*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 

EO12866_RIN2070-AJ44_Formaldehyde-TPCs-NPRM_EA_Redline_Revisions_2012-08-14.docx

Revised to address Interagency Comments received under EO 12866 Review.

Economic Analysis of the Third-Party Certification 

Framework for the Formaldehyde Standards for 

Composite Wood Products Proposed Rule

RIN 2070-AJ44

EO 12866 REVIEW DRAFT 

Economic and Policy Analysis Branch 

Economics, Exposure and Technology Division 

Office of Pollution Prevention and Toxics 

Office of Chemical Safety and Pollution Prevention 

U.S. Environmental Protection Agency 

MarchAugust 2012 

 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 

Acknowledgment

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

Cambridge, Massachusetts in the preparation of this report, provided under Contract No. EP-W08-10. 

 

Notice 

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

applicable regulatory requirements. This document was prepared to provide economic 

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

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

document contains various assumptions that may not reflect the regulatory 

determinations that an individual firm or organization would make were it to apply the 

rule's requirements to its specific circumstances. Persons seeking information on 

specific regulatory requirements should consult 40 CFR Part 770, and the preamble 

for the regulatory action. 

Mention of the names of specific companies, organizations, or entities does not 

constitute an endorsement by EPA. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule i

Table of Contents 

Notice 

1 Summary of Economic Analysis .........................................................................................1

2 Certification System .............................................................................................................6

2.1 Certification System Framework ...........................................................................................6

2.2 Profile of Third Party Certifiers and Accreditation Bodies ..................................................10

3 Costs of the TSCA Title VI TPC Rule ..............................................................................16

3.1 Proposed Rule Requirements ...............................................................................................16

3.2 Wage Rates Used in the Analysis ........................................................................................17

3.3 Costs to Accreditation Bodies ..............................................................................................18

3.4 Third-Party Certifier Costs ...................................................................................................20

3.5 Total Cost to TPCs ...............................................................................................................29

3.6 Total Costs of the Rule for U.S. Accreditation Bodies and TPCs .......................................30

4 Impact Analyses ..................................................................................................................33

4.1 Paperwork Reduction Act Analysis .....................................................................................33

4.2 Regulatory Flexibility Act Analysis .....................................................................................34

4.3 Unfunded Mandates Reform Act (UMRA) ..........................................................................38

4.4 Executive Order 13132 - Federalism ...................................................................................39

4.5 Executive Order 13175 - Tribal Implications ......................................................................39

4.6 Executive Order 13045 - Protection of Children .................................................................39

4.7 Executive Order 13211 - Energy Effects .............................................................................39

4.8 National Technology Transfer and Advancement Act .........................................................40

4.9 Executive Order 12898 – Environmental Justice .................................................................40

Appendix A: Wage Rates 

Appendix B: Recordkeeping and Reporting Burdens

Appendix C: Costs and Benefits of Electronic Reporting
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 1

1 1 Summary of Economic Analysis 

2 

3 

4 This report presents an economic analysis of the U.S. Environmental Protection Agency 

5 (EPA)’s proposed Third Party Certification rule. The Formaldehyde Standards for Composite 

6 Wood Products Act, which created Title VI of the Toxic Substances Control Act (TSCA), 

7 established formaldehyde emission standards for composite wood products (hardwood plywood, 

8 medium-density fiberboard, and particleboard) sold, supplied, offered for sale or manufactured in 

9 the United States. Under TSCA Tile VI, manufacturers of composite wood products must 

10 comply with specific formaldehyde emission standards, and their compliance must be verified by 

11 a third party certifier (TPC). 

12 

13 Third-party certification involves a process by which a product, process or service is 

14 reviewed by a reputable and qualified independent third-party to verify that a set of norms, 

15 criteria, claims, practices or standards are being met. The standards used in a third-party 

16 certification process are typically voluntary consensus standards developed by nationally or 

17 internationally recognized standards-producing organizations or industry groups. TPCs are 

18 overseen by accreditation bodies (ABs), which provide an impartial verification of the 

19 competency of the TPCs. 

20 

21 The proposed TPC rule establishes a framework whereby ABs accredit TPCs so that the 

22 TPCs may certify composite wood product manufacturers under TSCA Title VI. The proposed 

23 rule identifies the roles and responsibilities ABs and TPCs, as well as the criteria for 

24 participating in the program. Under the proposed framework, participating ABs would accredit 

25 TPCs, audit TPCs, maintain records on their accredited TPCs, and report to EPA on TPCs’ 

26 activities. TPCs would be responsible for activities such as regularly auditing manufacturers, 

27 conducting and verifying formaldehyde emissions tests, and ensuring that manufacturer quality 

28 assurance and quality control procedures and testing comply with the requirements set forth in 

29 the TSCA Title VI rule. 

30 

31 Under the TSCA Title VI rule, participating accreditingaccreditation bodies will need to 

32 familiarize themselves with the rule (in the first year), submit an application and enter into a 

33 recognition agreement with EPA (in the first year and every three years thereafter), and provide 

34 notifications and reports and keep records (every year). As shown in Table 1-1, accreditation 

35 bodies are expected to incur costs of $1,685 in the first year, $1,070 in years with reapplication 

36 and recognition agreement resubmissions, and $633 in other years. 

37 

Table 1-1: Costs per Accreditation Body 

Type of Cost Cost (2010$) 

First Year Reapplication Years1 Non-Reapplication Years 

Rule Familiarization $615 $0 $0 

Application or Reapplication Process $88 $88 $0 

Prepare Recognition Agreement $349 $349 $0 

EPA Notification $57 $57 $57 

TPC Notification $12 $12 $12 

Recordkeeping $308 $308 $308 

Reporting $256 $256 $256 

Cost per Accreditation Body $1,685 $1,070 $633 
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August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 2

1

 Accreditation bodies are required to reapply to the program every three years. 

38 

39 Eight accreditation bodies in the U.S. are assumed to participate in the TSCA Title VI 

40 program. As shown in Table 1-2, total annual costs to U.S. accreditation bodies are estimated to 

41 be $13,480 in the first year, $8,560 in years when accreditingaccreditation bodies must reapply 

42 to the program, and $5,064 in other years. Annualized costs are estimated at $6,204303 to 

43 $6,222320 per year, depending on the discount rate. 

44 

Table 1-2: Total Costs for U.S. Accreditation Bodies 

Type of Cost Cost (2010$) 

First Year Reapplication Years1 Non-Reapplication Years 

Cost per Accreditation Body $1,685 $1,070 $633 

Number of U.S. Accreditation Bodies 8 8 8 

Total Costs for U.S. Accreditation Bodies $13,480 $8,560 $5,064 

Annualized Costs (30 years, 3 percent) $6,303 

Annualized Costs (30 years, 7 percent) $6,320 1

 Accreditation bodies are required to reapply to the program every three years. 

45 

46 TPCs participating in the TSCA Title VI program will need to conform to several 

47 voluntary standards and guides by the International Organization for Standardization (ISO) and 

48 International Electrotechnical Commission (IEC). Accreditations can cost TPCs up to $25,000 

49 obtain and $5,000 per year to maintain, but most TPCs will already have all the necessary 

50 accreditations. TPCs will also have to familiarize themselves with the rule and submit an 

51 application to the TSCA Title VI program (in the first year); reapply to the program (every 

52 twothree years); and submit notifications and reports and maintain records (every year). As 

53 shown in Table 1-3, TPCs that already have all accreditations in place will incur an estimated 

54 cost of $2,090 in the first year, $1,475 in reapplication years, and $983 in non-reapplication 

55 years. TPCs that need to obtain an additional accreditation will incur an estimated cost of 

56 $27,090 in the first year, $6,475 in reapplication years and $5,983 in non-reapplication years. 

57 

Table 1-3: Costs per TPC 

Type of Cost 

Cost (2010$) 

First Year Reapplication Years2 Non-Reapplication 

Years 

 Have 

Accred. 

Need 

Accred. 

Have 

Accred. 

Need 

Accred. 

Have 

Accred. 

Need 

Accred. 

Accreditation1 $0 $25,000 $0 $5,000 $0 $5,000 

Rule Familiarization $615 $615 $0 $0 $0 $0 

Application or Reapplication Process $492 $492 $492 $492 $0 $0 

Manufacturer Notification and Recordkeeping $773 $773 $773 $773 $773 $773 

Annual Report and Notifications of Changes $210 $210 $210 $210 $210 $210 

Cost per TPC $2,090 $27,090 $1,475 $6,475 $983 $5,983 

1

 Two-thirds of TPCs are assumed to be accredited for all three standards required by the rule (ISO/IEC Guide 65, 17020, and 

17025) and thus incur no cost for accreditation or reaccreditation. One-third of TPCs will need to become accredited (and 

maintain accreditation) for one additional standard at a cost of $25,000 in the first year and $5,000 per year in subsequent years. 2

 TPCs are required to reapply every three years. CARB TPCs are grandfathered in for the first year. 

58 

59 Nine TPCs in the U.S. are assumed to participate in the TSCA Title VI program. Six of 

60 them are assumed to already have all the necessary accreditations, while three are assumed to 

61 need to obtain and maintain an additional accreditation. As shown in Table 1-4, total annual 

62 costs to U.S. TPCs are estimated to be $93,810 in the first year, $28,275 per year in reapplication 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 3

63 years, and $23,847 per year in the remaining years. Total annualized costs are estimated at 

64 $27,917232 to $28,760123 per year, depending on the discount rate. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 4

65 

Table 1-4: Total Costs for U.S. TPCs 

Type of Cost 

Cost (2010$) 

First Year Reapplication Years2 Non-Reapplication 

Years 

 Have 

Accred. 

Need 

Accred. 

Have 

Accred. 

Need 

Accred. 

Have 

Accred. 

Need 

Accred. 

Cost per TPC $2,090 $27,090 $1,475 $6,475 $983 $5,983 

Number of U.S. TPCs 6 3 6 3 6 3 

Total Cost by Accreditation Status $12,540 $81,270 $8,850 $19,425 $5,898 $17,949 

Total Costs for U.S. TPCs $93,810 $28,275 $23,847 

Total Annualized Costs (30 years, 3%) $27,232 

Total Annualized Costs (30 years, 7%) $28,123 

1

 Two-thirds of TPCs are assumed to be accredited for all three standards required by the rule (ISO/IEC Guide 65, 17020, and 

17025) and thus incur no cost for accreditation or reaccreditation. One-third of TPCs will need to become accredited (and maintain 

accreditation) for one additional standard. 

2

 TPCs are required to reapply every three years. CARB TPCs are grandfathered in for the first year. 

66 

67 Table 1-5 summarizes the estimated costs attributable to the proposed rule. The 

68 estimated total cost is $107,290 in the first year. Total subsequent year costs range from $28,911 

69 to $36,835 depending on whether it is a reapplication year for ABs and TPCs. Annualized costs, 

70 calculated over a 30-year period at three and seven percent discount rates, are $34,12133,535 to 

71 $34,983443. 

72 

Table 1-5: Summary of Costs to U.S. Accreditation Bodies and TPCs (2010$) 

Type of Cost U.S. ABs 

U.S. TPCs All Affected U.S. 

Firms Have Necessary 

Accreditation 

Need Additional 

Accreditation 

Per Firm Costs: Year 1 $1,685 $2,090 $27,090 - 

Per Firm Costs: Subsequent Years $633 to $1,070 $983 to $1,475 $5,983 to $6,475 - 

Number of Affected Firms 8 6 3 17 

Total Year 1 Costs $13,480 $12,540 $81,270 $107,290 

Total Costs: Subsequent Years $5,064 to $8,560 $5,898 to $8,850 $17,949 to $19,425 $28,911 to $36,835

Total Annualized Costs (30-Years, 3 

percent discount rate) $6,303 $6,755 $20,477 $33,535 

Total Annualized Costs (30-Years, 7 

percent discount rate) $6,320 $6,706 $21,416 $34,443 

73 

74 The rule will affect an estimated nine small entities in the U.S. – four accreditation bodies 

75 and five TPCs. Some of the small entities are expected to be businesses, and others to be non76 profit organizations. The rule’s impacts on small entities are analyzed by determining the ratio 

77 of costs to revenues for small businesses, and the ratio of costs to expenses for small non-profit 

78 organizations. The cost impacts are then categorized as being under one percent, between one 

79 and three percent, and over three percent. 

80 

81 As shown in Table 1-6, there five small non-profits predicted to be affected by the rule, 

82 all of which are estimated to have cost impacts of less than one percent of expenses. Four small 

83 businesses are predicted to be affected by the rule; two of them are estimated to have cost 

84 impacts of less than one percent of revenues, and two are estimated to have cost impacts between 

85 one percent and three percent of revenues. No small entities are predicted to have cost impacts 

86 over three percent. 

87 
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August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 5

Table 1-6: Summary of Small Entity Impacts 

Entity Type Number of U.S. Entities 

that are Small 

Estimated Number of Small Entities with Impacts 

Under One 

Percent 

Between One and 

Three Percent 

Over Three Percent 

TPCs Non-profit 2 2 0 0 

Business 3 1 2 0 

ABs Non-profit 3 3 0 0 

Business 1 1 0 0 

Combined 

Non-profit 5 5 0 0 

Business 4 2 2 0 

Total 9 7 2 0 

88 

89 
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August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 6

90 2 Certification System 

91 

92 2.1 Certification System Framework 

93 

94 The certification system under the proposed TSCA Title VI TPC rule is based on a 

95 framework of international standards organizations and existing voluntary consensus standards, 

96 accreditation and inspection oversight organizations, accreditingaccreditation bodies, and third 

97 party certifiers, as described below. See Figure 1 for a diagrammatic approach to the 

98 relationships between the organizations in the certification system framework. 

99 

100 The certification system under the TSCA Title VI TPC rule will be similar, although 

101 not identical, to that under the California Air Resources Board’s (CARB) Air Toxics Control 

102 Measure (ATCM) to reduce formaldehyde emissions from composite wood products. Under the 

103 CARB ATCM, manufacturers of composite wood products must have their compliance with the 

104 emission standards verified by a TPC approved by CARB. The CARB ATCM requires TPCs to: 

105 verify that composite wood product manufacturers are complying with the quality assurance 

106 requirements; verify formaldehyde emission test results; work with manufacturers to establish 

107 quality control limits for each product type and production line; provide independent inspections 

108 and audits of manufacturers and records; use laboratories that are certified by an accreditation 

109 body that is a signatory to the International Laboratory Accreditation Cooperation Mutual 

110 Recognition Arrangement; and provide an annual report to CARB. In order to implement the 

111 ATCM, CARB directly evaluates and approves TPCs seeking to participate in the program. 

112 

113 2.1.1 International Standards Organizations 

114 

115 The International Organization for Standardization, known as ISO, is a non-governmental 

116 international standard-setting body comprising representatives from various national standards 

117 organizations. The organization promulgates worldwide proprietary industrial and commercial 

118 standards. The International Electrotechnical Commission (IEC) is a non-profit, non119 governmental international standards organization that prepares and publishes International 

120 Standards for electrical, electronic and related technologies. The IEC cooperates with the ISO 

121 when appropriate. The use of the ISO/IEC prefix covers publications from ISO/IEC Joint 

122 Technical Committee on Information Technology, as well as conformity assessment standards 

123 developed by ISO’s committee on conformity assessment (CASCO). 

124 

125 The ISO/IEC standards relevant to the TSCA Title VI TPC rule include ISO/IEC Guide 

126 65, which specifies requirements for bodies operating product certification systems; ISO/IEC 

127 17011, which specifies general requirements for accreditation bodies accrediting conformity 

128 assessment bodies; ISO/IEC 17020, which specifies requirements for competence of calibration 

129 and testing laboratories; and ISO/IEC 17025, which specifies the general requirements for 

130 laboratories to demonstrate they are competent to conduct testing and/or calibrations, including 

131 sampling. 

132 

133 2.1.2 Accreditation and Inspection Oversight Organizations 

134 
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August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 7

135 Accreditation and inspection oversight organizations ensure that their accreditation body 

136 members only accredit laboratories that are competent to do the work they undertake and are not 

137 subject to conflicts of interest. They also establish mutual recognition arrangements among 

138 accreditation bodies to ensure that the results from accredited laboratories will be accepted 

139 anywhere in the world. Examples of accreditation and inspection oversight organizations 

140 include the International Accreditation Forum, Inc. (IAF), and the International Laboratory 

141 Accreditation Cooperation (ILAC). 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 8

142 Figure 1. TSCA Tile VI Proposed Third-Party Certification Framework

143 

144 International Standards 

145 Organizations 

146 Develop consensus-based international 

147 standards for quality management 

148 and conformity assessment 

149 

150 

151 Accreditation and Inspection 

152 Oversight Organizations 

153 Ensure competency of AccreditingAccreditation 

154 Bodies and their conformance with 

155 international standards: 

156  Ensures AB conformance to 

ISO/IEC 170111 157 

158  Ensure ABs are qualified to oversee 

159 TPC conformance to ISO/IEC Guide 65 

160 ISO/IEC17020 and/or ISO/IEC 17025 

161 

162 

163 AccreditingAccreditation Bodies 

164 Ensure competency of TPCs; verify 

165 accuracy of emission test procedures; 

166 monitor quality assurance programs, audit 

167 and inspect TPCs and panel producers: 

168  Management systems conform to 

169 ISO/IEC 17011 

170  Ensure TPC conformance to 

171 applicable ISO/IEC Guides & Standards 

172 

173 

174 Third Party Certifiers 

175 Ensure that panel producers are in 

176 compliance with statutory 

177 formaldehyde emission standards: 

178  Management systems conform to 

179 ISO/IEC Guide 65 

180  Conform to applicable ISO/IEC 

181 Guides & Standards for 

182 Product & Laboratory Certification 

183 and Inspections 

184 

185 Composite Wood 

186 Product Panel Producer 

187 1 188 ISO/IEC 17011 – General Requirements for Accreditation Bodies Accrediting Conformity Assessment Bodies 2 189 MLA – IAF’s Multilateral Recognition Arrangement requires AB signatories to demonstrate they are capable of accrediting product certification 

190 bodies in conformance with ISO/IEC Guide 65 – General Requirements for Bodies Operating Product Certification Systems and ISO/IEC 17020 – 

191 General Criteria for the Operation of Various Types of Bodies Performing Inspection. 3 192 MRA – ILAC’s Mutual Recognition Arrangement requires AB signatories to demonstrate they are capable of accrediting testing laboratories in 

193 conformance with ISO/IEC 17025 – General Requirements for the Competence of Testing and Calibration Laboratories. 

