## Economic Analysis of the Proposed Rule to add

HBCD to the List of TRI Reportable Chemicals

March 28, 2014

April 28 , 201



### Prepared by Abt Associates for: Analytical Support Branch Environmental Analysis Division Office of Information Analysis and Access
Office of Environmental Information US Environmental Protection Agency

### CONTENTS

Economic Analysis of the Proposed Addition of HBCD ▌ pg. ii ES. Executive Summary

................................ ................................ ................................ ................ iv

ES.1 Introduction

................................ ................................ ................................ ..................... iv

ES.2 Need for Rule

................................ ................................ ................................ .................. iv

ES.3 Addition of HBCD

................................ ................................ ................................ .......... iv

ES.4 Estimated Reporting Activity

................................ ................................ ........................... v
ES.5 Costs of the Proposed Rule

................................ ................................ .............................. v
ES.5.1 Industry Costs

................................ ................................ ................................ ..... v
ES.5.2 EPA Costs

................................ ................................ ................................ ........ vii

ES.5.3 Total Costs

................................ ................................ ................................ ....... vii

ES.6 Small Entity Analysis

................................ ................................ ................................ ... viii

ES.7 Benefits of the Proposed Rule

................................ ................................ .......................... x

1. Background and Overview of Analysis

................................ ................................ .............. 1

- 1

1.1 Overview of TRI

................................ ................................ ................................ .......... 1

- 1

1.1.1 Pollution Prevention Act

................................ ................................ ................. 1

- 3

1.1.2 Changes to the List of Chemicals

................................ ................................ .... 1

- 3

1.1.3 Alternate Threshold

................................ ................................ ......................... 1

- 3

1.1.4 Executive Order 12856

................................ ................................ ................... 1

- 4

1.1.5 Changes to the List of Industries

................................ ................................ ..... 1

- 4

1.1.6 Changes for Chemical s of Special Concern (e.g. Persistent, Bioaccumulative, and Toxic)

................................ ................................ ................................ ....... 1

- 4

1.1.7 Toxic Chemical Release Reporting Using North American Industry Classification System (NAICS) Rule

................................ .............................. 1

- 4

1.1.8 TRI Dioxin and Dioxin

- like Compounds Toxic Equivalency (TEQ)
Information Rule

................................ ................................ ............................. 1

- 5

1.2 Addition of HBCD to EPCRA Section 313 Reporting Requirements

......................... 1

- 5

1.3 Organization of This Report

................................ ................................ ......................... 1

- 5

2. Estimates of the Number of Reports and Affected Facilities

................................ ........... 2

- 1

2.1 Background

................................ ................................ ................................ .................. 2

- 1

2.1.1 Uses

................................ ................................ ................................ ................. 2

- 1

2.1.2 Production

................................ ................................ ................................ ....... 2

- 2

2.2 Method ology

................................ ................................ ................................ ................ 2

- 2

2.2.1 HBCD Manufacturers

................................ ................................ ..................... 2

- 3

2.2.2 EPS and XPS Foam Manufacturing

................................ ................................ 2

- 3

2.2.3 Textiles

................................ ................................ ................................ ............ 2

- 7

2.2.4 High Impact Polystyrene

................................ ................................ ............... 2

- 10

2.3 Summary

................................ ................................ ................................ .................... 2

- 12

### CONTENTS

Economic Analysis of the Proposed Addition of HBCD ▌ pg. iii 3. Cost Estima tes

................................ ................................ ................................ ...................... 3

- 1

3.1 Industry Burden and Cost Estimates

................................ ................................ ............ 3

- 1

3.1.1 Estimation of Burden

................................ ................................ ...................... 3

- 1

3.1.2 Estimation of Cost

................................ ................................ ........................... 3

- 3

3. 1.3 Total Industry Burden Estimates

................................ ................................ ..... 3

- 5

3.1.4 Total Industry Cost Estimates

................................ ................................ ......... 3

- 6

3.1.5 Annualized Cost Estimates

................................ ................................ ............. 3

- 7

3.2 EPA Cost Estimates

................................ ................................ ................................ ..... 3

- 8

3.3 Total Costs

................................ ................................ ................................ ................... 3

- 9

4. Small Entity Analysis

................................ ................................ ................................ ........... 4

- 1

4.1 Impact on Small Entities

................................ ................................ .............................. 4

- 1

4.2 Definitions of Small Entities

................................ ................................ ........................ 4

- 1

4.3 Methodology Overview

................................ ................................ ............................... 4

- 2

4. 3.1 Sectors Analyzed using Actual Facility Data (EPS Resin Manufacturing, XPS and EPS Foam Manufacturing, and Automotive Textile Manufacturing)

...... 4

- 4

4.3.2 Sectors Analyzed using Census Data (HBCD Manufacturing, Automotive Textile Manufacturing, and HIPS Manufacturing)

................................ ......... 4

- 7

4.4 Summary of Impacts to Small Parent Entities

................................ ........................... 4

- 13

5. Benefits

................................ ................................ ................................ ................................ .. 5

- 1

6. References

................................ ................................ ................................ ............................. 6

- 1

### EXECUTIVE SUMMARY

Economic Analysis of the Proposed Addition of HBCD ▌ pg. iv 

## ES. Executive Summary

ES.1 Introduction

Under section 313 of the Emergency Planning and Community Right

- to

- Know Act (EPCRA), and section 6607 of the Pollution Prevention Act (PPA), certain facilities are required to file annual reports to the United States Environmental Protection Agency (EPA) and to states or Indian Country offi cials on their releases, transfers, and other waste management practices for certain toxic chemicals if they are manufactured, processed, or otherwise used above certain threshold amounts. This information is included in a publicly available database known as the Toxic s Release Inventory (TRI).

Currently, there are 594 chemicals and 3 1 chemical categories on the list of chemicals subject to EPCRA section 313 requirements. EPCRA section 313(d) authorizes EPA to add chemicals to the list of reportable substan ces. Under the proposed rule, EPA adds hexabromocyclododecane (HBCD) to the list of individual chemicals subject to EPCRA section 313 reporting requirements.



### ES.2 Need for Rule

EPA believes that HBCD meets the EPCRA section 313(d)(2)(B) criteria for listing bec ause it presents potential human health concerns based on animal test results indicati ng developmental and reproductive
effects. EPA also believes that HBCD meets the EPCRA section 313(d)(2)( C ) criteria because it is highly toxic to aquatic organisms . Additionally, HBCD bioaccumulates and biomagnifies in the food chain ; is persistent ; and is transported long distances in the environment. As a result, HBCD meets the TRI criteria for a Persistent, Bioaccumulative, and Toxic (PBT) chemical and is design ated as a chemical of special

concern

. Further, EPA believes that facilities currently manufacture, process, or otherwise use these chemicals above TRI thresholds and therefore will file TRI reports based on the analysis presented in this
document.



### ES.3 Additio n of HBCD

HBCD is a brominated flame retardant found world

- wide in the environment and wildlife. Human exposure is evidenced from its presence in breast milk, adipose tissue and blood. It bioaccumulates and biomagnifies in the food chain. It persists and i s transported long distances in the environment, and is highly toxic to aquatic organisms. It also presents potential human health concerns based on animal test
results ind icating potential reproductive and developmental effects ( U.S. EPA, 2010 )

. The main use of HBCD is as a flame retardant in expanded polyst yrene foam (EPS) and extruded polystyrene foam (XPS). EPS and XPS are used primarily for thermal insulation boards in the building and construction industry ( Morose, 2006 ) . HBCD may also be used as a flame retardant in textiles including: upholstered furniture, upholstery seating in transportati on vehicles, draperies, wall coverings, mattress ticking, and interior textiles

, such as roller blinds ( Morose, 2006 ; European Chemicals Agency [ECHA], 2009 ) . In addition, HBCD is used as a flame retardant in high impact polystyrene (HIPS) for electrical and electronic appliances

, such as audio

- visual equipment as well as for s ome wire and cabl e
ap plications ( ECHA, 2009 )

.

### EXECUTIVE SUMMARY

Economic Analysis of the Proposed Addition of HBCD ▌ pg. v 

### ES.4 Estimated Reporting Activity

The number of additional TRI reports expected due to the proposed rule is summarized in Table ES

- 1
below

.

Table ES

- 1 : Total Estimated Forms and Facilities

Sector Number of Facilities Number of Forms Rs HBCD Manufacturing (NAICS 325) 3 3
EPS Resin Manufacturing (NAICS 325211) 4 4

XPS and EPS Foam Manufacturing (NAICS 326140) 66 66
Automotive Textile Manufacturing (Misc. NAICS Codes) 3 3
Motor Vehicle Seating and Interior Trim Manufacturing (NAICS 336360) 10 10

HIPS Manufacturing (NAICS 325211) 15 15

Total 101 101



### ES.5 Costs of the Proposed Rule

The proposed rule will result in associated c osts to both industry and EPA. Affected facilities will spend time reporting the required information to EPA on Form R or Form A. The Agency will spend time processing new forms.

ES.5.1 Industry Costs

For the prop osed rule, the burden and cost potentially incurred by industry are estimated using the Ratio

Based Burden Methodology (RBBM)

, which is a simplified formulation of the previously employed burden methodology ( U.S. EPA, 2011b )

. Estimating reporting burden using RBBM produces a more stable estimate that reflects overall “average” reporting conditions at affected facilities. According to RBBM, reporting activities can be divided into two groups:

 Form Activities, consisting of rul e familiarization, reporter compliance determination, calculations and form completion, and recordkeeping and sub mission; and

 Non

- Form Activities, consisting of supplier notification and non

- rep orter compliance
determination.

Form Activity burden is estim ated using the variable Nominal Form R U nit B urden to represent average burden incurred by filers to file a Form R. The Nominal Form R Unit Burden is set at 35.70516 hours. 1 Form A burden is closely linked to that of Form R, and is therefore quantified by the ratio A/R (set at 0.615), thus reflecting the burden of a Form A as 61.5 percent of the burden of a Form R. Form Activity

1 The burden of 35.70516 includes the addition of 0 .00516 hours of burden associate d with the Dioxin Reporting Requirements promulgated in May 10, 2007, and account ed for in the 2011 ICR (Docket# EPA

- HQ

- OEI

- 2010

- 0835 )

.

### EXECUTIVE SUMMARY

Economic Analysis of the Proposed Addition of HBCD ▌ pg. vi Burden can be calculated using the Nominal Form R U nit B urden, the A/R ratio, and the number of Form
R and Form A chemicals expect ed to be reported due to the proposed rule. RBBM combines Form Activity Burden with Non

- Form Activity Burden (consisting of supplier notification and non

- reporter compliance determination) in order to calculate Steady State Total Burden , which is the ongoi ng burden estimated to be incurred by filers due to the proposed rule (previously referred to as “Subsequent Year Burden”). To represent the elevated level of effort incurred by both filers reporting to TRI for the first

time and those already reporting to TRI but considering the requirements of the proposed rule for the first time, a First

- Time Filer Factor (FTF f ) is compute d at 2.1.

The costs potentially incurred by industry are estimated using the weighted average wage rate, WAWR, representing the averag e loaded cost for a mix of Managerial, Technical and Clerical labor pe r hour of TRI reporter burden. The WAWR is calculated using data from Bureau of Labor Statistics’ Employer Costs for Employee Compensation, updated quarterly. As of March 12, 2014, th e W AWR reflecting 2013 wage rate data is calculated at $49.25.

Table ES

- 2 presents the total industry cost of the proposed rule in the first year of the rule and in the steady state. Table ES

- 3 presents annualized industry costs annualized at discount rates of 3% and 7%.

Table ES

- 2 : Total First Year and Steady State Industry Cost under the Proposed Rule

Sector Number of Reporting Facilities Number

of Form Rs First Year

Total Cost ( 2013 Dollars ) Steady State

Total Cost ( 2013 Dollars )

HBCD Manufacturing (NAICS 325) 3 3 $11, 078 $5,275

EPS Resin Manufacturing (NAICS 325211) 4 4 $ 14,771 $7,034

XPS and EPS Foam Manufacturing (NAICS 326140) 66 66 $243,725 $116,060

Automotive Textile Manufacturing (Misc. NAICS Codes) 3 3 $11,078 $5,275

Motor Vehicle Seating and Interior Trim Manufacturing (NAICS 336360) 10 10 $36,928 $17,585

HIPS Manufacturing (NAICS 325211) 15 15 $55,392 $26,377

Total 101 101 $372,973 $177,606

### EXECUTIVE SUMMARY

Economic Analysis of the Proposed Addition of HBCD ▌ pg. vii Table ES

- 3 : Total Annualized Industry Cost under the Proposed Rule

Industry Costs Number of Reporting Facilities Number

of Form Rs Total

Annualized Cost (3%, 2013 Dollars) Total

Annualized Cost (7%, 201 3 Dollars)

HBCD Manufacturing (NAICS 325) 3 3 $5,936 $6,048

EPS Resin Manufacturing (NAICS 325211) 4 4 $7,915 $8,063

XPS and EPS Foam Manufacturing (NAICS 326140) 66 66 $130,590 $133,047

Automotive Textile Manufacturing (Misc. NAICS Codes) 3 3 $5,936 $6,048

Motor Vehicle Seating and Interior Trim Manufacturing (NAICS 336360) 10 10 $19,786 $20,159

HIPS Manufacturing (NAICS 325211) 15 15 $29,680 $30,238

Total 101 101 $199,843 $203,603

ES.5.2 EPA Costs

In general, EPA incurs burden and costs for five categories of activities related to the TRI program: data processing, outreach and training, information dissemination, policy and petitions, and compliance and enforcement. These activities involve both fixed ( e.g. , rent for the EPCRA reporting center) and variable costs (activities such as data processing that depend on the number of forms submitted). As a result of the proposed rule, the Agency is only expected to incur variable costs associated with data processing.

As of January 21, 2014, all non

- trade secret forms must be submitted electronically. EPA estimates that the processing cost for TRI

- MEweb subm issions is $3.33 per form. Therefore, the total form processing
burden for EPA associated with Form R and Form A chemical submissions under the proposed rule is estimated at $ 336

.

ES.5.3 Total Costs

The total cost of the proposed rule to in dustry and EPA is estim ated at approximately $200,000 under a
3% or 7% discount rate

. Table ES

- 4 summarizes the total annualized costs to industry and EPA as a result
of the proposed rule.

### EXECUTIVE SUMMARY

Economic Analysis of the Proposed Addition of HBCD ▌ pg. viii Table ES

- 4 : Summary of Total Costs of the Proposed Rule

Cost Category Total Cost (3% Discount Rate, 201 3 Dollars) Total Cost (7% Discount Rate, 201 3 Dollars)

Industry Costs $199,843 $203,603

EPA Processing Costs 1 $336 $336

Total Costs $200,179 $203,939

1 The annual and annualized EPA processing costs are the same as they are assumed constant across the ten year
time frame.



### ES.6 Small Entity Analysis

The Regulatory Flexibility Act (RFA) of 1980 (5 U.S.C. § 601 et. seq. ) requires Federal agencies to assess the effects of regulations on small entities, and in some instances, to examine alternatives to the regulations that may reduce adverse economic effects on significantly impacted small entities. The RFA requires agenci es 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.

This analysis uses annualized cost impact per centages to measure potential impacts on small entities. The cost impact percentage is defined as annualized compliance costs resulting from the proposed rule as a percentage of annual revenues or sales. For purposes of determining small entity impacts, co mparing annualized 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 smal l fraction of a typical firm's revenue, the impacts of the regulation are likely to be minimal.

Small entity impacts for the 101 facilities estimated to be affected by the proposed rule are estimated either using actual facility and parent entity data or using U.S. Census data.

