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May 1, 2013 Economic Analysis for the TSCA Title VI Implementation Rule 

1 EO 12866_RIN2070-AJ92_Formaldehyde-Imp_NPRM_EA_2013-05-03_MARKUP.docx 

2 

3 

4 

5 

6 

7 Economic Analysis of the Formaldehyde Standards 

8 for Composite Wood Products Act 

9 Implementing Regulations Proposed Rule 

10 

11 

12 RIN 2070-AJ92 

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14 

15 

16 

17 

18 EO 12866 REVIEW DRAFT 

19 

20 

21 

22 

23 

24 Economic and Policy Analysis Branch 

25 Economics, Exposure and Technology Division 

26 Office of Pollution Prevention and Toxics 

27 Office of Chemical Safety and Pollution Prevention 

28 U.S. Environmental Protection Agency 

29 

30 

31 

32 January 2012

33 May 2013

34 

35 

36 

37 

38 
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May 1, 2013 Economic Analysis for the TSCA Title VI Implementation Rule 

39 

40 

41 

42 

43 Acknowledgment

44 

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

46 Massachusetts in the preparation of this report, provided under Contract No. EP-W-08-10. 

47 

48 

49 

50 

Notice 

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. This is not an official guidance document and should not be relied 

upon to determine applicable regulatory requirements. 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. 
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May 1, 2013 i

1 Table of Contents 

2 

3 ES Executive Summary .................................................................................................................... ES-1 

4 1 Problem Definition and the Justification for Regulation .............................................................. 1

5 1.1 Problem with Formaldehyde Emissions from Composite Wood Products ........................................ 2

6 1.2 Regulatory Background ...................................................................................................................... 3

7 1.3 Justification for Regulation ................................................................................................................ 5

8 1.4 Alternative Regulatory Approaches for Reducing Exposure to Formaldehyde Emissions from 

9 Composite Wood Products ................................................................................................................. 7

10 2 Costs ................................................................................................................................................... 1

11 2.1 Estimated Number of Affected Entities .............................................................................................. 8

12 2.2 Third Party Testing and Certification Costs ..................................................................................... 38

13 2.3 Estimated Costs for Stock Hardwood Plywood, MDF, and Particleboard Producers ...................... 74

14 2.4 Estimated Costs for Wood Veneer Laminated Product Producers ................................................... 95

15 2.5 Recordkeeping, Labeling, Supplier Notification, and Rule Familiarization Costs ........................ 113

16 2.6 Total Costs of the Proposed TSCA Title VI Implementation Rule ................................................ 160

17 2.7 Summary of Costs by Entity Type and Activity for Options SI, SE, SCR, SEUR, and SCUR ..... 166

18 3 Benefits .............................................................................................................................................. 1

19 3.1 Estimating the Changes in Exposure by Analytical Option ............................................................... 8

20 3.2 Time Frame for the Analysis .............................................................................................................. 9

21 3.3 Assessing the Change in Cancer Risk .............................................................................................. 11

22 3.4 Estimating the Value of Reductions in Cancer Risk ........................................................................ 18

23 3.5 Estimating the Value of Non-cancer Risk Reductions ..................................................................... 45

24 3.6 Estimated Numbers of Affected Individuals .................................................................................... 63

25 3.7 Results of Benefits Assessment ........................................................................................................ 68

26 4 Net Benefits ....................................................................................................................................... 1

27 4.1 Discounting and Time Frame for the Analysis ................................................................................... 5

28 4.2 Summary of Net Benefits ................................................................................................................... 7

29 5 Small Business Impacts .................................................................................................................... 1

30 5.1 Small Business Impacts for Stock Panel Producers ........................................................................... 3

31 5.2 Small Business Impacts for Wood Veneer Laminated Product Producers (including firms making 

32 products defined as hardwood plywood ) ........................................................................................... 6

33 5.3 Small Business Impacts for Fabricators, Wholesalers, and Retailers ............................................... 19

34 5.4 Summary of Small Business Impacts ............................................................................................... 25

35 6 Environmental Justice and Other Impacts .................................................................................... 1

36 6.1 Environmental Justice ........................................................................................................................ 2

37 6.2 Employment Impact Analysis .......................................................................................................... 16

38 6.3 Paperwork Burden Analysis ............................................................................................................. 22

39 6.4 Unfunded Mandates Reform Act (UMRA) ...................................................................................... 25

40 6.5 Executive Order 13132 - Federalism ................................................................................................ 26

41 6.6 Executive Order 13175 - Tribal Implications ................................................................................... 27

42 6.7 Executive Order 13045 - Protection of Children .............................................................................. 28

43 6.8 Executive Order 13211 - Energy Effects .......................................................................................... 29

44 6.9 National Technology Transfer and Advancement Act ..................................................................... 30

45 R References ..................................................................................................................................... R-1 

46 A Appendix A: Product Lines Assumed to Include Composite Wood Products ....................... A-1

47 48 

49 
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May 1, 2013 ES-1 

50 Executive Summary 

51 

52 This report presents an economic analysis of the U.S. Environmental Protection Agency (EPA)’s 

53 proposed TSCA Title VI Implementation Rule. The Formaldehyde Standards for Composite Wood 

54 Products Act, which created Title VI of the Toxic Substances Control Act (TSCA), established 

55 formaldehyde emission standards for composite wood products (hardwood plywood, medium-density 

56 fiberboard (MDF), and particleboard) sold, supplied, offered for sale or manufactured in the United 

57 States. Under TSCA Title VI, manufacturers of composite wood products must comply with specific 

58 formaldehyde emission standards, and their compliance must be verified by a third-party certifier (TPC). 

59 Congress directed EPA to consider a number of elements for inclusion in implementing the regulations. 

60 These elements include: labeling, chain of custody requirements, sell-through provisions, ultra low61 emitting formaldehyde resins, no-added formaldehyde-based resins, finished goods, third-party testing 

62 and certification, auditing and reporting of TPCs, recordkeeping, enforcement, laminated products, and 

63 exceptions from the requirements of regulations promulgated for products and components containing de 

64 minimis amounts of composite wood products. 

65 

66 The sections of this executive summary below include an overview of the entities subject to 

67 the rule, the analytical options considered in the analysis, and the estimated costs, benefits, net benefits, 

68 and small business, environmental justice, and children’s health impacts of the rule. 

69 

70 Entities Subject to the Rule and their Baseline Status 

71 

72 The TSCA Title VI rule regulates panel producers, fabricators, distributors, and retailers of 

73 composite wood products. Panel producers manufacture composite wood products. Fabricators 

74 incorporate composite wood products into component parts or into finished goods. Wholesalers (referred 

75 to in the rule as distributors) supply composite wood products, component parts, or finished goods to 

76 others. And retailers sell composite wood products directly to consumers. 

77 

78 Due to the similarities between this proposal and the 2008 rule known as the Air Toxics Control 

79 Measure (ATCM) to reduce formaldehyde emissions from composite wood products that was 

80 promulgated by the California Air Resources Board (CARB), the incremental costs and benefits of this 

81 proposal are determined in part by the degree to which firms are already complying with the ATCM. So 

82 the following discussion of the number of entities subject to the TSCA Title VI rule includes an estimate 

83 of baseline compliance with the CARB ATCM. 

84 

85 Stock Panel Producers. Stock panel producers (also referred to as manufacturers) make hardwood 

86 plywood, MDF, or particleboard panels that would be classified as a composite wood products under both 

87 TSCA Title VI and the CARB ATCM. They are referred to as stock panel producers to differentiate them 

88 from custom hardwood plywood producers, which are not considered to be composite wood product 

89 manufacturers under the CARB ATCM. (Custom hardwood plywood producers are a type of wood 

90 veneer laminated product producers, which are considered to be fabricators rather than manufacturers of 

91 composite wood products under the CARB ATCM. Wood veneer laminated product producers are 

92 discussed in the next section.) 

93 

94 As shown in Table ES-1Table ES-1,, there are approximately 90 stock panel mills in the U.S. 

95 operated by 54 firms. This figure excludes mills and firms that only make products that are statutorily 

96 excluded from the TSCA Title VI rule (and that are also exempted from the CARB ATCM) such as 

97 curved plywood, military specified plywood, structural plywood, and wood-based structural-use panels. 

98 
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99 A total of 79 of the 90 U.S. stock panel mills have been certified as meeting the CARB Phase 2 

100 standards for at least one of their composite wood products. (The Phase 2 standards are equivalent to the 

101 emissions standards in the TSCA Title VI rule.) The CARB certified mills are responsible for virtually 

102 all the U.S. production volume of composite wood products. Approximately 99.6% of stock hardwood 

103 plywood produced in the U.S. is certified as meeting the CARB Phase 2 emissions standard, as is 100% 

104 of the MDF and 98% of the particleboard. 

105 

106 There are 16 U.S. stock panel mills making at least one product that is not certified as meeting the 

107 CARB Phase 2 standards. (Some of the 90 stock panel mills make both product lines that are certified 

108 under the CARB ATCM and product lines that are not certified because they are not intended to be sold 

109 in California.) 

110 

111 Wood Veneer Laminated Product Producers. Wood veneer laminated product producers (also referred 

112 to as laminators) make products by gluing a wood or woody grass veneer to the face and/or back of a 

113 purchased particleboard, MDF, or veneer core platform to produce a component part used in the 

construction or assembly of a finished good.1 114 Wood veneer laminated product producers are considered 

115 fabricators rather than hardwood plywood manufacturers under the CARB ATCM. In order to be sold in 

116 California, such products must be made using certified composite wood products as platforms, and they 

117 must comply with the labeling and chain of custody requirements in the CARB ATCM. But these 

118 products are not certified or tested for emissions. 

119 

120 TSCA Title VI includes laminated products in the definition of hardwood plywood, and directs 

121 EPA to conduct a rulemaking process to determine whether to exempt any of these products from the 

122 definition. If EPA does not exempt laminated products from the definition of hardwood plywood, then 

123 laminated products will have to be certified, tested, and meet the TSCA Title VI emissions standards, in 

124 addition to being made with certified platforms. Thus, the TSCA Title VI rulemaking will determine 

125 which wood veneer laminated product manufacturers are considered composite panel producers and 

126 which are considered solely fabricators. 

127 

128 There are 7,000 to 14,000 wood veneer laminated product producers in the U.S. making products 

129 such as custom hardwood plywood and architectural panels, windows, doors, kitchen cabinets, furniture, 

130 architectural woodwork and millwork, engineered wood flooring, and other goods made by affixing 

131 veneer to purchased platforms as part of the production process. 

132 

133 The estimate of 7,000 to 14,000 laminators excludes firms that use veneer to make products that 

134 are exempted from the definition of hardwood plywood because they do not create panels (flat or raised 

135 rectangular pieces of composite wood product) during the production process; the products are made by 

136 affixing veneer to substrates other than particleboard, MDF, or veneer core platforms; or the products are 

137 statutorily exempted by TSCA Title VI (including products used in boats and aircraft, and products not 

138 intended for interior use) or otherwise do not qualify as regulated hardwood plywood (such as curved 

139 plywood, military specified plywood, and structural plywood). 

140 

141 Fabricators. Fabricators use composite wood products to produce component parts or finished goods 

142 such as architectural components, cabinets, and furniture. There are 66,000 to 73,000 firms in the U.S. 

143 that are fabricators but not laminators, because they are using composite wood products to make goods 

 

1

 This analysis calls these products “wood veneer laminated products” to differentiate them from products that the industry 

commonly calls “laminates”, which are products that are laminated with materials other than veneer, such as high pressure 

laminate, thermally fused paper, vinyl film, decorative foil, or polypropylene film. Such products are not considered to be 

hardwood plywood under any of the options in this analysis. Firms making such products are considered fabricators under 

the rule, and are not counted as laminators. 
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May 1, 2013 ES-3 

144 without affixing veneer themselves. These 66,000 to 73,000 firms and the 7,000 to 14,000 laminators 

145 make up the 80,000 firms in the U.S. producing goods from composite wood products. Under the CARB 

146 ATCM, fabricated products sold in California must be made using certified composite wood products, 

147 and fabricators must comply with the ATCM’s labeling and chain of custody requirements. Nationwide, 

148 approximately 32,000 fabricators (including some laminators) are estimated to comply with the labeling 

149 and chain of custody requirements in the CARB ATCM because their products may be sold in California. 

150 

151 Wholesalers and Retailers. Wholesalers and retailers sell composite wood products. Approximately 

152 86,000 wholesalers (including importers) and 759,000 retailers in the U.S. are estimated to sell goods 

153 containing composite wood products. Approximately 32,000 of the wholesalers and 101,000 of the 

154 retailers have at least one facility in California, and thus must comply with the labeling and chain of 

155 custody requirements in the CARB ATCM. 

156 

157 

Table ES-1-1. : Number of Entities in the United States Subject to the Rule 

Type TSCA Universe 1

 Baseline Condition (CARB ATCM Universe) 2

Stock panel producers (i.e., 

manufacturers) 

90 mills operated by 54 

firms 

79 mills have been certified by CARB for at least one 

product, but 16 mills make at least one product that is not 

CARB certified. Depending on the product type, 98% to 

100% of U.S. production volume is CARB certified. 

Wood veneer laminated product 

producers (i.e., laminators) 

7,000 to 14,000 firms 3 Wood veneer laminated product producers are considered 

fabricators under the CARB ATCM. Nationally, 32,000 of 

the combined group are subject to CARB ATCM 

requirements. 

Fabricators 66,000 to 73,000 firms 3

Wholesalers 86,000 firms, of which 

24,000 are importers. 

32,000 are subject to CARB ATCM requirements, of 

which 9,000 are importers. 

Retailers 759,000 firms 101,000 are subject to CARB ATCM requirements. 

Total 925,000 firms 

1 The TSCA universe represents the estimated number of firms in the U.S. selling regulated composite wood products. 2 The CARB ATCM universe represents the estimated number of firms handling regulated composite wood products that may be 

sold in California. This represents the baseline for the TSCA Title VI rule.

3 The 7,000 to 14,000 wood veneer laminated product producers and the 66,000 to 73,000 fabricators that are not laminators sum 

to a total of 80,000 firms. 

158 

159 Analytical Options Considered 

160 

161 Table ES-2Table ES-2 presents the analytical options that are considered in this economic 

162 analysis. The analytical options can be grouped into two basic categories. The first category contains 

163 analytical options with emissions standards at the levels required by TSCA Title VI. Within this category 

164 there are several different options for how to regulate wood veneer laminated products. The second 

165 category contains emissions standards other than the levels required by TSCA Title VI. There is one set 

166 of options with the same emissions standards as Phase 1 of the CARB ATCM, and another set of options 

167 requiring all products to meet the NAF emissions standards. This document discusses options with 

168 alternative emissions standards simply for informational purposes. The breadth of the discussion here 

169 should not necessarily imply that EPA has corresponding flexibility in implementing the statute. 

170 
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May 1, 2013 ES-4 

Table ES-2: Analytical Options Considered in the Economic Analysis 

Analytical Option a Notes a

Analytical options with emissions standards at the levels required by TSCA Title VI b

Option SE: Statutory emissions standards where wood 

veneer laminated products are exempt from the 

definition of hardwood plywood

Laminators do not need TPC testing or certification. No 

ULEF certification. 

Option SI: Statutory emissions standards where wood 

veneer laminated products are included in the definition 

of hardwood plywood

All laminators must have products tested and certified by a 

TPC. No ULEF certification. 

Option SP: Statutory emissions standards where wood 

veneer laminated products other than Custom and 

Architectural Panel products are exempt from the 

definition of hardwood plywood

Only laminators making Custom or Architectural panels 

must have products tested and certified by a TPC. 

Laminators making other products do not need TPC testing 

or certification. No ULEF certification. 

Option SN: Statutory emissions standards where wood 

veneer laminated products made using NAF resins to 

attach wood veneers to NAF platforms are exempt from 

the definition of hardwood plywood

Laminators using NAF resins to attach wood veneers to 

NAF platforms do not need TPC testing and certification. 

Laminators making other products do not need TPC testing 

or certification. No ULEF certification. 

Option SC: Statutory emissions standards where wood 

veneer laminated products made with wood veneers 

attached to compliant platforms using no-added 

formaldehyde (NAF) resins are exempt from the 

definition of hardwood plywood

Laminators using NAF resins to attach wood veneers to 

compliant platforms do not need TPC testing and 

certification. Laminators making other products do not need 

TPC testing or certification. No ULEF certification. 

Option SCR: Statutory emissions standards where 

wood veneer laminated products made with wood 

veneers attached to compliant platforms using NAF 

resins are exempt from the definition of hardwood 

plywood. Reduced recordkeeping requirements for nonmanufacturers compared to other options.

Laminators using NAF resins to attach wood veneers to 

compliant platforms do not need TPC testing and 

certification. Laminators making other products do not need 

TPC testing or certification. No ULEF certification. 

Wholesalers and retailers that are not manufacturers under 

TSCA would only be required to keep invoices and bills of 

lading. No supplier notification required.

Option SEUR: Statutory emissions standards where 

wood veneer laminated products are exempt from the 

definition of hardwood plywood. ULEF certification 

allowed.c Reduced recordkeeping requirements for nonmanufacturers.

Laminators do not need TPC testing or certification. ULEF 

certification allowed. Wholesalers and retailers that are not 

manufacturers under TSCA would only be required to keep 

invoices and bills of lading. No supplier notification 

required.

Option SFCC: Statutory emissions standards with 

regulatory provisions that are fully consistent with 

CARB ATCM.

Tested lots may be shipped before test results are available. 

Laminators do not need TPC testing or certification. ULEF 

certification allowed. Panel producers and fabricators must 

label products. 

Option SCUR: Proposed Option. 

Statutory emissions standards where wood veneer 

laminated products made with wood veneers attached to 

compliant platforms using NAF resins are exempt from 

the definition of hardwood plywood. ULEF certification 

allowed. c Reduced recordkeeping requirements for nonmanufacturers.

Laminators using NAF resins to attach wood veneers to 

compliant platforms do not need TPC testing and 

certification. Other laminators must have products tested 

and certified by a TPC. ULEF certification allowed. 

Wholesalers and retailers that are not manufacturers under 

TSCA would only be required to keep invoices and bills of 

lading. No supplier notification required.

Analytical options with 

emissions standards other 

than the levels required by 

TSCA Title VI 

CARB 

Phase 1 

levels d

Option CE: CARB 1 emissions standards where wood 

veneer laminated products are exempt from the 

definition of hardwood plywood

Laminators do not need TPC testing or certification. 

Option CI: CARB 1 emissions standards where wood 

veneer laminated products are included in the definition 

of hardwood plywood

Laminators must have products tested and certified by a 

TPC. 

NAF 

emission 

levels e

Option NE: NAF emissions standards where wood 

veneer laminated products are exempt from the 

definition of hardwood plywood

Laminators do not need TPC testing or certification. 

Option NI: NAF emissions standards where all wood 

veneer laminated products are included in the definition 

of hardwood plywood

Laminators must have products tested and certified by a 

TPC. 

Note: This document discusses various options with respect to formaldehyde and composite wood products, including emissions standards that 

are different from those set in TSCA Title VI. This document discusses alternative emissions standards simply for informational purposes. 

The breadth of the discussion here should not necessarily imply that EPA has corresponding flexibility in implementing the statute.
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May 1, 2013 ES-5 

Table ES-2: Analytical Options Considered in the Economic Analysis a

 Panel producers must have products tested and certified by a TPC under all options. Recordkeeping and supplier notification requirements 

are equivalent to the CARB ATCM unless noted otherwise. 

b

 Emission levels for TSCA Title VI standard certification (and CARB Phase 2): Hardwood plywood = 0.05 ppm; MDF = 0.11 ppm; Thin 

MDF = 0.13 ppm; Particleboard = 0.09 ppm.

c Emission levels for ULEF certification with reduced quality control testing: Hardwood plywood: 90% of samples < 0.05 ppm and all 

samples < 0.05 ppm; MDF: 90% of samples < 0.06 ppm and all samples < 0.09 ppm; thin MDF: 90% of samples < 0.08 ppm and all samples 

< 0.11 ppm; Particleboard: 90% of samples < 0.05 ppm and all samples < 0.08 ppm. Emission levels for ULEF certification with quarterly 

TPC test exemption: Hardwood plywood: 90% of samples < 0.04 ppm and all samples < 0.05 ppm; MDF: 90% of samples < 0.04 ppm and 

all samples < 0.06 ppm; thin MDF: 90% of samples < 0.04 ppm and all samples < 0.06 ppm; Particleboard: 90% of samples < 0.04 ppm and 

all samples < 0.06 ppm. 

d

 Emission levels for CARB Phase 1: Hardwood plywood = 0.08 ppm; MDF = 0.21 ppm; Thin MDF = 0.21 ppm; Particleboard = 0.18 ppm. e

 Emission levels for NAF certification: Hardwood plywood: 90% of samples < 0.04 ppm and all samples < 0.05 ppm; MDF and 

particleboard: 90% of samples < 0.04 ppm and all samples < 0.06 ppm. 

171 

172 

173 Table ES-3 presents a summary of the different requirements under each analytical option. 

174 

175 

Table ES-3: Regulatory Requirements of the Analytical Options Considered in the Economic Analysis 

Regulatory Requirements Analytical Options Considered in the Economic Analysis

SE SI SP SN SC SCR SEUR SFCC SCUR CE CI NE NI

Emission standards at levels required by 

TSCA Title VI

        

Emissions standards at CARB Phase 1 

levels

 

Emission standards at NAF levels  

No wood veneer laminated products are 

defined as hardwood plywood

    

All wood veneer laminated products are 

defined as hardwood plywood

  

Certain wood veneer laminated products 

are defined as hardwood plywood

    

Recordkeeping and supplier notification 

consistent with CARB ATCM

         

Reduced recordkeeping for nonmanufacturers. No supplier 

notification.

  

ULEF certification allowed   

ULEF certification not allowed          

Tested lots must be held until results are 

available. Wholesalers that repackage 

must label products.

           

Tested lots may be shipped before 

results are available. Only panel 

producers and fabricators must label 

products.



Option SCUR is the proposed option.

176 

177 Costs 

178 

179 The cost of compliance with the rule includes changes to production process and raw materials 

180 that are needed to meet the emissions standards, as well as the costs of the testing, third-party 

181 certification, labeling, and chain of custody activities required by the rule. A summary of the activities 

182 associated with the incremental costs that firms are estimated to incur under the proposed option is 

183 presented in Table ES-4. 
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184 

Table ES-4: Activities with Incremental Costs Estimated Under Option SCUR (the proposed option) by Sector 

and Type

Activity

Panel Manufacturers

Fabricators

Wholesalers

Retailers

Laminators Other Fabricators

CARB 

compliant

Not CARB 

compliant

Use Added 

Formaldeh

yde Resins

Use 

NAF 

resins

CARB 

compliant

Not CARB 

compliant Importers

Not 

Importers

Become Familiar 

with TSCA rule Yes Yes Yes Yes Yes Yes Yes Yes Yes

Make Changes to 

Raw Materials Yes a Yes b

On-Site Daily 

Quality Control 

testing

Yes c Yes c Yes c

Have Products 

Tested and Certified 

by a TPC

Yes Yes d

Set Up Systems to 

Keep Additional 

Records 

Yes Yes e

Keep Additional 

Records Yes Yes Yes Yes f Yes f Yes e

Set Up to Label 

Products as TSCA 

Compliant

Yes Yes Yes Yes Yes Yes Yes g Yes g

a

 Some uncertified panel manufacturers will need to change their raw materials in order to meet the emissions standards.

b

 Most laminated product producers currently using add-formaldehyde resins will switch to NAF resins in order to avoid being defined as panel manufacturers. 

Some of the remaining laminated product producers that continue using added-formaldehyde resins will need to change their raw materials in order to meet the 

emissions standards. c The proposed rule includes a requirement that tested lots must be held until test results indicate that the emission standard has been met. The analysis assumes 

that some hardwood plywood producers required to perform quality control testing (including laminators using added-formaldehyde resins) will respond by 

conducting daily on-site quality control testing so that they can ship panels the same day that they are produced, instead of holding tested lots in inventory while 

waiting for the quality control testing to be performed by an off-site lab. Panel producers with an existing ULEF or NAF certification will already be exempted 

from quality control testing, and particleboard and MDF manufacturers are assumed to be conducting daily on-site quality control testing to comply with the 

CARB ATCM. d Laminators that use added-formaldehyde resin will need to have their products tested and certified by a TPC.

e

 Wholesalers that import composite wood products are defined as manufacturers under TSCA and are subject to the same recordkeeping requirements as 

manufacturers. Some of those importers that are not compliant with the CARB ATCM will incur costs to set up recordkeeping systems and ongoing costs to 

keep these additional records. f Some fabricators that are not compliant with the CARB ATCM will incur ongoing costs to keep additional records.

g. Wholesalers that repackage goods or replace an original label will incur set up costs to label the goods as TSCA compliant.

185 

186 Table ES-5 summarizes the first year, subsequent year, and annualized costs of the different 

187 analytical option. The total cost estimates are presented with low and high end scenarios, reflecting both 

188 the range in the estimated number of wood veneer laminated product producers (7,000 to 14,000 firms) 

189 and an assumption that they will certify and test either one or two different categories of product lines per 

190 firm. 