194 

International Organization for 

Standardization (ISO) 

International Electrotechnical 

Commission (IEC) 

International Accreditation 

Forum, Inc (IAF) 

or equivalent organization 

 Ensures AB conformance to 

ISO/IEC 170111

 Require member ABs to be a 

signatory to MLA2

International Laboratory 

Accreditation Cooperation (ILAC) 

or equivalent organization 

 Ensures AB conformance to 

ISO/IEC 170111

 Require member ABs to be a 

signatory to MRA3

AB Type #3 

Product & Lab 

Accreditation Body 

 Recognition Agreement 

with EPA 

 Signatory to IAF MLA and 

ILAC MRA or equivalents 

 Ensure TPC conformance to 

ISO/IEC Guide 65, ISO/IEC 

17020 & ISO/IEC 17025

AB Type #2 

Laboratory 

Accreditation Body 

 Recognition Agreement 

with EPA 

 Signatory to ILAC MRA 

or equivalent 

 Ensure TPC conformance 

to ISO/IEC 17025 

AB Type #1 

Product 

Accreditation Body 

 Recognition Agreement 

with EPA 

 Signatory to IAF MLA or 

equivalent 

 Ensure TPC conformance 

to ISO/IEC Guide 65 & 

ISO/IEC 17020

TPC #2 

Accredited by AB #3 (acting as 

both Product AB & Lab AB) 

TPC #1 

Accredited by AB #1 (Product AB) 

& AB #2 (Lab AB) 

Panel Producer #4 

Certified by TPC #2 

Panel Producer #3 

Certified by TPC #2 

Panel Producer #2 

Certified by TPC #1 

Panel Producer #1 

Certified by TPC #1 
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August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 9

195 

196 2.1.3 Accreditation Bodies 

197 

198 An accreditation body (AB) is an organization that provides an impartial verification of 

199 the competency of a laboratory or TPC. In the context of formaldehyde and composite wood 

200 products, ABs ensure that TPCs can verify the accuracy of the emission test procedures used by 

201 composite wood product manufacturers to conduct formaldehyde emissions tests; monitor 

202 manufacturer quality assurance programs; and provide independent audits and inspections of 

203 manufacturers’ mills and testing facilities. There are ABs located throughout the world. ABs in 

204 the U.S. that are IAF or ILAC signatories include the AIHA Laboratory Accreditation Program 

205 (AIHA-LAP), the American Association for Laboratory Accreditation (A2LA), the American 

206 National Standards Institute (ANSI), Forensic Quality Services (FQS), the International 

207 Accreditation Service (IAS), the Laboratory Accreditation Bureau (L-A-B), the National 

208 Voluntary Laboratory Accreditation Program (NVLAP), and Perry Johnson Laboratory 

209 Accreditation, Inc. (PJLA). 

210 

211 The proposed TSCA Title VI TPC rule requires ABs to be either a signatory to IAF’s 

212 Multilateral Recognition Arrangement (MLA) or the equivalent for inspection and lab 

213 competency; ILAC’s Mutual Recognition Arrangement (MRA) or the equivalent for product 

214 certification competency; or both. An AB that is an IAF signatory is responsible for ensuring 

215 that the TPC is in conformity with ISO/IEC Guide 65 and ISO/IEC 17020. An AB that is an 

216 ILAC signatory is responsible for ensuring that a TPC is in conformity with ISO/IEC 17025. 

217 

218 Thus, TPCs will need to be accredited by two ABs unless their AB is a signatory to both 

219 ILAC and IAF (or equivalent oversight bodies). In the TSCA Title VI program, a Product AB is 

220 an organization that is a signatory to the IAF MLA or the equivalent, and that can verify the 

221 accuracy of the test procedures and facilities used by manufacturers to conduct tests, monitor 

222 manufacturer quality assurance and quality control programs, and provide audits and inspections. 

223 A Laboratory AB is an organization that is a signatory to the ILAC MRA, or the equivalent, and 

224 that is qualified to verify that testing and calibration laboratories can operate a quality 

225 management system, are technically competent, and are able to generate technically valid 

226 emissions results. 

227 

228 2.1.4 Third Party Certifiers 

229 

230 The third-party certifiers (TPCs) are responsible for activities such as regularly 

231 auditing manufacturers, conducting and verifying formaldehyde emissions tests, and ensuring 

232 that manufacturer quality assurance and quality control procedures and testing complies with 

233 TSCA Title VI TPC rule. Specific requirements include verifying that composite wood product 

234 manufacturers have adequate quality assurance controls and are complying with quality 

235 assurance and quality control requirements; verifying quality control test results compared with 

236 ASTM E-1333-96 test results by having laboratories conduct quarterly tests and evaluate test 

237 method equivalence; reviewing applications from manufacturers for reduced testing; working 

238 with manufacturers to establish quality control limits, and, if applicable, other limits for each 

239 product type and production line; informing manufacturers of criteria that will be used to 

240 determine if product lots are consistently exceeding the applicable quality control limit; 

241 inspecting and auditing manufacturers and their records at least quarterly; using a testing 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 10

242 laboratory or laboratories that comply with ISO/IEC 17025; certifying composite wood product 

243 types that comply with requirements under TSCA Title VI; following ISO/IEC Guide 65; 

244 following ISO/IEC 17020 in the carrying out of their inspections of the manufacturers; providing 

245 an approved TPC number (supplied by the accrediting AB) to the manufacturer for labeling and 

246 recordkeeping; and using laboratories that participate in an annual inter-laboratory comparison or 

247 proficiency testing program. 

248 

249 In the example shown in Figure 1, TPC #1 is accredited by two ABs: AB #1 (which is a 

250 signatory to the IAF MLA and acts as the Product AB) and AB #2 (which is a signatory to the 

251 ILAC MRA and acts a Laboratory AB). TPC #2 is accredited by a single AB, AB #3, which is a 

252 signatory to both the IAF MLA and the ILAC MRA and acts as both a Product AB and a 

253 Laboratory AB. 

254 

255 2.2 Profile of Third Party Certifiers and Accreditation Bodies 

256 

257 2.2.1 Third Party Certifiers 

258 

259 CARB has approved nine TPCs located in the U.S. (although most of these U.S. TPCs 

260 provide services internationally). Two of these TPCs are non-profit organizations, and the rest 

261 are businesses. Table 2-1 lists the domestic TPCs approved by CARB, their NAICS code, the 

262 type of organization, the sales volume or expenditures and the number of employees for the TPC 

263 or its parent organization, the U.S. Small Business Administration’s size threshold for the 

264 NAICS code, and the TPC’s small entity status. 

265 

266 This analysis assumes that 9 U.S. entities will act as TPCs under the TSCA Title VI 

267 program, and uses existing CARB TPCs as a proxy for their size and characteristics, but that 

268 does not mean that all of the CARB TPCs will become TPCs under Title VI. In reality, some of 

269 the CARB TPCs may choose not to participate in the federal program, and/or new entities may 

270 apply that are not part of the CARB program. 

271 

272 Size information was available for four of the nine U.S. TPCs, including the two non273 profits. The size of the TPCs ranges from a non-profit with 10 employees and $1.6 million in 

274 expenditures to a business with 2,500 employees in 125 offices with parent company that 

275 manages $3.1 billion in assets. 

276 

277 Under the Regulatory Flexibility Act (RFA), unless an agency establishes an alternate 

278 definition, the term “small organization” means any not-for-profit enterprise which is 

279 independently owned and operated and is not dominant in its field. The RFA does not provide 

280 any guidance on how to judge whether an organization is dominant in its field. Non-profit TPCs 

281 and accreditation bodies perform the same activities (such as conducting and verifying 

282 formaldehyde emissions tests, accrediting, and auditing) as their for-profit counterparts. In order 

283 to interpret the RFA criteria for small organizations and treat all affected entities consistently, 

284 this analysis determines the size status of non-profits by applying the SBA size thresholds for the 

285 NAICS codes the non-profits are classified in. 

286 

287 Based on the data in Table 2-1, the two U.S. TPCs that are non-profits are classified as 

288 small entities, and two of the businesses are classified as large. The size status for five CARB 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 11

289 TPCs could not be determined using the data in Table 2-1, so the small entity analysis in Section 

290 4.2 estimates a generic distribution of sizes based on Census data for the relevant NAICS codes. 

291 

292 TPCs come from a diverse set of industries – the six U.S.-based CARB TPCs for which 

293 Dun & Bradstreet listed an industry classification fall into five different NAICS codes. Thus, the 

294 firms that are likely to seek TPC accreditation may be very different from each other in terms of 

295 size, organization, and financial condition. Table 2-2 presents key industry summary statistics 

296 for these NAICS codes. However, the domestic TPCs approved by CARB represent a very small 

297 share of the 142,000 firms in these industries. And comparing Table 2-1 and Table 2-2, the 

298 CARB TPCs appear to be larger than the average firms in these industries. Thus, these Census 

299 statistics may not be representative of current CARB TPCs or potential new TSCA Title VI 

300 TPCs. 

301 

Table 2-1: CARB-Approved Third Party Certifiers Based in the U.S. 

Company Name NAICS 

code 

Organization 

Type 

Annual Sales 

Volume or 

Expenditures 1

(millions $) 

Total Employees 

SBA Size 

Threshold: 

Revenues ($ 

Millions) or 

Employees

Small Entity 

Status 

Certification Services 

International, LLC Unknown Unknown Unknown Unknown Unknown Unknown 

Composite Panel 

Association North 

America, Inc. (CPA) 

813910 Non-Profit $3.0 14 $7.0 Small 

Forestwood 

Industries, Inc. Unknown Unknown Unknown Unknown Unknown Unknown 

Hardwood Plywood 

and Veneer 

Association (HPVA) 

813910 Non-Profit $1.6 10 $7.0 Small 

NTA Incorporated 541330 Private 

Company $5.4 80 $4.5 Large 

PFS Corporation 

541611 Private 

Company Unknown 

According to 

company website, 

more than 100 

employees 

$7.0 Unknown 

Professional Service 

Industries, Inc. (PSI), 

owned by Olympus 

Partners Unknown Private 

Company 

Unknown, but 

Olympus Partners 

website reports 

they manage $3.1 

billion in assets. 

Unknown, but PSI 

website reports 

they have more 

than 2,500 

employees in 125 

offices 

Unknown 

Assumed to 

be large 

because of 

reported 

assets. 

Scientific 

Certification 

Systems (SCS) 

541380 Private 

Company Unknown SCS web site lists 

87 employees $12.0 Unknown 

TIMBERCO (dba 

TECO) 561990 Private Company Unknown 31 $7.0 Unknown 

1

 Annual sales volume is reported for businesses, and annual expenditures are reported for non-profits 

Sources: California Air Resources Board (CARB) 2011, Dun & Bradstreet 2011, U.S. Small Business Administration 2010 (size 

standards), and company web sites for data on their sales volume and employees (PSI 2012, PFS 2012, SCS 2012a and SCS 2012b) 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 12

302 

303 

Table 2-2: Industry Summary Statistics for NAICS Identified for U.S. Third Party Certifiers 

NAICS Firms 

Establishments Revenues 

($1000) 

Number of 

Employees 

Average 

Revenues 

per Firm 

($1000) 

Average 

Employees 

per Firm 

541330 - Engineering services 47,714 58,391 $187,531,866 977,031 $3,930 20 

541380 - Testing laboratories 5,288 6,549 $12,386,831 106,618 $2,342 20 

541611 - Administrative management 

consulting services 59,612 61,583 $67,994,053 351,829 $1,141 6 

561990 - All other support services 12,888 14,539 $20,897,346 195,544 $1,621 15 

813910 - Business associations 16,418 17,028 $22,482,137 116,055 $1,369 7 

Total 141,920 158,090 311,292,233 1,747,077 $2,193 12 

Note that TPCs could potentially be classified in additional NAICS as well; as a result, this list may not be comprehensive. 

Sources: U.S. Census Bureau 2010a; U.S. Census Bureau 2010b; U.S. Census Bureau 2010c; U.S. Census Bureau 2010d 

304 

305 Because Executive Order 12866, the Regulatory Flexibility Act, and the Unfunded 

306 Mandates Reform Act are all focused on entities located in the U.S., this analysis estimates costs 

307 and small entity impacts based on the expected number of domestic entities. But because the 

308 approval requirements for information collection requests under the Paperwork Reduction Act is 

309 not limited to U.S. entities, the reporting and recordkeeping burden of the rule is calculated for 

310 both foreign and domestic entities. Therefore, the analysis estimates the number of TPCs and 

311 ABs in other countries that are expected to participate in the Title VI program. 

312 

313 As shown in Table 2-3, there are a total of 27 CARB approved TPCs outside of the U.S., 

314 bringing the total number of CARB approved TPCs to 36. For the purpose of calculating 

315 reporting and recordkeeping burden under the Paperwork Reduction Act in Section 4.1, this 

316 analysis assumes that there will be 9 domestic and 27 foreign TPCs under the Title VI program, 

317 the same number as under the CARB program. 

318 

Table 2-3: CARB-Approved Third Party Certifiers by Country 

Country Where TPC is Located Number of TPCs 

Australia 1 

Austria 1 

Belgium 1 

China 5 

Czech Republic 1 

Denmark 1 

France 1 

Germany 4 

Hong Kong 3 

Indonesia 1 

Italy 3 

New Zealand 1 

Poland 1 

Spain 1 

Sweden 1 

Taiwan 1 

 Sub-total for TPCs outside the U.S. 27 

United States 9 

 Total 36 

Source: California Air Resources Board (CARB) 2011 

319 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 13

320 2.2.2 Accreditation Bodies 

321 

322 There are eight ABs in the U.S. that are currently IAF or ILAC signatories. Table 2-4 

323 lists thesethe domestic ABs, their NAICS code, the type of organization, the sales volume or 

324 expenditures and the number of employees for the AB or its parent organization, the U.S. Small 

325 Business Administration’s size threshold for the NAICS code, and the AB’s small entity status. 

326 It is not known which of these organizations accredit CARB TPCs for one or more of the 

327 relevant ISO/IEC standards (Guide 65, 17020, or 17025).

328 

329 This analysis assumes that 8 U.S. ABs will participate in the TSCA Title VI program, and 

330 uses the characteristics of the ABs in Table 2-4 as proxies to estimate the impacts of the rule. 

331 This assumption may overestimate the number of affected entities, because some ABs that are 

IAF or ILAC signatories may not choose to participate in the TSCA Title VI program.1 332 And it is 

333 unlikely that additional bodies will become signatories as a result of the TSCA Title VI TPC 

334 rule, because becoming a signatory to IAF, ILAC, or an equivalent organization is a time335 intensive process that may take up to a year to complete (Personal Communication with IAS 

336 2011). 

337 

338 Five of the domestic ABs that are IAF or ILAC signatories are non-profit organizations, 

339 so this analysis assumes that five similarly sized non-profit ABs will participate in the TSCA 

340 Title VI program. Under the Regulatory Flexibility Act (RFA), unless an agency establishes an 

341 alternate definition, the term “small organization” means any not-for-profit enterprise which is 

342 independently owned and operated and is not dominant in its field. The RFA does not provide 

343 any guidance on how to judge whether an organization is dominant in its field. Non-profit TPCs 

344 and accreditation bodies perform the same activities (such as conducting and verifying 

345 formaldehyde emissions tests, accrediting, and auditing) as their for-profit counterparts. In order 

346 to interpret the RFA criteria for small organizations and treat all affected entities consistently, 

347 this analysis determines the size status of non-profits by applying the SBA size thresholds for the 

348 NAICS codes the non-profits are classified in. This results in an estimate that three small non349 profits and one small business will participate in the TSCA Title VI program as ABs. 

350 

 1

 For example, Forensic Quality Services does not appear to accredit any labs providing product or environmental testing, 

and states that its mission is “to provide training, education, quality assurance management and accreditation for 

providers of forensic science testing services to federal, state and local law enforcement agencies” (IRS 2010). So FQS 

seems unlikely to serve as an accreditation body for TPCs testing formaldehyde from composite wood products. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 14

Table 2-4: U.S. Accreditation Bodies that are IAF or ILAC Signatories 

Company Name NAICS 

code 

Organization Type

Sales Volume / 

Expenditures 

($ Millions)1

Total 

Employees 

SBA Size 

Threshold: 

Revenues 

($ Millions) or 

Employees 

Small 

Entity 

Status 

AIHA Laboratory Accreditation 

Programs, LLC 2 561990 Non-Profit $14.9 63 $7.0 Large 

American Association For 

Laboratory Accreditation 813920 Non-Profit $10.6 48 $14.0 Small 

American National Standards 

Institute (ANSI) 813910 Non-Profit $31.3 122 $7.0 Large 

Forensic Quality Services, Inc. 541990 Non-Profit $0.6 4 $7.0 Small 

International Accreditation 

Service (IAS) 813319 Non-Profit $2.5 54 $7.0 Small 

Laboratory Accreditation 

Bureau 541712 Private Company $0.4 6 500 employees Small 

National Voluntary Laboratory 

Accreditation Program 

(NVLAP), operated by the 

National Institute of Standards 

and Technology (NIST) 

- Federal 

Government - - - Large 

Perry Johnson Laboratory 

Accreditation Inc.3 541618 Private 

Company $17.0 147 $7.0 Large 

Notes: 1. Sales volume data are presented for businesses. Expenditure data are presented for non-profits. 

2. Size data for AIHA Laboratory Accreditation Programs, LLC is based on the size of the parent organization, the American 

Industrial Hygiene Association (AIHA). 

3. Sales volume and employee size data for Perry Johnson Laboratory Accreditation Inc. include D&B sales and employee data 

for "Perry Johnson Laboratory Accreditation" and the American Business Directory sales data for the related companies "Perry 

Johnson Inc" and "Perry Johnson Registrars".

Sources: American Business Directory 2011 (sales and employee data for Perry Johnson Inc. and Perry Johnson Registrars), 

Dun & Bradstreet 2011 (business sales volumes and employee data and NAICS codes for all entities), U.S. Internal Revenue 

Service 2009, 2010 (non-profit expenditures and employees), U.S. Small Business Administration 2010 (size standards), and 

company web sites for AIHA and Perry Johnson for relationships among entities in their family tree (AIHA-LAP LLC 2012, 

Perry Johnson & Associates 2012). 

351 

352 Table 2-5 lists the foreign countries with CARB-approved TPCs, the ILAC or IAF 

353 signatory ABs in that country, and their status as signatories for ISO/IEC Guide 65, 17020, and 

354 17025. It is not known which ABs these CARB-approved TPCs use. However, every country 

355 with a CARB approved TPC also has an AB that is an IAF or ILAC signatory, and most of the 

356 ABs are signatories to all three relevant ISO/IEC standards. The exceptions are Australia, New 

357 Zealand, and Hong Kong, each of which lacks an AB that is a signatory for ISO/IEC Guide 65. 

358 However, there is a joint AB for Australia and New Zealand that is a signatory for ISO/IEC 

359 Guide 65, and there is an AB in China that is a signatory for ISO/IEC Guide 65. Therefore, each 

360 foreign TPC could use a local AB for the TSCA Title VI program. 

361 

362 There are a total of 17 ABs shown in Table 2-5 that are IAF or ILAC signatories and are 

363 located in foreign countries with CARB-approved TPCs. While EPA does not know whether 

364 these ABs accredit CARB TPCs or whether some CARB TPCs use ABs located outside their 

365 own country, for the purpose of calculating reporting and recordkeeping burdens under the 

366 Paperwork Reduction Act, the analysis in Section 4.1 assumes that there will be 17 foreign ABs 

367 that participate in the TSCA Title VI program. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 15

368 

Table 2-5: Summary of IAF or ILAC Signatory Accreditation Bodies in Foreign Countries with 

CARB TPCs 

Country 

Number of 

CARB-approved 

TPCs in 

Country Accreditation Body 

ISO/IEC 

Guide 65 

ISO/IEC 

17020 

ISO/IEC 

17025 

1. Australia 1 

National Association of Testing 

Authorities, Australia (NATA) X X 

2. Australia and 

New Zealand 

Joint Accreditation System of Australia 

and New Zealand (JAS-ANZ) X 

3. Austria 1 

Bundesministerium fur Wirtschaft, 

Familie und Jugend (BMWA) X X X 

4. Belgium 1 

Belgian Accreditation Structure 

(BELAC) X X X 

5. China 5 

China National Accreditation Service for

Conformity Assessment (CNAS) X X X 

6. Czech 

Republic 1 Czech Accreditation Institute (CAI) X X X 

7. Denmark 1 Danish Accreditation (DANAK) X X X 

8. France 1 

Comite Francais d’Accreditation 

(COFRAC) X X X 

9. Germany 4 

Deutsche Akkreditierungsstelle GmbH 

(DakkS) X X X 

10. Hong Kong 3 

Hong Kong Accreditation Service 

(HKAS) X X 

11. Indonesia 1 

National Accreditation Body of Indonesia

(KAN) X X X 

12. Italy 3 

Sistema Italiano di Accreditamento 

(ACCREDIA) X X X 

13. New Zealand 1 

International Accreditation New Zealand 

(IANZ) X X 

14. Poland 1 Polish Centre for Accreditation (PCA) X X X 

15. Spain 1 

Entidad Nacional de Acreditacion 

(ENAC) X X X 

16. Sweden 1 

Swedish Board for Accreditation and 

Conformity Assessment (SWEDAC) X X X 

17. Taiwan 1 Taiwan Accreditation Foundation (TAF) X X X 

Result: there are a total of 17 ABs that are IAF or ILAC signatories in foreign countries with CARB-approved TPCs 

Sources: IAF 2011; ILAC 2011; CARB 2011. 

369 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 16

370 3 Costs of the TSCA Title VI TPC Rule 

371 

372 This section describes the proposed regulatory requirements for accreditation bodies and 

373 TPCs and presents the estimated costs for obtaining and maintaining accreditation. 

374 

375 3.1 Proposed Rule Requirements 

376 

377 EPA is proposing to administer the TPC program by developing recognition agreements 

378 with accreditation bodies. The ABs would then process TPC applications and oversee the TPCs. 