For the sectors where the identity of each facility is known (EPS resin manufacturing, EPS foam manufacturing, XPS foam manufacturing, and automotive textile manufacturing), cost impact percentages are calculated using the actual co mpliance costs per facility, the number of facilities per parent company for small entities, and the annual revenues of the small entities. Company revenue data, facility

- parent relationships, and the data necessary to determine if the parent entity is sma ll were obtained from

Hoover ’ s, Inc

. ’ s business information database, which provides data including annual revenue, number of employees, line of business, parent company identity, and corporate linkages ( Hoover's Inc, 2014 )

. Small entity impacts in sectors where the identify of each facility is not known (HBCD manufacturing, motor vehicle seating and trim manufac turing, and HIPS manufacturing) were estimated using revenue, employment, and facility

- parent relationship data from the U.S. Census Bureau‘s Statistics of U.S. Businesses (SUSB) ( U.S. Census Bureau, 2007 )

. The SUSB prov ides annual data for U.S. business establishments by geography, industry, and enterprise size, including counts of establishments, firms, employees, and payroll. Data on total revenues are also provided by SUSB every five years. The data

### EXECUTIVE SUMMARY

Economic Analysis of the Proposed Addition of HBCD ▌ pg. ix available from the SUSB can therefore be used to estimate the number of small parent entities affected under the proposed rule, estimate annual revenues, and calculate cost impact percentages.

Although the specific methodology used to estimate small entity impacts differs b ased on the data available for each sector, the general methodology employed consists of the following steps:

Step 1: Identify the universe of facilities expected to incur compliance costs due to the proposed rule.

Step 2: Characterize the relationships be tween these facilities and their global ultimate parent entities.

Step 3: Estimate annual revenues of parent entities.

Step 4: Identify small parent entities based on SBA or RFA definitions.

Step 5: Develop annualized compliance cost estimates for small pa rent entities using the per

- facility reporting cost and the number of facilities per parent entity that will report to TRI.

Step 6: Calculate the entity

- level impact percentages, defined as annualized compliance costs as a percentage of annual revenues, to measure regulatory burden.

Step 7: Estimate the number and percentage of small parent entities with entity

- level impact percentages in each of three categories: (1) less than one percent of annual revenues; (2) between one and three percent of annual reve nues; and (3) greater than or equal to three percent of annual

revenues.

The 101 facilities expected to report under the proposed rule were linked to 55 parent entities, 42 of which were categorized as small parent entities. All of the 42 small parent enti ties are estimated to incur annualized cost impacts of less than 1%. Therefore, the proposed rule is not expected to significantly impact a substantial number of small entities. Table ES

- 5 summarizes the results of the small entity analysis.

### EXECUTIVE SUMMARY

Economic Analysis of the Proposed Addition of HBCD ▌ pg. x Table ES

- 5 : Summary of Small Entity Analysis

Sector Small Parent Entities Incurring Impacts of <1% Small Parent

Entities Incurring Impacts of 1% to 3% Small Parent

Entities Incurring Impacts of >3%

HBCD Manufacturing (NAICS 325) 2 (100%) 0 0

EPS Resin Manufacturing (NAICS 325211) 0 0 0

XPS and EPS Foam Manufacturing (NAICS 326140) 26 (100%) 0 0

Automotive Textile Manufacturing (Misc. NAICS Codes) 1 (100%) 0 0

Motor Vehicle Seating and Trim Manufacturing (NAICS 336360) 5 (100%) 0 0

HIPS Manufacturing (NAICS 325211) 8 (100%) 0 0

Total 42 (100%) 0 0



### ES.7 Benefits of the Proposed Rule

The benefits of the proposed rule include improved understanding, awareness, and decision making related to the provision and distribution of information on releases and waste management of HBCD . The provision of information can lead to follow

- on activities that create additional cos ts and benefits. In particular, this information can lead to voluntary initiatives by industry to review production processes, set goals for reductions in emissions, and institute “good neighbor” policies.

EPA has not attempted to monetize the benefits of the proposed rule due to the lack of quantitative information characterizing the range of users and non

- users of TRI data and the substantial analytical challenges associated with conducting an analysis that accurately predicts behavioral responses to the provision of information. In addition, the potentially large numbers of beneficiaries who are not TRI data users, or who are otherwise unaware of the data ( e.g. , general public), further limits EPA’s ability to quantify potential benefits. However, the exp erience since the first forms were submitted to TRI in 1987 suggests that reporting under EPCRA section 313 has produced real gains in understanding about communities’ exposure to toxic chemicals. In its report entitled The Toxics Release Inventory in Acti on: Media, Government, Business, Community and Academic Uses of TRI , EPA has documented numerous examples of how multiple stakeholders have used TRI data ( U.S. EPA, 2013b )

. Moreover, a cursory search on GoogleScholarTM reveals thousands of academi c articles referencing the Toxics Release Inventory. Listing HBCD , and the subsequent use of the reported information, should provide similar gains in understanding of this particular chemical. EPA believes that HBCD meets the statutory toxicity
criteria o f section 313, and is at least as toxic as some of the chemicals for which Congress initially believed there were net benefits due to reporting (i.e., the initial list of section 313 chemicals).

### BACKGROUND AND OVERVIEW OF ANALYSIS

Economic Analysis of Proposed Addition of HBCD ▌ pg. 1

- 1 

## 1. Background and Overview of Analysis

The Emergency Planning and Community Right

- to

- Know Act (EPCRA), also known as Title III of the Superfund Amendments and Reauthorization Act of 1986 (SARA), created a broad range of emergency response planning and reporting requirements for manufac turers, processors, and users of toxic chemicals in the United States. Under section 313 of EPCRA, certain facilities are required to submit annual reports to the United States Environmental Protection Agency (EPA) and to States and Indian Country official s on their release(s), transfer(s), and waste management activities for certain toxic chemicals if they are manufactured, processed, or otherwise used above thresholds amounts. In addition, the Pollution Prevention Act (PPA) of 1990 requires these same fac ilities to report prevention, recycling, and other waste management information for these same chemicals. EPA maintains the data collected under EPCRA section 313 and the PPA in a database known as the Toxics Release Inventory (TRI). 2

EPCRA section 313(f)( 1) contains default reporting thresholds for facilities. These reporting thresholds are 25,000 pounds for toxic chemicals that are manufactured (including imported) or processed, and 10,000 pounds for toxic chemicals that are otherwise used. For chemicals that are considered to be persistent, bioaccumulative, and toxic (PBT) , reporting thresholds are set at 10 or 100 lbs, with the exception of dioxin, which is set at 0.1 grams. Facilities that meet these reporting thresholds, as well as other reporting crit eria, are required to submit annual reports. Under this rule, reporting would be required
for hexabromocyclododecane ( HBCD )

, which EPA consider s to present potential human health concerns
based on animal test results indicati ng developmental and reproductive effects. Additionally, HBCD is highly toxic to aquatic organisms ; bioaccumulates and biomagnifies in the food chain ; is persistent ; and is transported long distances in the environment. As a result, HBCD meets the TRI criteria for a Persi stent, Bioaccumulative, and Toxic (PBT) chemical.

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



### 1.1 Overview of TRI

In 1986, Congress passed the Emergency Planning and Commun ity Right

- to

- Know Act (EPCRA). The law was passed in response to the ac cidental release of methyl isocyanate gas in Bhopal, India, in December 1984, and to a number of chemical accidents in the United States, including on e in Institute, West Virginia. These accidental releases highlighted the lack of information readily avail able to the public about toxic chemicals being manufactured, processed, used, and transp orted within their
communities. EPCRA is based on the premise that the public has the right to know about the use of chemicals, as well as their ro utine and accidental releases. The broad purposes are to encourage planning for response to accidental chemical releases as well as daily management of routine releases, and to

2 The term EPCRA section 313 properly refers to only the statutory requirements, while the term TRI properly refers
to the database where the information collected under section 313 and under section 6607 of the PPA is stored. However, the terms have often been used interchangeably by the public to refer to the statute, the regulatory requirements, the reporting form, the database, and EPA's program to manage the data. In deference to common usage, the terms EPCRA section 313 and TRI are sometimes used inter changeably in this report where doing so will make the report simpler and easier to read.

### BACKGROUND AND OVERVIEW OF ANALYSIS

Economic Analysis of Proposed Addition of HBCD ▌ pg. 1

- 2 provide the public and government agencies with information about the presence, release, and

managem ent of toxic chemicals.

EPCRA contains four main provisions:

 Planning for chemical emergencies (sections 301

- 303),

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

 Reporting of hazardous chemical inventories (sections 311

- 312), and

 Toxic chemical release reporting (section 313).

Because this rule falls under section 313 of EPCRA, the remainder of this overview only addresses the reporting provisions of section 313.

The first regulations implementing EPCRA section 313 were promulgated on February 16, 1988 (53 FR 4500), and are codified at 40 CFR part 372. Under these original regulations, owners or operators of certain facilities must complete and submit one or more Toxic Chemical Release Inventory Reporting Form R reports. The informa tion to be submitted on a Form R report includes, but is not limited to, information on releases to air, water, and land, as well as on

- site waste treatment and transfers of the

c hemical to off

- site locations.

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

1. It is in an Industrial Classification code covered by the regulations;

2. It has ten or more full

- time employees (or the hourly equivalent of 20,000 hours); and

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

A completed Form R must be submitted for each listed toxic chemical manufactured, processed, or otherwise used above threshold levels at each regulated facility as described in 40 CFR part 372. For most chemicals, threshold levels are set at 25,000 lbs for manufacturing and processing and 10,000 lbs for otherwise use (40 CFR § 372.25). The EPCRA section 313 list currently contains over 600 toxic
chemicals and chemica l compound categories (hereinafter, “TRI chemicals”). Reports for each Calendar Year are due by July 1 of the following year.

TRI is unique among environmental databases because of the multimedia data it collects, and because it was designed for public acc ess. The primary purpose of TRI data is to inform the public of releases and other waste management activities of toxic chemicals in their communities, and enable citizens to make informed decisions regarding the consequences of such activities to human he alth and the environment. TRI data are also used by the federal, state and local governments for prioritization purposes and to assess pollution prevention activities. Researchers, public interest groups, as well as others use TRI data for a variety of pur poses. In general, TRI data have proven to be a powerful tool in environmental decision

making.

### BACKGROUND AND OVERVIEW OF ANALYSIS

Economic Analysis of Proposed Addition of HBCD ▌ pg. 1

- 3 1.1.1 Pollution Prevention Act

In 1990, Congress passed the Pollution Prevention Act (PPA), which adopted as national policy an environmental hierarchy that establish es pollution prevention as the first choice among waste management options (42 U.S.C. §§ 13101

- 13109). For waste that cannot be prevented at the source, recycling is considered the next best option, and treatment or disposal should be considered only when source reduction and recycling options cannot be implemented. Section 6607 of the PPA requires facilities to also provide information on their pollution prevention, recycling, and other waste management activities. This information complements the informat ion reported under EPCRA section 313 by providing information about the waste management activities related to the reported chemicals. The data elements required by the Pollution Prevention Act are included as Section 8 of Form R.

1.1.2 Changes to the List of Chemicals

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

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

 In humans, cancer or teratogenic effects, serious or irreversible reproductive dy sfunctions, neurological disorders, heritable genetic mutations, or other chronic health effects; or

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

EPA has added chemicals to the list through its authority under section 313(d). Most notably, EPA added 286 chemicals and chemical categories to the EPCRA section 313 list of toxic chemicals on November 30, 1994 (59 FR 61432).

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

1.1.3 Alternate Threshold

On November 30, 1994, EPA finalized the “TRI Alternate Threshold for Facilities with Low Annual Reportable Amounts” (59 FR 61488). This rule was intended to reduce the compliance burden associ ated with EPCRA section 313. It established a streamlined reporting option for facilities that manufacture, process or otherwise use a TRI chemical in annual quantities of one million pounds or less and where the annual reportable amount of the chemical do es not exceed 500 pounds. 3 Under such circumstances the facility has the option of filing a two

- page certification statement known as a “Form A” instead of the longer Form R (40 CFR 372.27). The Form A is a certification that once completed and signed cert ifies

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

### BACKGROUND AND OVERVIEW OF ANALYSIS

Economic Analysis of Proposed Addition of HBCD ▌ pg. 1

- 4 that the facility is not required to file a Form R for the chemical because the facility did not exceed 500 pounds for the total annual reportable amount for that chemical, and that their amounts manufactured or processed or otherwise used did not ex ceed one million pounds. EPA has excluded certain chemicals designated as chemicals of special concern (see below) from Form A eligibility.

1.1.4 Executive Order 12856
On August 3, 1993, Executive Order 12856, “Federal Compliance with Right

- to

- Know Laws and
Poll ution Prevention Requirements” was signed by the President (58 FR 41981). The Executive Order requires federal facilities to comply with EPCRA requirements beginning with the 1994

- reporting year. The Executive Order also asked all federal agencies to set a voluntary goal of 50% reduction from baseline quantities of their releases and transfers by 1999.

1.1.5 Changes to the List of Industries

On May 1, 1997, EPA added facilities in seven industry groups to the list of facilities subject to the reporting requiremen ts of section 313 (62 FR 23833). The first reports from these facilities were required to be submitted by July 1, 1999 for the calendar year 1998. Prior to this action, reporting was limited to facilities in the manufacturing sector (SIC codes 20

- 39) and f ederal facilities. This action added facilities in the following sectors:

 Metal mining,

 Coal mining,

 Electric utilities,

 Commercial hazardous waste treatment, storage, and disposal facilities

,

 Chemicals and allied products

- wholesale,

 Petroleum bulk termi nals and plants

- wholesale, and

 Solvent recovery services.

1.1.6 Changes for Chemicals of Special Concern (e.g. Persistent, Bioaccumulative, and Toxic )

On October 29, 1999, EPA published a final rule that lowered the reporting thresholds to 10 or 100 pounds for certain TRI chemicals (persistent, bioaccumulative and toxic chemicals, or PBT chemicals) that are of special concern (64 FR 58666). In the same rule, EPA also added to the section 313 list of toxic chemicals certain PBT chemicals that were not already lis ted, including a dioxin category with a reporting threshold of 0.1 gram. Additionally, this rulemaking included other changes to PBT chemical reporting, such as disallowing the use of the de minimis exemption, range reporting, and Form A for PBT
chemicals (40 CFR § 372.28(b)). On January 17, 2001, EPA published a final rule that designated lead and its compounds as PBTs, lowered the reporting threshold for these chemicals to 100 pounds, and applied the same limitations as are applied to other PBT chemicals (40 CFR § 372.28).

1.1.7 Toxic Chemical Release Reporting Using North American Industry Classification System (NAICS) Rule

On June 6, 2006, EPA published a final rule requiring facilities reporting to TRI to use North American Industry Classification System (NAI CS) codes in place of the Standard Industry Classification (SIC)

### BACKGROUND AND OVERVIEW OF ANALYSIS

Economic Analysis of Proposed Addition of HBCD ▌ pg. 1

- 5 codes previously used on TRI reporting forms. This rule required facilities that report to TRI to use 2002 NAICS codes on reporting Form R and the Form A Certification Statement. The 2007 NAI CS Revision Final Rule published on June 9, 2008, required facilities to use 2007 NAICS codes on TRI reporting
forms. NAICS reporting requirements were revised again on July 18, 2013. Under the 2012 NAICS Revision Final Rule, facilities are required to use 2012 NAICS codes when submitting forms for reporting years 2013 and beyond.

