```

[Senate Report 111-370]
[From the U.S. Government Publishing Office]

                                                       Calendar No. 700
111th Congress
                                 SENATE
                                                                 Report
 2d Session                                                     111-370

======================================================================

   CONTINUING CHEMICAL FACILITIES ANTITERRORISM SECURITY ACT OF 2010

                               __________

                              R E P O R T

                                 of the

                   COMMITTEE ON HOMELAND SECURITY AND

                          GOVERNMENTAL AFFAIRS

                          UNITED STATES SENATE

                              to accompany

                               H.R. 2868

  TO AMEND THE HOMELAND SECURITY ACT OF 2002 TO ENHANCE SECURITY AND 
PROTECT AGAINST ACTS OF TERRORISM AGAINST CHEMICAL FACILITIES, TO AMEND 
  THE SAFE DRINKING WATER ACT TO ENHANCE THE SECURITY OF PUBLIC WATER 
   SYSTEMS, AND TO AMEND THE FEDERAL WATER POLLUTION CONTROL ACT TO 
   ENHANCE THE SECURITY OF WASTEWATER TREATMENT WORKS, AND FOR OTHER 
                                PURPOSES

               December 16, 2010.--Ordered to be printed

        COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS

               JOSEPH I. LIEBERMAN, Connecticut, Chairman
CARL LEVIN, Michigan                 SUSAN M. COLLINS, Maine
DANIEL K. AKAKA, Hawaii              TOM COBURN, Oklahoma
THOMAS R. CARPER, Delaware           SCOTT P. BROWN, Massachusetts
MARK L. PRYOR, Arkansas              JOHN McCAIN, Arizona
MARY L. LANDRIEU, Louisiana          GEORGE V. VOINOVICH, Ohio
CLAIRE McCASKILL, Missouri           JOHN ENSIGN, Nevada
JON TESTER, Montana                  LINDSEY GRAHAM, South Carolina
CHRISTOPHER A. COONS, Delaware       MARK KIRK, Illinois

                  Michael L. Alexander, Staff Director
                     Kevin J. Landy, Chief Counsel
                       Holly A. Idelson, Counsel
     Brandon L. Milhorn, Minority Staff Director and Chief Counsel
   Robert L. Strayer, Minority Director for Homeland Security Affairs
          Devin F. O'Brien, Minority Professional Staff Member
                  Trina Driessnack Tyrer, Chief Clerk

                                                       Calendar No. 700
111th Congress
                                 SENATE
                                                                 Report
 2d Session                                                     111-370

======================================================================

 
   CONTINUING CHEMICAL FACILITIES ANTITERRORISM SECURITY ACT OF 2010

                                _______
                                

               December 16, 2010.--Ordered to be printed

                                _______
                                

Mr. Lieberman, from the Committee on Homeland Security and Governmental 
                    Affairs, submitted the following

                              R E P O R T

                        [To accompany H.R. 2868]

    The Committee on Homeland Security and Governmental 
Affairs, to which was referred the bill (H.R. 2868) to amend 
the Homeland Security Act of 2002 to enhance security and 
protect against acts of terrorism against chemical facilities, 
to amend the Safe Drinking Water Act to enhance the security of 
public water systems, and to amend the Federal Water Pollution 
Control Act to enhance the security of wastewater treatment 
works, and for other purposes, having considered the same, 
reports favorably thereon with an amendment and recommends that 
the bill do pass.

                                CONTENTS

                                                                   Page
  I. Purpose and Summary..............................................1
 II. Background and Need for the Legislation..........................2
III. Legislative History..............................................4
 IV. Section-by-Section Analysis......................................6
  V. Evaluation of Regulatory Impact..................................7
 VI. Congressional Budget Office Cost Estimate........................7
VII. Changes to Existing Law Made by the Bill, as Reported...........11

                         I. Purpose and Summary

    The purpose of H.R. 2868 is to reauthorize the Department 
of Homeland Security's Chemical Facility Anti-Terrorism 
Standards (CFATS), which regulates security at high-risk 
facilities that make or use hazardous chemicals. Thousands of 
such facilities exist in the United States, and a successful 
terrorist attack on any of them could cause extensive harm. The 
CFATS program requires these high-risk facilities to design and 
implement site security plans to deter or prevent such attacks, 
and to respond more effectively if an attack does occur. As 
reported by the Committee, H.R. 2868 would extend the program 
until October 4, 2013, and add several voluntary features to 
the program.

                II. Background and Need for Legislation

    In the aftermath of the September 11, 2001 terrorist 
attacks, security experts and policymakers focused on the 
potential threat posed by thousands of facilities that make or 
use hazardous chemicals. A myriad of civic and industrial 
operations--including water purification, pharmaceutical 
production, oil refining and more--incorporate hazardous 
chemicals into their activities. Many of these facilities 
already faced environmental and safety regulations, but prior 
to the CFATS program they did not face any federal security 
program aimed at preventing and deterring a deliberate attack 
seeking to exploit the toxicity of such chemicals. Various 
expert reports and planning scenarios estimate that tens of 
thousands of people could be killed or hurt by a successful 
attack on certain high-risk chemical facilities.
    Early legislative proposals to regulate chemical site 
security did not advance in the years immediately following the 
9/11 attacks.