191 

192 
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Table ES-5-2: Total Costs by Analytical Options Considered in the Economic Analysis(millions 2010$)

Analytical Option 

Emissions 

Standards First 

Year

NotesSubsequent 

Years

Annualized Cost

(3% discount rate)

Low End 

Scenario

High End 

Scenario

Low End 

Scenario

High End 

Scenario

Low End 

Scenario

High End 

Scenario

Analytical options with emissions standards at the levels required by TSCA Title VI

Option SE: Statutory emissions standards where all

wood veneer laminated products are exempt from the 

definition of hardwood plywood

Hardwo

od 

plywoo

d MDF 

Thin 

MDF

Particl

eboar

d$595 

0.05 

ppm

0.11 

ppm

0.13 

ppm

0.09 

ppm$

595 

Same 

emissi

ons 

standa

rds as 

Phase 

2 of 

the 

CAR

B 

ATC

M. 

Recor

dkeep

ing 

and 

suppli

er 

notific

ation 

equiv

alent 

to 

CAR

B 

ATC

M.$79 

$79 $100 $100 

Option SI: Statutory emissions standards where all

wood veneer laminated products are included in the 

definition of hardwood plywood

Same 

as 

above

$919 

Same 

emiss

ions 

stand

ards 

as 

Phase 

2 of 

the 

CAR

B 

ATC

M, 

with a 

$177 $258 $204 $293 

Merged Cells

Inserted Cells

Formatted Table

Inserted Cells

Inserted Cells

Inserted Cells

Inserted Cells
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May 1, 2013 ES-8 

Table ES-5-2: Total Costs by Analytical Options Considered in the Economic Analysis(millions 2010$)

Analytical Option 

Emissions 

Standards First 

Year

NotesSubsequent 

Years

Annualized Cost

(3% discount rate)

Low End 

Scenario

High End 

Scenario

Low End 

Scenario

High End 

Scenario

Low End 

Scenario

High End 

Scenario

differ

ent 

defini

tion 

of 

hard

wood 

plyw

ood. 

Recor

dkeep

ing 

and 

suppli

er 

notifi

cation 

equiv

alent 

to 

CAR

B 

ATC

M.$1,

254 

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

May 1, 2013 ES-9 

Table ES-5-2: Total Costs by Analytical Options Considered in the Economic Analysis(millions 2010$)

Analytical Option 

Emissions 

Standards First 

Year

NotesSubsequent 

Years

Annualized Cost

(3% discount rate)

Low End 

Scenario

High End 

Scenario

Low End 

Scenario

High End 

Scenario

Low End 

Scenario

High End 

Scenario

Option SP: Statutory emissions standards where 

wood veneerall laminated products other than 

Custom Plywood and Architectural Panel 

productsPanels are exempt from the definition of 

hardwood plywood

Same 

as 

above

$600 

Same 

emiss

ions 

stand

ards 

as 

Phase 

2 of 

the 

CAR

B 

ATC

M, 

with a 

differ

ent 

defini

tion 

of

hard

wood 

plyw

ood. 

Recor

dkeep

ing 

and 

suppli

er 

notifi

cation 

equiv

alent 

to 

CAR

B 

ATC

M.$60

0 

$82 $82 $104 $104 

Option SN: Statutory emissions standards where all

wood veneer laminated products made using NAF 

resins to attach wood veneers to NAF platforms are 

Same 

as 

Same 

emiss $108 $118 $128 $137 

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

May 1, 2013 ES-10 

Table ES-5-2: Total Costs by Analytical Options Considered in the Economic Analysis(millions 2010$)

Analytical Option 

Emissions 

Standards First 

Year

NotesSubsequent 

Years

Annualized Cost

(3% discount rate)

Low End 

Scenario

High End 

Scenario

Low End 

Scenario

High End 

Scenario

Low End 

Scenario

High End 

Scenario

exempt from the definition of hardwood plywood. above

$626 

ions 

stand

ards 

as 

Phase 

2 of 

the 

CAR

B 

ATC

M, 

with a 

differ

ent 

defini

tion 

of 

hard

wood 

plyw

ood. 

Recor

dkeep

ing 

and 

suppli

er 

notifi

cation 

equiv

alent 

to 

CAR

B 

ATC

M.$63

9 

Option SC: Statutory emissions standards where 

laminated products made with compliant platforms and 

NAF resins are exempt from the definition of 

hardwood plywood.

$609 $621 $91 $101 $112 $121 

Option SCSCR: Statutory emissions standards where 

wood veneer laminated products made with wood 

Same 

as 

Same 

emissi $56 $66 $72 $81 

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

May 1, 2013 ES-11 

Table ES-5-2: Total Costs by Analytical Options Considered in the Economic Analysis(millions 2010$)

Analytical Option 

Emissions 

Standards First 

Year

NotesSubsequent 

Years

Annualized Cost

(3% discount rate)

Low End 

Scenario

High End 

Scenario

Low End 

Scenario

High End 

Scenario

Low End 

Scenario

High End 

Scenario

veneers attached to compliant platforms using noadded formaldehyde (NAF) resins are exempt from the 

definition of hardwood plywood. Reduced 

recordkeeping requirements for non-manufacturers 

compared to other options.

above

$435 

ons 

standar

ds as 

Phase 

2 of 

the 

CARB 

ATCM

, with a 

differe

nt 

definiti

on of 

hardwo

od 

plywoo

d. 

Record

keepin

g and 

supplie

r 

notific

ation 

equival

ent to 

CARB 

ATCM

.

$447 

Option SEUR: Statutory emissions standards where 

wood veneer laminated products are exempt from the 

definition of hardwood plywood. ULEF certification 

allowed.c Reduced recordkeeping requirements for 

non-manufacturers.

$420 $420 $44 $44 $60 $60 

Option SFCC: Statutory emissions standards with 

regulatory provisions that are fully consistent with 

CARB ATCM.

$594 $594 $78 $78 $100 $100 

Option SCRSCUR: Proposed Option. 

Statutory emissions standards where wood veneer 

laminated products made with wood veneers attached 

to compliant platforms using NAF resins are exempt 

from the definition of hardwood plywood. ULEF 

certification allowed. c Reduced recordkeeping 

requirements for non-mfgrs. compared to other 

options. manufacturers.

Same 

as 

above

$434 

Same 

emissi

ons 

standar

ds as 

Phase 

2 of 

the 

CARB 

ATCM

, with a 

differe

nt 

definiti

on of 

hardwo

od 

$56 $65 $72 $81 

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

May 1, 2013 ES-12 

Table ES-5-2: Total Costs by Analytical Options Considered in the Economic Analysis(millions 2010$)

Analytical Option 

Emissions 

Standards First 

Year

NotesSubsequent 

Years

Annualized Cost

(3% discount rate)

Low End 

Scenario

High End 

Scenario

Low End 

Scenario

High End 

Scenario

Low End 

Scenario

High End 

Scenario

plywoo

d

Distri

butor

s and 

retail

ers 

that 

are 

not 

manu

factur

ers 

under 

TSC

A

woul

d 

only 

be 

requir

ed to 

keep 

invoi

ces 

and 

bills 

of 

ladin

g. 

Other 

recor

dkeep

ing 

equiv

alent 

to 

CAR

B

ATC

M. 

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May 1, 2013 ES-13 

Table ES-5-2: Total Costs by Analytical Options Considered in the Economic Analysis(millions 2010$)

Analytical Option 

Emissions 

Standards First 

Year

NotesSubsequent 

Years

Annualized Cost

(3% discount rate)

Low End 

Scenario

High End 

Scenario

Low End 

Scenario

High End 

Scenario

Low End 

Scenario

High End 

Scenario

No 

suppli

er 

notifi

cation 

requir

ed.$44

7 

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

May 1, 2013 ES-14 

Table ES-5-2: Total Costs by Analytical Options Considered in the Economic Analysis(millions 2010$)

Analytical Option 

Emissions 

Standards First 

Year

NotesSubsequent 

Years

Annualized Cost

(3% discount rate)

Low End 

Scenario

High End 

Scenario

Low End 

Scenario

High End 

Scenario

Low End 

Scenario

High End 

Scenario

Analytical options with emissions standards other than the levels required by TSCA Title VIthe statute

CARB Phase 1 levels

Option CE: CARB 1 emissions standards where all

wood veneer laminated products are exempt from the 

definition of hardwood plywood

Hardwo

od 

plywoo

d MDF 

Thin 

MDF

Particl

eboar

d$593 

0.08 

ppm

0.21 

ppm

0.21 

ppm

0.18 

ppm$

593 

Same 

emissi

ons 

standa

rds as 

Phase 

1 of 

the 

CAR

B 

ATC

M. 

Recor

dkeep

ing 

and 

suppli

er 

notific

ation 

equiv

alent 

to 

CAR

B 

ATC

M.$78 

$78 $99 $99 

Option CI: CARB 1 emissions standards where all

wood veneer laminated products are included in the 

definition of hardwood plywood

Same 

as 

above

$918 

Same 

emiss

ions 

stand

ards 

as 

Phase 

1 of 

the 

CAR

B 

ATC

M, 

with a 

$176 $257 $203 $292 

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

May 1, 2013 ES-15 

Table ES-5-2: Total Costs by Analytical Options Considered in the Economic Analysis(millions 2010$)

Analytical Option 

Emissions 

Standards First 

Year

NotesSubsequent 

Years

Annualized Cost

(3% discount rate)

Low End 

Scenario

High End 

Scenario

Low End 

Scenario

High End 

Scenario

Low End 

Scenario

High End 

Scenario

differ

ent 

defini

tion 

of 

hard

wood 

plyw

ood. 

Recor

dkeep

ing 

and 

suppli

er 

notifi

cation 

equiv

alent 

to 

CAR

B 

ATC

M.$1,

253 

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

May 1, 2013 ES-16 

Table ES-5-2: Total Costs by Analytical Options Considered in the Economic Analysis(millions 2010$)

Analytical Option 

Emissions 

Standards First 

Year

NotesSubsequent 

Years

Annualized Cost

(3% discount rate)

Low End 

Scenario

High End 

Scenario

Low End 

Scenario

High End 

Scenario

Low End 

Scenario

High End 

Scenario

NAF emission levels Option NE: NAF emissions standards where all wood 

veneer laminated products are exempt from the 

definition of hardwood plywood

Hardwo

od 

plywoo

d: 

90% of 

samples 

< 0.04 

ppm. 

All 

samples 

< 0.05 

ppm.

MDF 

and 

particle

board: 

90% of 

samples 

< 0.04 

ppm. 

All 

sampl

es < 

0.06 

ppm$8

89 

Requi

res all 

comp

osite 

wood 

produ

ct 

manu

factur

ers to 

meet 

NAF 

emiss

ion 

stand

ards. 

Recor

dkeep

ing 

and 

suppli

er 

notifi

cation 

equiv

alent 

to 

CAR

B 

ATC

M.$88

9 

$372 $372 $379 $379 

Option NI: NAF emissions standards where all wood 

veneer laminated products are included in the 

definition of hardwood plywood 

Same 

as 

above

$1,214 

Requi

res all 

comp

osite 

wood 

produ

ct 

manu

factur

$471 $552 $484 $573 

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

May 1, 2013 ES-17 

Table ES-5-2: Total Costs by Analytical Options Considered in the Economic Analysis(millions 2010$)

Analytical Option 

Emissions 

Standards First 

Year

NotesSubsequent 

Years

Annualized Cost

(3% discount rate)

Low End 

Scenario

High End 

Scenario

Low End 

Scenario

High End 

Scenario

Low End 

Scenario

High End 

Scenario

ers to 

meet 

NAF 

emiss

ion 

stand

ards, 

with a 

differ

ent 

defini

tion 

of 

hard

wood 

plyw

ood. 

CAR

B 

recor

dkeep

ing

and 

suppli

er 

notifi

cation

.$1,54

9 

Note: This document discusses various options with respect to formaldehyde and composite wood products, 

including emissions standards that are different from those set in TSCA Title VI. This document discusses 

alternative emissions standards simply for informational purposes. The breadth of the discussion here should 

not necessarily imply that EPA has corresponding flexibility in implementing the statute.Option SCUR is the 

proposed option.

193 

194 Table ES-3 summarizes the first year, subsequent year, and annualized costs of the different 

195 analytical option. For the options with emissions requirements that are consistent with TSCA Title VI 

196 (Options SE, SI, SP, SN, SC, SCR, SEUR, SFCC, and SCRSCUR), the first year costs range from 

197 $435420 million to $1,254 million and the annualized costs range from $7260 million to $293 million per 

198 year. The proposed option (Option SCRSCUR) has first year costs of $435434 million to $447 million. 

199 The annualized costs under Option SCRSCUR range from $72 million to $81 million per year, which is 

200 $23 to $3212 million lessto $21 million more than the next least expensive option with emissions 

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May 1, 2013 ES-18 

201 requirements that are consistent with the statute (Option SESEUR). The annualized costs under Options 

202 SCRSCUR are about 3519 to 28 percent lower compared to Option SCSFCC. The primary difference 

203 between the costs under Option SCRSCUR (the proposed option) and Option SCSFCC (the option fully 

204 consistent with CARB) is that Option SCR hasa result of reduced recordkeeping requirements for 

205 wholesalers and retailers that are not manufacturers under TSCA (i.e., that do not import, produce, or 

206 manufactureof composite wood products). (where manufacturing is defined under TSCA to include 

207 importing). These reduced recordkeeping costs are slightly offset by: (1) exempting only those wood 

208 veneer laminated product producers that make laminated products with wood veneers attached to 

209 compliant platforms using NAF resins under SCUR compared to exempting all wood veneer laminated 

210 product producers under SFCC, and (2) requiring mills to wait until test results indicate that the emissions 

211 standards have been met before shipping a lot that has been tested under option SCUR compared to 

212 allowing the shipping of tested lots before test results are available under option SFCC. Option SEUR 

213 differs from the proposed option (SCUR) by extending the wood veneer laminated products exemption to 

214 all wood veneer laminated product producers, not just those that produce laminated products by affixing a 

215 veneer to a compliant platform using NAF resins.

216 

217 Options CE and CI, the least stringent options in terms of emissions standards (which are 

218 presented for information purposes since they are not consistent with the emissions requirements of the 

219 statute), have estimated annualized costs ranging from $99 to $292 million per year. The estimated costs 

220 under Options CE and CI are similar to the estimated costs under the options with emissions requirements 

221 consistent with the statute, because recordkeeping, labeling, testing and certification are the primary cost 

222 drivers and loosening emissions standards does not affect these costs. 

223 

224 Options NE and NI, the most stringent options in terms of emissions standards (which are also 

225 presented for information purposes since they are not consistent with the emissions requirements of the 

226 statute), have estimated annualized costs ranging from $379 to $573 million. The additional costs 

227 associated with changes to raw materials and production processes account for the difference between the 

228 costs under these options compared to the options with emissions requirements that are consistent with 

229 the statute (SE, SI, SP, SN, SC, SCR, SEUR, SFCC, and SCRSCUR). 

230 

231 Table ES-6Table ES-4 summarizes the total annualized costs using both a 3 percent and a 7 

232 percent discount rate. The results are similar under both discount rates. 

233 

234 Table ES-7Table ES-5 presents the costs by type of entity for the proposed option (Option 

235 SCRSCUR). Stock panel producers represent a small share of total costs, reflecting both the small 

236 number of firms and their high rate of baseline compliance with the CARB ATCM emission levels. 

237 Retailers represent the largest number of firms subject to the rule and the largest share of total first year 

238 costs due to rule familiarization. In subsequent years retailers are only required to keep invoices and bills 

239 of lading. (Rule familiarization represents the time spent becoming familiar with the requirements of the 

240 rule.) In addition to taking reasonable precautions to ensure that they are purchasing composite wood 

241 products that comply with the emissions standards and the other requirements of the rule, retailers are 

242 subject to recordkeeping provisions that require them to keep invoices and bills of lading. These records 

243 are typically kept as a customary business practice, so no subsequent year costs are attributed to retailers. 

244 As a result, retailers represent a small share of annualized costs. Fabricators and laminators make up the 

245 largest share of the total annualized costs. These costs are largely driven by the certification and testing 

246 requirements for laminators that are considered panel producers under the rule, and by the additional 

247 recordkeeping required to comply with the rule’s chain of custody requirements. 

248 Under the proposed option, wood veneer laminated products are regulated as hardwood plywood 

249 unless they are made using no-added formaldehyde (NAF) resins to affix the veneer to compliant and 

250 certified platforms. Of the 7,000 to 14,000 wood veneer laminated product producers in the U.S., 2,700 

251 to 4,000 are assumed to be using formaldehyde-based resins. It is generally less expensive for a laminator 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 ES-19 

252 to switch to a NAF resin than to pay for the certification and product testing required for panel producers. 

253 As a result, nearly all laminators using formaldehyde-based resins are likely to switch to NAF resins in 

order to qualify for the exemption from the definition of hardwood plywood.2 254 It is assumed that only 

255 about 150 to 300 U.S. laminated product producers will continue using formaldehyde-based resins, and 

256 thus will need to certify and test their products as a result of this proposal. 

257 

 2

 Composite wood platforms sold in the U.S. for use in wood veneer laminated products are assumed to be compliant and 

certified once the TSCA Title VI rule is implemented. Laminators using NAF resins to affix veneer to compliant and 

certified platforms will be regulated as fabricators. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 ES-20 

Table ES-6-3: : Total Annualized Costs by Analytical Option (millions, 2010$, 3 

percent discount rate)$)

Analytical Option First Year3 Percent Discount 

Rate

Subsequent Years7 Percent 

Discount Rate

Annualized 

Cost

Low 

End 

Scenari

o

High 

End 

Scenari

o

Low End Scenario

High 

End 

Scenari

o

Low End 

Scenario

High 

End 

Scenario

Analytical options with emissions standards at the levels required by the statute

Option SE: Statutory emissions 

standards where all wood veneer 

laminated products are exempt from 

the definition of hardwood plywood

$595 $595 $79 $79 $100 $100 

Option SI: Statutory emissions 

standards where all wood veneer 

laminated products are included in 

the definition of hardwood plywood

$919 $1,2

54 $177 $258 $194 $293 

Option SP: Statutory emissions 

standards where all laminated 

products other than Custom 

Plywood and Architectural Panels 

are exempt from the definition of 

hardwood plywood

$600 $600 $83 $83 $104 $104 

Option SN: Statutory emissions 

standards where all wood veneer 

laminated products made using 

NAF resins to attach wood veneers 

to NAF platforms are exempt from

the definition of hardwood 

plywood.

$654 $689 $136 $168 $143 $185 

Option SC: Statutory emissions 

standards where laminated products 

made with compliant platforms and 

NAF resins are exempt from the 

definition of hardwood plywood.

$609 $621 $91 $101 $112 $121 

Option SCR: Proposed Option. 

Statutory emissions standards where 

laminated products made with 

compliant platforms and NAF 

resins are exempt from the 

definition of hardwood plywood.

Reduced recordkeeping 

requirements for non-manufacturers 

compared to other options.

$435 $447 $57 $66 $72 $81 

Analytical options with emissions 

standards other than the levels 

required by the statute

CARB Phase 1

Option CE: CARB 1 emissions 

standards where all wood veneer 

laminated products are exempt from 

the definition of hardwood plywood

$593 $593 $78 $78 $99 $99 

Option CI: CARB 1 emissions 

standards where all wood veneer 

laminated products are included in 

the definition of hardwood plywood

$918 $1,2

53 $176 $257 $192 $292 

NAF emission

Option NE: NAF emissions 

standards where all wood veneer 

laminated products are exempt 

from the definition of hardwood 

plywood

$889 $889 $372 $372 $379 $379 

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

May 1, 2013 ES-21 

Table ES-6-3: : Total Annualized Costs by Analytical Option (millions, 2010$, 3 

percent discount rate)$)

Analytical Option First Year3 Percent Discount 

Rate

Subsequent Years7 Percent 

Discount Rate

Annualized 

Cost

Low 

End 

Scenari

o

High 

End 

Scenari

o

Low End Scenario

High 

End 

Scenari

o

Low End 

Scenario

High 

End 

Scenario

Option NI: NAF emissions 

standards where all wood veneer 

laminated products are included in 

the definition of hardwood plywood

$1,21

4 

$1,5

49 $471 $552 $473 $573 

Option SCR is the proposed option.

258 

Table ES-4: Total Annualized Costs by Analytical Option (millions, 2010$)

Analytical Option 3 Percent Discount Rate 7 Percent Discount Rate

Low End Scenario High End Scenario Low End Scenario High End Scenario

Option SE $100 $100 $112 $112 

Option SI $194 204 $293 $208218 $311 

Option SP $104 $104 $115 $115 

Option SN $143128 $185137 $154139 $195148 

Option SC $112 $121 $123 $132 

Option SCR $72 $81 $80 $89 

Option SEUR $60 $60 $68 $68 

Option SFCC $100 $100 $111 $111 

Option SCRSCUR (Proposed 

Option) $72 $81 $8180 $89 

Option CE $99 $99 $111 $111 

Option CI $192203 $292 $207217 $310 

Option NE $379 $379 $383 $383 

Option NI $473484 $573 $480490 $582 

Option SCRSCUR is the proposed option. 

259 

Table ES-7-5: : Costs for Proposed Option by Type of Entity (millions 2010$, 3 percent discount 

rate)$) 1

Analytical Option Entity Type 

First Year Subsequent 

Years 

Annualized Cost

(3% discount rate)

Low End 

Scenario

High End 

Scenario

Low End 

Scenario

High End 

Scenario

Low End 

Scenario 

High End 

Scenario 

Option SCR: Proposed Option. 

Statutory emissions standards 

where laminated products made 

with compliant platforms and NAF 

resins are exempt from the 

definition of hardwood plywood.

Reduced paperwork requirements 

compared to other options.Option 

SCUR: Proposed Option.

Stock Panel Producers $32 $32 $21 $21 $21 $21 

Fabricators 2 $91 $57 $24 $20 $26 $21 

Retailers $215 $215 $0 $0 $10 $10 

Wholesalers $71 $71 $14 $14 $16 $16 

Laminators 3 $55 $102 $17 $30 $18 $32 

Total $43543

4 $447 $5756 $6665 $72 $81 

Option SCR is the proposed option. 1

 Low and high end scenarios reflect the estimated number of laminators and the number of product lines certified per firm, not the 

low and high costs for each category of entities. 

2 To avoid double-counting, this row represents costs to fabricators that are not laminators. Costs under the “Low End Scenario”

reflect the low end of the estimated number of laminators (approximately 7,000 firms), and costs under the “High End Scenario” 

reflect the high end estimate of the number of laminators (approximately 14,000 firms). The estimated number of fabricators that are 

not laminators is inversely proportional to the estimated number of laminators. So in the Low End Scenario there are 73,000 

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

May 1, 2013 ES-22 

Table ES-7-5: : Costs for Proposed Option by Type of Entity (millions 2010$, 3 percent discount 

rate)$) 1

Analytical Option Entity Type 

First Year Subsequent 

Years 

Annualized Cost

(3% discount rate)

Low End 

Scenario

High End 

Scenario

Low End 

Scenario

High End 

Scenario

Low End 

Scenario 

High End 

Scenario 

fabricators that are not laminators, and in the High End Scenario there are 66,000 firms that are not laminators. As a result, the costs 

to fabricators that are not laminators are higher under the “Low End Scenario” then under the “High End Scenario”. 

3 Costs to laminators represent the costs to all firms that affix a wood or woody grass veneer to a purchased particleboard, MDF or 

veneer core platform. This includes both laminators that are considered panel producers under the proposed rule and laminators that 

are considered fabricators under the proposed rule.

260 

261 Table ES-8 summarizes the cost of the proposed rule by entity type, baseline status under CARB, 

262 and activity.

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

May 1, 2013 ES-23 

Table ES-8: Cost Estimates for Proposed Rule by Type of Entity, Baseline Status, and Activity, Incremental to the CARB ATCM

Type of 

Entity

Baseline Status under CARB 

ATCM

Number of Mills, 

Firms, or 

Production 

Volume (msf†

)

Activities with Incremental Costs 

Estimated

Number of Mills, Firms, 

or Production Volume 

Incurring Costs

Total Cost (million 2010$)

First Year Subsequent 

Years

Panel manufacturers 

All panel manufacturers 62 mills

Become familiar with TSCA rule 62 $0.02 - - -On-site daily quality control testing 21 $0.2 $0.02Set-up to label products as TSCA compliant 62 $0.009 - - -Keep additional records 62 $0.2 $0.2

Manufacture products not certified under CARB ATCM 

16 mills Have products tested and certified by a TPC 16 $0.4 $0.09

49,600 msf Changes to raw materials 47,300 msf $1.1 $1.1

Wood veneer laminated product manufacturers

All laminators 7,486 to 13,875 firms

Become familiar with the TSCA rule 7,486 to 13,875 $2.2 to $4.1 - - -Set-up to label products as TSCA compliant 7,486 to 13,875 $34.1 to $63.2 - - -

Laminators defined as hardwood plywood producers under TSCA

150 to 277 firms

Have products tested and certified by a TPC 150 to 277 $9.3 to $19.6 $8.4 to $17.2On-site daily quality control testing 150 to 277 $1.6 to $3.0 $0.1 to $0.2Keep additional records 150 to 277 $1.4 to $2.5 $1.4 to $2.5

7,248 msf Changes to raw materials 2,149 msf $0.06 $0.06

Laminators defined as fabricators under TSCA

7,336 to 13,598 firms 

and 355,164 msf Changes to raw materials 105,317 msf $3.2 $3.2

Laminators defined as fabricators; not compliant with CARB ATCM requirements for fabricators 

7,336 to 13,598 firms Keep additional records 674 to 1249 $3.7 to $6.8 $3.7 to $6.8

Fabricators that are not laminators

All fabricators that are not laminators 66,103 to 72,492 firms

Become familiar with the TSCA rule 66,103 to 72,492 $19.5 to $21.3 - - -Set-up to label products as TSCA compliant 66,103 to 72,492 $16.8 to $45.9 - - -

Fabricators not compliant with CARB ATCM requirements 33,665 to 40,054 firms Keep additional records 3,703 to 4,406 $20.3 to $24.1 $20.3 to $24.1

Wholesalers 

All wholesalers 85,560 firms

Become familiar with the TSCA rule 85,560 $31.9 - - -If repackaging or replacing an original label, set-up to label products as TSCA compliant 855 $3.9 - - -

Wholesalers that import and are not compliant with CARB ATCM 15,045 firms

Set up systems to keep additional records 8,576 $21.5 - - -Keep additional records 6,649 $13.5 $13.5

Retailers All retailers 759,048 firms Become familiar with the TSCA rule 759,048 $214.7 - - -Total $434 to $447 $56 to $65† Production volume is reported in thousands of square feet (msf) of production
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 ES-24 

263 Benefits 

264 

265 Evidence for health effects associated with formaldehyde exposure is provided by a wide variety 

266 of human clinical, epidemiology, and animal studies. In 2010, EPA released a draft IRIS assessment of 

267 adverse cancer and non-cancer health effects from inhalation of formaldehyde. The draft IRIS assessment 

268 identified seven categories of potential non-cancer health outcomes: (1) sensory irritation; (2) upper 

269 respiratory tract pathology; (3) pulmonary function effects; (4) asthma and allergic sensitization (atopy); 

270 (5) immune function effects; (6) neurological and behavioral toxicity; and (7) developmental and 

271 reproductive toxicity. This analysis focuses on four potential effects: nasopharyngeal cancer, eye 

272 irritation, respiratory related effects, and reduced female fertility. 

