $0 $0.5 $0.0 $0.4 $0.0 $0.9

L-WD 13 1 8 4 $239 $169 $215 $175 $3.2 $0.1 $1.7 $0.7 $5.7

Subtotal 227 15 331 234 -- -- -- -- $36.6 $2.5 $56.6 $37.3 $132.9

All Events

Total 650 39 493 414 -- -- -- -- $101.0 $5.6 $80.3 $61.7 $248.7

The following abbreviations are used: SF-O indicates single-family owner-occupied; MF-O indicates multi-family owneroccupied; SF-R indicates single-family renter-occupied; MF-R indicates multi-family renter-occupied; Bath indicates a

bathroom size event; Kit indicates a kitchen size event, Bath+Kit indicates an event the size of a bathroom and a kitchen

combined; S-Paint indicates a small painting sized event; M-Paint indicates a small painting sized event; L-Paint indicates a

small painting sized event; S-WD indicates a small window/door sized event; L-WD indicates a large window/door sized

event A “bathroom size” or kitchen size” indicates the event size, not the event type In addition to bathroom and kitchen

events, other event types having these size definitions are: (1) Bathroom size: wall-disturbing events, addition events, (2)

Kitchen size: wall-disturbing events, addition events, window/door replacements, (3) Bathroom + kitchen size: wall-disturbing

events, addition events A zero indicates a small positive number rounded to zero in the table Events excluding kitchens or

bathrooms are calculated separately from events including kitchens and bathrooms, because kitchens and bathrooms have a

different probability of being carpeted than the rest of the house, and dust wipe samples are only taken on uncarpeted floors

Clearance costs include the cost of associated dust wipe testing

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Table 4-68: Total First Year Public and Commercial Building COF Costs:

Dust Wipe Testing Option

Building Type Events Unit Costs Total Costs

Kindergarten (Public) 192 $465 $89,531

Kindergarten (Large Private) 27 $465 $12,775

Kindergarten (Small Private) 32 $465 $15,096

Pre-K + Kindergarten (Public) 150 $465 $69,908

Pre-K + Kindergarten (Large Private) 82 $465 $38,195

Pre-K + Kindergarten (Small Private) 41 $465 $19,259

Daycare Center (Renter-Occupied) 208 $416 $86,526

Daycare Center (Owner-Occupied) 142 $416 $59,310

Daycare Center (Non-Profit who

performs some of own RRP) 181 $416 $75,398

Daycare Center (Non-Profit who uses

contractors) 67 $416 $27,749

Daycare Center (In Public School) 10 $416 $3,968

Daycare Center (In Large Private

School) 0 $416 $20

Daycare Center (In Small Private

School) 0 $416 $39

All Building Types 1134 -- $497,774

a. These unit costs for events in public and commercial building COFs are third party costs

since the analysis assumes that non-residential contractors and operators of public and

commercial building COFs will not perform enough dust wipe testing events annually to make

training an in-house dust sampling technician worthwhile.

Because under this option all residential construction establishments will still be expected to train an inhouse dust sampling technician, total training costs will be the same under both the primary option and

alternative option. Therefore – as under the primary option – the estimated number of sampling

technicians trained in the first year will be 233,821 and training costs will amount to $139 million.

Table 4-69 presents a comparison of the costs of the LRRP Clearance Proposed Rule for both the primary

option and the alternative option under which all events affected by the rule would only require dust wipe

testing. Under this alternative option it is estimated that there would be the same total number of affected

events, the same total number of sampling technicians and training costs, and lower average per-event

costs.

Table 4-69: Total Incremental Costs of Dust Wipe Testing Only Option (million $)

Option Year 1 Year 2 50-Year Total

Annualized

Total

Work

Practice

Costs

Training

Costs Total

Work

Practice

Costs

Training

Costs Total 3% 7% 3% 7%

Proposed Rule:

Dust Wipe Testing

and Clearance

$254 $139 $393 $253 $26 $279 $6,999 $4,044 $272 $293

Alternative Option:

Dust Wipe Testing

Only

$249 $139 $388 $248 $26 $274 $6,888 $3,981 $268 $288

Percentage

Difference -2% 0% -1% -2% 0% -2% -2% -2% -2% -2%

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4.7.4 Clearance for All Events Option

This section presents the estimated costs under an alternative option where clearance is required in all

instances where either dust wipe testing or clearance is required under the proposed rule.

Table 4-70 presents the total estimated number of events and target housing work practice costs under this

alternative option. The estimated number of events is the same under this scenario compared to the

primary option, although all events previously only requiring dust wipe testing will now require achieving

clearance. The total target housing event costs are $351 million under this scenario compared to $254

million under the primary option (See Table 4-70 and Table 4-51). Public and commercial building COF

universe and costs under the alternative option are presented in Table 4-71.

Table 4-70: Total First Year Target Housing Costs: Clearance Option

Events (thousands) Unit Costs Total Costs (thousands) Type SF-O MF-O SF-R MF-R SF-O MF-O SF-R MF-R SF-O MF-O SF-R MF-R Total

Events Excluding Kitchen or Bathroom

Bath 25 1 16 15 $161 $161 $166 $166 $4.1 $0.2 $2.6 $2.6 $9.5

Kit 106 6 35 32 $163 $161 $168 $167 $17.3 $1.0 $5.9 $5.3 $29.5

Bath+Kit 1 0 0 0 $259 $257 $263 $262 $0.2 $0.0 $0.0 $0.0 $0.3

S-Paint 43 2 20 31 $162 $161 $167 $167 $6.9 $0.4 $3.3 $5.1 $15.8

M-Paint 22 1 11 19 $191 $163 $175 $168 $4.2 $0.2 $2.0 $3.3 $9.7

L-Paint 21 1 11 19 $271 $203 $237 $208 $5.6 $0.2 $2.5 $3.9 $12.2

S-WD 101 6 34 31 $161 $161 $166 $166 $16.2 $0.9 $5.7 $5.2 $28.1

L-WD 105 6 35 32 $325 $221 $288 $227 $34.0 $1.3 $10.1 $7.3 $52.7

Subtotal 424 24 162 180 -- -- -- -- $88.6 $4.2 $32.1 $32.7 $157.7

Events Including Kitchens or Bathrooms

Bath 56 2 86 51 $199 $199 $215 $215 $11.1 $0.5 $18.5 $11.0 $41.0

Kit 106 6 128 137 $203 $200 $218 $216 $21.6 $1.3 $28.0 $29.7 $80.5

Bath+Kit 38 5 93 33 $313 $310 $328 $327 $11.8 $1.5 $30.6 $10.8 $54.6

S-Paint 4 0 5 3 $201 $200 $217 $216 $0.8 $0.0 $1.1 $0.7 $2.5

M-Paint 4 0 3 5 $226 $194 $219 $211 $1.0 $0.0 $0.7 $1.0 $2.7

L-Paint 2 0 4 1 $302 $230 $278 $246 $0.6 $0.0 $1.2 $0.4 $2.2

S-WD 3 0 3 0 $199 $215 $0.7 $0.0 $0.6 $0.0 $1.3

L-WD 13 1 8 4 $354 $248 $327 $264 $4.7 $0.2 $2.6 $1.0 $8.5

Subtotal 227 15 331 234 -- -- -- -- $52.2 $3.5 $83.1 $54.5 $193.4

All Events

Total 650 39 493 414 -- -- -- -- $140.8 $7.8 $115.3 $87.2 $351.1

The following abbreviations are used: SF-O indicates single-family owner-occupied; MF-O indicates multi-family owneroccupied; SF-R indicates single-family renter-occupied; MF-R indicates multi-family renter-occupied; Bath indicates a

bathroom size event; Kit indicates a kitchen size event, Bath+Kit indicates an event the size of a bathroom and a kitchen

combined; S-Paint indicates a small painting sized event; M-Paint indicates a small painting sized event; L-Paint indicates a

small painting sized event; S-WD indicates a small window/door sized event; L-WD indicates a large window/door sized

event A “bathroom size” or kitchen size” indicates the event size, not the event type In addition to bathroom and kitchen

events, other event types having these size definitions are: (1) Bathroom size: wall-disturbing events, addition events, (2)

Kitchen size: wall-disturbing events, addition events, window/door replacements, (3) Bathroom + kitchen size: wall-disturbing

events, addition events A zero indicates a small positive number rounded to zero in the table Events excluding kitchens or

bathrooms are calculated separately from events including kitchens and bathrooms, because kitchens and bathrooms have a

different probability of being carpeted than the rest of the house, and dust wipe samples are only taken on uncarpeted floors

Clearance costs include the cost of associated dust wipe testing

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Table 4-71: Total First Year Public and Commercial Building COF Costs:

Clearance Option

Building Type Events Unit Costs Total Costs

Kindergarten (Public) 192 $1,876 $360,887

Kindergarten (Large Private) 27 $1,876 $51,496

Kindergarten (Small Private) 32 $1,876 $60,849

Pre-K + Kindergarten (Public) 150 $2,147 $322,609

Pre-K + Kindergarten (Large Private) 82 $2,147 $176,259

Pre-K + Kindergarten (Small Private) 41 $2,147 $88,878

Daycare Center (Renter-Occupied) 208 $688 $143,119

Daycare Center (Owner-Occupied) 142 $688 $98,102

Daycare Center (Non-Profit who

performs some of own RRP) 181 $688 $124,713

Daycare Center (Non-Profit who uses

contractors) 67 $688 $45,898

Daycare Center (In Public School) 10 $688 $6,564

Daycare Center (In Large Private

School) 0 $688 $32

Daycare Center (In Small Private

School) 0 $688 $65

All Building Types 1134 -- $1,479,470

a. These unit costs for events in public and commercial building COFs are third party costs

since the analysis assumes that non-residential contractors and operators of public and

commercial building COFs will not perform enough dust wipe testing events annually to make

training an in-house dust sampling technician worthwhile.

Because under this option all residential construction establishments will still be expected to train only

one in-house dust sampling technician, total training costs will be the same under both the primary option

and alternative option. Therefore – as under the primary option – the estimated number of sampling

technicians trained in the first year will be 233,821, and training costs will amount to $139 million.

Table 4-72 presents a comparison of the costs of the LRRP Clearance Proposed Rule for both the primary

option and the alternative option under which all events affected by the rule would require full clearance.

Under this alternative option it is estimated that there would be the same total number of affected events,

the same number of sampling technicians seeking training and total training costs, and higher average perevent costs.

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Table 4-72: Total Incremental Costs of Clearance for All Events Option ($ million)

Option Year 1 Year 2 50-Year Total

Annualized

Total

Work

Practice

Costs

Training

Costs Total

Work

Practice

Costs

Training

Costs Total 3% 7% 3% 7%

Proposed Rule:

Dust Wipe Testing

and Clearance

$254 $139 $393 $253 $26 $279 $6,999 $4,044 $272 $293

Alternative Option:

Clearance for all

Events in Proposed

Rule

$353 $139 $492 $351 $26 $377 $9,431 $5,432 $367 $394

Percentage

Difference 39% 0% 25% 39% 0% 35% 35% 34% 35% 34%

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References

Gilkeya, David; Jacob Hautaluomaa, Taslim Ahmeda, Thomas Keefea, Robert Herrona, Philip Bigelowb.

2003. Construction Work Practices and Conditions Improved After 2-Years’ Participation in the

HomeSafe Pilot Program. American Industrial Hygiene Association Journal, May/June 2003.

FedEx. 2009. “Get Rates and Transit Times.” Available at:

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RS Means, 2005, Means CostWorks Repair & Remodeling Cost Data 2005 CD-ROM, 7th Edition

http://www.rsmeans.com/bookstore/detail.asp?sku=65045

Salesgenie.com. 2009. “Business to Business Directory”. Available at:

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SKC Inc. 2009. “Ghost Wipes, For Surface Lead/Dust Sampling, (200/Pkg).” Available at:

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UPS. 2009. “Zones and Rates.” Available at:

http://www.ups.com/content/us/en/shipping/cost/zones/index html?WT.svl=SubNav (Accessed

10/1/2009).

U.S. Bureau of Labor Statistics. 2005a. Occupational Employment Statistics Series.

U.S. Bureau of Labor Statistics. 2006. "Current Population Survey: Basic Monthly Survey." January

2006.

U.S. Bureau of Labor Statistics. 2008a. Occupational Employment Statistics Series. December 2008.

U.S. Bureau of Labor Statistics. 2008b. Consumer Price Index: All Urban Consumers. December 2008.

U.S. Census Bureau. 1990. "H025. Year Structure Built - Universe: Housing units." American Fact

Finder. Available at: http://factfinder.census.gov/ (Downloaded 10/26/2005)

U.S. Census Bureau. 1995. Property Owners and Managers Survey (POMS)

U.S. Census Bureau. 1997. American Housing Survey (AHS).

U.S. Census Bureau. 2000c. "H34. Year Structure Built [10] - Universe: Housing Units." American Fact

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U.S. Census Bureau. 2003. American Housing Survey (AHS).

U.S. Census Bureau. 2005d. “Sector 23: Industry Series: Value of Construction for Establishments by

Type of Construction: 2002.” American Fact Finder. Available at:

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http://www.census.gov/hhes/www/housing/ahs/overview html.

U.S. Census Bureau. 2005h. Property Owners and Managers Survey (POMS) – Overview. Available at:

http://www.census.gov/hhes/www/housing/poms/overview.html

U.S. Census Bureau. 2006. “American Housing Survey for the U.S. 2005.” Current Housing Reports.

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Chapter 4 4-86

U.S. Department of Energy (DOE). 2003. Commercial Buildings Energy Consumption Survey (CBECS).

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U.S. EPA. 1998. Economic Analysis of Toxic Substances Control Act Section 403: Hazard Standards.

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U.S. EPA. 2008. Lead; Renovation, Repair, and Painting Program; Lead Hazard Information Pamphlet;

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Rule for Target Housing and Child-Occupied Facilities. April 2008.

U.S. EPA 2009a. Lead; Amendment to the Opt-Out and Recordkeeping Provisions in the Renovation,

Repair, and Painting Program. 74 FR 55506, October 28, 2009.

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11th Annual Edition. August 2006.

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Economic Analysis for the LRRP Clearance Proposed Rule

Chapter 5 5-1

5. Benefits of the Proposed LRRP Clearance Rule

A great deal of information on the numerous adverse health effects of lead is available from decades of

medical observation and scientific research. Inhaled or ingested lead is distributed throughout the body

and is toxic to many organ systems. As a result, its toxicity manifests itself in the form of impacts on

several organ systems. A reduction in lead exposure resulting from the proposed rule would lead to a

reduction in these adverse health effects and the costs of treating them. Young children (from birth

through age five) are particularly sensitive to lead, which impairs a child’s neuropsychological

development (frequently measured by IQ change). This chapter presents a discussion of the benefits

associated with reducing lead exposure through revising the lead, renovation, repair, and painting (LRRP)

program regulations, by estimating the numbers of the populations expected to be affected.

The proposed LRRP Clearance Rule would require dust wipe testing after many of the RRP activities

regulated under the 2008 LRRP rule, and would require clearance after a smaller subset of RRP activities.

The clearance requirements of the proposed LRRP Clearance Rule are expected to result in lower

exposures to dust lead by reducing the amount of dust lead left behind after renovation, repair, and

painting (RRP). Two types of benefits are expected to be realized from the proposed dust wipe testing

requirements. The first type is the direct benefits of the information to the owners and occupants, which

includes the value of the information on dust lead levels remaining in the renovation work area. For

building owners and occupants, this information is likely to improve their understanding and awareness of

dust lead hazards. It will also greatly improve their ability to make further risk management decisions.

This information is particularly critical where dust lead levels approach or exceed the regulatory hazard

standards. The second benefit expected to be realized from the proposed dust wipe testing requirements

stems from changed behavior on the part of renovation firms. EPA believes that dust wipe testing results

will also provide valuable feedback to renovation firms on how well they are cleaning up after

renovations. It is likely that the specific dust lead levels contained in dust wipe testing results will

increase renovation firm cleaning efficiency. Renovation firms will be incentivized to lower the dust lead

levels remaining after renovation jobs, even if the levels are at or near the regulatory standards. Because

proper cleanup plays such a vital role in the minimization of dust lead hazards created by renovations,

providing information on dust lead levels remaining after renovations to building owners and occupants

will serve as an incentive for firms to perform post-renovation cleaning efficiently and thoroughly,

reducing the amount of dust lead left behind after RRP.

An overview of the proposed LRRP Clearance Rule, as it applies to this benefits estimation, is provided

in Section 5.1. Section 5.2 presents the estimated number of children, pregnant woman, and adults who

reside in or occupy (i.e., attend school or receive childcare in) the structures affected by the proposed rule.

Finally, in Section 5.3, the human health and ecological consequences of lead exposure are summarized.

This analysis does not quantify the value of the benefits of the proposed rule, but presents estimated

numbers of some of the populations expected to be affected.

5.1 Overview of Proposed LRRP Clearance Rule in Terms of Benefits

Estimation

The proposed LRRP Clearance Rule includes several revisions to the 2008 Lead Renovation, Repair, and

Painting Program (RRP) rule that established accreditation, training, certification, and recordkeeping

requirements as well as work practice standards for persons performing renovations for compensation in

most pre-1978 housing and child-occupied facilities. EPA is particularly concerned about dust lead

hazards generated by renovations because of the well-documented toxicity of lead, especially to younger

children. The proposed LRRP Clearance Rule includes additional requirements designed to ensure that

lead-based paint hazards generated by renovation work are adequately cleaned after renovation work is

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finished and before the areas are re-occupied. Specifically, EPA is proposing to require dust wipe testing

after many renovations covered by the RRP rule. For a subset of jobs involving demolition or removal of

plaster through destructive means or the disturbance of paint using machines designed to remove paint

through high-speed operation, such as power sanders or abrasive blasters, this proposal would also require

the renovation firm to demonstrate, through dust wipe testing, that dust-lead levels remaining in the work

area are below regulatory levels.

With regard to potential implications of lead effects on IQ, the Air Quality Criteria Document recognizes

the ‘‘critical’’ distinction between population and individual risk, identifying issues regarding declines in

IQ for an individual and for the population. The Criteria Document further states that a ‘‘point estimate

indicating a modest mean change on a health index at the individual level can have substantial

implications at the population level’’ (CD, p. 8–77). A downward shift in the mean IQ value is associated

with both substantial decreases in percentages achieving very high scores and substantial increases in the

percentage of individuals achieving very low scores (AQCD, p. 8–81). For an individual functioning in

the low IQ range due to the influence of developmental risk factors other than lead, a lead-associated IQ

decline of several points might be sufficient to drop that individual into the range associated with

increased risk of educational, vocational, and social failure (AQCD, p. 8–77).

Other cognitive effects observed in studies of children have included effects on attention, executive

functions, language, memory, learning and visuospatial processing (AQCD, sections 5.3.5, 6.2.5 and

8.4.2.1), with attention and executive function effects associated with lead exposures indexed by blood

lead levels below 10 μg/dL (AQCD, section 6.2.5 and pp. 8–30 to 8–31). The evidence for the role of lead

in this suite of effects includes experimental animal findings (discussed in AQCD, section 8.4.2.1; p. 8–

31), which provide strong biological plausibility of lead effects on learning ability, memory and attention

(AQCD, section 5.3.5), as well as associated mechanistic findings.

These cognitive and behavioral effects, discussed above, are strongly related to future productivity and

expected earnings (Salkever 1995). Based on Salkever’s coefficients, the estimated value of an IQ point

is $14,280 (2008 dollars). This IQ value is modeled as the present value of a loss in expected lifetime

earnings due to a one point IQ drop. The present value is calculated assuming that children would be

affected by lead at 3 years of age, the median of the range when children are most susceptible to lead

hazards; that while most people start working at age 18, average income in the early adult years is

reduced because some are still in school; and that retirement occurs at the age of 67. This estimated value

of an IQ point is limited to reduced income, and does not include other potential impacts such as

additional education costs for special and remedial education, and medical costs to treat very high levels

of lead.

Both epidemiologic and toxicological studies have shown that environmentally relevant levels of lead

affect many different organ systems (EPA 2006b, p.E-8). It appears that some of these effects,

particularly changes in the levels of certain blood enzymes and in aspects of children's neurobehavioral

development, may occur at blood-lead levels so low as to be essentially without a threshold (EPA 2004).

Epidemiologic studies have consistently demonstrated associations between lead exposure and enhanced

risk of deleterious cardiovascular outcomes, including increased blood pressure and increased

hypertension (EPA 2006b). A meta-analysis of numerous studies estimates that a doubling of blood-lead

level (e.g., from 5 to 10 μg/dL) is associated with ~1.0 millimeter of mercury (mm Hg) increase in

systolic blood pressure and ~0.6 mm Hg increase in diastolic pressure. The evidence for an association of

lead with cardiovascular morbidity and mortality is limited but supportive (EPA 2006b, p. E-10).

The Criteria Document states ‘‘although an increase of a few mmHg in blood pressure might not be of

concern for an individual’s well-being, the same increase in the population mean might be associated with

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substantial increases in the percentages of individuals with values that are sufficiently extreme that they

exceed the criteria used to diagnose hypertension’’ (EPA 2006b, p. 8–77).

Neurotoxic effects in children and cardiovascular effects in adults are among those best substantiated as

occurring at blood-lead concentrations as low as 5 to 10 ug/dL (or possibly lower); and these categories of

effects are currently clearly of greatest public health concern (EPA 2006b, p 8-60). Other newly

demonstrated immune and renal system effects among general population groups are also emerging as

low-level lead exposure effects of potential public health concern (EPA 2006b, p 8-60).

Some studies have examined the question of whether the neurological effects of exposures in early

childhood are ameliorated when blood-lead levels decline. The data are mixed on this issue. In a study

that treated lead-exposed children with a chelating agent, Ruff (1993) found that children whose bloodlead levels had the greatest decline showed the most improvement in cognitive scores. In contrast, Rogan

(2001) found that treatment with a chelating agent lowered blood-lead levels in children but did not

appear to improve neurological function. Liu (2002) also found that chelation therapy at age 2, while

lowering blood-lead levels, did not improve neurological function in children at 5 years of age. While the

study did detect a relationship between declining blood-lead and improved neurological function, this

association was observed only in the untreated group, leading the authors to speculate that some other

factor besides declining lead levels from chelation therapy (such as greater parental involvement), led to

the neurological gains. Dietrich (2004) had similar findings in the same cohort of children at 7 years of

age. One study cited in ATSDR (1999) showed impaired motor and cognitive function at a current mean

level of 2.9 μg/dL, about 20 years after exposure when blood-lead levels were 40-50 μg/dL (Stokes 1998).

The negative impact of lead on IQ and other neurobehavioral outcomes persist in most recent studies

following adjustment for numerous confounding factors including social class, quality of caregiving, and

parental intelligence. Moreover, these effects appear to persist into adolescence and young adulthood in

the absence of marked reductions in environmental exposure to lead (EPA 2006b, p. 6-76). This further

supports the concern that early exposures to lead may lead to irreversible damage and supports the

benefits of regulatory interventions to prevent and/or reduce lead exposure.

Renovation activities that disturb lead-based paint create high dust-lead levels which are not removed

through typical cleaning practices. EPA’s Dust Study (EPA 2007) found that dust-lead levels created by

renovation activities ranged from 422 to 32,633 μg/ft2. While dry sweeping and the use of a regular shop

vacuum resulted in a reduction in these levels, a significant amount of leaded dust remained. All

residents of the household or occupants of the building can be exposed to this dust, regardless of age.

EPA’s Exposure Factors Handbook (EPA 1997) contains recommended soil and dust ingestion estimates

for adults, and EPA’s Child-Specific Exposure Factors Handbook (EPA 2008a), which includes

recommended soil and dust ingestion estimates for children between the ages of 6 and 21.

5.1.1 Regulatory Options for Proposed LRRP Clearance Rule

The economic analysis presented in this report considers various regulatory options. The three primary

options considered in this analysis only differ in the size thresholds that trigger the rule’s requirements

when performing certain renovation activities. The three threshold options considered in this analysis

are:

1. Low Threshold Option

 All event types requiring dust wipe testing where the total amount of lead-based

paint disturbed is larger than 6 square feet.

 Clearance is required for:

- high-speed machine removal of paint larger than 6 square feet, and

- plaster removal using destructive means, larger than 6 square feet.

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2. Proposed Threshold Option

 Dust wipe testing is required for:

- cabinet and trim events larger than 40 square feet,

- scraping of paint larger than 60 square feet,

- heat gun removal of more than 6 square feet

- Window frame or door frame removal events

 Clearance is required for:

- high-speed machine removal of paint larger than 6 square feet, and

- plaster removal using destructive means, larger than 6 square feet.

3. High Threshold Option

 Dust wipe testing is required for:

- cabinet and trim events larger than 80 square feet,

- scraping or heat gun removal of paint larger than 120 square feet, and

- window frame or door frame removal events.

 Clearance is required for:

- high-speed machine removal of paint larger than 60 square feet, and

- plaster removal using destructive means, larger than 60 square feet.

This analysis considers three alternative options in addition to the three primary options: (1) an option

where third party dust wipe testing and clearance is required, (2) an option where dust wipe testing is

required in lieu of the clearance required under the proposed option, and (3) an option where clearance is

required in lieu of the dust wipe testing required under the proposed option. The number of individuals

affected under these alternative options are the same as those affected under the proposed option.

Therefore, separate estimates of affected populations are not presented for these alternative options.

All the primary and alternative options are analyzed under the baseline scenario where the opt-out

provision of the 2008 LRRP rule has been eliminated as proposed (the opt out provision allows owneroccupied housing units where no child under the age of six or pregnant woman resides to opt out of the

rule’s requirements). Since the LRRP Opt-Out Rule is not a final rule, the analysis also presents

estimates of the populations affected by the proposed LRRP Clearance Rule under the alternative baseline

assuming the regulated universe under the 2008 LRRP Rule (which excludes opt-out eligible housing

from the universe). Table 5-1 summarizes the options presented in the economic analysis.

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Table 5-1: Options Included in Economic Analysis

Option/Baseline Size Threshold Dust Wipe Testing and

Clearance

Third Party

Requirement Baseline

Low Threshold

Option

Size thresholds are

lower or equal to

proposed rule

No 2008 +

Opt Out

Proposed

Threshold

Option

Size thresholds are

as proposed No 2008 +

Opt Out

High Threshold

Option

Size thresholds are

higher or equal to

proposed rule

Dust wipe testing is required for:

1. cabinet and trim events

2. scraping of paint

3. heat gun removal of paint

4. Window frame or door frame

removal events

Clearance is required for:

1. high-speed machine removal of

paint

2. plaster removal using

destructive means

No 2008 +

Opt Out

Third Party

Option Same as Proposed

Dust wipe testing and clearance

are required in the same instances

as proposed

Yes 2008 +

Opt Out

Dust Wipe

Testing Only

Option

Same as Proposed

Dust wipe testing is required in

instances where dust wipe testing

or clearance are required under the

proposed option

No 2008 +

Opt Out

Clearance Only

Option Same as Proposed

Clearance is required in instances

where dust wipe testing or

clearance are required under the

proposed option

No 2008 +

Opt Out

Proposed Option

with Alternative

Baseline

Same as Proposed Same as Proposed No 2008

5.2 Residents and Occupants of Structures Regulated by the Proposed LRRP

Clearance Rule

The residents and occupants of the structures regulated under the proposed LRRP Clearance Rule include:

(1) children residing in target housing, (2) children receiving childcare in target housing, (3) children

attending daycare in a public or commercial building, (4) children attending school in a public or

commercial building, (5) adults residing in target housing, (6) adults working in a public or commercial

building COF. This section presents the estimated number of individuals who reside in or occupy these

regulated structures and presents the estimated number of these individuals residing in or occupying a

structure where dust wipe testing or clearance is expected to be performed.