    In the 109th Congress, this Committee held numerous 
hearings on chemical site security that underscored the need 
for a federal program.\1\ Witnesses from the Bush 
Administration, the U.S. Chemical Safety and Hazard 
Investigation Board, the Government Accountability Office and 
elsewhere testified that chemical facilities present unique and 
potentially devastating security risks, and that voluntary 
efforts to secure them were not sufficient.\2\ In 2006, the 
Committee approved a bill, S. 2145 (S. Rept. 109-332) to create 
a chemical site security program at the Department of Homeland 
Security (DHS).\3\ While that particular bill was not 
considered by the full Senate, Congress later that year 
included an authorization for a DHS-led chemical security 
program in the Fiscal Year 2007 appropriations bill for the 
Department of Homeland Security.\4\ DHS issued rules for the 
program on April 9, 2007, which became effective on June 9, 
2007.\5\
---------------------------------------------------------------------------
    \1\Chemical Attack on America: How Vulnerable Are We? Hearing 
Before the Senate Comm. On Homeland Security and Governmental Affairs, 
S.Hrg. 109-62; Is the Federal Government Doing Enough to Secure 
Chemical Facilities and Is More Authority Needed? Hearing Before the 
Senate Comm. On Homeland Security and Governmental Affairs, S.Hrg. 109-
175; Chemical Facility Security: What is the Appropriate Federal Role? 
Hearing before the Senate Comm. on Homeland Security and Governmental 
Affairs, Parts I and II (S.Hrg. 109-382).
    \2\S. Rept. 109-332, Report of the Committee on Homeland Security 
and Governmental Affairs of the United States Senate to Accompany S. 
2145, pp. 7-17.
    \3\S. 2145 was introduced by Sens. Collins and Lieberman, with 
original cosponsors Sens. Coleman, Carper and Levin.
    \4\The Homeland Security Appropriations Act, 2007, P.L. 109-295, 
Section 550 (6 U.S.C. Sec. 121 note).
    \5\6 CFR Part 27 (April 9, 2007).
---------------------------------------------------------------------------
    That program, known as the Chemical Facility Anti-terrorism 
Standards or CFATS, is under way. The original authorization 
included a 3-year sunset that would have terminated the program 
on October 4, 2009. The program was extended until October 4, 
2010 by the Fiscal Year 2010 appropriations bill for the 
Department of Homeland Security.\6\ The President requested 
another one-year extension as part of the Fiscal Year 2011 
budget request.\7\
---------------------------------------------------------------------------
    \6\The Department of Homeland Security Appropriations Act, 2010, 
P.L. 111-83, Section 550. A bill making continuing appropriations for 
portions of Fiscal Year 2011 further extended CFATS until December 3, 
2010. Continuing Appropriations Act, 2011, P.L. 111-242, Section 124. A 
second bill making continuing appropriations for Fiscal Year 2011 
extended the program until December 18, 2010. P.L. 111-290.
    \7\The Budget of the United States Government, Fiscal Year 2011, 
Appendix, p. 574.
---------------------------------------------------------------------------
    The CFATS program generally applies to any facility that 
possesses more than a threshold amount of certain dangerous 
chemicals. Close to 38,000 facilities have completed ``Top 
Screen'' assessments to determine whether they fall under the 
program, and more than 6,000 have been preliminarily ``screened 
into'' the program by DHS.\8\ These facilities are reviewed for 
assignment to one of four risk tiers, with facilities in the 
riskiest tiers required to meet the most strenuous security 
requirements. As of October 2010, more than 4,700 high-risk 
facilities had received final tiering decisions under the CFATS 
program.
---------------------------------------------------------------------------
    \8\Chemical Security: Assessing Progress and Charting a Path 
Forward: Hearing Before the Senate Comm. on Homeland Security and 
Governmental Affairs, 111th Cong. (2010) (statement of Rand Beers). 
Since Under Secretary Beers' testimony, hundreds of those facilities 
were subsequently able to ``tier out'' of the program due to 
clarifications in their submissions or voluntary modifications in their 
operations.
---------------------------------------------------------------------------
    While extensions of the sunset provision are sufficient to 
keep the CFATS program going, there is widespread interest in a 
permanent or more long-term authorization to add predictability 
and stability to the program. Some lawmakers and advocates 
would also like to expand or revise the existing program in 
certain respects.
    As passed by the House, H.R. 2868 would permanently 
authorize, and make several significant changes to, the 
existing CFATS program. For example, the bill would require 
facilities covered under the existing Maritime Transportation 
Security Act (MTSA) to submit additional information to the 
Secretary to determine if such facilities present a similar 
security risk to those in the CFATS program and should be 
required to meet CFATS security standards. The bill would 
create a new security program governing drinking and wastewater 
facilities, which would be administered by the Environmental 
Protection Agency, in coordination with DHS. The House bill 
also would require all CFATS facilities to consider process 
modifications to reduce the consequences of a terrorist attack. 
If certain conditions were met, DHS would be allowed to mandate 
that covered facilities in the top two risk tiers implement 
these process changes. The House-passed bill also included 
additional changes. During a business meeting on July 28, 2010, 
the Committee considered H.R. 2868 and adopted a complete 
substitute that would extend the CFATS program for three years, 
until October 4, 2013. The substitute effectively would 
preserve the existing CFATS program, subject to any future 
adjustments DHS might implement through regulations or other 
directives consistent with the existing statutory authorization 
in Section 550 of P.L. 109-295. The substitute also would add 
new provisions to enhance implementation of the existing 
program. The substitute amendment would create voluntary 
exercise and training programs to improve collaboration with 
the private sector and State and local officials. It would 
create a voluntary technical assistance program to allow DHS, 
at the request of an owner or operator of a covered facility, 
to provide non-binding assistance or recommendations on CFATS 
compliance or to otherwise reduce the risk or consequences of a 
potential attack on the facility. The Secretary also would be 
directed to establish a program to collect information on best 
practices and cost-effective technologies for implementing 
CFATS and the voluntary technical assistance program, and to 
voluntarily share such information with covered facilities, 
consistent with certain protections for sensitive or 
proprietary data. The amendment would also create an advisory 
board to help DHS implement the voluntary technical assistance 
program and the CFATS program generally.