273 

274 Nasopharyngeal Cancer. Formaldehyde is classified as a known human carcinogen by the National 

275 Toxicology Program, based on evidence in humans and animals. This analysis uses the EPA’s 1991 IRIS 

276 Inhalation Unit Risk factor of 1.3×10-5 cancer cases per μg/m3 of formaldehyde. 

277 

278 Eye Irritation. Formaldehyde-induced eye, nose, and throat irritation has been well documented in a wide 

279 range of epidemiologic and other human studies. Common effects of chemically induced sensory 

280 irritation include lacrimation, burning of the eyes and nose, rhinitis, burning of the throat, and cough. Eye 

281 irritation is the most sensitive of reported effects in human studies. 

282 

283 Respiratory Related Effects. Formaldehyde exposure is associated with a range of respiratory related 

284 effects. Effects from repeated exposure in humans include irritation of the upper respiratory tract, 

285 decrements in pulmonary function, and nasal epithelial lesions such as metaplasia and loss of cilia. 

286 Animal studies suggest that formaldehyde may also cause airway inflammation. 

287 

288 Reduced Fertility. Epidemiologic studies suggest an association between occupational exposure to 

289 formaldehyde and adverse reproductive outcomes in women, including reduced fertility. 

290 

291 At this time, sensory irritation is the only three of the non-cancer health effect categories were

292 judged to have sufficient data for quantitative concentration-response modeling in support of the benefits 

293 assessment: sensory irritation, asthma, and female reproductive toxicity.. Therefore, this analysis 

294 predicts the number of cases avoided and monetizes the benefits for fourtwo health effects: (1)

295 nasopharyngeal cancer for individuals of all ages, (2)and eye irritation for individuals of all ages, (3) 

296 asthma in children ages 2 to 17 and 6 to 17, and (4) female reproductive toxicity (i.e. reduced fertility) in 

297 women ages 20 to 40. Table ES-6. Table ES-9 presents the estimated annual number of cases of each of 

298 these health effect avoided due to the different analytical options. 

299 

300 There is not sufficient information at this time on the relationship between formaldehye exposure 

301 and reduced fertility to include a valuation estimate in the overall benefits analysis. The analysis also 

302 includes a qualitative discussion of respiratory related effects related to formaldehyde exposure. 

303 Although uncertainty remains regarding how best to quantify the effect of formaldehyde exposure on 

304 fertility and respiratory outcomes, reducing these effects is an important non-monetized impact that 

305 contributes to the overall benefits of the rule. 

306 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 ES-25 

Table ES-9-6:: Annual Number of Cases Avoided in a Typical Year by Analytical Option and Health Effect 

Analytical Option 

Cancer Eye Irritation Asthma Reduced Fertility

Lower Estimate Higher Estimate Lower Estimate Higher Estimate Lower 

Estimate

Higher

Estimate

Option SE 9 21 22,133 170,214 2,469 3,416

Option SI 10 24 23,650 191,590 2,799 3,864

Option SN 11 25 24,154 198,950 2,915 4,019

Option SC 10 24 23,650 191,590 2,799 3,864

Option SCR 10 24 23,650

Option SEUR 9 21 22,133

Option SFCC 9 21 22,133

Option SCR

SCUR (Proposed) 10 24 23,650 191,590 

2,799 3,864

Option CE 7 16 18,015 130,720 1,899 2,627

Option CI 8 19 19,563 148,389 2,166 2,988

Option NE 39 92 58,492 626,726 9,554 13,235

Option NI 40 97 58,494 645,678 9,968 13,800

Option SCRSCUR is the proposed option. Benefits were not estimated for Option SP. 

307 

308 The benefit of avoiding a fatal case of cancer was estimated using a value of $8.01 per micro-risk 

309 reduction (i.e., a reduction of 1 in 1 million of the risk of mortality). The value of avoiding a non-fatal 

310 case of cancer was estimated using a cost of illness approach. The estimates vary depending on the stage 

311 of the cancer when it is first diagnosed, the individual’s age at the time of diagnosis, and the individual’s 

312 employment status (since the value of time lost to illness depends on this status), resulting in a value of a 

313 micro-risk reduction that ranges from $0.09 to $0.14. Based on willingness to pay estimates, the analysis 

314 uses $26 as the value of an avoided case of eye irritation, $35,443 to $66,064 for an avoided case of 

315 asthma incidence. The analysis uses $1,969 to $5,336 per case of reduced fertility avoided based on the 

316 cost of fertility treatments for patients who ultimately become pregnant. 

317 

318 Reductions of formaldehyde emissions from composite wood products benefits individuals who 

319 reside, work, or otherwise spend a substantial amount of time where new composite wood products are 

320 introduced to an indoor space. Benefits are calculated using an age-dependent exposure analysis that 

321 includes formaldehyde exposure from homes, daycare, schools, workplace, vehicles, and outdoors. For 

322 each option, there are 3,300 different exposure scenarios derived from 22 different composite wood 

323 product age/source combinations, 5 structure types (detached housing, attached housing, apartments, 

324 manufactured housing, and recreational vehicles, campers, and trailers), 5 climate zones, and 6 individual 

325 age/employment status combinations. Changes in exposure are estimated by changing the two broad 

326 categories where a substantial amount of new composite wood products might be introduced: new home 

327 construction and major renovations that include kitchen remodeling. 

328 

329 Table ES-10Table ES-7 and Table ES-11Table ES-8 present the total quantified benefits by 

330 health effect and analytical option using 3 and 7 percent discount rates, respectively. The results indicate 

331 that the most protective option with emissions standards that are consistent with the TSCA Title VI 

332 statute (Option SN (, which would require laminated products to be made usingwith both NAF resins and 

333 NAF platforms in order to be exemptexempted from the definition of hardwood plywood, and is the most 

334 protective option with emissions standards that are consistent with TSCA Title VI) has quantified benefits 

335 that are less than 20 percent larger than the quantified benefits of the least protective option with 

336 emissions standards that are consistent with the TSCA Title VI statute (Option SE, which exempts all 

337 laminated products from the definition of hardwood plywood). The quantified benefits under the 

338 proposed option (Option SCUR, which would require laminated products to be made with NAF resins in 

339 order to be exempted from the definition of hardwood plywood) are only slightly lower those of Option 

340 SN, the difference being less than 5 percent. Analytical options that would require all composite wood 

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May 1, 2013 ES-26 

341 products to be made with NAF resin technologies (Options NE and NI) would result in quantified benefits 

342 nearly four times larger than under the analytical options with emissions standards consistent with the 

343 TSCA Title VI statute and analytical options that would require less stringent emissions standards 

344 (Options CE and CI) compared to the statute would result in quantified benefits about 25 percent lower. 

345 Most of the total monetized benefits are attributable to reductions in cancer risk

346 

347 The benefits under the proposed option (Option SCR, which would exempt laminated products 

348 from the definition of hardwood plywood if they are made by using NAF resins to attach veneers to 

349 compliant platforms) are only slightly lower those of Option SN, the difference being less than 5 percent. 

350 Benefits from options SI and SC are equivalent to those from Option SCR because it is assumed that most 

351 laminators would switch to NAF resins under all of these options.

352 

353 Analytical options that would require NAF resins (Options NE and NI) would result in benefits 

354 between three and four times larger than under the analytical options with emissions standards consistent 

355 with TSCA Title VI. Analytical options with emissions standards consistent with TSCA Title VI would 

356 result in benefits that are about 15 to 50 percent higher than options that would require less stringent 

357 emissions standards (Options CE and CI).

358 

359 About 85 percent of the total benefits of the proposed rule are attributable to reductions in asthma 

360 risk and about 14 percent are attributable to reductions in cancer risk. Approximately 2 percent of the 

361 total benefits are attributable to avoiding eye irritation and reduced fertility. 

362 

363 The cancer-related benefits are generally higher for composite wood products that have been 

364 more recently installed, new housing compared to renovated housing, warmer and more humid climate 

365 zones, younger individuals, and individuals who work in the composite wood products industry. 

366 

367 The non-cancereye irritation benefits are generally higher for populations exposed to composite 

368 wood products that have been more recently installed, new housing compared to renovated housing, 

369 warmer and more humid climate zones, younger individuals, and individuals who work in the composite 

370 wood products industry. For eye irritation and asthmaAlso, the avoided risks for eye irritation for the 

371 small number of individuals living in recreational vehicles or camper/trailers and individuals working in 

372 the composite work products industry were notably higher compared to other exposure groups. 

373 

374 There are additional unquantified benefits due to respiratory and other avoided health effects . 

375 The health benefits from avoided cases respiratory related and other health are potentially important non376 monetized impacts that contribute to the overall benefits of this rule, so they are represented in Table ES377 10 and Table ES-11 using the letter “B”.

378 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 ES-27 

Table ES-10-7:: Total Annualized Benefits for All Options (millions 2010$, 3 percent discount rate)

Analytical 

Option 

Cancer Eye Irritation 

Asthma Red

uced 

Ferti

lity

Total Benefits 

Lower 

Estimate 

Higher Estimate Lower Estimate Higher Estimate Lower Estimate Higher Estimate Lower 

Estima

te

Option SE $17.28 $37.6638 $0.535 $4.071 $143.03 18 

+B

$201.84 42 

+B

$1.45 $162.29 

Option SI $19.6520 $43.04 $0.576 $4.596 $162.45 20 

+B $228.6548+B $1.64 $184.31 

Option SN $20.48 $44.9345 $0.586 $4.768 $169.21+B $237.9950+B $1.71 $191.97 

Option SC $19.6520 $43.04 $0.576 $4.596 $162.4520+B $228.6548+B $1.64 $184.31 

Option SCR $20 $43 $0.6 $4.6 $20+B 

Option SEUR $17 $38 $0.5 $4.1 $18+B 

Option SFCC $17 $38 $0.5 $4.1 $18+B 

Option 

SCRSCUR

(Proposed) 

$19.6520 $43.04 $0.576 $4.596 $162.4520+B $228.6548+B 

$1.64 $184.31 

Option CE $13.21 $28.7329 $0.434 $3.121 $109.8714+B $154.9732+B $1.10 $124.62 

Option CI $15.10 $33.02 $0.475 $3.555 $125.5316+B $176.6037+B $1.25 $142.36 

Option NE $75.00 $163.07 $1.354 $14.929 $556.0876+B $785.79178+

B 

$6.37 $638.80 

Option NI $78.5479 $171.02 $1.354 $15.374 $580.3380+B $819.48186+

B 

$6.66 $666.89 

Option SCRSCUR is the proposed option. Benefits were not estimated for Option SP. “B” represents the unquantified health benefits.

379 

380 

Table ES-11-8:: Total Annualized Benefits for All Options (millions 2010$, 7 percent discount rate)

Analytical 

Option 

Cancer Eye Irritation 

Asthma Reduc

ed 

Fertili

ty

Total Benefits 

Lower 

Estimate 

Higher Estimate Lower Estimate Higher Estimate Lower Estimate Higher Estimate Lowe

r 

Estim

ate

Option SE $7.728 $16.6417 $0.505 $3.818 $70.83 8 +B $99.17 20 +B $1.31 $80.35 

Option SI $8.809 $19.12 $0.535 $4.293 $80.599+B $112.5523+B $1.48 $91.41 

Option SN $9 $20 $0.5 $4.5 $10+B 

Option SNSC $9.18 $19.99 $0.555 $4.463 $83.999+B $117.2023+B $1.54 $95.26 

Option 

SCSCR $8.809 $19.12 $0.535 $4.293 $80.599+B $112.5523+B $1.48 $91.41 

Option SEUR $8 $17 $0.5 $3.8 $8+B 

Option SFCC $8 $17 $0.5 $3.8 $8+B 

Option 

SCRSCUR

(Proposed) 

$8.809 $19.12 $0.535 $4.293 $80.599+B $112.5523+B 

$1.48 $91.41 

Option CE $5.896 $12.6913 $0.404 $2.929 $54.326+B $76.0116+B $0.99 $61.61 

Option CI $6.767 $14.6715 $0.444 $3.323 $62.197+B $86.8118+B $1.13 $70.53 

Option NE $33.6334 $72.16 $1.222 $13.879 $276.7335+B $388.0886+B $5.77 $317.36 

Option NI $35.24 $75.7876 $1.222 $14.303 $288.8636+B $404.8090+B $6.04 $331.37 

Option SCRSCUR is the proposed option. Benefits were not estimated for Option SP. “B” represents the unquantified health benefits.

381 

382 

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

May 1, 2013 ES-28 

383 Net Benefits 

384 

385 Table ES-12Table ES-9 and Table ES-13Table ES-10 present the total annualized net benefits by 

386 analytical option and discount rate. The estimatedquantified net benefits under the analytical options that 

387 have emissions standards that are consistent with TSCA Title VI range from negative $10918 million to 

388 positive $206negative $273 million using a three percent discount rate. and negative $48 million to 

389 negative $546 million using a seven percent discount rate. Of these analytical options, Option SI is the 

390 only option where netdifference between quantified benefits are negative under the lower estimate of 

391 netand costs is smallest under Option SEUR. The next smallest difference between quantified benefits 

392 using the three percent discount rate. Option SCR (the and costs is under the proposed option) is the only 

393 option (Option SCUR). Of the analytical options that hashave emissions standards that are consistent 

394 with TSCA Title VI where both the lower and the higher estimate for net, the largest difference between 

395 quantified benefits and costs is positive using the 7 percent discount rate. under Option SI (which 

396 includes laminated products in the definition of hardwood plywood). 

397 

398 There are smaller net benefits (smaller positive and larger negative quantified net benefits) under 

399 Options CE and CI (the analytical options with emissions standards lower than those that are consistent 

400 with TSCA Title VI). Net benefits are lower under these options because the estimated benefits are 

401 substantially lower while the estimated costs are only modestly lower (because the costs are largely 

402 driven by the certification, testing, and chain of custody requirements, which are not affected by the 

403 emissions standards). 

404 

405 ) compared to the proposed option (Option SCUR). The difference between quantified benefits 

406 and costs is largest under Options NE and NI (which have emissions limits that are more stringent than 

407 those required by the statute) have substantially higher costs and benefits than the options with emissions 

408 standards that are consistent with TSCA Title VI. Net benefits are positive under these options using a 3 

409 percent discount rate, and are positive for the higher estimate of net benefits using a 7 percent discount 

410 rate but are negative for the lower estimate using a 7 percent discount rate.). 

411 

412 There are additional unquantified benefits for all of the options from respiratory and other 

413 avoided health effects. While the benefits from these avoided health effects have not been quantified, the 

414 effects could be substantial and so are represented in Table ES-12 and Table ES-13 using the letter “B”.

415 

416 The proposed rule (Option SCUR) has quantified net benefits of -$24 million to -$60 million per 

417 year using a 3 percent discount rate, and -$57 million to -$79 million per year using a 7 percent discount 

418 rate. Costs for the proposed rule exceed quantified benefits by a larger margin than for Option SEUR, 

419 which exempts all laminated products from the definition of hardwood plywood. However, both the 

420 relative ranking of the options and the fact that quantified net benefits are negative for all the options 

421 might change if additional health benefits could be quantified. 

422 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 ES-29 

423 

424 

Table ES-12-9:: Total Annualized Costs, Benefits, and Net Benefits for All Options (millions 

2010$, 3 percent discount rate) 

Analytical Option Costs Benefits Net Benefits

Low End 

Estimate 

High End 

Estimate 

Lower 

Estimate 

Higher 

Estimate 

Lower 

Estimate 

Higher 

Estimate 

Option SE $100 $100 $16218 +B $24542+ B $62($82) +B $145 ($58) +B

Option SI $194204 $293 $184 20 + B $27848+ B ($109)273) 

+B $84 ($157) +B

Option SP $104 $104 Not estimated Not estimated Not estimated Not estimated 

Option SN $143128 $185137 $19221+ B $28950+ B $7($116) +B $146($79) +B

Option SC $112 $121 $18420+ B $27848+ B $63($101) +B $166($64) +B

Option SCR $72 $81 $20+ B $48+ B ($61) +B ($24) +B

Option SEUR $60 $60 $18+ B $42+ B ($42) +B ($18) +B

Option SFCC $100 $100 $18+ B $42+ B ($82) +B ($58) +B

Option SCRSCUR

(proposed) $72 $81 $18420+ B $27848+ B $103($60) +B $206($24) +B

Option CE $99 $99 $12514+B $18832+ B $25($86) +B $89($67) +B

Option CI $192203 $292 $14216+ B $21437+ B ($150)277) 

+B $22($167) +B

Option NE $379 $379 $63976+ B $970178+ B $259($303) 

+B $591($201) +B

Option NI $473484 $573 $66780+ B $1,013186+ B $94($493) +B $540($297) +B

 Option SCRSCUR is the proposed option. Parentheses indicate negative net benefits. 

Lower estimate of net benefits is calculated by subtracting high end cost estimate from lower benefits estimate. 

Higher estimate of net benefits is calculated by subtracting low end cost estimate from higher benefits estimate.

“B” represents the unquantified health benefits.

425 

426 

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

May 1, 2013 ES-30 

Table ES-13-10:: Total Annualized Costs, Benefits, and Net Benefits for All Options (millions 

2010$, 7 percent discount rate) 

Analytical Option 

Costs Benefits Net Benefits 

Lower 

Estimate 

Higher 

Estimate 

Lower 

Estimate 

Higher 

Estimate 

Lower 

Estimate

Higher 

 Estimate 

Option SE $112 $112 $80 8+ B $121 20+ B ($31)103) +B $9 ($91) +B

Option SI $208218 $311 $91 9+ B $137 23+ B ($220)302) 

+B ($71)195) +B

Option SP $115 $115 Not estimated Not estimated Not estimated Not estimated 

Option SN $154139 $195148 $95 10+ B $143 24+ B ($99)138) +B ($11)114) +B

Option SC $123 $132 $91 9+ B $137 23+ B ($41)123) +B $14 ($100) +B

Option SCR $80 $89 $9+ B $23+ B ($80) +B ($57) +B

Option SEUR $68 $68 $8+ B $20 + B ($60) +B ($48) +B

Option SFCC $111 $111 $8+B $20+ B ($103) +B ($91) +B

Option SCRSCUR

(proposed) $8180 $89 $91 9+ B $137 23+ B $2 ($79) +B $($57) +B

Option CE $111 $111 $62 6+ B $93 16+ B ($49)104) +B ($18)95) +B

Option CI $207217 $310 $71 7+ B $106 18+ B ($239)303) 

+B ($101)199) +B

Option NE $383 $383 $317 35+ B $480 86+ B ($66)348) +B $97 ($297) +B

Option NI $480490 $582 $331 36+ B $501 90+ B ($251)546) 

+B $21 ($400) +B

Option SCRSCUR is the proposed option. Parentheses indicate negative net benefits. 

Lower estimate of net benefits is calculated by subtracting high end cost estimate from lower benefits estimate. 

Higher estimate of net benefits is calculated by subtracting low end cost estimate from higher benefits estimate.

 “B” represents the unquantified health benefits.

427 

428 Small Business Impacts 

429 

430 Table ES-14Table ES-11 presents a summary of the small business impacts of the proposed 

431 option (Option SCRSCUR). There are 878,798 small firms affected by the rule. As indicated, 

432 851,296298 small firms (about 97 percent) are expected to have costs impacts that are less than one 

433 percent of their revenues, 23,133131 firms (about 3 percent) are expected to experience impacts at levels 

434 between one and three percent of their revenue, and 4,369 firms (less than 1 percent) are expected to incur 

435 costs exceeding three percent of their revenues. 

436 

437 Note that many of the firms with cost impacts above 1 percent of their revenues are fabricators, 

438 wholesalers, and retailers with annualized costs of less than $250. This implies that their revenues were 

439 below $25,000. These firms account for 92 percent of the firms with cost impacts that are between 1 and 

440 3 percent and 42 percent of the firms with cost impacts that exceed 3 percent. 

441 .

442 

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

May 1, 2013 ES-31 

Table ES-14-11:: Summary of Small Business Impacts

Firm Type Number of Affected 

Small Firms 

Number of Firms by Cost-Impact 

Ratio

<1% 1-3% >3% 

Stock Panel Producer 31 2527 53 1 

Wood Veneer Laminated Product 7,486 5,532 795 1,159 

Fabricator 72,357 66,360 4,017 1,977 

Wholesale 84,936 80,730 2,975 1,231 

Retail 713,989 698,648 15,341 - 

All Firms 878,798 851,296298 23,133131 4,369 

443 

444 Environmental Justice Impacts 

445 

446 Table ES-15Table ES-12 presents a summary of the environmental justice impacts of the 

447 proposed option (Option SCRSCUR). Minority and low-income groups account for a larger proportion of 

448 the total benefits than their share of the affected population. Minorities represent about 35 percent of the 

449 population affected by the rule and are estimated to accrue about 4639 percent of the total quantified 

450 benefits. Low-income individuals compose 12 percent of the total affected population, and are estimated 

451 to accrue 1814 percent of the total quantified benefits. 

452 

Table ES-15-12:: Summary of Environmental Justice Impacts

Population Type Share of Total 

Population 

Share of Total 

AnnualizedQuant

ified Benefits 

Race and Ethnicity 

Non-Hispanic White 65% 5461% 

Non-Hispanic Black 12% 1513% 

Non-Hispanic Other 7% 8% 

Hispanic 15% 2218% 

Non-Hispanic Native American or Alaskan Indian 0.6% 0.76% 

All Individuals 100% 100% 

Income 

Individuals Living Below Poverty Line 12% 1814% 

Individuals Living Above Poverty Line 87% 8185% 

All Individuals 100% 100% 

The number of individuals above and below the poverty line does not sum to the total number of 

individuals because poverty status could not be determined for some individuals.

453 

454 Children’s Health Impacts

455 

456 As shown in Table ES-16Table ES-13,, children aged twozero through fifteenone represent 193

457 percent of the individuals affected by the rule and are estimated to accrue about 752 to 10 percent of the 

458 proposed rule’s total quantified benefits for avoided cases of nasopharyngeal cancer and eye irritation. 

459 Children aged two through fifteen represent 20 percent of the individuals affected by the rule and are 

460 estimated to accrue 16 to 22 percent of the proposed rule’s total quantified benefits. These results are 

461 driven by the benefits associated with avoiding asthma incidencecancer risk. 

462 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 ES-32 

Table ES-16-13: : Summary of Quantified Benefits for Children (annualized at 3% rate)

Population Affected 

Population 

Affected 

Annually 

(thousands)

Population 

Affected as 

Percent of 

Total Affected 

Population 

Total 

Quantified 

Benefits 

Lower Estimate

(millions 2010$)

Total Quantified 

Benefits 

Higher Estimate

(millions 2010$)

Total Quantified 

Benefits 

Lower Estimate

(% of total 

affected 

population)

Total Quantified 

Benefits 

Higher Estimate 

(% of total 

affected 

population)

All Individuals 106,057 100.00% $184.3120.22 $277.9247.63 100.00% 100.00% 

Children ages 0-1 4,9713,309 4.693.12% $0.47 $4.79 0.262.35% 1.7210.06% 

Children ages 2-15 19,65121,3

12

18.5320.10

% $136.953.16 $209.9910.57 74.3115.63% 75.5622.19% 

463 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 1-1

464 1 Problem Definition and the Justification for Regulation 

465 

466 The purpose of this chapter is to present an overview of the economic justifications for federal 

467 regulations to address the problem of formaldehyde emissions from composite wood products. Section 

468 1.1 characterizes the formaldehyde emissions problem and discusses various sources of exposure. In 

469 Section 1.2, the regulatory background associated with formaldehyde emissions from composite wood 

470 products is presented. Section 1.3 discusses how market failure due to externalities and incomplete 

471 information result in inefficient levels of formaldehyde emissions from composite wood products. 

472 Section 1.4 compares the proposed approach for addressing these market failures with alternative 

473 regulatory approaches. 