1.1.8 TRI Dioxin and Dioxin

- like Compounds Toxic Equivalency (TEQ) Information Rule

On May 10, 2007, the Toxics Release Inventory Program issued a final rule expanding reporting require ments for the dioxin and dioxin

- like compounds category. There are seventeen distinct members of this chemical category that are included on the EPCRA section 313 list of toxic chemicals. The final rule requires that, in addition to the total grams release d for the entire category, facilities must report the quantity for each individual member on a new Form R Schedule 1. EPA will then use the individual mass quantity data to calculate TEQ values that will be made available to the public along with the mass data. The final rule also removes the requirement to report the single distributio n of compounds in the category.



### 1.2 Addition of HBCD to EPCRA Section 313 Reporting Requirements

HBCD is a brominated flame retardant found world

- wide in the environment and wildlife. Human exposure is evidenced from its presence in breast milk, adipose tissue and blood. It bioaccumulates and biomagnifies in the food chain. It persists and is transpor ted long distances in the environment, and is highly toxic to aquatic organisms. It also presents potential human health concerns based on animal test results indicating potential developmental and reproductive effects ( U.S. EPA, 2010 )

. The main use of HBCD is as a flame retardant in expanded polystyrene foam (EPS) and extruded polystyrene foam (XPS). EPS and XPS are used primarily for thermal insulation boards in the building and construction industry ( Morose, 2006 )

. HBCD may also be used as a flame retardant in textiles including: upholstered furniture, upholstery seating in transportation vehicle s, draperies, wall coverings, mattress ticking, and interior textiles

, such as roller blinds ( Morose, 2006 ; ECHA, 2009 )

. In addition,
HBCD is used as a flame retardant in high impact polystyrene (HIPS) for electrical and electronic appliances such as audio

- visual equipment

, as well as for some wire and cable applications ( Morose,
2006 ; ECHA, 2009 )

.



### 1.3 Organization of This Report

This report examines the potential impact to industry and the Agency of adding HBCD to the list of
EPCRA s ection 313 report able chemicals

. The remainder of this report is org anized as follows:

 Chapter 2 : Estimates of the Number of Reports and Affected Facilities summarizes the expected number of reports and facilities affected by the proposed rule.

 Chapter 3 : Cost Estimates presents the methodology used to estimate costs, as well as the results of the analysis in terms of total incremental cost to industry and total incremental cost to
EPA.

 Chapter 4 : Small Entity Analysis examines the impacts of the proposed rule, specifically those impacts on “small” entities as required by the Regulatory Flexibility Act of 1980.

### BACKGROUND AND OVERVIEW OF ANALYSIS

Economic Analysis of Proposed Addition of HBCD ▌ pg. 1

- 6  Chapter 5 : Benefits evaluates the benefits of the proposed rule.

 Chapter 6 : References provides references cited in this analysis

.

### ESTIMATES OF THE NUMBER OF REPORTS AND AFFECTED FACILITIES

Economic Analysis of Proposed Addition of HBCD ▌ pg. 2

- 1 

## 2. Estimates of the Number of Reports and Affected Facilities

This chapter presents the estimate of the number of additional forms and affected facilities that would
result from the proposed addition of Hexabromocyclododecane (HBCD) to the TRI list of reportable
chemicals as a chemical of special concern due to its persistent and bioaccumulation , with a chemical activity th reshold of 100 lb.

Background information on HBCD is provided in Section 2.1 of this chapter. T he methods and associated assumptions used to estimate reporting for HBCD are presented in Section 2.2

. Section 2.3 provides a summary of expected rep orting from the potentially affected universe of facilities.



### 2.1 Background

HBCD is a category of brominated flame retardants, consisting of 16 possible isomers. It has a molecular formula of C 12 H 18 Br 6 and its structure consists of a ring of 12 carbon atoms to which 18 hydrogen and six bromine atoms are bound. HBCD may be designa ted as a non

- specific mixture of all isomers (Hexabromocyclododecane; CASRN: 25637

- 99

- 4) or as a mixture of three main diastereomers (1,2,5,6,9,10

- hexabromocyc lododecane; CASRN: 3194

- 55

- 6). Commercial preparations of HBCD may contain some impurities, such as tetrabromocyclododecene or other isomeric HBCDs ( U.S. EPA, 2010 )

. EPA intends to list HBCD as a PBT category defined as:

Hexabromocyclododecane (This category includes only those chemicals covered by the CAS numbers listed below) 3194

- 55

- 6 1,2,5,6,9,10

- Hexabromocyclododecane 25637

- 99

- 4 Hexabromocyclododecane

Regulation of HBCD has been increasing internationally. In the European Union, HBCD was identified as a Substance of Very High Concern (SVHC) under the Registration, Evaluation, Authorization and Restriction of Chemicals (REAC H) regulation. Under Title VII of REACH, HBCD has been added to Annex XIV and has a sunset date of July 21, 2015. After this date, only authorized applications for
HBCD will continue to be allowed in the EU ( U.S. EPA, 2011a )

. HBCD was also added to Annex A of
the Stockh olm Convention on Persistent O rganic Pollutants in May, 2013. This action bans the production and use of HBCD with a specific exception for the use of HBCD in EPS and XPS in buildings. There are 179 Parties to the Stockholm convention, including the Europe an Union and 178
other countries 4 ( United Nations Environment Programme [UNEP], 2013a ; UNEP, 2013b )

.

2.1.1 Uses

The main use of HBCD is as a flame retardant in expanded polystyrene foam (EPS) and extruded polystyrene foam (XPS). EPS and XPS are used primarily for thermal insulation boards in the building and construction industry ( Morose, 2006 )

. HBCD is used as a flame retardant in these products because it is highly effective at low concentrations. EPS boards contain approximately 0.5

- 0.7% HBCD by weight, while XPS insulation contains approximately 0.8

- 2.5% HBCD by weight ( UNEP, 2011 )

. There is little published information about the distribution of HBCD in the United States ; however, data for the European Union (EU) market shows that about 96% of HBCD is used in EPS and XPS ( ECHA, 2009 )

.

4 Note that the United States is not a Party to the Stockholm Convention.

### ESTIMATES OF THE NUMBER OF REPORTS AND AFFECTED FACILITIES

Economic Analysis of Proposed Addition of HBCD ▌ pg. 2

- 2 The EU market for HBCD is considered to be similar to th e U.S. market, although differences may exist. For the purpose of this analysis, the two markets are ass umed to be similar.

HBCD may also be used as a flame retardant in textiles including: upholstered furniture, upholstery seating in transportation vehicl es, draperies, wall coverings, mattress ticking, and interior textiles such as
roller blinds ( Morose, 2006 ; ECHA, 2009 )

. In these applications, HBCD i s incorporated into a coating appl ied to the back of the textile. The maximum concentration of HBCD for use in fabrics and textiles and in rubber and plastic products ranges from 5

- 25% ( UNEP, 2011 ) . In the EU, about 2% of HBCD is used in the textile industry ( ECHA, 2009 )

. In addition, HBCD is used as a flame retardant in high impact polystyrene (HIPS) for electrical and electronic appliances

, such as audio

- visual equipment as well as for some wire and cable applications ( Morose, 2006 ; ECHA, 2009 )

. An estimated 2% of HBCD used in Europe is used in HIPS ( ECHA,
2009 )

.

2.1.2 Production

The annual U.S. import/production volume of CASRN 25637

- 99

- 4 was between 10,000 and 500,000 pounds as reported under t he Inventory Update Reporting rule (now the Chemical Data Reporting rule) in
2002 ( U.S. EPA, 2002 )

. No import or product ion was reported in 2006, and total production volume in
2012 was CBI . The annual import/production volume of CASRN 3194

- 55

- 6 was 10

- 50 mil lion pounds in
2002 and 2006. The 2012 total production vol ume was CBI . This analysis assumes a total import/produc tion volume of 10

- 50 million pounds for HBCD, as reported in the 2006 IUR ( U.S. EPA,
2006 )

.



### 2.2 Methodology

As a first step in estimating the potential for HBCD reporting, major sectors manufacturing and processing HBCD are identified. Sectors manufacturing and pro cessing HBCD are presented in Table
2

- 1

.

### ESTIMATES OF THE NUMBER OF REPORTS AND AFFECTED FACILITIES

Economic Analysis of Proposed Addition of HBCD ▌ pg. 2

- 3 Table 2

- 1 : Major Sectors Manufacturing or Processing HBCD

Use NAICS NAICS Description

Manufacturers 325 Chemical Manufacturing

325211 Plastics Material and Resin Manufacturing

XPS and EPS
Manufacturers 326140 Polystyrene Foam Product Manufacturing

Consumer
Textiles 313320 Nonwoven Fabric Mills

313311 Broadwoven Fabric Finishing Mills

313312 Textile and Fabric Finishing ( except Broadwoven Fabric) Mills

313320 Fabric Coating Mills

314110 Carpet and Rug Mills

336399 All other Motor Vehicle Parts Manufacturing

336360 Motor Vehicle Seating and Interior Trim Manufacturing

HIPS 325211 Plastics Material and Resin Manufacturing

334, 335 Computer and Electronic Product Manufacturing; Electrical

Equipment and Component Manufacturing

2.2.1 HBCD Manufacturers

Information on manufacturers or importers of HBCD is available from TSCA Chemical Data Reporting (CDR; formerly Inventory Update Rule) and other sources. Both HBCD CASRNs are listed in CDR. The 2012 CDR lists three facilities reporting CASRN 25637

- 99

- 4 and two facilities reporting CASRN 3194

- 55

- 6 ( U .S. EPA, 2013a )

. Other sources, including the Directory of World Chemical Producers (DWCP) and SRI Consulting’s 2010 Directory of Chemical Producers (DCP)

, did not identify any other manufacturers or importers. Therefore

, it is assumed that these five a re the only facilities manufacturing or importing HBCD in the U.S. Because the reporting threshold for CDR is 25,000 lb., which is significantly higher than the proposed TRI threshold of 100 lb., it is assumed that these five facilities will
all exceed the TRI chemical activity threshold. However, two of these facilities are listed in CDR as having less than 10 employees, and are assumed to be below the employment threshold ( U.S. EPA,
2013a )

. As a result, a total of three manufacturers would be required to report to TRI under the proposed
rule.

2.2.2 E PS and XPS Foam Manufacturing

The main application of HBCD is as a flame retardant in expanded polystyrene foam (EPS) and extruded polystyrene foam (XPS). EPS is primarily used in insulation boards used by the construction industry. XPS is primarily used a s insulation for bridges, floors, basement walls and foundations, and roofs ( IOM Consulting, 2008 )

.

EPS foam is produced in two steps. First, resin manufacturers produce polystyrene resin beads by a suspension polymerization of styrene in water. Additives, including HBCD, are introduced in this stage. Second, the EPS beads are sold to molders to create EPS foam thr ough an expansion and molding process ( IOM Consulting, 2008 )

.

### ESTIMATES OF THE NUMBER OF REPORTS AND AFFECTED FACILITIES

Economic Analysis of Proposed Addition of HBCD ▌ pg. 2

- 4 XPS foam is produced by XPS manufactures in an ex trusion process. Polystyrene and additives, including HBCD, are fed into an extruder where the polymer is melted. The melted gel is fed into a die, where the blowing agent volatilizes and causes the plastic to become a foam ( IOM Consulting, 2008 )

. Reporting
from EPS and XPS foam manufacturers is estimated as follows:

 First, the number of EPS resin bead manufacturers potentially reporting to TRI is estimate d using
trade association data.

 Second, two methods are used to estimate the number of EPS and XPS foam manufacturers. In Method 1, trade association data are used to identify specific EPS and XPS manufacturers. Whi le the trade associations include the majority of EPS and XPS manufacturers, some manufacturers may not be included. Therefore, a second method (Method 2) is used to model the number of reporters using more general Economic Census data. Taken together, the se methods act as a check against each other and likely bound the estimates of reporting from EPS and XPS foam
manufacturers.

EPS Resin Bead Manufacturing EPS polystyrene resins are produced by a suspension polymerization of styrene in water. Additives,
in cluding HBCD, are introduced during this stage. Through this process, HBCD is incorporated as a component into the polymer matrix

. The resulting maximum concentration of HBCD in EPS resin beads
is approximately 0.7% ( IOM Consulting, 2008 )

. A limited number of chemical companies in the U.S. manufacture EPS resin beads. The EPS Industry Alliance (EPS

- IA), formed in 2012 by the consolidation of two industry trade groups, represents the entire EPS industry ( EPS

- IA, 2012a )

. The EPS

- IA website lists facility names and addresses for all member EPS manufacturers. The list includes manufacturing facilities, distribution cent ers, and company headquarters. There are three companies that own four facilities manufacturing EPS resin i n the U.S. Employment data for these facilities were identifi ed using the Hoover’s database ( Hoover's Inc, 2014 )

. One facility could not be l ocated in the Hoover’s database; therefore, employment data was identified from Manta, a free online database with data for small businesses. All four facili ties have 10 or more employees.

According to the European Chemicals Agency (ECHA), an estimated 46% of HBCD is used in the
manufacture of EPS ( ECHA, 2009 )

. Assuming an import/production value of 50 million lb., which is the maximum amount listed in the 2006 IUR, the amount of HBCD used in EPS manufacturing in the United
States is estimated to be 23 million lb. Assumi ng HBCD production is proportional to employment, if the total quantity of HBCD processed is distributed across the four resin bead manufacturing facilities by facility

- specific employee counts, then all four facilities are estimated to exceed the TRI repo rting threshold and would be required to report under the proposed rule.

EPS and XPS Foam Manufactur ing Method 1: Estimate EPS and XPS Foam Manufacturing Facilities Directly
Method 1 relies on information from EPS and XPS trade associations to identify spe cific facilities tha t manufacture EPS and XPS foam.

Ide ntifying EPS Foam Manufacturers
EPS foam manufacturers process EPS resin beads that contain HBCD at a maximum concentration of 0.7% w/w. Because HBCD is a PBT chemical, the de minimis exemption does no t apply and facilities

### ESTIMATES OF THE NUMBER OF REPORTS AND AFFECTED FACILITIES

Economic Analysis of Proposed Addition of HBCD ▌ pg. 2

- 5 will need to evaluate whether they exceed the reporting threshold regardless of the HBCD concentration
in EPS foam.

As mentioned above, the EPS Industry Alliance (EPS

- IA) website lists facility names and addresses for
all member EPS manufacturers. The list includes manufacturing facilities, distribution centers, and company headquarters ( EPS

- IA, 2012b )

. However, only manufacturing facilities are expected to report to TRI. Therefore, facility addresses were checked against EPA’s Facility Registry Sy stem (FRS) records and individual company websites to identify which facilities are currently manufacturing EPS foam.

Because most EPS packaging material usually does not contain HBCD ( IOM Consulting, 2008 )

, facilities manufacturing EPS packaging were not included in this analysis.

Employment data for these facilities were identified using the Hoover’s database. For the several facilities that could not be located in the Hoover’s database, employment data were identified from Manta. When employment data was given as a range, the number of employees was assumed to be the midpoint of the range. A total of 56 facilities with 10 or more employees were identified, all of which may process
HBCD.

As stated in above , the amount of HBCD used in EPS manufacturing in the United States is estimated to be 23 million lb. Assuming the quantity of HBCD used is proportional to employment, if HBCD use is
distributed across the 56 facilities by facility

- specific employee counts, then all 56 facilities are estimated to exceed the reporting threshold of 100 lb. and would be required to report to TRI under the proposed
rule.

Iden tifying XPS Foam Manufacturers
According to the Extruded Polystyrene Foam Association (XPSA), three of their members collectively manufacture more than 95% of all XPS foam products used in North America. These three companies are: Dow, Owens Corning, and P activ ( XPSA, 2014 ) . Ten XPS foam manufacturing facilities owned by these three companies were identified on company websites and through additional internet research. Employment data for these facilities were identified using the Hoover’s database. For the s everal facilities that could not be located in the Hoover’s database, employment data were identified from Manta. Two facilities did not have employment data in either database. In this case, employment was assumed to be the average facility employment for their respective parent companies. All ten facilities are estimated to have more than ten employees.