                        III. Legislative History

    H.R. 2868 was introduced on June 15, 2009, by 
Representative Bennie Thompson, Chairman of the Committee on 
Homeland Security, Representative Henry Waxman, Chairman of the 
Committee on Energy and Commerce, and others. The Committee on 
Homeland Security ordered the bill reported on June 23, 2009, 
by a vote of 18 to 11. The bill was next considered by the 
Committee on Energy and Commerce. That Committee ordered the 
bill reported, as amended, on October 21, 2009, on a 29 to 18 
vote. The full House approved the bill 230-193 on November 6, 
2009.\9\
---------------------------------------------------------------------------
    \9\H. Rept. 111-205 Part 1 (Committee on Homeland Security, July 
13, 2009); H. Rept. 111-205 Part 2 (Committee on Energy and Commerce, 
October 23, 2009). The bill's provisions regarding drinking water 
facilities are discussed in a related report: H. Rept. 111-313 to 
accompany H.R. 3258, The Drinking Water System Security Act of 2009.
---------------------------------------------------------------------------
    The bill was received in the Senate and referred to this 
Committee. On March 3, 2010, the Committee held a hearing on 
the CFATS program, titled ``Chemical Security: Assessing 
Progress and Charting a Path Forward.'' At that hearing, the 
DHS Under Secretary for the National Protection and Programs 
Directorate testified that the CFATS program is an important 
addition to the nation's homeland security efforts and should 
be extended and modified in several respects. Under Secretary 
Beers, joined by Peter S. Silva, Assistant Administrator for 
Water at the U.S. Environmental Protection Agency, laid out 
several key Administration ``principles'' related to the 
reauthorization of CFATS and other associated matters. First, 
the Administration endorsed the permanent authorization of the 
CFATS program. Second, Under Secretary Beers proposed creating 
an additional, parallel security program for drinking water and 
wastewater treatment facilities, led by the Environmental 
Protection Agency but supported by DHS. Within the modified 
CFATS program, the Administration proposed that all covered 
facilities be required to consider implementation of 
``inherently safer technology'' or IST, and sought the ability 
to mandate the implementation of IST options for facilities in 
the two riskiest tiers, subject to various conditions. Drinking 
water and wastewater treatment facilities would be subject to 
similar requirements with respect to IST. In addition to these 
modifications, the Administration recommended that facilities 
regulated under the Maritime Transportation Security Act (MTSA) 
meet equivalent security standards to those facilities under 
CFATS to ensure consistent security across the different 
regulatory regimes.
    A second panel included witnesses from different 
stakeholder groups.
    Darius Sivin, legislative representative for the 
International Union, United Automobile, Aerospace and 
Agricultural Implement Workers of America, endorsed many key 
features of H.R. 2868, such as creating security requirements 
for drinking water and wastewater treatment facilities and 
requiring facilities to consider, and in some cases implement, 
safer technologies. Sivin testified that his union represents 
workers in a number of facilities that use high-risk chemicals, 
and that those chemicals put both the workers and surrounding 
communities in potential danger in the event of an accident or 
terrorist attack. Sivin said he believes at least some of these 
facilities and other high-risk facilities can implement safer 
processes that would improve security without risking jobs. He 
cited the example of numerous wastewater treatment facilities 
that have converted from chlorine gas to ultraviolet light or 
liquid chlorine bleach.\10\
---------------------------------------------------------------------------
    \10\Sivin's union is part of a coalition of more than 50 
environmental, labor and other citizen groups, known as the Blue-Green 
Coalition, lobbying for expanded and permanent chemical site security 
rules. A statement from the Coalition is included in the record for the 
March 3, 2010 hearing. The statement notes that the current CFATS 
program omits hundreds of facilities that are potentially high-risk 
(i.e. drinking water and wastewater treatment facilities and those in 
port areas), and does nothing to explicitly promote or require the 
adoption of safer processes. At Senator Lieberman's request, the record 
also includes a report from the Center for American Progress detailing 
dozens of instances in which facilities are using extremely hazardous 
materials or processes when safer alternatives may exist (and in some 
cases have been implemented by similar facilities).
---------------------------------------------------------------------------
    However, witnesses for two chemical industry trade 
associations said it is premature to change the CFATS program, 
and expressed support for a bill by Senator Collins, S. 2996, 
to extend the existing CFATS rules for an additional five 
years--until October 4, 2015.\11\ Timothy J. Scott, Chief 
Security Officer at Dow Chemical Company and testifying on 
behalf of the American Chemistry Council, said the five-year 
extension would give DHS time to fully implement and assess the 
existing rules and give facilities needed regulatory stability. 
Scott said companies are in the process of complying with 
CFATS, and the program will require many of those facilities to 
make significant new investments in security.
---------------------------------------------------------------------------
    \11\Senator Collins also entered into the record letters indicating 
support for S. 2996 from 28 other organizations and businesses. Senator 
Collins also entered statements for the record from Dr. Sam Mannan, 
Director of the Mary Kay O'Connor Process Safety Center at Texas A&M 
University; Mr. Tom Curtic, Deputy Executive Director for Governmental 
Affairs for the American Water Works Association (AWWA); and the 
National Petrochemical & Refiners Association (NPRA). In his testimony 
for the record, Dr. Mannan focused on the need for far more research 
and data before a federal mandate to implement or even consider 
``inherently safer technology'' could be incorporated into the law. 