474 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 1-2

475 1.1 Problem with Formaldehyde Emissions from Composite Wood Products 

476 

477 Formaldehyde is a colorless, flammable gas at room temperature that has a strong odor. It is 

478 found in resins used in the manufacture of composite wood products (i.e., hardwood plywood, 

479 particleboard and medium-density fiberboard). It is also found in household products such as glues, 

480 permanent press fabrics, carpets, antiseptics, medicines, cosmetics, dishwashing liquids, fabric softeners, 

481 shoe care agents, lacquers, plastics and paper product coatings. It is a by-product of combustion and 

482 certain other natural processes. Examples of sources of formaldehyde gas inside homes include cigarette 

483 smoke, unvented, fuel-burning appliances (gas stoves, kerosene space heaters), and composite wood 

484 products made using formaldehyde-based resins (ATSDR 2010). 

485 

486 Formaldehyde is both an irritant and a known human carcinogen (HHS 2011). Depending on 

487 concentration, formaldehyde can cause eye, nose, and throat irritation, even when exposure is of relatively 

488 short duration. In the indoor environment, sensory reactions and various symptoms as a result of mucous 

489 membrane irritation are some potential effects from exposure. There is also evidence that formaldehyde 

490 may be associated with changes in pulmonary function and increased risk of asthma in children (ATSDR 

491 ). In addition, formaldehyde is a by-product of human metabolism; therefore, endogenous levels are 

492 present in the body. 

493 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 1-3

494 1.2 Regulatory Background 

495 

496 In 2007, the California Air Resources Board (CARB) issued an Air Toxics Control Measure 

497 (ATCM) to reduce formaldehyde emissions from hardwood plywood, medium-density fiberboard, and 

498 particleboard products referred to collectively as composite wood products. The CARB ATCM was 

499 approved on April 18, 2008 by the California Office of Administrative Law. The first emission standards 

500 took effect on January 1, 2009. The CARB ATCM requires manufacturers to meet formaldehyde 

501 emission standards for the covered composite wood products that are sold, offered for sale, supplied, or 

502 manufactured for use in California. The CARB ATCM also requires that compliant composite wood 

503 products be used in finished goods sold, offered for sale, supplied or manufactured for sale in California. 

504 The CARB ATCM does not apply to hardwood plywood and particleboard materials when installed in 

505 manufactured homes subject to regulations promulgated by the United States Department of Housing and 

506 Urban Development (HUD). 

507 

508 The CARB ATCM Phase 1 emission standards for hardwood plywood veneer core, particleboard, 

509 and medium-density fiberboard took effect on January 1, 2009. The Phase 1 standard for hardwood 

510 plywood composite core took effect on July 1, 2009. The more stringent Phase 2 standards first took 

511 effect on January 1, 2010 for hardwood plywood veneer core. Phase 2 standards for medium-density 

512 fiberboard and particleboard went into effect on January 1, 2011. The final Phase 2 standards to take 

513 effect under the CARB ATCM are for thin medium density fiberboard on January 1, 2012 and for 

514 hardwood plywood composite core, which begins July 1, 2012. 

515 

516 The CARB ATCM requires manufacturers of the regulated composite wood products to 

517 demonstrate compliance with the emission standards by having their emissions tests and quality control 

518 processes certified by a third party certifier (TPC). TPCs must be approved by CARB and must follow 

519 specified requirements to verify that a manufacturer’s production meets applicable formaldehyde 

520 emission standards and that the manufacturers follow prescribed quality control practices. Once approved 

521 by CARB, manufacturers who use no-added formaldehyde (NAF) resin systems are exempted from 

522 ongoing testing requirements after three months of testing in cooperation with a TPC. Manufacturers who 

523 use ultra low-emitting formaldehyde (ULEF) resin systems may be approved by CARB to reduce the 

524 frequency of ongoing testing or, if they meet more stringent emissions requirements, they may be 

525 exempted from ongoing testing requirements for two years. The exemption based on ULEF resin is 

526 granted after approval by CARB and six months of testing in cooperation with a TPC. Manufacturers 

527 who receive exemptions based on NAF or ULEF resin can reapply every two years for the exemption 

528 from TPC oversight and formaldehyde emissions testing by submitting the chemical formulation of the 

529 resin and the results of at least one primary or secondary method test for each product type (based on a 

530 panel or set of panels randomly selected and tested by a TPC). 

531 

532 Under the CARB ATCM, manufacturers of composite wood products are required to label their 

533 covered products to identify them as meeting either the Phase 1 or Phase 2 emission standards, or as being 

534 made with either NAF or ULEF resins. Manufacturers must also include a statement of compliance on 

535 the bill of lading or invoice for the composite wood product. The CARB ATCM also imposes 

536 recordkeeping requirements on manufacturers to document their compliance with the regulations. Records 

537 must be kept for two years. 

538 

539 The CARB ATCM requires distributors, importers, fabricators, and retailers to purchase and 

540 sell panels and finished goods that comply with the applicable formaldehyde emission standards. They 

541 must take “reasonable precautions,” such as communicating with their suppliers, to ensure that the 

542 products they purchase are in compliance with the applicable emission standards. Like manufacturers, 

543 distributors and importers must also provide a statement of compliance on the composite wood or finished 

544 good product bill of lading or invoice. They must also maintain records documenting compliance for a 
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545 period of two years. Importers and fabricators must label their finished goods as compliant with the 

546 applicable standards. The labeling requirement also applies to distributors if the product is in some way 

547 modified. One example of a modification that would make a distributor subject to the labeling 

548 requirement is if the distributor receives composite wood product panels, cuts them into different shapes 

549 or sizes, and applies edge banding to them. 

550 

551 On March 24, 2008, 25 organizations and approximately 5,000 individuals petitioned EPA 

552 under section 21 of the toxic substances control act (TSCA) to use its authority under section 6 of TSCA 

553 to adopt the CARB ATCM nationally. The petitioners asked EPA to assess and reduce the risks posed by 

554 formaldehyde emitted from hardwood plywood, particleboard, and medium-density fiberboard by 

555 exercising its authority under TSCA section 6 to adopt and apply nationwide the CARB formaldehyde 

556 emissions regulation for these composite wood products. In addition, petitioners requested that EPA 

557 extend this regulation to include composite wood products used in manufactured homes. 

558 

559 On June 27, 2008, EPA issued a Federal Register notice in response to the TSCA section 21 

560 petition (Ref. 11). The notice announced the Agency’s intent to grant in part and deny in part the 

561 petitioners’ request. EPA denied the petitioners’ request to immediately pursue a TSCA section 6 

562 rulemaking, stating that the available information at the time was insufficient to support an evaluation of 

563 whether formaldehyde emitted from hardwood plywood, particleboard, and medium-density fiberboard 

564 presents or will present an unreasonable risk to human health (including cancer and non-cancer endpoints) 

565 under TSCA section 6. As discussed in detail in the Federal Register notice announcing EPA’s response 

566 to the petition, EPA’s evaluation of the data provided by the petitioners revealed significant information 

567 gaps that would have needed to be filled to support an evaluation of whether use of formaldehyde in these 

568 products presents or will present an unreasonable risk under TSCA section 6. However, EPA did agree to 

569 initiate a proceeding to investigate whether and what type of regulatory or other action might be 

570 appropriate to protect against risks posed by formaldehyde emitted from pressed wood products. 

571 

572 Accordingly, on December 3, 2008, EPA issued an Advance Notice of Proposed Rulemaking 

573 (ANPR) that announced EPA’s intention to investigate whether and what regulatory or other action might 

574 be appropriate to protect against risks posed by formaldehyde emitted from the products covered by the 

575 CARB ATCM as well as other pressed wood products. To help inform EPA’s decision on the best ways 

576 to address risks posed by formaldehyde emissions from pressed wood products, the Agency requested 

577 public comments and held six half-day public meetings in Research Triangle Park, NC ; Portland, OR; 

578 Chicago, IL; Dallas, TX; Washington, DC; and New Orleans, LA. EPA received and reviewed 

579 comments submitted during the ANPR comment period, which can be found at regulations.gov under 

580 docket number EPA-HQ-OPPT-2008-0627. 

581 

582 On July 7, 2010, President Obama signed into law the Formaldehyde Standards for Composite 

583 Wood Products Act, or Title VI of TSCA, 15 U.S.C. 2697. The statute establishes formaldehyde 

584 emission standards that are identical to the CARB ATCM Phase 2 standards for hardwood plywood, 

585 medium-density fiberboard, and particleboard sold, supplied, offered for sale, or manufactured in the 

586 United States and directs EPA to issue final implementing regulations by January 1, 2013. (Pursuant to 

587 TSCA section 3(7), the term “manufacture” means import, produce, or manufacture.) TSCA Title VI 

588 does not give EPA the authority to raise or lower the established emission standards and EPA must 

589 promulgate the implementing regulations in a manner that ensures compliance with the standards. 

590 Congress directed EPA to consider a number of elements for inclusion in the implementing regulations, 

591 many of which are aspects of the CARB program. These elements include: labeling, chain of custody 

592 requirements, sell-through provisions, ultra low-emitting formaldehyde resins, no-added formaldehyde593 based resins, finished goods, third-party testing and certification, auditing and reporting of TPCs, 

594 recordkeeping, enforcement, laminated products, and exceptions from the requirements of regulations 

595 promulgated for products and components containing de minimis amounts of composite wood products. 
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596 1.3 Justification for Regulation 

597 

598 Market failure can justify government regulation; the major types of market failures include the 

599 following: 

600 

601  Negative externalities, common property resources, and public goods 

602  Market power 

603  Inadequate or asymmetric information 

604 

605 The occurrence of any of these conditions justifies further inquiry into the need for government 

606 regulation to reduce inefficiencies in the allocation of society’s resources. This section describes why 

607 negative externalities and inadequate information are present in the market for composite wood products. 

608 Understanding the nature of the inefficiencies involved facilitates the design of more effective 

609 regulations. The specific regulatory approach considered here involves an emissions standard verified 

610 through third party testing and certification as well as chain of custody requirements. 

611 

612 Economic efficiency suggests that in the absence of regulation the market for lower emitting 

613 composite wood products would exist so long as the composite wood product purchasers’ willingness-to614 pay for low emission products equals or exceeds the incrementally higher cost of lower emitting products. 

615 If the composite wood product purchasers are aware of the risks associated with formaldehyde emissions 

616 and of the availability and costs of lower emitting products, then arguably they might be able to 

617 accurately trade off risk and cost without the aid of government regulation. However, there are two 

618 arguments for why composite wood product consumers may not trade off risk and cost efficiently: (1) 

619 because externalities exist, and (2) because of inadequate and asymmetric information. 

620 

621 1.3.1 Externalities Associated with Formaldehyde Emissions from Composite Wood 

622 Products 

623 

624 One cause of market failure in the market for low emissions composite wood products stems from 

625 externalities. An efficient outcome is achieved when the marginal willingness-to-pay for a service is 

626 equivalent to the marginal cost of providing that service. In the case of a composite wood product 

627 purchase, the primary beneficiaries of lower emission composite wood products are the individuals who 

628 live or work where the composite wood products will be installed. However, the decision about whether 

629 or not to pay for lower emitting composite wood products may be made by builders, employers, property 

630 owners, or managers who have an insufficient incentive to take the benefits to the occupants into account 

631 when making this decision. Externalities may also exist in cases where the purchase is made by the 

632 occupant of the residence where composite wood products will be installed. While the current occupant 

633 may not be willing to pay more for lower emitting composite wood products, future occupants, visitors, 

634 and children receiving child care on the premises may potentially be harmed by formaldehyde emissions 

635 from composite wood products. 

636 

637 Thus, formaldehyde emissions from composite wood products may constitute an externality. As 

638 such, perfect information would not result in the efficient allocation of lower emitting composite wood 

639 products because it does not correct the problem resulting from that fact that there are individuals who do 

640 not have influence on the purchasing decision, but do face the risks associated with formaldehyde 

641 emissions that result from it. For example, a future occupant of a housing unit for sale may experience an 

642 increased exposure to formaldehyde if a renovation occurs where high emitting composite wood products 

643 are installed before they move in. While a future occupant might be willing to pay to reduce or eliminate 

644 this exposure, they would not be consulted by the current occupant making the decision. As another 
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645 example, children cannot express their willingness-to-pay for risk reduction and rely on their parents’ or 

646 the property owners’ willingness-to-pay. 

647 

648 1.3.2 Inadequate Information 

649 

650 A second cause of market failure associated with the formaldehyde emissions from composite 

651 wood products is due to inadequate information about the emissions levels of composite wood products 

652 and the risks associated with formaldehyde emissions from composite wood products. Full information is 

653 an important prerequisite to the lower emitting composite wood products because the consumer must 

654 know the risks associated with composite wood products with higher formaldehyde emissions in order to 

655 make an informed decision about whether lower emitting composite wood products are worth the extra 

656 cost. Inadequate information can lead to inefficient outcomes. Without knowing the differences in the 

657 relative risks between lower and higher formaldehyde emitting composite wood products, the consumer 

658 will not be able to weigh these differences in risk with the differences in price. 

659 

660 1.3.3 Justification for Regulation at the Federal Level 

661 

662 Many composite wood products are distributed in commerce across state lines. It is more 

663 efficient for companies manufacturing, fabricating, distributing, and retailing composite wood products to 

664 comply with a single standard rather than a patchwork of different state regulations. Under TSCA Title 

665 VI, Congress directed EPA to promulgate regulations to implement national formaldehyde emission 

666 standards. While the TSCA Title VI does not prevent states from developing their own regulations, states 

667 are less likely to promulgate regulations if there is a federal regulation in place. 

668 
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669 1.4 Alternative Regulatory Approaches for Reducing Exposure to 

670 Formaldehyde Emissions from Composite Wood Products 

671 

672 This section examines alternative approaches for addressing the market failures discussed in the 

673 previous section. The proposed rule utilizes a performance standard approach, which is required by 

674 statute. The statute requires that all producers must meet a specific emissions standard but does not 

675 prescribe a specific technology for achieving the emissions standard. The advantage of a performance 

676 standard over a technology standard is that firms have more incentive to develop lower cost technologies 

677 for achieving the standard. 

678 

679 The primary alternative to a performance standard is a market based regulatory approach that 

680 includes a mechanism to force market participants to incorporate the social cost of the formaldehyde 

681 emissions from composite wood products into their private costs. This approach is not allowable under 

682 the statute, and would not be desirable or practical in the case of formaldehyde from composite wood 

683 products. Emissions reductions under a performance standard (such as the proposed rule) generally 

684 achieve a more uniform reduction in emissions across sources compared to the emissions reductions 

685 under a market based approach where higher emissions from some sources can be offset by lower 

686 emissions from other sources. Thus, market based approaches are generally only effective if “hot spots” 

687 are not a concern (Stavins 2001) – i.e., the negative pollution impacts are not localized near the releases. 

688 But “hot spots” are an issue for composite wood products because the products are used inside of homes, 

689 offices, schools, and other buildings. Exposures in individual buildings can be very different from the 

690 average exposures due to the cumulative regional or national emissions from composite wood products. 

691 

692 Another possible alternative regulatory approach is an information provision approach. In the 

693 case of formaldehyde emissions from composite wood products, this type of approach could be a labeling 

694 requirement for composite wood products. Since the purchaser of the composite wood products may not 

695 be the person who will ultimately be exposed to the formaldehyde emissions from the products (i.e., an 

696 externality exists), information provision does not force market participants to incorporate the social cost 

697 of the formaldehyde emissions from composite wood products into their private costs, and therefore is 

698 unlikely to correct the market failure. Furthermore, an effective information provision requirement would 

699 need to include testing, certification, and chain of custody requirements in order for products to be 

700 credibly labeled as lower emission products. Thus, the regulatory cost of a labeling requirement is likely 

701 to be similar to the cost of the proposed rule given that most of the costs of the regulation are attributable 

702 to these activities (see Chapter 2). 
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703 2 Costs 

704 

705 This chapter discusses the potential costs to businesses of complying with the proposed 

706 regulatory requirements under TSCA Title VI, and various other analytical options. The methods for 

707 estimating the number of affected entities and the resulting estimates are presented in section 2.1. The 

708 per-mill testing and certification costs for stock hardwood plywood panel producers (including engineered 

709 wood flooring producers), medium density fiberboard (MDF) producers, and particleboard producers are 

710 presented in section 2.2. Section 2.3 describes the total costs to these producers for changes to raw 

711 materials, production processes, and third party testing and certification. Section 2.4 presents the total 

712 costs to wood veneer laminated product producers for changes to raw materials, production processes, and 

713 third party testing and certification. Section 2.5 presents the costs associated with rule familiarization, 

714 recordkeeping, labeling, supplier notification, and rule familiarization. Finally, section 2.6 presents the 

715 total costs of the regulation. 

716 

717 The general approach of this analysis is to: (1) estimate the number of affected entities and the 

718 quantity of affected production; (2) estimate the direct compliance costs on a per entity or per unit of 

719 production basis; and (3) combine the per entity and per production costs with the number of affected 

720 entities and the quantity of affected production, respectively, to calculate the total direct compliance costs. 

721 

722 The potential costs of the proposed TSCA Title VI Implementation Rule are estimated for several 

723 analytical options which are presented in Table 2-1. 

724 

725 This document discusses various options with respect to formaldehyde and composite wood 

726 products. In some instances, the statute chose an option and this document discusses an alternative 

727 simply for informational purposes. The breadth of the discussion here should not imply that EPA 

728 necessarily has corresponding flexibility in implementing the statute. 

729 

730 
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Table 2-1: Analytical Options Considered in Cost Analysis

Analytical Option a Notes a

Analytical options with emissions standards at the levels required by TSCA Title VI b

Option SE: Statutory emissions standards where wood 

veneer laminated products are exempt from the 

definition of hardwood plywood

Laminators do not need TPC testing or certification. No 

ULEF certification. 

Option SI: Statutory emissions standards where wood 

veneer laminated products are included in the definition 

of hardwood plywood

All laminators must have products tested and certified by a 

TPC. No ULEF certification. 

Option SP: Statutory emissions standards where wood 

veneer laminated products other than Custom and 

Architectural Panel products are exempt from the 

definition of hardwood plywood

Only laminators making Custom or Architectural panels 

must have products tested and certified by a TPC. 

Laminators making other products do not need TPC testing 

or certification. No ULEF certification. 

Option SN: Statutory emissions standards where wood 

veneer laminated products made using NAF resins to 

attach wood veneers to NAF platforms are exempt from 

the definition of hardwood plywood

Laminators using NAF resins to attach wood veneers to 

NAF platforms do not need TPC testing and certification. 

Laminators making other products do not need TPC testing 

or certification. No ULEF certification. 

Option SC: Statutory emissions standards where wood 

veneer laminated products made with wood veneers 

attached to compliant platforms using no-added 

formaldehyde (NAF) resins are exempt from the 

definition of hardwood plywood

Laminators using NAF resins to attach wood veneers to 

compliant platforms do not need TPC testing and 

certification. Laminators making other products do not need 

TPC testing or certification. No ULEF certification. 

Option SCR: Statutory emissions standards where 

wood veneer laminated products made with wood 

veneers attached to compliant platforms using NAF 

resins are exempt from the definition of hardwood 

plywood. Reduced recordkeeping requirements for nonmanufacturers compared to other options.

Laminators using NAF resins to attach wood veneers to 

compliant platforms do not need TPC testing and 

certification. Laminators making other products do not need 

TPC testing or certification. No ULEF certification. 

Wholesalers and retailers that are not manufacturers under 

TSCA would only be required to keep invoices and bills of 

lading. No supplier notification required.

Option SEUR: Statutory emissions standards where 

wood veneer laminated products are exempt from the 

definition of hardwood plywood. ULEF certification 

allowed.c Reduced recordkeeping requirements for nonmanufacturers.

Laminators do not need TPC testing or certification. ULEF 

certification allowed. Wholesalers and retailers that are not 

manufacturers under TSCA would only be required to keep 

invoices and bills of lading. No supplier notification 

required.

Option SFCC: Statutory emissions standards with 

regulatory provisions that are fully consistent with 

CARB ATCM.

Tested lots may be shipped before test results are available. 

Laminators do not need TPC testing or certification. ULEF 

certification allowed. Panel producers and fabricators must 

label products. 

Option SCUR: Proposed Option. 

Statutory emissions standards where wood veneer 

laminated products made with wood veneers attached to 

compliant platforms using NAF resins are exempt from 

the definition of hardwood plywood. ULEF certification 

allowed. c Reduced recordkeeping requirements for nonmanufacturers.

Laminators using NAF resins to attach wood veneers to 

compliant platforms do not need TPC testing and 

certification. Other laminators must have products tested 

and certified by a TPC. ULEF certification allowed. 

Wholesalers and retailers that are not manufacturers under 

TSCA would only be required to keep invoices and bills of 

lading. No supplier notification required.

Analytical options with 

emissions standards other 

than the levels required by 

TSCA Title VI 

CARB 

Phase 1 

levels d

Option CE: CARB 1 emissions standards where wood 

veneer laminated products are exempt from the 

definition of hardwood plywood

Laminators do not need TPC testing or certification. 

Option CI: CARB 1 emissions standards where wood 

veneer laminated products are included in the definition 

of hardwood plywood

Laminators must have products tested and certified by a 

TPC. 

NAF 

emission 

levels e

Option NE: NAF emissions standards where wood 

veneer laminated products are exempt from the 

definition of hardwood plywood

Laminators do not need TPC testing or certification. 

Option NI: NAF emissions standards where all wood 

veneer laminated products are included in the definition 

of hardwood plywood

Laminators must have products tested and certified by a 

TPC. 

Note: This document discusses various options with respect to formaldehyde and composite wood products, including emissions standards that 

are different from those set in TSCA Title VI. This document discusses alternative emissions standards simply for informational purposes. 

The breadth of the discussion here should not necessarily imply that EPA has corresponding flexibility in implementing the statute.
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Table 2-1: Analytical Options Considered in Cost Analysis a

 Panel producers must have products tested and certified by a TPC under all options. Recordkeeping and supplier notification requirements 

are equivalent to the CARB ATCM unless noted otherwise. 

b

 Emission levels for TSCA Title VI standard certification (and CARB Phase 2): Hardwood plywood = 0.05 ppm; MDF = 0.11 ppm; Thin 

MDF = 0.13 ppm; Particleboard = 0.09 ppm.

c Emission levels for ULEF certification with reduced quality control testing: Hardwood plywood: 90% of samples < 0.05 ppm and all 

samples < 0.05 ppm; MDF: 90% of samples < 0.06 ppm and all samples < 0.09 ppm; thin MDF: 90% of samples < 0.08 ppm and all samples 

< 0.11 ppm; Particleboard: 90% of samples < 0.05 ppm and all samples < 0.08 ppm. Emission levels for ULEF certification with quarterly 

TPC test exemption: Hardwood plywood: 90% of samples < 0.04 ppm and all samples < 0.05 ppm; MDF: 90% of samples < 0.04 ppm and 

all samples < 0.06 ppm; thin MDF: 90% of samples < 0.04 ppm and all samples < 0.06 ppm; Particleboard: 90% of samples < 0.04 ppm and 

all samples < 0.06 ppm. 

d

 Emission levels for CARB Phase 1: Hardwood plywood = 0.08 ppm; MDF = 0.21 ppm; Thin MDF = 0.21 ppm; Particleboard = 0.18 ppm. e

 Emission levels for NAF certification: Hardwood plywood: 90% of samples < 0.04 ppm and all samples < 0.05 ppm; MDF and 

particleboard: 90% of samples < 0.04 ppm and all samples < 0.06 ppm. 

731 

732 Table 2-2 presents a summary of the different requirements under each analytical option. A 

733 summary of the activities associated with the incremental costs that firms are estimated to incur under the 

734 proposed option is presented in Table 2-3. 

735 

Table 2-2: Regulatory Requirements of the Analytical Options Considered in the Economic Analysis

Regulatory Requirements Analytical Options Considered in the Economic Analysis

SE SI SP SN SC SCR SEUR SFCC SCUR CE CI NE NI

Emission standards at levels required by 

TSCA Title VI

        

Emissions standards at CARB Phase 1 

levels

 

Emission standards at NAF levels  

No wood veneer laminated products are 

defined as hardwood plywood

    

All wood veneer laminated products are 

defined as hardwood plywood

  

Certain wood veneer laminated products 

are defined as hardwood plywood

    

Recordkeeping and supplier notification 

consistent with CARB ATCM

         

Reduced recordkeeping for nonmanufacturers. No supplier notification.

  

ULEF certification allowed   

ULEF certification not allowed          

Tested lots must be held until results are 

available. Wholesalers that repackage 

must label products.

           

Tested lots may be shipped before results

are available. Only panel producers and 

fabricators must label products.



Option SCUR is the proposed option.

736 
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Table 2-3: Activities with Incremental Costs Estimated Under Option SCUR (the proposed option) by Sector 

and Type

Activity

Panel Manufacturers

Fabricators

Wholesalers

Retailers

Laminators Other Fabricators

CARB 

compliant

Not CARB 

compliant

Use Added 

Formaldeh

yde Resins

Use 

NAF 

resins

CARB 

compliant

Not CARB 

compliant Importers

Not 

Importers

Become Familiar 

with TSCA rule Yes Yes Yes Yes Yes Yes Yes Yes Yes

Make Changes to 

Raw Materials Yes a Yes b

On-Site Daily 

Quality Control 

testing

Yes c Yes c Yes c

Have Products 

Tested and Certified 

by a TPC

Yes Yes d

Set Up Systems to 

Keep Additional 

Records 

Yes Yes e

Keep Additional 

Records Yes Yes Yes Yes f Yes f Yes e

Set Up to Label 

Products as TSCA 

Compliant

Yes Yes Yes Yes Yes Yes Yes g Yes g

a

 Some uncertified panel manufacturers will need to change their raw materials in order to meet the emissions standards.

b

 Most laminated product producers currently using add-formaldehyde resins will switch to NAF resins in order to avoid being defined as panel manufacturers. 