379 

380 3.1.1 Requirements for Accreditation Bodies 

381 

382 As described in Section 2.1, the proposed rule would require ABs to be either a signatory 

383 to the International Laboratory Accreditation Cooperation (ILAC) Mutual Recognition 

384 Arrangement (MRA) or the equivalent for inspection and lab competency, the International 

385 Accreditation Forum, Inc. (IAF) Multilateral Recognition Arrangement (MLA) or the equivalent 

386 for product certification competency, or both. EPA would also require that ABs: 

387 

388  Conform with ISO/IEC 17011, which lists the basic criteria for an international 

accreditingaccreditation body who reviews and audits the TPC2 389 ; 

390  Submit an application to enter into a recognition agreement with EPA. The 

391 application would include their contact information; documentation of their IAF 

392 MLA, ILAC MRA, or equivalent signatory status; and a description of any other 

393 qualifications related to performing product or laboratory accreditation. The 

394 recognition agreement would need to be renewed every three years; 

395  Notify EPA in the following instances: loss of signatory status; TPC application; TPC 

396 accreditation; TPC compliance failure; organization policy or management structure 

397 changes that could adversely affect accreditation program; and with checklists and 

398 other records documenting compliance with systems audits and on-site assessments; 

399  Notify TPCs if the AB withdraws or is removed from the program; 

400  Maintain records documenting TPC accreditation applications, and checklists and 

401 other records documenting compliance with systems audits and on-site assessments. 

402 Applications must be retained for a minimum of fivethree years from the date that the 

403 TPC’s accreditation terminatesthey were submitted; and 

404  Provide an annual report to EPA with the number of TPC applications received; the 

405 number of TPCs approved and denied; the names and contact information of all 

406 accredited TPCs; the number and locations of systems audits and on-site assessments; 

407 and the results of accredited TPC proficiency testing and inter-laboratory 

408 comparisons. 

409 

410 3.1.2 Requirements for TPCS 

411 

 2

 In order to become an IAF or ILAC signatory, an AB is reviewed by its peers to ensure that it is in compliance with 

ISO/IEC 17011, as well as to verify that it is qualified to ensure TPC compliance with other voluntary consensus 

standards. Therefore, it is assumed that IAF or ILAC signatories are already in conformance with ISO/IEC 17011, and 

would not incur additional costs for conformance as a result of this rule. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 17

412 The proposed rule would require that TPCs: 

413 

414  Conform to ISO/IEC Guide 65 (general requirements for bodies operation product 

415 certification systems) and ISO/IEC 17020 (general criteria for the operation of 

416 various types of bodies performing inspection); 

417  Use a laboratory that conforms to ISO/IEC 17025 (requirements for competence of

418 calibration and testing laboratories); and 

419  Be qualified to administer the approved formaldehyde test methods they will be 

420 using. 

421 

422 EPA would also require the following recordkeeping and reporting activities for TPCs: 

423 

424  Submit an application to the Product accreditation body every twothree years with 

425 domestic contact information; type of composite wood product(s) intended to be 

426 certified; and a description of experience with ISO/IEC Guide 65, ISO/IEC 17020, 

427 and the product(s) the intended to be certified; 

428  Submit an application to the Laboratory accreditation body every twothree years with 

429 domestic contact information; and a description of experience with test method 

430 ASTM E-1333-96 and in evaluating correlation between tests, performing 

431 formaldehyde tests on composite wood products, and operating or using laboratories 

432 that comply with ISO/IEC 17025; 

433  Maintain records for fivethree years that document the certified manufacturers and 

434 products, including those approved for reduced testing; the results of inspections, 

435 audits, and emissions tests; the laboratories and tests used; and the methods and 

436 results for establishing test method correlations; 

437  Provide an annual report to its accreditingaccreditation body or bodies with a list of 

438 manufacturers and products certified during the previous year; a list of non439 complying products or events; a list of laboratories and tests used by the TPC; and the 

440 results of inter-laboratory comparison or proficiency tests for laboratories used by the 

441 TPC; and 

442  Inform accreditation body or bodies within 30 days of any changes in personnel 

443 qualifications, procedures, or laboratories used by the TPC. 

444 

445 3.2 Wage Rates Used in the Analysis 

446 

447 The proposed rule involves activities that may require efforts by employees in three labor 

448 classifications: managerial, technical, and clerical. Costs for each activity are calculated by 

449 estimating the labor hours required in each labor category and multiplying those burdens by the 

450 wage rate for each labor category. This section summarizes the estimated wage rate in each 

451 labor category. Additional details are provided in Appendix A. 

452 

453 Loaded wage rates for managerial, technical, and clerical personnel are derived by 

454 combining data on wages and fringe benefits with estimates of overhead rates, following the 

455 methodology described in “Wage Rates for Economic Analysis of the Toxics Release Inventory 

456 Program” (EPA, 2002b). Wage data for each labor category are provided by the Employer Costs 

457 for Employee Compensation (ECEC) Supplemental Tables available on the BLS website (U.S. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 18

458 Bureau of Labor Statistics (BLS) 2011). The loaded wage rate for managerial labor is $66.78; 

459 for technical labor, $56.31; and for clerical labor, $25.65. Table 3-1 presents the basic data used 

460 to calculate the loaded wage rates for all three categories of labor. 

Table 3-1: Loaded Industry Wage Rates, 2010$ 

Labor Category 

B

ase Wages

Fringe 

benefits + overhead 

factor 

Loa

ded Wages 

Managerial $42.42a 1.57b,c $66.78 

Professional/ 

Technical $36.57a 1.54b,c $56.31 

Clerical $16.72a 1.53b,c $25.65 

Notes: 

a Base wages are estimated in the ECEC Supplemental Tables (U.S. Bureau of Labor Statistics (BLS) 2011). b Fringe benefits are estimated in the ECEC Supplemental Tables (U.S. Bureau of Labor Statistics (BLS) 

2011). 

c An overhead rate of 17% of base wages is used here, based on methodology and assumptions in U.S. 

Environmental Protection Agency (EPA) 2002a, b. 

Source:U.S. Bureau of Labor Statistics (BLS) 2011, U.S. Environmental Protection Agency (EPA) 2002a, b. 

461 

462 3.3 Costs to Accreditation Bodies 

463 

464 The proposed TSCA Title VI TPC rule requires accreditation bodies to be signatories to 

465 IAF, ILAC or equivalent oversight bodies. The process of becoming a signatory is time466 intensive and may take up to a year to complete, so it is unlikely that additional bodies will 

467 become signatories as a result of the TSCA Title VI TPC rule (Personal Communication with 

468 IAS 2011). Thus, costs are estimated assuming that only existing IAF and ILAC signatories will 

469 serve as accreditingaccreditation bodies for the third-party certifiers under this regulation. 

470 Therefore, the estimated incremental costs to the accreditingaccreditation bodies related to the 

471 proposed rule will include: 

472 

473 1. Rule Familiarization: Reading the rule in order to understand the requirements; 

474 2. Application Submission: Submitting an application to enter into a recognition 

475 agreement with EPA; 

476 3. Prepare Recognition Agreement: If the application is approved, enter into a 

477 recognition agreement with EPA; 

478 4. EPA Notification: Provide EPA with notifications in the following instances: 

479 loss of signatory status; TPC application; TPC accreditation; TPC compliance 

480 failure; organization policy or management structure changes that could adversely 

481 affect accreditation program; and provide checklists and other records 

482 documenting compliance with systems audits and on-site assessments; 

483 5. TPC Notification: Provide TPCs with notifications if the AB withdraws or is 

484 removed from the program; 

485 6. Recordkeeping: Maintain records documenting TPC accreditation applications, 

486 and checklists and other records documenting compliance with systems audits and 

487 on-site assessments. Applications must be retained for a minimum of fivethree

488 years from the date that the TPC’s accreditation terminatesthey were submitted; 

489 and 

490 7. Reporting: Provide an annual report to EPA with the number of TPC 

491 applications received; the number of TPCs approved and denied; the names and 

492 contact information of all accredited TPCs; the number and locations of systems 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 19

493 audits and on-site assessments; and the results of accredited TPC proficiency 

494 testing and inter-laboratory comparisons. 

495 

496 Accreditation bodies are required to renew their recognition agreement with EPA every 

497 three years. This analysis assumes that accreditation bodies incur application submission and 

498 recognition agreement preparation costs in the first year and subsequently every three years 

499 thereafter. Costs associated with EPA notification, TPC notification, recordkeeping and 

500 reporting are assumed to be incurred annually. Rule familiarization is a one-time cost incurred in 

501 the first year. As a result, accreditation bodies are expected to incur costs of $1,685 in the first 

502 year, $1,070 in reapplication years, and $633 in the non-reapplication years, as summarized below in 

503 Table 3-2 and described in more detail in Appendix B (see Table B-1 and Table B-3). This analysis 

504 assumes that eight organizations in the U.S. will become accreditation bodies, resulting in estimated total 

505 annualized costs of $6,204303 per year at a three percent discount rate, and $6,222320 per year at 

506 a seven percent discount rate. 

507 

Table 3-2: Costs for Accreditation Bodies 

Type of Cost Cost (2010$) 1

First Year Reapplication Years 2 Non-Reapplication Years 3

Rule Familiarization $615 $0 $0 

Application or Reapplication Process 1 $88 $88 $0 

Prepare Recognition Agreement $349 $349 $0 

EPA Notification $57 $57 $57 

TPC Notification $12 $12 $12 

Recordkeeping $308 $308 $308 

Reporting $256 $256 $256 

Cost per Accreditation Body $1,685 $1,070 $633 

Number of U.S. Accreditation Bodies 8 8 8 

Total Costs for U.S. Accreditation Bodies $13,480 $8,560 $5,064 

Total Annualized Costs (30 years, 3%) 4 $6,303 

Total Annualized Costs (30 years, 7%) 4 $6,320 

Notes: 

1 See Table B-1 and Table B-3 for detailed description of these estimates. 2

 Under the proposed rule, accreditation bodies are required to reapply every three years. Reapplication is assumed to occur at the 

end of years 3, 6, 9, 12, 15, 18, 21, 24, 27, and 30. 

3

 Non-reapplication years are years 2, 4, 5, 7, 8, 10, 11, 13, 14, 16, 17, 19, 20, 22, 23, 25, 26, 28, and 29. 4 Costs are annualized over thirty years for 3 and 7 percent discount rates using the following formula: 

(present discounted value of 30-year stream-of-costs)*(discount rate*(1+ discount rate)30)/((1+ discount rate)31-1). Rule 

familiarization, application costs, and recognition agreement costs are assumed to be incurred immediately and therefore are not 

discounted. Other costs are discounted assuming that they are incurred at the end of each year. 

508 

509 EPA is considering requiring accreditation bodies to submit their notifications and reports 

510 to the Agency electronically using the Central Data Exchange (CDX). Appendix C discusses the 

511 incremental change in costs if EPA finalizes a mandatory electronic reporting requirement. As 

512 shown in section C.1.4, the total annualized savings to U.S. accreditation bodies would be $1,193

513 per year at a 3 percent discount rate, and $1,146 per year at a 7 percent discount rate. 

514 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 20

515 3.4 Third-Party Certifier Costs 

516 

517 Costs that TPCs may incur under the proposed rule can be classified into five categories: 

518 (1) the cost of rule familiarization, (2) the cost of applying to the accreditation body in order to 

519 participate in the TSCA Title VI program, (3) the cost to obtain and maintain any necessary 

520 accreditations that the TPC does not already have, (4) the annual cost of providing notifications 

521 to manufacturers and of maintaining records, and (5) the cost of providing an annual report and 

522 other notifications to the AB or EPA. To the extent that requirements in the TSCA Title VI rule 

523 are similar to requirements in the CARB rule, CARB-approved TPCs will incur relatively little 

524 additional cost to comply with EPA’s rule. 

525 

526 Under the proposed rule, TPCs are required to apply for re-accreditation every twothree

527 years. As a result, application and accreditation costs are incurred every otherthird year. The 

528 costs associated with notifications, maintaining records, and providing an annual report are 

529 assumed to be incurred on an annual basis. Rule familiarization is a one-time cost incurred in the 

530 first year. Each of these types of costs is discussed in more detail in the subsections below. 

531 

532 3.4.1 TPC Rule Familiarization 

533 

534 The level of effort associated with rule familiarization was estimated based on 

535 professional judgment, and burden hours were multiplied by the corresponding labor category’s 

536 wage rate as derived in Section 3.2 (U.S. Bureau of Labor Statistics (BLS) 2011) to estimate 

537 costs. As shown in Table 3-3 below, the total cost for each firm is estimated to be $615 in the 

538 first year. 

539 

Table 3-3: Application Process Burden and Costs for TPCs, by Activity 

Activity 

Clerical 

Burden/Cost 

Technical 

Burden/Cost 

Managerial 

Burden/Cost Total 

(hours)1 (2010$) (hours)1 (2010$) (hours)1 (2010$) (hours)1 (2010$) 

(a) (b) (c) (d) (e) (f) (g)=(a)+(c)+(e) (h)=(b)+(d)+(f) 

Rule Familiarization 0.00 $0.00 5.00 $281.55 5.00 $333.90 10.00 $615 

Notes: 1. Burden hours are based on best professional judgment. 

540 

541 3.4.2 TPC Application Process 

542 

543 The application process for TPCs includes completing a form with standard information 

544 about the firm and also describing the firms experience with the ISO/IEC standards. The level of 

545 effort for these elements were estimated based on prior economic analyses ((EPA 2011a), and 

546 burden hours were multiplied by the corresponding labor category’s wage rate as derived in 

547 Section 3.2 (U.S. Bureau of Labor Statistics (BLS) 2011) to estimate costs. As shown in Table 

548 3-4 below, the total application cost for each firm is estimated to be $492 in reapplication years 

549 and $0 in non-reapplication years. For more information, see Appendix B. 

550 

551 A TPC must reapply every twothree years in order to participate in the TSCA Title VI 

552 program. TPCs that are approved by CARB will be grandfathered under the TSCA Title VI rule 

553 for one year, provided that they are compliant with all other aspects of the TSCA Title VI rule. 

554 To simplify the analysis, costs are calculated as though all Title VI TPCs are grandfathered in for 

555 one year, even though some of them may not have been approved by CARB. Thus, costs are 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 21

556 calculated assuming that reapplication occurs every otherthird year starting three years after the 

557 rule is promulgated (i.e., in years 3, 54, 7, 910, etc.).
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 22Table 3-4: Application Process Burden and Costs for TPCs, by Activity 

Activity 

Clerical Burden/Cost Technical Burden/Cost Managerial Burden/Cost 

(hours) 

(a) 

(2010$)1

(b) 

(hours) 

(c) 

(2010$)1

(d) 

(hours) 

(e) 

(2010$)1

(f) 

(h

(g)=(a

Product Accreditation Body Application Submission Company Information (Name, Address, Telephone Number, and Email Address of Primary Contact) and Type of Composite Wood Products Applicant Intends to Certify2

0 $0.00 0.04 $2.25 0.02 $1.34 

Description of TPC's Experience or Ability in Product Certification and Complying with ISO/IEC Guide 653

0 $0.00 0.83 $46.74 0.51 $34.06 

Description of TPC's Experience in the Composite Wood Product Industry with the Product(s) Intended to be Certified3

0 $0.00 0.83 $46.74 0.51 $34.06 

Description of TPC's Ability to Inspect and Properly Train and Supervise Inspectors Pursuant to ISO/IEC 170203

0 $0.00 0.83 $46.74 0.51 $34.06 

Laboratory Accreditation Body Application SubmissionCompany Information (Name, Address, Telephone Number, and Email Address of Primary Contact; if foreign, name and address of an agent for service located in the U.S.)2

0 $0.00 0.04 $2.25 0.02 $1.34 

Description of TPC's Experience in Performing or Verifying Formaldehyde Testing on Composite Wood Products3

0 $0.00 0.83 $46.74 0.51 $34.06 

Description of TPC's Experience Operating or Using Laboratories that Comply with ISO/IEC 170253

0 $0.00 0.83 $46.74 0.51 $34.06 

Description of TPC's Experience with Test Method ASTM E-1333-96 (2002) and Experience Evaluating Correlation between Test Methods3

0 $0.00 0.83 $46.74 0.51 $34.06 

TOTAL – REAPPLICATION YEARS 0.00 $0.00 5.06 $284.93 3.10 $207.02 

TOTAL – NON-REAPPLICATION YEARS 0.00 $0.00 0.00 $0.00 0.00 $0.00 

Notes: 1. Note that under the proposed rule, TPCs are required to apply for re-accreditation every three years. As a result, reapplication costs are incu

2. Based on the estimated burden associated with reporting “company information” (EPA 2011a). 3. Based on the estimated burden associated with answering substantiation questions when making plant site confidentiality claims (EPA 2011a). Source: EPA 2011a

558 
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August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 23

559 3.4.3 TPCs Obtaining Accreditation for the Required Standards 

560 

561 Through a series of telephone interviews, representatives from six laboratoriesTPCs that 

562 have been approved by CARB for formaldehyde testing provided information about the 

563 accreditations they already had, and the costs of receiving and maintaining the accreditation. 

564 Several laboratoriesTPCs also spoke in general terms about the costs of accreditation. The 

565 information collected from each laboratoryTPC is included in Table 3-5. 

566 

567 As indicated in Table 3-5, the cost to TPCs of obtaining accreditation will depend on 

568 whether they have the systems and equipment in place to satisfy the accreditation requirements 

569 or whether they will have to establish these. Based on the telephone interviews, the initial cost 

570 of obtaining a single accreditation is about $20,000 to $30,000 for each quality system. This 

571 analysis uses the mid-point of the range, $25,000, as the cost estimate. The cost would be about 

572 three times that if the firm needed to be newly accredited for all three relevant ISO/IEC standards 

573 (Guide 65, 17020, and 17025). Based on discussions with the six TPCs, the analysis assumes 

574 that two-thirds of the CARB-certified TPCs will already have all three accreditations in place 

575 and that one-third will need to obtain one additional accreditation from an AB. As a result, this 

576 analysis assumes that one-third of TPCs will incur a cost of $25,000 to obtain one additional 

577 accreditation, while two-thirds of TPCs will not incur any additional costs associated with 

578 obtaining additional accreditations. 

579 

580 In addition to obtaining the initial accreditation, the TPCs will need to maintain and 

581 renew their systems and testing certifications. (A typical accreditation lasts for two years.) Two 

582 of the six TPCs provided information on the cost of maintaining and renewing accreditations. 

583 They reported costs that ranged from $5,000 to $15,000 per year associated with maintaining 

584 certification, such as paying audit fees to their AB. Note that the systems and testing 

585 certifications for which the laboratories reported costs may cover more than the specific 

586 formaldehyde testing. Therefore, these estimates may overstate costs if the labs would incur 

587 these costs even if they were not acting as TPCs under TSCA Title VI. Because the audits 

588 include tests other than formaldehyde, this analysis uses $5,000 (the low end of the costs 

589 reported) as the annual reaccreditation cost for TPCs that need an additional accreditation. 

590 

591 As discussed above, based on discussions with the six TPCs, the analysis assumes that 

592 two-thirds of the CARB-certified TPCs will already be maintaining all three of the relevant 

593 accreditations (i.e., ISO/IEC Guide 65, 17020, and 17025) and that one-third of TPCs will need 

594 to maintain a single additional accreditation in order to participate in the TSCA Title VI 

595 program. Thus, one-third of TPCs are assumed to incur an annual cost of $5,000 per year in 

596 subsequent years for maintaining one additional accreditation, while two-thirds of TPCs will not 

597 incur any additional costs associated with maintaining additional accreditations because they 

598 were already maintaining all of the necessary accreditations in the baseline. 

599 

600 In interviews with TPCs, three said they had excess capacity for additional testing and 

601 two said they could easily add extra capacity either by building additional chambers or 

602 subcontracting the work to accredited laboratories. For example, one said that while they 

603 currently have 3 small chambers, within two months they could add 25 small chambers that 

604 would allow them to do 100 tests per day. In addition, it would be possible to add large chamber 

605 capacity within a 3-6 month period. The firms indicated that if the new equipment added were 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 24

606 similar to what they already had in place, their accreditingaccreditation body would allow for 

607 desk audit approval (which could be done quickly, instead of requiring a site visit prior to 

608 approval, which would take more time). Therefore, this analysis assumes there is adequate 

609 existing testing capacity, and that no additional costs for adding additional testing capacity will 

610 be incurred. 