AWWA's testimony raised its concerns with the ability of the federal 
government to mandate ``inherently safer technology'' at water 
utilities, stressing its belief that ``such decisions must be based on 
critical local factors'' and that any legislation on the issue ``must 
retain local decision making authority.'' NPRA's testimony expressed 
support for S. 2996 and urged that ``decisions [regarding `inherently 
safer technology'] should be left to individual sites and not mandated 
by DHS.''
---------------------------------------------------------------------------
    Stephen Poorman, testifying for the Society of Chemical 
Manufacturers and Affiliates, warned that the House bill would 
cost jobs and threaten production of popular products. Poorman 
criticized a requirement that all facilities covered by CFATS 
consider IST options and the ability of DHS to mandate 
implementation for the riskiest facilities under certain 
conditions, warning that such process decisions are too complex 
to lend themselves to regulation. He said some companies are 
already adopting alternative processes as a means to drop out 
of the CFATS program or move to a lower risk tier within the 
program.
    The Committee considered H.R. 2868 on July 28, 2010. At the 
markup, Chairman Lieberman endorsed extending the CFATS 
program, and also expressed support for changes included in the 
House bill to require CFATS facilities to assess and in some 
cases implement safer technologies, and to extend parallel 
security requirements to drinking and wastewater 
facilities.\12\ Senator Collins said the existing CFATS program 
is effective and that it would be premature and potentially 
harmful to make major changes. Senator Collins, on behalf of 
herself and Senators Pryor, Voinovich, and Landrieu, offered a 
substitute amendment to strike all of the House bill and 
replace it with a three-year extension of the existing CFATS 
rules, augmented by several additional features such as 
voluntary exercise and training programs, voluntary technical 
assistance programs, and increased information sharing between 
DHS and industry on best practices. The Committee adopted the 
Collins substitute amendment by unanimous consent.\13\ Members 
then voted 13-0 to report the bill as amended, with Senators 
Lieberman, Levin, Akaka, Carper, Pryor, Landrieu, McCaskill, 
Tester, Collins, Brown, McCain, Voinovich, and Ensign voting 
Yea. No Senator voted Nay. For the record only, Senators 
Burris, Kaufman, Coburn, and Graham voted Yea by proxy. There 
were no senators voting Nay by proxy.
---------------------------------------------------------------------------
    \12\www.hsgac.senate.gov/public/index.cfm?FuseAction = 
Files.View&&FileStore id=16717035-b7ed-40ae-965d-1647lef1e39b
    \13\Senator Carper circulated and discussed an amendment to require 
facilities in the CFATS program to require all facilities in the 
program to assess inherently safer technology options to improve 
security--similar to an existing state requirement in New Jersey. 
Senator Carper urged members to consider adding such a requirement to 
the CFATS program as the reauthorization bill advanced, but did not 
formally offer the amendment or seek a vote on it.
---------------------------------------------------------------------------

                    IV. Section-by-Section Analysis

Section 1. Short title

    This section names the Act the ``Continuing Chemical 
Facilities Antiterrorism Security Act of 2010.''

Section 2. Extension of Chemical Facilities Security Program

    (a) This subsection extends the authorization for the 
Chemical Facilities Anti-Terrorism Standards, Section 550(b) of 
Homeland Security Appropriations Act, 2007 (6 U.S.C. 121 note), 
for three years until October 4, 2013.
    (b) This subsection includes several enhancements to the 
existing CFATS program: a voluntary chemical security training 
program; a voluntary chemical security exercise program; a 
voluntary technical assistance program; and creation of an 
advisory board to help implement the technical assistance 
program.
    Voluntary Chemical Security Training Program--The 
legislation would direct the Administrator of the Federal 
Emergency Management Agency (FEMA), in coordination with the 
DHS Under Secretary for National Protection and Programs 
(NPPD), to establish a voluntary training program to enhance 
the capabilities of high-risk chemical facilities to prevent, 
prepare for, respond to, mitigate against, and recover from 
threatened or actual acts of terrorism, and natural and man-
made disasters. The program should encompass governmental and 
private sector entities across multiple disciplines, and should 
be coordinated with training offered by other institutions.
    Voluntary Chemical Security Exercise Program--The 
legislation also directs FEMA, in coordination with NPPD, to 
establish a voluntary exercise program to test and evaluate the 
capabilities of governmental and private sector entities to 
prevent, prepare for, mitigate against, respond to, and recover 
from an attack or disaster at facilities using hazardous 
chemicals. The program should include live exercises for high 
risk facilities, and should be assessed to establish best 
practices that can be shared with affected stakeholders.
    Voluntary Technical Assistance Program--The legislation 
would direct the DHS Assistant Secretary for Infrastructure 
Protection, in coordination with the Under Secretary for 
Science and Technology, to create a voluntary technical 
assistance program to provide non-binding assistance or 
recommendations to facilities on measures to reduce the risk of 
or consequences from a potential attack on the facility, such 
as employing safer chemicals or processes. The program would 
receive at least $5 million annually, to be drawn from the 
overall CFATS appropriation.
    Advisory Board--The legislation would direct the Secretary 
of Homeland Security to establish a 9-member Chemical Facility 
Security Advisory Board to advise the Department on 
implementation of the CFATS program, including the voluntary 
technical assistance program created by this section. The board 
must include at least 5 owners or operators of a covered 
facility, at least two employees of such facilities, and two 
additional experts in the fields of chemistry, security, 
process design and engineering, and other related fields. This 
board would be established under section 871 of the Homeland 
Security Act, and would be subject to the Federal Advisory 
Committee Act (5 U.S.C. App.).