Some of the remaining laminated product producers that continue using added-formaldehyde resins will need to change their raw materials in order to meet the 

emissions standards. c The proposed rule includes a requirement that tested lots must be held until test results indicate that the emission standard has been met. The analysis assumes 

that some hardwood plywood producers required to perform quality control testing (including laminators using added-formaldehyde resins) will respond by 

conducting daily on-site quality control testing so that they can ship panels the same day that they are produced, instead of holding tested lots in inventory while 

waiting for the quality control testing to be performed by an off-site lab. Panel producers with an existing ULEF or NAF certification will already be exempted 

from quality control testing, and particleboard and MDF manufacturers are assumed to be conducting daily on-site quality control testing to comply with the 

CARB ATCM. d Laminators that use added-formaldehyde resin will need to have their products tested and certified by a TPC.

e

 Wholesalers that import composite wood products are defined as manufacturers under TSCA and are subject to the same recordkeeping requirements as 

manufacturers. Some of those importers that are not compliant with the CARB ATCM will incur costs to set up recordkeeping systems and ongoing costs to 

keep these additional records. f Some fabricators that are not compliant with the CARB ATCM will incur ongoing costs to keep additional records.

g. Wholesalers that repackage goods or replace an original label will incur set up costs to label the goods as TSCA compliant.

737 

738 In order to estimate costs that are comparable to the estimated benefits, this analysis estimates the 

739 costs of each analytical option over a 30 year period. This time frame was selected to be as short as 

740 possible while being long enough to capture the important benefit effects of the policy. In general, the 

741 downside of choosing a longer analysis time frame is that uncertainties about both the baseline and policy 

742 scenarios increase with time. For example, the likelihood that alternative technologies for manufacturing 

743 composite wood products might be developed increases over time (which could result in lower 

744 formaldehyde emission rates for products and/or lower costs for reducing formaldehyde emissions). 

745 Similarly, uncertainties about changing demographics, treatments for adverse health effects, and 

746 consumer preferences with respect to composite wood products all increase with time. However, 

747 selecting a time frame that is too short would not capture all of the important effects of the policy 

748 scenarios under consideration. 

749 

750 The present discounted value for the annualized value of the thirty year stream of costs is 

751 estimated using discount rates of 3 and 7 percent. Costs are discounted (for the discount rate r = 3% and r 

752 = 7%) back to the beginning of the 30-year period, as follows: 
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753 

ሻ௧݁ݑܸ݈ܽ ݁݀ݐ݊ݑ݋ܿݏܷ݊݀݅ሺ ෍ൌ ݁ݑܸ݈ܽ ݁݀ݐ݊ݑ݋ܿݏ݅ܦ ݐ݁݊ݏ݁ݎܲ 

ሺ1 ൅ rሻ௧

ଷ଴

௧ୀ଴

(1) 

754 

755 

756 
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Table 2-1: Analytical Options Considered in Cost Analysis

Analytical Option Emissions Standards Notes

Analytical options with emissions standards at the levels required by TSCA Title VI

Option SE: Statutory emissions 

standards where wood veneer 

laminated products are exempt from 

the definition of hardwood plywood

Hardwood plywood 

MDF 

Thin MDF

Particleboard

0.05 ppm

0.11 ppm

0.13 ppm

0.09 ppm

Same emissions standards as Phase 2 of the 

CARB ATCM. Recordkeeping and supplier 

notification equivalent to CARB ATCM.

Option SI: Statutory emissions 

standards where wood veneer 

laminated products are included in 

the definition of hardwood plywood

Same as above

Same emissions standards as Phase 2 of the 

CARB ATCM, with a different definition of 

hardwood plywood. Recordkeeping and supplier 

notification equivalent to CARB ATCM.

Option SP: Statutory emissions 

standards where wood veneer 

laminated products other than 

Custom and Architectural Panel 

products are exempt from the 

definition of hardwood plywood

Same as above

Same emissions standards as Phase 2 of the 

CARB ATCM, with a different definition of 

hardwood plywood. Recordkeeping and supplier 

notification equivalent to CARB ATCM.

Option SN: Statutory emissions 

standards where wood veneer 

laminated products made using NAF 

resins to attach wood veneers to NAF 

platforms are exempt from the 

definition of hardwood plywood

Same as above

Same emissions standards as Phase 2 of the 

CARB ATCM, with a different definition of 

hardwood plywood. Recordkeeping and supplier 

notification equivalent to CARB ATCM.

Option SC: Statutory emissions 

standards where wood veneer 

laminated products made with wood 

veneers attached to compliant 

platforms using no-added 

formaldehyde (NAF) resins are 

exempt from the definition of 

hardwood plywood

Same as above

Same emissions standards as Phase 2 of the 

CARB ATCM, with a different definition of 

hardwood plywood. Recordkeeping and supplier 

notification equivalent to CARB ATCM.

Option SCR: Proposed Option. 

Statutory emissions standards where 

wood veneer laminated products 

made with wood veneers attached to 

compliant platforms using NAF

resins are exempt from the definition 

of hardwood plywood. Reduced 

recordkeeping requirements for nonmfgrs. compared to other options. 

Same as above

Same emissions standards as Phase 2 of the 

CARB ATCM, with a different definition of 

hardwood plywood

Distributors and retailers that are not 

manufacturers under TSCA would only be 

required to keep invoices and bills of lading. 

Other recordkeeping equivalent to CARB ATCM. 

No supplier notification.

Analytical options with emissions standards 

other than the levels required by TSCA Title 

VI CARB Phase 1 

levels

Option CE: CARB 1 emissions 

standards where wood veneer 

laminated products are exempt from 

the definition of hardwood plywood

Hardwood plywood 

MDF 

Thin MDF

Particleboard

0.08 ppm

0.21 ppm

0.21 ppm

0.18 ppm

Same emissions standards as Phase 1 of the 

CARB ATCM. Recordkeeping and supplier 

notification equivalent to CARB ATCM.

Option CI: CARB 1 emissions 

standards where wood veneer 

laminated products are included in 

the definition of hardwood plywood

Same as above

Same emissions standards as Phase 1 of the 

CARB ATCM, with a different definition of 

hardwood plywood. Recordkeeping and supplier 

notification equivalent to CARB ATCM.

NAF emission levels

Option NE: NAF emissions 

standards where wood veneer 

laminated products are exempt from 

the definition of hardwood plywood

Hardwood plywood: 

90% of samples < 0.04 ppm. 

All samples < 0.05 ppm.

MDF and particleboard: 

90% of samples < 0.04 ppm. 

All samples < 0.06 ppm

Requires all composite wood product 

manufacturers to meet NAF emission standards. 

Recordkeeping and supplier notification 

equivalent to CARB ATCM.

Option NI: NAF emissions 

standards where all wood veneer 

laminated products are included in 

the definition of hardwood plywood

Same as above

Requires all composite wood product 

manufacturers to meet NAF emission standards, 

with a different definition of hardwood plywood. 

CARB recordkeeping and supplier notification.

Note: This document discusses various options with respect to formaldehyde and composite wood products, including emissions standards 

that are different from those set in TSCA Title VI. This document discusses alternative emissions standards simply for informational 

purposes. The breadth of the discussion here should not necessarily imply that EPA has corresponding flexibility in implementing the statute.

757 
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758 The present discounted value costs are annualized as follows: 

759 

ሺܣ݊݊ݑ݈ܽ݅ݖ݁݀ ݏݐݏ݋ܥሻ ൌ ሺܲܦܸଷ଴ ௬௘௔௥ ௖௢௦௧ ௦௧௥௘௔௠ሻ כ ݎ כ ሺ1 ൅ ݎሻଷ଴

ሺ1 ൅ ݎሻଷଵ െ 1

(2) 

760 
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761 2.1 Estimated Number of Affected Entities 

762 

763 This section summarizes the number of establishments and firms that will be affected by the 

764 proposed TSCA Title VI Implementation Rule. An establishment is a single physical location at which 

765 business is conducted and a firm is business organization or entity consisting of one domestic 

766 establishment or more under common ownership or control. Both the estimated numbers of 

767 establishments and firms are presented here because some of the cost elements estimated for this analysis 

768 are estimated on a per establishment basis and others are estimated on a per firm basis. 

769 

770 The numbers of affected entities are categorized into the following categories based on the types 

771 of requirements they will face under TSCA Title VI: 

772 

773  Panel producers are defined as the entities that produce composite wood panels (hardwood plywood, 

774 MDF and particleboard) as defined by TSCA Title VI and are subject to emissions standards, third 

775 party testing and certification, chain of custody requirements, and labeling requirements (see section 

776 2.1.1); 

777  Wood veneer laminated product producers produce hardwood plywood by gluing a wood or woody 

778 grass veneer to the face and/or back of a purchased platform to produce a component part used in the 

construction or assembly of a finished good.3 779 Wood veneer laminated product producers are 

780 considered composite wood product fabricators rather than hardwood plywood producers under the 

781 CARB ATCM, and they are not required to meet the ATCM’s emissions standards. TSCA Title VI 

782 includes laminated products in the definition of hardwood plywood, and directs EPA to conduct a 

783 rulemaking process to determine whether to exempt any of these products from the definition. If EPA 

784 does not exempt laminated products from the definition of hardwood plywood, then laminated 

785 products will have to meet TSCA Title VI’s emissions standards (in addition to being made with 

786 certified platforms) (see section 2.1.2); and 

787  Fabricators are entities that use composite wood products to produce other goods (see section 2.1.3); 

788  Wholesalers and Retailers are entities that sell composite wood products. Both types of entities are 

789 subject to chain of custody requirements and wholesalers are potentially subject to labeling 

790 requirements (see section 2.1.4). 

791 

792 2.1.1 Estimated Number of Stock Panel Producers 

793 

794 Table 2-4 presents the total number of stock hardwood plywood, MDF, and particleboard 

establishments (mills) and firms subject to TSCA Title VI’s emissions requirements.4 795 The total number 

796 of MDF and particleboard mills and firms include all those identified for the EPA survey of composite 

797 wood product producers (described in section 2.1.1.1) and are consistent with data in other publically 

798 available sources (see CPA 20072011).). The search to identify stock hardwood plywood mills 

799 (including engineered wood flooring) mills resulted in the identification of 41 mills. This analysis 

800 assumes that all U.S. hardboard mills use PF or NAF resins and would qualify to be exempted from the 

801 TSCA Title VI emission standards. 

 3

 The laminated products discussed here do not include products that are solely laminated with materials other than 

veneer, such as high pressure laminate, thermally fused paper, vinyl film, decorative foil, or polypropylene film. 4

 Stock hardwood plywood does not include wood veneer laminated products that qualify as hardwood plywood. In 

addition, some hardwood plywood (such as military specified plywood, curved plywood, exterior plywood, etc.) is 

statutorily exempted in TSCA Title VI, and thus is not subject to the emission requirements. 
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802 

Table 2-4: Stock Hardwood Plywood, MDF, and Particleboard 

Firms and Mills Directly Subject to Emission Requirements 

Sector 

Total Number in Industry 

Firms Mills 

Hardwood Plywood 32 41 

MDF 14 22 

Particleboard 16 30 

Total 62 93 

Note that because mills and firms producing two different types of composite 

wood products are expected to incur separate costs for each product type, the 

estimates of 93 mills and 62 firms used to estimate costs are derived by 

counting mills and firms that produce two different types of composite wood 

products twice. There are 90 unique mills and 54 unique firms that produce 

composite wood panels. 

803 

804 2.1.1.1 Respondent Identification for the EPA Pressed Wood Manufacturing Industry Survey 

805 

806 The universe of composite wood product manufacturing mills was developed from a list EPA 

807 developed for a 1998 industry survey conducted for the Plywood and Composite Wood Product (PCWP) 

808 National Emissions Standards for Hazardous Air Pollutants (NESHAP). Through a 1998 information 

809 collection request (ICR), mills potentially affected by the NESHAP were identified. This included 

810 industries in three categories based on their Standard Industrial Classification (SIC) or North American 

811 Industry Classification System (NAICS) classifications: softwood plywood and veneer, reconstituted 

812 wood products, and structural wood members. The ICR surveyed 416 potentially affected mills (EPA 

813 1998), and an additional 15 mills were identified that either did not respond to the survey or have 

814 commenced operation since the date of the survey (EPA )..

815 

816 EPA updated the 1998 mill list to reflect the current universe of mills based on information from 

817 trade journals, company websites, press releases, trade association websites, and other sources to reflect 

818 mill closures, mill openings, mergers and acquisitions, and similar changes that have occurred over the 

819 past decade. A total of 343 U.S. composite wood product manufacturing mills were identified for an 

820 initial survey mailing list – a universe of mills that included hardboard and structural composite wood 

821 product producers not regulated under TSCA Title VI. 

822 

823 In addition to the initial list of composite wood product producers, several approaches were 

824 employed to identify additional composite wood product mills that may have been excluded originally. 

825 These approaches are described below. 

826 

827 A variety of composite wood product lists were identified and searched, and a review was 

828 conducted of the company websites of mills listed in EPA’s Envirofacts aggregated mills database under 

829 the relevant NAICS codes (see Table 2-5). A multisystem facility search was performed in the 

830 Envirofacts database, which queries multiple environmental databases for facility information, for four 

831 NAICS codes, and results were cross-checked against the original OAQPS list. The four NAICS codes 

832 searched were: 

833 

834 o 321211: Hardwood Veneer and Plywood Mfg.;

835 o 321212: Softwood Veneer and Plywood Mfg.;

836 o 321213: Engineered Wood Member (exc. truss) Mfg.; and

837 o 321219: Reconstituted Wood Product Mfg.

838 
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May 1, 2013 2-10

839 The additional facility search resulted in 192 potential new mills operated by companies not on 

840 the initial list, of which 52 were confirmed to be potentially in-scope. Scope was determined in two 

841 phases. First, company websites of these mills were viewed to determine whether the companies 

842 appeared to be within the scope of ourthe survey. After notification letters were sent to all potentially in843 scope respondents, respondent identification calls were placed to this group of mills to further confirm 

844 scope. Because many companies and mills lacked complete or up-to-date websites, not all mills could be 

845 categorized as definitively in or out of scope. Following respondent identification calls, these additional 

846 mills were sent survey packages in two batches later than the original survey distribution. Table 2-5 gives 

847 the full list of sources checked in order to identify additional mills. 

848 

Table 2-5: Composite Wood Product Producer Lists for Mill Identification

Facility Directories

2009 Big Book. Random Lengths Publications

Oregon Forest Industry Directory

California Air Resources Board List of Certified Mills: Composite Wood Products Airborne Toxic 

Control Measure (as of June 14, 2010)

PanelWorld 2009 Annual Directory & Buyers’ Guide

2009 Big Book. Random Lengths Publications

Wood Product Manufacturing Associations 

The Engineered Wood Association (APA) 

The Composite Panel Association (CPA) – website membership directory 

The American Institute of Timber Construction (AITC) 

The American Hardboard Association (AHA) 

The Wood I-Joist Manufacturers Association (WIJMA) 

The Western Wood Products Association (WWPA) 

The Engineered Wood Products Association (EWPA) 

Harwood Panel and Veneer Association (HPVA) personal communication with EPA 

North American Laminate Flooring Association (NALFA) 

National Wood Flooring Association (NWFA) 

Other Sources

EPA Envirofacts Facility Data

849 

850 2.1.2 Number of Wood Veneer Laminated Product Producers 

851 

852 Wood veneer laminated product producers are considered composite wood product fabricators 

853 rather than hardwood plywood producers under the CARB ATCM, and they are not required to meet the 

854 ATCM’s emissions standards. TSCA Title VI includes laminated products in the definition of hardwood 

855 plywood, and directs EPA to conduct a rulemaking process to determine whether to exempt any of these 

856 products from the definition. If EPA does not exempt laminated products from the definition of 

857 hardwood plywood, then laminated products will have to meet TSCA Title VI’s emissions standards (in 

858 addition to being made with certified platforms). 

859 

860 The number of wood veneer laminated product producers is based on discussions with industry 

861 associations and a series of interviews with hardwood veneer manufacturers and wholesalers. The 

862 information gathered from discussions with industry associations indicated that there are relatively few 

863 wood veneer laminated product producers, with the exception of business and household furniture 

864 manufacturing. To gather more information EPA conducted interviews with veneer manufacturers and 

865 wholesalers in order to learn more about their customers that are wood veneer laminated product 

866 producers. 

867 
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868 The firms that were interviewed were selected from a Hardwood Veneer and Plywood 

Association (HPVA) list5 869 and the companies listed as “Face Veneer Suppliers” at www.veneernet.com. 

870 Based on information gathered from company and third party websites, firms on this list were categorized 

871 into four types: (1) specialized in hardwood veneer manufacture, (2) specialized in hardwood veneer and 

872 plywood manufacture, (3) specialized in hardwood veneer wholesale, and (4) wholesalers of hardwood 

873 veneer and other wood products. Firms on each of these four lists were sorted in random order and phone 

calls were placed until two entities in each category participated in an interview.6 874 One additional set of 

875 calls was placed until one additional entity on the hardwood veneer wholesale list participated in an 

876 interview. This group was selected for the extra interview because the prior interviews indicated that this 

877 group appeared to have more small customers, a group where little information was available. 

878 

879 There was wide disagreement over the number of businesses in the U.S. that are wood veneer 

880 laminated product producers. Three respondents thought this number was less than 1,000; two estimated 

881 that it was between 1,000 and 10,000; and three estimated it was tens of thousands. One respondent did 

882 not provide an estimate. Of those respondents that put the number in the tens of thousands, one suggested 

883 that it was more than 50,000, and another suggested this number was about 100,000. 

884 

885 Based on the interviews, the number of potential wood veneer laminated product producers is 

886 likely to be between 7,000 and 14,000. The respondents that estimated that there were fewer businesses 

887 may not be aware of these smaller operations because they do not cater to these smaller customers. Part 

888 of the reason that some respondents estimated that there were more wood veneer laminated product 

889 producers may be because these respondents were thinking of businesses that would be exempt from the 

890 rule’s requirements (e.g., veneering something to create a product that would not be considered a 

composite panel7 891 , veneering to substrates (such as metal) that do not qualify as composite wood products, 

892 using veneer to make products that are statutorily exempt from the rule (such as boats, autos, products not 

893 intended for interior use, etc.). Nevertheless, publically available data and other information that EPA has 

894 obtained from industry associations is not consistent with more than about 14,000 businesses making 

895 wood veneer laminated products. 

896 

897 The following NAICS have been identified as the primary consumers of hardwood veneer (i.e., 

898 they consume enough veneer such that the value of raw veneer material is reported in Economic Census 

899 data): 

900 

901  321211 Hardwood veneer and plywood manufacturing 

902  321911 Wood window and door manufacturing 

903  337211 Wood office furniture manufacturing 

904  337110 Wood kitchen cabinet and countertop manufacturing 

905  337121 Upholstered household furniture manufacturing 

906  337122 Nonupholstered wood household furniture manufacturing 

907  337127 Institutional furniture manufacturing 

908  337129 Wood television, radio, and sewing machine cabinet manufacturing 

909  337212 Custom architectural woodwork and millwork manufacturing 

910  337215 Showcase, partition, shelving, and locker manufacturing 

 5

 HPVA Veneer Manufacturer/Sales Members. Available at: http://www.hpva.org/sites/default/files/HPVAVeneer.pdf 

(Accessed April 18, 2011) 

6

 Note that one of the respondents on the veneer manufacturer list identified themselves as a re-manufacturer of veneer 

and was categorized as the second veneer manufacturer for the purpose of selecting the sample. A respondent on the 

veneer and plywood manufacturer list identified themselves as a manufacturer of hardwood veneer and other wood 

products and was categorized as the second veneer and plywood manufacturer for the purpose of selecting the sample. 7

 Where a panel means a flat or raised piece of composite wood product. 
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May 1, 2013 2-12

911 

912 In addition, businesses in the following industries may also do their own veneering (although 

913 many of them – indicated with a “*” – would be statutorily exempt from the TSCA Title VI rule even if 

they do their own veneering8 914 : 

915 

916  321920 Wood container and pallet manufacturing* 

917  336111 Automobile manufacturing* 

918  336411 Aircraft manufacturing* 

919  336611 Ship building and repairing* 

920  336612 Boat building* 

921  321999 All other miscellaneous wood product manufacturing 

922  339920 Sporting and athletic goods manufacturing 

923  339932 Game, toy, and children's vehicle manufacturing 

924  339992 Musical instrument manufacturing 

925  811420 Reupholstery and furniture repair 

926 

927 There are 35,846 employer establishments and 46,704 nonemployer establishments in these 

928 industries. Thus, it is estimated that the total number of establishments, including nonemployers, in these 

929 industries is 82,550. 

930 

931 Assumptions for High End and Low End Estimates of Wood Veneer Laminated Product Producers 

932 

933 Two sets of estimates, a high end estimate and a low end estimate, were made for the number of 

934 entities that make wood veneer laminated products and thus are potentially subject to the TSCA Title VI 

935 rule as hardwood plywood producers. Table 2-6 presents the underlying data, assumptions and resulting 

936 estimates for the high end estimate of the number of wood veneer laminated product producers. These 

937 assumptions are described in more detail below. 

938 

939 Windows and Doors. There are about 1,500 employer establishments and 2,200 nonemployer 

940 establishments in this industry (NAICS 321911). Because no information was available about how many 

941 companies making wood windows or doors affix veneer to platforms themselves (as opposed to buying 

942 veneered components from suppliers), the analysis assumes all producers affix veneer. This assumption 

may overestimate the number of entities potentially subject to the rule as panel producers.9 943 

944 

945 Furniture. There are about 6,300 employer establishments in the furniture industry (NAICS 

946 337211, 337121, 337122, and 337127) and about 5,000 nonemployer establishments. Note that the 

947 Census does not report the number of nonemployer establishments at the 6-digit NAICS level, so the 

948 number of establishments reported here is estimated by applying the proportions of the 6-digit NAICS as 

949 a share of the broader NAICS for employer establishments to the number of nonemployers in the broader 

950 NAICS. 

951 

952 The furniture industry is the only sector where trade associations reported that it is common for 

953 companies to affix veneer to their products. The Business and Institutional Furniture Manufacturing 

 8

 Section 601(a)(3)(i) of TSCA limits the term “hardwood plywood” to panels that are intended for interior use. Section 

601(c)(9) exempts packaging products. And Section 601(c)(10) exempts certain vehicles (other than recreational 

vehicles), rail cars, boats, aerospace craft, and aircraft. 

9

 Note that depending on the process for laminating the hardwood veneer, window manufacturers in particular may not be 

producing what the rule defines as a “panel,” in which case they would only be subject to the requirements for 

fabricators. However, windows containing less than 5% by volume of composite wood product and exterior doors 

containing less than 3% by volume of composite wood product are statutorily exempt from the rule’s requirements. 
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May 1, 2013 2-13

954 Association (BIFMA) indicated that “many if not most” business and institutional furniture producers 

955 would make products that were made with wood veneer and about 75 percent of those would affix the 

956 veneer themselves (Personal Communication with BIFMA 2010(BIFMA 2010).). The American Home 

957 Furnishing Alliance (AHFA) indicated that most domestic furniture producers would affix wood veneer 

958 themselves, but estimated that there were about 250 firms that do this (Personal Communication with 

959 AHFA 2010(AHFA 2010).). To develop a high end estimate for the number of wood furniture producers 

960 that affix veneer and thus make wood veneer laminated products, the analysis assumed that 50 percent of 

961 establishments in these industries manufacture products that contain veneer and 75 percent of those 

962 establishments do the laminating themselves. 

963 

964 Kitchen Cabinets. There are about 9,700 employer establishments and 7,800 nonemployer 

965 establishments in this industry (NAICS 337110). It is worth noting that NAICS 337110, and thus these 

966 establishment counts, includes both cabinet manufacturers (who may laminate hardwood veneer) and 

967 countertop manufacturers (who do not use hardwood veneer). The Cabinet Makers Association, which 

968 generally represents smaller custom cabinet manufacturers, said “very, very few” would do their own 

969 veneering (CMA 2010). The Kitchen Cabinet Manufacturers Association (KCMA), which generally 

970 represents larger stock cabinet manufacturers, said 5 percent or less of cabinet manufacturers would do 

971 their own veneering (KCMA 2010). The Architectural Woodwork Institute (AWI) did not think any of its 

members would do their own veneering.10 972 Thus, the analysis assumes that 5 percent of these 

973 establishments affix veneers and thus make wood veneer laminated products. 

974 

975 Other Products. Because the other manufacturing sectors that may include establishments that 

976 laminate their own hardwood veneers consist of a very diverse group of manufacturers, including 

977 establishments that do not even use composite wood products let alone laminate their own hardwood 

978 veneer, the analysis assumes that 5 percent of these establishments laminate their own hardwood veneers. 

979 

980 High End Estimate. The assumptions about the percentages of establishments in different 

981 industries that are laminating their own hardwood veneer results in a high end estimate that as many as 

982 14,000 establishments might laminate hardwood veneer, as shown in Table 2-6. However, this estimate 

983 conflicts with information provided in the interviews with nine companies that sell hardwood veneer, 

984 described earlier. That information indicated that no more than 30 percent of businesses laminating their 

985 own hardwood veneer are nonemployer operations. However, the estimate of 14,000 businesses that do 

986 their own veneering is based on about 7,000 nonemployer operations (50% of the total). Therefore, the 

987 high end estimate of 14,000 establishments may overestimate the number of wood veneer laminated 

988 product manufacturers. 

