p.1 

OAR Box 1477 

Prepped by Ollie Stewart 

Document Number: 

22) II-J-13 

Docket Number: 

A-94-52 

Printed 7/31/2008 11:18:29 AM Sheet 22 of 36 
P.2 

tr- T- 3 

From: Kelly DeBusk <sailer@naxs.com> 

To: KEITH BARNETT <BARNETT.KEITH@epamail.epa.gov> 

Date: 1/9/00 3:15pm 

Subject: Small Business Outreach Meeting 

CC: Austin Perez <Austin.Perez@sba.gov> 
P.3 

» 

< 

December 29, 1999 

To: Keith Barnett 

Environmental Engineer 

Organic Chemicals Group (MD-13) 

Research Triangle Park, NC 27711 

From: Allen DeBusk 

General manager 

Appalachian Plastics, Inc. 

34001 Glove Drive 

PO Box 1044 

Glade Spring, Va. 24340 

Subject: Response from Small Business Outreach Meeting 

Dear Keith, 

There were several issues brought up in the Small Business Outreach Meeting on December 14, 1999 that 

we feel would have a significant impact on the existence of manufacturers the size of Appalachian Plastics, 

Inc. I have included some potentially disastrous scenarios that would have a significant economic impact 

on existing businesses. I know that you are supposed to consider technical reasons rather than economic 

ones, however, there is a point where economic consideration becomes a technical matter. 

Appalachian Plastics, Inc. is in an aggressive growth transition. This requires us to carry a lot of debt. We 

anticipate having to borrow more money as we attempt to expand capacity. If our growth triggers New 

Source MACT, then I am afraid we will not be able to afford to grow. Ifthe floors are set as you have 

proposed, then there is an extreme possibility that we would have to close our doors. We could not afford 

interruptions in production and still meet our existing financial obligations to the bank. I have included a 

brief table ofthe company's finances for the past eight years. As you can see there is not a lot of extra 

money for controls or the operation of controls. We are in the process of getting an estimate on the capitol 

and operational costs of controls, and I will forward that information to you as soon as possible. 

You are already aware ofthe unique product we make that requires the use ofa sixty-percent HAP resin. 

The proposed standard will not allow Appalachian Plastics to produce this product under certain 

circumstances. We have invested our whole future in this product and the current demand is higher than 

anticipated aheady. We need a provision that will allow us to continue to manufacture this product. 

The actual financial reports for the past eight years can be made available if you would like to see them. 

Thank you for your consideration. 

Sincerely, 

Allen DeBusk 
P.4 

I. Point Value Feasibility 

A. NSF 

1) The non-fire retardant vinylester resins (Hetron 922 and Derakane 411) are used to manufacture 

water treatment equipment. This equipment is required to have an NSF (National Sanitation 

Foundation) listing. We have recently discovered it is likely that NSF will not approve the lower 

HAP resins. We have initiated the process of getting it approved, but this process will take eight 

to nine months. If we are unable to switch this resin to the low HAP resin, we would likely be 

out of compliance by the year 2002. 

B. Class I Flame and Smoke Rated Ducting 

1) Appalachian Plastics, Inc. spent ten years and over $100,000.00 developing this product. We 

have committed our future growth to the market for this product. This product utilizes a 

resin that has a 60% HAP content. It cannot be modified and still achieve the properties of 

a Class I Flame and Smoke composite. It is the only non-phenolic composite that has obtained a 

Class I rating. It is suitable for many environments where phenolics are not. 

C. Coal Strike 

1) We have ran the point value calculations for the last two years. On the surface it would appear 

that the point system works very favorably for our company. This is because we process a 

significant volume of 29% HAP resin. Unfortunately, 100 percent ofthis resin is used to 

manufacture ventilation for the coal mines. We have not found another product that can be 

manufactured satisfactorily with this resin. In the event ofa strike in the coal fields our 

processes become immediately out of compliance. The current contract between the Coal 

Operators and the United Mine Workers Union expires in 2002. 

2) Although our total emissions would be drastically reduced, our rate of emissions would force us 

to close our doors. We were nearly bankrupt by an eleven month coal strike in the early 

seventies. That is when we made the decision to pursue other markets. We no longer wanted to 

be entirely dependent on the unstable coal industry. Even though we have established other 

markets to keep us going in the event ofa coal strike, this standard would prevent us from 

serving our other markets. This standard makes us totally reliant on the coal industry once 

again. 