                   V. Evaluation of Regulatory Impact

    Pursuant to the requirements of paragraph 11(b) of rule 
XXVI of the Standing Rules of the Senate, the Committee has 
considered the regulatory impact of this bill. As indicated in 
the Congressional Budget Office cost estimate for this bill 
(included below), the bill as amended would extend an existing 
regulatory program with few changes and should not result in 
significant additional costs beyond the current costs of 
complying with the CFATS program.

             VI. Congressional Budget Office Cost Estimate

                                     U.S. Congress,
                               Congressional Budget Office,
                                 Washington, DC, November 16, 2010.
Hon. Joseph I. Lieberman,
Chairman, Committee on Homeland Security and Governmental Affairs, U.S. 
        Senate, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 2868, the 
Continuing Chemical Facilities Antiterrorism Security Act of 
2010.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Jason 
Wheelock.
            Sincerely,
                                              Douglas W. Elmendorf.
    Enclosure.

H.R. 2868--Continuing Chemical Facilities Antiterrorism Security Act of 
        2010

    Summary: H.R. 2868 would extend through fiscal year 2013 
the Department of Homeland Security's (DHS's) authority to 
regulate security at chemical facilities that present a high 
level of security risk. In addition, the act would establish 
programs to provide technical assistance to such facilities on 
methods to reduce the risk of or consequences from acts of 
terrorism, and security training for facilities personnel and 
first responders.
    CBO estimates that implementing this legislation would cost 
$414 million over the 2011-2015 period, assuming appropriation 
of the necessary amounts. Enacting H.R. 2868 would not affect 
direct spending or revenues; therefore, pay-as-you-go 
procedures do not apply.
    H.R. 2868 would extend intergovernmental and private-sector 
mandates, as defined in the Unfunded Mandates Reform Act 
(UMRA), on owners and operators of public and private 
facilities where certain chemicals are present. Based on 
information from DHS and industry sources, CBO estimates that 
the aggregate costs of complying with the mandates would be 
small and would fall below the annual thresholds established in 
UMRA for intergovernmental and private-sector mandates ($70 
million and $141 million, respectively, in 2010, adjusted 
annually for inflation).
    Estimated cost to the Federal Government: The estimated 
budgetary impact of H.R. 2868 is shown in the following table. 
The cost of this legislation falls within budget functions 050 
(national defense) and 450 (community and regional 
development).

----------------------------------------------------------------------------------------------------------------
                                                                 By fiscal year, in millions of dollars--
                                                         -------------------------------------------------------
                                                            2011     2012     2013     2014     2015   2011-2015
----------------------------------------------------------------------------------------------------------------
                                  CHANGES IN SPENDING SUBJECT TO APPROPRIATION

Chemical Facilities Antiterrorism Security Program:
    Estimated Authorization Level.......................       84       86       88        0        0       258
    Estimated Outlays...................................       29       59       82       54       24       248
FEMA Chemical Security Programs:
    Estimated Authorization Level.......................       18       35       36       37       38       164
    Estimated Outlays...................................       11       28       36       37       38       150
Voluntary Technical Assistance Program:
    Authorization Level.................................        5        5        5        0        0        15
    Estimated Outlays...................................        2        4        5        3        1        15
Chemical Facility Advisory Board:
    Estimated Authorization Level.......................        *        *        *        *        *         1
    Estimated Outlays...................................        *        *        *        *        *         1
Total Changes:
    Estimated Authorization Level.......................      107      126      129       37       38       438
    Estimated Outlays...................................       42       91      123       94       63      414
----------------------------------------------------------------------------------------------------------------
Notes: Components do not sum to totals because of rounding.
FEMA = Federal Emergency Management Agency; * = less than $500,000.

    Basis of estimate: For this estimate, CBO assumes that H.R. 
2868 will be enacted in calendar year 2010, that the estimated 
and specified amounts will be appropriated each year, and that 
outlays will follow historical spending patterns for existing 
or similar programs.

Chemical Facilities Antiterrorism Security Program

    The act would extend for three years the authority for DHS 
to regulate security at chemical facilities in the United 
States that present a high level of security risk. Under the 
current program, DHS reviews the security plans of high-risk 
facilities and conducts on-site inspections to evaluate 
compliance with site-specific security plans and the Chemical 
Facility Antiterrorism Standards (CFATS). Not including 
personnel compensation, DHS received approximately $56 million 
in fiscal year 2010 to conduct such activities. In addition, 
CBO estimates that DHS received $27 million in that same year 
to pay for salaries and benefits of the DHS employees 
associated with the CFATS program. Based on current personnel 
levels and expenditures, CBO estimates that continuing this 
effort would require the employment of approximately 200 
personnel within DHS's National Protection and Programs 
Directorate, and would cost about $250 million over the 2011-
2015 period.

FEMA Chemical Security Programs

    H.R. 2868 contains provisions that would direct the Federal 
Emergency Management Agency (FEMA) to provide voluntary 
training and exercises for high-risk chemical facilities to 
prevent, prepare for, respond to, and recover from natural and 
man-made disasters and other emergencies. Training would target 
officials and emergency responders from all levels of 
government and the private sector, as well as individuals 
located in neighborhoods adjacent to such facilities. Based on 
current and historical expenditures of similar preparedness 
programs--including FEMA's Radiological Emergency Preparedness 
Program--and assuming lower costs in 2011 for enactment part 
way through the fiscal year, CBO estimates that those 
provisions would cost $150 million over the 2011-2015 period.