An estimated 51% of HBCD is used in the manufacture of XPS ( ECHA, 2009 )

. Assuming an import/production value of 50 million lb., which is the maximum amount listed in the 2006 IUR, the
amount of HBCD u sed in XPS manufacturing in the United States is 25.5 million lb. Assuming the quantity of HBCD used is proportional to employment, if HBCD use is distributed across the ten facilities by facility

- specific employee counts, then all facilities are estimated to exceed the TRI reporting threshold of 100 lb. and would be required to report to TRI under the proposed rule.

Method 2: Model EPS and XPS Foam Manufacturing Facilities on Economic Census Data

Method 2 uses Economic Census data for Product Code 3261403: Building and Construction Polystyrene Foam Products to model the amount of HBCD used per facility and then compares this amount to the TRI reporting threshold.

NAICS code 326140, Polystyrene Foam Manufacturing, is comprised of establishments primarily

eng aged in manufacturing polystyrene foam products including; transportation foam products, packaging,

### ESTIMATES OF THE NUMBER OF REPORTS AND AFFECTED FACILITIES

Economic Analysis of Proposed Addition of HBCD ▌ pg. 2

- 6 furniture polystyrene foam products, and consumer foam products like coolers and dinnerware. Because EPS and XPS are used almost exclusively in the construc tion industry, processing of HBCD is assumed to be concentrated in Product Code 3261403: Building and Construction Polystyrene Foam Products. This product code primarily includes HBCD

- treated EPS and XPS foam, and therefore it is assumed that all products in this code contain HBCD. Limiting the analysis to this specific product code excludes polystyrene manufacturers not using HBCD. In 2008, Product Code 3261403 accounted for 17% of the Product Shipments v alue of the overall NAICS code.

The U.S. Census Bure au’s Economic Census, Manufacturing Industry Series provides industry statistics including establishment count, employee count, and value of shipments for NAICS 326140: Polystyrene Foam Manufacturing. The 2002 Economic Census also provides total establishm ent and employee counts
for Prod uct Code 3261403. This informati on is not available in the 2007 Economic Census. As a result,
this method uses the 2002 data.

Census provides the distribution of establishments (assumed to be the same as facilities) and the total number of employees by employment size class for NAICS 326140. For four size classes, Census provides the total number of employees in the class as a range instead of a specific number. In this analysis, the total number of employees for these four s ize classes is assumed to be the midpoint of the range. As a result, the sum of estimated employees based on size class does not match the total number o f employees for the NAICS code. Facility and employee distribution is not available by size class for

P roduct Code 3261403. Therefore, this distribution was approximated from the sector

- wide distribution at
the NAICS code level.

The amount of HBCD processed per facility was estimated by assuming HBCD use is proportional to employment. As noted above, an est imated 96% of all HBCD is used in the manufacture of EPS and XPS ( ECHA, 2009 )

, and the maximum U.S. consumption of HBCD is estimated to be 50 million pounds ( U.S. EPA, 2006 )

. Therefore, the amount of HBCD used in the Building and Construction Polystyrene Foam Manufacturing sector is estimated to be 48 million lb. This quantity was distributed by the percent of total employees in each size class, and then divided by the number of facilities in each employment class to estimate the pounds of HBCD per facility. All facilities exceeded the 100 lb. threshold; therefore, it is
estimated that all facilities with more than 10 employees would be required to report to TRI under the proposed rule. Table 2

- 2 shows the estimated number of facilities reporting by employment size category.

### ESTIMATES OF THE NUMBER OF REPORTS AND AFFECTED FACILITIES

Economic Analysis of Proposed Addition of HBCD ▌ pg. 2

- 7 Table 2

- 2 : Estimated Number of Reporting Facilities from Product Code 3261403,

Building and Construction Polystyrene Foam Products

Employment Size Class Total

Facilities Total

Employees 1 Total HBCD

(lb.) HBCD / Facility

(lb.) Facilities

Reporting

1

- 4 12 23 252,401 21,033 0

5

- 9 9 54 592,593 65,844 0

10

- 19 13 181 1,986,283 152,791 13

20

- 49 18 575 6,310,014 350,556 18

50

- 99 13 884 9,700,960 746,228 13

100

- 249 9 1,369 15,023,320 1,669,258 9

250

- 499 2 663 7,275,720 3,637,860 2

500

- 999 1 625 6,858,711 6,858,711 1

1

, 000

- 2

, 499 0 0 0 0 0

Total 2 77 4,411 48,000,000 56

1 Because employment totals for several size classes were estimated from a range, the sum of total employees by size class does not match the total employee count for the product code.

2 Totals may not sum due to rounding.

Summary: EPS and XPS Manufacturing
Using the methods outlined above, four EPS resin manufacturers are estimated to report to TRI under the proposed rule. EPS and XPS foam manufacturers can be estimated either by identifying specific facilities from trade industry information t hat could report or by using Census data to model reporting. Using the first method, 56 EPS manufacturing facilities and ten XPS manufacturing facilities are estimated to report. Using the second method, 56 EPS and XPS facilities are estimated to report. Table 2

- 3 summarizes the estimated number of forms expected from EPS and XPS manufac turers under the proposed rule. As shown in Table 2

- 3 , the two methods produce similar estimates of potential reporting. To be conservative, Method 1 is use d in th is analys i s

.

Table 2

- 3 : Estimated Reporting from EPS and XPS Manufacturers

Industry Facilities Reporting: Method 1 Facilities Reporting: Method 2

EPS Resin Manufactur ing (NAICS 325211) 4 4

EPS and XPS Foam Manufactur ing (NAICS 326140) 66 56

Total 70 60

2.2.3 Textiles

HBCD is used in certain textile applications to comply with flame retardant standards. Specifically, it is formulated as polymer

- based dispersions that are then applied in the textile finishing industry as a textile
back

- coating ( ECHA, 2008 )

. The amount of HBCD used in textile applications is estimated at about 2%

### ESTIMATES OF THE NUMBER OF REPORTS AND AFFECTED FACILITIES

Economic Analysis of Proposed Addition of HBCD ▌ pg. 2

- 8 of overall HBCD use in Europe ( ECHA, 2009 ) . These applications include upholstered furniture and seating in transportation, draperies, bed mattress ticking, a nd au tomobile textiles ( ECHA, 2009 )

. EPA recently contacted several industries, including HBCD manufacturers, furniture manufacturers, and automobile manufacturers, to better u nderstand the uses of HBCD in textiles in the U.S. Industry response suggests that HBCD is no longer used in the U.S. in consumer textiles other than automotive applications ( U.S. EPA, 2012 )

. While some contacts in the automotive industry have confirmed that HBCD will be phased out because of European REACH legislation ( U.S. EPA, 2012 )

, other automotive trade groups have indicated that they cannot guarantee the phase

- out of HBCD until functionally

- equivalent, safer alternatives are identified ( Stanton, 2012 )

. Therefore, the number of facilities in the automotive textile sector potentially reporting HBCD was estimated using available data. Because data on the use of HBCD in automotive textiles is extremely limited, several simplifying assumptions were required in order to develop estimates. These assumptions are noted in the sections below.

Automotive Textiles HBCD is processed in the automotive textile industry in two steps. First, HBCD is applied as a backcoating to textiles by automotive textile manufacturers. Second, HBCD is processed by
manufacturers who install the treated fabric in he adliners, seats, and interior trim. Because HBCD is not formed into a specific shape during manufacture, and because its end use function is not dependent on its shape, it cannot be claimed as an article. The number of facilities that would report HBCD is estimated separately for these two steps.

Approximately 2% of HBCD in Europe is used in textiles ( ECHA, 2009 ) ; usage in textiles in the U.S. is unknown but assumed to be the same as in Europe. Applying this percentage to the maximum amount of HBCD in the U.S. (50 million lb.), yields an estimate of 1 million lb. of HBCD used in the U.S. automotive textiles industry. As mentioned above, because of current efforts to phase out the use of HBCD in automotive textiles, this estimate of the amount of HBCD used in automotive textiles is likely
overstated.

A ut omotive Textile Manufacturers

Automotive textile manufacturers were identified from a list of textile companies profiled in Automotive
Textiles , 3 rd Edition ( Wilson, 2013 )

, and from conversations with an academic expert ( Powell, 2013 )

. The companies ident ified often manufacture a variety of products for the automotive sector, some of which are not treated with HBCD. Company websites and FRS were used to identify facilities owned by these companies that may be processing HBCD. In cases where product details for a facility were not available, the facility was conservatively included in the count of textile manufacturers. Therefore, it is likely that not all identified facilities process HBCD and that this method overestimates total facilities.

Employment data for textile facilities were identified using the Hoover’s database. For the several facilities that could not be located in the Hoover’s database, employment data were identified from Manta. Three facilities did not have employment data in either database . In this case, employment was assumed to be the average facility employment for their respective parents companies. A total of 81 automotive textile facilities were identified. These facilities are classified under a variety of fabric

- related NAICS codes, including:

 313111: Yarn Spinning Mills

### ESTIMATES OF THE NUMBER OF REPORTS AND AFFECTED FACILITIES

Economic Analysis of Proposed Addition of HBCD ▌ pg. 2

- 9  313230: Nonwoven Fabric Mills

 313311: Broadwoven Fabric Finishing Mills

 313312: Textile and Fabric Finishing (Except Broadwoven Fabric) Mills

 313320: Fabric Coating Mills

 314110: Carpet and Rug Mills

 336399: All oth er Motor Vehicle Parts Manufacturing

Research indicates that not all automotive manufacturers use textiles treated with HBCD, and therefore it is likely that only a subset of the identified automotive textile manufacturers use HBCD. A recent report by the Ecology Center tested over 200 new 2011

- 2012 model vehicles for brominated flame retardants (BFRs), which includes HBCD, and found that 40% of vehicle interiors contained BFRs ( The Ecology Center, 2012 )

. Furthermore, HBCD accounted for 8.2% of total BFR market demand in 2001. This analysis assumes that if 40% of cars are manufactured with BFRs then 40% of automotive textile manufacturers use BFRs, and jus t 8.2% o f these manufacturers use HBCD ( Mor ose, 2006 )

. This assumption is an oversimplification of the automotive supply chain; however, it reflects industry research indicating that only some automotive manufacturers still use HBCD

- treated fabric. Therefore, for this analysis, of the 81 facilit ies identified above, 3.3%, or three facilit ies, are estimated to use HBCD.

The amount of HBCD processed per facility was estimated by assuming HBCD use is proportional to employment. As noted above, it is estimated that 1 million lb. of HBCD is used in au tomotive textiles. This quantity can then be distributed across the facilities using HBCD by the number of employees per facility. However, while it is estimated that 3 automotive textile facilities use HBCD, the identity of and employment information for these three facilities is not known. Therefore, HBCD could not be distributed across the three facilities. Instead, the 1 million lb. of HBCD was distributed across all 81 automotive textile manufacturing facilities by facility

- specific employee counts. As all 81 facilities exceeded the 100 lb. threshold, it is assumed that HBCD at the three facilities must exceed the threshold and would be required to report to TRI under the proposed rule.

Motor Vehicle Seating and Interior Trim Manufacturing The majority of facilities processing automotive textiles treated with HBCD are in NAICS 336360: motor vehicle seating and interior trim manufacturing. These facilities use HBCD

- treated fabric to manufacture

seats, headliners, and interior trim.

Potential reporting fro m this sector was modeled using the 2007 U

. S

. Census Bureau’s Economic Census, Manufacturing Industry S eries data , which provides industry statistics includin g the number of facilities
and value a dded by employment size class. In two size classes, value added information was withheld to avoid disclosing data for individual companies. In these cases, the value added per facility was estimated to be the average value added per facility of the smaller and larger size class. As a result, the estimated

t otal value added is slightly different than the total value added for the NAICS code.

As in textile manufacturing, it was assumed that 40% of seating and trim facilities use BFRs, and 8.2% of
these facilities use HBCD. This information was used to estimate the number of facilities in each size class using HBCD. Total HBCD was distributed by value added across all size classes with at least one facility estimated to use HBCD. The average amount of HBCD used per facility processing HBCD was
then calculated fo r each size class by dividing the amount of HBCD per size class by the number of
facilities in the size class. A ll facilities exceed the 100 lb. reporting threshold, therefore; all facilities with

### ESTIMATES OF THE NUMBER OF REPORTS AND AFFECTED FACILITIES

Economic Analysis of Proposed Addition of HBCD ▌ pg. 2

- 10 10 or more employees would be required to report to TRI und er the proposed rule. Table 2

- 4 presents the estimated number of facilities reporting by employment s ize category.

Table 2

- 4 : Estimated Number of Reporting Facilities in NAICS 336360

Employment Size Class Total

Facilities Facilities

processing HBCD (0.0 33 × Total Facilities) Value

Added ($1,000) Total HBCD

(lb.) HBCD /

Facility (lb.) Facilities

Reporting

1

- 4 96 3 37,858 7,021 2,340 0

5

- 9 43 1 30,283 5,616 5,616 0

10

- 19 48 2 48,680 9,028 4,514 2

20

- 49 53 2 143,226 26,562 13,281 2

50

- 99 40 1 249,763 46,321 46,321 1

100

- 249 66 2 1,057,368 196,098 98,049 2

250

- 499 70 2 2,586,645 479,715 239,858 2

500

- 999 17 1 1,238,222 229,639 229,639 1

1000

- 2499 1 0 72,837 0 0 0

Total 1 434 14 5,464,882 1,000,000 10

1 Totals may not sum due to rounding.

Summary: Textiles Based on the methods outlined above, an estimated 3 automotive textile manufacturing facilities and 10 motor vehicle seating and interior trim manufacturers would be required to report to TRI under the proposed rule.

Table 2

- 5 : Estimated Reporting from Automotive Textile and

Motor Vehicle Seating and Interior Trim Manufacturers

Industry Facilities Reporting

Automotive Textile Manufactur ing (Misc. NAICS Codes) 3

Motor Vehicle Seating and Interior Trim
Manufactur ing (NAICS 336360) 10

Total 13

2.2.4 High Impact Polystyrene

High Impact Polystyrene (HIPS) is produced either in a batch or continuous polymerization process. The raw material is homogenized and extruded into HIPS pellets. Various flame retardants are incorporated in this process, of which HBCD constitutes a s mall percentage ( ECHA, 2008 )

. Other common flame retardants used in HIPS include decabromodiphenyl oxide (ether) (“deca

- BDE”), and oth er brominated
flame retardants ( UNEP, 2011 )

. The HIPS pe llets are then packaged and shipped to manufact urers ( ECHA, 2008 )

.

### ESTIMATES OF THE NUMBER OF REPORTS AND AFFECTED FACILITIES

Economic Analysis of Proposed Addition of HBCD ▌ pg. 2

- 11 HIPS pellets are converted into HIPS products using various extrusion techniques and injection molding. Most flame retardant HIPS products are used in electrical and electronic appliances, including audio visual equipment cabinets, dis tribution boxes for electrical lines in the construction s ector, and refrigerator lining ( ECHA, 2008 )

. The HBCD content of flame

- retarded HIPS is 1

- 7% by weight. Approximately 2% of all HBCD in Europe is used in HIPS ( European Chemicals Agency, 2009 )

. The European Brominated Flame Retardants Industry Panel (EBFRIP) has estimated that about 5% of all
HIPS in the E U is flame retarded with HBCD ( Danish Ministry of the Environment, 2010 )

.
Estimating the amount of HBCD used in HIPS As mentioned above, approximately 2% of HBCD in Europe is used in HIPS ( ECHA, 2008 )

. The use of HBCD in HIPS in the U.S. is unknown but assumed to be the same as Europe. Applying this percentage to the maximum amount of HBCD in the U.S. (50 million lb.) yields 1 million lb. of HBCD used in the U.S. HIPS industry. This estimate likely largely overstates the amount of HBCD used in HIPS given current legislation phasing out the use of HBC D in HIPS in the EU.