611 

Table 3-5: CARB TPCs Estimates of Previous Accreditation Costs 

TPC Estimated Cost of Accreditation Other Information 

NSF International 1 About $5,000 for application process and 

between $5,000 for approval of 10 test 

processes to $20,000 for approval of 100 test 

processes. (The tests are grouped in 

disciplines and priced for each discipline. For 

this conversation the representative was 

discussing batteries of tests, for example toys 

have 10 tests.) 

Estimated that it would cost about $10,000 every 

two years to get reaccredited (or $5,000 a year 

average). 

PSI, Inc. $5,000 to $6,000 if laboratory has 

accreditations, inspections, testing and quality 

systems in place. Estimated $50,000 to 

$60,000 to develop the accreditations, 

inspections, testing and quality systems if they 

are not in place. 

SCS International Estimated it cost about $9,000 to $15,000 to 

write manual and complete application. SCS 

already had the quality system in place. 

Mentioned that CARB does not require ISO 

accreditation as long as the laboratory has 

demonstrated ISO equivalence. Getting ISO 

accreditation is expensive ($25,000). They do not 

have a lab but contract the testing portion out to 

labs that are ISO 17025 accredited. 

NTA Incorporated Estimated it cost $10,000 to set up their 

CARB accredited program. They were 

already an ISO product certification firm. 

Forestwood Industries, 

Inc 

For CARB, they needed ISO 17020 and 

Guide 65 which they did not have. Each cost 

between $20,000 and $30,000 to get. The 

application took one day to complete but 

gathering the information took longer. 

PFS Corporation PFS is a product testing laboratory and had 

IAS approval for testing formaldehyde. The 

cost of a new accreditation is at least $2,550 

with $800 for additional fields of testing 

(formaldehyde could be considered a field) 

and another $250 for each facility. 

It costs PFS about $15,000 to get an IAS on-site 

audit each year although the audit includes more 

than formaldehyde. The cost for a desk audit to 

add an additional small test chamber where 

existing small chambers have already been 

approved is $600, but it costs at least $2,000 for a 

standard inspection audit. 1

NSF International was approved as a TPC by CARB, but has subsequently withdrawn from the program. 

Sources: Personal Communication with Forestwood Industries 2011, Personal Communication with NSF International 2011a, b, 

Personal Communication with NTA Inc. 2011, Personal Communication with PFS Corporation 2011, Personal Communication 

with PSI 2011, Personal Communication with SCS International 2011. 

612 
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August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 25

613 3.4.4 Annual Cost of TPCs Notifications Relating to Manufacturers 

614 

615 Under the proposed rule, TPCs would have to provide its third-party certifier number to 

616 any manufacturer receiving its TSCA Title VI certification services. And should a TPC 

617 withdraw from the program or lose its accreditation, it would be required to notify all 

618 manufacturers that receive its TSCA Title VI certification services. 

619 

620 Upon request, TPCs must provide EPA with a list of the manufacturers and their product 

621 types certified, the results of inspections, audits, and emission tests conducted for each 

622 manufacturer and product type, the list of the TPCs laboratories, test methods, and test results, 

623 the methods and results for establishing test method correlations and equivalence and the list of 

624 manufacturers and products approved for reduced testing. As shown in Table 3-6 below, the 

625 sum of these costs is approximately $773 per firm per year in all years. For more information, 

626 see Appendix B. 

627 

628 

629 
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August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 26

630 

Table 3-6: Annual Burden and Cost to TPCs of Notifications Relating to Manufacturers, by Activity 

Activity 

Clerical Burden/Cost Technical Burden/Cost Managerial Burden/Cost 

(hours) 

(a) 

(2010$) 

(b) 

(hours) 

(c) 

(2010$) 

(d) 

(hours) 

(e) 

(2010$) 

(f) 

(h

(g)=(a

Notifications to EPA Third Party Certifier Number1 0 $0.00 0.04 $2.25 0.02 $1.34 Withdraw from Program or Lose Accreditation1 0 $0.00 0.01 $0.56 0.005 $0.33 Recordkeeping and Reporting to EPAList of Manufacturers and their Product Types (including Resins Used) Certified by TPC2 0.75 $19.24 1.5 $84.47 0.75 $50.09 Results of Inspections, Audits, and Emission Tests Conducted for Each Manufacturer and Product Type2

0.75 $19.24 1.5 $84.47 0.75 $50.09 

List of the TPC's Laboratories, Test Methods (including Test Conditions and Conditioning Time), and Test Results2

0.75 $19.24 1.5 $84.47 0.75 $50.09 

Methods and Results for Establishing Test Method Correlations and Equivalence2 0.75 $19.24 1.5 $84.47 0.75 $50.09 List of Manufacturers and Products Approved for Reduced Testing2 0.75 $19.24 1.5 $84.47 0.75 $50.09 

TOTAL 3.75 $96.20 7.55 $425.14 3.775 $252.09 

Notes: 1. Based on best professional judgment and rule requirements. 2. Based on the estimated burden associated with “recordkeeping” (EPA 2011a). Sources: BLS 2011, EPA 2011a

631 632 
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August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 27

633 3.4.5 Cost of TPC Annual Reports and Notifications of Changes 

634 

635 Table 3-7 shows the cost of the required annual report to the accreditation bodies that 

636 lists the manufacturers and their products certified by TPCs during the previous year, the list of 

637 non-complying products or events by manufacturer, the list of laboratories and test methods used 

638 by the TPC, and the results of inter-laboratory comparison or proficiency testing for the 

639 laboratories used by the TPC. The cost of notifying the accreditation boardbody of any changes 

640 in personnel, procedure, or laboratory changes is also included. The sum of these costs is 

641 approximately $210 per firm per year in all years. For more information, see Appendix B.
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 28Table 3-7: Annual TPC Burden and Costs for Reporting to Accreditation Body, by Activity 

Activity 

Clerical 

Burden/Cost 

Technical 

Burden/Cost 

Managerial 

Burden/Cost 

(hours) 

(a) 

(2010$) 

(b) 

(hours) 

(c) 

(2010$) 

(d) 

(hours) 

(e) 

(2010$) 

(f) 

(h

(g)=(a

Annual Report to Accreditation Bodies List of Manufacturers and their Products Certified by the TPC during the Previous Year (including Resins Used, and the Average and Range of Formaldehyde Emissions by Manufacturer, Resin, and Product Type)1

0.25 $6.41 0.5 $28.16 0.25 $16.70 

List of Non-complying Products or Events by Manufacturer1 0.25 $6.41 0.5 $28.16 0.25 $16.70 List of Laboratories and Test Methods Used by the TPC1 0.25 $6.41 0.5 $28.16 0.25 $16.70 Results of Inter-Laboratory Comparison or Proficiency Testing for the Laboratories Used by the TPC1

0.25 $6.41 0.5 $28.16 0.25 $16.70 

Accreditation Board Notification Personnel Qualification Changes2 0 $0.00 0.02 $1.13 0.01 $0.67 Procedure Changes2 0 $0.00 0.02 $1.13 0.01 $0.67 Laboratory Change2 0 $0.00 0.02 $1.13 0.01 $0.67 

TOTAL 1 $25.65 2.06 $116.00 1.03 $68.78 

Notes: 1. Estimated as one-third of the burden associated with "recordkeeping" (EPA 2011a). Revised estimate based on best professional judgment. 

2. Based on the estimated burden associated with reporting "company information" (EPA 2011a). Sources: EPA 2011a

642 643 
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August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 29

644 3.5 Total Cost to TPCs 

645 

646 3.5.1 Costs per TPC in the First Year 

647 

648 Table 3-8 presents the estimated costs for TPCs in the first year. There are different cost 

649 estimates for TPCs that already have all of the necessary accreditations, and TPCs that need to 

650 obtain an additional accreditation. 

651 

Table 3-8: Costs per TPC in the First Year 

Type of Cost 

Cost (2010$)1

TPCs with All Necessary 

Accreditations 

TPCs Obtaining One 

Additional Accreditation 

Rule Familiarization $615 $615 

Application Process $492 $492 

Obtaining Accreditation $0 $25,000 

Manufacturer Notification and Recordkeeping $773 $773 

Annual Report and Notifications of Changes $210 $210 

TOTAL $2,090 $27,090 

652 

653 

654 3.5.2 Costs per TPC in Subsequent Years 

655 

656 Table 3-9 presents the estimated costs incurred in subsequent years by TPCs. Again, 

657 there are different cost estimates for TPCs that already have all of the necessary accreditations, 

658 and TPCs that need to obtain an additional accreditation. And costs differ between years when 

659 the TPC must reapply to the accreditation body to participate in the TSCA Title VI program 

660 (which occurs every twothree years) and the alternate years. 

661 

Table 3-9: Costs per TPC in Subsequent-Years 

Type of Cost1

Cost (2010$)2

TPCs with All Necessary 

Accreditations 

TPCs Obtaining One 

Additional Accreditation 

Reapplication Process $492 $492 

Reaccreditation $0 $5,000 

Manufacturer Notification and Recordkeeping $773 $773 

Annual Report and Notifications of Changes $210 $210 

TOTAL – REAPPLICATION YEARS $1,475 $6,475 

TOTAL – NON-REAPPLICATION YEARS $983 $5,983 

Notes: 1. Under the proposed rule, TPCs are required to apply for re-accreditation every three years. As a result, reapplication 

and reaccreditation costs are incurred every third year. 

2. Costs may not sum due to rounding.

662 

663 

664 3.5.3 Total Cost to U.S. TPCs 

665 

666 Table 3-10 summarizes the total costs to U.S. firms assumed to become TPCs under the 

667 TSCA Title VI program. As indicated, the rule is expected to cost the affected TPCs a total of 

668 $93,817810 in the first year, $28,280275 in reapplication years, and $23,852847 in non669 reapplication years. Annualized costs were also calculated, over a 30-year period, at three and 

670 seven percent discount rates. 

671 
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August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 30

Table 3-10: Total Costs to U.S. TPCs (2010$) 

Cost Component 

Cost (2010$) 

TPCs with All 

Necessary 

Accreditation 

TPCs Obtaining One 

Additional 

Accreditation 

Total 

Number of Affected Firms 6 3 9 

Per Firm Costs: Year 1 $2,090 $27,090 - 

Per Firm Costs: Reapplication Years $1,475 $6,475 - 

Per Firm Costs: Non-reapplication Years $983 $5,983 - 

Total First Year Costs $12,540 $81,270 $93,810 

Total Reapplication Year Costs $8,850 $19,425 $28,275 

Total Non-Reapplication Year Costs $5,898 $17,949 $23,847 

30-Year Annualized Costs (3 percent 

discount rate) $6,755 $20,477 $27,232 

30-Year Annualized Costs (7 percent 

discount rate) $6,706 $21,416 $28,123 

Note: Costs are annualized over thirty years for 3 and 7 percent discount rates using the following formula: (present discounted 

value of 30-year stream-of-costs)*(discount rate*(1+ discount rate)30)/((1+ discount rate)31-1). Rule familiarization costs are 

assumed to be incurred immediately and therefore are not discounted. Other costs are discounted assuming that they are incurred

at the end of each year. 

672 

673 EPA is considering requiring TPCs to submit their notifications and reports to the 

674 Agency electronically using the CDX. Appendix C discusses the incremental change in costs if 

675 EPA finalizes a mandatory electronic reporting requirement. As shown in section C.1.4, the total 

676 annualized savings to U.S. TPCs would be $2,852 per year at a 3 percent discount rate, and 

677 $2,754 per year at a 7 percent discount rate. 

678 

679 3.6 Total Costs of the Rule for U.S. AccreditingAccreditation Bodies and TPCs 

680 

681 This section calculates the total cost for U.S. TPCs and accreditingaccreditation bodies as 

682 a result of the TSCA Title VI TPC rule. While the costs analysis is limited to domestic entities, 

683 the burden analysis in Section 4.1 includes both foreign and domestic entities. 

684 

685 The different cost components of the rule (initial costs; notification, reporting, and 

686 recordkeeping costs; TPC reapplication costs; and AB reapplication costs) are incurred at 

687 different times and with different frequencies. Figure 2 demonstrates how the different cost 

688 components occur over the first nine years, and how they are categorized into five different 

689 categories of years, depending on which component occurs in that year. These same five 

690 categories are used in Table 3-11 and Table 3-12. Table 3-11 presents the per-firm costs for 

691 accreditingaccreditation bodies and TPCs in each of these categories of years. Table 3-12 

692 presents the total costs for the eight U.S. accreditingaccreditation bodies and nine U.S. TPCs 

693 combined. To estimate total costs, per-firm costs were multiplied by the number of affected 

694 firms. Annualized costs were also calculated, over a 30-year period, at three and seven percent 

695 discount rates. 

696 
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August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 31

697 

Figure 2. Timing of Cost Components Over the First Nine Years of the Program

Cost Component Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 

Initial costs X 

Notification, reporting, 

and recordkeeping 

X X X X X X X X X 

TPC reapplication X X 

AB reapplication X X X 

All TPCs are assumed to have been approved by CARB and thus grandfathered into the federal program for one year, so TPC 

reapplication occurs every 3 years starting in Year 4. AB reapplication occurs every 3 years starting in Year 3. 

Key Description

Initial Applications for ABs (beginning of Year 1) and TPCs (end of Year 1)

Non-Reapplication Years for ABs, Non-Reapplication Years for TPCs

Non-Reapplication Years for ABs, Reapplication Years for TPCs

Reapplication Years for ABs, Non-Reapplication Years for TPCs

Reapplication Years for ABs, Reapplication Years for TPCs

698 

699 

Table 3-11: Cost per Year for Accreditation Bodies and Third Party Certifiers (2010$) 

Year ABs 

TPCs 

Have Necessary 

Accreditation 

Need Additional 

Accreditation 

Per Firm Costs: Year 1 $1,685 $2,090 $27,090 

Per Firm Costs: Years 2, 5, 8, 11, 14, 17, 

20, 23, 26, 29 (Non-Reapplication Years for 

ABs, Non-Reapplication Years for TPCs) 

$633 $983 $5,983 

Per Firm Costs: Years 3, 6, 9, 12, 15, 18, 

21, 24, 27, 30 (Reapplication Years for 

ABs, Non-Reapplication Years for TPCs) 

$1,070 $983 $5,983 

Per Firm Costs: Years 4, 7, 10, 13, 16, 19, 

22, 25, 28 (Non-Reapplication Years for 

ABs, Re-Application Years for TPCs) 

$633 $1,475 $6,475 

700 

701 

702 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 32

Table 3-12: Total Costs to U.S. Accreditation Bodies and Third Party Certifiers (2010$) 

Year U.S. ABs 

U.S. TPCs All Affected U.S. 

Firms Have Necessary 

Accreditation 

Need Additional 

Accreditation 

Number of Affected Firms 8 6 3 17 

Total Year 1 Costs $13,480 $12,540 $81,270 $107,290 

Total Costs in Years 2, 5, 8, 11, 14, 17, 20, 23, 

26, 29 (Non-Reapplication Years for ABs, NonReapplication Years for TPCs) $5,064 $5,898 $17,949 $28,911 

Total Costs in Years 3, 6, 9, 12, 15, 18, 21, 24, 

27, 30 (Reapplication Years for ABs, NonReapplication Years for TPCs) $8,560 $5,898 $17,949 $32,407 

Total Costs in Years 4, 7, 10, 13, 16, 19, 22, 25, 

28 (Non-Reapplication Years for ABs, ReApplication Years for TPCs) $5,064 $8,850 $19,425 $33,339 

30-Year Annualized Costs 

(3 percent discount rate) $6,303 $6,755 $20,477 $33,535 

30-Year Annualized Costs 

(7 percent discount rate) $6,320 $6,706 $21,416 $34,443 

Note: Annualized costs are annualized over thirty years for 3 and 7 percent discount rates using the following formula: (present discounted value 

of 30-year stream-of-costs)*(discount rate*(1+ discount rate)30)/((1+ discount rate)31-1). Rule familiarization, AB application costs, and AB 

recognition agreement costs are assumed to be incurred immediately and therefore are not discounted. Other costs are discounted assuming that 

they are incurred at the end of each year. 

703 

704 

705 EPA is considering requiring accreditation bodies and TPCs to submit their notifications and 

706 reports to the Agency electronically using the CDX. Appendix C discusses the incremental change in 

707 costs if EPA finalizes a mandatory electronic reporting requirement. As shown in section C.1.4, 

708 electronic reporting via CDX would reduce the annualized costs of the rule to U.S. accreditation bodies 

709 and TPCs from $33,535 to $29,490 per year at a 3 percent discount rate, a savings of $4,045 per year. At 

710 a 7 percent discount rate, costs are estimated to decrease from $34,443 to $30,542, a savings of $3,900 

711 per year. There are additional unquantified improvements in efficiency and higher data quality due to 

712 electronic reporting.

713 

714 

715 

716 
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August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 33

717 4 Impact Analyses 

718 

719 In addition to the cost analysis presented in Chapter 3, several other types of impacts are 

720 important to consider in evaluating the effects of a regulation. This chapter presents the 

721 incremental impact of the proposed TPC Rule on: 

722 

723  Paperwork burden, as required by the Paperwork Reduction Act (PRA); 

724  Financial condition of small entities, as required by the Regulatory Flexibility Act 

725 (RFA); 

726  State and Local Governments, as required by the Unfunded Mandates Reform Act; 

727  Federalism, as required by Executive Order 13132–Federalism; 

728  Tribal governments, as required by Executive Order 13175–Consultation and 

729 Coordination with Indian Tribal Governments; 

730  The environmental health risk or safety risk to children due to the regulation, as 

731 required by Executive Order 13045–Protection of Children From Environmental 

732 Health & Safety Risks; 

733  Whether voluntary consensus standards are used in its regulatory activities; and 

734  Low income and minority populations, as required by Executive Order 12898. 

735 

736 4.1 Paperwork Reduction Act Analysis 

737 

738 This section estimates the burden of reporting and recordkeeping for the proposed Third 

739 Party Certification rule. It presents average annual burden and cost estimates for affected 

740 accreditation bodies and third party certifiers over the first three years of the program. The labor 

741 hours and costs per firm are the same as those shown in Chapter 3 – the sum of the rule 

742 familiarization, application, recordkeeping, and reporting burdens and costs. However, the 

743 numbers of firms considered here are greater than in the cost analysis in Chapter 3 because both 

744 domestic and foreign firms are included. 

745 

746 Table 4-1 presents the PRA per-firm labor burdens and costs by the type of affected firm. 

747 The total burden and cost are calculated by multiplying the burdens and costs per firm by the 

748 number of affected firms. 