Voluntary Technical Assistance Program

    H.R. 2868 would establish a technical assistance program 
through which DHS would provide assistance and recommendations 
to chemical facilities to enable such facilities to reduce the 
risk of and consequences from acts of terrorism. As part of the 
program, DHS would be required to develop a repository of 
information on effective practices for implementing CFATS. The 
act would authorize the appropriation of $5 million annually 
through 2013 to provide technical assistance to facilities that 
request aid under the program. Based on the authorized amounts, 
CBO estimates that implementing this provision would cost $15 
million over the 2011-2015 period.

Chemical Facility Advisory Board

    The act would require that the Secretary of DHS establish a 
Chemical Facility Advisory Board. The board would consist of 
nine members, seven of whom would represent chemical facilities 
covered by the CFATS and two of whom would be experts on topics 
related to the security of chemical facilities. CBO estimates, 
based on the costs associated with other DHS advisory bodies, 
that implementing this provision would cost $1 million over the 
2011-2015 period.
    Pay-As-You-Go considerations: None.
    Intergovernmental and private-sector impact: H.R. 2868 
would extend intergovernmental and private-sector mandates, as 
defined in UMRA, on owners and operators of public and private 
facilities where certain chemicals are present. Based on 
information from DHS and industry sources, CBO estimates that 
the aggregate costs of complying with the mandates would be 
small and would fall below the annual thresholds established in 
UMRA for intergovernmental and private-sector mandates ($70 
million and $141 million, respectively, in 2010, adjusted 
annually for inflation).
    The act would extend, for three years, mandates contained 
in CFATS, which are set to expire in December 2010. Those 
mandates require owners and operators of public and private 
facilities where certain chemicals are present to assess the 
vulnerability of their facilities to a terrorist incident and 
to prepare and implement security plans. The act also would 
extend mandates that require owners and operators of such 
facilities to maintain records, periodically submit reviews of 
the adequacy of vulnerability assessments or security plans, 
and allow DHS access to their property for inspections and 
verifications. In addition, owners and operators would have to 
continue to conduct background checks on employees who have 
access to restricted areas, and provide training to employees. 
Because facilities must currently comply with the existing 
CFATS regulations, CBO estimates that the cost of continuing to 
comply with those regulations would be small relative to the 
annual thresholds established in UMRA.
    Previous CBO estimates: On October 23, 2009, CBO 
transmitted a cost estimate for H.R. 2868 as ordered reported 
by the House Committee on Energy and Commerce on October 22, 
2009. In addition, on July 9, 2009, CBO transmitted a cost 
estimate for H.R. 2868 as ordered reported by the House 
Committee on Homeland Security on June 23, 2009. Both of those 
versions of the legislation would permanently authorize and 
expand the authority of DHS to regulate security at chemical 
facilities and would authorize the appropriation of $900 
million over the 2011-2013 period for such purpose, a 
significant increase over current spending levels.
    The Senate version of the legislation does not provide a 
specific authorization of appropriations and would extend the 
existing authority for DHS to regulate chemical facilities 
until the end of fiscal year 2013. The estimated costs for this 
version of the legislation reflect its more limited scope.
    Estimate prepared by: Federal Costs: Jason Wheelock (DHS) 
and Daniel Hoople (FEMA); Impact on State, Local, and Tribal 
Governments: Melissa Merrell; Impact on the Private Sector: 
Paige Piper/Bach.
    Estimate approved by: Theresa Gullo, Deputy Assistant 
Director for Budget Analysis.

       VII. Changes to Existing Law Made by the Bill, as Reported

    In compliance with paragraph 12 of rule XXVI of the 
Standing Rules of the Senate, changes in existing law made by 
H.R. 2868 as reported are shown as follows (existing law 
proposed to be omitted is enclosed in brackets, new matter is 
printed in italic, and existing law in which no change is 
proposed is shown in roman):

                           UNITED STATES CODE

                       TITLE 6--DOMESTIC SECURITY

CHAPTER 1--HOMELAND SECURITY ORGANIZATION

           *       *       *       *       *       *       *

   SUBCHAPTER II--INFORMATION ANALYSIS AND INFRASTRUCTURE PROTECTION

Part A--Information and Analysis and Infrastructure Protection; Access 
                             to Information

SEC. 121. INFORMATION AND ANALYSIS AND INFRASTRUCTURE PROTECTION.

           *       *       *       *       *       *       *

                              REGULATIONS

    Pub. L. 109-295, title V, Sec. 550, Oct. 4, 2006, 120 Stat. 
1388, as amended by Pub. L. 110-161, div. E, title V, Sec. 534, 
Dec. 26, 2007, 121 Stat. 2075; Pub. L. 111-83, title V, Sec. 
550, Oct. 28, 2009, 123 Stat. 2177, provided that:
    ``(a) * * *
    ``(b) Interim regulations issued under this section shall 
apply until the effective date of interim or final regulations 
promulgated under other laws that establish requirements and 
standards referred to in subsection (a) and expressly supersede 
this section: Provided, That the authority provided by this 
section shall terminate on [October 4, 2010] October 4, 2013.

           *       *       *       *       *       *       *

                 TITLE XXI--CHEMICAL FACILITY SECURITY

SEC. 2101. DEFINITIONS.

    In this title--
          (1) the term ``Board'' means the Chemical Facility 
        Security Advisory Board established under section 
        2105(a);
          (2) the term ``Chemical Facility Anti-Terrorism 
        Standards'' means the interim final regulations issued 
        by the Secretary under section 550 of the Department of 
        Homeland Security Appropriations Act, 2007 (6 U.S.C. 