Estimating the number of facilities manufacturing HBCD

- treated HIPS HIPS manufacturers are covered by NAICS code 325211: Plastics material and resin m anufacturing. This
NAICS code encompasses a range of activities , of which HIPS manufa cturing is a small percentage. The product code 3252111 (t hermoplastic resins and plastics materials ) is more specific to HIPS but also includes other plastics manufacturing. The U.S. Census Bureau’s Economic Census: Manufacturing Industry Series provides industry statistics including establishment count, employee count, and value added for NAICS 325211. The 2002 Economic Census also provides a total facility count for Product
Code 3252111. This information is not available in the 2007 Economic Census. As a result, th is analysis
uses the 2002 data.

The distribution of establishments (assumed to be the same as facilities) and value added is provided by size class for NAICS 325211. In two size classes, value added data was withheld to avoid disclosing data
for individual companies. In these cases, value added was estimated to be the average of the value added per employee for the smaller and larger size class. The facility and value added distribution by size class for product code 3252111 was approximated from the sector

- wide distri bution at the NAICS code level.

Because only 5% of HIPS contain HBCD, it was assumed that only 5% of facilities in product code 3252111 will process HBCD. While this assumption is an oversimplification, it accounts for research
indic ating HBCD is not commonly used in HIPS. Therefore, 5% of facilities in each size class were estimated to be using HBCD. Total HBCD was distributed by value added across all size classes with at least one facility estimated to use HBCD. The amount of HBCD used per facility was then calculated by dividing the amount of HBCD per size class by the number of facilities processing HBCD in the size class. All facilities exceed the 100 lb. reporting threshold. Therefore, all facilities processing HBCD with
10 or m ore employees would be required to report to TRI under the proposed rule. Table 2

- 6 presents the estimated number of facilities reporting by employment size category.

### ESTIMATES OF THE NUMBER OF REPORTS AND AFFECTED FACILITIES

Economic Analysis of Proposed Addition of HBCD ▌ pg. 2

- 12 Table 2

- 6 : Estimated Number of Facilities Reporting from Product Code 3252111

Employment Size Class Total

Facilities F acilities

processing HBCD (0.05 × Total Facilities) Value

Added ($1,000) Total HBCD

(lb.) HBCD /

Facility (lb.) Facilities

Reporting

1

- 4 25 1 9,606 1,092 1,092 0

5

- 9 34 2 42,114 4,785 2,393 0

10

- 19 46 2 222,619 25,296 12,648 2

20

- 49 105 5 965,363 109,692 21,938 5

50

- 99 81 4 1,786,180 202,959 50,740 4

100

- 249 60 3 3,408,181 387,263 129,088 3

250

- 499 19 1 2,366,631 268,914 268,914 1

500

- 999 4 0 469,508 0 0 0

1

, 000

- 2

, 499 4 0 2,932,247 0 0 0

2

, 500 or more 1 0 824,667 0 0 0

Total 1 378 18 13,027,115 1,000,000 15

1 Totals may not sum due to rounding.

Estimating facilities manufacturing products using HBCD

- treated HIPS

A fter HIPS is manufactured, it is incorporated into a variety of products, including electronic equipment
and video and audio equipment housings. Available information regarding current uses of HBCD

- treated

HI PS is limited, and estimating reporting for this sector was not possible. However, because of the limited
use of HBCD

- treated HIPS and the current transition to other flame retardants, the number of facilities that will report HBCD fo r this use is likely v ery small.



### 2.3 Summary

Table 2

- 7 provides a breakdown of estimated reporting by industry sector under the proposed rule. Of the 101 facilities, three are HBCD manufacture rs, four manufacture EPS resin, 66 manufacture EPS and XPS products, 13 manufacture or process HBCD

- treated textiles, and 15 manufacture HBCD

- treated HIPS.

Table 2

- 7 : Total Estimated Reporting Under the Propo sed HBCD Rule

Industry Facilities Reporting 1

HBCD Manufactur ing (NAICS 325) 3

EPS Resin Manufactur ing (NAICS 325211) 4

EPS and XPS Foam Manufactur ing (NAICS 326140) 66

Automotive Textile Manufactur ing (Misc. NAICS Codes) 3
Motor Vehicle Seating and Interior Trim Manufactur ing (NAICS 336360) 10

HIPS Manufactur ing (NAICS 325211) 15

Total 101

1 Assumes Method 1 for EPS and XPS Foam Manufacturing

### COST ESTIMATES

Economic Analysis of Proposed Addition of HBCD ▌ pg. 3

- 1 

## 3. Cost Estimates

This chapter presents the estimated industry and EPA costs associated with the proposed rule to add
HBCD to the list of chemicals subject to TRI reporting. Section 3.1 describes the methodology used to estimate industry reporting burden and cost and presents the resulting estimates. Section 3.2 details the
estimated cost to EPA. Section 3.3 summarizes the total cost of the proposed rule.



### 3.1 Industry Burden and Cost Estimates

Industry burden and costs assoc iated with the proposed rule are estimated using ratio

- based burden methodology (RBBM). RBBM is a simplification of the previous methodology for estimating reporting
burden and cost ( U.S. EPA, 2011b )

. Section 3.1.1 descr ibes the estimation of industry burden using
RBBM. Section 3.1.2 describes the estimation of industry cost using RBBM. Sections 3.1.3 and 3.1.4

p resent the resulting industry burden and cost estimates. Section 3.1.5 presents annualized industry costs.

3.1.1 Estimation of Burden

Compared to the previous method used to estimate reporting burden, RBBM simplif ies calculations,
supports internal consistency , and sharpens transparency while retaining the components of the previous methodology. The foundation of RBBM is its use of ratio models to maintain relationships between related categories of reporting activities. Reporting activities can be divided into two distinct groups: Form Activities, consisting of rule familiarization, reporter compliance determination, calculations and form completion, and recordkeeping and submission; and Non

- Form Activities, consisting of supplier
notifications and non

- reporter compliance determination. Specifically, the following activities may be undertaken under the proposed rule.

Form Activities

Rule Familiarization : Staff at a facility that is reporting under EPCRA §313 for the first time must read the reporting package and become familiar with the reporting requirements. This activity includes the time needed to review instructions as well as the time needed to train personnel to respond to an information collection request.

Reporter Compliance Determination : Staff at repor ting facilities must make the determination that the facility meets the criteria for EPCRA §313 reporting. This activity includes the time required to become familiar with the definitions, exemptions, and threshold requirements under the TRI Program,

to re view the list of TRI chemicals, and to conduct preliminary threshold determinations to determine if the facility is required to report.

Calculations and Form Completion : Staff at reporting facilities must gather data and perform calculations to provide the information required on the form. This activity includes the time required to search data sources and to complete and review the information.

Recordkeeping and Submission : Staff at reporting facilities must maintain recordkeeping systems and
submit the re port to EPA and the state in which the facility is located. This activity includes the time required to transmit or otherwise disclose the information.

### COST ESTIMATES

Economic Analysis of Proposed Addition of HBCD ▌ pg. 3

- 2 Non

- Form Activities 5

Supplier Notification : Certain suppliers of mixtures or trade name products contain ing reportable substances must annually notify their customers of the product's composition if the customer is subject to EPCRA §313 reporting. This activity includes the required staff time at reporting facilities to inform customers either by letter or t hrough the materials safety data sheet (MSDS) for the product. Under the proposed rule, EPA assumes that the number of facilities that might be required to provide supplier notifications would only be a small fraction of potential supplier notifications in connection with the TRI program overall. Therefore, no additional supplier notification burden is estimated in connection with the proposed rule.

Non

- Reporter Compliance Determination : In any given reporting year, a group of eligible facilities will comp lete compliance determination but will not file a Form R or Form A. The activity is the same as is presented above under Form Activities; however, given that compliance determination applies to all other facilities in NAICS code

- eligible sectors (with ten or more employees)

— including those that ultimately do not report to TRI

— the latter category is accounted for in this separate activity. For this proposed rule, it is assumed that the addition of HBCD constitute s a modest change when compared to the total n umber of chemicals subject to the program. Thus, it is assumed that the

non

- reporter compliance determination burden is already included in the existing compliance
determination burden estimates.

The skills required to comply with the s ection 313 reportin g requirements (including the requirements
associated with S ection 6607 of the Pollution Prevention Act) are expected to vary from facility to facility, depending upon factors such as: the complexity of the facility's processes and activities; the
chemical s used at the facility; and the types of use and disposition of TRI chemicals at the facility. Individuals responsible for determining whether their facility is required to report and, if so, completing a Form R and Form A report (or multiple Form R and Fo rm A reports) would often have an engineering, scientific, or technical background. These functions, however, do not require an engineering or other similar degree.

At a minimum, an understanding of the facility‘s chemical purchases and production processe s are needed. Necessary skills may include the ability to evaluate and interpret records, understand material safety data sheets, and determine throughput or production volumes. Depending on the facility, estimates may be calculated using: (1) existing dat a collected under federal, state, or local regulations; (2) emissions factors; (3) design data supplied by the equipment manufacturer; (4) mass balance techniques; or (5) engineering calculations. Each technique requires varying skills and levels of sophis tication to complete. EPA industry

- and chemical

- specific guidance documents would assist reporters in making the necessary calculations to comply with the s ection 313 reporting requirements. In addition to technical labor, requirements for managerial and clerical staff are also considered when estimating burden and costs.

Estimating reporting burden using RBBM produces a burden estimate that reflects overall “average” reporting conditions at reporting facilities. Burden calculations using RBBM involve the following key
parameters:

5 Note that while petitions are considered in the overall burden/cost of the TRI program, they are not considered in this rulemaking as they are not related to the proposed addition of HBCD to the list of TRI

- reportable chemicals.

### COST ESTIMATES

Economic Analysis of Proposed Addition of HBCD ▌ pg. 3

- 3 Nominal Form R Unit Burden , which reflects the burden incurred by reporters to undertake all activities necessary to file a single Form R (including both facility

- and form

- level activities). Nominal Form R
Unit Burden is set at 3 5.70516 hours. 6

A/R is the ratio of Form A burden to Form R burden. A/R is calculated to be 0.615, reflecting the fact that filing a Form A results in a 38.5% (1.00

– 0.615 = 0.385, or 38.5%) reduction in burden per chemical compared to filing a Form R. Nominal Form R Unit Burden is multiplied by A/R to estimate burden
associ ated with reporting a Form A chemical

.

RBBM uses the estimated number of Form R and Form A chemicals

, Nominal Form R Unit Burden

, A/R

, and Non

- Form Burden to calculate Steady State Total Burden (previously referred to as “Subsequent Year Burden”) as shown in Equation 3

- 1

.

Equation 3

- 1 : Steady State Total Burden Calculation

Steady State Total Burden = Form R Burden + Form A Burden + Non

– Form Burden

Where: Form R Burden = (Number of Form Rs)×(Nominal Form R Unit Burden) Form A Burden = (Number of Form As)×(A/R)×(Nominal Form R Unit Burden)

Non

- Form Burden = Supplier Notifications + Non

- Reporter Compliance Determination

Steady State Total Burden does not incorporate the greater burden incurred by facilities subject to TRI for the first time. RBBM accounts for the higher r eporting burden in the first year through the use of the

First

- Time Filer Factor ( FTF f ). FTF f is calculated to be 2.1, indicating that burden in the first year of a rule is estimated to be roughly twice the ongoing burden. First Year Total Burden is calcul ated by multiplying the Steady State Burden by FTF f , as shown in Equation 3

- 2

.
Equation 3

- 2 : First Year Total Burden Calculation

First Year Total Burden = Steady State Total Burden × FTF f

3.1.2 Estimation of Cost

To estimate total reporting cost, RBBM uses the Weighted Average Wage Rate ( WAWR ), which is the average loaded cost for a combination of Managerial, Technical and Clerical labor per hour of TRI reporting burden. WAWR is based on the total cost to employ an individual and includes the cost of salaries, fringe benefits ( e.g. , paid leave ), health insurance, retirement savings, legally required benefits, and other overhead costs, such as office space, furniture, equipment and computers, suppli es and other business expenses.

According to feedback from existing TRI filers, the role of each l abor category in the TRI reporting process at the facility level is as follows:

 Managerial staff are responsible for reviewing and certifying the accuracy of all TRI submissions and supporting documentation, including calculations, data sources, and assump tions. Managerial

6 The burden of 35.70516 includes the addition of 0.00516 hours of burden associated with the Dioxin Reporting Requirements promulgated in May of 2007 and accounted for in the 2011 ICR (U.S. EPA, 2011b).

### COST ESTIMATES

Economic Analysis of Proposed Addition of HBCD ▌ pg. 3

- 4 staff are briefed by technical staff once annually regarding TRI submissions and any changes to TRI reporting requirements. All sections of the Form are reviewed by managerial staff at this
time.

 Technical staff possess the facility knowl edge and familiarity with the TRI program required to understand which processes and activities at the facility should be considered in making threshold determinations for TRI chemicals. Technical staff gather the required data, make threshold
determinatio ns, calculate release and waste management quantities, and enter the required data on the TRI form, either by hand or electronically using TRI reporting software. Technical staff are also responsible for briefing managerial staff once annually regarding TR I submissions and any changes to TRI reporting requirements.

 Clerical staff are responsible for organizing, photocopying, and cataloging all TRI submissions and supporting documentation in accordance with TRI recordkeeping requirements. Note that as
report ing facilities move toward filing TRI reports electronically, clerical time is minimized.

WAWR is calculated using data from the Bureau of Labor Statistics on “Wages and Salaries” and “Total Benefits” for three labor categories: Managerial (the “Management, Business, and Financial” occupational category), Technical (the “Professional and Related” occupational category), and Clerical (the “Office and Administrative Support” occupational category) ( U.S. BLS, 2014c ) . Total Compensation is equal to the sum of Wages and Salaries and Total Benefits. Based on information provided by the chemical industry and chemical industry trade associa tions, a loading factor of 17 percent is applied to Wages and Salaries to calculate Overhead ( Heiden Associates, 1989 )

. The sum of Total Compensation and Overhead is equal to the Total Loaded Hourly Wage Rate. The Total Loaded Hourly Wage Rates for these labor categories are weighted by the rela tive contribution of each labor category to TRI reporting activities derived from Engineering Studies conducted by Abt Associates ( Ab t Associates, 2004 )

. The
calculation of WAWR is shown Equation 3

- 3

.

Equation 3

- 3 : Weighted Average Wage Rate Calculation

WAWR = ( w Managerial × p Managerial ) + ( w Tec h nical × p Tec h nical ) + ( w Clerical × p Clerical )

Where:

w i = Total Loaded Hourly Wage Rate for labor category i, given by the formula:

Total Loaded Hour ly Wage Rate = Wages and Salaries + Total Benefits + (17% × Wages and Salaries)

p i = Proportion of overall reporting burden borne by labor category i

The loaded hourly wage rates (in 201 3 dollars) are $68.45 for managerial personnel, $ 50.64 for technica l personnel, and $26. 28 for clerical personnel. The relative fixed weights are 0.03 for Managerial, 0.89 for Technical, and 0.08 for Clerical. As shown in Table 3

- 1

, WAWR is calculated at $ 49.25

.