749 

750 EPA is considering requiring accreditation bodies and TPCs to submit their notifications 

751 and reports to the Agency electronically using the CDX. Appendix C discusses the incremental 

752 change in burden and costs if EPA finalizes a mandatory electronic reporting requirement. As 

753 shown in section C.1.4, electronic reporting via CDX would reduce the average total burden 

754 hours for all 61 domestic and foreign respondents from 1,421 hours to 1,029 hours per year, a 

755 savings of 392 hours per year. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 34

Table 4-1: Total PRA Burdens and Costs (2010$)

Firm Type Number 

of Firms

Per Firm Burden and Cost Total Burden and Cost 

Labor NonLabor 

Cost 

Labor NonLabor 

Cost Hours Cost Hours Cost 

Year 1 

Domestic Accreditation Body 8 29.6042 $1,685 237 $13,480 

Foreign Accreditation Body 17 29.6642 $1,688 504 $28,696 

Domestic TPC obtaining one additional accreditation 3 37.3250 $2,090 $25,000 112 $6,270 $75,000 

Domestic TPC with current accreditations 6 37.3250 $2,090 224 $12,540 

Foreign TPC obtaining one additional accreditation 9 37.3550 $2,092 $25,000 336 $18,828 $225,000 

Foreign TPC with current accreditations 18 37.3550 $2,092 672 $37,656 

Year 2

Domestic Accreditation Body 8 12.1442 $633 97 $5,064 

Foreign Accreditation Body 17 12.2042 $636 207 $10,812 

Domestic TPC obtaining one additional accreditation 3 19.1650 $983 $5,000 57 $2,949 $15,000 

Domestic TPC with current accreditations 6 19.1650 $983 115 $5,898 

Foreign TPC obtaining one additional accreditation 9 19.1950 $985 $5,000 173 $8,865 $45,000 

Foreign TPC with current accreditations 18 19.1950 $985 346 $17,730 

Year 3

Domestic Accreditation Body 8 19.6042 $1,070 157 $8,560 

Foreign Accreditation Body 17 19.6642 $1,073 334 $18,241 

Domestic TPC obtaining one additional accreditation 3 19.1650 $983 $5,000 57 $2,949 $15,000 

Domestic TPC with current accreditations 6 19.1650 $983 115 $5,898 

Foreign TPC obtaining one additional accreditation 9 19.1950 $985 $5,000 173 $8,865 $45,000 

Foreign TPC with current accreditations 18 19.1950 $985 346 $17,730 

Three Year Average

Domestic Accreditation Body 8 20.4509 $1,129 164 $9,035 

Foreign Accreditation Body 17 20.5109 $1,132 349 $19,250 

Domestic TPC obtaining one additional accreditation 3 25.2183 $1,352 $11,667 76 $4,056 $35,000 

Domestic TPC with current accreditations 6 25.2183 $1,352 151 $8,112 

Foreign TPC obtaining one additional accreditation 9 25.2483 $1,354 $11,667 227 $12,186 $105,000 

Foreign TPC with current accreditations 18 25.2483 $1,354 454 $24,372 

All Entities 61 23.2945 $1,262 $2,295 1421 $77,010 $140,000 

756 

757 

758 4.2 Regulatory Flexibility Act Analysis 

759 

760 This section presents the impact of the costs of accreditation under the proposed TSCA 

761 Title VI TPC rule on the financial condition of small entities. The Regulatory Flexibility Act 

762 (RFA) of 1980, amended by the Small Business Regulatory Enforcement Fairness Act 

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

764 including businesses, nonprofit organizations, and governments. In some instances, agencies are 

765 also required to examine regulatory alternatives that may reduce adverse economic effects on 

766 significantly impacted small entities. The RFA requires agencies to prepare an initial and final 

767 regulatory flexibility analysis for each rule unless the Agency certifies that the rule will not have 

768 a significant economic impact on a substantial number of small entities. The RFA, however, 

769 does not specifically define “a significant economic impact on a substantial number” of small 
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August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 35

770 entities. Sections 603 and 604 of the RFA require that regulatory flexibility analyses identify the 

771 types, and estimate the numbers, of small entities to which the rule will apply; and describe the 

772 rule requirements to which small entities will be subject and any regulatory alternatives, 

773 including exemptions and deferral, which would lessen the rule’s burden on small entities. 

774 

775 The TPC rule will affect small businesses and small non-profit organizations. (No small 

776 governments are expected to be affected by the TPC rule.) Under the Regulatory Flexibility Act 

777 (RFA), a “small business” is determined by the U.S. Small Business Administration’s 

778 regulations at 13 CFR 121.201 (which create small business size standards using either a sales or 

779 employment threshold, depending on the nature of the industry), unless an agency establishes an 

780 alternate definition. And unless an agency establishes an alternate definition, under the RFA the 

781 term “small organization” means any not-for-profit enterprise which is independently owned and 

782 operated and is not dominant in its field. The RFA does not provide any guidance on how to 

783 judge whether an organization is dominant in its field. Non-profit TPCs and accreditation bodies 

784 perform the same activities (such as conducting and verifying formaldehyde emissions tests, 

785 accrediting, and auditing) as their for-profit counterparts. In order to interpret the RFA criteria 

786 for small organizations and treat all affected entities consistently, this analysis determines the 

787 size status of non-profits by applying the SBA size thresholds for the NAICS codes the non788 profits are classified in. 

789 

790 To fulfill the requirements of the RFA, this analysis addresses two basic questions 

791 regarding the proposed rule: (1) the number and type of small entities potentially affected, and 

792 (2) the extent of the rule’s potential economic impact on those entities as measured by the costto-revenue ratio for businesses and the cost-to-expenses ratio for small non-profit organizations.3 793 

794 This ratio is a good measure of entities’ ability to afford the costs attributable to a regulatory 

795 requirement, because comparing compliance costs to revenues or expenses provides a reasonable 

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

797 economic activity. Where regulatory costs represent a small fraction of a typical entity’s 

798 revenues or expenses, the financial impacts of the regulation on such entities may be considered 

799 as not significant. The impact ratios are calculated using annualized costs, because these costs 

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

801 

802 4.2.1 Small Entity Impacts for Accreditation Bodies 

803 

804 As described in Section 2.2.1, five of the eight U.S. accreditation bodies that are IAF or 

805 ILAC signatories are non-profit organizations, while two are businesses, and one is a federal 

806 government agency. Using the size standard thresholds from the U.S. Small Business 

807 Administration, three of the non-profits and one of the businesses are classified as “small”. Per808 firm costs were calculated as the quotient of the 30-year annualized costs and the number of 

809 affected firms presented in Table 3-2 (i.e., $6,204303 ÷ 8), which results in an annualized cost 

810 estimate of $775788 per entity per year. Estimated cost impacts ranged from 0.01 percent to 

811 0.1514 percent of expenditures for the three small non-profits, and were 0.21 percent of sales for 

812 the small business. As a result, no small accreditation bodies are expected to be significantly 

813 impacted by the rule. 

 3

 Expenses and revenues were close to each other for the non-profit ABs and TPCs that were analyzed, so either 

measurement of impacts would provide similar results. 
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August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 36

814 

815 

Table 4-2: Small Entity Impacts for U.S. ABs 

Type 

Annualized Costs 

Per Entity 

(3% discount rate) 

Estimated Number of Small Entities with Impacts 

Under One 

Percent 

Between One 

and Three 

Percent 

Over Three 

Percent 

Non-profits $788 3 0 0 

Business $788 1 0 0 

Total 4 0 0 

816 

817 

818 4.2.2 Small Entity Impacts for Third-Party Certifiers 

819 

820 The cost of the rule to TPCs depends on whether the TPC already has all of the necessary 

821 accreditations. A TPC with all of the accreditations in place is estimated to incur an annualized 

822 cost of $1,202126 per year for the required applications, reporting, and recordkeeping, while a 

823 TPC that needs to obtain an additional accreditation is estimated to incur an annualized cost of 

$6,902826 per year.

4 824 

825 

826 Data were available to make size determinations for four of the nine U.S. TPCs 

827 participating in the CARB program. Using the data in Table 2-1 and the size standard thresholds 

828 from the U.S. Small Business Administration, two of these four TPCs are large businesses, and 

829 two are small non-profit organizations. The small non-profits are assumed to have all of their 

830 accreditations currently in place, and thus incur a cost of $1,202126 per year due to the rule, as 

831 shown in Table 4-3. Based on the expenditure data in Table 2-1, both of the small non-profit 

832 TPCs have cost impacts of less than 0.1%. 

833 

Table 4-3: Impacts to Small Non-Profit TPCs in the U.S. 

Type 

Annualized Costs 

Per Entity 

(3% discount rate) 

Estimated Number of Small Entities with Impacts 

Under One 

Percent 

Between One 

and Three 

Percent 

Over Three 

Percent 

Non-profits $1,126 2 0 0 

834 

835 Size information was not located for the remaining five U.S. TPCs. This analysis 

836 assumes that 50 percent of the remaining five TPCs are small businesses, which rounds up to 

837 three additional firms. Based on the information in Section 3.4.3, the analysis also assumes that 

838 two of the three will already have all their accreditations in place and that one will need to obtain 

839 an additional accreditation. As a result, the two TPCs with accreditations in place will incur an 

840 estimated annualized cost of $1,202126 and the TPC that needs to obtain an additional 

841 accreditation will incur an estimated annualized cost of $6,902826. 

842 

843 Data from the 2007 Economic Census data (U.S. Census Bureau 2007) was used to 

844 estimate impacts on the three TPCs that are assumed to be small businesses. The Census data 

845 provided the number of firms in different revenue brackets (less than $100,000 per year, 

 4

 Based on the information in Table 3-10, $6,755 ÷ 6 = $1,126 per year for TPCs that have all accreditations in place, and 

$20,477 ÷ 3 = $6,826 per year for TPCs that need an additional accreditation. 
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August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 37

846 $100,000 to $499,999, $500,000 to $999,999, etc.) for the affected NAICS codes (541330, 

847 541380, 541611, and 561990). Revenue thresholds were then back-calculated such that 

848 annualized compliance costs created a one or three percent impact. For example, revenue would 

849 have to be less than $120,200112,600 in order for a firm with all of its accreditations to have at 

850 least a one percent impact, and less than $40,06737,533 in order to have an impact of at least 

three percent.5 851 

852 

853 The next step was to interpolate the number of firms below each of these revenue 

854 thresholds, assuming that firms are evenly distributed within a revenue bracket. For example, 

855 out of 125123,359 firms in these NAICS codes, the Census reported that 32,987 firms had 

856 revenues of less than $100,000, and 49,013 firms had revenues between $100,000 and $499,999. 

857 Therefore, as shown in Table 4-4, an estimated 34,967222 firms have revenues below 

$120,200112,600.

6 858 

859 

860 In this example, these 34,967222 firms represent 28% of the firms in these NAICS codes.

7 861 Multiplying the two small business TPCs with all necessary accreditations by 28%, and 

862 rounding to the nearest whole number, yields the result that one of these firms is estimated to 

863 have impacts over the one percent level. Performing a similar calculation for the three percent 

864 impact level yields the result that neither of the two small business TPCs with all their 

865 accreditations are predicted to have an impact over the three percent level. So the second TPC 

866 with all of its accreditation has an impact of less than one percent (not shown in Table 4-4). 

867 Repeating these calculations for the small business TPC that needs an additional accreditation 

868 yields the result that it is estimated to have a cost impact between one percent and three percent. 

869 

Table 4-4: : Impacts to Small Business TPCs in the U.S. 

Firm Type 

Annualized 

Costs Per 

Firm (3% 

discount 

rate) 

Associated Revenue 

Thresholds 

Number of Firms 

Below Threshold1

Percent of Firms 

Below Threshold2

Estimated Number 

of Small TPCs with 

Impacts Over3

1% 

Impact 

3% 

Impact 

1% 

Impact 

3% 

Impact 

1% 

Impact 

3% 

Impact 

1% 

Impact 

3% 

Impact 

Firms with all 

necessary 

accreditations 

(n = 2) $1,126 $112,600 $37,533 34,222 12,381 28% 10% 1 0 

Firms that need 

to obtain one 

additional 

accreditation 

(n = 1) $6,826 $682,600 $227,533 84,700 45,489 69% 37% 1 0 

Notes: 1. The analysis assumes that firms are distributed evenly within a revenue bracket. 

2. The percentage of firms below the threshold is calculated by dividing the number of firms below the threshold by 123,359 (the 

total number of firms in NAICS codes 541,330, 541380, 541611, and 561990. 

3. The analysis assumes that two of the three small business TPCs will already have accreditations in place and that one will need 

to obtain additional accreditation. 

870 

 5

 For a firm with all of its certifications, compliance cost of $1,126 ÷ 1% impact = $112,600 in revenues, and $1,126 ÷ 

3% impact = $37,533 in revenues. 

6

 32,987 firms under $100,000 + (($112,600 - $100,000) ÷ $499,999) x 49,013 firms between $100,000 and $499,999 = 

34,222 firms under $112,600. 

7

 34,222 firms under $112,600 is 28% of the 123,359 total firms. 
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August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 38

871 As described in Section 2.2.1, the CARB TPCs appear to be larger than the average firms in 

872 these industries, so Census statistics may underestimate the revenues and overestimate the 

873 impacts on TPCs (which represent just 0.006 percent of the firms in these NAICS codes). 

874 

875 Table 4-5 summarizes the annualized per-firm costs, and the number of affected number 

876 of TPCs with impacts exceeding the one and three percent levels. Costs are estimated to exceed 

877 the one percent level for two small businesses. However, given that these firms have the 

878 incentive to seek accreditation only if they can pass through their costs to the firms they are 

879 certifying, they are not expected to experience a negative economic impacts as a result of this 

880 proposed rule. 

881 

Table 4-5: Small Entity Impacts for U.S. TPCs 

Certification Status 

Annualized Costs 

Per Entity 

(3% discount rate) 

Small Entity Type 

Estimated Number of Small Entities 

with Impacts 

Under One 

Percent 

Between One 

and Three 

Percent 

Over Three 

Percent 

TPCs with current AB 

certification $1,126 Non-profit 2 0 0 

Business 1 1 0 

TPCs that need to obtain 

new AB certification $6,826 Non-profit 0 0 0 

Business 0 1 0 

Combined 

Non-profit 2 0 0 

Business 1 2 0 

Total 3 2 0 

882 

883 

884 4.2.3 Summary of Small Entity Impacts to ABs and TPCs 

885 

886 As shown in Table 4-6, there are a total of 9 small entities in the U.S. assumed to be 

887 directly affected by the Title VI TPC rule. Five of these are non-profits, all of which are 

888 estimated to have cost impacts of less than one percent of expenditures. Four are businesses, two 

889 of which are estimated to have cost impacts of less than one percent of revenues, and two of 

890 which are estimated to have cost impacts between one percent and three percent of revenues. 

891 

Table 4-6: Summary of Small Entity Impacts to ABs and TPCs 

Entity Type Number of U.S. Entities 

that are Small 

Estimated Number of Small Entities with Impacts 

Under One 

Percent 

Between One and 

Three Percent 

Over Three Percent 

TPCs Non-profit 2 2 0 0 

Business 3 1 2 0 

ABs Non-profit 3 3 0 0 

Business 1 1 0 0 

Combined 

Non-profit 5 5 0 0 

Business 4 2 2 0 

Total 9 7 2 0 

892 

893 4.3 Unfunded Mandates Reform Act (UMRA) 

894 

895 Title II of the Unfunded Mandates Reform Act of 1995, Pub. L. 104-4, establishes 

896 requirements for Federal agencies to assess the effects of their regulatory actions on State, local, 

897 and Tribal governments, and the private sector. Under section 202 of the UMRA, EPA generally 
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August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 39

898 must prepare a written statement, including a cost-benefit analysis, for proposed and final rules 

899 with “Federal mandates” that might result in expenditures by State, local, and Tribal 

900 governments, in the aggregate, or by the private sector, of $100 million or more (when adjusted 

901 annually for inflation) in any one year. 

902 

903 The cost of the proposed TPC rule is well below $100 million per year in any one year. 

904 The rule is not expected to affect State, local, and Tribal governments. 

905 

906 4.4 Executive Order 13132 - Federalism 

907 

908 Executive Order 13132, entitled Federalism (64 FR 43255, August 10, 1999), directs 

909 federal agencies to consider whether a rule has federalism implications (i.e. whether it has 

910 substantial direct effects on the states, on the relationship between the national government and 

911 the states, or on the distribution of power and responsibilities among the various levels of 

912 government, as specified in Executive Order 13132). 

913 

914 The TPC rule does not have a substantial direct effects on states or local governments 

915 (individually or collectively), on the relationship between the national government and the states, 

916 or on the distribution of power and responsibilities among the various levels of government. No 

917 state or local governments are expected to become TPCs or accreditingaccreditation bodies, and 

918 thus state and local governments will not incur direct compliance costs as a result of the rule. The 

919 rule does not preempt state or local law, and the rule is required by statute. 

920 

921 4.5 Executive Order 13175 - Tribal Implications 

922 

923 Executive Order 13175, entitled Consultation and Coordination with Indian Tribal 

924 Governments (59 FR 22951, November 6, 2000), directs federal agencies to consider whether a 

925 rule has tribal implications (i.e. whether it has substantial direct effects on tribal governments, on 

926 the relationship between the Federal government and the Indian tribes, or on the distribution of 

927 power and responsibilities between the Federal government and Indian tribes). No tribal 

928 government is expected to become a TPC or an accreditingaccreditation body, and thus tribal 

929 governments will not incur direct compliance costs as a result of the rule. The rule does not 

930 change the relationship between the Federal government and Indian tribes, or change the 

931 distribution of power. 

932 

933 4.6 Executive Order 13045 - Protection of Children 

934 

935 Under Executive Order 13045, a regulation must be reviewed if the regulatory action is 

936 economically significant and concerns an environmental health risk or safety risk that may 

937 disproportionately affect children. The proposed TPC rule is not economically significant 

938 because it will not have an annual impact on the economy of $100 million or more. 

939 

940 4.7 Executive Order 13211 - Energy Effects 

941 Executive Order 13211, entitled Actions Concerning Regulations that Significantly 

942 Affect Energy Supply, Distribution, or Use (66 FR 28355, May 22, 2001), directs federal 
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August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 40

943 agencies to identify actions that will have a significant adverse energy effect. Adverse effects 

944 are defined as: 

945 

946  Reductions in crude oil supply in excess of 10,000 barrels per day; 

947  Reductions in fuel production in excess of 4,000 barrels per day; 

948  Reductions in coal production in excess of 5 million tons per year; 

949  Reductions in natural gas production in excess of 25 million mcf per year; 

950  Reductions in electricity production in excess of 1 billion kilowatt-hours per year or in 

951 excess of 500 megawatts of installed capacity; 

952  Increases in energy use required by the regulatory action that exceed any of the 

953 thresholds above; 

954  Increases in the cost of energy production in excess of one percent; 

955  Increases in the cost of energy distribution in excess of one percent; or 

956  Other similarly adverse outcomes. 

957 

958 The regulations under consideration will not significantly reduce energy production nor 

959 significantly increase energy costs. 

960 

961 4.8 National Technology Transfer and Advancement Act 

962 

963 Section 12(d) of the National Technology Transfer and Advancement Act of 1995 

964 (“NTTAA”), Public Law No. 104-113 (15 U.S.C. 272 note) directs EPA to use voluntary 

965 consensus standards in its regulatory activities unless to do so would be inconsistent with 

966 applicable law or otherwise impractical. Voluntary consensus standards are technical standards 

967 (e.g., materials specifications, test methods, sampling procedures, business practices, etc.) that 

968 are developed or adopted by voluntary consensus standards bodies. NTTAA directs EPA to 

969 provide Congress, through OMB, explanations when the Agency decides not to use available and 

970 applicable voluntary consensus standards. 

971 

972 This proposed rulemaking involves technical standards, and EPA proposes to use 

973 voluntary consensus standards. The proposed framework of this third party certification program 

974 is based on the ability of ABs to review TPCs for their conformity to ISO/IEC Guide 65, 

975 ISO/IEC 17025, and ISO/IEC 17020. Both Product ABs and Laboratory ABs must maintain 

976 their conformity to ISO/IEC 17011 and ISO/IEC Guide 65. 

977 

978 4.9 Executive Order 12898 – Environmental Justice 

979 

980 Under Executive Order 12898, when promulgating a regulation, EPA investigates 

981 whether there are disproportionately high and adverse human health or environmental effects on 

982 minority and low-income populations. Since this proposed rulemaking addresses the process for 

983 accreditation bodies and TPCs, this proposed rule does result in any adverse human health or 

984 environmental effects. 

985 

986 

987 
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August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 41

988 References 

989 AIHA-LAP LLC. 2012. About AIHA Laboratory Accreditation Programs. Available at: 

990 http://www.aihaaccreditedlabs.org/about/pages/default.aspx (Accessed April 27, 

991 2012) 

992 American Business Directory. 2011. 2011 American Business Information: Perry 

993 Johnson Inc. and Perry Johnson Registrars. 

994 California Air Resources Board (CARB). 2011. List of CARB Approved Third Party 

995 Certifiers. 

996 Dun & Bradstreet. 2011. Company Reports. Proprietary Database. 

997 International Accreditation Forum (IAF). 2011. Signatories to the IAF MLA for ISO 

998 9001, ISO 14001, Product, 31 May 2011. 

999 International Laboratory Accreditation Cooperation (ILAC). 2011. Signatories to the 

1000 ILAC Mutual Recognition Arrangement, Updated 16 May 2011. 

1001 Perry Johnson & Associates. 2012. Contact us - Perry Johnson & Associates, Inc. 

1002 Available at: www.pjats.com/contact-us/ (Accessed April 27, 2012) 

1003 Personal Communication with Forestwood Industries. 2011. Conversation between Gary 

1004 Poserina (Forestwood Industries, Inc.) and Abt Associates Inc. . March 2, 2011. 

1005 Personal Communication with IAS. 2011. Conversation between Patrick McCullen 

1006 (International Accreditation Service) and Abt Associates Inc. June 22, 2011. 