989 

990 Low End Estimate. To derive a low end estimate for the number of domestic entities that 

991 laminate hardwood veneer, the analysis extrapolated to the total number of wood veneer laminated 

992 product establishments from the employer establishments by assuming that 30 percent of the total are 

993 nonemployer establishments, based with information provided in the interviews with nine companies that 

994 sell hardwood veneer, described earlier. In addition, it was assumed that 1 percent of manufacturers in 

995 the miscellaneous manufacturing sectors laminate their own veneer as compared to the 5 percent that was 

996 assumed for the upper bound estimate. Other assumptions were the same as for the upper bound estimate. 

997 Table 2-7 presents the underlying data, assumptions and resulting estimates for the lower bound estimate 

998 of domestic entities that laminate hardwood veneer. 

999 

1000 

 10 Note that participants in the veneer sales interviews did think this was common for architectural woodwork and 

millwork manufacturers, but there are only about 4,000 entities in this sector. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-14Table 2-6: High End Estimate for Entities that Laminate Hardwood Veneer 

Employer NAICS Nonemployer NAICS

Establishments in 

Affected NAICS Entities Doing Own Veneering Description of Assumptions 

Employers Non- employers Employers Non- employers All Entities 

321211: Hardwood veneer and plywood manufacturing 

321: Wood product manufacturing 

303 456 68 - 68 50 Custom panel producers and 18 engineered wood flooring producers. 

321911: Wood window and door manufacturing 1,493 2,246 1,493 2,246 3,739 Assume all wood window and door producers do their own veneering. 321920: Wood container and pallet manufacturing 2,918 4,390 - - - Assume statutorily exempt. 321999: All other miscellaneous wood product manufacturing 1,971 2,965 739 1,112 1,851 

Assume 50 percent use veneer and 75 percent of those laminate the veneer themselves. 

337110: Wood kitchen cabinet and countertop manufacturing 

337: Furniture and related product manufacturing 

9,701 7,769 485 388 873 Assume 5 percent do their own veneering. 

337211: Wood office furniture manufacturing 457 366 171 137 308 

Assume 50 percent use veneer and 75 percent of those laminate the veneer themselves. 

337121: Upholstered household furniture manufacturing 1,641 1,314 615 493 1,108 337122 Nonupholstered wood household furniture manufacturing 3,414 2,734 1,280 1,025 2,305 337127: Institutional furniture manufacturing 776 621 291 233 524 337129: Wood television, radio, and sewing machine cabinet manufacturing 265 212 99 80 179 337212: Custom architectural woodwork and millwork manufacturing 2,235 1,790 838 671 1,509 337215: Showcase, partition, shelving, and locker manufacturing 1,375 1,101 516 413 929 336111: Automobile manufacturing 336: 

Transportation equipment manufacturing 

188 98 - - - Assume statutorily exempt. 

336411: Aircraft manufacturing 265 138 - - - Assume statutorily exempt. 336611: Ship building and repairing 674 350 - - - Assume statutorily exempt. 336612: Boat building 1,117 580 - - - Assume statutorily exempt. 339920: Sporting and athletic goods manufacturing 339: 

Miscellaneous manufacturing 

1,881 3,925 94 196 290 Assume 5% do their own veneering. 

339932: Game, toy, and children's vehicle manufacturing 639 1,333 32 67 99 Assume 5% do their own veneering. 339992: Musical instrument manufacturing 600 1,252 30 63 93 Assume 5% do their own veneering. 811420: Reupholstery and furniture repair 4,693 22,549 - - - Assume statutorily exempt. 

Total 36,606 56,189 6,751 7,124 13,875 

1001 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-15Table 2-7: Low End Estimate for Entities that Laminate Hardwood Veneer 

NAICS Nonemployer NAICS

Establishments in 

Affected NAICS Entities Doing Own Veneering Description of Assumptions 

Employers Non- employers Employers Non- employers All Entities 

321211: Hardwood veneer and plywood manufacturing 

321: Wood product manufacturing 

303 456 68 68 50 Custom panel producers and 18 engineered wood flooring producers. 

321911: Wood window and door manufacturing 1,493 2,246 1,493 640 2,133 Assume all wood window and door producers do their own veneering. 321920: Wood container and pallet manufacturing 2,918 4,390 Assume statutorily exempt. 321999: All other miscellaneous wood product manufacturing 1,971 2,965 99 42 141 

Assume 50 percent use veneer and 75 percent of those laminate the veneer themselves. 

337110: Wood kitchen cabinet and countertop manufacturing 

337: Furniture and related product manufacturing 

9,701 7,769 485 208 693 Assume 5 percent do their own veneering. 

337211: Wood office furniture manufacturing 457 366 171 73 244 

Assume 50 percent use veneer and 75 percent of those laminate the veneer themselves. 

337121: Upholstered household furniture manufacturing 1,641 1,314 615 264 879 337122 Nonupholstered wood household furniture manufacturing 3,414 2,734 1280 549 1,829 337127: Institutional furniture manufacturing 776 621 291 125 416 337129: Wood television, radio, and sewing machine cabinet manufacturing 265 212 99 42 141 337212: Custom architectural woodwork and millwork manufacturing 2,235 1,790 112 48 160 337215: Showcase, partition, shelving, and locker manufacturing 1,375 1,101 516 221 737 336111: Automobile manufacturing 336: 

Transportation equipment manufacturing 

188 98 0 - Assume statutorily exempt. 

336411: Aircraft manufacturing 265 138 0 - Assume statutorily exempt. 336611: Ship building and repairing 674 350 0 - Assume statutorily exempt. 336612: Boat building 1,117 580 0 - Assume statutorily exempt. 339920: Sporting and athletic goods manufacturing 339: 

Miscellaneous manufacturing 

1,881 3,925 19 8 27 Assume 1% do their own veneering. 

339932: Game, toy, and children's vehicle manufacturing 639 1,333 6 3 9 Assume 1% do their own veneering. 339992: Musical instrument manufacturing 600 1,252 6 3 9 Assume 1% do their own veneering. 811420: Reupholstery and furniture repair 4,693 22,549 - - - Assume exempt.

Total 36,606 56,189 5,260 2,226 7,486 

1002 
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May 1, 2013 2-16

1003 2.1.3 Estimated Number of Affected Fabricator Establishments 

1004 

1005 Table 2-8 presents the estimated number of affected fabricator establishments and firms in each 

1006 industry. NAICS that reported using composite wood products as raw materials were identified as being 

1007 fabricators (U.S. Census Bureau 2009e). Unlike for wholesale and retail entities (see section 2.1.4), it is 

1008 assumed that all fabricator entities sell goods containing composite wood products. 

1009 

Table 2-8: Number of Affected Fabricator Establishments and Firms, by NAICS

NAICS NAICS Description 

Employer 

Estab. 

NonEmployer 

Estab. 

Total 

Number of 

Estab. 

Number of 

Firms 

321211 / 

321219 Decorative and custom panel producersa -85 85 85 71 

321911 Wood window and door manufacturing 1,493 2,246 3,739 3,582 

321918 Other millwork including flooring manufacturing 2,110 3,175 5,285 5,214 

321991 Manufactured home (mobile home) manufacturing 379 570 949 798 

321992 Prefabricated wood building manufacturing 818 1,231 2,049 1,930 

321999 Other miscellaneous wood product manufacturing 1,971 2,965 4,936 4,822 

336213 Motor home manufacturing 79 41 120 112 

336214 Travel Trailer and Campers manufacturing 862 447 1,309 1,203 

337110 Wood kitchen cabinets and countertop manufacturing 9,701 7,769 17,470 17,360 

337121 Upholstered household furniture manufacturing 1,641 1,314 2,955 2,790 

337122 Nonupholstered wood household furniture manufacturing 3,414 2,734 6,148 6,061 

337124 Metal household furniture manufacturing 329 263 592 579 

337127 Institutional furniture manufacturing 776 621 1,397 1,367 

337129 Wood television, radio, and sewing machine cabinet 

manufacturing 265 212 477 476 

337211 Wood office furniture manufacturing 457 366 823 804 

337212 Custom architectural woodwork and millwork manufacturing 2,235 1,790 4,025 3,991 

337214 Office furniture (non-wood) manufacturing 290 232 522 486 

337215 Showcase, partition, shelving, and locker manufacturing 1,375 1,101 2,476 2,415 

339950 Sign manufacturing 6,406 19,627 26,033 25,917 

Total 34,601686 46,789704 81,390 79,978 

a. Affected establishment and firm counts for decorative and custom panel producers (NAICS 321211 and 321219) were estimated from the list of 

laminators and coaters in the Composite Panel Association's 2011 Surface and Panel Buyers Guide (CPA 20112010). 

Sources: Composite Panel Association 2010, U.S. Census Bureau 2009e, 2010k, l 

1010 

1011 As indicated in Table 2-8, an estimated 79,978 fabricator firms comprising 81,390 establishments 

1012 will be affected by the proposed TSCA Title VI rule. 

1013 

1014 2.1.4 Estimated Number of Affected Wholesale and Retail Establishments 

1015 

1016 This section describes the process used to adjust the number of firms and establishments in 

1017 affected retail and wholesale industries to account for the fact that not all entities in these industries sell 

1018 composite wood products. This is necessary because not all establishments in affected industries are 

1019 expected to sell composite wood products. For example, some retail stores in the Floor Covering Stores 

1020 industry (NAICS 442210) might only sell carpet and rugs, and therefore would not be affected by the 

1021 TSCA Title VI rule’s requirements. 

1022 

1023 2.1.4.1 Description of the Data 

1024 

1025 Data from the 2007 Economic Census’ Product Lines Subject Series were used to estimate the 

1026 number of wholesale and retail establishments that sell composite wood products in affected industries 

Field Code Changed

Field Code Changed
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-17

1027 (U.S. Census Bureau 2010j, 2011). Product line data were not available at the firm level; however, ratios 

1028 of firms to establishments by NAICS are used to estimate the numbers of affected firms. Census 

1029 describes product lines as “major categories of products” (U.S. Census Bureau 2010i) and classifies them 

1030 with products and services codes (product line codes), which “represent various types of products carried 

1031 or services rendered by an establishment” (U.S. Census Bureau 2010m). The Census datasets provide the 

1032 number of establishments selling specified product lines, by product line and NAICS code. For example, 

1033 the retail dataset shows that of the 28,834 establishments classified in the furniture stores industry 

1034 (NAICS 442110), 9,968 sell the product line “office furniture, including computer-related furniture” (U.S. 

1035 Census Bureau 2010j). 

1036 

1037 Different product line codes are used in the retail and wholesale sectors. In addition, they can 

represent broad or detailed product lines.11 1038 Broad product lines offer a more general category of products 

1039 and/or services, and are comprised of detailed product lines. For example, the broad product line 

1040 “flooring and floor coverings” contains the detailed product lines “hardwood flooring” and “other hard 

1041 surface floor coverings and accessories, including tile and sheet goods,” as well as others. These detailed 

1042 product lines provide greater insight for making assumptions and increase the accuracy of the 

1043 establishment estimates. Detailed product line data, however, are not available for all broad product lines 

1044 in the Census datasets. 

1045 

1046 2.1.4.2 Methodology 

1047 

1048 The first step for refining the estimates of retailers and wholesalers that sell composite wood 

1049 products was to develop a list of the product line codes for the establishments in affected industries. 

1050 Based on their descriptions, these unique product line codes were then categorized according to whether 

1051 they are expected to contain composite wood products. Because Census does not always provide data at 

1052 the detailed product line level, a broad product line was categorized as containing composite wood 

1053 products if it contained at least one detailed product line expected to be made with composite wood 

1054 products. This process led to the creation of two separate keys – one for retail and one for wholesale – 

1055 which were then applied to the corresponding Census data (See Appendix A). 

1056 

1057 Table 2-9 provides an example of the product lines sold in an affected industry, as well as 

1058 whether the product line is broad or detailed, and whether it is expected to contain composite wood 

1059 products. 

1060 

 11 In the datasets, broad product lines are indicated by a zero in the final digit. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-18

Table 2-9: Example of Affected Establishment Count using Product Line Analysis: Window 

Treatment Store Industry (NAICS 442291) 

Product 

Line Code Meaning of Product Line code Product Line Level 

IncludesMay 

Include Composite 

Wood Products? 

20000 Industry total Total Yes 

20200 Men's wear, including accessories Broad 

20220 Women's, juniors', and misses' wear, including accessories Broad 

20270 Sewing, knitting materials & supplies, needlework goods, etc Broad 

20280 Curtains, draperies, blinds, slipcovers, bed & table coverings Broad 

20281 Curtains & draperies Detailed 

20282 Vertical & horizontal blinds, woven wood blinds, & shades Detailed 

20283 Furniture coverings, including ready-made & custom-made Detailed 

20284 Domestics, incl towels, sheets, blankets, table linens, etc Detailed 

20330 Audio equip, musical instr, radios, stereos, CDs, records, etc Broad 

20340 Furniture, sleep equipment & outdoor/patio furniture Broad Yes 

20360 Flooring & floor coverings Broad Yes 

20361 Soft-surface (textile) floor coverings & accessories Detailed 

20363 Hardwood flooring Detailed Yes 

20364 Other hard-surface floor coverings & accessories Detailed 

20380 Kitchenware & home furnishings Broad Yes 

20381 Cookware & cooking accessories Detailed 

20382 Dinnerware, china, glassware, tableware, giftware Detailed 

20383 Decorative accessories, incl lamps, lampshades, mirrors, etc Detailed Yes 

20384 All other kitchenware & home furnishings Detailed 

20400 Jewelry, incl watches, watch attach, novelty jewelry, etc Broad 

20420 Books Broad 

20460 Toys, hobby goods, & games Broad Yes 

20600 Hardware, tools, & plumbing & electrical supplies Broad 

20620 Lawn, garden, & farm equipment & supplies Broad 

20640 Dimensional lumber & oth bldg/structural materials & supplies Broad Yes 

20670 Paint & sundries Broad 

20690 Wallpaper & other flexible wallcoverings Broad 

20850 All other merchandise Broad 

20863 Art goods, including original pictures & sculptures Detailed 

20877 Souvenirs & novelty items Detailed 

20878 Seasonal decorations Detailed 

20879 Artificial/silk flowers, plants, & trees Detailed 

29810 All other merchandise Broad 

29900 All nonmerchandise receipts Broad 

29904 Labor charges for work performed by this establishment Detailed 

29905 Labor charges for work contracted out to other establishments Detailed 

29908 Parts & materials used in furniture repair or upholstery work Detailed 

29911 Delivery & installation charges Detailed 

29936 Carpet cleaning receipts for work performed by this establishment Detailed 

29972 All other nonmerchandise receipts Detailed 

1061 

1062 Figure 2-1 presents a description of the process used to estimate the number of establishments 

1063 selling composite wood product lines using a hypothetical example. Within affected industries, the 

1064 number of establishments selling composite wood product lines was estimated as the minimum of: 

1065 

1066  The total number of establishments in the industry, or 

1067  The cumulative sum of the minimum of: 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-19

1068 o the broad product line count, or 

1069 o the sum of the affected detailed product line counts 

1070 for each affected broad product line. 

1071 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-20

1072 

Figure 2-1: Hypothetical Example of Method Used to Refine Establishment Counts 

1073 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-21

1074 As indicated in the hypothetical example in Figure 2-1, the furniture industry sells two broad 

1075 product lines containing composite wood products: household furniture and office furniture. There are 

1076 14,000 establishments that sell the former line and 15,000 that sell the latter. Within the household 

1077 furniture line, two detailed product lines are sold; 8,000 establishments sell “chairs” and 8,000 

1078 establishments sell “sofas.” Because the sum of the establishment counts for the detailed product lines 

1079 (16,000) is greater than the total number of establishments in the broad product line (14,000), the latter 

1080 line count is used. Within the office furniture line, two detailed product lines are sold; 6,000 

1081 establishments sell “desks” and 6,000 sell “chairs.” Because the sum of the establishment counts within 

1082 the detailed product lines (12,000) is less than the broad product line total (15,000), the former count is 

1083 used. The composite wood product lines are summed (26,000) and compared with the industry total. 

1084 This value represents the estimated number of establishments in the furniture industry selling composite 

1085 wood products. It is used in conjunction with the industry total to determine the proportion of the 

1086 affected establishments within the industry, a value which is then applied to firm data to calculate 

1087 industry-specific estimates for the number of affected firms. 

1088 

1089 It is important to note that the estimated number of entities that sell composite wood products is 

1090 likely to be overstated after employing this method of estimation. Using the above example, if the data 

1091 indicate that 14,000 establishments sell household furniture and 12,000 sell office furniture, it is estimated 

1092 that the number of establishments that sell household or office furniture is the sum of these two, or 

1093 26,000. Thus, the analysis assumes that there is no overlap because the number of establishments that sell 

1094 both household and office furniture is not known; that is, no establishments are assumed to sell both 

1095 household and office furniture. 

1096 

1097 The results are presented here for the six digit NAICS, but the calculations described above were 

1098 performed at either the six or seven digit level, depending on which was the most detailed level available 

1099 in the Census data. 

1100 

1101 2.1.4.3 Results 

1102 

1103 This section summarizes the results of the process used to adjust the firm and establishment 

1104 counts to account for the fact that not all entities in the affected wholesale and retail industries sell 

1105 composite wood products. Employer establishment and firm counts are presented first, nonemployer data 

1106 second, and finally, summary data. 

1107 

1108 Employer Establishments 

1109 

1110 Table 2-10 presents estimates of the number of affected wholesale employer establishments by 

1111 NAICS. This is estimated from the percentage of affected establishments in each industry, which is 

1112 calculated from Census data on the number of establishments selling product lines that are expected to 

1113 contain composite wood products. The percentage of affected establishments within each industry is also 

1114 used to adjust the firm counts in Table 2-12, since product line data are not collected at the firm level. 

1115 Note that the total establishment counts in Table 2-10 do not include manufacturers’ sales branches and 

1116 offices. Generally, Census categorizes wholesale establishments into one of two types of operation: 1) 

1117 manufacturers' sales branches and offices, which are “primarily maintained by manufacturing, refining, 

1118 and mining companies apart from their plants or mines for marketing their products at wholesale” (U.S. 

1119 Census Bureau 2010c), and 2) merchant wholesalers, except manufacturers' sales branches and offices. 

1120 Manufacturers’ sales branches and offices are excluded from this analysis, since these firms are already 

1121 counted as fabricators. 

1122 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-22

Table 2-10: Number and Percentage of Affected Wholesale Employer Establishments, by Affected 

NAICS 

NAICS NAICS Description 

Establishments, 

except 

Manufacturers' 

Sales Branches 

and Offices 

Affected 

Establishments 

as a Percent of 

Total 

Affected 

Establishments 

423210 Furniture merchant wholesalers 6,640 100.00% 6,640 

423220 Home furnishing merchant wholesalers 7,540 47.21% 3,560 

423310 Lumber, plywood, millwork, and wood panel merchant 

wholesalers 8,428 100.00% 8,428 

423320 Brick, stone, and related construction material merchant 

wholesalers 3,383 10.20% 345 

423330 Roofing, siding, and insulation material merchant wholesalers 2,587 78.08% 2,020 

423390 Other construction material merchant wholesalers 3,383 84.92% 2,873 

423410 Photographic equipment and supplies merchant wholesalers 1,019 3.83% 39 

423420 Office equipment merchant wholesalers 4,837 2.69% 130 

423430 Computer and software merchant wholesalers 10,668 1.76% 188 

423440 Other commercial equipment merchant wholesalers 4,352 20.01% 871 

423450 Medical equipment merchant wholesalers 8,282 0.81% 67 

423490 Other professional equipment and supplies merchant 

wholesalers 2,297 3.66% 84 

423510 Metal service centers and other metal merchant wholesalers 10,148 12.22% 1,240 

423610 Elec. equip. and wiring merchant wholesalers 13,277 0.78% 103 

423620 Electric appliance merchant wholesalers 3,110 2.38% 74 

423690 Other electronic parts and equipment merchant wholesalers 13,223 0.82% 109 

423710 Hardware merchant wholesalers 6,828 13.96% 953 

423720 Plumbing equip. merchant wholesalers 6,939 26.52% 1,840 

423730 HVAC equip. merchant wholesalers 5,071 16.55% 839 

423740 Refrigeration equipment and supplies merchant wholesalers 1,265 8.77% 111 

423810 Construction equipment merchant wholesalers 4,694 0.49% 23 

423820 Farm and garden machinery and equipment merchant 

wholesalers 8,320 5.13% 427 

423830 Industrial machinery and equipment merchant wholesalers 29,838 1.60% 476 

423840 Industrial supplies merchant wholesalers 8,361 3.56% 298 

423850 Service establishment equipment and supplies merchant 

wholesalers 4,576 14.16% 648 

423910 Sporting and recreational goods and supplies merchant 

wholesalers 6,192 58.28% 3,609 

423920 Toy and hobby goods and supplies merchant wholesalers 2,497 100.00% 2,497 

423930 Recyclable material merchant wholesalers 7,377 0.08% 6 

423940 Jewelry merchant wholesalers 7,792 0.71% 55 

423990 Other miscellaneous durable goods merchant wholesalers 10,185 20.70% 2,108 

424110 Printing and writing paper merchant wholesalers 1,174 2.47% 29 

424120 Stationery and office supplies merchant wholesalers 5,513 21.75% 1,199 

424130 Industrial and personal service paper merchant wholesalers 4,679 2.78% 130 

424210 Drugs and druggists' sundries merchant wholesalers 8,040 1.57% 126 

424310 Piece goods, notions, and other dry goods merchant 

wholesalers 3,445 4.33% 149 

424320 Men's and boys' clothing and furnishings merchant 

wholesalers 4,204 5.14% 216 

424330 Women's and children's clothing merchant wholesalers 7,650 1.49% 114 

424340 Footwear merchant wholesalers 1,649 3.15% 52 

424410 General line grocery merchant wholesalers 2,547 12.92% 329 

424420 Packaged frozen food merchant wholesalers 3,282 1.34% 44 

424450 Confectionery merchant wholesalers 1,938 0.41% 8 

424460 Fish and seafood merchant wholesalers 2,012 0.35% 7 

424480 Fresh fruit and vegetable merchant wholesalers 5,074 0.18% 9 

424490 Other grocery and related products merchant wholesalers 10,562 1.81% 191 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-23

Table 2-10: Number and Percentage of Affected Wholesale Employer Establishments, by Affected 

NAICS 

NAICS NAICS Description 

Establishments, 

except 

Manufacturers' 

Sales Branches 

and Offices 

Affected 

Establishments 

as a Percent of 

Total 

Affected 

Establishments 

424510 Grain and field bean merchant wholesalers 4,851 0.39% 19 

424610 Plastics materials and basic forms and shapes merchant 

wholesaler 3,248 13.73% 446 

424690 Other chemical and allied products merchant wholesalers 8,530 1.08% 92 

424910 Farm supplies merchant wholesalers 7,432 0.98% 73 

424920 Book, periodical, and newspaper merchant wholesalers 2,644 2.38% 63 

424930 Flower, nursery stock, & florists' supplies merchant 

wholesalers 4,213 1.42% 60 

424940 Tobacco and tobacco product merchant wholesalers 1,305 0.46% 6 

424950 Paint, varnish, and supplies merchant wholesalers 1,649 4.73% 78 

424990 Other miscellaneous nondurable goods merchant wholesalers 12,492 6.47% 808 

Total in Affected NAICS 321,242 44,909 

 Sources: U.S. Census Bureau 2010h, 2011

1123 

1124 As indicated in Table 2-10, there are a total of 321,242 wholesale employer establishments not 

1125 including manufacturers’ sales branches and offices. Of this total, an estimated 44,909 establishments 

1126 (approximately 14 percent) sell product lines expected to contain composite wood products. By industry, 

1127 the percent of wholesale establishments selling affected product lines ranges from 0.1 percent (NAICS 

1128 423930) to 100.0 percent (multiple industries). 

