MEMORANDUM 

DATE: October 28, 2010 

SUBJECT: Affordability of Lower VHAP Coatings and Add-on Controls for Wood 

Furniture Manufacturing Operations 

FROM: Kaye Whitfield 

TO: Docket No: EPA-HQ-OAR-2010-0786 

Section 112(f)(2) of the Clean Air Act (CAA) directs EPA to assess the risk remaining (residual 

risk) after the application of maximum achievable control technology (MACT) standards under 

section 112(d). EPA is to promulgate more stringent standards for a category or subcategory of 

sources subject to MACT standards under section 112(d) if promulgation of such standards is 

necessary to protect public health with an ample margin of safety or to prevent (taking into 

consideration various factors) adverse environmental effects. 

In an effort to streamline the process of making residual risk decisions, EPA plans to address 

residual risk and perform a technology review simultaneously for the wood furniture 

manufacturing source category. The first part of this approach is to compile and review (and 

update with facility-specific data collected by EPA in some cases) readily available source 

category emissions data from the 2005 National Emissions Inventory (NEI) and to conduct 

preliminary risk assessments. 

The second part of this approach is to reduce any remaining “residual” risk according to CAA 

section 112(f). Section 112(f)(2) of the CAA then directs EPA to assess the risk remaining 

(residual risk) after the application of the MACT standards and promulgate more stringent 

standards for a category or subcategory of sources subject to MACT standards if promulgation of 

such standards is necessary to protect public health with an ample margin of safety or to prevent 

(taking into consideration various factors) adverse environmental effects. 

Two control options were evaluated. The first was the use of a regenerative thermal oxidizer 

(RTO) system to control emissions from the wood furniture coating booth. The second was the 

1 
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use of lower VOC coatings in wood furniture manufacturing operations. The purpose of this 

memo is to document the affordability of the control options evaluated for this source category.1

 

For the purpose of this analysis, the cost of the control option as a percentage of revenues was 

used as a rough indicator of affordability. Six wood furniture manufacturing facilities were 

chosen for the affordability analysis. A mixture of wood furniture facilities was selected—three 

cabinet facilities, two home furnishing facilities, and one office furniture facility. 

The list was used to investigate reported revenues in the Hoovers Database2. All six facilities 

were located in the Database, which lists reported revenues by parent company, and sometimes 

by individual facility locations. 

The database contained facility specific revenues for four of the wood furniture facilities. Using 

the annualized cost of the RTO option ($2.57 million), the affordability for these four facilities 

was greater than 329 percent of the facility revenues. 

For the remaining two facilities, assumptions were made about the parent company sales in 

relation to specific facilities. Due to the predominance of wood furniture manufacturing 

operations for these two companies, we assumed that 100% of the parent company revenues for 

American Woodmark and Thomasville Furniture were related to wood furniture manufacturing. 

Then, we gathered information on the number of facilities owned by each of the parent 

companies. According to American Woodmark’s website3

, the company owns 29 locations in 

the United States. According to the Hoovers Database, Thomasville Furniture owns 15 facilities 

in the United States. By dividing the total revenues by the number of facilities, we calculated a 

revenues-per-facility estimate for each parent company. The affordability of using an RTO at 

each facility was calculated by dividing the cost of the RTO by the revenues at each location. 

The results were 18% and 63% for American Woodmark and Thomasville Furniture, 

respectively. Due to the large disparity between the affordability calculation using parent 

company revenues and facility specific revenues, we believe the facility-specific affordability 

calculations are more representative. 

These analyses indicate a definite problem with affordability for the RTO control option. The 

results are shown in Table 1. 

1 Cost Analyses for Control Options. Memorandum dated September 27, 2010. 

2

 Business Solutions from Hoovers. http://www.hoovers.com/. Accessed October 28, 2010. 

3

American Woodmark Corporation. http://www.americanwoodmark.com/about.asp?iAreaID=1&iSectionID=4. 

Accessed October 28, 2010. 
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Similar calculations were performed for the option of using lower VHAP coatings. The only 

change to the analysis is the annualized cost of coatings is approximately $7,000 while the 

annualized cost of the RTO option is $2.57 million. 

The results of the second evaluation indicate that there may be a problem with affordability for 

the lower VHAP coating option. The affordability ranges from 0.9% to 6% of the facility 

specific revenues. The numbers are shown in Table 2. 

Screenshots of the results from Hoovers.com are shown in Attachments 1 through 6.
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Table 1. RTO Control Affordability Screening 

Wood Furniture City

Stat

e

Company

Sales

Wood Furniture

Sales (millions)

Number of

facilities

Wood Furniture

Sales per facility

(million)

Cost of 

Fac

(mill

Steelcase, Inc.

Kentwood MI $2,291.70 ‐‐‐‐  ‐‐‐‐  $0.16 

American Woodmark Kingman AZ $406.54 $406.54 29 $14.02 La‐Z‐Boy Redlands CA $1,179.21 ‐‐‐‐  ‐‐‐‐  $0.18 McConnell Cabinets,Inc. El Monte CA ‐‐‐‐  ‐‐‐‐  ‐‐‐‐  $0.78 Bertch Cabinets Waterloo IA ‐‐‐‐  ‐‐‐‐  ‐‐‐‐  $0.11 Thomasville Furniture Lenoir NC $61.32 $61.32 15 $4.09 Table 2. Lower VHAP Coatings Affordability Screening 

Wood Furniture City State

Company

Sales

Wood Furniture

Sales (millions)

Number of

facilities

Wood Furniture Sales

per facility (million)

Cost per 

(millio

Steelcase, Inc. Kentwood MI $2,291.70 ‐‐‐‐  ‐‐‐‐  $0.16 American Woodmark Kingman AZ $406.54 $406.54 29 $14.02 La‐Z‐Boy Redlands CA $1,179.21 ‐‐‐‐  ‐‐‐‐  $0.18 McConnell Cabinets, Inc. El Monte CA ‐‐‐‐  ‐‐‐‐  ‐‐‐‐  $0.78 Bertch Cabinets Waterloo IA ‐‐‐‐  ‐‐‐‐  ‐‐‐‐  $0.11 Thomasville Furniture Lenoir NC $61.32 $61.32 15 $4.09 
Attachment 1. Steelcase Inc. Company Results from Hoovers.com 

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Attachment 2. American Woodmark Company Results from Hoovers.com 

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Attachment 3. La-Z-Boy Company Results from Hoovers.com 

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Attachment 4. McConnell Cabinets Company Results from Hoovers.com 

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Attachment 5. Bertch Cabinets Company Results from Hoovers.com 

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Attachment 6. Thomasville Furniture Company Results from Hoovers.com 

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