Section 5.2.1 describes the methods and sources for these estimates and section 5.2.2 presents the

resulting estimated populations.

5.2.1 Methodology and Sources for Estimating Affected Populations

This analysis presents the estimated number of target housing residents, children receiving childcare in

target housing, and children attending daycare or schools in public and commercial buildings. The

number of adults who work in a public or commercial building COF was not estimated for this analysis,

but these individuals would also be expected to benefit from the proposed rule.

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5.2.1.1 Estimating the Number of Target Housing Residents

The 2003 American Housing Survey (AHS) (U.S. Census, 2003) was used to estimate the number of

individuals residing in target housing where dust wipe testing and clearance events occur. The AHS

includes household level microdata with information on the number and ages of housing occupants,

household-level renovation data, and other housing characteristics. Chapter 4 of this report provides a

description of how EPA estimated the frequencies of dust wipe testing and clearance activities using AHS

data and questionnaires administered to fewer than 10 respondents. This methodology was used to

determine which respondent households in the AHS data were performing regulated renovation activities,

and therefore the number and demographics of the occupants residing in these households can easily be

determined since this is reported at the household level. For example, some households reported

remodeling their kitchen in the American Housing Survey, and a subset of these households are estimated

to trigger the dust wipe testing requirements associated with trim and cabinet replacement (as described in

Chapter 4). Since the American Housing Survey includes information on the number and ages of housing

occupants, the number and ages of individuals affected by the rule in these households can be estimated.

5.2.1.2 Estimating the Number of Children Receiving Childcare in Target Housing

EPA estimated the number of children receiving childcare in target housing affected by the dust wipe

testing and clearance requirements in three steps: (1) the number of target housing unit COFs and the

frequency of regulated activities was estimated; (2) the number of children receiving childcare in target

housing was estimated; and (3) the estimated frequencies of the activities in target housing were applied

to number of children receiving childcare in these target housing units to estimate the number of children

affected by the proposed rule.

Step One: Estimate Number of Target Housing COFs and the Frequency of Regulated Activities

The estimate of the number of target housing units that are COFs was developed for the economic

analysis of the 2008 LRRP Rule. EPA (2008b) provides a detailed explanation of these estimates which

is summarized here. The COFs in target housing include family daycare providers and the homes of

family, friends, and neighbors who regularly care for someone else’s children. The estimates include care

provided for pay and not for pay, and rely primarily on estimates of the size of the childcare workforce as

published by the Center for Childcare Workforce, 2002. This report includes data on the number of: (1)

family childcare providers caring for unrelated children, (2) paid relatives and non-relatives providing

childcare, and (3) unpaid relatives and non-relatives providing childcare.

Based on data provided by the Center for Childcare Workforce, a total of just under 2.4 million caregivers

provide care outside of the child’s home for more than six hours per week. As described in detail by EPA

(2008b), these data are used to estimate the number of COFs in target housing. These numbers are further

reduced to estimate the number of pre-1978 housing units based on American Housing Survey data. The

frequency of dust wipe testing and clearance is assumed to be the same in target housing COFs as

estimated for other target housing.

Step Two: Estimate Number of Children Receiving Childcare in Target Housing

Data from Table 2 of Mulligan et al (2001) were used to determine the number of children under six years

of age in Target Housing COFs. Population data from Mulligan et al (2001) for target housing includes

children in the care of relatives and non-relatives as well as the proportion (5 percent) of children in

centers identified as being in private settings (i.e., family care).1 Other adjustments were made to exclude

1 This analysis assumes that all daycare centers are located in public or commercial buildings (i.e., not in

residential buildings). Due to differences in licensing requirements and survey questionnaire design, some

sources used in this analysis categorize children cared for in residential settings as being in center-based care.

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paid care by a non-relative (e.g., a nanny) in the child’s home. Relative and non-relative care were further

classified into paid and non-paid care. Based on information presented in Mulligan et al (2001), the

following adjustments were made for each category:

1. Paid non-relative care not in the child’s home (i.e., family care):

a. 81 percent of non-relative care occurs in location outside of the child’s home.

b. 5 percent of center-based care occurs in a private setting – assumed to be non-relative

care outside child’s home.

c. 90 percent of non-relative care is paid.

2. Unpaid non-relative care (not in the child’s home):

a. 81 percent of non-relative care occurs in location outside of the child’s home.

b. 5 percent of center based care occurs in a private setting – assumed to be non-relative

care outside child’s home.

c. 10 percent of non-relative care is unpaid paid.

3. Paid relative care:

a. 28 percent of relative care is paid.

4. Unpaid relative care:

a. The difference between all relative care and paid relative care.

Step 3: Apply the Estimated Event Frequencies to the Estimated Populations

The frequencies of regulated activities described in step one are applied to the estimated populations to

estimate the number of children affected by the dust wipe testing and clearance requirements.

5.2.1.3 Estimating Populations of Children Attending Schools in Public or Commercial Building

COFs

The population of children attending schools was estimated from the Common Core of Data – Public

Elementary/Secondary School Universe Survey Data (NCES, 2006b). The building age distribution

percentages found in the CBECS data were used to calculate the number of children in pre-1978 buildings

(58 percent). See Chapter 4 of this report for a description of the how the frequencies of RRP, dust wipe

testing, and clearance were estimated for schools in public or commercial buildings.

5.2.1.4 Estimating Populations of Children Attending Daycare in Public or Commercial Building

COFs

Data from Table 2 of Mulligan et al. (2005) were used to determine the number of children under six

years of age in childcare centers. Center-based arrangements include day care centers, Head Start

programs, preschools, pre-kindergartens, and other early childhood programs. Table 4 of Mulligan et. al

indicated that 6,695,000 children were in center-based care.

To avoid double counting with other structures where childcare is provided, children in center-based

childcare reported to be in pre-kindergarten and kindergarten and target housing settings were removed

from the daycare center count. The following adjustments were made:

1. Subtract from childcare center population the proportion of children in pre-kindergarten and

kindergarten (27 percent)

Whenever possible, these daycare facilities and the children they serve were included in the family daycare,

rather than in daycare center counts.

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2. Subtract from childcare center population the proportion of children in private or target housing

settings (5 percent)

The building age distribution percentages found in the CBECS data were used to calculate the number of

children in pre-1978 buildings (58 percent).

5.2.2 Estimated Affected Populations

Table 5-2 through Table 5-5 present the number of individuals affected during the first year of the rule by

the proposed LRRP Clearance Rule under the three primary options considered in this analysis. (The

other three options – third party sampling, dust wipe testing only, and clearance only) protect the same

number of individuals as the proposed option, although the level of protection may differ.) The first row

of these tables presents the number of children who reside in or occupy (i.e., receive childcare or attend

school in) regulated structures during the first year of the rule. The number of children affected by dust

wipe testing and clearance activities is both presented separately and combined. In addition, the tables

break out the estimated populations according to whether or not the dust wipe testing or clearance applies

to windows only or to both windows and floors (because when floors are carpeted, the requirements only

apply to window sills and troughs).

Table 5-2: Number of Children Under the Age of Six Residing or Occupying Regulated Target

Housing or Public or Commercial Building COFs by Type of Dust Wipe Testing or Clearance

Activity Performed: Low Threshold Option (First Year, thousands)

Target Housing Public and Commercial

Buildings Activity Performed Residents Daycare

Attendees

Daycare

Attendees

School

Attendees

Total

Number of

Children (<6)

All Occupants of Regulated Structures 17,772 3,448 2,647 3,429 27,296

Dust Wipe Testing

Window Tests Only1

303 20 5 7 335

Window and Floor Tests2

450 45 11 14 519

Subtotal 753 65 16 21 855

Clearance

Window Clearance Only1

5 1 1 1 8

Window and Floor Clearance2

12 2 2 3 19

Subtotal 17 2 3 4 27

Dust Wipe Testing or Clearance

Window Test/Clearance Only1307 21 7 9 343

Window and Floor Test/Clearance2463 46 13 17 538

Subtotal 770 67 19 25 882

1These events are performed where floors are carpeted and therefore floors would not be subject to dust wipe testing or clearance

requirements.

2 These events are performed where floors are not carpeted and therefore floors would be subject to dust wipe testing or

clearance requirements.

Note: A zero indicates a positive number less than 500.

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Table 5-3: Number of Children Under the Age of Six Residing or Occupying Regulated Target

Housing or Public or Commercial Building COFs by Type of Dust Wipe Testing or Clearance

Activity Performed: Proposed Threshold Option (First Year, thousands)

Target Housing Public and Commercial

Buildings Activity Performed Residents Daycare

Attendees

Daycare

Attendees

School

Attendees

Total

Number of

Children (<6)

All Occupants of Regulated Structures 17,772 3,448 2,647 3,429 27,296

Dust Wipe Testing

Window Tests Only1289 18 5 7 320

Window and Floor Tests2401 37 11 14 462

Subtotal 690 55 16 21 782

Clearance

Window Clearance Only1

5 1 1 1 8

Window and Floor Clearance2

12 2 2 3 19

Subtotal 17 2 3 4 27

Dust Wipe Testing or Clearance

Window Test/Clearance Only1

294 19 7 9 328

Window and Floor Test/Clearance2

413 39 13 17 481

Subtotal 707 57 19 25 809

1These events are performed where floors are carpeted and therefore floors would not be subject to dust wipe testing or clearance

requirements.

2 These events are performed where floors are not carpeted and therefore floors would be subject to dust wipe testing or

clearance requirements.

Note: A zero indicates a positive number less than 500.

Table 5-4: Number of Children Under the Age of Six Residing or Occupying Regulated Target

Housing or Public or Commercial Building COFs by Type of Dust Wipe Testing or Clearance

Activity Performed: High Threshold Option (First Year, thousands)

Target Housing Public and Commercial

Buildings Activity Performed Residents Daycare

Attendees

Daycare

Attendees

School

Attendees

Total

Number of

Children (<6)

All Occupants of Regulated Structures 17,772 3,448 2,647 3,429 27,296

Dust Wipe Testing

Window Tests Only1

260 15 5 7 287

Window and Floor Tests2

342 29 11 14 395

Subtotal 602 44 16 21 682

Clearance

Window Clearance Only1

4 1 1 1 7

Window and Floor Clearance2

10 1 2 3 17

Subtotal 14 2 3 4 24

Dust Wipe Testing or Clearance

Window Test/Clearance Only1264 15 7 9 294

Window and Floor Test/Clearance2352 31 13 17 412

Subtotal 616 46 19 25 706

1These events are performed where floors are carpeted and therefore floors would not be subject to dust wipe testing or clearance

requirements.

2 These events are performed where floors are not carpeted and therefore floors would be subject to dust wipe testing or

clearance requirements.

Note: A zero indicates a positive number less than 500.

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Table 5-5: Number of Individuals Age of Six and Older Residing in Regulated Target Housing, by

option (First Year, thousands)

Low Threshold Option Proposed Option High Threshold Option

Activity Performed Age 6 and

Older3

Pregnant

Women

Age 6 and

Older3

Pregnant

Women

Age 6 and

Older3

Pregnant

Women

All Occupants of Regulated Structures 209,040 2,467 209,040 2,467 209,040 2,467

Dust Wipe Testing

Window Tests Only13,356 42 3,204 40 2,873 35

Window and Floor Tests24,677 60 4,183 53 3,586 45

Subtotal 8,033 103 7,388 94 6,458 81

Clearance

Window Clearance Only1

46 1 48 1 39 1

Window and Floor Clearance2

114 2 112 1 93 1

Subtotal 160 2 160 2 132 2

Dust Wipe Testing or Clearance

Window Test/Clearance Only1

3,403 43 3,252 41 2,912 36

Window and Floor Test/Clearance2

4,790 62 4,295 55 3,678 47

Subtotal 8,193 105 7,547 96 6,590 83

1These events are performed where floors are carpeted and therefore floors would not be subject to dust wipe testing or clearance

requirements.

2 These events are performed where floors are not carpeted and therefore floors would be subject to dust wipe testing or clearance

requirements.

3 The Age 6 and Older columns also include pregnant women.

Note: A zero indicates a positive number less than 500.

The information provided as a result of the proposed dust wipe testing requirements will generate benefits

by increasing building owners’ and occupants’ understanding and awareness of dust lead hazards, and

improving their ability to make further risk management decisions. The proposed dust wipe testing

requirements may also change the behavior of renovation firms. The information from the dust wipe

testing may help renovation firms to improve their cleaning efficiency by providing feedback on how well

they are cleaning up after renovations. In addition, the information provision may result in indirect

benefits due to behavioral changes by owners and occupants such as performing additional cleaning or

taking steps to control or remove the lead-based paint. These behavioral changes can result in additional

costs as well as in benefits from reductions in exposure.

Because the current state of knowledge about the economics of information is not highly developed, this

analysis does not attempt to quantify the direct, informational benefits of the dust wipe testing

requirements. In addition, due to the inherent uncertainty in predicting the chain of events, this analysis

does not attempt to predict either the benefits or the costs of the behavioral changes resulting from the

information provision.

In addition to information provision, the proposed rule requires additional cleaning to be performed for

certain jobs where dust levels exceed one of the hazard standards. However, EPA’s Dust Study (EPA

2007) did not include these jobs (demolition or removal of plaster through destructive means, and the use

of machines that remove lead-based paint through high speed operation with HEPA exhaust control).

This analysis does not quantify the benefits of this additional cleaning because data are not available to

accurately characterize the dust lead levels generated by these renovation activities, or how they will be

affected by the proposed Clearance rule’s requirements.

EPA’s 2008 RRP rule took effect in April 2010, so those requirements are part of the baseline for this

analysis. Most of the experiments in EPA’s Dust Study that followed work practices equivalent to those

required by the 2008 RRP rule resulted in post-verification dust-lead levels that were below the lead

hazard standard levels developed under TSCA section 403. But the proportion of Dust Study experiments

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that exceeded the hazard standard is not a proxy for the fraction of the population that would benefit as a

result of the proposed rule. As explained below, without the Clearance rule in place some renovators may

not be as effective at reducing dust-lead levels as the Dust Study indicates; some of the jobs covered by

the proposed Clearance rule differ from those in the Dust Study; and exposures to low levels of lead

(below the hazard standards) can still result in adverse health effects. Thus, many occupants of target

housing and COFs where Clearance rule renovations occur may receive some type of benefits.

First, some renovators following the work practices in the 2008 RRP rule may not achieve the same dustlead reductions as the Dust Study indicates. The Dust Study renovators may have been particularly

careful in following the work practices because the dust levels were being tested after the work was

completed. Since the Clearance rule would require dust wipe testing after the work is completed, the

results of the Dust Study may be more representative of dust levels with the Clearance rule in place than

without it.

Second, the Dust Study did not address all the same job categories as the proposed Clearance rule. For

example, the Dust Study did not include the demolition or removal of plaster through destructive means.

If these Clearance rule jobs generate higher dust-lead levels than the experiments in the Dust Study, or

leave behind dust particles that are more difficult to clean up because of their fine size or other

characteristics, then occupants will have higher lead exposures than the Dust Study experiments would

indicate.

Finally, it is not appropriate to treat the regulatory hazards standards as a threshold below which there are

no benefits to reducing lead exposure. While levels approaching or exceeding the hazard standards are of

particular concern, it appears that some of the adverse health effects caused by exposure to lead

(particularly changes in the levels of certain blood enzymes and in aspects of children's neurobehavioral

development) may occur at blood-lead levels so low as to be essentially without a threshold. Thus, there

are health benefits to reducing lead levels to below the hazard standard. If renovators or consumers

decide to clean to lead levels below the hazard standard based on the dust wipe testing information, that

would provide additional health benefits to the occupants.

Under the proposed rule, reoccupancy of the work area can occur immediately after the dust wipe samples

are collected. However, there is a delay between when the samples are taken and when the dust wipe

testing results are communicated to owners and occupants. If a fixed site laboratory is used, there may be

time needed to send the samples to the laboratory; for the laboratory to analyze the samples and return the

results; for the inspector, risk assessor, or dust sampling technician to prepare a dust wipe testing report

and provide it to the renovation firm; and for the renovation firm to provide the report to the owner and

occupants.

In cases where the occupants re-enter the work area before receiving the dust wipe testing report, and

where renovators, owners, or occupants act to reduce lead levels or exposures as a result of the

information, the delay between sampling and the receipt of the report by owners and occupants can

reduce the health benefits compared to a situation where occupants do not re-enter the work area until

after the report has been received.

Preventing occupants in these cases from reoccupying the work area until they receive the testing results

would create additional benefits due to reduced exposures. But in some cases the delay while waiting for

the test results could be significantly longer than the time spent conducting the renovation. (A covered

renovation might be completed in as little as a day, while in some cases owners and occupants might not

receive the test results until a week or more after the samples are taken.) Preventing occupants from reentering the space while the test results are pending would be disruptive and might cause them to incur

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additional costs, such as renting alternate space. This analysis does not estimate the benefits or costs of

an alternative prohibiting occupancy of the work area until the test results have been received.

5.3 Lead-Related Health Effects and Ecological Effects

Lead exposure can cause many adverse health and ecological effects. This section supplements the

benefits chapter by providing a broader, qualitative discussion of lead-related effects (including adult

effects and ecological effects), based on EPA’s Air Quality Criteria for Lead.

The information provided in this section is an excerpt from the Executive Summary of the document Air

Quality Criteria for Lead (United States Environmental Protection Agency, October 2006, EPA/600/R5/144aF, this document is available at http://cfpub.epa.gov/ncea/cfm/recordisplay.cfm?deid=158823).

Specifically, the information provided in this section is directly from the following sections of the

Executive Summary:

E.4 Health Effects Associated with Lead Exposure

E.5 Human Population Groups at Special Risk and Potential Public Health Impacts

E.6 Environmental Effects of Lead

5.3.1 Background

The purpose of the 2006 Lead Air Quality Criteria document (AQCD) is to critically assess the latest

scientific information on lead. The final version of the revised Lead AQCD mainly assesses pertinent

literature published or accepted for publication through December 2005.

The First External Review Draft (dated December 2005) of the revised Lead AQCD underwent public

comment and was reviewed by the Clean Air Scientific Advisory Committee (CASAC) at a public

meeting held in Durham, NC on February 28-March 1, 2006. The public comments and CASAC

recommendations received were taken into account in making appropriate revisions and incorporating

them into a Second External Review Draft (dated May, 2006) which was released for further public

comment and CASAC review at a public meeting held June 28-29, 2006. In addition, still further revised

drafts of the Integrative Synthesis chapter and the Executive Summary were then issued and discussed

during an August 15, 2006 CASAC teleconference call. Public comments and CASAC advice received

on these latter materials, as well as Second External Review Draft materials, were taken into account in

making and incorporating further revisions into this final version of the Lead AQCD.

5.3.2 Health Effects Associated with Lead Exposure

Both epidemiologic and toxicological studies have shown that environmentally relevant levels of lead

affect many different organ systems. Research completed since the 1986 AQCD/Addendum and 1990

Supplement indicates that lead effects occur at blood-lead levels even lower than those previously

reported for many endpoints. Remarkable progress has been made since the mid-1980s in understanding

the Pb effects on health. Recent studies have focused on details of the associations, including the shapes

of concentration-response relationships, especially at levels well within the range of general population

exposures, and on those biological and/or socio-environmental factors that either increase or decrease an

individual’s risk. Key findings and conclusions regarding important outcomes of newly available

toxicological and epidemiologic studies of Pb health effects are highlighted below.

5.3.2.1 Neurotoxic Effects

 Neurobehavioral effects of Pb-exposure early in development (during fetal, neonatal, and later

postnatal periods) in young infants and children (<7 years old) have been observed with

remarkable consistency across numerous studies involving varying study designs, different

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developmental assessment protocols, and diverse populations. Negative Pb impacts on

neurocognitive ability and other neurobehavioral outcomes are robust in most recent studies even

after adjustment for numerous potentially confounding factors (including quality of care giving,

parental intelligence, and socioeconomic status). These effects generally appear to persist into

adolescence and young adulthood.

 The overall weight of the available evidence provides clear substantiation of neurocognitive

decrements being associated in young children with blood-Pb concentrations in the range of 5-10

μg/dL, and possibly somewhat lower. Some newly available analyses appear to show Pb effects

on the intellectual attainment of preschool and school age children at population mean concurrent

blood-Pb levels ranging down to as low as 2 to 8 μg/dL. A decline of 6.2 points in full scale IQ

for an increase in concurrent blood Pb levels from 1 to 10 μg/dL has been estimated, based on a

pooled analysis of results derived from seven well-conducted prospective epidemiologic studies.

 In the limited literature examining the effects of environmental Pb exposure on adults, mixed

evidence exists regarding associations between Pb and neurocognitive performance. No

associations were observed between cognitive performance and blood Pb levels; however,

significant associations were observed in relation to bone Pb concentrations, suggesting that longterm cumulative Pb exposure may contribute to neurocognitive deficits in adults.

 Animal toxicology data indicate that developmental Pb exposures creating steady-state blood-Pb

concentrations of ~10 μg/dL result in behavioral impairments that persist into adulthood in rats

and monkeys. No evident threshold has yet been found; and Pb-induced deficits, for the most

part, have been found to be very persistent, even with various chelation treatments. However,

experimental studies indicate that environmental enrichment during development can partially

mitigate the effects of Pb on cognitive function. In rats, neurobehavioral deficits that persisted

well into adulthood were observed with prenatal, preweaning, and postweaning Pb exposure. In

monkeys, such neurobehavioral deficits were observed both with in utero-only exposure and with

early postnatal-only exposure when peak blood-Pb levels did not exceed 15 μg/dL and steadystate levels were ~11 μg/dL.

 Learning impairment has been observed in animal studies at blood levels as low as 10 μg/dL,

with higher level learning showing greater impairment than simple learning tasks. The

mechanisms associated with these deficits include: response preservation; insensitivity to changes

in reinforcement density or contingencies; deficits in attention; reduced ability to inhibit

inappropriate responding; impulsivity; and distractibility.

 Lead affects reactivity to the environment and social behavior in both rodents and nonhuman

primates at blood Pb levels of 15 to 40 μg/dL. Rodent studies also show that Pb exposure

potentiates the effects of stress in females.

 Auditory function has also been shown to be impaired at blood Pb levels of 33 μg/dL, while

visual functions are affected at 19 μg/dL.

 Neurotoxicological studies in animals clearly demonstrated that Pb mimics calcium and affects

neurotransmission and synaptic plasticity.

 Epidemiologic studies have identified genetic polymorphisms of two genes that may alter

susceptibility to the neurodevelopmental consequences of Pb exposure in children. Variant alleles

of the ALAD gene are associated with differences in absorption, retention, and toxicokinetics of

Pb. Polymorphisms of the vitamin D receptor gene have been shown to affect the rate of

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resorption and excretion of Pb over time. These studies are only suggestive, and parallel animal

studies have not been completed.

5.3.2.2 Cardiovascular Effects

 Epidemiologic studies have consistently demonstrated associations between Pb exposure and

enhanced risk of deleterious cardiovascular outcomes, including increased blood pressure and

incidence of hypertension. A meta-analysis of numerous studies estimates that a doubling of

blood-Pb level (e.g., from 5 to 10 μg/dL) is associated with ~1.0 mm Hg increase in systolic

blood pressure and ~0.6 mm Hg increase in diastolic pressure. Studies have also found that

cumulative past Pb exposure (e.g., bone Pb) may be as important, if not more, than present Pb

exposure in assessing cardiovascular effects. The evidence for an association of Pb with

cardiovascular morbidity and mortality is limited but supportive.

 Experimental toxicology studies have confirmed Pb effects on cardiovascular functions. Most

have shown that exposures creating blood-Pb levels of ~20 to 30 μg/dL for long periods result in

arterial hypertension that persists long after cessation of Pb exposure in genetically normal

animals. One study reported blood pressure increases at blood-Pb levels as low as 2 μg/dL in rats.

A number of in vivo and in vitro studies provide compelling evidence for the role of oxidative

stress in the pathogenesis of Pb-induced hypertension. However, experimental investigations of

cardiovascular effects of Pb in animals are unclear as to why low, but not high, levels of Pb

exposure cause hypertension in experimental animals.

5.3.2.3 Renal Effects

 In the general population, both circulating and cumulative Pb was found to be associated with

longitudinal decline in renal function. Effects on creatine clearance have been reported in human

adult hypertensives to be associated with general population mean blood-Pb levels of only 4.2

μg/dL. The public health significance of such effects is not clear, however, in view of more

serious signs of kidney dysfunction being seen in occupationally exposed workers only at much

higher blood-Pb levels (>30-40 μg/dL).

 Experimental studies using laboratory animals demonstrated that the initial accumulation of

absorbed Pb occurs primarily in the kidneys. This takes place mainly through glomerular

filtration and subsequent reabsorption, and, to a small extent, through direct absorption from the

blood. Both low dose Pb-treated animals and high dose Pb-treated animals showed a

“hyperfiltration” phenomenon during the first 3 months of Pb exposure. Investigations into

biochemical alterations in Pb-induced renal toxicity suggested a role for oxidative stress and

involvement of NO, with a significant increase in nitrotyrosine and substantial fall in urinary

excretion of NOx.

 Iron deficiency increases intestinal absorption of Pb and the Pb content of soft tissues and bone.

Aluminum decreases kidney Pb content and serum creatinine in Pb-intoxicated animals. Age also

has an effect on Pb retention. There is higher Pb retention at a very young age and lower bone and

kidney Pb at old age, attributed in part to increased bone resorption and decreased bone accretion

and, also, kidney Pb.

5.3.2.4 Immune System Effects

 Findings from recent epidemiologic studies suggest that Pb exposure may be associated with

effects on cellular and humoral immunity. These include changes in serum immunoglobulin

levels. Studies of biomarkers of humoral immunity in children have consistently found significant

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associations between increasing blood-Pb concentrations and serum IgE levels at blood-Pb levels

<10 μg/dL.

 Toxicologic studies have shown that Pb targets immune cells, causing suppression of delayed

type hypersensitivity response, elevation of IgE, and modulation of macrophages into a hyperinflammatory phenotype. These types of changes can cause increased risk of atopy, asthma, and

some forms of autoimmunity and reduced resistance to some infectious diseases. Lead exposure

of embryos resulting in blood-Pb levels <10 μg/dL can produce persistent later-life

immunotoxicity.

5.3.2.5 Effects on Heme Synthesis

 Lead exposure has been associated with disruption of heme synthesis in both children and adults.

A 10% probability of anemia (hematocrit <35%) is estimated to be associated with a blood-Pb

level of ~20 μg/dL at age 1 year. Increases in blood Pb concentration of about 20-30 μg/dL are

sufficient to halve erythrocyte ALAD activity and sufficiently inhibit ferrochelatase to double

erythrocyte protoporphyrin levels.