1129 

1130 Table 2-11 presents estimates of the number of affected employer establishments in the retail trade 

1131 industries. It also presents the proportions of affected establishments within each industry (i.e., the 

1132 percentage selling product lines expected to contain composite wood products), which are used to adjust 

1133 retail employer firm counts in Table 2-13. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-24

Table 2-11: Number and Percentage of Affected Retail Employer Establishments, by Affected 

NAICS 

NAICS NAICS Description 

Total 

Establishments

Affected 

Establishments 

as a Percent of 

Total 

Affected 

Establishments 

441110 New car dealers 24,888 5.77% 1,437 

441210 Recreational vehicle dealers 3,100 100.00% 3,100 

441221 Motorcycle, ATV, and personal watercraft dealers 6,137 13.33% 818 

441229 All other motor vehicle dealers 2,266 10.90% 247 

441320 Tire dealers 20,127 0.16% 32 

442110 Furniture stores 28,834 100.00% 28,834 

442210 Floor covering stores 14,534 87.71% 12,748 

442291 Window treatment stores 2,652 22.55% 598 

442299 All other home furnishings stores 19,124 100.00% 19,124 

443111 Household appliance stores 9,336 24.21% 2,260 

443112 Radio, television, and other electronics stores 29,051 47.83% 13,896 

443120 Computer and software stores 10,428 7.11% 741 

443130 Camera and photographic supplies stores 1,988 0.91% 18 

444110 Home centers 6,953 100.00% 6,953 

444120 Paint and wallpaper stores 7,860 15.70% 1,234 

444130 Hardware stores 16,454 100.00% 16,454 

444190 Other building material dealers 39,551 78.80% 31,166 

444210 Outdoor power equipment stores 4,357 11.59% 505 

444220 Nursery, garden center, and farm supply stores 15,895 62.42% 9,922 

445110 Supermarkets and other grocery (except convenience) stores 64,881 29.48% 19,128 

445120 Convenience stores 25,510 28.96% 7,387 

445210 Meat markets 6,009 1.63% 98 

445220 Fish and seafood markets 2,063 3.34% 69 

445230 Fruit and vegetable markets 2,938 3.81% 112 

445291 Baked goods stores 4,290 0.79% 34 

445292 Confectionery and nut stores 3,404 7.31% 249 

445299 All other specialty food stores 5,504 10.94% 602 

445310 Beer, wine, and liquor stores 31,485 3.33% 1,047 

446110 Pharmacies and drug stores 42,045 74.76% 31,431 

446120 Cosmetics, beauty supplies, and perfume stores 13,584 0.76% 103 

446130 Optical goods stores 13,149 0.07% 9 

446191 Food (health) supplement stores 8,999 2.28% 205 

446199 All other health and personal care stores 10,675 0.16% 17 

447110 Gasoline stations with convenience stores 97,508 4.80% 4,680 

447190 Other gasoline stations 21,248 1.18% 251 

448110 Men's clothing stores 8,321 6.57% 547 

448120 Women's clothing stores 36,220 9.57% 3,467 

448130 Children's and infants' clothing stores 7,102 39.96% 2,838 

448140 Family clothing stores 28,254 74.85% 21,147 

448150 Clothing accessories stores 7,494 3.70% 277 

448190 Other clothing stores 12,034 8.08% 972 

448210 Shoe stores 28,076 10.19% 2,861 

448310 Jewelry stores 27,745 8.93% 2,478 

448320 Luggage and leather goods stores 1,222 14.98% 183 

451110 Sporting goods stores 22,254 72.13% 16,051 

451120 Hobby, toy, and game stores 9,357 100.00% 9,357 

451130 Sewing, needlework, and piece goods stores 5,663 91.95% 5,207 

451140 Musical instrument and supplies stores 4,510 0.31% 14 

451211 Book stores 9,955 36.57% 3,641 

451212 News dealers and newsstands 1,523 19.24% 293 

451220 Prerecorded tape, compact disc, and record stores 4,153 56.54% 2,348 

452111 Department stores (except discount department stores) 3,533 100.00% 3,533 

452112 Discount department stores 5,001 100.00% 5,001 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-25

Table 2-11: Number and Percentage of Affected Retail Employer Establishments, by Affected 

NAICS 

NAICS NAICS Description 

Total 

Establishments

Affected 

Establishments 

as a Percent of 

Total 

Affected 

Establishments 

452910 Warehouse clubs and supercenters 4,260 100.00% 4,260 

452990 All other general merchandise stores 33,061 100.00% 33,061 

453110 Florists 19,822 76.57% 15,177 

453210 Office supplies and stationery stores 9,558 94.50% 9,032 

453220 Gift, novelty, and souvenir stores 31,391 68.31% 21,442 

453910 Pet and pet supplies stores 8,782 0.74% 65 

453920 Art dealers 6,677 12.88% 860 

453930 Manufactured (mobile) home dealers 3,878 100.00% 3,878 

453991 Tobacco stores 6,539 6.73% 440 

453998 All other miscellaneous store retailers (except tobacco stores) 17,270 28.99% 5,006 

454111 Electronic shopping 14,185 35.67% 5,060 

454113 Mail-order houses 7,324 33.78% 2,474 

454210 Vending machine operators 5,194 0.79% 41 

454311 Heating oil dealers 4,055 30.92% 1,254 

454312 Liquefied petroleum gas (bottled gas) dealers 5,980 25.23% 1,509 

454390 Other direct selling establishments 22,077 24.80% 5,475 

Total in Affected NAICS 1,039,297 404,758 

 Sources: U.S. Census Bureau 2010g, j 

1134 

1135 As indicated in Table 2-11, an estimated 404,758 of the 1,039,297 establishments in the affected 

1136 retail industries (approximately 39 percent) sell product lines expected to contain composite wood 

1137 products. By industry, the percent of retail establishments selling affected product lines ranges from 0.1 

1138 percent (NAICS 446130) to 100.0 percent (multiple industries). 

1139 

1140 Employer Firms 

1141 

1142 Table 2-12 presents estimates of the number of affected wholesale employer firms. Total firm 

1143 counts were adjusted using corresponding establishment ratios to exclude manufacturers’ sales branches 

1144 and offices and prevent potential double-counting of manufacturing firms that have branch offices 

1145 designated as wholesale establishments. Counts were then multiplied by the corresponding affected 

1146 establishment ratios in Table 2-10 to estimate the number of affected employer firms.
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-26

Table 2-12: Number of Affected Wholesale Employer Firms, by Affected NAICS

NAICS NAICS Description 

Total 

Firms in 

Affected 

NAICS 

Manufacturers' 

Sales Branches 

and Offices 

Ratioa

Number of Firms 

Not Including 

Manufacturer's 

Sales Branches 

and Offices 

Affected 

Entity 

Ratiob

Number 

of 

Affected 

Firms 

A B C = (AxB) D E = (CxD) 

423210 Furniture merchant wholesalers 6,172 97.10% 5,993 100.00% 5,993 

423220 Home furnishing merchant wholesalers 6,491 98.48% 6,393 47.21% 3,018 

423310 Lumber, plywood, millwork, and wood panel 

merchant wholesalers 6,475 93.81% 6,074 100.00% 6,074 

423320 Brick, stone, and related construction material 

merchant wholesalers 2,796 82.37% 2,303 10.20% 235 

423330 Roofing, siding, and insulation material 

merchant wholesalers 1,121 92.26% 1,034 78.08% 807 

423390 Other construction material merchant 

wholesalers 2,514 89.81% 2,258 84.92% 1,918 

423410 Photographic equipment and supplies 

merchant wholesalers 886 95.95% 850 3.83% 33 

423420 Office equipment merchant wholesalers 2,895 75.40% 2,183 2.69% 59 

423430 Computer and software merchant wholesalers 8,509 92.40% 7,863 1.76% 139 

423440 Other commercial equipment merchant 

wholesalers 3,962 97.93% 3,880 20.01% 777 

423450 Medical equipment merchant wholesalers 7,197 96.29% 6,930 0.81% 56 

423490 Other professional equipment and supplies 

merchant wholesalers 2,041 96.51% 1,970 3.66% 72 

423510 Metal service centers and other metal 

merchant wholesalers 7,973 93.69% 7,470 12.22% 913 

423610 Elec. equip. and wiring merchant wholesalers 8,622 95.19% 8,207 0.78% 64 

423620 Electric appliance merchant wholesalers 2,576 98.76% 2,544 2.38% 61 

423690 Other electronic parts and equipment 

merchant wholesalers 10,483 94.51% 9,908 0.82% 82 

423710 Hardware merchant wholesalers 5,154 97.74% 5,037 13.96% 703 

423720 Plumbing equip. merchant wholesalers 3,584 98.75% 3,539 26.52% 938 

423730 HVAC equip. merchant wholesalers 2,336 94.33% 2,203 16.55% 364 

423740 Refrigeration equipment and supplies 

merchant wholesalers 758 95.98% 728 8.77% 64 

423810 Construction equipment merchant wholesalers 3,075 95.72% 2,943 0.49% 14 

423820 Farm and garden machinery and equipment 

merchant wholesalers 6,316 98.99% 6,252 5.13% 321 

423830 Industrial machinery and equipment merchant 

wholesalers 24,357 95.09% 23,160 1.60% 369 

423840 Industrial supplies merchant wholesalers 5,808 94.47% 5,487 3.56% 196 

423850 Service establishment equipment and supplies 

merchant wholesalers 3,669 96.97% 3,558 14.16% 504 

423910 Sporting and recreational goods and supplies 

merchant wholesalers 5,661 98.63% 5,583 58.28% 3,254 

423920 Toy and hobby goods and supplies merchant 

wholesalers 2,398 99.72% 2,391 100.00% 2,391 

423930 Recyclable material merchant wholesalers 6,218 100.00% 6,218 0.08% 5 

423940 Jewelry merchant wholesalers 7,570 99.82% 7,556 0.71% 53 

423990 Other miscellaneous durable goods merchant 

wholesalers 9,460 99.17% 9,382 20.70% 1,942 

424110 Printing and writing paper merchant 801 90.94% 728 2.47% 18 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-27

Table 2-12: Number of Affected Wholesale Employer Firms, by Affected NAICS

NAICS NAICS Description 

Total 

Firms in 

Affected 

NAICS 

Manufacturers' 

Sales Branches 

and Offices 

Ratioa

Number of Firms 

Not Including 

Manufacturer's 

Sales Branches 

and Offices 

Affected 

Entity 

Ratiob

Number 

of 

Affected 

Firms 

A B C = (AxB) D E = (CxD) 

wholesalers 

424120 Stationery and office supplies merchant 

wholesalers 4,620 94.00% 4,343 21.75% 945 

424130 Industrial and personal service paper merchant 

wholesalers 4,058 94.74% 3,844 2.78% 107 

424210 Drugs and druggists' sundries merchant 

wholesalers 6,261 94.20% 5,898 1.57% 92 

424310 Piece goods, notions, and other dry goods 

merchant wholesalers 3,150 97.54% 3,072 4.33% 133 

424320 Men's and boys' clothing and furnishings 

merchant wholesalers 3,927 98.87% 3,883 5.14% 200 

424330 Women's and children's clothing merchant 

wholesalers 7,237 99.69% 7,214 1.49% 108 

424340 Footwear merchant wholesalers 1,557 99.40% 1,548 3.15% 49 

424410 General line grocery merchant wholesalers 2,208 100.00% 2,208 12.92% 285 

424420 Packaged frozen food merchant wholesalers 2,994 93.72% 2,806 1.34% 38 

424450 Confectionery merchant wholesalers 1,798 88.45% 1,590 0.41% 7 

424460 Fish and seafood merchant wholesalers 1,924 99.51% 1,914 0.35% 7 

424480 Fresh fruit and vegetable merchant 

wholesalers 4,646 100.00% 4,646 0.18% 8 

424490 Other grocery and related products merchant 

wholesalers 9,668 80.82% 7,814 1.81% 141 

424510 Grain and field bean merchant wholesalers 2,469 100.00% 2,469 0.39% 10 

424610 Plastics materials and basic forms and shapes 

merchant wholesaler 2,734 94.97% 2,597 13.73% 357 

424690 Other chemical and allied products merchant 

wholesalers 6,527 84.14% 5,492 1.08% 59 

424910 Farm supplies merchant wholesalers 4,543 96.05% 4,363 0.98% 43 

424920 Book, periodical, and newspaper merchant 

wholesalers 2,049 93.99% 1,926 2.38% 46 

424930 Flower, nursery stock, & florists' supplies 

merchant wholesalers 3,635 99.88% 3,631 1.42% 52 

424940 Tobacco and tobacco product merchant 

wholesalers 1,135 95.26% 1,081 0.46% 5 

424950 Paint, varnish, and supplies merchant 

wholesalers 1,168 80.05% 935 4.73% 44 

424990 Other miscellaneous nondurable goods 

merchant wholesalers 12,118 98.88% 11,982 6.47% 775 

Total in Affected NAICS 258,304 245,881 34,948 a Firm counts were adjusted to prevent potential double-counting of manufacturing firms that have branch offices 

designated as wholesale establishments. The counts were adjusted according to the percentage of wholesale 

establishments that are not manufacturers’ sales branches and offices. b Firm counts were also adjusted to exclude firms that do not sell any composite wood products, based on the 

percentage of affected establishments in Table 2-10.

Sources: U.S. Census Bureau 2010f, h, 2011 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-28

1147 As indicated in Table 2-12, there are an estimated 245,881 wholesale employer firms not 

1148 including manufacturers’ sales branches and offices. Of this total, it is estimated that 34,948 firms 

1149 (approximately 14 percent) sell product lines containing composite wood products. 

1150 

1151 Table 2-13 presents estimates of the number of affected retail employer firms. Total firm counts 

1152 were adjusted using the corresponding affected establishment ratios in Table 2-11 to estimate the number 

1153 of affected employer firms. 

1154 

Table 2-13: Number of Affected Retail Employer Firms, by Affected NAICS

NAICS NAICS Description 

Total 

Firms in 

Affected 

NAICS 

Affected 

Establishment 

Ratio 

Affected Firms 

441110 New car dealers 21,489 5.77% 1,241 

441210 Recreational vehicle dealers 2,749 100.00% 2,749 

441221 Motorcycle, ATV, and personal watercraft dealers 5,763 13.33% 768 

441229 All other motor vehicle dealers 2,154 10.90% 235 

441320 Tire dealers 11,346 0.16% 18 

442110 Furniture stores 19,714 100.00% 19,714 

442210 Floor covering stores 12,965 87.71% 11,372 

442291 Window treatment stores 2,278 22.55% 514 

442299 All other home furnishings stores 11,560 100.00% 11,560 

443111 Household appliance stores 7,805 24.21% 1,889 

443112 Radio, television, and other electronics stores 14,679 47.83% 7,021 

443120 Computer and software stores 5,550 7.11% 394 

443130 Camera and photographic supplies stores 788 0.91% 7 

444110 Home centers 2,664 100.00% 2,664 

444120 Paint and wallpaper stores 2,399 15.70% 377 

444130 Hardware stores 12,152 100.00% 12,152 

444190 Other building material dealers 30,467 78.80% 24,008 

444210 Outdoor power equipment stores 4,146 11.59% 481 

444220 Nursery, garden center, and farm supply stores 12,804 62.42% 7,993 

445110 Supermarkets and other grocery (except convenience) stores 41,885 29.48% 12,348 

445120 Convenience stores 22,168 28.96% 6,419 

445210 Meat markets 5,502 1.63% 90 

445220 Fish and seafood markets 2,022 3.34% 68 

445230 Fruit and vegetable markets 2,851 3.81% 109 

445291 Baked goods stores 3,126 0.79% 25 

445292 Confectionery and nut stores 2,149 7.31% 157 

445299 All other specialty food stores 4,258 10.94% 466 

445310 Beer, wine, and liquor stores 27,421 3.33% 912 

446110 Pharmacies and drug stores 19,067 74.76% 14,254 

446120 Cosmetics, beauty supplies, and perfume stores 6,861 0.76% 52 

446130 Optical goods stores 5,398 0.07% 4 

446191 Food (health) supplement stores 5,123 2.28% 117 

446199 All other health and personal care stores 7,612 0.16% 12 

447110 Gasoline stations with convenience stores 53,375 4.80% 2,562 

447190 Other gasoline stations 15,666 1.18% 185 

448110 Men's clothing stores 4,952 6.57% 326 

448120 Women's clothing stores 13,582 9.57% 1,300 

448130 Children's and infants' clothing stores 2,724 39.96% 1,089 

448140 Family clothing stores 8,299 74.85% 6,211 

448150 Clothing accessories stores 3,618 3.70% 134 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-29

Table 2-13: Number of Affected Retail Employer Firms, by Affected NAICS

NAICS NAICS Description 

Total 

Firms in 

Affected 

NAICS

Affected 

Establishment 

Ratio 

Affected Firms 

448190 Other clothing stores 7,952 8.08% 642 

448210 Shoe stores 6,867 10.19% 700 

448310 Jewelry stores 18,692 8.93% 1,669 

448320 Luggage and leather goods stores 637 14.98% 95 

451110 Sporting goods stores 17,556 72.13% 12,663 

451120 Hobby, toy, and game stores 5,748 100.00% 5,748 

451130 Sewing, needlework, and piece goods stores 4,124 91.95% 3,792 

451140 Musical instrument and supplies stores 3,585 0.31% 11 

451211 Book stores 4,643 36.57% 1,698 

451212 News dealers and newsstands 1,306 19.24% 251 

451220 Prerecorded tape, compact disc, and record stores 2,343 56.54% 1,325 

452111 Department stores (except discount department stores) 21 100.00% 21 

452112 Discount department stores 14 100.00% 14 

452910 Warehouse clubs and supercenters 12 100.00% 12 

452990 All other general merchandise stores 8,862 100.00% 8,862 

453110 Florists 19,038 76.57% 14,577 

453210 Office supplies and stationery stores 5,317 94.50% 5,024 

453220 Gift, novelty, and souvenir stores 24,106 68.31% 16,466 

453910 Pet and pet supplies stores 5,914 0.74% 44 

453920 Art dealers 6,403 12.88% 825 

453930 Manufactured (mobile) home dealers 2,774 100.00% 2,774 

453991 Tobacco stores 4,940 6.73% 332 

453998 All other miscellaneous store retailers (except tobacco stores) 14,743 28.99% 4,274 

454111 Electronic shopping 13,888 35.67% 4,954 

454113 Mail-order houses 6,471 33.78% 2,186 

454210 Vending machine operators 4,651 0.79% 37 

454311 Heating oil dealers 3,442 30.92% 1,064 

454312 Liquefied petroleum gas (bottled gas) dealers 2,297 25.23% 580 

454390 Other direct selling establishments 20,370 24.80% 5,052 

Total in Affected NAICS 657,847 247,689 

The affected establishment ratio is based on the percentages in Table 2-11.

Sources: U.S. Census Bureau 2010g, j. 

1155 

1156 As indicated in Table 2-13, an estimated 247,689 of the 657,847 employer firms in the affected 

1157 retail industries (approximately 38 percent) sell product lines containing composite wood products. 

1158 

1159 Nonemployer Establishments 

1160 

1161 Table 2-14 and Table 2-15 present estimates of the number of affected nonemployer 

1162 establishments in the wholesale and retail trade sectors, respectively. As with employers, nonemployer 

1163 counts were calculated by applying the affected establishment ratios calculated in Table 2-10 and Table 

1164 2-11 to the total number of nonemployer establishments. 

1165 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-30

Table 2-14: Number of Affected Wholesale Nonemployer Establishments, by Affected NAICS

NAICS NAICS Description 

Total 

Nonemployer 

Establishments 

in Affected 

NAICSa 

Affected 

Establishment 

Ratio 

Affected 

Nonemployer 

Establishments 

423210 Furniture merchant wholesalers 6,487 100.00% 6,487 

423220 Home furnishing merchant wholesalers 7,366 47.21% 3,478 

423310 Lumber, plywood, millwork, and wood panel merchant 

wholesalers 4,056 100.00% 4,056 

423320 Brick, stone, and related construction material merchant 

wholesalers 1,628 10.20% 166 

423330 Roofing, siding, and insulation material merchant wholesalers 1,245 78.08% 972 

423390 Other construction material merchant wholesalers 1,628 84.92% 1,382 

423410 Photographic equipment and supplies merchant wholesalers 328 3.83% 13 

423420 Office equipment merchant wholesalers 1,555 2.69% 42 

423430 Computer and software merchant wholesalers 3,430 1.76% 61 

423440 Other commercial equipment merchant wholesalers 1,399 20.01% 280 

423450 Medical equipment merchant wholesalers 2,663 0.81% 22 

423490 Other professional equipment and supplies merchant wholesalers 739 3.66% 27 

423510 Metal service centers and other metal merchant wholesalers 3,103 12.22% 379 

423610 Elec. equip. and wiring merchant wholesalers 4,828 0.78% 37 

423620 Electric appliance merchant wholesalers 1,131 2.38% 27 

423690 Other electronic parts and equipment merchant wholesalers 4,809 0.82% 39 

423710 Hardware merchant wholesalers 1,685 13.96% 235 

423720 Plumbing equip. merchant wholesalers 1,713 26.52% 454 

423730 HVAC equip. merchant wholesalers 1,252 16.55% 207 

423740 Refrigeration equipment and supplies merchant wholesalers 312 8.77% 27 

423810 Construction equipment merchant wholesalers 1,530 0.49% 7 

423820 Farm and garden machinery and equipment merchant wholesalers 2,712 5.13% 140 

423830 Industrial machinery and equipment merchant wholesalers 9,728 1.60% 156 

423840 Industrial supplies merchant wholesalers 2,726 3.56% 97 

423850 Service establishment equipment and supplies merchant 

wholesalers 1,492 14.16% 211 

423910 Sporting and recreational goods and supplies merchant 

wholesalers 11,126 58.28% 6,485 

423920 Toy and hobby goods and supplies merchant wholesalers 7,410 100.00% 7,410 

423930 Recyclable material merchant wholesalers 8,691 0.08% 7 

423940 Jewelry merchant wholesalers 22,883 0.71% 162 

423990 Other miscellaneous durable goods merchant wholesalers 57,264 20.70% 11,852 

424110 Printing and writing paper merchant wholesalers 695 2.47% 17 

424120 Stationery and office supplies merchant wholesalers 3,264 21.75% 710 

424130 Industrial and personal service paper merchant wholesalers 2,770 2.78% 77 

424210 Drugs and druggists' sundries merchant wholesalers 2,796 1.57% 44 

424310 Piece goods, notions, and other dry goods merchant wholesalers 4,610 4.33% 199 

424320 Men's and boys' clothing and furnishings merchant wholesalers 5,626 5.14% 289 

424330 Women's and children's clothing merchant wholesalers 10,238 1.49% 153 

424340 Footwear merchant wholesalers 2,207 3.15% 70 

424410 General line grocery merchant wholesalers 2,287 12.92% 295 

424420 Packaged frozen food merchant wholesalers 2,948 1.34% 40 

424450 Confectionery merchant wholesalers 1,741 0.41% 7 

424460 Fish and seafood merchant wholesalers 1,807 0.35% 6 

424480 Fresh fruit and vegetable merchant wholesalers 4,557 0.18% 8 

424490 Other grocery and related products merchant wholesalers 9,486 1.81% 171 

424510 Grain and field bean merchant wholesalers 3,326 0.39% 13 

424610 Plastics materials and basic forms and shapes merchant 

wholesaler 1,010 13.73% 139 

424690 Other chemical and allied products merchant wholesalers 2,651 1.08% 28 

424910 Farm supplies merchant wholesalers 2,473 0.98% 25 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-31

Table 2-14: Number of Affected Wholesale Nonemployer Establishments, by Affected NAICS

NAICS NAICS Description 

Total 

Nonemployer 

Establishments 

in Affected 

NAICSa 

Affected 

Establishment 

Ratio 

Affected 

Nonemployer 

Establishments 

424920 Book, periodical, and newspaper merchant wholesalers 14,119 2.38% 336 

424930 Flower, nursery stock, & florists' supplies merchant wholesalers 7,906 1.42% 113 

424940 Tobacco and tobacco product merchant wholesalers 1,219 0.46% 6 

424950 Paint, varnish, and supplies merchant wholesalers 1,769 4.73% 84 

424990 Other miscellaneous nondurable goods merchant wholesalers 44,263 6.47% 2,864 

Total in Affected NAICS 310,687 50,612 a Some of these nonemployer total number of establishments were estimated based on the proportions observed in the employer 

data because information was not available at the 6 digit level, for each of the NAICS codes. 

The affected establishment ratio is based on the percentage of affected entities in Table 2-10. 

 Sources: U.S. Census Bureau 2010d, 2011

1166 

1167 As indicated in Table 2-14, an estimated 50,612 of the 310,687 nonemployer establishments in 

1168 the affected wholesale trade industries (approximately 16 percent) sell product lines containing composite 

1169 wood products. 