        121 note); and
          (3) the term ``covered chemical facility'' means a 
        chemical facility subject to the Chemical Facility 
        Anti-Terrorism Standards.

SEC. 2102. CHEMICAL SECURITY TRAINING PROGRAM.

    (a) Establishment.--Acting through the Administrator of the 
Federal Emergency Management Agency and in coordination with 
the Under Secretary for National Protection and Programs, the 
Secretary shall establish a voluntary chemical security 
training program (referred to in this section as the ``training 
program'') for the purpose of enhancing the capabilities of 
high-risk chemical facilities to prevent, prepare for, respond 
to, mitigate against, and recover from threatened or actual 
acts of terrorism, natural disasters, and other man-made 
disasters.
    (b) Requirements.--The training program shall provide 
validated voluntary training that--
          (1) reaches multiple disciplines, including Federal, 
        State, and local government officials, commercial 
        personnel and management, and governmental and 
        nongovernmental emergency response providers;
          (2) provides training at the awareness, performance, 
        and management and planning levels;
          (3) uses multiple training mediums and methods;
          (4) is coordinated with training provided by 
        government training facilities, academic institutions, 
        private organizations, and other entities that provide 
        specialized, state-of-the-art training for governmental 
        and nongovernmental emergency responder providers or 
        commercial personnel and management;
          (5) uses, as appropriate, government training 
        facilities, courses provided by community colleges, 
        public safety academies, State and private 
        universities, and other facilities;
          (6) is consistent with, and supports implementation 
        of, the National Incident Management System, the 
        National Response Framework, the National 
        Infrastructure Protection Plan, the National 
        Preparedness Guidance, the National Preparedness Goal, 
        the National Maritime Transportation Security Plan, and 
        other such national initiatives, and any successors 
        thereto;
          (7) is evaluated against clear and consistent 
        performance measures;
          (8) addresses security requirements under chemical 
        facility security plans; and
          (9) educates, trains, and involves individuals in 
        neighborhoods around chemical facilities on how to 
        observe and report security risks.

SEC. 2103. CHEMICAL SECURITY EXERCISE PROGRAM.

    (a) In General.--Acting through the Administrator of the 
Federal Emergency Management Agency and in coordination with 
Under Secretary for National Protection and Programs, the 
Secretary shall develop a voluntary chemical security exercise 
program (referred to in this section as the ``exercise 
program'') for the purpose of offering voluntary testing and 
evaluation of the capabilities of the Federal Government, State 
governments, commercial personnel and management, governmental 
and nongovernmental emergency response providers, the private 
sector, or any other organization or entity, as the Secretary 
determines to be appropriate, to prevent, prepare for, mitigate 
against, respond to, and recover from acts of terrorism, 
natural disasters, and other emergencies at chemical 
facilities.
    (b) Requirements.--Under the exercise program, the 
Secretary shall conduct, on a periodic basis, voluntary joint 
security exercises at chemical facilities that are--
          (1) scaled and tailored to the needs of each chemical 
        facility;
          (2) for the highest risk chemical facilities, as 
        determined by the Secretary, live training exercises;
          (3) as realistic as practicable and based on current 
        risk assessments, including credible threats, 
        vulnerabilities, and consequences;
          (4) consistent with the National Incident Management 
        System, the National Response Framework, the National 
        Infrastructure Protection Plan, the National 
        Preparedness Guidance, the National Preparedness Goal, 
        the National Maritime Transportation Security Plan, and 
        other such national initiatives, and any successors 
        thereto;
          (5) evaluated against clear and consistent 
        performance measures;
          (6) assessed to learn best practices, which shall be 
        shared with appropriate Federal, State, and local 
        officials, commercial personnel and management, 
        governmental and nongovernmental emergency response 
        providers, and the private sector;
          (7) followed by remedial action in response to 
        lessons learned; and
          (8) designed to assist State and local governments 
        and chemical facilities in designing, implementing, and 
        evaluating exercises that--
                  (A) conform to the requirements of this 
                paragraph; and
                  (B) are consistent with any applicable Buffer 
                Zone Protection Plan, State homeland security 
                plan, or urban area homeland security plan.

SEC. 2104. VOLUNTARY TECHNICAL ASSISTANCE PROGRAM.

    (a) Establishment.--The Secretary, acting through the 
Assistant Secretary for Infrastructure Protection, in 
coordination with the Under Secretary for Science and 
Technology, and in consultation with the Board, shall establish 
a voluntary technical assistance program under which, upon 
request by the owner or operator of a covered chemical 
facility, and subject to the availability of resources at the 
Department, the Secretary may provide nonbinding assistance or 
recommendations to the owner or operator to--
          (1) reduce the risk or consequences associated with a 
        successful act of terrorism against a covered chemical 
        facility, including the reduction of risk or 
        consequences--
                  (A) sufficient to decrease the risk-based 
                tier assigned to the covered chemical facility 
                under the Chemical Facility Anti-Terrorism 
                Standards; or
                  (B) such that the covered chemical facility 
                no longer presents a high level of security 
                risk; or
          (2) aid in compliance with the risk based performance 
        standards applicable to the covered chemical facility 
        under the Chemical Facility Anti-Terrorism Standards.
    (b) Voluntary Nature of Assistance.--
          (1) In general.--The decision to--
                  (A) participate in the voluntary technical 
                assistance program under this section; or
                  (B) implement any assistance or 
                recommendations provided by the Secretary under 
                this section,
        shall be at the sole discretion of the owner or 
        operator of a covered chemical facility.