1007 Personal Communication with NSF International. 2011a. Conversation between Kerri 

1008 Levanseler (NSF International) and Abt Associates Inc. March 2, 2011. 

1009 Personal Communication with NSF International. 2011b. Conversation between Craig 

1010 Moore (NSF International) and Abt Associates Inc. March 11, 2011. 

1011 Personal Communication with NTA Inc. 2011. Conversation between Dale Arter (NTA 

1012 Inc.) and Abt Associates Inc. March 2, 2011. 

1013 Personal Communication with PFS Corporation. 2011. Conversation between James Van 

1014 Schoyck and Ron Reindl (PFS Corporation, Inc.) and Abt Associates Inc. 

1015 February 25, 2011. 

1016 Personal Communication with PSI. 2011. Conversation between Randy Webb 

1017 (Professional Service Industries, Inc.) and Abt Associates Inc. February 14, 2011. 

1018 Personal Communication with SCS International. 2011. Conversation between Michael 

1019 Wolfe (SCS International) and Abt Associates Inc. February 28, 2011. 

1020 PFS Corporation. 2012. History - PFS Corporation. Available at: 

1021 www.pfscorporation.com/history.php (Accessed April 27, 2012) 

1022 Professional Service Industries Inc. (PSI). 2012. Welcome to PSI. Available at: 

1023 www.psiusa.com (Accessed April 27, 2012) 
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August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 42

1024 Scientific Certification Systems (SCS). 2012a. Staff Roster - Scientific Certification 

1025 Systems. Available at: www.scscertified.com/scs_staff.php (Accessed April 27, 

1026 2012) 

1027 Scientific Certification Systems (SCS). 2012b. Management Roster - Scientific 

1028 Certification Systems. Available at: www.scscertified.com/scs_management.php 

1029 (Accessed April 27, 2012) 

1030 U.S. Bureau of Labor Statistics (BLS). 2011. Employer Costs for Employee 

1031 Compensation: Supplementary Tables: Historical Data: December 2006 - March 

1032 2011. 

1033 U.S. Census Bureau. 2010a. Sector 54: EC0754SSSZ4: Professional, Scientific, and 

1034 Technical Services: Subject Series - Estab & Firm Size: Receipts/Revenue Size of 

1035 Firms for the United States: 2007. 

1036 U.S. Census Bureau. 2010b. Sector 56: EC0756SSSZ4: Administrative and Support and 

1037 Waste Management and Remediation Services: Subject Series - Establishment 

1038 and Firm Size: Receipts Size of Firms for the United States: 2007. 

1039 U.S. Census Bureau. 2010c. Sector 81: EC0781SSSZ4: Other Services (Except Public 

1040 Administration): Subject Series - Estab & Firm Size: Receipts/Revenue Size of 

1041 Firms for the United States: 2007. 

1042 U.S. Census Bureau. 2010d. Sector 31: EC0731I1: Manufacturing: Industry Series: 

1043 Detailed Statistics by Industry for the United States: 2007. 

1044 U.S. Environmental Protection Agency (EPA). 2002a. Economic Analysis for the 

1045 Amended Inventory Update Rule: Final Report (EPA-HQ-OPPT-2002-0054-

1046 0260). August 2002. 

1047 U.S. Environmental Protection Agency (EPA). 2002b. Wage Rates for Economic 

1048 Analysis of the Toxics Release Inventory Program. June 10, 2002. 

1049 U.S. Environmental Protection Agency (EPA). 2009. Economic Analysis of the 

1050 Premanufacture Notification Electronic Reporting Final Rule. U. S. E. P. A. 

1051 Office of Pollution Prevention and Toxics. July 13, 2009. 

1052 U.S. Environmental Protection Agency (EPA). 2011a. Supporting Statement for a 

1053 Request for OMB Review under the Paperwork Reduction Act: the Final Rule 

1054 Addendum to Partial Update of the TSCA Section 8(b) TSCA Inventory Data 

1055 Base, Production and Site Reports. 

1056 U.S. Environmental Protection Agency (EPA). 2011b. Supporting Statement for EPA 

1057 Information Collection Request Number 2002.05, “Cross-Media Electronic 

1058 Reporting Rule” Office of Environmental Information, U.S. Environmental 

1059 Protection Agency. June 22, 2011. 

1060 U.S. Internal Revenue Service. 2009. Form 990: Return of Organization Exempt from 

1061 Income Tax for Nonprofit ABs and TPCs. 

1062 U.S. Internal Revenue Service. 2010. Form 990: Return of Organization Exempt from 

1063 Income Tax for Nonprofit ABs and TPCs. 
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August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule 43

1064 U.S. Small Business Administration. 2010. Table of Small Business Size Standards 

1065 Matched to North American Industry Classification System Codes. 

1066 Weinstein, H. G. and M. A. Loewenstein. 2004. Comparing Current and Former Industry 

1067 and Occupation ECEC Series. August 25, 2004. 

1068 

1069 
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August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule A-1

1070 Appendix A– Wage Rate Calculations

1071 This appendix describes the derivation of the fully loaded wage rates and inflation factors 

1072 used in calculating costs of labor, materials, and other inputs. All cost estimates are presented in 

1073 fourth quarter, calendar year 2010 dollars, representing the most recent full year of data 

1074 available. 

1075 

1076 The fully loaded unit labor cost for managerial, professional/technical, and clerical labor 

1077 in the regulated industry and for EPA staff is estimated by adding fringe benefits and overhead 

1078 costs to the hourly wage or annual salary for each category following the method described in 

1079 Wage Rates for Economic Analysis of the Toxics Release Inventory Program (EPA 2002b, 

1080 2002b).). This appendix describes the method employed to estimate the fully loaded unit labor 

1081 costs for each labor category and presents the results of the analysis. 

1082 

1083 Labor categories used in the analysis correspond to the U.S. Bureau of Labor Statistics 

1084 (BLS) Standard Occupational Classification (SOC) system. In March 2004, BLS began using the 

1085 North American Industry Classification System (NAICS) instead of the Standard Industrial 

1086 Classification (SIC) System, and the Standard Occupational Classification (SOC) system instead 

1087 of the Occupational Classification System (OCS). Exhibit A-1 summarizes the crosswalk 

1088 between old and new occupational titles, and lists the SOC titles that correspond to the 

1089 managerial, professional/technical, and clerical labor categories used in this analysis (Weinstein 

1090 and Loewenstein 2004(Weinstein and Loewenstein, 2004).).

1091 

Exhibit A-1: Detail of Labor Categories Used in the Analysis 

Labor Category Used in the 

Analysis BLS Old Title (OCS) BLS New Title (SOC) 

Managerial Executive, administrative, and 

managerial Management, business, and financial 

Professional/Technical Professional specialty and technical Professional and related 

Clerical Administrative support, including 

clerical Office and administrative support 

Source: Weinstein and Loewenstein 2004 

1092 

1093 Wages and fringe benefit data for managerial, professional/technical, and clerical labor 

1094 are from the BLS Employer Costs for Employee Compensation (ECEC) historical data for 

December 2006 – March 2011 (BLS 2011, 2011).).8 1095 

1096 

1097 The costs of fringe benefits such as paid leave and insurance, specific to each labor 

1098 category, are taken from the same BLS report (BLS 2011, 2011).). Fringe benefits as a 

1099 percentage of wages are calculated separately for each labor category. For example, for 

1100 December 2010, the average wage rate for professional/ technical labor was $36.57, and the 

average fringe benefit was $13.52.9 1101 Therefore, fringe benefits as a percentage of wages were 

1102 $13.52/$36.57, or approximately 37 percent (see Exhibit A-2). 

 8

 Past economic analyses used ECEC data series specific to white-collar workers in the manufacturing sector. However, 

those data sets were discontinued in March 2007, and these historical data were the best alternative. In a phone 

conversation (February 11, 2009), a BLS employee could not identify a better data set to use. 9

 Past economic analyses have used the term “technical” labor. Here the category is called “professional/technical” labor, 

to make clear how it relates to BLS categories. In 2004, BLS changed from the Occupational Classification System, 
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August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule A-2

1103 

1104 An additional loading factor of 17 percent is applied to wages to account for overhead. 

1105 This approach is used for consistency with Office of Pollution Prevention and Toxics (OPPT) 

1106 economic analyses for two major rulemakings: Wage Rates for Economic Analyses of the Toxics 

1107 Release Inventory Program, June 2002 (EPA 2002b, 2002b),), and the Revised Economic 

1108 Analysis for the Amended Inventory Update Rule: Final Report, August 2002 (EPA 2002a, 

1109 2002a).). This overhead loading factor is added to the benefits loading factor, and the total is 

1110 then applied to the base wage to derive the fully loaded wage. For example, the December 2010 

1111 fully loaded wage for professional/technical labor is $36.97 × (1+ 0.37 + 0.17) = $56.31. 

1112 

1113 Fully loaded costs for managerial and clerical labor are calculated in a similar manner, as 

1114 shown in Exhibit A-2. 

1115 

Exhibit A-2: Derivation of Loaded Industry Wage Rates 

Labor 

Category 

Data Source for Wage 

Information Date 

Wage Fringe 

Benefit

Fringes as 

% wage 

Overhead as 

% wage a 

Fringe + 

overhead factor

Loaded 

Wages 

(a) (b) (c)=(b)/(a) (d) (e)=(c)+(d)+1 (f)= 

(a)*(e) 

Clerical 

BLS ECEC, Private 

Professional and Business 

Services Industries, “Office 

and Administrative Support”2 

Dec-10 $16.72 $6.09 36.42% 17% 1.53 $25.65 

Professional/ 

Technical 

BLS ECEC, Private 

Professional and Business 

Services Industries, 

“Professional and related“2 

Dec-10 $36.57 $13.52 36.97% 17% 1.54 $56.31 

Managerial 

BLS ECEC, Private 

Professional and Business 

Services Industries, “Mgt, 

Business, and Financial”2 

Dec-10 $42.42 $17.15 40.43% 17% 1.57 $66.78 

Notes: 

a

 An overhead rate of 17% is used based on assumptions in EPA (2002a) and EPA (2002b). b

 Data for this occupational series found in BLS (2011). 

 OCS, to the Standard Occupational Classification system, SOC. In the process, the “Professional specialty and 

technical” category became the “Professional and related” category. However, the coverage of the old and new 

occupational groups is approximately the same. See the BLS article, “Comparing Current and Former Industry and 

Occupation ECEC Series” (Weinstein and Loewenstein, 2004). 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule B-1 

1116 Appendix B – Recordkeeping and Reporting Burdens

1117 Table B-1 and Table B-2 present the estimated per-activity recordkeeping and reporting 

1118 burdens for accreditation bodies and third party certifiers, respectively. Table B-3 and Table B-4 

1119 present the estimated annual frequency of the recordkeeping and reporting activity as well as the 

1120 associated clerical, technical, and managerial cost. Total costs are calculated as the sum of the 

1121 component costs. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule B-2 

1122 

Table B-1: Recordkeeping and Reporting Burden for Accreditation Bodies, by Activity 

Activity1

Per Activity Burden Hours Number 

Annual 

Activitie

(d) 

Clerical Technical Managerial 

(a) (b) (c) 

1. Rule Familiarization 0.00 5.00 5.00 2. Application Submission 

Company Information (Name, Address, Telephone Number, and Email Address of Primary Contact)2 0.00 0.04 0.02 Documentation of IAF MLA, ILAC MRA, or Equivalent Signatory Status2 0.00 0.04 0.02 Description of Any Other Qualifications Related to Experience in Performing Accreditation of Conformity Assessment Bodies or Third Party Certifiers3 0.00 0.83 0.51 

3. Recognition Agreement4 1.00 1.00 4.00 4. EPA Notification 

Loss of Status as a Signatory to the IAF MLA, ILAC MRA, or Equivalent Organization5 0.00 0.08 0.04 Third Party Certifier Applications5 0.00 0.08 0.04 Third Party Certifier Accreditation5 0.00 0.08 0.04 Third Party Certifier Compliance Failure5 0.00 0.08 0.04 Third Party Certifier Accreditation Suspension or Revocation (Product ABs) / Accredited Laboratory Compliance Failure (Laboratory ABs)5 0.00 0.08 0.04 Change to Organizational Policy or Management Structure that Could Adversely Affect Accreditation Program5 0.00 0.08 0.04 Checklists and Other Records Documenting Compliance with the Requirements for Systems Audits and On-site Assessment of Third Party Certifiers5 0.00 0.08 0.04 Change in Name or Address of Domestic Agent (Foreign Entities Only)5 0.00 0.08 0.04 

5. Third Party Certifier Notification 

Unique Tracking Number2 0.00 0.04 0.02 Withdraw from or be Removed from Program2 0.00 0.04 0.02 

6. Recordkeeping 

Accreditation Applications6 0.75 1.50 0.75 Checklists and Other Records Documenting Compliance with the Requirements for Systems Audits and On-site Assessment of Third Party Certifiers6 0.75 1.50 0.75 

7. Annual Report to EPA 

Number of Third Party Certifier Applications Received7 0.25 0.50 0.25 Number of Third Party Certifier Applications Approved and Denied7 0.25 0.50 0.25 The Names and Contact Information of All Accredited Third Party Certifiers7 0.25 0.50 0.25 Number and Locations of Systems Audits and On-site Assessments7 0.25 0.50 0.25 Results of Accredited Third Party Certifier Laboratory Proficiency Testing or Interlaboratory Comparisons7 0.25 0.50 0.25 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule B-3 Table B-1: Recordkeeping and Reporting Burden for Accreditation Bodies, by Activity 

Activity1

Per Activity Burden Hours Number 

Annual 

Activitie

(d) 

Clerical Technical Managerial 

(a) (b) (c) 

Domestic Total in First Year Foreign Total in First Year Domestic Total in Year 2(Non-Reapplication Year) Foreign Total in Year 2 (Non-Reapplication Year) Domestic Total in Year 3 (Reapplication Year) Foreign Total in Year 3 (Reapplication Year) Notes: 1. Under the proposed rule, accreditation bodies are required to submit an application to renew their recognition agreement every three years. As a result, this anabodies incur application submission and recognition agreement preparation costs in the first year and subsequently every three years thereafter. 

2. Based on the estimated burden associated with reporting "company information" (EPA 2011a). 3. Based on the estimated burden associated with answering substantiation questions when making plant site confidentiality claims (EPA 2011a). 4. Based on conversations with accreditation bodies. 5. Based on the estimated burden associated with reporting "company information" (EPA 2011a). Values have been doubled based on best professional judgment. 

6. Based on the estimated burden associated with "recordkeeping" (EPA 2011a). The rule requires that records be kept for 3 years that show the 

production volume, plant site, and site-limited status of each reported substance. 7. Estimated as one-third of the burden associated with "recordkeeping" (EPA 2011a). Estimate based on best professional judgment.Sources: (1) U.S. Bureau of Labor Statistics. 2011. Employer Costs for Employee Compensation: Supplementary Tables: Historical Data: December 

U.S. Environmental Protection Agency. 2011a. Supporting Statement for a Request for OMB Review under the Paperwork Reduction Act: the Final RUpdate of the TSCA Section 8(b) TSCA Inventory Data Base, Production and Site Reports.

1123 1124 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule B-4 

Table B-2: Recordkeeping and Reporting Burden for Third Party Certifiers, by Activity 

 Per Activity Burden Hours Number 

Annua

Activitie

(d) 

Activity1

Clerical Technical Managerial 

(a) (b) (c) 

1. Rule Familiarization 0.00 5.00 5.00 2. Product Accreditation Body Application Submission 

Company Information (Name, Address, Telephone Number, and Email Address of Primary Contact) and Type of Composite Wood Products Applicant Intends to Certify2

0.00 0.04 0.02 

Description of TPC's Experience or Ability in Product Certification and Complying with ISO/IEC Guide 653 0.00 0.83 0.51 Description of TPC's Experience in the Composite Wood Product Industry with the Product(s) Intended to be Certified3 0.00 0.83 0.51 Description of TPC's Ability to Inspect and Properly Train and Supervise Inspectors Pursuant to ISO/IEC 170203 0.00 0.83 0.51 

3. Laboratory Accreditation Body Application Submission 

Company Information (Name, Address, Telephone Number, and Email Address of Primary Contact; if foreign, name and address of an agent for service located in the U.S.)2

0.00 0.04 0.02 

Description of TPC's Experience in Performing or Verifying Formaldehyde Testing on Composite Wood Products3 0.00 0.83 0.51 Description of TPC's Experience Operating or Using Laboratories that Comply with ISO/IEC 170253 0.00 0.83 0.51 Description of TPC's Experience with Test Method ASTM E-1333-96 (2002) and Experience Evaluating Correlation between Test Methods3 0.00 0.83 0.51 

4. Manufacturer Notification 

Third Party Certifier Number2 0.00 0.04 0.02 Withdraw from Program or Lose Accreditation2 0.00 0.04 0.02 

5. Recordkeeping 

List of Manufacturers and their Product Types (including Resins Used) Certified by TPC4 0.75 1.50 0.75 Results of Inspections, Audits, and Emission Tests Conducted for Each Manufacturer and Product Type4 0.75 1.50 0.75 List of the TPC's Laboratories, Test Methods (including Test Conditions and Conditioning Time), and Test Results4 0.75 1.50 0.75 Methods and Results for Establishing Test Method Correlations and Equivalence4 0.75 1.50 0.75 List of Manufacturers and Products Approved for Reduced Testing4 0.75 1.50 0.75 

6. Annual Report to Accreditation Bodies 

List of Manufacturers and their Products Certified by the TPC during the Previous Year (including Resins Used, and the Average and Range of Formaldehyde Emissions by Manufacturer, Resin, and Product Type)5

0.25 0.50 0.25 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule B-5 

Table B-2: Recordkeeping and Reporting Burden for Third Party Certifiers, by Activity 

 Per Activity Burden Hours Number 

Annua

Activitie

(d) 

Activity1

Clerical Technical Managerial 

(a) (b) (c) 

List of Noncomplying Products or Events by Manufacturer5 0.25 0.50 0.25 List of Laboratories and Test Methods Used by the TPC5 0.25 0.50 0.25 Results of Inter-Laboratory Comparison or Proficiency Testing for the Laboratories Used by the TPC4 0.25 0.50 0.25 

7. Accreditation Board Notification 

Personnel Qualification Changes2 0.00 0.04 0.02 Procedure Changes2 0.00 0.04 0.02 Laboratory Changes2 0.00 0.04 0.02 

8. EPA Notification 

Change in Name or Address of Domestic Agent (Foreign TPCs Only)2 0.00 0.04 0.02 

Domestic Total in First Year Foreign Total in First Year Domestic Total in Non-Reapplication Year Foreign Total in Non-Reapplications Year Domestic Total in Reapplication Year Foreign Total in Reapplications Year Notes: 1. Under the proposed rule, TPCs are required to apply for re-accreditation every three years. As a result, application and accreditation costs are incurred ev

2. Based on the estimated burden associated with reporting "company information" (EPA 2011a). 3. Based on the estimated burden associated with answering substantiation questions when making plant site confidentiality claims (EPA 2011a). 

4. Based on the estimated burden associated with "recordkeeping" (EPA 2011a). The rule requires that records be kept for 3 years that show the 

production volume, plant site, and site-limited status of each reported substance. 5. Estimated as one-third of the burden associated with "recordkeeping" (EPA 2011a). Estimate based on best professional judgment. 

Sources: (1) U.S. Bureau of Labor Statistics. 2011. Employer Costs for Employee Compensation: Supplementary Tables: Historical Data: Decem

and (2) U.S. Environmental Protection Agency. 2011a. Supporting Statement for a Request for OMB Review under the Paperwork Reduction Act: 

Addendum to Partial Update of the TSCA Section 8(b) TSCA Inventory Data Base, Production and Site Reports.