 Toxicological studies demonstrated that Pb intoxication interferes with red blood cell (RBC)

survival and alters RBC mobility. Hematological parameters, such as mean corpuscular volume,

mean corpuscular hemoglobin, and mean corpuscular hemoglobin concentration, are also

significantly decreased upon exposure to Pb. These effects are due to internalization of Pb by

RBC. The transport of Pb across the RBC membrane is energy-independent and carrier-mediated;

and the uptake of Pb appears to be mediated by an anion exchanger through a vanadate-sensitive

pathway.

 Erythrocyte ALAD activity ratio (ratio of activated/non activated enzyme activity) has been

shown to be a sensitive, dose-responsive measure of Pb exposure, regardless of the mode of

administration of Pb. Competitive enzyme kinetic analyses in RBCs from both humans and

Cynomolgus monkeys indicated similar inhibition profiles by Pb.

5.3.2.6 Effects on Bones and Teeth

 Experimental studies in animals demonstrate that Pb substitutes for calcium and is readily taken

up and stored in the bone and teeth of animals, potentially allowing bone cell function to be

compromised both directly and indirectly by exposure. Relatively short-term exposure of mature

animals to Pb does not result in significant growth suppression. However, chronic Pb exposure

during times of inadequate nutrition has been shown to adversely influence bone growth,

including decreased bone density, decreased trabecular bone, and growth plates.

 Exposure of developing animals to Pb during gestation and the immediate postnatal period has

clearly been shown to significantly depress early bone growth in a dose-dependent fashion,

though this effect is not manifest below a certain threshold.

 Systemically, Pb has been shown to disrupt mineralization of bone during growth, to alter

calcium binding proteins, and to increase calcium and phosphorus concentration in the blood

stream, in addition to potentially altering bone cell differentiation and function by altering plasma

levels of growth hormone and calciotropic hormones such as vitamin D3 [1,25- (OH2)D3.

 Periods of extensive bone remodeling, such as occur during weight loss, advanced age, altered

metabolic state, and pregnancy and lactation are all associated with mobilization of Pb stores

from bone of animals.

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 Numerous epidemiologic studies and, separately, animal studies (both post-eruptive Pb exposure

and pre- and perinatal Pb exposure studies) suggest that Pb is a caries-promoting element.

However, whether Pb incorporation into the enamel surface compromises the integrity and

resistance of the surface to dissolution, and ultimately increases risk of dental decay, is unclear.

 Increased risk of dental caries has been associated with Pb exposure in children and adults. Lead

effects on caries were observed in populations whose mean blood-Pb levels were less than 10

μg/dL.

5.3.2.7 Reproductive and Developmental Effects

 Epidemiologic evidence suggests small associations between Pb exposure and male reproductive

outcomes, including perturbed semen quality and increased time to pregnancy. There are no

adequate epidemiologic data to evaluate associations between Pb exposure and female fertility.

Most studies have yielded no associations, or weak associations, of Pb exposure with thyroid

hormone status and male reproductive endocrine status in highly exposed occupational

populations.

 New toxicologic studies support earlier conclusions, presented in the 1986 Lead AQCD, that (a)

Pb can produce both temporary and persisting effects on male and female reproductive function

and development and (b) Pb disrupts endocrine function at multiple points along the

hypothalamic-pituitary-gonadal axis. Although there is evidence for a common mode of action,

consistent effects on circulating testosterone levels are not always observed in Pb-exposed

animals. Inconsistencies in reports of circulating testosterone levels complicate derivation of a

dose-response relationship for this endpoint.

 Lead-induced testicular damage (ultrastructural changes in testes of monkeys at blood-Pb >35 to

40 μg/dL) and altered female sex hormone release, imprinting during early development, and

altered female fertility all suggest Pb-induced reproductive effects. However, Pb exposure does

not generally produce total sterility. Pre- and postnatal exposure to Pb has been demonstrated to

result in fetal mortality and produce a variety of sublethal effects in the offspring. Many of the

Pb-induced sublethal developmental effects occur at maternal blood-Pb levels that do not result in

clinical (overt) toxicity in the mothers. Teratogenic effects resulting from Pb exposure reported in

a few studies appear to be confounded by maternal toxicity.

5.3.2.8 Effects on Other Organ Systems

 Lead impacts the hypothalamic-pituitary-adrenal axis, elevating corticosterone levels and altering

stress responsivity. This may be a potential mechanism contributing to Pb-induced hypertension,

with further possible roles in the etiology of diabetes, obesity and other disorders.

 Studies of hepatic enzyme levels in serum suggest that liver injury may be present in Pb workers;

however, associations specifically with Pb exposures are not evident. Children exposed to

relatively high levels of Pb (blood Pb >30 μg/dL) exhibit depressed levels of circulating 1,25-

dihydroxy vitamin D (1,25-OH-D). However, associations between serum vitamin D status and

blood Pb were not evident in a study of calcium-replete children who had average lifetime bloodPb concentrations <25 μg/dL.

 Field studies that evaluated hepatic enzyme levels in serum suggest that liver injury may be

present in Pb workers; however, associations specifically with Pb exposures have not been well

established.

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 Simultaneous induction of the activities of phase II drug metabolizing enzymes and decreased

phase I enzymes with a single exposure to Pb nitrate in rat liver suggest that Pb is capable of

causing biochemical phenotype similar to hepatic nodules.

 Newer studies examined the induction of GST-P at both transcriptional and translational levels

using in vitro systems and indicated a role for Pb-nitrate and Pb-acetate in the induction process.

 Lead-induced alterations in cholesterol metabolism appear to be mediated by the induction of

several enzymes related to cholesterol metabolism and the decrease of 7 α-hydroxylase, a

cholesterol-catabolizing enzyme. This regulation of cholesterol homeostasis is modulated by

changes in cytokine expression and related signaling.

 Newer experimental evidence suggests that Pb-induced alterations in liver heme metabolism

involve perturbations in ALAD activity, porphyrin metabolism, alterations in Transferrin gene

expression, and associated changes in iron metabolism.

 Gastrointestinal (GI) absorption of Pb is influenced by a variety of factors, including chemical

and physical forms of the element in ingested media, age at intake, and various nutritional factors.

The degeneration of intestinal mucosal epithelium leading to potential malabsorption and

alterations in the jejunal ultrastructure (possibly associated with distortion of glycocalyx layer)

have been reported in the intestine of Pb-exposed rats.

 Nutritional studies that varied Pb, Ca, and vitamin D levels in the diet have demonstrated

competition of Pb with Ca absorption. Supplementation with vitamin D has been reported to

enhance intestinal absorption of Ca and Pb. Physiological amounts of vitamin D, when

administered to vitamin D-deficient rats, resulted in elevated Pb and Ca levels. In the case of

severe Ca deficiency, Pb ingestion results in a marked decrease in serum 1,25 hydroxy vitamin D.

5.3.2.9 Genotoxic and Carcinogenic Effects

 Epidemiologic studies of highly exposed occupational populations suggest a relationship between

Pb and cancers of the lung and the stomach; however the evidence is limited by the presence of

various potential confounders, including metal coexposures (e.g., to arsenic, cadmium), smoking,

and dietary habits. The 2003 NTP and 2004 IARC reviews concluded that Pb and Pb compounds

were probable carcinogens, based on limited evidence in humans and sufficient evidence in

animals. Similarly, Pb and Pb compounds would likely be classified as likely to be carcinogenic

to humans according to the new 2005 EPA Cancer Assessment Guidelines for Carcinogen Risk

Assessment, based on animal data even though the human data are inadequate.

 Studies of genotoxicity consistently find associations of Pb exposure with DNA damage and

micronuclei formation; however, the associations with the more established indicator of cancer

risk, chromosomal aberrations, are inconsistent.

 Pb is an animal carcinogen and extends our understanding of mechanisms involved to include a

role for metallothionein. Specifically, the recent data show that metallothionein may participate in

Pb inclusion bodies and, thus, serves to prevent or reduce Pb-induced tumorigenesis.

 In vitro cell culture studies that evaluated the potential for Pb to transform rodent cells are

inconsistent, and careful study of a time course of exposure is necessary to determine whether Pb

actually induces transformation in cultured rodent cells. There is increased evidence suggesting

that Pb may be co-carcinogenic or promotes the carcinogenicity of other compounds. Cell culture

studies do support a possible epigenetic mechanism or co-mutagenic effects.

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5.3.2.10 Lead-Binding Proteins

 Proteins depending upon sulfur-containing side chains for maintaining conformity or activity are

vulnerable to inactivation by Pb, due to its strong sulfur-binding affinity.

 The enzyme, ALAD, a 280 kDa protein, is inducible and is the major Pb-binding protein within

the erythrocyte.

 The Pb-binding protein in rat kidney has been identified as a cleavage product of α-2-

microglobulin. The low molecular weight Pb-binding proteins in human kidney have been

identified as thymosin β 4 (molecular weight 5 kDa) and acyl-CoA binding protein (molecular

weight 9 kDa). In human brain, Pb-binding proteins include thymosin β4 and an unidentified

protein of 23 kDa.

 Animal toxicology studies with metallothionein-null mice demonstrated a possible role for

metallothionein as a renal Pb-binding protein.

5.3.2.11 Human Population Groups At Special Risk And Potential Public Health Impacts

 Children, in general and especially low SES (often including larger proportions of AfricanAmerican and Hispanic) children, have been well-documented as being at increased risk for Pb

exposure and Pb-induced adverse health effects. This is due to several factors, including

enhanced exposure to Pb via ingestion of soil-Pb and/or dust-Pb due to normal hand-to-mouth

activity and/or pica.

 Even children with low Pb exposure levels (having blood Pb of 5-10 μg/dL or, possibly,

somewhat lower) are at notable risk, due to apparent non-linear dose-response relationships

between blood Pb and neurodevelopmental outcomes. It is hypothesized that initial

neurodevelopmental lesions occurring at blood-Pb levels <10 μg/dL may disrupt different

developmental processes in the nervous system than more severe high level exposures.

 Adults with idiosyncratic exposures to Pb through occupations, hobbies, make-up use, glazed

pottery, native medicines, and other sources are at risk for Pb toxicity. Certain ethnic and racial

groups are known to have cultural practices that involve ingestion of Pb-containing substances,

e.g., ingestion of foods or beverages stored in Pb-glazed pottery or imported canned food from

countries that allow Pb-soldered cans.

 Cumulative past Pb exposure, measured by bone Pb, may be a better predictor of cardiovascular

effects than current blood-Pb levels. African-Americans are known to have substantially higher

baseline blood pressure than other ethnic groups, so Pb’s impact on an already higher baseline

could indicate a greater susceptibility to Pb for this group.

 Effects on adults of low-level Pb exposures also include some renal effects (i.e., altered creatinine

clearance) at blood-Pb levels <5 ug/dL. Lead exposure combined with other risk factors, such as

diabetes, hypertension, or chronic renal insufficiency may result in clinically relevant effects in

individuals with two or more other risk factors.

 At least two genetic polymorphisms, of the ALAD and the vitamin D receptor gene, have been

suggested to play a role in susceptibility to Pb. In one study, African-American children were

found to have a higher incidence of being homozygous for alleles of the vitamin D receptor gene

thought to contribute to greater Pb blood levels. This work is preliminary and further studies will

be necessary to determine implications of genetic differences that may make certain populations

more susceptible to Pb exposure.

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 What was considered “low” for Pb exposure levels in the 1980s is an order of magnitude higher

than the current mean level in the U.S. population, and current average blood-Pb levels in U.S.

populations remain perhaps as much as two orders of magnitude above preindustrial “natural”

levels in humans. There is no level of Pb exposure that has yet been identified, with confidence,

as being clearly not being associated with possible risk of deleterious health effects. Some recent

studies of Pb neurotoxicity in infants have observed effects at population average blood-Pb levels

of only 1 or 2 μg/dL; and some cardiovascular, renal, and immune outcomes have been reported

at blood-Pb levels below 5 μg/dL.

 Public health interventions have resulted in declines, over the last 25 years, of more than 90% in

the mean blood-Pb level within all age and gender subgroups of the U.S. population, substantially

decreasing the numbers of individuals at likely risk for Pb-induced toxicities. Nevertheless,

estimates of the magnitude of potential public health impacts of Pb exposure can be substantial

for the U.S. population. For example, in estimating the effect of Pb exposure on intelligence, it

was projected that the fraction of individuals with an IQ >120 would decrease from ~9% with no

Pb exposure to less than 3% at a blood-Pb level of 10 μg/dL. Also, the fraction of individuals

with an IQ >130 points was estimated as being likely to decrease from 2.25% to 0.5% with a

blood-Pb level change from 0 to 10 μg/dL. In addition, an estimate of hypertension-related risk

for serious cardiovascular events (coronary disease, stroke, peripheral artery disease, cardiac

failure) indicates that a decrease in blood Pb from 10 to 5 μg/dL could result in an annual

decrease of 27 events per 100,000 women and 39 events per 100,000 men.

5.3.3 Environmental Effects of Lead

5.3.3.1 Terrestrial Ecosystems

Methodologies Used in Terrestrial Ecosystem Research

 Electron probe microanalysis (EPMA) techniques provide the greatest information on metal

speciation. Other techniques, such as EXAFS (extended X-ray absorption fine structure) and

EXANES (extended X-ray absorption near edge spectroscopy), show great promise and will be

important in solving key mechanistic questions.

 In situ methodologies have been developed to lower soil-Pb relative bioavailability. These

amendments typically fall within the categories of phosphate, biosolid, and Al/Fe/Mn-oxide

amendments. Some of the drawbacks to soil amendment include phosphate toxicity to plants and

increased arsenic mobility at high soil phosphate concentrations. The use of iron (III) phosphate

seems to mitigate arsenic mobility, however increased concentrations of phosphate and iron limit

their application when drinking water quality is a concern.

Distribution of Atmospherically Delivered Lead in Terrestrial Ecosystems

 Total Pb deposition during the 20th century has been estimated at 1 to 3 g Pb m-2, depending on

elevation and proximity to urban areas. Total contemporary loadings to terrestrial ecosystems are

~1 to 2 mg m-2year-1. This is a relatively small annual flux of Pb compared to the reservoir of

~0.5 to 4 g m-2of gasoline additive-derived Pb already deposited in surface soils over much of the

United States.

 Dry deposition can account for 10% to >90% of total Pb deposition. Because Clean Air Act

Legislation has preferentially reduced Pb associated with fine particles, relative contributions of

dry deposition have changed in the last few decades.

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 Although inputs of Pb to ecosystems are currently low, Pb export from watersheds via

groundwater and streams is substantially lower than inputs. Therefore, even at current input

levels, watersheds are accumulating anthropogenic Pb.

 Species of Pb delivered to terrestrial ecosystems can be inferred by emission source. For example,

Pb species emitted from automobile exhaust are dominated by particulate Pb halides and double

salts with ammonium halides (e.g., PbBrCl, PbBrCl2NH4Cl), while Pb emitted from smelters is

dominated by Pb-sulfur species. Halides from automobile exhaust break down rapidly in the

atmosphere, via redox reactions in the presence of atmospheric acids. Lead phases in the

atmosphere, and presumably the compounds delivered to the surface of the earth (i.e., to

vegetation and soils), are suspected to be in the form of PbSO4, PbS, and PbO.

 The importance of humic and fulvic acids and hydrous Mn- and Fe-oxides for scavenging Pb in

soils was discussed in some detail in the 1986 Lead AQCD. The importance of these Pb binding

substrates is reinforced by studies reported in the more contemporary literature.

 The amount of Pb that has leached into mineral soil appears to be on the order of 20 to 50% of the

total anthropogenic Pb deposition.

 The vertical distribution and mobility of atmospheric Pb in soils was poorly documented prior to

1986. Techniques using radiogenic Pb isotopes have been developed to differentiate between

gasoline-derived Pb and natural, geogenic (native) Pb. These techniques provide more accurate

determinations of the depth-distribution and potential migration velocities for atmospherically

delivered Pb in soils.

 Selective chemical extractions have been used extensively over the past 20 years to quantify

amounts of a particular metal phase in soil or sediment rather than total metal concentration.

However, some problems persist with the selective extraction technique: (a) extractions are rarely

specific to a single phase; and (b) in addition to the nonselectivity of reagents, significant metal

redistribution has been found to occur during sequential chemical extractions. Thus, although

chemical extractions provide some useful information on metal phases in soil or sediment, the

results should be treated as “operationally defined,” e.g., “H2O2-liberated Pb” rather than “organic

Pb.”

 Soil solution dissolved organic matter content and pH typically have very strong positive and

negative correlations, respectively, with the concentration of dissolved Pb species.

Effects of Lead on Natural Terrestrial Ecosystems

 Atmospheric Pb pollution has resulted in the accumulation of Pb in terrestrial ecosystems

throughout the world. In the United States, anthropogenically-derived Pb represents a significant

fraction of the total Pb burden in soils, even in sites remote from smelters and other industrial

plants. However, few significant effects of Pb pollution have been observed at sites that are not

near point sources of Pb.

 Evidence from precipitation collection and sediment analyses indicates that atmospheric

deposition of Pb has declined dramatically (>95%) at sites unaffected by point sources of Pb, and

there is little evidence that Pb accumulated in soils at these sites represents a threat to ground

water or surface water supplies.

 The effects of Pb and other chemical emissions on terrestrial ecosystems near smelters and other

industrial sites decrease downwind from the Pb source. Several studies using the soil burden as an

indicator have shown that much of the contamination occurs within a radius of 20 to 50 km

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around the emission source. Elevated metal concentrations around smelters have been found to

persist despite significant reductions in emissions. The concentrations of Pb in soils, vegetation,

and fauna at these sites can be two to three orders of magnitude higher than in reference areas.

Assessing the risks specifically associated with Pb is difficult, because these sites also experience

elevated concentrations of other metals and because of effects related to SO2 emissions. The

confounding effect of other pollutants makes the assessment of Pb-specific exposure-response

relationships impossible at the whole ecosystem level.

 In the most extreme cases, near smelter sites, the death of vegetation causes a near-complete

collapse of the detrital food web, creating a terrestrial ecosystem in which energy and nutrient

flows are minimal.

 More commonly, stress in soil microorganisms and detritivores can cause reductions in the rate of

decomposition of detrital organic matter. Although there is little evidence of significant

bioaccumulation of Pb in natural terrestrial ecosystems, reductions in microbial and detritivorous

populations can affect the success of their predators. Thus, at present, industrial point sources

represent the greatest Pb-related threat to the maintenance of sustainable, healthy, diverse, and

high-functioning terrestrial ecosystems in the United States.

Terrestrial Species Response/Mode of Action

 Plants take up Pb via their foliage and through their root systems. Surface deposition of Pb onto

plants may represent a significant contribution to the total Pb in and on the plant, as has been

observed for plants near smelters and along roadsides.

 There are two possible mechanisms (symplastic or apoplastic) by which Pb may enter the root of

a plant. The symplastic route is through the cell membranes of root hairs; this is the mechanism of

uptake for water and nutrients. The apoplastic route is an extracellular route between epidermal

cells into the intercellular spaces of the root cortex. The symplastic route is considered the

primary mechanism of Pb uptake in plants.

 Recent work supports previous conclusions that the form of metal tested, and its speciation in

soil, influence uptake and toxicity to plants and invertebrates. The oxide form of Pb is less toxic

than the chloride or acetate forms, which are less toxic that the nitrate form of Pb. However, these

results must be interpreted with caution, as the counter ion (e.g., the nitrate ion) may also be

contributing to the observed toxicity.

 Lead may be detoxified in plants by deposition in root cell walls, and this may be influenced by

calcium concentrations. Other hypotheses put forward recently include the presence of sulfur

ligands and the sequestration of Pb in old leaves as detoxification mechanisms. Lead

detoxification has not been studied extensively in invertebrates. Glutathione detoxification

enzymes were measured in two species of spider. Lead may be stored in waste nodules in

earthworms or as pyromorphite in the nematode.

 Lead effects on heme synthesis (as measured primarily by ALAD activity and protoporphyrin

concentration) were documented in the 1986 Lead AQCD and continue to be studied. However,

researchers caution that changes in ALAD and other enzyme parameters are not always related to

adverse effects, but may simply indicate exposure. Other effects on plasma enzymes, which may

damage other organs, have been reported. Lead also may cause lipid peroxidation, which may be

alleviated by vitamin E, although Pb poisoning may still result. Changes in fatty acid production

have been reported, which may influence immune response and bone formation.

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 Insectivorous mammals may be more exposed to Pb than herbivores, and higher trophic-level

consumers may be less exposed than lower trophic-level organisms. Nutritionally deficient diets

(including low calcium) cause increased uptake of Pb and greater toxicity in birds.

 Interactions of Pb with other metals are inconsistent, depending on the endpoint measured, the

tissue analyzed, the animal species, and the metal combination.

Exposure/Response of Terrestrial Species

 Recent critical advancements reported in the current Lead AQCD in understanding toxicity levels

relies heavily on the work completed by a multi-stakeholder group, consisting of federal, state,

consulting, industry, and academic participants, led by the EPA to develop Ecological Soil

Screening Levels (Eco-SSLs).

 Eco-SSLs are concentrations of contaminants in soils that would result in little or no measurable

effect on ecological receptors. The Eco-SSLs are intentionally conservative in order to provide

confidence that contaminants that could present an unacceptable risk are not screened out early in

the evaluation process. That is, at or below these levels, adverse effects are considered unlikely.

Due to conservative modeling assumptions (e.g., metal exists in most toxic form or highly

bioavailable form, high food ingestion rate, high soil ingestion rate) that are common to screening

processes, several Eco-SSLs are derived below the average background soil concentration for a

particular contaminant.

 The Eco-SSLs for terrestrial plants, birds, mammals, and soil invertebrates are 120, 11, 56, and

1700 mg Pb/kg soil, respectively.

5.3.3.2 Aquatic Ecosystems

Methodologies Used in Aquatic Ecosystem Research

 Many of the terrestrial methods can also be applied to suspended solids and sediments collected

from aquatic ecosystems. Just as in the terrestrial environment, the speciation of Pb and other

trace metals in natural freshwaters and seawater plays a crucial role in determining their

reactivity, mobility, bioavailability, and toxicity. Many of the same speciation techniques

employed for the speciation of Pb in terrestrial ecosystems are applicable in aquatic ecosystems.

 There is now a better understanding of the potential effects of sampling, sample handling, and

sample preparation on aqueous-phase metal speciation. Thus, a need has arisen for dynamic

analytical techniques that are able to capture a metal's speciation, in-situ and in real time.

 With few exceptions, ambient water quality criteria (AWQC) are derived based on data from

aquatic toxicity studies conducted in the laboratory. In general, both acute (short term) and

chronic (long term) AWQCs are developed. Depending on the species, the toxicity studies

considered for developing acute criteria range in length from 48 to 96 hours.

 Acceptable chronic toxicity studies should encompass the full life cycle of the test organism,

although for fish, early life stage or partial life cycle toxicity studies are considered acceptable.

Acceptable endpoints include reproduction, growth and development, and survival, with the

effect levels expressed as the chronic value.

 The biotic ligand model (BLM), which considers the binding of free metal ion to the site of toxic

action and competition between metal species and other ions, has been developed to predict the

toxicity of several metals under a variety of water quality conditions. However, there are

limitations to this tool in deriving AWQC because, currently, limited work has been conducted in

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developing chronic BLMs (for any metals, let alone Pb) and the acute BLMs to date do not

account for dietary metal exposures.

Distribution of Lead in Aquatic Ecosystems

 Atmospheric Pb is delivered to aquatic ecosystems primarily through deposition (wet and/or dry)

or through erosional transport of soil particles.

 A significant portion of Pb in the aquatic environment exists in the undissolved form (i.e., bound

to suspended particulate matter). The ratio of Pb in suspended solids to Pb in filtrate varies from

4:1 in rural streams to 27:1 in urban streams.

 The oxidation potential of Pb is high in slightly acidic solutions, and Pb2+ binds with high affinity

to sulfur-, oxygen-, and nitrogen-containing ligands. Therefore, speciation of Pb in the aquatic

environment is controlled by many factors (e.g., pH, redox, dissolved organic carbon, sulfides).

The primary form of Pb in aquatic environments is divalent (Pb2+), while Pb4+ exists only under

extreme oxidizing conditions. Labile forms of Pb (e.g., Pb2+, PbOH+, PbCO3) are a significant

portion of the Pb inputs to aquatic systems from atmospheric washout. Lead is typically present in

acidic aquatic environments as PbSO4, PbCl4, ionic Pb, cationic forms of Pb-hydroxide, and

ordinary Pb-hydroxide (Pb(OH)2). In alkaline waters, common species of Pb include anionic

forms of Pb-carbonate (Pb(CO3)) and Pb(OH)2.

 Lead concentrations in lakes and oceans were generally found to be much lower than those

measured in the lotic waters assessed by NAWQA. In open waters of the North Atlantic the

decline of Pb concentrations has been associated with the phasing out of leaded gasoline in North

America and Western Europe. However, in estuarine systems, it appears that similar declines

following the phase-out of leaded gasoline are not necessarily as rapid.

 Based on a synthesis of NAWQA data from the United States, Pb concentrations in surface

waters, sediments, and fish tissues (whole body) respectively range from: 0.04 to 30 μg/L (mean

= 0.66, median = 0.50, 95th %tile = 1.1); 0.5 to 12,000 mg/kg (mean = 120, median = 28, 95th

%tile = 200); and 0.08 to 23 mg/kg (mean = 1.03, median = 0.59, 95th %tile = 3.24).

Effects of Lead on Natural Aquatic Ecosystems

 Lead exposure may adversely affect organisms at different levels of organization, i.e., individual

organisms, populations, communities, or ecosystems. Generally, however, there is insufficient

information available for single materials in controlled studies to permit evaluation of specific

impacts on higher levels of organization (beyond the individual organism). Potential effects at the

population level or higher are, of necessity, extrapolated from individual level studies. Available

population, community, or ecosystem level studies are typically conducted at sites that have been

contaminated or adversely affected by multiple stressors (several chemicals alone or combined

with physical or biological stressors). Therefore, the best-documented links between Pb and

effects on the environment are with effects on individual organisms.

 Natural systems frequently contain multiple metals, making it difficult to attribute observed

adverse effects to single metals. For example, macro invertebrate communities have been widely

studied with respect to metals contamination and community composition and species richness. In

these studies, multiple metals were evaluated and correlations between observed community level

effects were ascertained. The results often indicate a correlation between the presence of one or

more metals (or total metals) and the negative effects observed. While, correlation may imply a

relationship between two variables, it does not imply causation of effects.

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 In simulated microcosms or natural systems, environmental exposure to Pb in water and sediment

has been shown to affect energy flow and nutrient cycling and benthic community structure.

 In field studies, Pb contamination has been shown to significantly alter the aquatic environment

through bioaccumulation and alterations of community structure and function.

 Exposure to Pb in laboratory studies and simulated ecosystems may alter species competitive

behaviors, predator-prey interactions, and contaminant avoidance behaviors. Alteration of these

interactions may have negative effects on species abundance and community structure.

 In natural aquatic ecosystems, Pb is often found coexisting with other metals and other stressors.

Thus, understanding the effects of Pb in natural systems is challenging given that observed effects

may be due to cumulative toxicity from multiple stressors.