### COST ESTIMATES

Economic Analysis of Proposed Addition of HBCD ▌ pg. 3

- 5 Table 3

- 1 : Derivation of Weighted Average Wage Rate (201 3 Dollars )

Wage Type Managerial Technical Clerical
Wages and Salaries $4 2 .35 $3 2.04 $16. 27

Total benefits $1 8. 90 $1 3. 15 $7. 24

Overhead $7. 20 $ 5. 45 $2. 77

Total Loaded Hourly Wage Rate $6 8.45 $ 5 0.64 $2 6. 28
Labor Burden Weights 1 0.03 0.89 0.08
Weighted Average Wage Rate (WAWR) $ 49.25

1 Labor burden weights have been rounded for ease of presentation. Source: ( U.S. BLS, 2014c )

.

Steady State Total Cost and Firs t Year Total Cost are calculated by multiplying the relevant total burden by WAWR , as shown in Equation 3

- 4 and Equation 3

- 5

.
Equation 3

- 4 : Steady State Cost Calculation

Steady State Total Cost = Steady State Total Burden × WAWR

Equation 3

- 5 : First Year Cost Calculation

First Year Total Cost = First Year Total Burden × WAWR

3.1.3 Total Industry Burden Estimates

The Steady State Total Burden estimated to be incu rred by filers in subsequent years of this proposed rule is calculated by multiplying the estimated number of Forms Rs that will be filed as a result of the proposed rule by the Nominal Form R Unit Burden. No Form As are anticipated due to the proposed rul e. Non

- form burden is assumed to be zero. 7

Table 3

- 2 presents the number of Form Rs estimated to be filed by facilities potentially affected by the proposed rule, the first year total burden (calculated using Equation 3

- 1 ), and the steady state total burden (calculated using Equation 3

- 2 )

.

7 Under the proposed rule, EPA assumes that the numbe r of facilities that might be required to provide supplier notifications would only be a small fraction of potential supplier notifications in connection with the TRI program overall. Therefore, no additional supplier notification burden is estimated in co nnection with the proposed rule.

### COST ESTIMATES

Economic Analysis of Proposed Addition of HBCD ▌ pg. 3

- 6 Table 3

- 2 : Estimated Number of Facilities Expected to Incur Reporting Burden
, Total First

Year Burden, and Total Steady State Burden under the Proposed Rule

Sector Number of Reporting Facilities Number of

Form Rs First Year

Total Burden (Hours) Steady

State Total Burden (Hours)

HBCD Manufacturing (NAICS 325) 3 3 225 107

EPS Resin Manufacturing (NAICS 325211) 4 4 300 143

XPS and EPS Foam Manufacturing (NAICS 326140) 66 66 4,949 2,357

Automotive Textile Manufacturing (Misc. NAICS Codes) 3 3 225 107

Motor Vehicle Seating and Interior Trim Manufacturing (NAICS 336360) 10 10 750 357

HIPS Manufacturing (NAICS 325211) 15 15 1,125 536

Total 101 101 7,573 3,606

Under the proposed rule, industry is estimated to incur approximately 7,600 burden hours in the first year and approximately 3,600 burden hours in the steady state.

3.1.4 Total Industry Cost Estimates

To estimate the cost of the proposed rule, total first year and total steady state industry reporting burden is multiplied by the Weighted Average Wage Rate (see Equation 3

- 4 and Equation 3

- 5 ); the first yea r and steady state costs are presented in Table 3

- 3

.

Table 3

- 3 : Total First Year and Steady State Industr y Cost under th e Proposed Rule

Sector Number of Reporting Facilities Number

of Form Rs First Year

Total Cost ( 2013 Dollars ) Steady State

Total Cost ( 2013 Dollars )

HBCD Manufacturing (NAICS 325) 3 3 $11, 078 $5,275

EPS Resin Manufacturing (NAICS 325211) 4 4 $ 14,771 $7,034

XPS and EPS Foam Manufacturing (NAICS 326140) 66 66 $243,725 $116,060

Automotive Textile Manufacturing (Misc. NAICS Codes) 3 3 $11,078 $5,275

Motor Vehicle Seating and Interior Trim Manufacturing (NAICS 336360) 10 10 $36,928 $17,585

HIPS Manufacturing (NAICS 325211) 15 15 $55,392 $26,377

Total 101 101 $372,973 $177,606

### COST ESTIMATES

Economic Analysis of Proposed Addition of HBCD ▌ pg. 3

- 7 Under the proposed rule, industry is estimated to incur approximately $373,000 in the first year and approximately $178,000 in the steady state.

3.1.5 Annualized Cost Estimates

The total cost to industry associated with the proposed rule is annualized over a ten

- year period using Equation 3

- 6 below.

Equation 3

- 6 : Cost Annualization

Annualized Cost = Present Value of Costs × r × ( 1 + r ) 10 ( 1 + r ) 10

− 1

Wher e:

Present Value of Costs = ∑ Cos t t × 1 ( 1 + r ) t t = 10 t = 1

a nd r = 3% or 7%

Ten years is assumed to be a reasonable timeframe for annualization, as greater than forty percent of TRI facilities reported every year from reporting year 200 3 to reporting year 2012 . The annualized cost
reflects both the first

- year costs and steady

- stat e costs presented in Section 3.1.4 . Industry costs are annualized both at a 3% discount rate and a 7% discount rate, 8 resulting in annualized per

- Fo rm R costs
of $ 1,978.64 and $ 2,015.87 , respectively. Total annualized industry costs are presented in Table 3

- 4

. 9

8 Pursuant to guidance issued by the Office of Management and Budget (OMB), federal agencies should take into account when costs and benefits will actually occur. Thus, costs and benefits that will accrue in the future mus t be discounted to present day dollars. Further, OMB’s guidance recommends federal agencies use discount rates of three and seven percent to estimate a range of average potential returns on investments. More information is available at http://www.whitehous e.gov/sites/default/files/omb/assets/omb/circulars/a004/a

- 4.pdf.

9 The annualization method used assumes that first

- year costs are incurred at the end of the first year, and are thus discounted. No initial (undiscounted) costs are expected under the propos ed rule.

### COST ESTIMATES

Economic Analysis of Proposed Addition of HBCD ▌ pg. 3

- 8 Table 3

- 4 : Total Annualized Industry Cost u nder the Proposed Rule

Sector Number of Reporting Facilities Number

of Form Rs Total

Annualized Cost (3%, 2013 Dollars) Total

Annualized Cost (7%, 201 3 Dollars)

HBCD Manufacturing (NAICS 325) 3 3 $5,936 $6,048

EPS Resin Manufacturing (NAICS 325211) 4 4 $7,915 $8,063

XPS and EPS Foam Manufacturing (NAICS 326140) 66 66 $130,590 $133,047

Automotive Textile Manufacturing (Misc. NAICS Codes) 3 3 $5,936 $6,048

Motor Vehicle Seating and Interior Trim Manufacturing (NAICS 336360) 10 10 $19,786 $20,159

HIPS Manufacturing (NAICS 325211) 15 15 $29,680 $30,238

Total 101 101 $199,843 $203,603



### 3.2 EPA Cost Estimates

For the TRI program in general, EPA incurs burden and cost to process TRI forms in five categories of activities: data processing, outreach and training, information dissemination, policy and petitions, and compliance and enforcement. The estimate of EPA b urden and costs is separated into a fixed component and a variable component. Activities and expenses that are not greatly affected by marginal changes in report quantities are considered fixed costs. These activities and expenses include rent for the EPCR A Reporting Center, development costs for data access tools, compliance assistance measures, and other activities and expenses listed above. There are no additional fixed costs to the Agency associated with the proposed rule. Activities and expenses that v ary with marginal changes in the number of reports
submitted are considered variable costs. T he primary variable cost analyzed in this analysis is the cost of processing forms

. As of January 21, 2014, all non

- trade secret forms must be submitted electroni cally. EPA estimates that the processing cost for TRI

- MEweb submissions is $3.33 per form. 10 Therefore, the total form processing
burden for EPA associated with Form R and Form A chemical submissions under the proposed rule is estimated at $ 336.

10 Source: Personal communication with Juan Parra. TRI Information and Outreach Branch. January 9, 2012. Cost s updated to 201 3 dollars using the Employment Cost Index (U.S. BLS, 2014b).

### COST ESTIMATES

Economic Analysis of Proposed Addition of HBCD ▌ pg. 3

- 9 

### 3.3 Total Costs

As shown in Table 3

- 5 , the estimated total cost of the proposed rule

— the sum of annualized industry

c osts and agency costs

— is approximately $ 200 ,000 with a 3% discount rate and approximately $ 20 4 ,000
with a 7% discount rate.

Table 3

- 5 : Summary of Total Costs of the Proposed Rule

Cost Category Total Cost (3% Discount Rate, 201 3 Dollars) Total Cost (7% Discount Rate, 201 3 Dollars)

Industry Costs $199, 8 43 $203,603

EPA Processing Costs 1 $336 $336

Total Costs $200,179 $203,939

1 The annual and annualized EPA processing costs are the same as they are assumed constant across the ten year time frame.

### SMALL ENTITY ANALYSIS

Economic Analysis of Proposed Addition of HBCD ▌ pg. 4

- 1 

## 4. Small Entity Analysis

This chapter addresses the potential impacts of the proposed rule on small entities. Section 4.1 discusses the regulatory requirement for this analysis. Section 4.2 provides the definitions of small entities for the industry groups affected by the proposed rule. Section 4.3 describes the methodology used to determine if the proposed rule results in a significant economic impact to a substantial number of small entities.
Section 4.4 summarizes the results for all small entities affected by the proposed rule.



### 4.1 Impact on Small Entities

The Regulatory Flexibility Act (RFA) of 1980 (5 U.S.C. § 601 et. seq. ) requires federal agencies to assess
the effect s of regulations on small entities, including businesses, nonprofit organizations, and governments, and, in some instances, to examine alternatives to the regulations that may reduce adverse economic effects on significantly impacted small entities. Sectio n 604 of the RFA, as amended by the Small Business Regulatory Enforcement Fairness Act (SBREFA) of 1996, requires an agency to perform a regulatory flexibility analysis for a rule unless the agency certifies under section 605(b) that the regulatory action would not have a significant economic impact on a substantial number of small entities. The RFA does not specifically define “a significant economic impact on a substan tial number” of small
entities.



### 4.2 Definitions of Small Entities

The RFA uses the definitio n of “small business” found in the Small Business Act, which authorizes the Small Business Administration (SBA) to define “small business” by regulation. This analysis uses the SBA’s definition of a small business for each industry affected by the proposed rule ( U.S. SBA, 2014 )

. SBA's small business size definitions vary by industry. In establishing size standards, SBA considers a number of economic and market characteristics that may allow a business of concern to exercise dominance in an industry. Size sta ndards are based on criteria

— such as annual receipts or number of employees

— that represent a measure of these characteristics. These standards represent the largest size
that a for

- profit enterprise (together with its affiliates) may be and sti ll qualify a s a small business.

The SBA small business size standards are expansive, classifying most businesses as “small” ( U.S. SBA,
2014 )

. For example, the smallest SBA size standard for manufacturing industries (NAICS 31

- 33) is 500 employees. According to the U.S. Census Bureau’s Statistics of U.S. Businesses , 251,417 of 254,941 manufacturing firms have fewer than 500 employees ( U.S. Census Bureau, 2013 )

. Therefore, at least 98.6% of manufacturing firms are classified as small businesses according to the SBA definition. In fact, this percentage is actually higher, since for certain industrial classification codes within the broader manufacturing sector, t he SBA size standards are greater (750, 1,000, or 1,500 employees). Table 4

- 1 l ists
the small business size standards for the industries affected by the proposed rule.

### SMALL ENTITY ANALYSIS

Economic Analysis of Proposed Addition of HBCD ▌ pg. 4

- 2 Table 4

- 1 : Small Business Size Standards for Industry Sectors

Affected by the Proposed Rule

Sector NAICS Assignment Small Business Size Standard
HBCD Manufacturing Chemical Manufacturing (NAICS 325) 500 employees 1

EPS Resin Manufacturing Plastics Material and Resin Manufacturing (NAICS 325211) 750 employees

XPS and EPS Foam Manufacturing Polystyrene Foam Product Manufacturing (NAICS 326140) 500 employees

Automotive Textile Manufacturing (Misc. NAICS Codes) Multiple

Motor Vehicle Seating and Interior Trim Manufacturing Motor Vehicle Seating and Interior Trim Manufacturing (NAICS 336360) 500 employees

HIPS Manufacturing Plastics Material and Resin Manufacturing (NAICS 325211) 750 employees

1 NAICS 325 has multiple SBA size standards, as standards are provided at the six

- digit NAICS code level. 500 employees is the
smallest threshold in NAICS 325xxx.

The RFA defines a “small governmental jurisdiction” as the governments of a city, county, to wn, school district, or special district with a populat ion of less than 50,000 people. The RFA defines a “small organization” as any “not

- for

- profit enterprise which is independently owned and operated and is not
dominant in its field.”



### 4.3 Methodology Overvie w

This analysis uses annualized cost impact percentages to measure potential impacts on small parent entities that own facilities affected by the proposed rule. The universe of potentially affected facilities was estimated using a variety of data sources and methods, as described in detail in Chapter 2 . The number of facilities expected to report in each sector under the proposed rule is summarized in Table 4

- 2 . In this chapter, a determination is made as to the likelihood that the parent companies of these facilities are (1) small and (2) if small, disproportionately affected by t he proposed rule

.

### SMALL ENTITY ANALYSIS

Economic Analysis of Proposed Addition of HBCD ▌ pg. 4

- 3 Table 4

- 2 : Estimated Number of Facilities Expected to Report under the Proposed Rule

Sector Number of Facilities Number of Form R s HBCD Manufacturing (NAICS 325) 3 3
EPS Resin Manufacturing (NAICS 325211) 4 4
XPS and EPS Foam Manufacturing (NAICS 326140) 66 66
Automotive Textile Manufacturing (Misc. NAICS Codes) 3 3
Motor Vehicle Seating and Interior Trim Manufacturing (NAICS 336360) 10 10

HIPS Manufacturing (NAICS 325211) 15 15

Total 101 101

The annualized cost impact percentage is defined as annualized compliance costs resulting from the proposed rule as a percentage of annual revenues or sales, a commonly available and objective measure of a company’s busin ess volume.

Annualized compliance costs are estimated using ratio

- based burden methodology (RBBM)

. 11 RBBM yields a per

- form cost estimate that reflects average conditions at reporting facilities in the first year of a rule and in the steady state. Pursuant to guidance issued by the Office of Management and Budget (OMB), these costs are then annualized at a seven percent discount rate, 12 resulting in an annualized per

Form R cost of $2, 01 6 . (For more information on cost annualization, see S ection 3.1.5 .)

As small en tity impacts are assessed at the parent entity level, annualized per

- form costs are multiplied by the number of forms per facility and the number of facilities per parent entity to estimate total annualized parent entity compliance costs. Cost impact perce ntages are calculated for the incremental compliance costs incurred as a result of the proposed rule, as shown in Equation 4

- 1 . Where regulatory costs represent

a sma ll fraction of a typical entity’s revenue, the impacts of the regulation are likely to be minimal.

Equation 4

- 1 : Calculation of Cost Impact Percentages

Annualized Cost Impact Perce n tage = Annualized Parent Entity Compliance Cost

Annual Parent Entity Revenue

11 See Chapter 3 and Revising TRI Burden to Ratio

- Based Methodology (U.S. EPA, 2011b).

12 OMB’s guidance recommends federal agencies use discount rates of three and seven percent to estimate a range of

average p otential returns on investments (m ore information is available at http://www.whitehouse.gov/sites/default/files/omb/assets/omb/circulars/a004/a

- 4.pdf. ). As using a 7% discount rate results in higher annualized costs and therefore a more conservative estimate of small entity impacts, only the 7% discount rate is used for the small entity analysis. If no impacts are experienced at the 7% level, the same is true for impacts at the 3% level.