1125 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule B-6 Table B-3: Recordkeeping and Reporting Labor Costs for Accreditation Bodies, by Activity (2010$) 

Activity Estimated Annual Frequency1 Clerical Cost2 Technical Cost2 Mana

1. Rule Familiarization 1 $0.00 $281.55 2. Application Submission 

Company Information (Name, Address, Telephone Number, and Email Address of Primary Contact)3 1 $0.00 $2.25 Documentation of IAF MLA, ILAC MRA, or Equivalent Signatory Status3 1 $0.00 $2.25 Description of Any Other Qualifications Related to Experience in Performing Accreditation of Conformity Assessment Bodies or Third Party Certifiers4

1 $0.00 $46.74 

Application Submission Subtotal 

3. Recognition Agreement5 1 $25.65 $56.31 4. EPA Notification 

Loss of Status as a Signatory to the IAF MLA, ILAC MRA, or Equivalent Organization6 0.05 $0.00 $0.23 Third Party Certifier Application6 3 $0.00 $13.51 Third Party Certifier Accreditation6 3 $0.00 $13.51 Third Party Certifier Compliance Failure6 0.33 $0.00 $1.49 Third Party Certifier Accreditation Suspension or Revocation (Product ABs) / Accredited Laboratory Compliance Failure (Laboratory ABs)6 0.33 $0.00 $1.49 Change to Organizational Policy or Management Structure that Could Adversely Affect Accreditation Program6 0.2 $0.00 $0.90 Checklists and Other Records Documenting Compliance with the Requirements for Systems Audits and On-site Assessment of Third Party Certifiers6

1 $0.00 $4.50 

Change in Name or Address of Domestic Agent (Foreign Entities Only)6 0.5 $0.00 $2.25 EPA Notification Subtotal (Domestic) EPA Notification Subtotal (Foreign) 

5. Third Party Certifier Notification 

Unique Tracking Number3 3 $0.00 $6.76 Withdraw from or be Removed from Program3 0.25 $0.00 $0.56 TPC Notification Subtotal 

6. Recordkeeping 

Accreditation Applications7 1 $19.24 $84.47 Checklists and Other Records Documenting Compliance with the Requirements for Systems Audits and On-site Assessment of Third Party Certifiers7

1 $19.24 $84.47 

Recordkeeping Subtotal 

7. Annual Report to EPA 

Number of Third Party Certifier Applications Received8 1 $6.41 $28.16 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule B-7 Table B-3: Recordkeeping and Reporting Labor Costs for Accreditation Bodies, by Activity (2010$) 

Activity Estimated Annual Frequency1 Clerical Cost2 Technical Cost2 Mana

Number of Third Party Certifier Applications Approved and Denied8 1 $6.41 $28.16 The Names and Contact Information of All Accredited Third Party Certifiers8 1 $6.41 $28.16 Number and Locations of Systems Audits and On-site Assessments8 1 $6.41 $28.16 Results of Accredited Third Party Certifier Laboratory Proficiency Testing or Inter-laboratory Comparisons8 1 $6.41 $28.16 Annual Report Subtotal 

Domestic Total in First Year Foreign Total in First Year Domestic Total in Year 2(Non-Reapplication Year) Foreign Total in Year 2 (Non-Reapplication Year) Domestic Total in Year 3(Reapplication Year) Foreign Total in Year 3 (Reapplication Year) Notes: 1. Based on best professional judgment and rule requirements. Under the proposed rule, accreditation bodies are required to submit an application to renew their r

years. As a result, this analysis assumes that accreditation bodies incur application submission and recognition agreement preparation costs in the first year and subseque

2. Based on Employer Costs for Employee Compensation wage and benefit data for private professional and business services industries (BLS 2011a). Clerical costs are 

"office and administrative support" occupational group; technical costs are estimated using data from the "professional and related" occupational group; and managerial cfrom the "management, business, and financial" occupational group. 3. Based on the estimated burden associated with reporting "company information" (EPA 2011a). 4. Based on the estimated burden associated with answering substantiation questions when making plant site confidentiality claims (EPA 2011a). 5. Based on conversations with accreditation bodies. 6. Based on the estimated burden associated with reporting "company information" (EPA 2011a). Values have been doubled based on best professional judgment. 

7. Based on the estimated burden associated with "recordkeeping" (EPA 2011a). The rule requires that records be kept for 3 years that show the production volume, plan

each reported substance. 8. Estimated as one-third of the burden associated with "recordkeeping" (EPA 2011a). Estimate based on best professional judgment.

Sources: (1) U.S. Bureau of Labor Statistics. 2011. Employer Costs for Employee Compensation: Supplementary Tables: Historical Data: December 

U.S. Environmental Protection Agency. 2011a. Supporting Statement for a Request for OMB Review under the Paperwork Reduction Act: the Final RUpdate of the TSCA Section 8(b) TSCA Inventory Data Base, Production and Site Reports.

1126 1127 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule B-8 

Table B-4: Recordkeeping and Reporting Labor Costs for Third Party Certifiers, by Activity (2010$) 

Activity Estimated Annual Frequency1 Clerical Cost2 Technical Cost2 Manageria

1. Rule Familiarization 1.00 $0.00 $281.55 2. Product Accreditation Body Application Submission 

Company Information (Name, Address, Telephone Number, and Email Address of Primary Contact; if foreign, name and address of an agent for service located in the U.S.) and Type of Composite Wood Products Applicant Intends to Certify3

1.00 $0.00 $2.25 

Description of TPC's Experience or Ability in Product Certification and Complying with ISO/IEC Guide 654 1.00 $0.00 $46.74 Description of TPC's Experience in the Composite Wood 

Product Industry with the Product(s) Intended to be Certified4 1.00 $0.00 $46.74 

Description of TPC's Ability to Inspect and Properly Train and Supervise Inspectors Pursuant to ISO/IEC 170204 1.00 $0.00 $46.74 Product Accreditation Subtotal 

3. Laboratory Accreditation Body Application Submission 

Company Information (Name, Address, Telephone Number, and Email Address of Primary Contact; if foreign, name and address of an agent for service located in the U.S.)3

1.00 $0.00 $2.25 

Description of TPC's Experience in Performing or Verifying Formaldehyde Testing on Composite Wood Products4 1.00 $0.00 $46.74 Description of TPC's Experience Operating or Using Laboratories that Comply with ISO/IEC 170254 1.00 $0.00 $46.74 Description of TPC's Experience with Test Method ASTM E1333-96 (2002) and Experience Evaluating Correlation between Test Methods4

1.00 $0.00 $46.74 

Laboratory Accreditation Subtotal 

4. Manufacturer Notification 

Third Party Certifier Number3 1.00 $0.00 $2.25 Withdraw from Program or Lose Accreditation3 0.25 $0.00 $0.56 Manufacturer Notification Subtotal 

5. Recordkeeping 

List of Manufacturers and their Product Types (including Resins Used) Certified by TPC5 1.00 $19.24 $84.47 Results of Inspections, Audits, and Emission Tests Conducted for Each Manufacturer and Product Type5 1.00 $19.24 $84.47 List of the TPC's Laboratories, Test Methods (including Test Conditions and Conditioning Time), and Test Results5 1.00 $19.24 $84.47 Methods and Results for Establishing Test Method Correlations and Equivalence5 1.00 $19.24 $84.47 List of Manufacturers and Products Approved for Reduced Testing5 1.00 $19.24 $84.47 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule B-9 

Table B-4: Recordkeeping and Reporting Labor Costs for Third Party Certifiers, by Activity (2010$) 

Activity Estimated Annual Frequency1 Clerical Cost2 Technical Cost2 Manageria

Recordkeeping Subtotal 

6. Annual Report to Accreditation Bodies 

List of Manufacturers and their Products Certified by the TPC during the Previous Year (including Resins Used, and the Average and Range of Formaldehyde Emissions by Manufacturer, Resin, and Product Type)6

1.00 $6.41 $28.16 

List of Noncomplying Products or Events by Manufacturer6 1.00 $6.41 $28.16 List of Laboratories and Test Methods Used by the TPC6 1.00 $6.41 $28.16 Results of Inter-Laboratory Comparison or Proficiency Testing for the Laboratories Used by the TPC6 1.00 $6.41 $28.16 Annual Report to AB Subtotal 

7. Accreditation Board Notification 

Personnel Qualification Changes3 0.50 $0.00 $1.13 Procedure Changes3 0.50 $0.00 $1.13 Laboratory Changes3 0.50 $0.00 $1.13 Accreditation Board Notification Subtotal 

8. EPA Notification 

Change in Name or Address of Domestic Agent (Foreign TPCs Only)3 0.50 $0.00 $1.13 

Domestic Total in First Year Foreign Total in First Year Domestic Total in Non-Reapplication Year Foreign Total in Non-Reapplications Year Domestic Total in Reapplication Year Foreign Total in Reapplications Year Notes: 1. Based on best professional judgment and rule requirements. Under the proposed rule, TPCs are required to apply for re-accreditation every three years. As a 

accreditation costs are incurred every third year. 2. Based on Employer Costs for Employee Compensation wage and benefit data for private professional and business 

2011a). Clerical costs are estimated using data from the "office and administrative support" occupational group; technical costs are estimated using data from the "profe

occupational group; and managerial costs are estimated using data from the "management, business, and financial" occupational group. 3. Based on the estimated burde"company information" (EPA 2011a). 4. Based on the estimated burden associated with answering substantiation questions when making plant site confidentiality clai

5. Based on the estimated burden associated with "recordkeeping" (EPA 2011a). The rule requires that records be kept for 3 years that show the production volume, pla

of each reported substance. 6. Estimated as one-third of the burden associated with "recordkeeping" (EPA 2011a). Estimate based on best professional judgment. 

Sources: (1) U.S. Bureau of Labor Statistics. 2011. Employer Costs for Employee Compensation: Supplementary Tables: Historical Data: Decembe

(2) U.S. Environmental Protection Agency. 2011a. Supporting Statement for a Request for OMB Review under the Paperwork Reduction Act: the Fin

Partial Update of the TSCA Section 8(b) TSCA Inventory Data Base, Production and Site Reports. 1128 1129 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule C-1 

1130 

1131 Appendix C – Costs and Benefits of Electronic Reporting

1132 

1133 EPA is considering requiring mandatory electronic reporting requirement for 

1134 accreditation bodies and TPCs (both referred to here as respondents). If EPA adopts this 

1135 requirement for the TPC rule, respondents would submit their notifications and reports to EPA 

1136 using the Central Data Exchange (CDX). The costs and benefits to respondents and to EPA are 

1137 described below.

1138 

1139 C.1 Costs and Benefits of Electronic Reporting to Accreditation Bodies and TPCs

1140 

1141 All respondents incur costs in the first year to complete a subscriber agreement and 

1142 register with CDX. Some respondents will incur CDX costs in subsequent years due to 

1143 employee turnover or compromised electronic signatures. These costs are offset by reductions in 

1144 reporting and recordkeeping costs due to electronic reporting.

1145 

1146 CDX users are assigned to one of two roles in the CDX system, an Authorizing Official 

1147 or a Support Registrant.

1148 

1149 Authorized Official (AO): The AO is the person legally responsible for the submission. The 

1150 AO is typically a senior official for the respondent. The AO is the only user who can start a new 

1151 form, or reopen a completed form to begin the amendment process, and is the only user who can 

1152 electronically sign and submit a form. AOs can also assign Support Registrants to edit and 

1153 complete forms on his or her behalf. AOs must submit a subscriber agreement to EPA, and 

1154 register with CDX.

1155 

1156 Support Registrants: A Support Registrant is a person designated by an AO to submit 

1157 supporting documents on his or her behalf. Support Registrants can edit a submission that is 

1158 created by the AO. Support Registrants are only allowed to edit submissions that the AO has 

1159 granted him or her access. Support Registrants do not have any access rights to create or submit 

1160 a form. Once the AO creates a form, they will provide the Support Registrant with a passphrase 

1161 to access the submission and complete all sections of the form. Once the Support Registrant has 

1162 finished completing the form, the AO will access the submission, review it, and submit it. 

1163 Support Registrants must register with CDX, but do not need to submit a subscriber agreement to 

1164 EPA.

1165 

1166 This analysis uses a simplifying assumption that an average of five employees at each 

1167 respondent will register with CDX: one manager (who will serve as AO) four technical staff 

1168 members (who will serve as Support Registrants). 

1169 

1170 C.1.1 First Year Costs for Accreditation Bodies and TPCs 

1171 

1172 Respondents will incur electronic reporting costs in the first year to submit a subscriber 

1173 agreement, register with CDX, and contact EPA’s CDX Help Desk.

1174 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule C-2 

1175 Subscriber Agreement. An AO must complete a subscriber agreement in order to establish 

1176 their identity and their relation to the entity for which they will submit electronic documents, as 

1177 well as to document a unique correlation with the device that will be used to create their 

1178 electronic signature. Users can comply with the subscriber agreement provisions in CDX either 

1179 by submitting a paper subscriber agreement with a wet-ink signature, or by submitting an 

1180 electronic signature agreement.

1181 

1182 • Paper subscriber agreement. Preparing, submitting, and filing a paper subscriber agreement 

1183 is estimated to require an average of 20 minutes of time per registrant (EPA 2011b), which is 

1184 assumed to be managerial time. 

1185 

1186 • Electronic signature agreement. Preparing, submitting, and filing an electronic signature 

1187 agreement is estimated to require an average of 15 minutes of time per registrant (EPA 

1188 2011b), which is assumed to be managerial time. 

1189 

1190 CDX Registration. CDX users will need to register with CDX, which involves selecting a user 

1191 name and password, providing contact information, and identifying the facility and the 

1192 registrant’s role at the facility. This is estimated to take an average of 10 minutes per user (EPA 

1193 2011b). This results in an estimate that each respondent will spend 10 minutes of managerial 

1194 time and 40 minutes of technical time to register with CDX. 

1195 

1196 Help Desk. CDX users are assumed to spend an average of 4 minutes contacting EPA’s CDX 

1197 Help Desk for technical support (EPA 2011b), which results in an estimate of 4 minutes of 

1198 managerial time and 16 minutes of technical time per respondent. 

1199 

1200 Problem Resolution. Three percent of respondents each year are assumed to spend an average 

1201 of one hour of technical time working with EPA’s CDX Help Desk to resolve problems 

1202 involving their registrations or agreements (EPA 2011b).

1203 

1204 C.1.2 Subsequent Year Costs for Accreditation Bodies and TPCs

1205 

1206 In subsequent years, respondents may incur electronic reporting costs due to employee 

1207 turnover and compromised electronic signatures.

1208 

1209 Employee Turnover. It is assumed that each year 10 percent of CDX users will be replaced by 

1210 new employees, who will have to comply with the subscriber agreement and/or CDX registration 

1211 requirements (EPA 2011b). Thus, in subsequent years 10 percent of AOs will spend 15 to 20 

1212 minutes of managerial time to complete a subscriber agreement. In addition, 10 percent of all 

1213 users (both managerial and technical) will spend 10 minutes to register with CDX and 4 minutes 

1214 contacting EPA’s CDX Help Desk.

1215 

1216 Report Compromised Signature. Each year 1 percent of respondents are assumed to report a 

1217 compromised or surrendered electronic signature, which requires the submittal of a new 

1218 subscriber agreement (EPA 2011b). This will entail 15 to 20 minutes of managerial time to 

1219 prepare, submit, and file a new agreement, and 4 minutes of managerial time to contact EPA’s 

1220 CDX Help Desk.
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule C-3 

1221 

1222 C.1.3 Savings for Accreditation Bodies and TPCs

1223 

1224 Electronic reporting is assumed to reduce the recordkeeping burden by 50 percent, and to 

1225 eliminate the use of clerical time for reporting and recordkeeping(EPA 2009). For ABs, this is 

1226 estimated to result in average savings of 3.75 hours of clerical time in the first year and 2.75 

1227 hours in subsequent years, as well as 1 hour of technical time and 0.5 hours of managerial time in 

1228 all years. For TPCs, this is estimated to result in average savings of 4.75 hours of clerical time, 

1229 2.5 hours of technical time, and 1.25 hours of managerial time per year.

1230 

1231 Electronic reporting also has the following benefits for respondents:

1232 

1233 • The number of forms that need to be resubmitted because they are incomplete or invalid 

1234 should be greatly reduced because forms cannot be submitted via CDX if any required fields 

1235 are incomplete, or if the submission fails internal validation checks;

1236 

1237 • All of the respondent’s relevant staff will be able to access the CDX forms easily and directly 

1238 input their information, so the system will facilitate easier internal review by the respondent 

1239 prior to submission;

1240 

1241 • Filling out a form similar to one previously submitted will be faster with electronic reporting, 

1242 as the respondent will already have an electronic copy of the earlier form to edit rather than 

1243 having to fill out a new form; and

1244 

1245 • All routine correspondence with the Agency (including submission of supporting documents) 

1246 will be via CDX, which saves time and delivery costs and reduces delays in EPA’s review.

1247 

1248 EPA has not estimated the value of these additional savings to respondents. 

1249 

1250 C.1.4 Changes in Costs to Accreditation Bodies and TPCs due to Electronic 

1251 Reporting 

1252 

1253 As shown in Table C-1, accreditation bodies would accrue savings of $99 to $177 per 

1254 year (depending on whether it is the initial year, reapplication year, or non-reapplication year). 

1255 TPCs would accrue savings of $259 to $337 per year (depending on whether it is the initial year, 

1256 a reapplication year, or non-reapplication year), as shown in Table C-2. The total savings for 

1257 U.S. accreditation bodies would be $1,193 per year using a 3 percent discount rate and $1,146 

1258 per year using a 7 percent discount rate, as shown in Table C-3. As shown in Table C-4, the total 

1259 savings for U.S. TPCs would be $2,852 per year using a 3 percent discount rate and $2,754 per 

1260 year using a 7 percent discount rate. 

1261 

1262 As shown in Table C-5, electronic reporting via CDX would reduce the annualized costs 

1263 of the rule to U.S. accreditation bodies and respondents from $33,535 to $29,490 per year using a 

1264 3 percent discount rate, a savings of $4,045 per year. Using a 7 percent discount rate, costs are 

1265 estimated to decrease from $34,443 to $30,542, a savings of $3,900 per year. There are 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule C-4 

1266 additional unquantified improvements in efficiency and higher data quality due to electronic 

1267 reporting.

1268 

1269 As shown in Table C-6, electronic reporting via CDX would reduce the average total 

1270 burden hours for all 61 domestic and foreign respondents from 1,421 hours to 1,029 hours per 

1271 year, a savings of 392 hours per year. 

1272 

1273 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule C-5 

1274 

Table C-1: Incremental Cost of Electronic Reporting Requirements: Burden and Cost Per Accreditation Body 

Activity 

Per Activity Burden Hours Number 

of 

Annual 

Activities

(d) 

 Total Burden 

(hours) 

Total Cost 

Clerical Technical Managerial Clerical ($25.65/hr) Technical ($56.31/hr) Manageri

($66.78/hr

(a) (b) (c) (e) = (d)*{(a)+(b)+(c)} (f) (g) (h) 

1. CDX Electronic Reporting (First Year) 

Electronic Subscriber Agreements (domestic firms) - - 0.250 1.00 0.250 - - $16Paper Subscriber Agreements (foreign firms) - - 0.330 1.00 0.330 - - $22CDX Registration - 0.670 0.170 1.00 0.840 - $37.73 $1Help Desk - 0.270 0.070 1.00 0.340 - $15.20 $4Problem Resolution - 1.000 - 0.03 0.030 - $1.69 Subtotal (domestic) 1.460 Subtotal (foreign) 1.540 

2. CDX Electronic Reporting (Subsequent Years) 

Electronic Subscriber Agreements (domestic firms) - - 0.250 0.10 0.025 - - $Paper Subscriber Agreements (foreign firms) - - 0.330 0.10 0.033 - - $2CDX Registration - 0.670 0.170 0.10 0.084 - $3.77 $Help Desk - 0.270 0.070 0.10 0.034 - $1.52 $0Report Compromised Signature 0.400 0.01 0.004 - - $0Subtotal (domestic) 0.147 Subtotal (foreign) 0.155 

3. Recognition Agreement (1.000) - - 1.000 (1.000) $(25.65) - - 4. Recordkeeping 

Accreditation Applications (0.750) (0.500) (0.250) 1.000 (1.500) ($19.24) ($28.16) ($16Checklists and Other Records Documenting Compliance with the Requirements for Systems Audits and On-site Assessment of Third Party Certifiers 

(0.750) (0.500) (0.250) 1.000 (1.500) ($19.24) ($28.16) ($16

Subtotal (3.000) 

5. Annual Report to EPA 

Number of Third Party Certifier Applications Received (0.250) - - 1.000 (0.250) $(6.41) - - Number of Third Party Certifier Applications Approved and Denied (0.250) - - 1.000 (0.250) $(6.41) - - 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule C-6 Table C-1: Incremental Cost of Electronic Reporting Requirements: Burden and Cost Per Accreditation Body 

Activity 

Per Activity Burden Hours Number 

of 

Annual 

Activities

(d) 

 Total Burden 

(hours) 

Total Cost 

Clerical Technical Managerial Clerical ($25.65/hr) Technical ($56.31/hr) Manageri

($66.78/hr

(a) (b) (c) (e) = (d)*{(a)+(b)+(c)} (f) (g) (h) 

The Names and Contact Information of All Accredited Third Party Certifiers 

(0.250) - - 1.000 (0.250) $(6.41) - - 

Number and Locations of Systems Audits and On-site Assessments (0.250) - - 1.000 (0.250) $(6.41) - - Results of Accredited Third Party Certifier Laboratory Proficiency Testing or Inter-laboratory Comparisons 

(0.250) - - 1.000 (0.250) $(6.41) - - 

Subtotal (1.250) 

Domestic Total in First Year (3.790) Foreign Total in First Year (3.710) Domestic Total in Non-Reapplication Year (4.103) Foreign Total in Non-Reapplications Year (4.095) Domestic Total in Reapplication Year (5.103) Foreign Total in Reapplications Year (5.095) 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule C-7 Table C-1: Incremental Cost of Electronic Reporting Requirements: Burden and Cost Per Accreditation Body 

Activity 

Per Activity Burden Hours Number 

of 

Annual 

Activities

(d) 

 Total Burden 

(hours) 

Total Cost 

Clerical Technical Managerial Clerical ($25.65/hr) Technical ($56.31/hr) Manageri

($66.78/hr

(a) (b) (c) (e) = (d)*{(a)+(b)+(c)} (f) (g) (h) 

Notes: 1. CDX Electronic Reporting (first year): 

 Electronic signature agreement. Preparing, submitting, and filing an electronic signature agreement is estimated to require an average of 15 minutes of 

which is assumed to be managerial time (EPA 2011b). 