3) For an example; We have taken our actual total processing for the month of November and ran 

them through the point calculations (Maximum Point Value 171.6) (Calculated Point Value 

160.26) and then ran the same numbers as if the mines had been on strike. (Maximum Point 

Value 170.08) (Calculated Point Value 180.51) This would be the results, only if we processed 

the same amount of non-mine related product. In reality, we would have processed much more 

ofthe non-mine related product due to the window in production caused by the strike. The 

increase in other production would put us even farther out of compliance. 

4) The above scenarios are examples ofthe detrimental short term effects this standard would have 

on us. The long term effects are just as detrimental if not more so. The coal related market is a 

declining market. As new technologies are developed and coal resources are depleted, the 

demand for our type of ventilation declines every year. In five years, with just the projected 

increase in our Class I business and our projected decrease in our mine related business, we 

would be out of compliance after having used all ofthe feasible reduction methods made 

available to us. 
P.5 

5) Possible Solutions 

a). Point Banking 

1. Would it be feasible to accumulate points? For example: If a facility operates for 12 

months at 10 points under the floor, could it then operate 12 months at 10 points over 

the floor? This would enable a company to accept a high volume contract without 

having to stop ifthe floor was about to be exceeded. (The Semi-conductor and Paper 

Mill industries typically order large quantities of product in short time frames 

generally requiring high HAP resins.) 

b). Above the Floor Window 

1) Some facilities could possibly be operating right at the floor and then have an 

interruption in the market place or production that would cause them to go over the 

floor. Could there possibly be a window that would allow facilities to operate above 

the floor for a period of time due to these types of interruptions? Such a window 

could prevent a facility from having to abruptly stop operations. 

c). Gel Coating 

1) The proposed floor for gel coating does not seem achievable under any 

circumstances. The best ofthe best is apparently a tub and shower facility, building 

product that is never exposed to ultra violet degradation with a special blended gel 

coat that is tailor made for their process. Appalachian Plastics manufactures gelcoated water playground equipment that is constantly exposed to high levels of ultra 

violet light. We pay at least 90 cents a pound more for a high HAP gel coat because 

of its superior ultra violet properties. Is it possible to create sub-categories for indoor 

and outdoor gel coat service? 

II. Economic Feasibility to Installing Capture and Control 

A. Current Debt 

1) Mortgage: $653,000 

2) Operating: $115,350 

3) Parking Lot: $125.000 

4) Total Debt: $893,350 

Profit And Loss 

1) Sales: 

2) Cost of Sales: 

3) Operating Expenses: 

4) Interest Gain/Loss: 

5) Profit Before Taxes: 

6) Less Taxes: 

7) Net profit: 

1991-92 

$ 1,259,980.00 

$ 891,837.00 

$ 329,693.00 

$ 2.712.00 

$ 35,738.00 

$ 1.212.00 

$ 34,526.00 

$ 

$ 

$ 

$ 

$ 

? 

$ 

1992-93 

1,466,589.00 

927,428.00 

421,236.00 

(1.231.00) 

119,156.00 

32.307.00 

86,849.00 

$ 

$ 

$ 

? 

$ 

$ 

$ 

1993-94 

1,995,524.00 

1,438,282.00 

405,976.00 

1.451.00 

149,815.00 

45.331.00 

104,484.00 

$ 

$ 

$ 

$ 

$ 

$ 

$ 

1994-95 

2,304,634.00 

1,632,429.00 

484,546.00 

2.319.00 

185,340.00 

68.058.00 

117,282.00 
P.6 

Profit And Loss 

1) Sales: 

2) Cost of Sales: 

3) Operating Expenses: 

4) Interest Gain/Loss: 

5) Profit Before Taxes: 

6) Less Taxes: 

7) Net profit: 

$ 

$ 

$ 

$ 

$ 

$ 

$ 

1995-96 

2,305,499.00 

1,804,990.00 

519,008.00 

2.295.00 

(20,794.00) 

(1.981.00) 

(18,813.00) 

$ 

$ 

$ 

$ 

$ 

$ 

1996-97 

2,524,357.00 

1,669,300.00 

767,902.00 

14.501.00 

72,654.00 

21.165.00 

51,489.00 

$ 

$ 

$ 

? 

$ 

$ 

$ 

1997-98 

2,778,954.00 

2,044,038.00 

763,263.00 

10.783.00 

(39,130.00) 

(5.344.00) 

(33,786.00) 

$ 

$ 

$ 

$ 

$ 

$ 

$ 

1998-99 

4,049,038.00 

2,962,279.00 

966,967.00 

39.797.00 

79,995.00 

24.226.00 

55,769.00 

D. Estimated Cost of Capture and Control: 

1) Capitol Investment: $?,???,??? 

2) Annual Debt Service: $???,??? 15 Years 

3) Annual Operating Cost: $???,??? 

4) Total Annual Cost: $???,???