          (2) No required assessment.--The Secretary may not 
        require the owner or operator of a covered chemical 
        facility to--
                  (A) consider any assistance or recommendation 
                provided under this section as part of a 
                security vulnerability assessment under the 
                Chemical Facility Anti-Terrorism Standards; or
                  (B) assess, directly or indirectly, the 
                costs, benefits, economic or technical 
                feasibility, or practicality of implementing 
                any assistance or recommendation provided under 
                this section.
          (3) Site security plan review.--If the site security 
        plan for a covered chemical facility satisfies the 
        risk-based performance standards applicable to the 
        covered chemical facility under the Chemical Facility 
        Anti-Terrorism Standards, the Secretary may not 
        disapprove the site security plan based on--
                  (A) a decision by the owner or operator of a 
                covered chemical facility not to--
                          (i) participate in the voluntary 
                        technical assistance program under this 
                        section; or
                          (ii) implement assistance or a 
                        recommendation provided by the 
                        Secretary under this section; or
                  (B) the presence or absence of a particular 
                security measure.
          (4) Effect on tiering.--At the request of the owner 
        or operator of a covered chemical facility, the 
        Secretary shall advise the owner or operator of the 
        overall effect that implementing all categories of 
        assistance or recommendations provided by the Secretary 
        under this section would have on the determination by 
        the Secretary--
                  (A) of the placement of the covered chemical 
                facility in a risk-based tier under the 
                Chemical Facility Anti-Terrorism Standards; or
                  (B) regarding whether the covered chemical 
                facility would no longer present a high level 
                of security risk.
          (5) Civil liability.--
                  (A) In general.--Subject to subparagraph (B), 
                no action, or failure to act, by the owner or 
                operator of a covered chemical facility 
                relating to assistance or a recommendation 
                provided by the Secretary under this section 
                shall be interpreted, construed, implied, or 
                applied to create any liability or cause of 
                action for compensation for bodily injury, any 
                other injury, or property damage to any person 
                that may result from an act of terrorism or 
                incident at the covered chemical facility.
                  (B) Additional or intervening acts or 
                omissions.--Subparagraph (A) shall not apply to 
                any injury or damage caused by any additional 
                or intervening act or omission of the owner or 
                operator of a covered chemical facility.
                  (C) Rule of construction.--Except as provided 
                in this section, nothing in subparagraph (A) 
                shall be construed to abrogate or limit any 
                right, remedy, or authority that the Federal 
                Government, any State or local government, or 
                any entity or agency of the Federal Government 
                or a State or local government may possess 
                under any other provision of law.
    (c) Best Practices.--Subject to subsection (d), the 
Secretary shall develop a repository for information and data 
on best practices and cost-effective technologies for 
implementing the Chemical Facility Anti-Terrorism Standards and 
the voluntary technical assistance program under this section.
    (d) Information Protection.--Any information obtained by 
the Secretary under the voluntary technical assistance program 
under this section or for purposes of subsection (c) shall--
          (1) to the extent that the information may reveal 
        vulnerabilities or other details of the security 
        capabilities of a covered chemical facility that may be 
        exploited by terrorists, be protected as chemical-
        terrorism vulnerability information under the Chemical 
        Facility Anti-Terrorism Standards; and
          (2) to the extent that the information may reveal 
        trade secrets or commercial or financial information 
        that is not customarily in the public domain, be 
        protected as though the information was voluntarily 
        shared critical infrastructure information under 
        section 214, except that the requirement under section 
        214 that the information be voluntarily submitted, 
        including the requirement for an express statement 
        specified in section 214(a)(2), shall not apply to 
        information obtained under this section.
    (e) Report on Lessons Learned.--Not later than October 4, 
2013, the Secretary, in coordination with the Board, shall 
submit to the Committee on Homeland Security and Governmental 
Affairs of the Senate and the Committee on Homeland Security of 
the House of Representatives a report regarding lessons learned 
from the voluntary technical assistance program under this 
section.
    (f) Availability of Appropriations.--Of the amounts made 
available for the Chemical Facility Anti-Terrorism Standards 
for each of fiscal years 2011 through 2013, not less than 
$5,000,000 shall be made available for the provision of 
voluntary technical assistance under this section.

SEC. 2105. CHEMICAL FACILITY SECURITY ADVISORY BOARD.

    (a) Establishment.--Not later than 90 days after the date 
of enactment of this section, the Secretary shall establish 
under section 871 a Chemical Facility Security Advisory Board.
    (b) Responsibilities.--The Board shall advise the Secretary 
on the implementation of the Chemical Facility Anti-Terrorism 
Standards, including regarding the implementation of the 
voluntary technical assistance program under section 2103.
    (c) Membership.--There shall be 9 members of the Board, who 
shall be appointed by the Secretary and shall represent a 
geographic and substantive cross-section of the United States, 
including--
          (1) not less than 5 owners or operators of covered 
        chemical facilities;
          (2) not less than 2 employees of covered chemical 
        facilities with direct responsibility for process 
        design and engineering, production and operations, or 
        chemical process security, and
          (3) not less than 2 other experts in the fields of 
        chemistry, security, process design and engineering, 
        process controls and instrumentation, environmental 
        health and safety, maintenance, production and 
        operations, or chemical process security.
    (d) Term.--The members of the Board shall be appointed for 
such terms as the Secretary may determine.
    (e) Applicability of Federal Advisory Committee Act.--The 
Federal Advisory Committee Act (5 U.S.C. App.) shall apply to 
the Board.

SEC. 2106. AUTHORIZATION OF APPROPRIATIONS.

    There are authorized to be appropriated to the Secretary 
such sums as are necessary to carry out this title.

                                  
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