Aquatic Species Response/Mode of Action

 Recent research has suggested that due to the low solubility of Pb in water, dietary Pb (i.e., Pb

adsorbed to sediment, particulate matter, and food) may contribute substantially to exposure and

toxicity in aquatic biota.

 Generally speaking, aquatic organisms exhibit three Pb accumulation strategies: (1) accumulation

of significant Pb concentrations with a low rate of loss, (2) excretion of Pb roughly in balance

with availability of metal in the environment, and (3) weak net accumulation due to very low

metal uptake rate and no significant excretion.

 Protists and plants produce intracellular polypeptides that form complexes with Pb. Macrophytes

and wetland plants that thrive in Pb-contaminated regions have developed translocation strategies

for tolerance and detoxification.

 Like aquatic plants and protists, aquatic animals detoxify Pb by preventing it from being

metabolically available, though their mechanisms for doing so vary. Invertebrates use lysosomalvacuolar systems to sequester and process Pb within glandular cells. They also accumulate Pb as

deposits on and within skeletal tissue, and some can efficiently excrete Pb. Fish scales and

mucous chelate Pb in the water column, and potentially reduce visceral exposure.

 Numerous studies have reported the effects of Pb exposure on blood chemistry in aquatic biota.

Plasma cholesterol, blood serum protein, albumin, and globulin concentrations were identified as

bioindicators of Pb stress in fish.

 Nutrients affect Pb toxicity in aquatic organisms. Some nutrients seem capable of reducing

toxicity. Exposure to Pb has not been shown to reduce nutrient uptake ability, though it has been

demonstrated that Pb exposure may lead to increased production and loss of organic material

(e.g., mucus and other complex organic ligands).

 Avoidance responses are actions performed to evade a perceived threat. Some aquatic organisms

have been shown to be quite adept at avoiding Pb in aquatic systems, while others seem incapable

of detecting its presence.

 The two most commonly reported Pb-element interactions are between Pb and calcium and

between Pb and zinc. Both calcium and zinc are essential elements in organisms and the

interaction of Pb with these ions can lead to adverse effects both by increased Pb uptake and by a

decrease in Ca and Zn required for normal metabolic functions.

Exposure/Response of Aquatic Species

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 The 1986 Lead AQCD reviewed data in the context of sublethal effects of Pb exposure. The

document focused on describing the types and ranges of Pb exposures in ecosystems likely to

adversely impact domestic animals. As such, the 1986 AQCD did not provide a comprehensive

analysis of the effects of Pb to most aquatic primary producers, consumers, and decomposers.

 Waterborne Pb is highly toxic to aquatic organisms, with toxicity varying with the species and

life stage tested, duration of exposure, form of Pb tested, and water quality characteristics.

 Among the species tested, aquatic invertebrates, such as amphipods and water fleas, were the

most sensitive to the effects of Pb, with adverse effects being reported at concentrations as low as

0.45 μg/L (range: 0.45 to 8000 μg/L).

 Freshwater fish demonstrated adverse effects at concentrations ranging from 10 to >5400 μg/L,

depending generally upon water quality parameters.

 Amphibians tend to be relatively Pb tolerant; however, they may exhibit decreased enzyme

activity (e.g., ALAD reduction) and changes in behavior (e.g., hypoxia response behavior).

5.3.3.3 Critical Loads for Lead in Terrestrial and Aquatic Ecosystems

 Critical loads are defined as threshold deposition rates of air pollutants that current knowledge

indicates will not cause long-term adverse effects to ecosystem structure and function. A critical

load is related to an ecosystem's sensitivity to anthropogenic inputs of a specific chemical.

 The critical loads approach for sensitive ecosystems from acidification has been in use throughout

Europe for about 20 years. Its application to Pb and other heavy metals in Europe is more recent.

European critical load values for Pb have been developed but are highly specific to the bedrock

geology, soil types, vegetation, and historical deposition trends in each European country. To

date, the critical loads framework has not been used for regulatory purposes in the United States

for any chemical. Considerable research is necessary before critical load estimates can be

formulated for ecosystems extant in the United States.

 Speciation strongly influences the toxicity of Pb in soil and water and partitioning between

dissolved and solid phases determines the concentration of Pb in soil drainage water, but it has

not been taken into account in most of the critical load calculations for Pb performed to date.

 Runoff of Pb from soil may be the major source of Pb into aquatic systems. However, little

attempt has been made to include this source into critical load calculations for aquatic systems

due to the complexity of including this source in the critical load models.

In summary, due to the deposition of Pb from past practices (e.g., leaded gasoline, ore smelting) and the

long residence time of Pb in many aquatic and terrestrial ecosystems, a legacy of environmental Pb

burden exists, over which is superimposed much lower contemporary Pb loadings. The potential for

ecological effects of the combined legacy and contemporary Pb burden to occur is a function of the

bioavailability or bioaccessibility of the Pb, which, in turn, is highly dependent upon numerous site

factors (e.g., soil organic carbon content, pH, water hardness). Moreover, while the more localized

ecosystem impacts observed around smelters are often striking, these perturbations cannot be attributed

solely to Pb. Many other stressors (e.g., other heavy metals, oxides of sulfur and nitrogen) can also act

singly or in concert with Pb to cause such notable environmental impacts.

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References:

Agency for Toxic Substances and Disease Registry (ATSDR). 1999. Toxicological profile for lead. U.S.

Department of Health and Human Services, Public Health Service.

http://www.atsdr.cdc.gov/toxprofiles/tp13.html

Center for the Child Care Workforce and Human Services Policy Center. 2002. "Estimating the Size and

Components of the U.S. Child Care Workforce and Caregiving Population: Key Findings from

the Child Care Workforce Estimate (Preliminary Report)," May 2002.

Clean Air Scientific Advisory Committee (CASAC) Lead Review Panel. 2007a. Letter to Stephen

Johnson. March 27, 2007. Available at:

http://yosemite.epa.gov/sab/sabproduct nsf/989B57DCD436111B852572AC0079DA8A/$File/casac07-003.pdf

Clean Air Scientific Advisory Committee (CASAC) Lead Review Panel. 2007b. Letter to Stephen

Johnson. September 27, 2007. Available at

http://yosemite.epa.gov/sab/sabproduct nsf/2DCD6EF49CDD37B285257364005F93E4/$File/casac07-007.pdf

Dietrich, K. M., et al. 2004. Effect of Chelation Therapy on the Neuropsychology and Behavioral

Development of Lead-Exposed Children After School Entry. Pediatrics, 114(1): 19-26.

Knight, TE, and Kumar, MS. 2003. Lead toxicosis in cats-a review. J Feline Med Surg. October 5,

(5):249-55.

Kowalczyk, DF. 1976. Lead poisoning in dogs at the University of Pennsylvania Veterinary Hospital. J

Am Vet Med Assoc., March 1, 168(5):428-32.

Liu, X., et al. 2002. Do Children with Falling Blood Lead Levels Have Improved Cognition? Pediatrics,

110(4): 787-791.

Mulligan, G.M., Brimhall, D., and West, J. (2005). Child Care and Early Education Arrangements of

Infants,Toddlers, and Preschoolers: 2001 (NCES 2006-039). U.S. Department of Education,

National Center for Education Statistics. Washington, DC: U.S. Government Printing Office.

Needleman, H. L.; Riess, J. A.; Tobin, M. J.; Biesecker, G. E.; Greenhouse, J. B. (1996) Bone Pb levels

and delinquent behavior. JAMA J. Am. Med. Assoc. 275: 363-369.

Rogan, W. J., et al. 2001. The effect of chelation therapy with succimer on neuropsychological

development in children exposed to lead. New England Journal of Medicine, 344(19): 1421-

1426.

Ruff, H. A., et al. 1993. Declining blood lead levels and cognitive changes in moderately lead-poisoned

children. The Journal of the American Medical Association, 269(13): 1641-1646.

Salkever, D. S. 1995. Updated estimates of earnings benefits from reduced exposure of children to

environmental lead. Environmental Research, 70(1): 1-6.

Stokes, L., et al. 1998. Neurotoxicity in young adults 20 years after childhood exposure to lead: the

Bunker Hill experience. Occupational Environmental Medicine, 55: 507-516.

U.S. Bureau of Labor Statistics. 2006. "Current Population Survey: Basic Monthly Survey." January

2006.

U.S. Census Bureau. 2003. American Housing Survey (AHS).

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U.S. Department of Education. 2005. National Center for Education Statistics Early Childhood Program

Participation Survey (NCES 2006-075). Washington, DC.

(http://nces.ed.gov/nhes/dataproducts.asp#2005dp)

U.S. Environmental Protection Agency (EPA). 1997. Exposure Factors Handbook. Office of Research

and Development, National Center for Environmental Assessment. EPA/600/P-95/Fa, Fb, and

Fc.

U.S. Environmental Protection Agency (EPA). 2004. IRIS Database for Risk Assessment. Office of

Research and Development, National Center for Environmental Assessment. Updated July 8,

2004. http://www.epa.gov/iriswebp/iris/index html

U.S. Environmental Protection Agency (EPA). 2006a. Economic Analysis for the Renovation, Repair,

and Painting Program Proposed Rule, February 2006.

U.S. Environmental Protection Agency (EPA). 2006b. Air Quality Criteria for Lead (Final).

EPA/600/R-5/144aF. Office of Research and Development. October.

http://cfpub.epa.gov/ncea/cfm/recordisplay.cfm?deid=158823

U.S. Environmental Protection Agency (EPA). 2007. Revised Final Report on Characterization of Dust

Lead Levels after Renovation, Repair, and Painting Activities. Prepared by Battelle (Columbus,

OH) for the Office of Pollution Prevention and Toxics (Washington, D.C.). November 13, 2007.

U.S. Environmental Protection Agency (EPA). 2008a. Child-Specific Exposure Factors Handbook. Office

of Research and Development, National Center for Environmental Assessment. EPA/600/R0/096F. September 2008.

U.S. Environmental Protection Agency (EPA). 2008b. Economic Analysis for the TSCA Lead

Renovation, Repair, and Painting Program Final Rule for Target Housing and Child-Occupied

Facilities. April 2008.

Wilder Research Center. 2005. "Family, Friend and Neighbor Caregivers: Results of the 2004 Minnesota

statewide household child care survey." December 2005.

Wilder Research Center. 2001. "Staff recruitment and retention in early childhood care and education and

school-age care." April 2001.

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Chapter 6 6-1

6. Estimated Impacts of the Lead, Renovation, Repair, and Painting

Rule Revisions

In addition to the cost and benefit analyses presented in Chapters 4 and 5, several other types of impacts

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

impact of the proposed revisions to the Lead Renovation, Repair and Painting (LRRP) Rule on:

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

 Financial condition of small entities, as required by the Regulatory Flexibility Act (RFA)

 Whether the regulation has a disproportionate effect on low-income and or minority persons

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

Executive Order 13045–Protection of Children From Environmental Health & Safety Risks

 State, local, and Tribal governments, and the private sector, as required by Executive Order

13175–Consultation and Coordination with Indian Tribal Governments

 Federalism, as required by Executive Order 13132–Federalism

 The relationship between the Federal government and the Indian tribes, or on the distribution of

power and responsibilities between the Federal government and Indian tribes

 Energy effects, as required by Executive Order 13211–Actions That Significantly Affect Energy

Supply, Distribution, or Use and

 Whether voluntary consensus standards are used in its regulatory activities.

The proposed LRRP Clearance Rule includes the following changes to the LRRP program: (1) a

requirement for dust wipe testing for a subset of renovation activities, and (2) a requirement for dust wipe

testing and clearance for a subset of renovation activities where the quantity and characteristics of the dust

make it hard to clean up. The demand for certified dust sampling technicians is predicted to increase as a

result of the implementation of the Clearance Rule provision, and therefore more individuals are expected

to seek dust sampling technician training. Additionally, a specific set of events already regulated under

the 2008 LRRP Rule will incur additional per-event dust wipe testing and clearance costs.

6.1 Paperwork Reduction Act

The Paperwork Reduction Act of 1995 (PRA) (superseding the PRA of 1980), as implemented by the

Office of Management and Budget (OMB), requires that agencies submit a supporting statement to OMB

for any information collection that solicits the same data from more than nine parties. The PRA seeks to

ensure that Federal agencies balance their need to collect information with the paperwork burden imposed

on the public by the collection.

The definition of “information collection” includes activities required by regulations such as permit

development, monitoring, recordkeeping, and reporting. The term “burden” refers to the “time, effort, or

financial resources” the public expends to provide information to or for a Federal agency, or to otherwise

fulfill statutory or regulatory requirements. PRA paperwork burden is measured in terms of annual time

and financial resources the public devotes to meet one-time and recurring information requirements (44

U.S.C. 3502(2); 5 C.F.R. 1320.3(b)).

Information collection activities may include:

 reviewing rule requirements;

 using technology to collect, process, and disclose information;

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 adjusting existing practices to comply with requirements;

 searching data sources;

 recordkeeping;

 completing and reviewing the response; and

 transmitting or disclosing information.

Agencies must provide information to OMB on the parties affected, the annual reporting burden, and the

annualized cost associated with responding to information collection requirements.

The proposed LRRP Clearance Rule would result in additional paperwork-related burden for the three

types of entities:

1. The dust sampling technician would be required to collect dust samples, prepare a dust wipe

testing report, and provide it to the renovation firm (Section 6.1.1). (In instances where the

renovator is also the dust sampling technician, this item and the following one would be

combined.)

2. Renovation firms would be required to provide copies of the dust wipe testing report to owners

and occupants.

3. Training providers would incur additional paperwork burden related to course accreditation and

notification (Section 6.1.2).

6.1.1 Paperwork Burden and Costs for Dust Wipe Testing Report

The proposed LRRP Clearance Rule would require the certified dust sampling technician to prepare a

dust wipe testing report and provide it to the renovation firm within three days of the date that the dust

wipe test results are obtained. If the dust wipe test results are to be determined by a fixed-site laboratory,

the samples have to be sent to the laboratory within one business day of the date they are collected. The

dust wipe testing or clearance report would include the name and signature of each certified person

collecting the samples or performing the testing, the name and address of each certified firm employing

the persons conducting the sampling or testing, the start and completion dates of the renovation, a brief

written description of the renovation, the results of the visual inspection, a detailed written description of

the specific sampling or testing locations or a detailed drawing that clearly identifies the location of each

sample or test, the name of the NLLAP-recognized entity analyzing the results, the results of each sample

or test, and the clearance standard that is applicable to each sample or test.

6.1.1.1 Number of Firms Performing Dust Wipe Testing and Clearance Events

As discussed in Section 4.4, there are 223,821 entities performing events requiring dust wipe testing or

clearance in residential housing during the first year of the rule. It is estimated that firms working in

public and commercial building child-occupied facilities will perform one event that requires dust wipe

testing or clearance per year. The number of child-occupied facilities using in-house staff to perform

these types of events is estimated to be 686 in the first year of the rule. There will be an estimated 448

events performed by non-residential contractors in year 1. Table 6-1 presents the total number of firms

expected to incur paperwork burden and costs due to the proposed rule.

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Chapter 6 6-3

6.1.1.2 Paperwork Burden and Unit Costs

Two types of costs are estimated in this analysis:

 Labor costs associated with collecting dust wipe samples, shipping samples to the lab, preparing

the dust wipe testing or clearance report, and providing reports to owners and occupants of

structures where dust wipe testing or clearance was performed.

 Material costs associated with collecting, shipping, and analyzing dust wipe samples, and

photocopying and mailing the report.

Labor Costs

The lead evaluation firm survey of nine establishments described in Chapter 4 asked respondents how

much labor time would be necessary for taking four dust wipe samples, sending them to the lab, and

providing a report to the contractor. The average response was 1.75 hours. Subtracting the estimated

marginal labor time for four samples (0.19 hours per sample; see Section 4.3.3) and the assumed labor

time for shipping results (0.083 hours), the average labor time for writing a short report as described

above would be 0.9 hours, or 54 minutes. Thus, EPA estimates that dust sampling technicians will spend

an average of 0.83 hours during each sampling event collecting samples (based on a typical time of 0.19

hours per sample), about 0.9 hours preparing the report, and renovators will spend about five minutes

shipping samples or reports, for an average renovation firm burden of 1.8 hours per event.

The burden attributed to renovation firms includes the time required to perform the dust sampling, ship

the samples to the laboratory, and prepare and send a summary report to the necessary parties. All

renovation firms are required to provide a copy of the dust wipe testing report to the owner and if

different, the occupant of the building being renovated or the operator of the child-occupied facility.

EPA assumes that renovation firms working in residential housing will have certified dust sampling

technicians on staff to perform the dust sampling and report preparation activities. Residential contractors

are estimated to perform an average of 7 renovations per year where dust wipe testing will be required,

with an average burden of 1.8 hours per event.

Entities performing work in public and commercial building child-occupied facilities are expected to hire

third-party lead evaluation firms to perform dust sampling. Therefore, these entities will only incur a

labor burden of 5 minutes for shipping the dust sampling report to owners and occupants. The cost of

hiring a third-party firm is accounted for as a material cost.

Material Costs

In addition to the time needed to collect dust wipe samples, ship them to the lab, and prepare and mail a

summary report, entities performing RRP events will also incur the costs of the lab analysis, dust wipe

sample materials, shipping charges, and report materials. Based on a survey of nine establishments, EPA

Table 6-1: Total Number of Firms Performing Events Requiring Dust Wipe Testing or

Clearance

Year 1 Year 2 Year 3

Number of Affected Firms

Residential Contractors 223,821 222,903 221,989

Public and Commercial Building Operators a686 683 680

Non-Residental Contractors b448 446 444

Total - All Events 224,955 224,032 223,113

a RRP is performed by the owner of a public or commercial building where a COF is located

b RRP is performed by a contractor in a public or commercial building where a COF is located

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Chapter 6 6-4

estimates a lab cost of $19.00 per sample. EPA estimates the cost of the dust wipes to be $0.25 per wipe.

Based on per-page photocopy costs, EPA estimates that a single copy of the dust wipe testing report

(assumed to average four pages in length, accounting for a one page job description, one page of lab

results, one page for a diagram of sample locations, and one additional page to account for the instances

where more than three pages might be necessary, such as a renovation event occurring in multiple rooms)

costs $0.36. EPA estimates a shipping cost of $4.95 based on the rate for Priority Mail using the U.S.

Postal Service. After events requiring clearance to be achieved, EPA assumes renovation firms will send

reports via overnight mail; EPA estimates the overnight shipping cost to be $15.68.

EPA assumes that renovation firms working in residential housing will have certified dust sampling

technicians on staff to perform the dust sampling and report preparation activities. Entities performing

work in public and commercial building child-occupied facilities are expected to hire third-party lead

evaluation firms to perform dust sampling. Therefore, these entities will incur labor costs associated with

sending the dust sampling report to building owners and operators, whereas the cost of hiring a third-party

firm is accounted for as a material cost.

Because the written report labor time, shipping labor time, and paper copy and shipping material costs of

clearance events are all dependent upon the expected number of clearance failures, per-event paperwork

burden estimates must be calculated separately for each size and type of event, as described in the cost

analysis in Chapter 4. Table 6-2 presents the average per-entity burden and the total labor burden on

firms to comply with the proposed Clearance Rule. Table 6-3 presents the average labor, material, and

total per-entity costs.

Table 6-2: Total Paperwork Burden

Year 1 Year 2 Year 3

Average Burden Hours per Response

Residential Contractors 1.80 1.80 1.80

Public and Commercial Building Operators a0.08 0.08 0.08

Non-Residential Contractors b0.08 0.08 0.08

All Firms 1.80 1.80 1.80

Total Burden Hours

Residential Contractors 2,878,970 2,867,166 2,855,411

Public and Commercial Building Operators a57 57 57

Non-Residential Contractors b37 37 37

Total - All Events 2,879,064 2,867,260 2,855,505

a RRP is performed by the owner of a public or commercial building where a COF is located

b RRP is performed by a contractor in a public or commercial building where a COF is located

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Chapter 6 6-5

6.1.1.3 Total Paperwork Costs for RRP Establishments

The proposed LRRP Clearance Rule would apply to establishments affected by the 2008 LRRP rule and

to establishments predicted to seek certification as a result of the proposed elimination of the opt-out

provision. Under the proposed option, the entire stock of construction firms working in target housing

necessary to meet demand would incur dust wipe testing and clearance costs starting in the first year.

Other entities doing RRP in public and commercial building COFs, such as public schools, private

schools, daycare centers, non-residential property managers and lessors, and non-residential contractors

would also be affected by the proposed LRRP Clearance Rule. Given the relative infrequency of dust

wipe testing and clearance events in public and commercial buildings, entities working in public and

commercial building COFs are not expected to perform more than one activity requiring dust wipe testing

or clearance per year. Therefore, the number of affected entities is estimated as the number of buildings

with a renovation event requiring dust wipe testing or clearance in the first year.

Per-establishment paperwork costs and per-establishment paperwork burdens (defined as the total number

of hours spent complying with paperwork requirements associated with the proposed rule) were estimated

by dividing the total costs and burden by the number of certified entities expected to be affected by the

proposed LRRP Clearance Rule. Table 6-4 through Table 6-6 present these final per-entity values

separately for residential construction firms, non-residential contractors, and entities performing RRP in

public and commercial building COFs.

Table 6-3: Average Paperwork Cost Per Entity

Year 1 Year 2 Year 3

Average Labor Cost per Entity

Residential Contractors $449 17 $449 17 $449 17

Public and Commercial Building Operators a$2.91 $2.91 $2.91

Non-Residential Contractors b$2.91 $2.91 $2.91

All Firms $446 92 $446 92 $446 92

Average Material Cost per Entity

Residential Contractors $674 30 $674 30 $674 30

Public and Commercial Building Operators a$493 35 $493 35 $493 35

Non-Residential Contractors b$480 27 $480 27 $480 27

All Firms $673 36 $673 36 $673 36

Total Cost per Entity

Residential Contractors $1,123.47 $1,123.47 $1,123.47

Public and Commercial Building Operators a$496 26 $496 26 $496 26

Non-Residential Contractors b$483 18 $483 18 $483 18

Total - All Firms $1,120.28 $1,120.28 $1,120.28

a RRP is performed by the owner of a public or commercial building COF

b RRP is performed by a contractor in a public or commercial building COF

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Chapter 6 6-6

6.1.2 Training Provider Paperwork Burden and Costs

EPA has also estimated the information collection burden imposed on training providers. Additional

training providers are estimated to become accredited as a result of the LRRP Clearance Rule; therefore,

there will be incremental paperwork burden for accreditation and re-accreditation. Further, since the

proposed LRRP Clearance Rule implies an increase in dust sampling training course demand, it is

estimated that training providers would incur an incremental paperwork burden related to course

notification. To comply with the 2008 LRRP rule, training providers must keep records on both the

courses they provide and the students they train. In addition, they must notify EPA before offering each

course (to facilitate EPA’s enforcement activities) and after each course (so EPA has a record of the

individuals who have completed the course).

Table 6-4: Residential Contractor Per-Establishment Paperwork Costs, by Year

Total

Paperwork

Costsa

Total

Paperwork

Burden

(hours)

Number of

Certified

Residential

RRP Firmsb

Per-Estab.

Paperwork

Burden

(hours)

Per-Estab.

Labor Cost

Per-Estab.

Material Cost

Per-Estab.

Total

Paperwork

Cost

Year 1

$251,456,179 2,878,970 223,821 13 $449 $674 $1,123

Year 2

$250,424,833 2,867,166 222,903 13 $449 $674 $1,123

Year 3

$249,397,982 2,855,411 221,989 13 $449 $674 $1,123

Table 6-5: Public and Commercial Building COF Operator Per-Entity Paperwork Costs, by Year

Total

Paperwork

Costs

Total

Paperwork

Burden

(hours)

Number of

Certified

Entities

Per-Estab.

Paperwork

Burden

(hours)

Per-Estab.

Labor Cost

Per-Estab.

Material Cost

Per-Estab.

Total

Paperwork

Cost

Year 1

$340,434 57 686 0.08 $3 $493 $496

Year 2

$339,039 57 683 0.08 $3 $493 $496

Year 3

$337,649 57 680 0.08 $3 $493 $496

Table 6-6: Non-Residential Contractor Per-Establishment Paperwork Costs, by Year

Total

Paperwork

Costs

Total

Paperwork

Burden

(hours)

Number of

Certified

Entities

Per-Estab.

Paperwork

Burden

(hours)

Per-Estab.

Labor Cost

Per-Estab.

Material Cost

Per-Estab.

Total

Paperwork

Cost

Year 1

$216,465 37 448 0.08 $3 $480 $483

Year 2

$215,577 37 446 0.08 $3 $480 $483

Year 3

$214,693 37 444 0.08 $3 $480 $483

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Chapter 6 6-7

6.1.2.1 Burden Associated with Course Accreditation

It is assumed that 168 training providers, the approximate number accredited to provide lead abatement

training, will be accredited to provide dust sampling technician training. As described in Section 2.9.1 of

the Economic Analysis for the Final Rule, 94 percent of firms in the Other Technical and Trade Schools

industry category are small businesses (EPA 2008). Therefore, it is assumed that 94 percent of the 168

training providers, or 158, are small. It is assumed that Training Providers will spend eight hours1

familiarizing themselves with the rule and determining the rule’s applicability to their services in the year

that they receive initial accreditation. Training providers will spend an additional four hours of

professional time and two hours of clerical time completing the accreditation statement in the year they

receive initial accreditation, and every three years thereafter for re-accreditation. They will spend one

additional hour of clerical time each year on annual recordkeeping associated with accreditation.

Table 6-7 presents the estimation of training provider burden for accreditation. In year 1, it is assumed

that 168 training providers will seek initial accreditation. For each year thereafter, one quarter of the

necessary stock of training providers will seek accreditation. Based on EPA’s Federal Lead-Based Paint

Program (FLPP) database, fifty-five percent of that quarter will seek initial accreditation, and the

remainder will seek re-accreditation. In addition, the necessary stock of training providers will diminish

by 0.41 percent, annually, to reflect the estimated housing demolition rate.

1 Time assumptions are based on information provided in EPA’s (2005) Supporting Statement for OMB Review under The

Paperwork Reduction Act TSCA Sections 402/404 Training, Certification, Accreditation and Standards for Lead-Based

Paint Activities. (EPA ICR No. 1715.09, OMB Control No 2070-0155).

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Chapter 6 6-8

Table 6-7: Training Providers: Accreditation Burden Estimates

Number of Training Providers

Year 1 Year 2 Year 3

Receiving Initial Accreditation 168 23 23

Receiving Re-Accreditation 0 19 19

Already Accredited 0 125 124

Total 168 167 166

Accreditation/Re-Accreditation Burden- Hours per Training Provider

Accreditation

Year

ReAccreditation

Year Other Years

Rule Familiarization 8 0 0

Accreditation Statement 4 4 0

Clerical Time- Statement 2 2 0

Clerical Time- Recordkeeping 1 1 1

Total 15 7 1

Total Accreditation Burden- Hours

Year 1 Year 2 Year 3

Rule Familiarization 1,344 184 184

Accreditation Statement 672 168 168

Clerical Time- Statement 336 84 84

Clerical Time- Recordkeeping 168 167 166

Total 2,520 603 602

Sources Economic Analysis for the Final Rule (EPA 2008).