### SMALL ENTITY ANALYSIS

Economic Analysis of Proposed Addition of HBCD ▌ pg. 4

- 4 Where Annualized Parent Entity Compliance Cost = Annualized Cost
Per Form × Number of Forms

Per Facility ×

Number of Facilities
Per Parent Entity

The general methodology used to estimate impacts on small entities consists of the following steps:

Step 1: Identi fy the universe of facilities expected to incur compliance costs due to the proposed rule.

Step 2: Characterize the relationships between these facilities and their global ultimate parent
entities. 13

Step 3: Estimate annual revenues of parent entities. 14

Ste p 4: Identify small parent entities based on SBA or RFA definitions.

Step 5: Develop annualized compliance cost estimates for small parent entities using the per

- facility reporting cost and the number of facilities per parent entity that will report to TRI

.
Step 6: Calculate the entity

- level impact percentages, defined as annualized compliance costs as a percentage of annual revenues , to measure regulatory burden.

Step 7: Estimate the number and percentage of small parent entities with entity

- level impact

p ercentages in each of three categories: (1) less than one percent of annual revenues; (2) between one and three percent of annual revenues; and (3) greater than or equal to three percent of annual

revenues.

The specific methodology applied to each sector d iffers slightly from the general methodology above depending on the data available. For the EPS resin manufacturing, XPS and EPS foam manufacturing,
and automotive textile manufacturing sectors, all facilities expected to report under the proposed rule are known and there are sufficient data available to conduct the small entity analysis using actual facility
data. For the HBCD manufacturing, automotive textile manufacturing, and HIPS manufacturing sectors,

non e (or only a small subset) of the facilities expected to report und er the proposed rule are known;
C ensus data are therefore used to model small entity impacts. The following sections describe the specific methodology used for each sector in greater detail

.

4.3.1 Sectors Analyzed using Actual Facility Data (EPS Resin Manufacturing, XPS and EPS Foam Manufacturing, and Automotive Textile Manufacturing)

All facilities in the EPS resin manufacturing, XPS and EPS foam manufacturing, and automotive textile
manufacturin g sectors ex pected to report under the proposed rule are known. For these facilities, cost

13 The global ultimate parent entity is the uppermost parent or h eadquarters that encompasses all directly related branches, subsidiaries, or parents of a specific business at a specific location. For the purposes of this analysis, “parent entity” is synonymous with “global ultimate parent entity,” and denotes a global ultimate parent company owning a facility expected to report under the proposed rule; “small parent entity” denotes a small ultimate parent entity (as defined by the Small Business Administration or RFA threshold) owning a facility expected to report
under the proposed rule.

14 R evenues are converted to 201 3 dollars us ing the GDP inflation index (U.S. BEA, 2014).

### SMALL ENTITY ANALYSIS

Economic Analysis of Proposed Addition of HBCD ▌ pg. 4

- 5 impact percentages are calculated using estimated compliance costs per facility (based on the number of reports the facility is expected to submit), the number of af fected facilities per parent entity, and the annual revenue of each parent entity. Parent entities are classified as large or small, and impacts to small parent entities are summarized.

Identification of Small Parent Entities and Generation of Revenue Data Each facility’s global ultimate parent company was identified using data obtained from Hoover’s, Inc.’s
business information database ( Hoover's Inc, 2014 )

. 15 Hoover ’ s provides a range of business data including number of employees, annual revenue, NAICS code, and the identity of a facility’s parent entity. When Hoover’s data were incomplete or outdated, alternati ve resources such as company websites and annual reports were used to obtain missing data. With this information, it is possible to classify parent entities as small using the thresholds for the parent entity’s NAICS code. 16

In the automotive textile manufa cturing sector, 81 potentially affected facilities were identified, of which only 3 are expected to report. However, as it is not possible to determine which 3 facilities are expected to report, the small entity analysis for the automotive textile manufact uring sector was conducted for all 81 potentially affected facilities , and the worst

- case scenario (based on the calculated cost impact percentage, corresponding to all three facilities being owned by a single small parent entity) was used for the small

en tity analysis

.

Table 4

- 3 displays the number of facilities, parent entities, and small parent entities for these sectors based on revenue and employment data obtained from Hoover’s. While the EPS resin and XPS foam manufacturing sectors have no small parent entities, the E PS foam and automotive textile manufacturing sectors both have small parent entities. In particular, a large proportion ( 93 %) of the parent entities in the
EPS foam manufacturing sector is small.

15 This analysis assumes that a facility, as defined under TRI, is equivalent to a location as defined by Hoover’s

.

16 The small entity determinati on is made using the NAICS code of the global ultimate parent entity rather than the NAICS code of the facility subject to TRI. In some cases, the NAICS code of the parent entity is different from the facility’s NAICS code.

### SMALL ENTITY ANALYSIS

Economic Analysis of Proposed Addition of HBCD ▌ pg. 4

- 6 Table 4

- 3 : Summary o f EPS Resin Manufacturing, E PS and X PS Foam Manufacturing,

and Automotive Textile Manufacturing Universe

Sector Facilities Parent Entities Small Parent Entities

EPS Resin Manufacturing (NAICS 325211) 4 3 0

XPS and E PS Foam Manufacturing (NAICS 326140) 66 31 26

Automotive Textile Manufacturing (Misc. NAICS Codes) 3 1 1 1

Total 7 3 35 27

1 Note that 81 facilities were identified in the automotive textile manufacturing sector, of which only 3 are expected to repor t. Given that it is not possible to identify which 3 facilities are expected to report, small entity impacts are assessed for th e worst

case scenario , which is a single small parent entity with revenues of approximately $27 million that owns three potentially affected facilities

.

Estimation of Compliance Costs Compliance costs are calculated at the parent entity level by multiplying the per

- Form R cost by the estimated number of Form Rs submitted by all facilities expected to report that are owned by that parent entity. In the EPS resin manufacturing and X PS foa m manufacturing sectors, no small parent entities are expected to be affected by the proposed rule.

In the E PS foam manufacturing sector, 26 small parent entities are expected to be affected by the proposed rule. These small parent entities own between one and nine affected facilities, corresponding to annualized parent

- entity compliance costs ranging from $ 2,016 to $ 18,143 at the 7% discount level.

In the automotive textile manufacturing sector, one small parent entit y is expected to be affected by the proposed rule. Th is small parent entit y own s three affected facilities, corresponding to annualized parent

entity compliance costs of $6,048 at the 7% discount level.

Estimation of Cost Impact Percentages Cost impact percent ages for small parent entities are calculated by dividing annualized parent entity compliance costs by the parent entity’s annual revenue. The estimated impacts on small parent entities are presented in Table 4

- 4 below. Of the small parent entities identified, all have annualized cost impacts of
less than 1%.

### SMALL ENTITY ANALYSIS

Economic Analysis of Proposed Addition of HBCD ▌ pg. 4

- 7 Table 4

- 4 : Small Entity Impacts in EPS Resin Manufacturing, XPS and EPS Foam Manufacturing, and Automotive Textile Manufacturing Universe Sectors

Sector Small

Parent Entities Incurring Impacts of <1% Small

Parent Entities Incurring Impacts of 1% to 3% Small

Parent Entities Incurring Impacts of >3% Minimum

Impact Maximum

Impact Mean

Impact Median

Impact

EPS Resin Manufacturing (NAICS 325211) 0 0 0 NA NA NA NA

XPS and E PS Foam Manufacturing (NAICS 326140) 26 (100%) 0 0 0.005% 0.4 59 % 0.0 57 % 0.03 7 %

Automotive Textile Manufacturing (Misc. NAICS Codes) 1 (100%) 0 0 0.0 2 2 % 0.02 2 % 0.0 2 2 % 0.0 2 2 %

Total 27 0 0

4.3.2 Sectors Analyzed using Census Data (HBCD Manufacturing
, Automotive Textile Manufacturing , and HIPS Manufacturing )

As actual facility information is known for only one of the three facilities in the HBCD manufacturing sector expected to report (the two remaining facilities’ information is classified as confidential business information), and none of the facilities in the motor vehicle seating and interior trim m anufacturing and HIPS manufacturing sectors, impacts to small entities in these sectors are modeled using national

- level data from the U.S. Census’ Statistics of U.S. Businesses (SUSB ).

SUSB provides annual data for U.S. business enterprises, including cou nts of establishments, firms, employees, and payroll. Data on total receipts (revenues) are also provided by SUSB every five years. These data are available for each NAICS code tabulated by enterprise employment or enterprise revenue ( U.S. Census Bureau, 2007 )

. SUSB data tabulated by enterprise revenue are used to estimate the number of small parent entities affected under the proposed rule and estimate the proportion of small parent entities incurring cost impacts greate r than 1% or 3%.

SUSB defines an enterprise as “a business organization consisting of one or more domestic establishments that were specified under common ownership or control,” a firm as “a business organization consisting of one or more domestic establis hments in the same industry that were specified under common ownership or control,” and an establishment as “a single physical location where business is conducted or where services or industrial operations are performed” (equivalent to TRI’s definition of a facility ). For the purposes of this analysis, it is assumed that the SUSB concept of an enterprise is equivalent to the concept of ultimate parent company used in this small entity analyses.

The small entity analysis for these sectors is conducted by:

(1) Estimating key revenue thresholds using BLS and Census data;

(2) Estimating the number of parent entities;

### SMALL ENTITY ANALYSIS

Economic Analysis of Proposed Addition of HBCD ▌ pg. 4

- 8 (3) Estimating annualized parent entity compliance costs and impact thresholds ;

(4) Constructing parent entity revenue percentiles to character ize revenues in th e sector; and

(5) Estimating small entity impacts.

This methodology is explained in greater detail in the following sub sections

.
Estimation of Key Revenue Thresholds

Bureau of Labor Statistics data on sector

- specific wages are first inflated to 201 3 dollars using a GDP inflation index and then used to calculate loaded hourly wage rates (including an estimated 17% overhead, as in the calculation of the Weighted Average Wage Rate in Chapter 3 ) in each sector ( U.S BEA, 2014 ; U.S. BLS, 2014a )

. T his loaded hourly rate is then converted into a mean loaded annual wage per full

- time employee by multiplying by 2,080 hours.

The mean loaded annual wage is used to estimate the minimum cost of employing 10 full

- time employees for one year

— termed the reven ue floor

— representing the minimum revenue a parent entity must have in order to potentially report to TRI ( i.e. , if the parent entity does not have revenues equal to the cost of employing 10 full

- time employees, no facility owned by that parent entity is likely to be affected by the proposed rule)

. The revenue floor is used to exclude facilities that are not expected to be subject to TRI reporting requirements from the small entity analysis, thereby providing a more accurate estimate of small entity impacts. The method used to calculate the revenue floor provides a conservative estimate of this threshold: the revenue floor is equal to the cost of employing 10 full

- time employees, impl ying the parent entity only earns enough r evenue to cover its labor costs

. The mean annual wage is also multiplied by the employment

- based Small Business Administration size
standard to estimate the revenue corresponding to the small entity size standard for the sector , termed the small entity rev enue threshold

. The estimation of the small entity revenue threshold may understate the number of small entities, as a firm may have fewer employees than the SBA size standard yet earn more than the small entity revenue threshold . However, this methodology still provides a conservative estimate of overall small entity impacts for two reasons. First, while the number of small entities may be understated, any additional small entities would incur impacts of less than 1%; the number of small entities incurring impacts of greater than 1% would remain the same regardless of the small entity
threshold selected. 17 Second, when determining whether there is a significant impact on a substantial number of small entities, the number and percent of small entities incurri ng impacts of greater than 1% is the critical factor, rather than the number of small entities incurring impacts of less than 1%. If the number of small entities incurring impacts of less than 1% were to increase (under an alternative small entity revenue threshold), the percent of small entities incurring impacts of greater than 1% would
therefore decrease . In other words, any understatement of the number of small entities incurring less than 1% impacts increases the proportion of small entities incurring impacts of greater than 1%, potentially making a certification of no significant impact to a substantial number of small entities more difficult, and thereby providing a conservative estimate of overall impacts to small entities.

17 If the small entity revenue th reshold were to change, the proportion of the affected universe estimated to be small entities incurring impacts of <1% or large entities would shift; however, the proportion of the affected universe to be small entities incurring impacts of 1% to 3% or >3 % remains the same, as those thresholds would not change.

### SMALL ENTITY ANALYSIS

Economic Analysis of Proposed Addition of HBCD ▌ pg. 4

- 9 Overall, the methodology employed to estimate the reporting threshold and the small entity threshold are estimated to result in a generally conservative estimate of impacts to small entities.

The mean loaded annual wage, revenue floor , small entity size standard, and small entity thresholds are displayed in Table 4

- 5 below

.

Table 4

- 5 : Key Revenue Thresholds

Sector Mea n Loaded

Annual Wage (201 3 Dollars) Revenue Floor Small Business Administration Size Standard Small Entity Revenue Threshold HBCD Manufacturing (NAICS 325) $68, 725 $68 7,249 500 employees $34, 362, 430

Motor Vehicle Seating and Trim Manufacturing (NAICS 336360) $52, 760 $52 7,604 500 employees $26, 380,22 5

HIPS Manufacturing (NAICS 325211) $69, 139 $69 1,386 750 employees $51, 853,93 5

Estimation of Number of Facilities per Parent Entity and Number of Parent Entities Using the small entity revenue threshold from Table 4

- 5 above , each SUSB enterprise revenue categ ory can be classified as small or large (if the lower bound of the enterprise revenue category is greater than the small entity revenue threshold, the category is large; otherwise it is considered small). For each
revenue category determined to be small, t he number s of establishments and firms are used to determine the overall average number of establishments per firm for small entities. This calculation is summarized
in Equation 4

- 2

.
Equation 4

- 2 : Calculation of Average Number of Facilities per Parent Entity

Average Number of Facilities

per Parent Entity = ∑ ( Establis h ment i ) i ∑ ( Firm i ) i

Where i indexes the SUSB enterprise revenue categor ie s identified as small

.
The number of facilities expected to report (as estimated in Chapter 2 ) is then divided by the average number of facilities per parent entity to calculate the number of parent entities expected to report. Table
4

- 6 presents the estimated number of parent entities expected to report in each sector.

### SMALL ENTITY ANALYSIS

Economic Analysis of Proposed Addition of HBCD ▌ pg. 4

- 10 Table 4

- 6 : Average Number of Facilities per Parent Entity and Estimated Number of
Parent Entities

Sector Average Number of Facilities per Parent Entity Number of Facilities

Expected to Report Estimated Number of Parent Entities Expected to Report HBCD Manufacturing (NAICS 325) 1.37 3 2

Motor Vehicle Seating and Trim Manufacturing (NAICS 336360) 1.37 10 7

HIPS Manufacturing (NAICS 325211) 1.42 15 11

Estimation of Annualized Parent Entity Compliance Costs and Impact Thresholds Annualized parent entity compliance costs are estimated by multiplying the annualized cost of submitting

one Form R 18 ($2, 01 6 ) by the average number of facilities per parent entity

. The parent entity revenue corresponding to a 1% impact and a 3% impact

— i.e. , the parent entity revenue at which cost impacts of
1% or 3% are incurred

— is calculated by dividing the annualized compliance cost by 1% or 3%, respectively. These revenues are displayed in Table 4

- 7

.