 Paper subscriber agreement. Preparing, submitting, and filing a paper subscriber agreement is estimated to require an average of 20 minutes of time pe

assumed to be managerial time (EPA 2011b). 

 CDX Registration. CDX users will need to register with CDX, which involves selecting a user name and password, providing contact information, and 

facility and the registrant’s role at the facility. This is estimated to take an average of 10 minutes per user (EPA 2011b). This results in an estimate th

spend 10 minutes of managerial time and 40 minutes of technical time to register with CDX. 

 Help Desk. CDX users are assumed to spend an average of 4 minutes contacting EPA’s CDX Help Desk for technical support (EPA 2011b), which re

minutes of managerial time and 16 minutes of technical time per respondent. 

 Problem Resolution. Three percent of respondents each year are assumed to spend an average of one hour of technical time working with EPA’s CDX 

problems involving their registrations or agreements (EPA 2011b). 

2. CDX Electronic Reporting (subsequent years): 

 Employee Turnover. It is assumed that each year 10 percent of CDX users will be replaced by new employees, who will have to comply with the subs

and/or CDX registration requirements (EPA 2011b). Thus, in subsequent years 10 percent of CDX users will spend 15 to 20 minutes of managerial tim

subscriber agreement. In addition, 10 percent of all CDX users (both managerial and technical) will spend 10 minutes to register with CDX and 4 minCDX Help Desk. 

 Report Compromised Signature. Each year 1 percent of respondents are assumed to report a compromised or surrendered electronic signature, which r

of a new subscriber agreement (EPA 2011b). This will entail 15 to 20 minutes (20 assumed here) of managerial time to prepare, submit, and file a new 

minutes of time to contact EPA’s CDX Help Desk. 



3. Recognition Agreement 

 Electronic reporting is assumed to eliminate the use of clerical time for the recognition agreement. 

4. Recordkeeping 

 Electronic reporting is assumed to reduce the recordkeeping burden by 50 percent (EPA 2009). 

5. Annual Report to EPA 

 Electronic reporting is assumed to reduce the recordkeeping burden by 50 percent (EPA 2009). 

Sources: (1) U.S. Bureau of Labor Statistics. 2011. Employer Costs for Employee Compensation: Supplementary Tables: Historical Data: December 

and (2) U.S. Environmental Protection Agency. 2011a. Supporting Statement for a Request for OMB Review under the Paperwork Reduction Act: the 

Addendum to Partial Update of the TSCA Section 8(b) TSCA Inventory Data Base, Production and Site Reports.

1275 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule C-8 Table C-2: Incremental Cost of Electronic Reporting Requirements: Burden and Cost Per Third Party Certifier 

Activity 

Per Activity Burden Hours Number 

of Annual 

Activities

(d) 

 Total Burden 

(hours) 

Total Cost 

Clerical Technical Manageria l Clerical ($25.65/hr) Technical ($56.31/hr) Manageri

($66.78/hr

(a) (b) (c) (e) = (d)*{(a)+(b)+(c)} (f) (g) (h) 

1. CDX Electronic Reporting (First Year) 

Electronic Subscriber Agreements (domestic firms) - - 0.250 1.00 0.250 - - $16.Paper Subscriber Agreements (foreign firms) - - 0.330 1.00 0.330 - - $22.CDX Registration - 0.670 0.170 1.00 0.840 - $37.73 $11.Help Desk - 0.270 0.070 1.00 0.340 - $15.20 $4.Problem Resolution - 1.000 - 0.03 0.030 - $1.69 Subtotal (domestic) 1.460 Subtotal (foreign) 1.540 

2. CDX Electronic Reporting (Subsequent Years) 

Electronic Subscriber Agreements (domestic firms) - - 0.250 0.10 0.025 $0.00 $0.00 $1.Paper Subscriber Agreements (foreign firms) - - 0.330 0.10 0.033 $0.00 $0.00 $2.CDX Registration - 0.670 0.170 0.10 0.084 $0.00 $3.77 $1.Help Desk - 0.270 0.070 0.10 0.034 $0.00 $1.52 $0.Report Compromised Signature - - 0.400 0.01 0.004 $0.00 $0.00 $0.Subtotal (domestic) 0.147 Subtotal (foreign) 0.155 

3. Manufacturer Notification and Recordkeeping 

List of Manufacturers and their Product Types (including Resins Used) Certified by TPC 

(0.750) (0.5) (0.25) 1.00 (1.500) ($19.24) ($28.16) ($16.7

Results of Inspections, Audits, and Emission Tests Conducted for Each Manufacturer and Product Type 

(0.750) (0.5) (0.25) 1.00 (1.500) ($19.24) ($28.16) ($16.7

List of the TPC's Laboratories, Test Methods (including Test Conditions and Conditioning Time), and Test Results 

(0.750) (0.5) (0.25) 1.00 (1.500) ($19.24) ($28.16) ($16.7

Methods and Results for Establishing Test Method Correlations and Equivalence 

(0.750) (0.5) (0.25) 1.00 (1.500) ($19.24) ($28.16) ($16.7
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule C-9 Table C-2: Incremental Cost of Electronic Reporting Requirements: Burden and Cost Per Third Party Certifier 

Activity 

Per Activity Burden Hours Number 

of Annual 

Activities

(d) 

 Total Burden 

(hours) 

Total Cost 

Clerical Technical Manageria l Clerical ($25.65/hr) Technical ($56.31/hr) Manageri

($66.78/hr

(a) (b) (c) (e) = (d)*{(a)+(b)+(c)} (f) (g) (h) 

List of Manufacturers and Products Approved for Reduced Testing 

(0.750) (0.5) (0.25) 1.00 (1.500) ($19.24) ($28.16) ($16.7

Subtotal (7.500) 

4. Annual Report and Notifications of Changes 

List of Manufacturers and their Products Certified by the TPC during the Previous Year (including Resins Used, and the Average and Range of Formaldehyde Emissions by Manufacturer, Resin, and Product Type) 

(0.250) - - 1.00 (0.250) ($6.41) - - 

List of Noncomplying Products or Events by Manufacturer (0.250) - - 1.00 (0.250) ($6.41) - - List of Laboratories and Test Methods Used by the TPC (0.250) - - 1.00 (0.250) ($6.41) - - Results of Inter-Laboratory Comparison or Proficiency Testing for the Laboratories Used by the TPC 

(0.250) - - 1.00 (0.250) ($6.41) - - 

Subtotal (1.00) 

Domestic Total in First Year (7.040) Foreign Total in First Year (6.960) Domestic Total in NonReapplication Year (8.353) Foreign Total in NonReapplications Year (8.345) Domestic Total in Reapplication Year (8.353) Foreign Total in Reapplications Year (8.345) 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule C-10 Table C-2: Incremental Cost of Electronic Reporting Requirements: Burden and Cost Per Third Party Certifier 

Activity 

Per Activity Burden Hours Number 

of Annual 

Activities

(d) 

 Total Burden 

(hours) 

Total Cost 

Clerical Technical Manageria l Clerical ($25.65/hr) Technical ($56.31/hr) Manageri

($66.78/hr

(a) (b) (c) (e) = (d)*{(a)+(b)+(c)} (f) (g) (h) 

Notes: 

1. CDX Electronic Reporting (first year): 

 Electronic signature agreement. Preparing, submitting, and filing an electronic signature agreement is estimated to require an average of 15 minutes of 

is assumed to be managerial time (EPA 2011b). 

 Paper subscriber agreement. Preparing, submitting, and filing a paper subscriber agreement is estimated to require an average of 20 minutes of time pe

assumed to be managerial time (EPA 2011b). 

 CDX Registration. CDX users will need to register with CDX, which involves selecting a user name and password, providing contact information, and 

facility and the registrant’s role at the facility. This is estimated to take an average of 10 minutes per registrant (EPA 2011b). This results in an estima

respondent will spend 10 minutes of managerial time and 40 minutes of technical time to register with CDX. 

 Help Desk. CDX users are assumed to spend an average of 4 minutes contacting EPA’s CDX Help Desk for technical support (EPA 2011b), which re

4 minutes of managerial time and 16 minutes of technical time per respondent. 

 Problem Resolution. Three percent of respondents each year are assumed to spend an average of one hour of technical time working with EPA’s CDX 

resolve problems involving their registrations or agreements (EPA 2011b). 

2. CDX Electronic Reporting (subsequent years): 

 Employee Turnover. It is assumed that each year 10 percent of CDX users will be replaced by new employees, who will have to comply with the subs

and/or CDX registration requirements (EPA 2011b). Thus, in subsequent years 10 percent of CDX users will spend 15 to 20 minutes of managerial tim

subscriber agreement. In addition, 10 percent of all registrants will spend 10 minutes to register with CDX and 4 minutes contacting EPA’s CDX Help subscriber agreement. Preparing, submitting, and filing a paper subscriber agreement is estimated to require an average of 20 minutes of time per regis

This results in an estimate of 20 minutes of managerial time per respondent submitting a paper subscriber agreement. 

 Report Compromised Signature. Each year 1 percent of respondents are assumed to report a compromised or surrendered electronic signature, which r

of a new subscriber agreement (EPA 2011b). This will entail 15 to 20 minutes (20 assumed here) of managerial time to prepare, submit, and file a new 

minutes of time to contact EPA’s CDX Help Desk. 

 Problem Resolution. Three percent of respondents each year are assumed to spend an average of one hour of technical time working with EPA’s CDX 

resolve problems involving their registrations or agreements (EPA 2011b). 

3. Recordkeeping 

 Electronic reporting is assumed to reduce the recordkeeping burden by 50 percent (EPA 2009). 

4. Annual Report to Recordkeeping Bodies 

 Electronic reporting is assumed to reduce the recordkeeping burden by 50 percent (EPA 2009). 

Sources: (1) U.S. Bureau of Labor Statistics. 2011. Employer Costs for Employee Compensation: Supplementary Tables: Historical Data: December 

2011, and (2) U.S. Environmental Protection Agency. 2011a. Supporting Statement for a Request for OMB Review under the Paperwork Reduction AcAddendum to Partial Update of the TSCA Section 8(b) TSCA Inventory Data Base, Production and Site Reports.

1276 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule C-11 Table C-3: U.S. Accreditation Body Cost Summary With Electronic Reporting Requirements 

Type of Cost Cost (2010$) First Year Reapplication Years1 N

Costs without CDX Requirements 

Rule Familiarization $615 $0 Application or Reapplication Process $88 $88 Prepare Recognition Agreement $349 $349 EPA Notification $57 $57 TPC Notification $12 $12 Recordkeeping $308 $308 Reporting $256 $256 Cost per Accreditation Body $1,685 $1,070 Number of Accreditation Bodies 8 8 Total Costs for U.S. Accreditation Bodies $13,480 $8,560 

Annualized Costs (30 years, 3 percent) $6,303 Annualized Costs (30 years, 7 percent) $6,320 

Incremental Costs for CDX Requirements 

CDX Registration $87 $9 Prepare Recognition Agreement ($26) ($26) Recordkeeping ($128) ($128) Reporting ($32) ($32) Cost per Accreditation Body ($99) ($177) Number of Accreditation Bodies 8 8 Total Costs for U.S. Accreditation Bodies ($792) ($1,416) 

Annualized Costs (30 years, 3 percent) ($1,193) Annualized Costs (30 years, 7 percent) ($1,146) 

Total Costs, Including Incremental Costs for CDX Requirements 

Rule Familiarization $615 $0 CDX Registration $87 $9 Application or Reapplication Process $88 $88 Prepare Recognition Agreement $323 $323 EPA Notification $57 $57 TPC Notification $12 $12 Recordkeeping $180 $180 Reporting $224 $224 Cost per Accreditation Body $1,586 $893 Number of Accreditation Bodies 8 8 Total Costs for U.S. Accreditation Bodies $12,688 $7,144 

Annualized Costs (30 years, 3 percent) $5,102 Annualized Costs (30 years, 7 percent) $5,167 

1277 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule C-12 Table C-4: U.S. TPC Cost Summary With Electronic Reporting Requirements 

Type of Cost 

Cost (2010$) 

First Year Reapplication Years1 N

Have 

Accred. 

Need 

Accred. 

Have Accred. Need Accred. Hav

Costs without Electronic Reporting Requirements 

Accreditation $0 $25,000 $0 $5,000 Rule Familiarization $615 $615 $0 $0 Application or Reapplication Process $492 $492 $492 $492 Manufacturer Notification and Recordkeeping $773 $773 $773 $773 Annual Report and Notifications of Changes $210 $210 $210 $210 Cost per TPC $2,090 $27,090 $1,475 $6,475 Number of TPCs 6 3 6 3 Total Costs for U.S. TPCs $12,540 $81,270 $8,850 $19,425 

Annualized Costs (30 years, 3 percent) $27,232 Annualized Costs (30 years, 7 percent) $28,123 

Incremental Costs for Electronic Reporting Requirements 

CDX Electronic Reporting $87 $87 $9 $9 Manufacturer Notification and Recordkeeping ($320) ($320) ($320) ($320) Annual Report and Notifications of Changes ($26) ($26) ($26) ($26) Cost per TPC ($259) ($259) ($337) ($337) Number of TPCs 6 3 6 3 Total Costs for U.S. TPCs ($1,554) ($777) ($2,022) ($1,011) 

Annualized Costs (30 years, 3 percent) ($2,852) Annualized Costs (30 years, 7 percent) ($2,754) 

Total Costs, Including Incremental Costs for Electronic Reporting Requirements 

Accreditation $0 $25,000 $0 $5,000 Rule Familiarization $615 $615 $0 $0 CDX Electronic Reporting $87 $87 $9 $9 Application or Reapplication Process $492 $492 $492 $492 Manufacturer Notification and Recordkeeping $453 $453 $453 $453 Annual Report and Notifications of Changes $184 $184 $184 $184 Cost per TPC $1,831 $26,831 $1,138 $6,138 Number of TPCs 6 3 6 3 Total Costs for U.S. TPCs $10,986 $80,493 $6,828 $18,414 

Annualized Costs (30 years, 3 percent) $24,380 Annualized Costs (30 years, 7 percent) $25,368 

1278 1279 1280 1281 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule C-13 Table C-5: Cost Summary for U.S. Accreditation Bodies and TPCs With Electronic Reporting Requirements 

Type of Cost Cost (2010$) First Year Reapplication Years1 N

Costs without CDX Requirements 

Accreditation Bodies $13,480 $8,560 Third Party Certifiers $93,810 $28,275 Total Costs $107,290 $36,835 

Annualized Costs (30 years, 3 percent) $33,535 Annualized Costs (30 years, 7 percent) $34,443 

Incremental Costs for CDX Requirements 

Accreditation Bodies ($792) ($1,416) Third Party Certifiers ($2,331) ($3,033) Total Costs ($3,123) ($4,449) 

Annualized Costs (30 years, 3 percent) ($4,045) Annualized Costs (30 years, 7 percent) ($3,900) 

Total Costs, Including Incremental Costs for CDX Requirements 

Accreditation Bodies $12,688 $7,144 Third Party Certifiers $91,479 $25,242 Total Costs $104,167 $32,386 

Annualized Costs (30 years, 3 percent) $29,490 Annualized Costs (30 years, 7 percent) $30,542 

1282 1283 1284 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule C-14 

1285 1286 

Table C-6: Total Bottom Line Burden and Costs (Domestic and Foreign)  Year 1 Year 2 Year 3 Average 

Costs without Electronic Reporting Requirements 

Number of Respondents and Responses 61 61 61 61Total Burden Hours 2,085.64 995.38 1,181.88 1,421Total Cost $417,470 $111,318 $122,243 $217,010

Incremental Burden and Costs for Electronic Reporting Requirements 

Number of Respondents and Responses 61 61 61 61Total Burden Hours (344.67) (402.93) (427.93) (392)Total Cost ($11,535) ($15,907) ($16,557) ($14,666)

Total Burden and Costs, Including Incremental Burden and Costs for Electronic Reporting Requirements

Number of Respondents and Responses 61 61 61 61Total Burden Hours 1,740.97 592.44 753.94 1,029Total Cost $405,935 $95,411 $105,686 $202,344 

1287 1288 1289 1290 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During the Review***

August 14, 2012 Economic Analysis for the TSCA Title VI Proposed Rule C-15 

1291 C.2 Costs and Benefits of Electronic Reporting to EPA 

1292 

1293 A portion of the cost that EPA incurs to operate the CDX system can be attributed to the 

1294 TSCA Title VI program. These costs are described below.

1295 

1296 CDX O&M – The cost of CDX operations and maintenance for TSCA Title VI electronic 

1297 reporting is estimated to be approximately $3,000 per year.

1298 

1299 CDX Application Support O&M – The cost of application support operations and maintenance 

1300 (for Help Desk support, resolving technical problems, software maintenance and upgrades, etc.) 

1301 for TSCA Title VI electronic reporting is estimated to be approximately $25,000 per year.

1302 

1303 CDX Software Licensing Costs – EPA’s cost of software licensing attributable to TSCA Title 

1304 VI is estimated to be approximately $6,000 per year.

1305 

1306 CDX CBI LAN O&M – The cost attributable of operations and maintenance of EPA’s 

1307 confidential business administration (CBI) local area network (LAN) attributable to TSCA Title 

1308 VI is estimated to be approximately $15,000 per year.

1309 

1310 EPA staff – Managing the CDX system related to the TSCA Title VI program is estimated to 

1311 require approximately 0.1 FTE per year of EPA staff. Based on the 2010 Washington/Baltimore 

1312 area annual salary rate for a GS-13, Step 5 employee ($100,904) and a loading factor of 1.6 for 

1313 overhead and fringe benefits, the cost of the EPA staff needed to manage the CDX program 

1314 attributable to the TSCA Title VI is estimated to be $16,145 per year. 

1315 

1316 Overall, EPA’s cost for operating the CDX system that can be attributed to the TSCA Title VI 

1317 program is estimated at $65,145 per year.

1318 

1319 The use of electronic reporting and CDX also has benefits for EPA. It is expected to 

1320 improve efficiency and lead to higher quality data being available more quickly to EPA. EPA 

1321 typically keys or scans in the data from paper submissions, which can result in errors. 

1322 Consequently, EPA must perform quality assurance checks on extracted and scanned 

1323 information. When data is submitted electronically, the time required for EPA staff to review 

1324 and process the information is reduced because manual data entry or processing is eliminated. 

1325 Electronic reporting also improves data quality because it facilitates data correction and 

1326 validation by highlighting fields with omitted or inconsistent data prior to submission. EPA has 

1327 not estimated the value of these efficiencies and improvements in data quality.

1328 

1329 1330