6.1.2.2 Costs Associated with Course Accreditation

The loaded wage rate for training provider clerical staff is $25.56 per hour. The loaded wage rate for

professional training staff is $48.67 per hour. It is assumed that professional staff will familiarize

themselves with the rule and will prepare the accreditation statement. Material costs of accreditation

include one postage stamp ($0.42), one envelope ($0.02), and two copies ($0.18). Table 6-8 presents the

total costs associated with training provider course accreditation.

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Chapter 6 6-9

6.1.2.3 Burden Associated with Notification Requirements

It is assumed that the pre-notification for each class requires an average of 0.15 hours and that each postnotification requires 1.54 hours. The post notifications are more time consuming because the training

provider must send records pertaining to each student who attended the course. Approximately 12

percent of courses will also require a re-notification, which is also estimated to take 0.15 hours. These

activities add up to an average of 1.7 clerical hours per course. The number of courses offered per year

depends on the number of individuals who need to be trained. As the proposed 2009 LRRP Clearance

Rule would increase the demand for dust wipe testing and clearance services, 223,821 dust sampling

technicians are predicted to seek training in the first year and 44,581 in the second year. It is assumed

that training providers would offer an extra 53 courses in the first year, or a total of 158 hours, for the

added dust sampling technician demand.2It is assumed that each notification requires one photocopy,

one envelope, and one stamp; thus approximately two of each of these items are required per course.

Table 6-9 and Table 6-10 present the burden incurred by training providers due to the notification

requirements.

2 This assumes an average class size of 25.

Table 6-8: Training Providers: Accreditation Cost Estimates

Number of Training Providers

Year 1 Year 2 Year 3

Receiving Initial Accreditation 168 23 23

Receiving Re-Accreditation 0 19 19

Already Accredited 0 125 124

Total 168 167 166

Accreditation/Re-Accreditation Cost per Training Provider

Accreditation

Year

ReAccreditation

Year Other Years

Rule Familiarization $389.34 $0.00 $0.00

Accreditation Statement $194.67 $194.67 $0.00

Clerical Time- Statement $51 11 $51.11 $0.00

Clerical Time- Recordkeeping $25 56 $25.56 $25.56

Material Costs $0.62 $0.62 $0.00

Total Cost $661.30 $271.96 $25.56

Total Accreditation Cost – 2008 Dollars

Year 1 Year 2 Year 3

Rule Familiarization $65,409 $8,955 $8,955

Accreditation Statement $32,705 $8,176 $8,176

$8,586 $2,147 $2,147

Clerical Time- Recordkeeping $4,294 $4,269 $4,243

Material Costs $104 $26 $26

Total $111,098 $23,572 $23,547

Sources Economic Analysis for the Final Rule (EPA 2008).

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Chapter 6 6-10

Table 6-10: Training Providers: Notification Burden Estimates

Year 1 Year 2 Year 3

Burden per Training Provider 158 33 33

Number of Training Providers 168 167 166

Total Burden Hours 26,527 5,473 5,440

Note(s) Numbers may not calculate due to rounding.

6.1.2.4 Costs Associated with Notification Requirements

Clerical staff will prepare and mail notifications and will perform recordkeeping activities. The loaded

wage rate for training provider clerical staff is $25.56 per hour. Training provider notification costs also

include $0.42 per postage stamp and $0.02 per envelope for mailing notifications and $0.09 per one page

copy of each notification for the firm’s records. Training providers are also required to take a digital

photo of each dust sampling technician receiving certification. The use of a one-time digital camera costs

$20.58 per 25 photos3and takes approximately three minutes per photo or 1.25 hours per 25 photos.

Table 6-11 and Table 6-12 present the costs incurred by training providers due to the notification

requirements.

3 The analysis assumes a total cost of $2.00 per photo; adjusted for inflation, this equates to a material cost of $19.91 for 25

photos.

Table 6-9: Training Providers: Notification Burden

Category Events per Training Provider

Year 1 Year 2 Year 3 Avg.

Reporting

Hours/Event

Recordkeeping

Hours/Event

Total

Hours/Event

Pre-notification 53 11 11 25 0.15 0.01 0.16

Re-notification 6 1 1 3 0.15 0.01 0.16

Post-notification 53 11 11 25 1.54 0.01 1.55

Digital Photo 53 11 11 25 1.25 0.00 1.25

Annual Total 165 34 34 78

Note(s) Numbers may not calculate due to rounding.

Table 6-11: Training Providers: Notification Cost per Event

Category Events per Training Provider

Year 1 Year 2 Year 3 Avg.

Reporting

Cost/Event

Recordkeeping

Cost/Event

Materials

Cost/Event

Total

Cost/Event

Pre-notification 53 11 11 25 $3.83 $0.26 $0.53 $4.62

Re-notification 6 1 1 3 $3.83 $0.26 $0.53 $4.62

Post-notification 53 11 11 25 $39.36 $0.26 $0.53 $40.14

Digital Photo 53 11 11 25 $31.94 $0.00 $19.91 $52.00

Annual Total 53 11 11 25 $3.83 $0.26 $0.53 $4.62

Note(s) Numbers may not calculate due to rounding.

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Chapter 6 6-11

Table 6-12: Training Providers: Notification Cost Estimates

Year 1 Year 2 Year 3

Burden per Training Provider $5,158 $1,070 $1,070

Number of Training Providers 168 167 166

Total Burden Hours $866,487 $178,767 $177,696

Note(s) Numbers may not calculate due to rounding.

6.1.2.5 Total Paperwork Costs for Training Providers

As shown in Table 6-13, the incremental cost to training providers in the first year is approximately $1.0

million. Costs to training providers would be approximately $0.2 million in years 2 and 3.

Table 6-13: Total Cost Incurred by Training Providers

Year 1 Year 2 Year 3

Accreditation Cost $111,098 $23,572 $23,547

Notification Cost $866,487 $178,767 $177,696

Total Cost $977,586 $202,339 $201,243

Note(s) Numbers may not calculate due to rounding.

6.1.3 Agency Burden and Cost

There are also government costs to administer the program. States, Tribes, and Territories are allowed,

but are under no obligation, to apply for and receive authorization to administer these requirements. EPA

will directly administer programs for States, Tribes, and Territories that do not become authorized.

Because the number of States, Tribes, and Territories that will become authorized is not known,

administrative costs are estimated assuming that EPA will administer the program everywhere. To the

extent that other government entities become authorized, EPA’s administrative costs will be lower.

States, Tribes, and Territories that choose to implement the rule themselves are expected to incur similar

costs on a per-unit basis.

EPA will incur costs to process training provider accreditations and notifications for dust sampling

technician training. To reduce the burden on the regulated community, EPA does not require formal

certification for dust sampling technicians (this cost is implicit in the fee charged to renovation firms).

However, EPA will incur incremental costs of contractor support and database maintenance as a result of

the increase in dust sampling technician certification.

For the purpose of estimating costs, it is assumed that EPA Regions will incur variable processing costs,

and fixed administrative and enforcement costs. Regional administrative activities include answering

phone inquires from the public regarding the LRRP program, following up on the status of applications,

providing information to other regions, coordinating with headquarters, and performing other customer

service activities. Enforcement activities include conducting audits of training providers and firms. In

addition, it is assumed that EPA Headquarters will incur fixed administrative costs related to coordination

with regions and maintenance of the central database and registry. EPA Headquarters will also support

enforcement activities.

Accreditation cost estimates are based on responses from a Time-Motion Study conducted in support of

the 2009 Economic Analysis for the TSCA section 402 Lead-Based Paint Program Accreditation and

Certification Fee Rule (i.e., the Fee Rule). In the Time-Motion Study, data were collected from three

EPA Regions: Region 2, Region 4, and Region 9. Regions were asked to provide the number of hours

and personnel required to process applications under the TSCA section 402(a) Lead-Based Paint

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Chapter 6 6-12

Activities program (i.e., the Abatement Rule). While TSCA section 402(a) defines training and

certification requirements for five different categories of lead abatement professionals, the type of

administrative activities associated with the TSCA section 402(a) rule are similar to those expected for

the Renovation, Repair and Painting Rule. See the 2009 Fee Rule for an in-depth explanation of fee

structure methodology and calculations.

6.1.3.1 Agency Costs of Accrediting Training Providers

To estimate cost of processing accreditation applications for the LRRP rule, EPA followed the approach

used to estimate these costs for the Abatement rule. To estimate these costs, EPA first considered the

variable and fixed costs associated with each applicant type. The variable costs reflect the regional

processing costs for each application type. The fixed costs include the regional and headquarters

administrative and enforcement costs, which apply across all the applications. EPA divided the total

regional enforcement and administrative costs and the headquarters costs by the total estimated number of

applicants over the five year projection period for the 2008 LRRP Rule.

Table 6-14 presents the Agency cost per training provider developed in the Economic Analysis for the

Fees Rule.

Table 6-14: Fee Schedule for Accrediting Training Providers

Calculated Fee Actual Fee

Estimated Initial Accreditation $558 $560

Estimated Re-Accreditation $398 $400

Sources The Economic Analysis for the TSCA section 402 Lead-Based Paint

Program Accreditation and Certification Fee Rule (EPA 2009)

As described above, it is estimated that 168 training providers would become accredited in Year 1. In

Year 2, 42 training providers are expected to seek accreditation or re-accreditation, and in Year 3, 42

training providers are expected to be accredited or re-accredited. As shown in Table 6-15, based on these

estimates, it will cost EPA less than $0.1 million to process dust sampling technician notifications in Year

1. EPA’s costs for notification processing are estimated to approximately $20,500 in Years 2 and 3.

Table 6-15: Total EPA Costs of Training Provider Accreditations

Year 1 Year 2 Year 3

Initial Accreditation 168 23 23

Re-Accreditation 0 19 19

Total Cost of Accreditation $94,080 $20,480 $20,480

Note(s): Numbers may not calculate due to rounding.

Sources Analysis for Clearance Proposed Rule (EPA 2010); The Economic Analysis for the

TSCA section 402 Lead-Based Paint Program Accreditation and Certification Fee Rule (EPA

2009)

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Chapter 6 6-13

6.1.3.2 Agency Cost of Processing Training Notifications

EPA will incur the cost of processing notifications submitted by training providers prior to and following

each course session. It is assumed that EPA technical staff with a fully loaded hourly wage of $36.914

will spend an average of two minutes processing each notification.

It is estimated that there will be 18,876 training notifications in Year 1, 3,894 in Year 2, and 3,871 in

Year 3. As shown in Table 6-16 it will cost EPA $23,226 to process training notifications in the first year

of the rule, $4,792 in Year 2, and $4,763 in Year 3.

Table 6-16: Total EPA Cost of Training Notifications – 2008 Dollars

Year 1 Year 2 Year 3

Process Training Notification $23,226 $4,792 $4,763

Note(s): Numbers may not calculate due to rounding.

Sources Economic Analysis for the Clearance Proposed Rule (EPA 2010); U.S. Office of

Personnel Management 2008 General Schedule - Base Annual (OPM 2008).

6.1.3.3 Agency Costs of Certifying Dust Sampling Technicians

Under the 2008 LRRP Rule, dust sampling technicians are not required to apply to EPA for formal

certification. However, EPA Headquarters will incur administrative costs related to contract support and

maintenance of the central database and registry. EPA estimates the contractor support cost to be $5 per

dust sampling technician notification. Central database maintenance, which is a fixed cost, is spread

across all dust sampling technicians.

To estimate the costs of processing notifications for the LRRP rule, EPA followed the approach used to

estimate the costs of processing notifications for the Abatement rule. To estimate these costs EPA

considered both the variable and fixed costs associated with each applicant type. The variable costs

reflect the regional processing costs for each application type. The fixed costs include the regional and

headquarters administrative and enforcement costs, which apply across all the applications. EPA divided

the total regional enforcement and administrative costs and the headquarters costs by the total estimated

number of applicants over the five year period that the training is valid.

Fixed costs for sampling technicians were estimated by dividing the headquarters administrative costs by

the total number of applicants over the five year period that the training is valid to obtain an estimated

cost of $65. As sampling technicians are not required to obtain formal certification, their costs are

recouped by the fee charged to RRP firms. See the 2009 Fee Rule for an in-depth explanation of fee

structure methodology and calculations. Table 6-17 presents the Agency cost per dust sampling technician

developed in the Economic Analysis for the Fees Rule.

4 EPA used the Office of Personnel Management’s General Salary Table 2008-GS to estimate government employee wage rates.

EPA used the wage for a GS-11, Step 1 employee and loaded the wage using the standard government multiplier of 1.6 to

cover overhead and fringe benefits.

5

See Economic Analysis for the TSCA Section 402 Lead-Based Paint Program Accreditation and Certification Fee Rule (EPA,

2009).

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Chapter 6 6-14

Table 6-17: EPA Costs for Processing Dust Sampling Technician

Notifications

Total Cost

Estimated Cost Per Initial Training $6

Estimated Cost Per Refresher Training $6

Sources The Economic Analysis for the TSCA section 402 Lead-Based Paint

Program Accreditation and Certification Fee Rule (EPA 2009)

It is estimated that 223,821 dust sampling technicians would become certified in Year 1. In Year 2,

44,581 technicians are expected to seek certification or re-certification, and in Year 3, 44,398 technicians

are expected to be certified or re-certified. As shown in Table 6-18, based on these estimates, it will cost

EPA $1.3 million to process dust sampling technician notifications in Year 1. EPA’s costs for

notification processing are estimated to be less than $0.3 million in Years 2 and 3.

Table 6-18: Total EPA Costs of Dust Sampling Technician Notifications

Year 1 Year 2 Year 3

Number of Dust Sampling Technicians 223,821 44,581 44,398

Total Cost $1,342,926 $267,486 $266,388

Note(s): Numbers may not calculate due to rounding.

Sources Analysis for Clearance Proposed Rule (EPA 2010); The Economic Analysis for the

TSCA section 402 Lead-Based Paint Program Accreditation and Certification Fee Rule (EPA

2009)

6.1.4 Total Paperwork Burden and Costs for RRP Firms and Training Providers

Table 6-19 presents the estimated total paperwork burden and costs incurred by all RRP firms and

training providers in each of the first three years of the proposed revisions’ implementation. The Agency

estimated that approximately 224,200 entities would be affected by the proposed LRRP Clearance Rule

annually. EPA estimated the total annualized burden of the information collection activities due to the

proposed rule at 2.9 million hours.

For training providers, total notification and accreditation burden was estimated by multiplying the perentity burden estimates in Table 6-8 and Table 6-9 by the number of training providers in each year. For

entities performing RRP in target housing and public and commercial building COFs, total reporting

burden was estimated by multiplying the per-establishment burden estimates by the number of

establishments affected in each year. For the rule requirements, a total event paperwork burden was first

estimated by multiplying the number of events discussed in Chapter 4 by the total hours spent per-event

complying with the paperwork requirements of the proposed Clearance Rule in each year. Next, the total

event paperwork burden was divided by the estimated number of certified RRP establishments in year 1

to produce burden hours per entity. Finally, the estimate for the burden hours per entity in year 1 was

multiplied by the total number of entities in years 2 and 3, yielding the total paperwork burden. A similar

methodology was used to calculate total paperwork costs.

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Table 6-19: Total Paperwork Burden and Costs Incurred by Training

Providers and RRP Firms

Year 1 Year 2 Year 3

Total Burden Hours

Training Provider Accreditation 2,520 603 602

Training Provider Notifications 26,517 5,473 5,440

RRP Firms 2,879,064 2,867,260 2,855,505

Total 2,908,101 2,873,336 2,861,547

Total Paperwork Cost

Training Provider Accreditation $111,098 $23,572 $23,547

Training Provider Notifications $866,208 $178,767 $177,696

RRP Firms $252,012,587 $250,978,569 $249,949,032

Total $252,989,894 $251,180,908 $250,150,274

Note(s) Numbers may not calculate due to rounding.

Table 6-20 presents the total paperwork costs estimated to be incurred by EPA under the proposed LRRP

Clearance Rule.

Table 6-20: Total EPA Costs

Year 1 Year 2 Year 3

Training Provider Accreditation $94,080 $20,480 $20,480

Training Provider Notifications $23,226 $4,792 $4,763

Dust Sampling Technician

Notifications $1,342,926 $267,486 $266,388

Total $1,460,232 $292,758 $291,631

Note(s) Numbers may not calculate due to rounding.

6.2 Regulatory Flexibility Act

The Regulatory Flexibility Act (RFA) of 1980, amended by the Small Business Regulatory Enforcement

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

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

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

impacted small entities. The RFA requires agencies to prepare an initial and final regulatory flexibility

analysis for each rule unless the Agency certifies that the rule will not have a significant economic impact

on a substantial number of small entities. The RFA, however, does not specifically define “a significant

economic impact on a substantial number” of small entities. Sections 603 and 604 of the RFA require

that regulatory flexibility analyses identify the types and estimate the numbers of small entities to which

the rule will apply. It also requires a description of the rule requirements to which small entities will be

subject and any regulatory alternatives, including exemptions and deferral, which would lessen the rule’s

burden on small entities.

The 2008 LRRP Rule requires that all entities that perform renovation, repair and painting work for

compensation in target housing or public and commercial buildings with COFs become certified by EPA,

ensure that their employees are trained as either renovators or workers, and use lead-safe work practices

when disturbing lead-based paint, other than events that qualify for the minor maintenance exception.

This analysis considers the incremental impacts of the proposed LRRP Clearance Rule on small entities in

the affected construction, real estate, and child-occupied facility industry sectors. The proposed LRRP

Clearance Rule requires dust wipe testing or clearance after certain renovation activities where the

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quantity and characteristics of the dust make sufficient cleaning difficult. It is predicted that this

proposed rule would result in additional individuals seeking dust sampling technician training. It also

would result in additional dust sampling, re-cleaning, lab, and paperwork costs incurred by firms

frequently performing these types of high-dust-generating renovation activities.

Therefore, the proposed LRRP Clearance Rule affects many of the same small entities affected by the

2008 LRRP rule: entities that provide childcare for compensation including private sector firms (e.g.

daycare centers and family daycare); small governments (particularly school districts) and non-profit

organizations; small construction-related contracting firms that provide RRP services to residences or

public or commercial buildings containing COFs; and property managers and lessors who rent target

housing or lease space to COFs and use their own staff to conduct RRP work in their buildings.

The impacts on training providers are not analyzed because the rule will result in an increased demand for

their services. Therefore training providers will incur positive rather than negative impacts. Although the

rule may also result in additional costs for training providers (i.e. costs of additional recordkeeping and

submitting notifications), training providers are expected to recoup these costs via tuition fees. These

tuition fees are accounted for in the estimation of training costs that are incurred by the other entities

subject to the rule.

6.2.1 Definitions of Small Entity

The Regulatory Flexibility Act defines a small government as a government of a city, county, town,

school district or special district with a population of less than 50,000. A small non-profit organization is

defined as any not-for-profit enterprise which is independently owned and operated and is not dominant

in its field. The RFA relies on the definition of a “small business” found in the Small Business Act,

which authorizes the Small Business Administration (SBA) to develop definitions for “small business.”

For this analysis, EPA uses SBA’s definition of a small business for each industry.

For many industry sectors, the SBA definition of a small business is based on revenues, where revenue

standards vary by industry. In establishing revenue standards, SBA considers a number of economic and

market characteristics that may allow a firm to exercise dominance in an industry. These standards

represent the maximum revenue that a for-profit enterprise may have and still qualify as a small business.

Table 6-21 lists the eight NAICS codes of the general and specialty contractors this rule will likely

impact. Their respective SBA thresholds are also listed. Table 6-21 also lists two NAICS codes for

residential real estate industries, two NAICS codes for nonresidential real estate industries, and one

NAICS code for child day care services that are also likely to be affected by the rule. Note that this

analysis excludes the following construction sectors expected to be affected by the 2008 LRRP rule but

not the proposed LRRP Clearance Rule: (1) siding contractors, (2) other building equipment contractors,

(3) other building finishing contractors, and (4) glass and glazing contractors. These contractors do not

typically perform the types of renovations covered by the proposed rule.

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Table 6-21: SBA Revenue Thresholds for Small Business by NAICS Code

NAICS Industry Description

SBA Revenue

Threshold

(Millions $)

General and Specialty Contractor Industries

236118 Residential remodelers $33.5

236220 Commercial Building Construction $33.5

238350 Finish carpentry contractors $14

238340 Tile and terrazzo contractors $14

238220 Plumbing and HVAC contractors $14

238320 Painting and wall covering contractors $14

238210 Electrical contractors $14

238310 Drywall and insulation contractors $14

Property Owners and Managers

531120 Lessors of nonresidential buildings (except miniwarehouses) $7

531312 Nonresidential property managers $2

531311 Residential Property Managers $2

531110 Lessors of Residential Buildings and Dwellings $7

Providers of Day Care Services, Pre-Kindergarten and Kindergarten

624410 Child day care services $7

Source U.S. Small Business Administration, 2008

The RFA classifies small entities as small businesses, small non-profit organizations, or small

governments. Property managers and lessors, and construction-related contractors, are all assumed to be

for profit operations. All daycare providers operating in individual homes (frequently referred to as

family daycare) are assumed to be for-profit operations. Daycare centers can be operated by for-profit or

non-profit organizations. Kindergartens and pre-kindergartens refer to facilities in either public schools

(governmental) or in private schools (assumed to be non-profits). These classifications are summarized in

the following table.

Table 6-22: Small Entity Classifications

Type of Entity Business Non-Profit Governmental

Construction-Related

Contractors X -- --

Day Care Centers X X --

Kindergartens and PreKindergartens in

Public Schools

-- -- X

Kindergartens and PreKindergartens in

Private Schools

-- X --

Property Managers and

Lessors X -- --

6.2.2 General Assumptions and Approach

This analysis measures the potential incremental impacts of the proposed LRRP Clearance Rule on small

businesses in terms of annual compliance costs as a percentage of annual revenues, referred to as the cost

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impact ratio.6This approach is based on the premise that the cost impact percentage is an appropriate

measure of an entity’s ability to afford the costs attributable to a regulatory change. For purposes of

determining small entity impacts, comparing annual compliance costs to annual revenues provides a

reasonable indication of the magnitude of the regulatory burden relative to a commonly available and

objective measure of a company’s business volume. Where regulatory costs represent a very small

fraction of a typical establishment’s revenue, the impacts of a regulation are likely to be minimal.

This analysis considers seven different groups of entities: public school districts, private schools, daycare

centers, construction contractors (residential and non-residential), and property lessors and managers

(residential and non-residential). The goal of this analysis is to evaluate the incremental impacts of the

proposed LRRP Clearance Rule on small entities in a typical year. In order to develop a realistic

portrayal of the long-term effects of the rule on small entities, annualized costs of the rule, rather than

first-year costs, are used to measure its impacts. Furthermore, when presenting the number of businesses

affected, the analysis presents the annual average number of businesses, rather than first or second year

estimates of affected businesses.

The SBA size standards are measured at the firm or parent company level. Conceptually, the small entity

analysis would also be conducted at that level. Due to data limitations, this small entity analysis is

conducted at the establishment level rather than at the firm or parent company level for most sectors.

Census information was available primarily at the establishment level, making a firm or parent company

analysis unfeasible. The only sectors where firm-level data are used are non-residential managers and

lessors, and public schools. Because establishments, and not organizations, are analyzed, an assumption

is made that none of the small establishments are subsidiaries of larger organizations. This assumption

leads to an overestimate of the number of small independent establishments affected by the rule.

Furthermore, since organization-level revenues of multi-establishment businesses are higher than

establishment revenues, the use of establishment data may result in higher cost-impact ratios than actually

exist.

The cost-impact ratios estimated for the non-residential real estate industries (NAICS 531110, 531311,

531120, 531312) in this small entity analysis are based on employment and revenue data for employer

establishments only. It is assumed that the majority of non-residential property lessors and managers are

businesses with employees. Further, the analysis assumes that a self-employed lessor or manager is likely

to hire a contractor to perform work on his property, particularly in a non-residential building.

6.2.2.1 Costs Incurred by Small Establishments

To estimate the costs incurred by the small entities subject to the requirements of the rule, this analysis

calculates the number of dust sampling technicians trained and number of dust wipe testing or clearance

events performed by each of the small entities in a typical year. The renovation events using a heat gun

for paint removal, removing or replacing window or door frames, removing paint through scraping, or

removing trim or molding will only require dust wipe testing. Clearance (which includes dust wipe

testing) is only necessary for events using machines that disturb lead-based paint through high-speed

operation or events involving demolition or removal of plaster through destructive means. Therefore, the

following analysis presents incremental costs for these events under the proposed LRRP Clearance Rule.

Average Annualized Unit Cost Estimates

Unit training costs were calculated by annualizing the total 50-year costs of training dust sampling

technicians performing RRP projects in target housing or public or commercial building COFs, then

6

For private schools, where adequate revenue data were not available, costs are compared to annual expenditures.

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dividing this total by the average annual number of dust sampling technicians trained by these

establishments. Similarly, the annualized total costs of complying with dust wipe testing and clearance

provisions were divided by the average annual number of events. This single set of average annualized

unit costs was used to calculate total costs to small entities working in target housing and public and

commercial building COFs. The use of annual numbers of firms, individuals, and events in calculating

average annualized costs takes into account the fact that the pre-1978 housing and building stock is

expected to decrease by 0.41 percent per year due to demolition of a portion of the building stock.

The numbers of events, individuals, and firms were averaged over the 50 years covered in this analysis

using the following formula:

Annual Average =

Where:

A1 = First year number of events, individuals or firms

A2 = Second year number of events, individuals or firms

r = (1 – 0.41% demolition rate), or 0.9959

n = 50 years covered by the analysis

Table 6-23 presents these calculations and the resulting average annualized unit costs. Because the

different types of COF operators generally perform renovations with very different job sizes, per-event

unit costs were calculated separately for each group doing RRP in public and commercial building COFs.

6.2.3 Residential Contractors

Establishments that perform RRP work in target housing will incur the costs of training, as well as the

per-event costs of dust wipe testing or clearance following certain renovation activities. In order to

distribute the total costs of the rule between small and large establishments, EPA assumed that the

compliance cost incurred by each establishment is a function of the number of regulated renovation

Table 6-23: Average Annualized Unit Cost Calculations under the Proposed LRRP Clearance Rule

Unit Cost

Total

Annualized 50-

Year Costa

50-year Average Number of

Individuals Trained or

Events Performed

Average cost per

individual or eventb

Dust Sampling Technician Training $29,563,881 202,745 individuals trained $146

Target Housing Event $241,830,056 1,445,580 events performed $167

Non-Residential Contractor Event $244,690 406 events performed $603

Non-Residential Lessor and Property Manager

Event $74,336 152 events performed $490

Non-Profit Daycare Center In-House Event $64,776 132 events performed $490

Private School In-House Event $63,586 81 events performed $789

Public School In-House Event $196,762 257 events performed $766

a. These costs were estimated using a 3% discount rate.

b. Averages may not equal numbers calculated from the totals in the table because they are calculated from totals before

rounding.

[A1+(A2*(1-r

n

))/(1-r)]

50

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events that the establishment performs in a typical year. For each of the eight residential contractor

NAICS groups, EPA calculated the average annualized numbers of trained dust sampling technicians for

small entities and the number of proposed LRRP Clearance Rule events being performed by small

entities. These averages were calculated separately for non-employer and employer firms. Using the

average annualized unit costs, EPA calculated the average annualized total costs to small entities affected

by the proposed LRRP Clearance Rule. The use of annualized costs provides a more accurate

representation of the long-term (typical year) impacts of the rule than would be provided by first or

second year costs.