Table 4

- 7 : Annualized Parent Entity Cost Impacts

Sector Average

Number of Facilities per Parent Entity 1 Annualized

Parent Entity Compliance Cos t Revenue at which

a 1% Impact is Incurred (Annualized Compliance Cost / 1%) Revenue at which

a 3% Impact is Incurred (Annualized Compliance Cost / 3%) HBCD Manufacturing (NAICS 325) 1.37 $2,763 $276,326 $92,109

Motor Vehicle Seating and
Trim Manufacturing (NAICS 336360) 1.37 $2,672 $276,249 $92,083

HIPS Manufacturing (NAICS 325211) 1.42 $2,871 $287,109 $95,703

1 Average number of facilities per parent entity has been rounded for ease of presentation

.

Construction of Revenue Percentiles of Parent Entities Under the assumption that an enterprise is equivalent to an ultimate parent entity and that revenues within each census revenue size category are uniformly distributed, parent entity revenue percentiles can be constructed using SUSB data ta bulated by enterprise revenue size. Revenue distributions for each integer percentile are calculated by assuming that revenues are distributed uniformly within each SUSB revenue

18 The cost of submitting a Form R annualized at a 7% discount rate is used as it provides a more conservative
estimate of costs.

### SMALL ENTITY ANALYSIS

Economic Analysis of Proposed Addition of HBCD ▌ pg. 4

- 11 category. Note that the overall distribution of revenues across the industry s ector takes the distribution of enterprises across all revenue categories into account: though revenues are distributed uniformly within each revenue size category , each revenue size category reflects a different proportion of the overall sector depending on the number of enterprises contained in the revenue category. The resulting revenue
distribution is summarized in Table 4

- 8 below (for presentational simplicity, every fifth percentile is displayed).

Table 4

- 8 : Parent Entity Revenue Percentiles

Perce ntile HBCD Manufacturing Motor Vehicle Seating and Trim Manufacturing HIPS Manufacturing

1 $13,217 $16,521 $23,129

5 $61,677 $79,299 $114,545

10 $154,195 $497,828 $721,411

15 $396,500 $770,974 $1,029,801

20 $644,314 $1,002,266 $1,679,623

25 $908,648 $1,349,205 $2,406,541

30 $1,217,038 $1,795,269 $3,194,037

35 $1,663,102 $2,224,811 $3,992,546

40 $2,125,686 $2,654,354 $4,791,055

45 $2,571,750 $3,331,711 $5,617,100

50 $3,304,176 $4,130,220 $7,021,374

55 $4,267,894 $4,928,729 $8,563,323

60 $5,231,611 $6,415,609 $12,115,313

65 $6,801,096 $11,674,756 $18,007,761

70 $8,921,276 $20,651,101 $29,572,377

75 $12,996,426 $34,473,572 $53,417,516

80 $20,210,544 $75,445,358 $110,139,210

85 $36,290,869 $110,139,210 $110,139,210

90 $89,212,760 $110,139,210 $110,139,210

95 $110,139,210 $110,139,210 $110,139,210

100 $110,139,210 $110,139,210 $110,139,210

Note: The largest SUSB enterprise revenue category does not have an upper bound ($100,000,000 and greater). All revenue percentiles corresponding to this largest category are therefore based on the lower bound of the category ($100,000,000) and are equal. However, as none of these entities are small, the distribution of parent entity revenues in this range is not rele vant to the analys is.

Using th e distribution of parent entity revenues, the revenue floor, 1%, 3%, and small entity thresholds can be identified. The percentiles corresponding to these thresholds are displayed in Table 4

- 9 below

.

### SMALL ENTITY ANALYSIS

Economic Analysis of Proposed Addition of HBCD ▌ pg. 4

- 12 Table 4

- 9 : Revenue Percentiles Corresponding to Key Thresholds

Sector Below Revenue Floor 3 % Impact

Threshold 1 % Impact

Threshold Small Entity

Revenue
Threshold
HBCD Manufacturing (NAICS 325) 21 8 13 85

Motor Vehicle Seating and Trim Manufacturing (NAICS 336360) 11 6 8 73

HIPS Manufacturing (NAICS 325211) 10 4 6 75

In all three sectors, the revenue floor is higher than both the 1% and 3% impact thresholds, indicating that any parent entity affected by the proposed rule has revenues large enough to incur impacts of <1%. For example, in the HBCD manufacturing sector, the revenue floor is equivalent to the 21st percentile, while the 3% and 1% impacts occur at the 8th and 13th percentiles, respectively. Small entity impacts are incurred over 64 revenue percentiles (from the 21st percentile to the 84th percentile, as the 20th and lower percentiles are below the revenue floor, and the 85th and higher percentiles are classified as large parent entities). All of the small parent entity impacts are estimated to be less than 1%, as the 1% impact
threshold is lower than the revenue floor.

The percent of parent entities in each impact category can be calculated using the revenue percentiles in
Table 4

- 9

. For example, 79% of the parent entities in the HBCD manufacturing sector are estimated to be potentially affected by TRI reporting requirements ( i.e. , 21% of the entities have revenues less than the revenue floor [the cost of employing 10 full

- time employees]; the rem aining 79% are potential reporters). Of these enterprises, 81% are estimated to be small entities, all of which are estimated to incur impacts of
<1%. 19 The percent of parent entities in each impact category is presented in Table 4

- 10 below

.

Table 4

- 10 : Percent o f Parent Entities in E ach Impact Category

Sector Small Entities Incurring Impacts of <1% Small Entities

Incurring Impacts of 1% to 3% Small Entities

Incurring Impacts of >3% HBCD Manufacturing (NAICS 325) 100 % 0% 0%
Motor Vehicle Seating and Trim Manufacturing (NAICS 336360) 10 0% 0% 0%

HIPS Manufacturing (NAICS 325211) 100 % 0% 0%

19 Of all parent entities, 21% do not report, and 15% are not small (1 00 percentiles

– 85 percentiles). However, of the parent entities expected to potentially report to TRI , 15 percentiles / 79 percentiles = 19% are not small, and the remaining 81% are small. As both the 1% and 3% impact thresholds are less than the revenue floor, all small entities are estimated to incur impacts of <1%.

### SMALL ENTITY ANALYSIS

Economic Analysis of Proposed Addition of HBCD ▌ pg. 4

- 13 Estimation of Annualized Cost Impacts to Small Parent Entities To estimate the number of small parent entities in each impact category, the estimated number of parent
entities from Table 4

- 6 is distributed across the percent of potentially affected parent entities in each impact category from Table 4

- 10

. The estimated number of small parent entities is presented in Table
4

- 11

.

Table 4

- 11 : Estimated Small Parent Entities

Sector Estimated Parent Entities Percent of Parent

Entities that are Estimated to be Small Estimated Small Parent Entities

HBCD Manufacturing (NAICS 325) 2 81% 2 1

Motor Vehicle Seating and Trim Manufacturing (NAICS 336360) 7 70 % 5

HIPS Manufacturing (NAICS 325211) 11 72% 8

1 Rounded up to provide a conservative estimate of the number of small parent entities.

Annualized cost impacts to small parent entities are presented in Table 4

- 12

.

Table 4

- 12 : Annualized Cost I mpacts to Small Parent Entities

Sector Small Parent Entities Incurring Impacts of <1% Small Parent Entities Incurring Impacts of 1% to 3% Small Parent

Entities Incurring Impacts of >3% Total Small

Parent Entities

HBCD Manufacturing (NAICS 325) 2 (100%) 0

(0%) 0

(0%) 2

Motor Vehicle Seating and Trim Manufacturing (NAICS 336360) 5 (100%) 0

(0%) 0

(0%) 5

HIPS Manufacturing (NAICS 325211) 8 (100%) 0

(0%) 0

(0%) 8

Note: The percent figures denote the percent of small parent entities in each impact category.



### 4.4 Summary of Impacts to Small Parent Entities

The 101 facilities expected to report were linked to 55 parent entities, 42 of which were categorized as small entities. All of the small parent entities affected by the proposed rule are estimated to incur annualized cost impacts of less than 1%. Table 4

- 13 summarizes the results of the small entity analysis.

### SMALL ENTITY ANALYSIS

Economic Analysis of Proposed Addition of HBCD ▌ pg. 4

- 14 Table 4

- 13 : Summary of Small Entity Analysis

Sector Small Parent

Entities Incurring Impacts of <1% Small Parent Entities

Incurring Impacts of 1% to 3% Small Parent

Entities Incurring Impacts of >3%
HBCD Manufacturing (NAICS 325) 2 (100%) 0 0

EPS Resin Manufacturing (NAICS 325211) 0 0 0

XPS and EPS Foam Manufacturing b (NAICS 326140) 26 (100%) 0 0

Automotive Textile Manufacturing (Misc. NAICS Codes) 1 (100%) 0 0

Motor Vehicle Seating and Trim Manufacturing (NAICS 336360) 5 (100%) 0 0

HIPS Manufacturing (NAICS 325211) 8 (100%) 0 0

Total 42 (100%) 0 0

As all small entities are estimated to incur impacts of less than 1%, the proposed rule is not expected to significantly impact a substantial number of small entities.

### BENEFITS

Economic Analysis of Proposed Addition of HBCD ▌ pg. 5

- 1 

## 5. Benefits

In enacting the Emergency Planning and Community Right

- to

- Know Act (EPCRA) of 1986 and the Pollution Prevention Act (PPA) of 1990, Congress recognized the significant benefits of providing information on the presence, releases and waste management of toxic chemicals. The Toxics Release Inventory (TRI) has proven to be one of the most powerful forces in empowering the federal government, state and local governments, industry, environmental groups, and the general public to fully participate in
an informed di alogue about the environmental impacts of toxic chemicals in the United States. The TRI database provides several types of information, including quantitative information on toxic chemical releases and other waste management practices. Starting in 1987, th e collection of this information enhanced the ability for the public, government, and the regulated community to understand the breadth and magnitude of chemical releases in the United States, and to assess the need to reduce the releases and
transfers of toxic chemicals. TRI data enable all interested parties to establish credible baselines, to set realistic goals for environmental progress, and to measure progress in meeting these goals over time. As such, the TRI Program has become a yardstick by which p rogress can be measured by all interested or
affected stakeholders.

The information reported to TRI increases community knowledge and awareness of quantities of toxic chemicals released to the environment, and potential pathways of exposure to those chemi cals. This knowledge:

 Improves scientific understanding of the health and environmental risks of toxic chemicals;

 Allows the public to make informed decisions on where to work and live;

 Enhances the ability of corporate leaders and purchasers to more acc urately gauge a facility’s potential environmental liabilities;

 Provides reporting facilities with information that can be used to save money as well as reduce emissions; and,

 Assists federal, state, and local authorities in making better decisions on acc eptable levels of toxic
chemicals in the environment.

The benefits of the proposed rule include improved understanding, awareness, and decision making related to the provision and distribution of information on releases and waste management of HBCD . This provision of information can lead to follow

- on activities that create additional costs and benefits. In particular, voluntary initiatives by industry to review production processes, set goals for reductions in emissions, and institute “good neighbor ” policies may result from information provision. If an individual facility owner or operator perceives that the additional information generated to comply with the section 313 reporting requirements provides them with valuable information about their oper ations and how they might be modified, then changes may be implemented to reduce releases of TRI chemicals.

Making TRI information available to the public may provide incentives for facilities to reduce TRI chemical releases. For example, the public avail ability of release information may induce facilities to reduce releases when such changes would not be in the facility’s interest if release information were not in the public domain. Potential social benefits derived from voluntary follow

- on activities in clude decreased costs of waste treatment and disposal, lower probability of accidental releases and lower clean

-

### BENEFITS

Economic Analysis of Proposed Addition of HBCD ▌ pg. 5

- 2 up costs in the event of such releases, reduced contamination of natural resources, improved air and water quality, and reduced risks to human h ealth. Such social benefits are partially offset by the social costs to implement the changes, such as installing scrubbers and substituting materials that are less toxic but more expensive. The net social benefits of the information provided by the propos ed rule and the possible
follow

- on activities equal the difference between the total benefits and the total costs of the activities leading to reduced releases.

The potential benefits of additional TRI reporting can be understood by examining the ways in w hich different groups of affected stakeholders

— consumers, industry, governments and the general public

—use TRI data. Consumers may use the data to make more informed decisions about the products they buy and to enter into constructive dialogue with firms i n their communities that release HBCD . Facilities may find opportunities for waste reduction and cost savings through the process of obtaining reporting data. Non

federal governments may use the data in lieu of, or in support of, their own environmental pr otection
activities. Non

- users of the TRI data benefit from its public provision whenever others’ use of the data results in improvements in environmental quality.

Some examples of the ways in which various stakeholders have utilized TRI data include:

 Use of the Data by Community and Public Interest Groups: Communities use TRI data to begin dialogues with local facilities and to encourage them to reduce their emissions, develop pollution prevention plans, and improve safety measures. Public interest groups use the data to educate the public about toxic chemical emissions and potential risk, and in environmental justice activities.

 Use of the Data by Education and Research Institutions: TRI data are being used in many environmental education programs, partic ularly at the high school and university levels. Students learn about toxic chemical releases, the potential health and environmental effects of those releases, pollution prevention activities and opportunities, and the social and political aspects of
envi ronmental protection. Some organizations also are conducting educational outreach programs using TRI data.

 Use of the Data by the Financial and Business Communities: Investment analysts use TRI data to provide recommendations to clients seeking to make en vironmentally sound investments. Insurance companies look to TRI data as one indication of potential environmental liabilities. Consultants and others use the data to identify business opportunities, such as marketing pollution prevention and control techn ologies to TRI reporting facilities. Demand for environmental performance information by investors, insurance companies, and the public has led many companies to develop environmental annual reports similar to annual reports on financial performance tradit ionally prepared for investors.

 Industry Use of TRI Data: TRI data have been used by industry for activities such as developing waste reduction strategies and improving companies’ understanding of their own production processes. Industry also uses TRI subm ission information to show environmental progress and as a starting point for engaging with communities.

 Government Use of TRI Data: Government organizations such as the media

- specific and core offices at EPA, EPA Regional offices, and other national, sta te, and local government agencies routinely use TRI data. TRI data have been used to: develop inspection targeting and enforcement tools; analyze and prioritize long

- term trends in waste minimization; identify candidates for the

### BENEFITS

Economic Analysis of Proposed Addition of HBCD ▌ pg. 5

- 3 National Primary Drinking W ater Regulations; coordinate environmental data internationally through agreements and organizations such as the Commission for Environmental Cooperation; and set priorities and allocate increasingly scarce environmental protection resources to the most

pr essing problems.

EPA has not attempted to monetize the benefits of the proposed rule due to the lack of quantitative information characterizing the range of users and non

- users of TRI data and the substantial analytical challenges associated with accuratel y predicting behavioral responses to the provision of information ( Palm, 1981 ; Moody et al., 1999 )

. The analysis was not able to consider variations in quality or other attributes of TRI data access methods. The potentially large numbers of beneficiaries who are not users or
who are otherwise unaware of the data ( e.g. , the general public) further limits EPA’s ability to quantify potential benefits.

The experience since the first forms were submitted to TRI in 1987 suggests that reporting under EPCRA section 313 has produced real gains in unders tanding communities’ exposure to toxic chemicals. In its
report The Toxics Release Inventory in Action: Media, Government, Business, Community and Academic Uses of TRI

, EPA has documented numerous examples of how multiple stakeholders have used TRI data ( U.S. EPA, 2013b )

. Moreover, a cursory search on GoogleScholarTM reveals thousands of academic articles referencing the Toxics Release Inventory. Listing HBCD, and the subsequent use of the reported information, should provide similar gains in underst anding of this particular chemical. EPA believes that
HBCD meets the statutory toxicity criteria of section 313, and is at least as toxic as some of the chemicals for which Congress initially believed there were net benefits due to reporting (i.e., the ini tial list of section 313 chemicals)

.

### REFERENCES

Economic Analysis of Proposed Addition of HBCD ▌ pg. 6

- 1 

## 6. References

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