The following six steps were used to calculate the cost-impact ratios for the residential contractor

industries. To estimate the impacts of the proposed rule on small entities in the affected industries, the

following calculations were performed for each NAICS industry:

Step 1: Certified establishments were classified as either small or large businesses depending on their

revenues. Non-employer contractors were considered separately from small employer establishments and

therefore there are two small business categories for each residential contractor NAICS group.

Step 2: Census data were used to characterize a “typical” small establishment (in terms of revenues and

number of employees) in each of the affected industry sectors.

Step 3: The average number of regulated events performed by an establishment each year was estimated

by multiplying the ratio of regulated events to personnel by the establishment employment size.

Step 4: An average cost per event, and the training cost per dust sampling technician were calculated

using the total annualized 50-year costs to entities working in target housing, the 50-year average number

of renovation events requiring dust wipe testing or clearance, and the 50-year average number of dust

sampling technicians obtaining training.

Step 5: For small entities performing regulated activities, total establishment compliance costs were

calculated by multiplying the number of events performed and the number of technicians trained by the

corresponding average annualized costs.

Step 6: Cost-impact ratios were calculated for a typical small establishment in each industry sector by

dividing the average compliance costs incurred by each establishment (Step 5) by the establishment’s

revenues (Step 2). These cost impact ratios were calculated both for non-employer and small employer

NAICS groups separately and combined.

6.2.3.1 Number of Small Residential Contractors and Real Estate Entities Affected by the

Proposed LRRP Clearance Rule

The data used in this analysis were drawn primarily from the 2002 U.S. Economic Census. As discussed

in Chapter 2, Census data were used to estimate the number of non-employer establishments (selfemployed contractors) in the affected construction industries. The 2002 Census also provides data on the

number, revenue and employment of establishments with payroll by revenue bracket for each construction

industry sector affected by the rule. In Chapter 2, these data were used to classify construction

establishments into two main size classes – establishments with annual revenues of less than $10 million,

and establishments with annual revenues of $10 million or more. The percent of establishments,

employees, net value of construction and total value of business contributed by establishments in each

revenue bracket can be found in Chapter 2.

Because 2002 Census data on the number of establishments by revenue bracket was not available at the

time the estimates were developed, 1997 Census data was used to estimate the percent of establishments

in each industry that qualify for small business status. These percentages, as well as the percent of

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industry revenues and employment contributed by small and large establishments, are presented in

Chapter 2.

The Small Business Administration revenue thresholds for establishments in the construction sectors are

currently set at $33.5 million for Residential Remodelers and at $14 million for the seven specialty

contractor industries. However, in applying the U.S. Economic Census data to the SBA definition of

small business, it is not possible to estimate the exact number of construction establishments that have

revenues below the SBA threshold because the U.S. Economic Census groups all establishments with

revenues of $10 million or more into one revenue bracket. Applying the U.S. Economic Census data

therefore requires either under or overestimating the number of small businesses affected by the rule. On

the one hand, using data for the entire industry would overestimate the number of small businesses

affected by the rule. It would also underestimate the rule’s impact on small businesses because the

impacts would be calculated using the revenues of large businesses in addition to small businesses. On

the other hand, applying the closest, albeit lower, revenue bracket would underestimate the number of

small businesses affected by the rule while at the same time overestimating the impacts. For example,

because the $10 million cut-off is below the SBA threshold for the Residential Remodeler industry, using

the U.S. Economic Census data may lead to an underestimate of the number of small businesses in this

sector, although likely a small underestimate.7 At the same time, using these data may lead to a slight

overestimate of the impacts of the rule, as the average revenues of small businesses will appear smaller

when larger establishments (those with revenues of $10 to $33.5 million) are left out. See Section 6.2.2

for a discussion of assumptions that may result in an overestimation of the number of affected small

businesses. Moreover, using data on all businesses regardless of size would defeat the purpose of

estimating impacts on small business. EPA has chosen to be more conservative in estimating the cost

impacts of the rule on small businesses by using the $10 million threshold for construction industry

sectors.

In order to estimate the number of certified small establishments with paid employees, EPA assumed that

the number of certified small employers is proportional to the total number of small employer

establishments in the industry. The total number of certified establishments in each industry (calculated

in Chapter 4) was multiplied by the percentage of establishments in that industry with revenues below the

revenue thresholds described above. For the eight residential construction industry sectors, the resulting

number of small employer establishments was added to the total number of certified self-employed

contractors to obtain the total number of small certified establishments.

Table 6-24 shows the 50-year average number of small businesses affected by the proposed rule. The

number of affected businesses is predicted to decrease proportionally to the number of regulated events,

which in turn decline at an annual rate of 0.41 percent (see Chapter 4 for discussion).

7

Because 99.7 percent of Residential Remodeler establishments earn less than $10 million per year, any

underestimate of the number of establishments is likely to be minimal.

Table 6-24: 50-Year Average Number of Small Residential

Contractors Affected

Non-Employer Establishments a150,522

Employer Establishments 51,715

Total Small Establishments 202,237

a. Also referred to as “self-employed” individuals.

Source EPA Calculations

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6.2.3.2 Training Costs – Small Residential Contractors

Number of Individuals Trained – Residential Contractors

As described above, the number of certified small establishments with paid employees was estimated

assuming that the number of certified small employers is proportional to the total number of small

employer establishments in the industry. The total number of certified establishments in each industry

(calculated in Chapter 4) was multiplied by the percentage of establishments in that industry with

revenues below the revenue thresholds described above in section 6.2.3. The number of small employer

establishments in each NAICS group expected to obtain certification is presented in Table 6-25. Each of

these establishments is assumed to seek dust sampling technician training for one employee.

To estimate the number of employees of an average small establishment in each affected industry, EPA

used U.S. Economic Census data to determine the portion of each industry’s employees that work for

small businesses. This percentage was applied to the estimated number of trained dust sampling

technicians and workers in each sector to calculate the number of trained dust sampling technicians and

workers employed by small certified establishments. For each of the construction and real estate industry

sectors, the total number of employees (including non-employers) was divided by the total number of

small establishments to calculate an average small business employment size.

Table 6-25 presents the 50-year average number of small certified employer firms, each of which is

assumed to employ one trained dust sampling technician. Only entities that would use their own dust

sampling technician for compliance with the proposed LRRP Clearance Rule would incur additional

training costs. As described in Chapter 4, it was found to be cost-effective for all residential non-employer

and employer construction firms to train their own dust sampling technician rather than use third party

dust wipe testing services. It was also shown that none of these establishments are expected to perform

enough dust wipe testing or clearance events annually to justify training more than one dust sampling

technician.

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Table 6-25: 50-Year Average Number of Dust Sampling Technicians Trained

by Small Employer Establishments

NAICS Description

Annualized Number of

Trained Dust Sampling

Technicians, Small

Establishmentsa

236118 Residential remodelers 20,408

238350 Finish carpentry contractors 7,717

238340 Tile and terrazzo contractors 1,101

238220 Plumbing and HVAC contractors 10,214

238320 Painting and wall covering contractors 4,288

238210 Electrical contractors 6,221

238310 Drywall and insulation contractors 1,766

Total, Small Employer Establishments 51,715

a. Since employer construction establishments are assumed to have need for one

trained dust sampling technician, the total number of trained employees working

for small construction establishments is simply the sum of the number of certified

small employers.

Source U.S. Census Bureau 2000d; U.S. Census Bureau 2004; U.S. Census Bureau 2005

b-e,g,h; U.S. Small Business Administration 2005.

Table 6-26 presents the 50-year average number of dust sampling technicians trained for non-employer

residential contractor establishments. Since non-employer establishments consist of single individuals,

each self-employed individual must obtain dust sampling technician training.

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Table 6-26: 50-Year Average Number of Dust Sampling Technicians Trained

by Small Non-Employer Construction Establishments

NAICS Description

Annualized Number of

Trained Dust Sampling

Technicians, Small

Establishmentsa

236118 Residential remodelers 48,020

238350 Finish carpentry contractors 40,873

238340 Tile and terrazzo contractors 5,839

238220 Plumbing and HVAC contractors 13,137

238320 Painting and wall covering contractors 22,683

238210 Electrical contractors 10,382

238310 Drywall and insulation contractors 9,589

Total, Non-Employer Establishments 150,522

a. Since non-employer construction establishments are assumed to have need for one

trained dust sampling technician, the total number of trained employees working

for small construction establishments is simply the sum of the number of certified

self-employed contractors.

Source U.S. Census Bureau 2000d; U.S. Census Bureau 2004; U.S. Census Bureau 2005

b-e,g,h; U.S. Small Business Administration 2005.

Total Training Costs to Small Residential Contractors

To estimate small residential contractor training costs, the numbers of individuals in Table 6-25 and Table

6-26 were multiplied by the average annualized costs of training a single certified dust sampling

technician from Table 6-23. The resulting average annualized training costs are presented in Table 6-27.

Table 6-27: Average Annualized Training Costs for Small Residential Contractors

Regulatory Option

Annualized Number of

Trained Dust

Sampling Technicians

Total Certified

Technician Training

Costa

Average Training Cost

Per Establishment

Proposed rule 202,237 $29,489,816 $146

a. A 3 percent discount rate is used for estimating total costs.

6.2.3.3 Dust Wipe Testing and Clearance Costs – Small Residential Contractors

Number of Events Performed Annually by Small Residential Contractors

As discussed in Section 6.2.2 and the beginning of this section, this analysis attributes the dust wipe

testing and clearance costs of the proposed rule to establishments on a per-event basis. In order to

estimate the total number of events performed by establishments in each of the affected industries and in

order to distribute these events between small and large establishments, EPA assumed that the number of

events performed by each establishment is proportional to the number of people the establishment

employs. Furthermore, EPA assumed that the number of events performed by each trained employee will

be the same across all industries. If a certain industry performs fewer events than estimated here, the

impacts on these establishments will be slightly smaller and the impacts on the other construction

industries will be slightly larger.

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The number of events per small establishment in a particular industry was calculated as follows:

EPA estimated the 50-year average number of events per employee by calculating the ratio of the total

number of regulated events to the total number of construction workers (using the 50-year averages).

Because the number of establishments, as estimated in Chapter 4, was assumed to be proportional to the

regulated housing stock and the number of regulated events, the number of RRP events per employee

does not change over time.

To estimate the average number of events performed by a small establishment in a given industry, the

establishment’s average employment size was multiplied by the average number of events per individual.

Table 6-28 presents the 50-year average estimated number of events per small establishment.

Table 6-28: 50-Year Average Annual Number of Events performed by

Small Residential Contractors for the Proposed LRRP Clearance Rule

Regulatory

Option

Average Small

Employment

Size

Average Number

of Annual Events

Per Employee

Total Annual

Number of Events

Per Small

Establishment

Proposed rule 1.8 3.4 6.1

Total Clearance Rule Costs – Residential Contractors

Table 6-23 presents the annualized average per-event costs of the proposed rule. For affected entities,

these costs include the cost of performing dust wipe testing following certain renovation activities and

complying with the re-cleaning and clearance requirements for another set of renovation practices.

Multiplying the average event cost per small establishment by the total 50-year average number of small

entities (see Section 6.2.3.1) yields the total incremental dust wipe testing and clearance costs of the

proposed LRRP Clearance Rule. These costs are presented in Table 6-29.

Table 6-29: Average Annualized Dust Wipe Testing and Clearance Costs for Small Residential

Contractors

Regulatory

Option

Avg. Number of

Events per

Small Estab.

Annualized

Average PerEvent Costb

50-year Avg.

Number of

Small Estab.

Total Event

Costs a

Avg. Event Costs

per Small Estab.

Proposed 6.1 $167 202,237 $206,429,441 $1,021

a. Total costs are calculated using unrounded unit costs; a 3 percent discount rate is used.

b. Includes the cost of performing dust wipe testing for a subset of renovation events and dust sampling, recleaning, and clearance for a separate subset of renovation events.

6.2.3.4 Residential Contractors

Cost-impact ratio analysis compares the cost of a regulation to an establishment’s total revenues, not just

to its revenues from the regulated activity. As such, for construction establishments, the costs of the rule

were compared to the total value of business done rather than just to the total value of construction work.

For real estate establishments, total revenues were used. Because no revenue data are available

Number of Events = (Events/Employee) X (Average Establishment Employment Size)

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specifically for establishments expected to seek certification under the regulations, EPA assumed that

average revenues of these businesses do not differ significantly from industry averages.

EPA calculated the revenues of a small certified construction business as a weighted average of small

employer and non-employer revenues. The 2002 U.S. Economic Census presents data on the number and

total value of business done by construction establishments with total annual revenues of $0 to $10

million and $10 million or more. To estimate the average revenues of small employers in each of the

affected construction sectors, the total value of business done by establishments in the $0 to $10 million

bracket was divided by the total number of establishments in that bracket. Since the Census presents

revenue figures in year 2002 dollars, the resulting average revenues were inflated to 2008 dollars using

the Consumer Price Index.8Per-establishment revenues for non-employers were estimated for the cost

impact ratio analysis by dividing non-employer revenues (inflated to 2008 dollars) by the number of nonemployer establishments in each industry. Average revenues of certified small establishments are

presented in Table 6-30. Because 2002 data on the number of establishments by revenue bracket was not

available at the time the estimates were developed, 1997 data was used to estimate the percent of

establishments in each industry that qualify for small business status. EPA also used 1997 Census data to

calculate the percent of industry revenues contributed by these establishments. These percentages were

then applied to the 2002 numbers of establishments and industry revenue figures to estimate the number

and revenues of small and large employers in each industry. Average small employer revenues

(calculated by dividing the revenues of establishments in each industry and revenue bracket by the

corresponding number of establishments) were inflated to 2008 dollars using the Consumer Price Index.

The resulting estimates are presented in Table 6-30.

Table 6-30: Average Revenues of Small Businesses Affected by the

Proposed Clearance Rule

NAICS Industry Description

Small Business

Revenues

(2008$)

236118 Residential remodelers $201,669

238350 Finish carpentry contractors $111,032

238340 Tile and terrazzo contractors $143,466

238220 Plumbing and HVAC contractors $476,976

238320 Painting and wall covering contractors $95,731

238210 Electrical contractors $387,707

238310 Drywall and insulation contractors $265,127

Total Average, Construction Establishments $214,391

Weighted average of employer and non-employer revenues.

Source U.S. Census Bureau 2005b,d,e; U.S. Small Business Administration 2005;

U.S. Census Bureau 2004; U.S. Census Bureau 2000d.

6.2.3.5 Impacts on Small Residential Contractors

Impacts of the rule on small residential contractors were measured by comparing the costs of the rule

incurred by an establishment to the establishment’s revenues. The impacts on small residential contractor

8 Annual values from the CPI-U series (All items, US city average, Series Id: CUUR0000SA0) were used to inflate dollar values

to 2008 dollars.

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establishments were estimated by first taking the sum of the total annualized event and training costs

incurred by these entities and dividing these total costs by the number of establishments. Average costs

per establishment were then divided by average revenues to calculate a cost-to-revenue ratio. These

calculations, and the resulting cost-to-revenue ratios, are presented in Table 6-31.

Table 6-31: Cost-to-Revenue Ratios for Small Residential Contractors

Regulatory

Option

Total Affected

Small Entities

Total Cost of Rule

to Small Entities,

Annualizeda

Average Cost of

Rule per Small

Entity

Estimated Average

Small Entity

Revenues

Cost-toRevenue Ratio

Proposed rule 202,237 $235,919,257 $1,167 $214,391 0.544%

a. A 3 percent discount rate is used.

Table 6-32 presents the impacts of the rule on small residential contractors, by NAICS group, for nonemployer and employer establishments both separately and combined. Impact estimates for nonemployers should be interpreted with caution, as some non-employers may have issues related to underreporting of income, which would tend to exaggerate the average impact ratio for this class of small

entities. According to GAO, many sole proprietors underreport their income, with a small proportion

accounting for the bulk of understatements (GAO 1994 and 2007). According to IRS estimates reported

by GAO, sole proprietors underreported their net income by 57 percent in 2001 (GAO 2007). The IRS

estimates address net income (i.e., revenues minus expenses), while the small entity analysis compares

compliance costs to revenues. According to IRS figures, underreporting of gross income makes up at

least half of the misreporting of net income. A key reason for this underreporting is that the income of the

self-employed is not subject to withholding and only a portion of that income is subject to information

reporting by third parties (GAO 2007). The IRS estimates that at least 61 percent of sole proprietors

underreported their income, and the IRS recognizes that these are underestimates because detecting

underreported income is difficult, especially cash receipts (GAO 2007). Although at least 61 percent of

sole proprietors had understated taxes, the amounts were skewed with half of sole proprietors understating

less than $903.

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6.2.4 Non-Residential Contractors

Non-residential contractors (i.e., those working in public or commercial building COFs) are currently

regulated under the 2008 LRRP Rule. Jobs that are not performed in-house by public and private schools,

non-residential property managers/lessors, or daycare centers will be performed by general and specialty

contractors including painters, electricians, plumbers/HVAC specialists, and non-residential building

contractors. Under the proposed rule, 448 establishments are expected to incur dust wipe testing and

clearance costs in the first year. Because different contractors are generally expected to work in public or

commercial buildings and target housing, this analysis considers impacts on these groups of

establishments separately.

Because renovation events in public or commercial building COFs are generally larger compared to those

in target housing, this analysis assumes that only contractors with employees will work on COFs in public

Table 6-32: Cost-to-Revenue Ratios: Small Residential Construction Establishments (Proposed

Option)

NAICS Industry Description Number of

Small

Entities

Costsa Revenues CostImpact

Ratio

Non-Employers

236118 Residential remodelers 48,020 $34,185,929 $1,811,671,241 1.89%

238350 Finish carpentry contractors 40,873 $29,098,396 $1,373,680,993 2.12%

238340 Tile and terrazzo contractors 5,839 $4,156,563 $246,542,544 1.69%

238220 Plumbing and HVAC contractors 13,137 $9,352,522 $835,804,455 1.12%

238320 Painting and wall covering contractors 22,683 $16,148,118 $630,410,871 2.56%

238210 Electrical contractors 10,382 $7,391,113 $461,069,222 1.60%

238310 Drywall and insulation contractors 9,589 $6,826,244 $966,038,669 0.71%

Total, Small Construction Establishments 150,522 $107,158,886 $6,325,217,995 1.69%

Employers

236118 Residential remodelers 20,408 $30,592,288 $11,988,045,317 0.26%

238350 Finish carpentry contractors 7,717 $15,073,799 $4,021,354,972 0.37%

238340 Tile and terrazzo contractors 1,101 $2,999,533 $749,095,264 0.40%

238220 Plumbing and HVAC contractors 10,214 $35,242,942 $10,302,305,492 0.34%

238320 Painting and wall covering contractors 4,288 $11,192,013 $1,951,464,139 0.57%

238210 Electrical contractors 6,221 $24,619,776 $5,975,872,677 0.41%

238310 Drywall and insulation contractors 1,766 $9,040,021 $2,044,473,203 0.44%

Total, Small Construction Establishments 51,715 $128,760,371 $37,032,611,063 0.35%

Employers and Non-Employers Combined

236118 Residential remodelers 68,428 $64,778,217 $13,799,716,558 0.47%

238350 Finish carpentry contractors 48,590 $44,172,194 $5,395,035,965 0.82%

238340 Tile and terrazzo contractors 6,940 $7,156,096 $995,637,808 0.72%

238220 Plumbing and HVAC contractors 23,352 $44,595,464 $11,138,109,947 0.40%

238320 Painting and wall covering contractors 26,970 $27,340,131 $2,581,875,010 1.06%

238210 Electrical contractors 16,603 $32,010,890 $6,436,941,899 0.50%

238310 Drywall and insulation contractors 11,355 $15,866,265 $3,010,511,872 0.53%

Total, Small Construction Establishments 202,237 $235,919,257 $43,357,829,058 0.54%

a. Total costs are calculated using a 3 percent discount rate.

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or commercial buildings.9Furthermore, the types of jobs performed in public or commercial building

COFs are generally less varied than those in target housing. Events in COFs are assumed to consist

primarily of painting, window/door replacement, and plumbing and electrical projects. As such, it is

likely that most of these projects will be performed by painting, plumbing/HVAC, electrical, and

commercial building contractors (NAICS 238320, 238220, 238210 and 236220, respectively). As

illustrated in Chapter 4, non-residential contractors will not typically perform enough dust wipe testing or

clearance events annually to make it cost-effective for them to train their own dust sampling technician.

While non-residential contractors are not expected to incur training costs, they are assumed to incur third

party dust wipe testing and clearance costs for the events in public and commercial buildings that they

perform.

6.2.4.1 Number of Small Non-Residential Contractors Affected by the Proposed LRRP Clearance

Rule

To estimate the number of construction establishments working in public or commercial building COFs,

the number of affected jobs they perform, and their average revenues, the following assumptions were

made:

 The number of contractors in each sector is proportional to the number of jobs likely to be

performed by each type of contractor.

 These currently regulated contractors are only assumed to perform projects in public or

commercial building COFs. In reality, however, these additional contractors may perform some

residential work and some commercial work, while contractors with employees that were

included in the residential contractor section of this analysis may also do some of the nonresidential COF work. As such, to define the size and revenue of the average small firm working

in public or commercial building COFs, the numbers of certified non-residential contractors with

employees were added to the pool of pre-existing certified residential employer establishments in

the corresponding sectors. The percent of small establishments in each sector, percent of workers

employed (and thus jobs performed) by these establishments, and percent of total value of

business earned by these establishments were calculated using 2002 Economic Census data on the

number of small establishments and employees working for small establishments (U.S. Census

Bureau 2005a). Average revenues of small establishments were estimated by dividing the total

value of business earned by establishments with revenues below $10 million in each sector by the

total number of establishments with revenues below $10 million in that sector. The results of

these calculations are presented for in Table 6-34. Note that because only establishments with

employees are assumed to work in public or commercial building COFs, average revenues of

small establishments in Table 6-34 are higher than the average revenues of residential

construction establishments, which include self-employed contractors.

Table 6-33 presents the distribution of events by COF type, shows the ratio of contractor to in-house

events, and presents estimates of the total number of contractor events in the first year. Table 6-34

displays the estimated number and characteristics of small non-residential contractor firms affected by the

2008 LRRP Rule. Although 3,223 non-residential property manager and lessor firms are regulated under

the 2008 LRRP Rule, only a fraction of these firms will perform renovation in public and commercial

building COFs requiring dust wipe testing or clearance in a given year. It is estimated that an average of

448 non-residential contractors will be affected by the proposed rule in an average year.

9

In contrast, the analysis of target housing contractors assumes that both employer and non-employer (i.e., selfemployed) contractors will work on COFs in target housing.

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Table 6-33: Estimated Number of First-Year Non-Residential Contractor Events

Type of COF

Total Number of

Events

Percent of Events

Performed by

Non-Residential

Contractors

Total Number of

Contractor Events

Public Schools

Kindergarten (Public) 192 20% 39

Pre-K + Kindergarten (Public) 150 18% 28

Daycare Center (In Public School) 10 19% 2

Private Schools

Kindergarten (Large Private) 27 20% 6

Pre-K + Kindergarten (Large Private) 82 18% 15

Kindergarten (Small Private) 32 100% 32

Pre-K + Kindergarten (Small Private) 41 100% 41

Daycare Center (In Large Private School) 0 19% 0

Daycare Center (In Small Private School) 0 100% 0

Daycare Centers

Daycare Center (Renter-Occupied) 208 19% 40

Daycare Center (Owner-Occupied) 142 100% 142

Daycare Center (Non-Profit who performs

some of own RRP) 181 19% 35

Daycare Center (Non-Profit who uses

contractors) 67 100% 67

Total Jobs 1134 39% 448

This analysis assumes that private schools, public schools, and non-profit daycare centers which use in-house

staff to perform RRP will perform all window/door carpentry work every year in-house. Non-residential

contractor firms will perform all other RRP. Non-residential contractor firms will perform all RRP events in

owner-occupied daycare centers, daycare centers that do not perform some of their own RRP, and small private

schools.

Table 6-34: Estimated Numbers and Characteristics of Small Non-Residential Contractors

NAICS

Contractor Description

Estab.,

Residential

Estab.,

NonResidential

Est.,

Total

Percent

Small

Number

Small

Percent

Workers

at Small

Estab.

Average

Revenues of

Small Estab.

238220 - Plumbing/

HVAC 11,200 1,482 12,681 97.9% 12,410 70.1% $850,881

238210 - Electrical

contractors

6,824 1,482 8,306 97.9% 8,132 67.9% $809,692

236220 - Commercial

building contractors 0 105 105 88.1% 93 41.4% $1,750,332

238320 - Painting/ wall

covering 4,615 155 4,770 99.7% 4,757 91.5% $380,165

Total/ Weighted Avg.

Small Non-Residential

Contractor Firm

22,639 3,223 25,862 98.2% 25,391 69.2% $752,783

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6.2.4.2 Dust Wipe Testing and Clearance Costs – Non-Residential Contractors

Number of Events Performed by Small Establishments – Non-Residential Contractors

On average, 69 percent of the 448 non-residential contractor dust wipe testing or clearance events in the

first year are performed by small businesses. Since the number of affected firms is defined to be the

number of firms performing a dust wipe testing or clearance event in the first year, the number of jobs

performed is equivalent to the number of establishments affected. Table 6-35 presents the total number of

small contractor establishments incurring event costs and the number of events in the first year.

Table 6-35: First Year Number of Small Non-Residential Contractor Establishments

and Jobs Performed

Regulatory Total, non-residential COF contractor Small, non-residential COF contractor

Option

Establishments Events Establishments Events

Proposed 448 448 281 281

To estimate typical annual small businesses impacts, this analysis estimated the 50-year average number

of certified firms and regulated events given that the number of certified firms is expected to decrease

proportionally to the size of the regulated housing stock. These estimates are presented in Table 6-36.

Table 6-36: 50-Year Average Annual Number of Small Certified Establishments

and Jobs Performed

Regulatory Option Number of Firms with

Clearance Rule Costs Number of Jobs Performed

Proposed rule 281 281

Total Clearance Rule Costs – Non-Residential Contractors

To estimate total event costs incurred by small non-residential construction establishments working in

public or commercial building COFs, the 50-Year average annual number of events performed by these

establishments (1 per firm) was multiplied by the average annualized per-event cost ($603; see Table 6-

23). Table 6-37 presents the resulting annualized total and average costs of the Clearance Rule to small

non-residential construction establishments.

Table 6-37: Average Annualized Dust Wipe Testing and Clearance Costs for Small NonResidential Contractors

Regulatory Option

Average

Annual Events

Performed

Annualized

Avg. Per-Event

Cost

Total Event

Costs a

Average Event

Costs per Small

Establishment

Proposed rule 281 $603 $169,235 $603

a. Total costs are calculated using unrounded unit costs of third party dust sampling services; a 3 percent

discount rate is used.

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6.2.4.3 Impacts of the Proposed LRRP Clearance Rule on Non-Residential Contractors

Impacts of the rule on small non-residential contractors are measured by comparing the costs of the rule

incurred by an establishment to the establishment’s revenues. The impacts on small non-residential

contractors were estimated by first dividing the total dust wipe testing and clearance costs under the

proposed option by the number of establishments. Average costs per establishment were then divided by

average revenues to calculate a cost-to-revenue ratio. These calculations, and the resulting cost-torevenue ratios, are presented in Table 6-38.

6.2.5 Non-Residential Property Lessors and Managers

Non-residential property lessors and managers are currently regulated under the 2008 LRRP Rule.

Lessors and managers of pre-1978 public or commercial buildings that rent space to daycare centers and

perform regulated projects on their own properties will incur dust wipe testing and clearance costs under

the proposed LRRP Clearance Rule. The analysis in Chapter 4 demonstrated that non-residential property

managers and lessors are not expected to typically perform enough dust wipe testing or clearance events

annually to justify obtaining dust sampling technician training for one of their employees. Instead, nonresidential real estate firms are assumed to incur only third party dust wipe testing costs for the dust wipe

testing events (and third party and re-cleaning costs for the clearance events) in public and commercial

buildings that they perform. As discussed in Chapter 4, this analysis estimates that 13,279 daycare

centers will rent space in pre-1978 non-residential buildings in the first year. On average (over 50 years),

12,028 daycare centers are expected to rent space in pre-1978 buildings each year. Because daycare

centers are only one of many types of establishments renting non-residential space and because the LRRP

Rule applies only to centers in buildings constructed prior to 1978, the analysis also assumes that each

property manager or lessor firm owns only one non-residential building containing a COF. As such, the

number of affected lessor/manager firms is equivalent to the number of affected daycare centers renting

space or 12,028 firms. Due to the lack of data on the extent to which these firms perform renovation

work in their own buildings, this analysis assumes that they will behave similarly to the operators of other

public or commercial buildings with child-occupied facilities, namely that they will perform all of their

own painting and window/door carpentry projects.

6.2.5.1 Number of Non-Residential Property Lessors and Managers Affected by the Proposed

LRRP Clearance Rule

Although 12,028 non-residential property manager and lessor firms are regulated under the 2008 LRRP

Rule, only a fraction of these firms are operators of daycare center buildings which will undergo

renovation requiring dust wipe testing or clearance in a given year. It is estimated that an average of 152

daycare center buildings renting space will be affected by the proposed rule in an average year.

Lessors and managers of non-residential properties fall under NAICS 531120 and 531312, respectively.

In order to estimate the number of regulated firms in each of these sectors, it is assumed that the percent

of regulated firms in each industry is equivalent to the total percent of non-residential real estate firms in

Table 6-38: Cost-to-Revenue Ratios for Non-Residential Contractors

Regulatory

Option

Total Small

Contractor

Establishments

Total Cost of Rule

to Small

Contractor

Establishments

Average Cost of

Rule per Small

Contractor

Establishments

Average Small

Contractor

Establishment

Revenues

Cost-toRevenue Ratio

Proposed rule 281 $169,235 $603 $139,188 0.433%

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that industry. In other words, since Lessors of Non-Residential Buildings (NAICS 531120) make up 73

percent of establishments in NACIS 531120 and 531312 combined, 73 percent of the 12,028

lessor/manager firms affected by the proposed LRRP Clearance Rule are also assumed to fall in this

sector, while the remaining 27 percent are assumed to fall under NAICS 531312 (Calculated based on

U.S. Census Bureau 2005f).

As discussed in Section 2.4.2 of Chapter 2, 96 percent of Lessors of Non-Residential Real Estate, and 81

percent of Non-Residential Property Managers qualify for small business status under the SBA definition

of a small business in these sectors (U.S. Census Bureau 2005f). This analysis assumes that the size

distribution of regulated firms mirrors the size distribution of the entire non-residential property lessor

and manager industry. Table 6-39 presents the resulting estimates of the number of small non-residential

property lessors and managers affected by the proposed LRRP Clearance Rule in a typical year.

6.2.5.2 Dust Wipe Testing and Clearance Costs – Non-Residential Property Lessors and Managers

Given the relative infrequency of dust wipe testing and clearance events, each affected property lessor or

manager is assumed to perform no more than one event per year. Thus, the estimation of costs incurred

by each regulated property lessor or manager establishment is based on the average dust wipe

testing/clearance costs per event.

The total number of regulated events was multiplied by the average annualized per-event costs (see Table

6-23) to calculate these firms’ total annualized event costs. Table 6-40 presents these estimates, as well

as the average rule costs per small firm.

Table 6-39: Average Annual Number of Small Non-Residential Property Lessors and

Managers Performing RRP Events Requiring Dust Wipe Testing or Clearance

A. Total number of firms leasing to daycare centers 152

B. Number of firms in NAICS 531120 (73% of A) 111

C. Number of firms in NAICS 531312 (27% of A) 41

D. Number of firms in NAICS 531120 that are small (96% of B) 106

E. Number of firms in NAICS 531312 that are small (81% of C) 33

Total Number of Regulated Small Firms (D+E) 140

Regulated Small Firms as % of All Regulated Firms 92%

Table 6-40: Dust Wipe Testing and Clearance Costs of Small Non-Residential Property

Lessor and Manager Establishments

Regulatory Option Total In-House

Eventsa

Annualized

Avg. Costs Per

Event

Total Event

Costs b

Average Clearance

Costs per Small

Firm

Proposed rule 140 $490 $68,327 $490

a. This number was calculated as the average number of events per firm (1.0) times the number of small

non-residential property lessors and managers.

b. Total costs are calculated using unrounded unit costs of third party dust sampling services; a 3 percent

discount rate is used.

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6.2.5.3 Impacts of the Proposed LRRP Clearance Rule on Non-Residential Property Lessors and

Managers

This small entity analysis measures the incremental impacts of the proposed LRRP Clearance Rule on

small non-residential property lessors and managers by comparing rule costs incurred by these firms to

the weighted average revenue of small firms in NAICS 531120 and 531312, calculated based on 2002

Census Data. The weighted average revenue figure of $111,460 was inflated to 2008 dollars using the

Consumer Price Index to obtain estimated revenues of $139,118. The impacts on small non-residential

property lessors and managers were estimated by first dividing total event costs incurred by these entities

by the number of establishments. Average costs per establishment were then divided by average revenues

to calculate a cost-to-revenue ratio.

The average annual numbers of businesses affected, average annualized per-business costs and revenues,

and the resulting cost-to-revenue ratio are presented in Table 6-41.

Table 6-41: Cost-to-Revenue Ratios for Non-Residential Property Managers and Lessors

Regulatory

Option

Total Small

Lessor/ Manager

Firms

Total Cost of Rule

to Small Lessor/

Manager Firms

Average Cost of

Rule per Small

Lessor/ Manager

Firm

Average Small

Lessor/ Manager

Firm Revenues

Cost-toRevenue Ratio

Proposed rule 140 $68,327 $490 $139,188 0.352%

6.2.6 Daycare Centers (Small Non-Profits)

6.2.6.1 Number of Small, Non-Profit Daycare Centers Affected by the Proposed LRRP Clearance

Rule

As discussed in Chapter 2, there are an estimated 87,840 daycare centers in the United States. These

daycare centers include facilities that provide day care outside of a residential home and outside of

schools. Assuming a 75 percent compliance rate, and adjusting the total number of centers for building

age using HUD data on the age of education buildings, an estimated 38,210 daycare centers would be

affected by the proposed rule in the first year.10 As discussed in Chapter 4, because of their locations, forprofit daycare centers are expected to hire outside contractors to perform their renovations and repairs or

to have their landlord handle these activities. The costs and impacts for these events are accounted for in

the sections of this chapter addressing contractors and landlords.

Daycare centers located in religious establishments such as churches or synagogues, however, frequently

use their own staff to perform some of their RRP events. According to the HUD survey of child care

centers (HUD 2003), approximately 73 percent of daycare centers located in churches and other religious

establishments use their own (or the religious organization’s) staff to perform painting projects. This

analysis assumes that, similar to public school districts and private schools, these establishments will also

use their own staff to perform all window/door carpentry work.

The number of non-profit daycare centers is estimated as the number of daycare centers located in

religious establishments, which are identified in the data from the HUD survey of child care centers

(HUD 2003). According to these data, 41 percent of all daycare centers are situated in churches or other

buildings owned by religious establishments (the US Census reports that about 35 percent of daycare

10 Based on 2003 HUD data, 58 percent of all education buildings were constructed before 1978, and 55 percent of

the pre-1978 buildings were constructed before 1960.

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centers located outside of schools are non-profits (U.S. Census Bureau 2005c)). The other 59 percent of

daycare centers are assumed to use outside contractors for their RRP work rather than in-house staff.

Because the estimate of centers that are in religious settings is relatively large and there is no independent

data on other non-profits, this analysis estimates that about 30 percent of daycare centers

(0.73*0.41=.299) will perform their own renovation work and thus incur direct work practice and training

costs.11 Because all of these establishments are treated as though they are operated by religious

organizations, all daycare centers considered in the small entity analysis are considered to be non-profit

organizations. As the RFA defines independently owned and operated not-for-profit enterprises that are

not dominant in their field as “small organizations,” all the non-profit organizations operating these

daycare centers are assumed to qualify as small entities. This assumption may overestimate the number

of impacted small non-profits, since some of these non-profit organizations may not be small entities.

Table 6-42 presents the number of daycare centers performing regulated activities in a typical year, the

total number of daycare centers operated by non-profit organizations (based on the number in religious

organizations), and the number expected to perform some renovation work in-house. The estimation of

the annual average numbers of centers accounts for the fact that, after the first year, the number of

regulated daycare centers is expected to decrease by 0.41 percent per year due to building demolition.

Although 10,481 non-profit daycare centers are regulated structures under the 2008 LRRP Rule, only a

fraction of these buildings will undergo renovation requiring dust wipe testing or clearance in a typical

year. It is estimated that an average of 132 non-profit daycare center buildings doing RRP work in-house

will be affected by the proposed rule in a typical year.

6.2.6.2 Dust Wipe Testing and Clearance Costs – Non-Profit Daycare Centers

The estimated dust wipe testing and clearance costs incurred by each daycare center are based on the

average per-event cost of renovation events requiring dust wipe testing or clearance. The analysis in

Chapter 4 demonstrated that daycare centers are not expected to typically perform enough dust wipe

testing or clearance events annually to justify obtaining dust sampling technician training for one of their

employees. Instead, daycare centers are assumed to incur only third party dust wipe testing and clearance

costs for the events that they perform.

Total Clearance Rule Costs – Non-Profit Daycare Centers

Staff in non-profit daycare centers (such as those operated by religious establishments) are expected to

perform in-house all painting and window/door carpentry work in their building. Each affected firm is

assumed to perform one event per year.

11 Given the small size of the HUD survey sample, and the difference between the HUD and Census figures, the

estimate may include some non-profits operating daycare facilities that are not in religious settings but perform

their own repair work. Other non-profit daycare facilities may be hiring outside contractors, the same as forprofit daycare facilities are assumed to do.

Table 6-42: Average Annual Number of Non-Profit Daycare Centers Performing their Own Work

Regulatory Option (A) Total Number

of Daycare

Centers

(B) Number of Centers in

Non-Profit Organizations

(41% of A)

(C) Number of Centers

Doing RRP Work Inhouse (73% of B)

Proposed rule 34,612 14,339 10,481

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As discussed in Section 6.2.2, the average annualized cost per event in daycare center buildings is $490

(see Table 6-23). Multiplying this average cost by the total 50-year average annual number of events in

daycare centers that perform their own work yields the total annualized event costs incurred by these

centers in an average year. Since centers are assumed to perform no more than one event per year, the

annual number of events is equal to the number of centers performing dust wipe testing or clearance in an

average year. These average total and per-center costs are presented in Table 6-43.

Table 6-43: 50-Year Average Annualized Dust Wipe Testing and Clearance Costs for Small

Non-Profit Daycare Centers

Regulatory Option Total In-House

Events

Annualized

Avg. Cost per

Event

Total Event

Costsa

Average DWT and

Clearance Costs per

Small Center

Proposed rule 132 $490 $64,776 $490

a. Total costs are calculated using unrounded unit costs of third party dust sampling services; a 3 percent

discount rate is used.

6.2.6.3 Non-Profit Daycare Center Expenditures

In analyzing impacts of the proposed LRRP Clearance Rule on an entity, the analysis conceptually should

compare rule costs to the revenues or expenditures of an entire organization. As such, costs of the rule to

non-profit daycare centers should be compared to the revenues or expenditures of the parent organization

(such as the religious organization that operates them), rather than a single center. Due to a lack of data

both on the structure of these organizations and on their finances, such a comparison was not possible.

Instead, this analysis is based on daycare center revenues. Ten state childcare industry impact studies

were reviewed to obtain daycare center revenue data.12 Nine of these studies did not differentiate between

revenues of non-profit and for-profit centers. The Virginia Economic Impact of the Child Care Industry

report (Voices of Virginia’s Children 2004), however, provided revenue data specific to religiously

affiliated daycare centers. The state reported annual total revenues of $236 million for its 929 religious

daycare facilities or average revenues (inflated to 2008$) of $317,062 (U.S. Bureau of Labor Statistics

2006). This figure was used to measure the incremental impacts of the proposed LRRP Clearance Rule

on non-profit centers.

6.2.6.4 Impacts on Non-Profit Daycare Centers

The impacts on non-profit daycare centers were estimated by first dividing total annualized costs incurred

by these entities by the number of centers. Average costs per center were then divided by average

revenues to calculate a cost-to-revenue ratio. These calculations and the resulting ratios are presented in

Table 6-44.

12 Data were available for the following states: Oklahoma, New Jersey, Iowa, Hawaii, Ohio, Kansas, South Carolina,

West Virginia, Louisiana, Virginia, New York, South Dakota, Indiana, Maine and Massachusetts.

Table 6-44: Cost-to-Revenue Ratios for Non-Profit Daycare Centers

Regulatory

Option

Total Daycare

Centers Affected

Total Cost of Rule

to Daycare

Centers

Average Cost of

Rule per Daycare

Center

Estimated Average

Daycare Center

Revenues

Cost-toRevenue Ratio

Proposed rule 132 $64,776 $490 $317,062 0.154%

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6.2.7 Public Schools (Small Governments)

The RFA defines a small government jurisdiction as the government of a city, county, town, school

district or special district with a population of less than 50,000. This economic analysis relies on National

Center for Education Statistics (NCES) Common Core of Data (CCD) survey data to estimate the number

of school districts that have schools with pre-kindergarten or kindergarten programs, the number of such

schools per district, and district revenues.13 Furthermore, for most districts, a cross-reference system with

the 2000 Decennial Census provides a means for estimating the size of the population served by the

district.

6.2.7.1 Number of Small Public School Districts Affected by the Proposed LRRP Clearance Rule

Number of Small Public School Districts

As discussed in Chapter 2, there are approximately 18,000 public school districts in the United States.

Based on CCD data, 14,473 of these school districts have at least one school with a kindergarten or pre-K

program; in total, these districts have 52,129 such schools (NCES 2006b,c). Of the 14,473 school

districts, 13,330 serve a population of fewer than 50,000 people. These 13,330 districts have a total of

26,779 schools with kindergartens or pre-kindergartens (NCES 2006b,c,g). These counts are not limited

to pre-1978 schools.

Since the Regulatory Flexibility Analysis is only concerned with the direct costs of regulation, this small

entity analysis only considers the costs that school districts will incur if they perform regulated

renovation, repair, or painting projects using their own maintenance staff instead of hiring a contractor.

Costs and impacts associated with work performed by a contractor are accounted for in the contractor

section of this analysis.

As discussed in Chapter 4, this analysis assumes that public schools will perform all painting and

carpentry events using in-house staff.14 Thus, small school districts that have at least one pre-1978

building may incur costs under the proposed rule.

Number of Small Public Schools Affected by the Proposed LRRP Clearance Rule

The number of small school districts with at least one building regulated under the 2008 LRRP Rule was

estimated based on the number of school buildings in the district and the likelihood that any one of the

buildings is old enough to be regulated. Using 2003 HUD data, 58 percent of school buildings are

estimated to have been built before 1978, and 55 percent of the pre-1978 buildings are estimated to have

built before 1960 (U.S. HUD 2003). Thus, for example, the probability that any particular school

building was built after 1978 is 0.42 (1-0.58). The likelihood that a district has no pre-1978 buildings is a

function of the number of buildings and 0.42 as follows15:

(0.42)^X, where X is the number of schools with kindergarten or pre-kindergarten in the district

13 It is possible that government agencies also operate some of the childcare facilities included in the daycare center

counts throughout this economic analysis. Due to insufficient data, it was not possible to estimate the number

of such government-run facilities, or the number or size of the agencies that operate them. As such, this small

government impact analysis is limited to public school districts.

14 The analysis assumes that all electrical, plumbing and HVAC work are contracted out.

15 It is assumed that the age of each building is independent of the age of all other buildings in the district. This may

somewhat overestimate the number of districts that have at least one pre-1978 buildings. But data are not

available to calculate the joint probabilities.

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For example, a district with three buildings has a (0.42)*(0.42)*(0.42) = 0.074 probability of containing

no pre-1978 buildings. Using this approach, 92.6 percent of districts with three buildings are estimated to

have at least one building that is pre-1978. To estimate the average number of pre-1978 buildings in a 3-

building district with at least one pre-1978 building, the total number of buildings in 3-building districts

was multiplied by the percent of all schools constructed before 1978 (58 percent) and divided by the

number of districts with at least one pre-1978 building.

Table 6-45 presents the 50-year average numbers of small school districts with at least one pre-1978

building and the average number of buildings in these districts. The use of 50-year average, rather than

first or second year numbers accounts for the fact that, after the first year, the numbers of regulated

districts and pre-1978 schools are expected to decrease by 0.41 percent per year due to building

demolition.

Although 10,552 buildings in small public school districts are regulated under the 2008 LRRP Rule, only

a fraction of these buildings will undergo renovation requiring dust wipe testing or clearance in a typical

year. It is estimated that an average of 257 public school buildings (large and small) will be affected by

the proposed rule in a typical year. Based on the number of buildings in small districts relative to the total

number of public school buildings, 132 public school buildings in small districts are expected to be

affected by the rule in a typical year. Given the relative infrequency of dust wipe testing and clearance

events, each affected small public school district is assumed to perform no more than one event per year.

Thus, 132 public school districts are expected to be affected by the rule in a typical year.

6.2.7.2 Dust Wipe Testing and Clearance Costs – Public Schools

Since each affected public school district is assumed to perform one event per year, the estimation of

costs incurred by each affected district is based on the average costs per event. The analysis in Chapter 4

demonstrated that public schools are not expected to typically perform enough dust wipe testing or

clearance events annually to justify obtaining dust sampling technician training for one of their

employees. Instead, public schools are assumed to incur only third party dust wipe testing and clearance

costs for the events that they perform.

Total Clearance Rule Costs – Public Schools

As discussed in 6.2.2, the average annualized cost per event in public schools is $766 (see Table 6-23).

Multiplying this average cost by the average annual number of events in small school districts yields the

total annualized event costs incurred by small districts in a typical year. These costs, and resulting

average costs per district, are presented in Table 6-46.

Table 6-45: Number of Regulated School Districts and Public School Buildings

Number of School

Districts with at Least 1

Regulated Building a

Total Number of

Regulated Buildings

in these Districts

Average Number of

Regulated Buildings

per District

Total Districts 7,051 20,541 2.9

Small Districts 6,492 10,552 1.6

a. A regulated building is defined as having a kindergarten or pre-kindergarten program.

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Table 6-46: Average Annualized Dust Wipe Testing and Clearance Costs for Public

Schools in Small Districts

Regulatory Option Total In-House

Events

Annualized

Avg. Clearance

Cost per Event

Total Event

Costs a

Average Event

Costs per Small

District

Proposed rule 132 $766 $101,077 $766

a. Total costs are calculated using unrounded unit costs of third party dust sampling services; a 3 percent

discount rate is used.

6.2.7.3 Public School Revenues

The impact of the proposed rule on small government jurisdictions is estimated by comparing the

estimated incremental costs of the proposed rule to the annual government revenues of small regulated

jurisdictions. Revenue data for school districts is available from NCES’s Common Core of Data “Local

Education Agency (School District) Finance Survey (F-33)” dataset (NCES 2006d). Small districts

include local school boards, supervisory unions, regional education agencies, and other agencies, which

primarily include charter schools. Revenue data are available for the vast majority of districts. Average

revenues for all small districts were estimated by a) calculating the average revenues of each type of

district based on available data, b) multiplying the average revenues by the total number of districts of

that type, then c) calculating the sum of the resulting total revenues and dividing by the total number of

small districts. This approach presumes that there is no non-response bias among districts within each

category.

Table 6-47 presents small district revenue calculations and resulting estimates. The total estimated

average revenues in column 7 ($15.5 million) are adjusted to 2008 dollars before being used to estimate

cost-to-revenue ratios in Section 6.2.7.4.

Table 6-47: Estimated Annual Revenues for Small Public School Districts (2005$)

District Type

Total

Small

Districts

Small

Districts w/

Revenue Data

Total Small

District Revenues

Reported

(Million $)

Average

Reported

Revenues

(Million $)

Estimated

Total

Revenues

(Million $)

Estimated

Average

Revenues

(Million $)

Local School District

(A)a

10,930 10,868 $179,530 $16.5 $180,554 $16.5

Local School District

(B) a1,200 1,197 $13,926 $11.6 $13,961 $11.6

Supervisory Union 84 76 $1,186 $15.6 $1,311 $15.6

Regional Education

Agency 167 158 $7,612 $48.2 $8,046 $48.2

Other (Charter School) 949 773 $2,074 $2.7 $2,546 $2.7

Total 13,330 13,072 $204,329 $15.6 $206,419 $15.5

a. There are two different types of local school districts in NCES data – independent districts and districts that

are connected to a supervisory union office. These local school districts are combined in Chapters 2 and 4,

but are treated separately in estimating weighted average revenues.

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6.2.7.4 Impact of the Proposed LRRP Clearance Rule on Small Public School Districts

Table 6-46 presents the total annualized event costs incurred by small public school districts as well as the

average annualized costs per small district. Average annualized costs are then divided by annual district

revenues, as shown in Table 6-48, to obtain a cost-to-revenue ratio.

Table 6-48: Cost-to-Revenue Ratios for Small Public School Districts (2008$)

Regulatory

Option

Total Affected

Small Districts

Total Cost of Rule

to Small Districts

Average Cost of

Rule per Small

District

Estimated Average

Small District

Revenues

(Million $)

Cost-toRevenue Ratio

Proposed rule 132 $101,077 $766 $17,071,289.68 0.004%

6.2.8 Private Schools (Small Non-Profits)

6.2.8.1 Number of Small Private Schools

As discussed in Chapter 2, according to the 2003-2004 NCES Private School Universe Survey Data, there

are a total of 26,531 private schools with kindergarten or pre-kindergarten programs in the United States

(NCES 2006e,f). Based on HUD data, 58 percent, or 15,387 of these schools were constructed before

1978. Because no data source providing the number of private schools at different revenue levels was

identified, all private schools are considered to be small entities. In other words, the analysis assumes that

each private school is independently run and is not part of a larger organization. As such, the analysis

may overestimate the number of affected non-profit organizations and the impacts of the rule on these

entities.

Similar to public schools, private schools will only incur direct costs as a result of this rule if they use

their own maintenance staff to perform regulated RRP work. Schools that perform regulated jobs inhouse will incur dust wipe testing and clearance costs as a result of the proposed rule. This analysis

assumes that private schools with fewer than 100 students will contract out all of their renovation and

repair work because of their small size, and costs and impacts associated with work performed by a

contractor are accounted for in the contractor section of this analysis. Private schools serving more than

100 students are assumed to use their own staff to perform all painting and window/door carpentry work

and to hire contractors to perform all other regulated RRP activities.

As discussed in detail in Chapter 2, based on NCES’s Private School Universe survey data, 41 percent of

private schools with a kindergarten and/or pre-kindergarten have fewer than 100 students. Table 6-49

presents the total number of private schools regulated in a typical year, the number of schools with fewer

than 100 students, and the number of schools with more than 100 students. The use of average annual

numbers accounts for the fact that after the first year, the numbers of pre-1978 schools are expected to

decrease by 0.41 percent per year due to building demolition.

Table 6-49: Average Annual Number of Private Schools with Kindergarten or PreKindergarten

Regulatory Option

Total Number of

Private Schools with

Kindergarten or

Pre-Kindergarten

Percent of

Private

Schools with

<100 Students

Number of

Private Schools

with <100

Students

Number of

Private Schools

with >100

Students

Proposed rule 10,454 41% 4,280 6,174

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Although 6,174 private schools are regulated under the 2008 LRRP Rule, only a fraction of these

buildings will undergo renovation requiring dust wipe testing or clearance in a typical year. It is

estimated that an average of 81 private school buildings doing RRP work in-house will be affected by the

proposed rule in a typical year.

6.2.8.2 Dust Wipe Testing and Clearance Costs – Private Schools

Given the relative infrequency of dust wipe testing and clearance events, each affected private school is

assumed to perform one event per year. The analysis in Chapter 4 demonstrated that private schools are

not expected to typically perform enough dust wipe testing or clearance events annually to justify

obtaining dust sampling technician training for one of their employees. Instead, private schools are

assumed to incur only third party dust wipe testing and clearance costs for the events that they perform.

Table 6-50 presents the total number of private schools regulated in the first year, the total number of

events performed in these schools, and the total annualized costs associated with these events. Total costs

are estimated by multiplying the average annual number of events by the average annualized cost per dust

sampling or clearance event ($789; see Table 6-23). Average annualized costs per private school are

calculated by dividing total rule costs by the number of affected schools.

6.2.8.3 Impact of the Proposed LRRP Clearance Rule on Private Schools

Conceptually, impacts on non-profit establishments such as schools might be measured in terms of the

ratio of rule costs to annual operating expenses. Due to the scarcity of data on private school operating

expenditures (schools are excluded from the U.S. Economic Census, and NCES does not have a financial

data set for private schools), annual private school expenditures are approximated based on estimated

operating expenses per student obtained from a 1995 study by NCES entitled Estimates of Expenditures

for Private K-12 Schools and information on the number of students enrolled at each school as reported in

NCES’s 2003-2004 Private School Universe Survey data set.

Based on NCES data (1995), this analysis estimates that private school expenditures average about $3,727

(2008$) per child per year. Appendix 6A explains the derivation of this estimate in detail.

To estimate average private school expenditures for schools with over 100 students operating prekindergarten or kindergarten programs, the average number of students per school meeting this criteria

was calculated based on 2003-2004 NCES survey data (NCES 2006f). Schools for which no total student

enrollment data was available were assumed to have the average enrollment at schools with more than

100 students where student data was provided. Using these assumptions, the average private school with

over 100 students was estimated to serve 283 students per year. As such, average expenditures for private

schools are estimated to be $3,727*283, or $1,054,684.

Table 6-50: Average Dust Wipe Testing and Clearance Costs for Private Schools

Discount Rate

Number of

Private Schools

w>100 Students

Total Annual

Number of Inhouse Events

Total Annualized

Event Costs a

Average

Annualized Event

Costs per School

Proposed rule 81 81 $63,586 $789

a. Total costs are calculated using unrounded unit costs of third party dust sampling services; a 3 percent

discount rate is used.

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Impacts on private schools were estimated by dividing the total annualized dust sampling and clearance

costs incurred by these schools by the number of regulated schools. Average costs per school were then

divided by average expenditures to calculate a cost-to-expenditure ratio. These calculations and the

resulting ratio are presented in Table 6-51.

Table 6-51: Cost-to-Expense Ratios for Private Schools

Regulatory

Option

Total Affected

Private Schools

with > 100 kids

Total Cost of Rule

to Private Schools

Average Cost of

Rule per Private

school

Estimated Average

Small School

Expenditures

Cost-toExpenditure

Ratio

Proposed rule 81 $63,586 $789 $1,054,684 0.075%

6.2.9 Summary of the Proposed LRRP Clearance Rule Impacts on Small Governments,

Non-Profit Organizations, and Small For-Profit Businesses

The vast majority of entities in the industries affected by the proposed rule are small. As a result of the

proposed revisions, approximately 203,002 small entities would incur additional costs.

6.2.9.1 Incremental Impacts of the Proposed Rule

The average annualized incremental cost of the proposed rule to a typical small entity is estimated to

range from $490 to $1,928 depending on the number of renovation, repair, and painting events undertaken

by a small entity in the industry sector involved. As shown in Table 6-52, the incremental cost impact of

the proposed LRRP Clearance Rule on small currently regulated entities ranges from about 0.004 percent

to 1.059 percent of revenues, depending on the industry sector.

Table 6-52: Typical-Year Number of Small Entities with RRP Events

Description Entity Type Number of

Small

Entities

Cost-Impact

Ratio

Public and Commercial Building Child-Occupied Facilities

Public School Districts Government 132 0.004%

Private Schools Non-Profit 81 0.075%

Daycare Centers Non-Profit 132 0.154%

Non-Residential Landlords Business 140 0.352%

Non-Residential Contractors (working in public or

commercial building COFs)

Business

281 0.433%

Residential Contractors (working in target housing)

Residential remodelers Business 68,428 0.469%

Finish carpentry contractors Business 48,590 0.819%

Tile and terrazzo contractors Business 6,940 0.719%

Plumbing and HVAC contractors Business 23,352 0.400%

Painting and wall covering contractors Business 26,970 1.059%

Electrical contractors Business 16,603 0.497%

Drywall and insulation contractors Business 11,355 0.527%

Total 203,002 0.516%

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Table 6-53 presents the total number of small governments, non-profit organizations, and small for-profit

businesses, and the average cost-to-revenue ratios for each category. It is estimated that a total of 203,002

small entities would be affected by the program, including 202,657 small businesses with average impacts

of 0.544 percent, 213 small non-profits with average impacts of 0.101 percent, and 132 small

governments with average impacts of 0.004 percent.

Table 6-53: Aggregate Small Entity Impacts

Total Number of Small

Entities Affected

Average Impacts,

All Small Entities

Small Governments 132 0.004%

Non-Profit Organizations 213 0.101%

Small For-Profit Businesses 202,657 0.544%

Total 203,002 0.516%

6.3 Unfunded Mandates Reform Act (UMRA)

Title II of the Unfunded Mandates Reform Act of 1995, Pub. L. 104-4, establishes requirements for

Federal agencies to assess the effects of their regulatory actions on State, local, and Tribal governments,

and the private sector. Under section 202 of the UMRA, EPA generally must prepare a written statement,

including a cost-benefit analysis, for rules with “Federal mandates” that might result in expenditures by

State, local, and Tribal governments, in the aggregate, or by the private sector, of $100 million or more

(when adjusted annually for inflation) in any one year.16

Before promulgating a regulation for which a written statement is needed, section 205 of the UMRA

generally requires EPA to identify and consider a reasonable number of regulatory alternatives and adopt

the least costly, most cost-effective, or least burdensome alternative that achieves the objectives of the

rule. The provisions of section 205 do not apply when they are inconsistent with applicable law.

Moreover, section 205 allows EPA to adopt an alternative other than the least costly, most cost-effective,

or least burdensome alternative if the Administrator publishes with the rule an explanation of why that

alternative was not adopted. Before EPA establishes any regulatory requirements that might significantly

or uniquely affect small governments, including Tribal governments, it must have developed under

section 203 of the UMRA a small government agency plan. The plan must provide for notifying

potentially affected small governments, enabling officials of affected small governments to have

meaningful and timely input in the development of EPA regulatory proposals with significant

intergovernmental mandates, and informing, educating, and advising small governments on compliance

with regulatory requirements. This section identifies the government entities that may be affected by the

proposed revisions to the 2008 LRRP rule.

6.3.1 Affected Government Entities

The proposed revisions to the 2008 LRRP rule will affect activities in publicly owned child-occupied

facilities, specifically publicly owned housing and public schools.

17 As with the private sector, the

16 When the original $100 million UMRA threshold is adjusted for inflation from 1995 to 2008 dollars using an

implicit price deflator for gross domestic product, the result is a threshold of $130 million.

17 It is possible that government agencies also operate some of the childcare facilities included in the daycare center

counts throughout this economic analysis. Due to insufficient data, it was not possible to estimate the number

of such government-run facilities, or the number or size of the agencies that operate them. As such, this

Unfunded Mandates Reform Act discussion is limited to public school districts.

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proposed LRRP Clearance Rule will increase the cost of operating these facilities by requiring dust wipe

testing or clearance after a subset of their in-house renovation activities. Each school district that uses its

own in-house staff to perform covered RRP activities in regulated buildings is required to comply with

the Clearance Rule provisions. Since the cost comparison in Chapter 4 indicated that public schools are

not likely to choose to obtain training for an in-house dust sampling technician, state and local

governments will only incur incremental costs of paying for third party dust wipe testing and clearance

services following the affected renovation events.

While most of what is commonly referred to as public housing is owned by state or local governments

and provided for the benefit of low-income and/or elderly households, other public entities (such as public

colleges and universities) may provide housing regulated under the LRRP rule. As with the private

sector, the proposed LRRP Clearance Rule will increase the cost of operating this housing by requiring

that dust wipe testing and clearance be performed. The increased cost is estimated to be $167 on average

per renovation in Target Housing.

18

6.3.2 Expenditures by State, Local, and Tribal Governments – Public School Districts

State, local, and Tribal governments will incur the incremental costs imposed by the proposed revisions to

the 2008 LRRP rule when public school districts engage in certain RRP activities.19 Based on available

data and the economic analysis presented in Chapter 4 and Section 6.1, it is assumed that all public school

districts will perform all painting and window/door carpentry tasks themselves. Public schools are

assumed to hire third-party contractors to perform the remainder of their RRP work. Since all public

school districts are assumed to use their own staff to perform some of their RRP activities, all public

school districts would need to comply with the dust wipe testing and clearance requirements outlined in

Chapter 4.20 Although 7,051 districts and 20,541 buildings were regulated under the 2008 LRRP Rule,

the very low expected number of dust wipe testing and clearance events in public and commercial

building COFs implies a lower number of affected entities. The number of districts affected by the

proposed LRRP Clearance Rule is estimated as the annual average number of buildings performing an inhouse RRP event which would require dust wipe testing or clearance. Table 6-54 presents the estimated

total annualized incremental costs of the proposed rule that would be incurred by public school districts

under the proposed option.

18 This average cost is calculated as the total target housing event costs in the first year divided by the total number

of target housing events in the first year.

19 As discussed in Chapter 4, states would be able to apply for, and receive authorization to administer these

proposed requirements, but would be under no obligation to do so.

20 It is important to note that this analysis uses a 75 percent compliance rate. See Chapter 4 and the small entity

analysis (Section 6.1) for a more comprehensive discussion of these cost estimates.

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The cost to revenue ratio for affected school districts is 0.002 percent under the proposed option. These

calculations are summarized in Table 6-55.

Table 6-55: Cost-to-Revenue Ratios for Affected Public Schools (2008$)

Regulatory

Option

Average

Annual

Regulated

Districts

Total

Annualized Cost

of Rule to

Districts a

Average

Annualized Cost

of Rule per

District

Estimated

Average District

Revenues (mil)

Cost-toRevenue Ratio

Proposed 257 $196,762 $766 $35.2 0.002%

a. Total costs are calculated using un-rounded unit costs; a 3 percent discount rate is used.

6.4 Executive Order 13132 - Federalism

Executive Order 13132, entitled Federalism (64 FR 43255, August 10, 1999), directs federal agencies to

consider whether a rule has federalism implications (i.e. whether it has substantial direct effects on the

states, on the relationship between the national government and the states, or on the distribution of power

and responsibilities among the various levels of government, as specified in Executive Order 13132).

As discussed in Chapter 4, states would be able to apply for and receive authorization to administer these

requirements but would be under no obligation to do so. In the absence of a state authorization, EPA will

administer these requirements. While the cost analysis assumes that EPA will administer and enforce the

program in all places, it also assumes that states would incur similar costs if they administer and enforce

the regulation. To the extent that they operate target housing or child-occupied facilities, states may incur

costs due to the requirement that dust wipe testing and clearance procedures be followed after certain

high-dust-generating renovation activities. Given the low frequency of these events, this rule is not

expected to have a significant impact on states.

6.5 Executive Order 13175 - Tribal Implications

Executive Order 13175, entitled Consultation and Coordination with Indian Tribal Governments (59 FR

22951, November 6, 2000), directs federal agencies to consider whether a rule has tribal implications (i.e.

whether it has substantial direct effects on tribal governments, on the relationship between the Federal

government and the Indian tribes, or on the distribution of power and responsibilities between the Federal

government and Indian tribes).

Table 6-54: Total Annualized Incremental Costs to All Public School Districts

Regulatory

Option

Average

Annual

Number of

Districts

Affected a

Average

Annual

Number of

Buildings

Affected a

Total Average

Annual

Number of

Events

Average

Annualized

Cost Per

District

(2008$)

Total

Annualized

Cost (2008$) b

Proposed

option

257 257 257 $766 $196,762

a. In the first year, the proposed LRRP Clearance Rule is expected to affect 283 public school districts and buildings.

Every year thereafter, the number of affected districts and schools is expected to decrease by 0.41 percent as older

buildings are demolished. The use of 50-year average numbers of districts and schools captures this annual decrease.

b. Total costs are calculated using un-rounded unit costs; a 3 percent discount rate is used.

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Under the proposed LRRP Clearance Rule, Tribes would be able to apply for and receive authorization to

administer these requirements on Tribal lands, but Tribes would be under no obligation to do so. In the

absence of a Tribal authorization, EPA will administer these requirements.

To the extent that Tribes operate target housing or child-occupied facilities, they may incur costs due to

the requirement that dust wipe testing and clearance procedures must be followed after certain high-dustgenerating renovation activities. Given the low frequency of these events, this rule is not expected to

have a significant impact on Tribal Governments.

6.6 Protection of Children from Environmental Health Risk and Safety Risks

Under Executive Order 13045, a regulation must be reviewed if the regulatory action is economically

significant and concerns an environmental health risk or safety risk that may disproportionately affect

children. Since children are particularly susceptible to the IQ loss and adverse health effects caused by

exposure to lead dust, a significant objective of the proposed revisions to the 2008 LRRP rule is the

protection of children’s health. Implementing the Clearance Rule provision protects children under the

age of six by ensuring that their homes, schools, or daycares, are truly free from lead hazards before a

child may re-occupy the space. This analysis summarizes the effects of the regulation on children under

the age of six in target housing units and in COFs in public or commercial buildings.

6.6.1 Children Affected by the Proposed Clearance Rule Revision

The 2008 LRRP Rule included all COFs in public and commercial buildings, all rental units, plus all

target housing COFs, and all owner-occupied target housing units where a child under the age of 6 or a

pregnant woman resides within pre-1987 buildings. A target housing unit where a child visits regularly,

but spends fewer that 6 hours a week is not considered a child-occupied facility, and will only be

regulated if the opt-out provision is eliminated as has been proposed (providing that there is no child

under the age of six or pregnant woman that resides in the unit). Thus, children visiting these housing

units may also benefit from the proposed LRRP Clearance Rule through a reduction in potential

exposures to lead dust during these visits.

It is expected that the proposed LRRP Clearance Rule will benefit children both located in target housing

and public and commercial building COFs. Increasing the awareness of lead hazards through dust wipe

testing reports and ensuring elimination of hazards prior to re-occupancy through clearance testing will

increase the health outcomes of these groups of children. In the first year of the proposed rule, 1.1 million

children are expected to reside or occupy (i.e., receive childcare or attend school in) structures where dust

wipe testing or clearance was performed following a renovation that disturbed lead based paint.

6.7 Executive Order 13211 - Energy Effects

Executive Order 13211, entitled Actions Concerning Regulations that Significantly Affect Energy Supply,

Distribution, or Use (66 FR 28355, May 22, 2001), directs federal agencies to identify actions that will

have a significant adverse energy effect. Adverse effects are defined as:

 Reductions in crude oil supply in excess of 10,000 barrels per day;

 Reductions in fuel production in excess of 4,000 barrels per day;

 Reductions in coal production in excess of 5 million tons per year;

 Reductions in natural gas production in excess of 25 million mcf per year;

 Reductions in electricity production in excess of 1 billion kilowatt-hours per year or in excess of

500 megawatts of installed capacity;

 Increases in energy use required by the regulatory action that exceed any of the thresholds above;

 Increases in the cost of energy production in excess of one percent;

 Increases in the cost of energy distribution in excess of one percent; or

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 Other similarly adverse outcomes.

The regulations under consideration will not significantly reduce energy production nor significantly

increase energy costs.

6.8 National Technology Transfer and Advancement Act

Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (“NTTAA”), Public

Law No. 104-113, 12(d) (15 U.S.C. 272 note) directs federal agencies to use voluntary consensus

standards in its regulatory activities unless to do so would be inconsistent with applicable law or

otherwise impractical. Voluntary consensus standards are technical standards (e.g., materials

specifications, test methods, sampling procedures, and business practices) that are developed or adopted

by voluntary consensus standards bodies. The NTTAA directs federal agencies to provide Congress,

through OMB, explanations when the Agency decides not to use available and applicable voluntary

consensus standards.

This proposed rulemaking does not involve technical standards. Therefore, EPA is not considering the use

of any voluntary consensus standards.

6.9 Executive Order 12898 – Environmental Justice

Under Executive Order 12898, when promulgating a regulation, EPA investigates whether there are

disproportionately high and adverse human health or environmental effects on minority and low-income

populations. The LRRP regulation requires that establishments, when undertaking certain types of

renovation activities in regulated facilities, reduce the risk of exposure to lead by using dust wipe testing

and clearance practices following cleaning verification to ensure the safety of the work area prior to reoccupancy. This environmental justice analysis first summarizes a few important points to consider when

viewing the results. Next a summary of the impacts from the regulation on minority and low-income

populations in target housing units and child-occupied facilities is presented. Racial minorities and lowincome households stand to accrue benefits as a result of the proposed revision to the LRRP rule.

The dust wipe sampling, laboratory testing, report-writing, and re-cleaning required by the proposed rule

will increase the costs for renovation, repair and painting activities that are already regulated under the

2008 LRRP rule and the subsequent proposed Opt-Out rule. These additional costs may lead some lower

income homeowners of properties in lower income neighborhoods to avoid using certified renovators or

recommended practices. When taking an average of costs to all residential RRP events in target housing

affected by the rule, the incremental costs of the dust wipe testing and clearance requirements would be

$160.

21 These costs are likely to be a small part of the total cost of the major renovation, repair, and

painting projects that are affected by the proposed rule. EPA believes that these costs are unlikely to

result in significant changes in consumer behavior.

6.9.1 Target Housing Dust Wipe Testing and Clearance Events

This section evaluates the distribution of regulated renovation events in target housing units and the

individuals protected across three race and two income groups. Although it would be preferable to

perform a joint environmental justice analysis for the race and income groups, relevant data are not

available to make these population inferences. Therefore, the analysis was performed separately for the

race and income groups.

21 This average cost is calculated as the total target housing event costs in the first year divided by the total number

of target housing events in the first year.

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6.9.1.1 Low Income

EPA defines low income individuals as individuals whose income are below the level set by the federal

government’s official poverty definition. Based on data from the 2000 Decennial Census, 12.4% of

individuals were living below the poverty level (U.S. Census Bureau 2000a). The analysis evaluates

whether implementation of the LRRP Clearance Rule revision will have a disproportionately greater

effect on low income individuals.

For the purposes of the target housing portion of this analysis, EPA defines low income individuals as

individuals whose income are below the level set by the federal government’s official poverty definition.

Based on data from the 2000 Decennial Census, 12.4% of individuals were living below the poverty level

(U.S. Census Bureau 2000a). It is therefore relevant to determine if the potential costs and benefits

resulting from the LRRP regulations will have a disproportionately greater effect on low income

individuals.

The data in Table 6-56 presents the numbers of households below the poverty level that own or rent their

home. As a result of the proposed LRRP Clearance Rule revision, the likelihood of high levels of lead

dust remaining in residential housing post-renovation decreases significantly, and occupants become more

aware of potential lead hazards. Only households built prior to 1978 would potentially be affected by the

proposed revisions. About 4.5 percent of pre-1980 owner-occupied housing units have residents below

the poverty line.

Table 6-56: Annual Number of Children that are Protected by the Clearance Rule Revision

Owner-Occupied Housing Renter-Occupied Housing

Year

Housing

Built

Total Below Poverty

Percentage of All Pre2000 Owner Housing

Below Poverty

Total Below Poverty

Percentage of All Pre2000 Rental Housing

Below Poverty

Pre-2000 4,371,712 6.26% 8,086,254 22.67%

Pre-1980 3,133,302 4.49% 6,059,817 16.99%

Pre-1960 1,765,185 2.53% 3,100,214 8.69%

Pre-1950 1,167,604 1.67% 2,093,142 5.87%

Source U.S. Census Bureau 2000b.

6.9.1.2 Race:

This section of the environmental justice analysis considers the impacts of the proposed revisions across

three race categories. The data in Table 6-57 compares the percentages of owners and renters for three

categories of race, “White Alone,” “Black/African American Alone,” and “Asian Alone.” The 2000

Census data shows that Black/African American households and Asian households are almost as likely to

reside in owner housing as rental housing.

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6.9.2 Conclusions

The proposed rule seeks to provide greater assurance that dust-lead hazards created by renovations are

adequately cleaned up, primarily by requiring renovation firms to provide building owners and occupants

with information on dust lead levels remaining in the work area after many renovation projects, but also

by requiring renovation firms to demonstrate that they have achieved regulatory clearance levels after

some of the dustiest renovations. As such, EPA concludes that the proposed revisions to the rule will not

lead to disproportionately high and adverse human health or environmental effects on minority and low

income populations in regulated target housing units.

Table 6-57: Number and Percentage of Householders by Race by Tenure in 2000

Race Total Percentage Owner Percentage Renter

White Alone 83,715,168 71.27% 28.73%

Black/African American Alone 11,977,309 46.33% 53.67%

Asian Alone 3,117,356 53.24% 46.76%

Source U.S. Census Bureau 2000c.

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APPENDIX 6A – Estimating average per-pupil expenditures of private schools

This appendix outlines the methodology used to estimate total annual private school expenditures for the

small entity analysis. Total annual school expenditures were estimated based on per-student operating

expense data and information on the number of students enrolled. This analysis used per-pupil

expenditure values for 1991-92, first calculated in a working paper published by the National Center for

Education Statistics (NCES) entitled “Estimates of Expenditures for Private K-12 Schools” (NCES 1995).

The two mean per-pupil expenditure values (one for elementary schools and one for combined schools)

presented were combined into one value - the private school per-pupil expenditure value - using selected

weights. Finally, this value was inflated to 2005 dollars using the CPI. The inflated value was used to

estimate the total expenditures of private schools with various sized student bodies.

The NCES working paper divided 1991-92 Private School Survey (PSS) data into 19 mutually exclusive

and exhaustive sectors of schools based on grade level (elementary, secondary, and combined elementary

and secondary), and religious or other affiliation. The paper relied on expenditure data collected by three

school associations (The National Catholic Education Association (NCEA), the Lutheran ChurchMissouri Synod (LCNS), and the National Association of Independent Schools (NAIS)) to calculate

average annual per-student expenditures for their associated schools. Data from the three surveyed school

associations accounted for 45% of the total private school as presented in the PSS (NCES 1995). For the

remaining schools, NCES estimated two sets of per-student expenditures using data obtained from

Catholic and Lutheran schools (referred to as the Catholic and Lutheran School Models, respectively).

Table 6A-1 presents the number of schools and the annual per-student expenditures for the 19 sectors of

schools using the Lutheran school data to estimate missing expenditure values.

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Table 6A-1: Estimated Per-pupil Expenditures of Private Schools by

School Level and School Type (Based on the Lutheran Model)

School Level and

School Type Number of Schools

Estimated Mean Per Pupil

Expenditures

Elementary Schools

Catholic 7,645 $1,895

Lutheran 1,563 $2,003

NAIS Religious 124 $6,313

NAIS Non-Sectarian 325 $8,807

Other Religious 5,240 $2,003

Other Non-Sectarian 2,084 $2,003

Special Education 114 $8,807

All Schools 17,093 $2,125

Secondary Schools

Catholic 1,244 $3,909

Lutheran 87 $4,527

NAIS Religious 91 $16,523

NAIS Non-Sectarian 208 $58,730

Other Religious 477 $4,527

Other Non-Sectarian 342 $4,527

Special Education 171 $17,261

All Schools 2,620 $5,510

Combined Schools

NAIS Religious 95 $9,052

NAIS Non-Sectarian 346 $9,662

Other Religious 4,085 $4,527

Other Non-Sectarian 943 $4,527

Special Education 817 $9,662

All Schools 6,285 $5,766

Sources NCES 1995

The per-student expenditure estimates presented are based on the Lutheran School Model rather than the

Catholic School Model because, based on the evidence presented in NCES’s study, Lutheran school data

are likely to be more accurate. Specifically, when assessing the quality of the data, the working paper

authors express concern over potential non-response bias and sampling error in the Catholic elementary

and secondary school data. In addition, a comparison of the total operating expenses of private

elementary and secondary schools generated by each model with an alternate estimate calculated annually

by NCES indicated that while that both the Catholic and the Lutheran School Model estimates are below

the alternative NCES estimates, the Lutheran School Model is the closer of the two.22 Therefore the

Lutheran School Model was used in this analysis.

To estimate per-student expenditures for schools likely to be affected by the proposed revisions to the

LRRP Rule, the school sectors most likely to contain schools with pre-kindergarten and kindergarten

22 The NCES estimate inflates private school data collected in the late 1970’s.

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programs were identified in the NCES study. Table 6A-2 shows Table 6A-1 with an additional column

indicating whether or not the estimated mean for that sector was included in the calculation for mean perprivate-school-pupil expenditure based on the assumptions made about the likelihood of that sector

containing a kindergarten or pre-kindergarten program. An “x” indicates that the mean per-pupil

expenditure value is included in the calculation.

Table 6A-2: Estimated Per-pupil Expenditures of Private Schools by School

Level, School Type, and Inclusion in the Calculation (Based on Lutheran

School Model)

School Level and

School Type Number of Schools

Estimated Mean Perpupil ExpendituresIncluded in the

Calculation

Elementary Schools

Catholic 7,645 $1,895

Lutheran 1,563 $2,003 x

NAIS Religious 124 $6,313

NAIS Non-Sectarian 325 $8,807

Other Religious 5,240 $2,003 x

Other Non-Sectarian 2,084 $2,003 x

Special Education 114 $8,807

All Schools 17,093 $2,125

Secondary Schools

Catholic 1,244 $3,909

Lutheran 87 $4,527

NAIS Religious 91 $16,523

NAIS Non-Sectarian 208 $58,730

Other Religious 477 $4,527

Other Non-Sectarian 342 $4,527

Special Education 171 $17,261

All Schools 2,620 $5,510

Combined Schools

NAIS Religious 95 $9,052

NAIS Non-Sectarian 346 $9,662

Other Religious 4,085 $4,527 x

Other Non-Sectarian 943 $4,527 x

Special Education 817 $9,662

All Schools 6,285 $5,766

Sources NCES 1995

Of the 19 sectors, 6 are for secondary schools only. Since the working paper notes that secondary

schools23 spend more than twice as much as elementary schools spend per pupil, and are the least likely,

by definition, to contain a COF, they are excluded from the calculation of the mean per-pupil expenditure

value.

23 Defined as having a highest grade less than or equal to 12th and a lowest grade of greater than or equal to 6th

.

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For elementary schools24, the $2,003 mean per-pupil expenditure cost was selected. This value represents

8,887 of the 17,093 (52%) elementary schools presented in the working paper. Though Catholic schools

represent approximately 45 percent of all elementary schools, their associated mean per-pupil expenditure

estimate is not used due to the potential bias discussed above. The remaining elementary school per-pupil

expenditure values are between 3 and 4 times larger than the chosen value; however these means

represent schools unlikely to be affected by the LRRP rule. For example, the mean per-pupil expenditure

values presented for NAIS schools (449 of the 561 remaining schools) are much higher since “a relatively

large proportion of NAIS schools are boarding schools and expenditures for dormitories are apparently

included in the total operating expenditures for these schools.” It is unlikely that a COF would be found in

a boarding school. The remaining 112 schools are special education elementary schools, which are more

costly because of their unique needs and are also less likely to contain a COF. Furthermore, as the

working paper notes, “preschool is probably less expensive than other grades,” and therefore, it is likely

that the average across all elementary schools ($2,125) would overstate expenditures.

For combined schools, the $4,527 mean per-pupil expenditure cost is used. 25 This value represents 5,028

of the 6,285 (80%) combined schools presented in the working paper. The other mean per-pupil values

are roughly double this value, pulling the mean for all combined schools up to $5,766. This higher value

is not used as it most likely overstates the expenditures given that boarding schools and special education

schools are again included in the calculation.

In order to obtain one private school per-pupil expenditure value, the previously discussed elementary

school and combined school data were weighted. The weights were based on the current proportions of

elementary schools and combined schools with either a pre-kindergarten or kindergarten program. In

order to calculate the weights, this analysis used the data set underlying the National Center for Education

Statistics (NCES) report entitled “Characteristics of Private Schools in the United States: Results From

the 2003-2004 Private School Universe Survey.” Note that it was assumed that per-student expenditures

at K-terminal schools were the same as in elementary schools. 26

In 2003-2004, there were a total of 18,289 private elementary schools and 4,338 private combined schools

with pre-K or kindergarten programs. Thus, a weight of 0.81 (18,289/22,627) was attached to the mean

per-pupil elementary school expenditure value and a weight of 0.19 (4,338/22,627) was attached to the

mean per-pupil combined school expenditure value. This calculation yields a final private school perpupil expenditure value of $2,426.

Because the study is based on 1991-1992 PSS data, it was assumed that expenditure values were in 1992

dollars. Taking into account inflation, $2,426 in 1992 dollars is equivalent to $3,377 in 2006 dollars (U.S.

Bureau of Labor Statistics 2006).

24 Defined as having a highest grade of less than or equal to 8th

.

25 A combined school is defined as having a highest grade less than or equal to 12th and a lowest grade less than or

equal to 5th.

26 A K-terminal school is defined as a school for which kindergarten is the highest grade. In the 2003-2004 PSS, Kterminals represented an estimated 22% of all private schools with either a kindergarten or pre-kindergarten

program.

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