1170 

Table 2-15: Number of Affected Retail Nonemployer Establishments, by Affected NAICS

NAICS NAICS Description 

Total 

Nonemployer 

Establishments in 

Affected NAICS a

Affected 

Establishment 

Ratio 

Affected 

Nonemployer 

Establishments 

441110 New car dealers 47,324 5.77% 2,732 

441210 Recreational vehicle dealers 4,294 100.00% 4,294 

441221 Motorcycle, ATV, and personal watercraft dealers 4,171 13.33% 556 

441229 All other motor vehicle dealers 22,751 10.90% 2,480 

441320 Tire dealers 12,149 0.16% 19 

442110 Furniture stores 16,399 100.00% 16,399 

442210 Floor covering stores 11,267 87.71% 9,882 

442291 Window treatment stores 2,056 22.55% 464 

442299 All other home furnishings stores 14,825 100.00% 14,825 

443111 Household appliance stores 6,164 24.21% 1,492 

443112 Radio, television, and other electronics stores 13,548 47.83% 6,480 

443120 Computer and software stores 9,256 7.11% 658 

443130 Camera and photographic supplies stores 1,744 0.91% 16 

444110 Home centers 2,412 100.00% 2,412 

444120 Paint and wallpaper stores 1,945 15.70% 305 

444130 Hardware stores 4,931 100.00% 4,931 

444190 Other building material dealers 17,959 78.80% 14,152 

444210 Outdoor power equipment stores 2,386 11.59% 277 

444220 Nursery, garden center, and farm supply stores 8,704 62.42% 5,433 

445110 Supermarkets and other grocery (except convenience) stores 32,676 29.48% 9,633 

445120 Convenience stores 12,847 28.96% 3,720 

445210 Meat markets 3,264 1.63% 53 

445220 Fish and seafood markets 2,522 3.34% 84 

445230 Fruit and vegetable markets 7,972 3.81% 304 

445291 Baked goods stores 10,637 0.79% 84 

445292 Confectionery and nut stores 8,440 7.31% 617 

445299 All other specialty food stores 13,647 10.94% 1,493 

445310 Beer, wine, and liquor stores 12,021 3.33% 400 

446110 Pharmacies and drug stores 5,738 74.76% 4,289 

446120 Cosmetics, beauty supplies, and perfume stores 82,071 0.76% 622 

446130 Optical goods stores 2,758 0.07% 2 

446191 Food (health) supplement stores 22,062 2.28% 503 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-32

Table 2-15: Number of Affected Retail Nonemployer Establishments, by Affected NAICS

NAICS NAICS Description 

Total 

Nonemployer 

Establishments in 

Affected NAICS a

Affected 

Establishment 

Ratio 

Affected 

Nonemployer 

Establishments 

446199 All other health and personal care stores 26,171 0.16% 42 

447110 Gasoline stations with convenience stores 7,762 4.80% 373 

447190 Other gasoline stations 1,692 1.18% 20 

448110 Men's clothing stores 4,131 6.57% 272 

448120 Women's clothing stores 16,616 9.57% 1,590 

448130 Children's and infants' clothing stores 7,090 39.96% 2,833 

448140 Family clothing stores 13,541 74.85% 10,135 

448150 Clothing accessories stores 20,002 3.70% 739 

448190 Other clothing stores 26,645 8.08% 2,152 

448210 Shoe stores 5,018 10.19% 512 

448310 Jewelry stores 41,651 8.93% 3,720 

448320 Luggage and leather goods stores 2,194 14.98% 329 

451110 Sporting goods stores 21,420 72.13% 15,450 

451120 Hobby, toy, and game stores 14,625 100.00% 14,625 

451130 Sewing, needlework, and piece goods stores 15,910 91.95% 14,629 

451140 Musical instrument and supplies stores 6,071 0.31% 19 

451211 Book stores 10,189 36.57% 3,727 

451212 News dealers and newsstands 11,964 19.24% 2,302 

451220 Prerecorded tape, compact disc, and record stores 3,972 56.54% 2,246 

452111 Department stores (except discount department stores) 2,541 100.00% 2,541 

452112 Discount department stores 3,597 100.00% 3,597 

452910 Warehouse clubs and supercenters 3,064 100.00% 3,064 

452990 All other general merchandise stores 23,777 100.00% 23,776 

453110 Florists 24,122 76.57% 18,469 

453210 Office supplies and stationery stores 6,054 94.50% 5,721 

453220 Gift, novelty, and souvenir stores 53,729 68.31% 36,700 

453910 Pet and pet supplies stores 8,329 0.74% 62 

453920 Art dealers 17,447 12.88% 2,247 

453930 Manufactured (mobile) home dealers 2,211 100.00% 2,211 

453991 Tobacco stores 30,326 6.73% 2,041 

453998 All other miscellaneous store retailers (except tobacco stores) 80,095 28.99% 23,217 

454111 Electronic shopping 53,677 35.67% 19,148 

454113 Mail-order houses 27,714 33.78% 9,362 

454210 Vending machine operators 27,595 0.79% 218 

454311 Heating oil dealers 1,233 30.92% 381 

454312 Liquefied petroleum gas (bottled gas) dealers 1,819 25.23% 459 

454390 Other direct selling establishments 696,865 24.80% 172,819 

Total in Affected NAICS 1,741,799 511,359 a

 Some of these nonemployer total number of establishments were estimated because information was not available at the 6 digit 

level, for each of the NAICS codes. 

The affected establishment ratio is based on the percentage of affected entities in Table 2-11. 

Sources: U.S. Census Bureau 2010d, j 

1171 

1172 As indicated in Table 2-15, an estimated 511,359 of the 1,741,799 nonemployer establishments in 

1173 the affected retail trade industries (approximately 29 percent) sell product lines containing composite 

1174 wood products. 

1175 

1176 Summary 

1177 

1178 As indicated in Table 2-16 and Table 2-17, an estimated 85,560 firms comprising 95,521 

1179 establishments in the wholesale trade sector are estimated to sell composite wood products or goods 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-33

1180 containing composite wood products, while an estimated 759,048 firms comprising 916,117 

1181 establishments in the retail trade sector are estimated to sell such items. 

1182 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-34

1183 

Table 2-16: Total Affected Wholesale Entities, by Affected NAICS

NAICS NAICS Description 

Affected 

Employers 

Affected 

Nonemp. Total Affected 

Estab. Firms 

Firms = 

Estab. Estab. Firms 

A B C D = A+C E= B+C 

423210 Furniture merchant wholesalers 6,640 5,993 6,487 13,127 12,480 

423220 Home furnishing merchant wholesalers 3,560 3,018 3,478 7,038 6,496 

423310 Lumber, plywood, millwork, and wood panel 

merchant wholesalers 8,428 6,074 4,056 12,484 10,130 

423320 Brick, stone, and related construction material 

merchant wholesalers 345 235 166 511 401 

423330 Roofing, siding, and insulation material merchant 

wholesalers 2,020 807 972 2,992 1,779 

423390 Other construction material merchant wholesalers 2,873 1,918 1,382 4,255 3,300 

423410 Photographic equipment and supplies merchant 

wholesalers 39 33 13 52 46 

423420 Office equipment merchant wholesalers 130 59 42 172 101 

423430 Computer and software merchant wholesalers 188 139 61 249 200 

423440 Other commercial equipment merchant wholesalers 871 777 280 1,151 1,057 

423450 Medical equipment merchant wholesalers 67 56 22 89 78 

423490 Other professional equipment and supplies merchant 

wholesalers 84 72 27 111 99 

423510 Metal service centers and other metal merchant 

wholesalers 1,240 913 379 1,619 1,292 

423610 Elec. equip. and wiring merchant wholesalers 103 64 37 140 101 

423620 Electric appliance merchant wholesalers 74 61 27 101 88 

423690 Other electronic parts and equipment merchant 

wholesalers 109 82 39 148 121 

423710 Hardware merchant wholesalers 953 703 235 1,188 938 

423720 Plumbing equip. merchant wholesalers 1,840 938 454 2,294 1,392 

423730 HVAC equip. merchant wholesalers 839 364 207 1,046 571 

423740 Refrigeration equipment and supplies merchant 

wholesalers 111 64 27 138 91 

423810 Construction equipment merchant wholesalers 23 14 7 30 21 

423820 Farm and garden machinery and equipment merchant 

wholesalers 427 321 140 567 461 

423830 Industrial machinery and equipment merchant 

wholesalers 476 369 156 632 525 

423840 Industrial supplies merchant wholesalers 298 196 97 395 293 

423850 Service establishment equipment and supplies 

merchant wholesalers 648 504 211 859 715 

423910 Sporting and recreational goods and supplies 

merchant wholesalers 3,609 3,254 6,485 10,094 9,739 

423920 Toy and hobby goods and supplies merchant 

wholesalers 2,497 2,391 7,410 9,907 9,801 

423930 Recyclable material merchant wholesalers 6 5 7 13 12 

423940 Jewelry merchant wholesalers 55 53 162 217 215 

423990 Other miscellaneous durable goods merchant 

wholesalers 2,108 1,942 11,852 13,960 13,794 

424110 Printing and writing paper merchant wholesalers 29 18 17 46 35 

424120 Stationery and office supplies merchant wholesalers 1,199 945 710 1,909 1,655 

424130 Industrial and personal service paper merchant 

wholesalers 130 107 77 207 184 

424210 Drugs and druggists' sundries merchant wholesalers 126 92 44 170 136 

424310 Piece goods, notions, and other dry goods merchant 

wholesalers 149 133 199 348 332 

424320 Men's and boys' clothing and furnishings merchant 

wholesalers 216 200 289 505 489 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-35

Table 2-16: Total Affected Wholesale Entities, by Affected NAICS

NAICS NAICS Description 

Affected 

Employers 

Affected 

Nonemp. Total Affected 

Estab. Firms

Firms = 

Estab. Estab. Firms

A B C D = A+C E= B+C 

424330 Women's and children's clothing merchant 

wholesalers 114 108 153 267 261 

424340 Footwear merchant wholesalers 52 49 70 122 119 

424410 General line grocery merchant wholesalers 329 285 295 624 580 

424420 Packaged frozen food merchant wholesalers 44 38 40 84 78 

424450 Confectionery merchant wholesalers 8 7 7 15 14 

424460 Fish and seafood merchant wholesalers 7 7 6 13 13 

424480 Fresh fruit and vegetable merchant wholesalers 9 8 8 17 16 

424490 Other grocery and related products merchant 

wholesalers 191 141 171 362 312 

424510 Grain and field bean merchant wholesalers 19 10 13 32 23 

424610 Plastics materials and basic forms and shapes 

merchant wholesaler 446 357 139 585 496 

424690 Other chemical and allied products merchant 

wholesalers 92 59 28 120 87 

424910 Farm supplies merchant wholesalers 73 43 25 98 68 

424920 Book, periodical, and newspaper merchant 

wholesalers 63 46 336 399 382 

424930 Flower, nursery stock, & florists' supplies merchant 

wholesalers 60 52 113 173 165 

424940 Tobacco and tobacco product merchant wholesalers 6 5 6 12 11 

424950 Paint, varnish, and supplies merchant wholesalers 78 44 84 162 128 

424990 Other miscellaneous nondurable goods merchant 

wholesalers 808 775 2,864 3,672 3,639 

Total in Affected NAICS 44,909 34,948 50,612 95,521 85,560 

 Sources:U.S. Census Bureau 2010f, h, l, 2011 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-36

1184 

Table 2-17: Total Affected Retail Entities, by Affected NAICS

NAICS NAICS Description 

Affected Employers

Affected 

Nonemp. Total Affected

Estab. Firms 

Firms = 

Estab. Estab. Firms 

A B C D = A+C E= B+C

441110 New car dealers 1,437 1,241 2,732 4,169 3,973 

441210 Recreational vehicle dealers 3,100 2,749 4,294 7,394 7,043 

441221 Motorcycle, ATV, and personal watercraft dealers 818 768 556 1,374 1,324 

441229 All other motor vehicle dealers 247 235 2,480 2,727 2,715 

441320 Tire dealers 32 18 19 51 37 

442110 Furniture stores 28,834 19,714 16,399 45,233 36,113 

442210 Floor covering stores 12,748 11,372 9,882 22,630 21,254 

442291 Window treatment stores 598 514 464 1,062 978 

442299 All other home furnishings stores 19,124 11,560 14,825 33,949 26,385 

443111 Household appliance stores 2,260 1,889 1,492 3,752 3,381 

443112 Radio, television, and other electronics stores 13,896 7,021 6,480 20,376 13,501 

443120 Computer and software stores 741 394 658 1,399 1,052 

443130 Camera and photographic supplies stores 18 7 16 34 23 

444110 Home centers 6,953 2,664 2,412 9,365 5,076 

444120 Paint and wallpaper stores 1,234 377 305 1,539 682 

444130 Hardware stores 16,454 12,152 4,931 21,385 17,083 

444190 Other building material dealers 31,166 24,008 14,152 45,318 38,160 

444210 Outdoor power equipment stores 505 481 277 782 758 

444220 Nursery, garden center, and farm supply stores 9,922 7,993 5,433 15,355 13,426 

445110 Supermarkets and other grocery (except 

convenience) stores 19,128 12,348 9,633 28,761 21,981 

445120 Convenience stores 7,387 6,419 3,720 11,107 10,139 

445210 Meat markets 98 90 53 151 143 

445220 Fish and seafood markets 69 68 84 153 152 

445230 Fruit and vegetable markets 112 109 304 416 413 

445291 Baked goods stores 34 25 84 118 109 

445292 Confectionery and nut stores 249 157 617 866 774 

445299 All other specialty food stores 602 466 1,493 2,095 1,959 

445310 Beer, wine, and liquor stores 1,047 912 400 1,447 1,312 

446110 Pharmacies and drug stores 31,431 14,254 4,289 35,720 18,543 

446120 Cosmetics, beauty supplies, and perfume stores 103 52 622 725 674 

446130 Optical goods stores 9 4 2 11 6 

446191 Food (health) supplement stores 205 117 503 708 620 

446199 All other health and personal care stores 17 12 42 59 54 

447110 Gasoline stations with convenience stores 4,680 2,562 373 5,053 2,935 

447190 Other gasoline stations 251 185 20 271 205 

448110 Men's clothing stores 547 326 272 819 598 

448120 Women's clothing stores 3,467 1,300 1,590 5,057 2,890 

448130 Children's and infants' clothing stores 2,838 1,089 2,833 5,671 3,922 

448140 Family clothing stores 21,147 6,211 10,135 31,282 16,346 

448150 Clothing accessories stores 277 134 739 1,016 873 

448190 Other clothing stores 972 642 2,152 3,124 2,794 

448210 Shoe stores 2,861 700 512 3,373 1,212 

448310 Jewelry stores 2,478 1,669 3,720 6,198 5,389 

448320 Luggage and leather goods stores 183 95 329 512 424 

451110 Sporting goods stores 16,051 12,663 15,450 31,501 28,113 

451120 Hobby, toy, and game stores 9,357 5,748 14,625 23,982 20,373 

451130 Sewing, needlework, and piece goods stores 5,207 3,792 14,629 19,836 18,421 

451140 Musical instrument and supplies stores 14 11 19 33 30 

451211 Book stores 3,641 1,698 3,727 7,368 5,425 

451212 News dealers and newsstands 293 251 2,302 2,595 2,553 

451220 Prerecorded tape, compact disc, and record stores 2,348 1,325 2,246 4,594 3,571 
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Table 2-17: Total Affected Retail Entities, by Affected NAICS

NAICS NAICS Description 

Affected Employers

Affected 

Nonemp. Total Affected

Estab. Firms 

Firms = 

Estab. Estab. Firms 

A B C D = A+C E= B+C 

452111 Department stores (except discount department 

stores) 3,533 21 2,541 6,074 2,562 

452112 Discount department stores 5,001 14 3,597 8,598 3,611 

452910 Warehouse clubs and supercenters 4,260 12 3,064 7,324 3,076 

452990 All other general merchandise stores 33,061 8,862 23,776 56,837 32,638 

453110 Florists 15,177 14,577 18,469 33,646 33,046 

453210 Office supplies and stationery stores 9,032 5,024 5,721 14,753 10,745 

453220 Gift, novelty, and souvenir stores 21,442 16,466 36,700 58,142 53,166 

453910 Pet and pet supplies stores 65 44 62 127 106 

453920 Art dealers 860 825 2,247 3,107 3,072 

453930 Manufactured (mobile) home dealers 3,878 2,774 2,211 6,089 4,985 

453991 Tobacco stores 440 332 2,041 2,481 2,373 

453998 All other miscellaneous store retailers (except 

tobacco stores) 5,006 4,274 23,217 28,223 27,491 

454111 Electronic shopping 5,060 4,954 19,148 24,208 24,102 

454113 Mail-order houses 2,474 2,186 9,362 11,836 11,548 

454210 Vending machine operators 41 37 218 259 255 

454311 Heating oil dealers 1,254 1,064 381 1,635 1,445 

454312 Liquefied petroleum gas (bottled gas) dealers 1,509 580 459 1,968 1,039 

454390 Other direct selling establishments 5,475 5,052 172,819 178,294 177,871 

Total in Affected NAICS 404,758 247,689 511,359 916,117 759,048 

 Sources: U.S. Census Bureau 2010g, j, l 

1185 
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May 1, 2013 2-38

1186 2.2 Third Party Testing and Certification Costs 

1187 

1188 This analysis presents cost estimates assuming that the costs of complying with certification 

1189 requirements under TSCA Title VI will be the same as complying with the requirements of the CARB Air 

1190 Toxics Control Measure (ATCM) to reduce formaldehyde emissions from composite wood products. It is 

1191 also assumed that mills that are certified by a CARB-approved TPC will not have to generate new testing 

1192 data or incur significant costs to become certified by a TPC under the TSCA Title VI rule. TSCA Title 

1193 VI requires composite panel producers to perform formaldehyde emission testing on their composite 

1194 wood products and attain certification from an accredited third-party certifier (TPC). Producers must 

1195 undergo qualifying tests at a TPC lab, obtain an on-site audit from a TPC, implement quality control 

1196 systems, and train quality control employees in order to receive initial certification. Once a TPC certifies 

1197 a mill’s products, that mill is required to conduct on-going quality control testing, submit monthly reports 

1198 to the TPC, and receive quarterly on-site audits and testing by its TPC to maintain its certified status. 

1199 Mills that manufacture products made with no-added formaldehyde (NAF) resins that meet more stringent 

1200 emissions limits may apply for exemptions from some of the on-going testing requirements. 

1201 

1202 CARB has accredited nine U.S. third-party certifiers to offer formaldehyde certification and 

1203 testing programs. However, about 90 percent of the U.S. mills that have been certified to produce CARB1204 compliant products have the Composite Panel Association (CPA) or the Hardwood Plywood and Veneer 

1205 Association (HPVA) as their TPC. Therefore, this analysis relies on the prices charged by CPA and 

1206 HPVA (Personal Communication with CPA 2011 and Personal Communication with HPVA 2011b) for 

1207 TPC services in order to estimate the costs associated with obtaining and maintaining certification under 

1208 TSCA Title VI. 

1209 

1210 2.2.1 Certification Fees 

1211 

1212 CPA and HPVA charge administrative fees to mills for certifying their products. CPA charges a 

1213 quarterly fee of $1,500 regardless of NAF or ULEF status, which is equivalent to $6,000 per year. HPVA 

1214 charges an annual program fee of $4,500 to $5,500 (depending on membership status) to mills that are not 

1215 NAF or ULEF certified. Mills with ULEF or NAF certifications are required to pay the standard annual 

1216 program fee in the first year and an annual fee of $2,700 to $3,700 in all subsequent years. For simplicity, 

1217 this analysis assumes that the annual certification fee for mills without an NAF or ULEF exemption is 

1218 $6,000, and that the fees for mills with a ULEF- or NAF exemption are $6,000 for the initial year, and 

$3,700 in all subsequent years.12 1219 

1220 

Table 2-18: Certification Fees

Cost Category Certification Type Fee 

Initial Fee All $6,000 

Annual Fee Standard $6,000 

NAF/ULEF $3,700 

1221 

1222 2.2.2 Qualifying Test and Statistical Correlation 

1223 

1224 Under TSCA Title VI, a composite panel producer is required to obtain qualifying tests for each 

1225 product type (e.g., hardwood plywood – veneer core) and production line from the mill for which 

1226 certification is sought. A TPC employee must select and mark the panels to be tested during the initial 

 12 NAF and ULEF certifications apply to product lines, and not necessarily to the entire facility. Mills with multiple 

product lines could have one or more lines certified as NAF or ULEF, and other lines that are not. The NAF and ULEF 

testing costs do not apply to any product lines that are not NAF or ULEF certified. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-39

1227 mill audit, with at least one panel being selected for each test. After panel selection has occurred, the mill 

1228 must ship the marked panels to the TPC for testing at the TPC facility. This testing can be performed 

1229 using the ASTM E-1333-10 test method (which is commonly referred to as a large chamber or large scale 

1230 test, and which is termed the primary test method under the CARB ATCM). Testing can also be 

1231 performed under the TSCA Title VI rule using the ASTM D-6007-02 test method (which is commonly 

1232 referred to as a small chamber test, and which is termed the secondary test method under the CARB 

1233 ATCM), upon a showing of equivalence with ASTM E-1333-10. However this analysis assumes that all 

1234 qualifying testing is performed using the large chamber test method. Results from the five large chamber 

1235 tests must not exceed the emission standards for each product type and production line. 

1236 

1237 In addition to the qualifying testing performed via the large chamber test method, a mill must 

1238 perform on-going quality control testing on the applicable products. Quality control testing is typically 

1239 performed under the CARB ATCM using a small chamber test (ASTM D6007) or desiccator test (ASTM 

1240 D5582), and it is assumed that these will be the most commonly used quality control tests under the 

1241 TSCA Title VI rule. These tests require smaller test samples and can be conducted at the TPC facility, 

1242 contract lab, or on-site at a TPC-approved lab at the composite wood mill. The TPC must develop a 

1243 statistical correlation between the large chamber and small scale test methods using a minimum of five 

1244 data pairs. It is assumed that mills will need to obtain all five data pairs during qualifying testing, though 

1245 it is possible that some mills may be able to use previous test results or data obtained from the resin 

1246 manufacturer. Each large chamber test requires results from one small chamber test or three desiccator 

1247 tests to calculate the correlation. TSCA Title VI requires producers to obtain quality control test results 

1248 for a production lot before product from that lot can be shipped, so it is likely that producers will perform 

1249 quality control testing on-site to minimize the time taken to obtain testing results. This analysis assumes 

1250 that producers not currently performing testing on-site will purchase and operate a small chamber testing 

1251 unit for quality control testing. 

1252 

CPA and HPVA charge between $400 and $48013 1253 , though this analysis assumes that mills will 

1254 incur the higher cost of $480 for each test. Producers that perform quality control testing on-site will 

1255 need to perform a small chamber equivalence test for each large chamber test. It is assumed that each 

1256 equivalence test will take two hours to perform. 

1257 

1258 In addition to the testing fee, mills will also incur costs associated with shipping panels to the 

TPC, lost product, and labor time needed to prepare the panels14 1259 for shipping. Mills are expected to ship 

1260 at least five 4’ x 8’ panels for each product type via a commercial shipping carrier. Panels must be dead1261 stacked (i.e., having no layers between panels), bundled air-tight, wrapped in polyethylene, and protected 

1262 by cover sheets. Based on conversations with CPA and with CARB-certified mills, the total shipping cost 

1263 for the qualifying tests is estimated to be approximately $200 per product line. 

1264 

1265 This analysis estimated the cost of each panel using the average cost per square foot of hardwood 

1266 plywood, $0.49 and particleboard, $0.28 (RISI 2011c(RISI 2010).). Assuming a panel size of 32 sq. ft., 

1267 each hardwood plywood panel will cost the mill $15.68, and each particleboard panel will cost $8.96. 

1268 The analysis assumes that it will take a managerial-level employee half an hour to prepare the panels for 

1269 shipping. Using data published by the U.S. Bureau of Labor Statistics (BLS), EPA estimated the average 

1270 loaded hourly wage for a managerial position within the Veneer, Plywood, and Engineered Wood 

Products Industry to be $71.36.15 1271 Table 2-19 summarizes the initial unit testing costs, including fees, 

1272 preparation, lost product, and shipping. 

 13 This is the rate charged by HPVA’s Reston Lab to non-members for testing panels. This lab charges non-members 

$660 to test doors, $840 to test finished engineered wood flooring, and $480 to test furniture and cabinets. 14 The panels for the qualifying tests are selected during the initial on-site audit. 

15 The Occupational Employment Statistics (published by BLS for May, 2009) reportsU.S. Bureau of Labor Statistics 

2010b the average hourly wage for all management occupations in NAICS 321200 to be $44.46. Employer Costs for 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-40

1273 

Table 2-19: Qualifying Test Costs 

Cost Category Description Unit Cost 

Number 

of Units 

Cost for 

PB/MDF 

Cost for 

HWPW 

Large Scale Testing Large Chamber $480 5 tests $2,400 $2,400

Small Scale Testing 

at Mill Labor $71.36 10 hours $714 $714 

Shipping Five 4' x 8' panels $200 1 shipment $200 $200 

Labor $71.36 0.5 hours $36 $36 

Lost Product PB/MDF $8.96 5 panels $45 N/A

HWPW $15.68 5 panels N/A $78

Total $3,394 $3,428

Sources: U.S. Bureau of Labor Statistics 2010b, Personal Communication with CPA 2011, Personal 

Communication with HPVA 2011b, RISI 2011cBLS 2010; Communications with CPA and HPVA; RISI 2011..

1274 

1275 2.2.3 Quality Control Procedures 

1276 

1277 Under TSCA Title VI, mills will be required to ensure that all manufactured composite wood 

1278 products meet the formaldehyde emission standards by implementing routine quality control procedures 

1279 and receiving periodic quality control reviews from a third-party certifier. The following sections provide 

1280 details of the requirements and costs associated with receiving on- and off-site audits, developing quality 

1281 control systems, and conducting routine quality control testing. 

1282 

1283 2.2.3.1 Quality Control Audits 

1284 

1285 The TPC is responsible for conducting on-site visits to certified mills. Before the initial 

1286 certification, the TPC is expected to make at least one trip to the mill to inspect the mill’s quality control 

1287 and quality assurance systems and employees. During the initial visit, the TPC will assist the mill in 

1288 setting up quality control systems, including the quality control testing facility, if applicable, and methods 

1289 for selecting samples. After certification has been granted, the TPC is obligated to perform an on-site 

1290 audit at least once quarterly, unless the mill obtains NAF certification. Audits typically do not take more 

1291 than one day of travel and visitation, though if the mill requires a substantial number of modifications or 

1292 is unprepared, the duration of the visit may be longer (Personal Communication with HPVA 

1293 2011b(HPVA 2011).). TPCs may also conduct periodic “desk audits,” which are quality control checks 

1294 performed over the phone in which the mill’s quality control testing procedures and data are reviewed. 

1295 

1296 The cost of the audit is borne by the composite panel producer and has two components: audit 

1297 fees and travel costs. Site audit fees can range from $300 to $450 for initial visits and from $400 to $450 

1298 for quarterly visits, depending on the TPC. Travel costs can vary depending on the relative location of the 

1299 mill to the TPC; mills within a close proximity may not incur any travel costs, whereas a mill across the 

1300 country may incur travel costs of up to $2,000 per visit. It is assumed that travel is only necessary for the 

1301 annual audits, as other intermediate audits can be performed by contracting inspectors closer to the mill. 

1302 The fees for the desk audits range from $200 to $250 per audit, and no travel is required. Based on these 

1303 ranges, this analysis assumes that initial site audits will cost a mill $1,950 per visit ($450 fee plus $1,500 

1304 travel), quarterly audits will cost $450 per visit, and desk audits will cost $250 per review. In addition to 

1305 the fees charged by the TPC, mills will also incur labor costs associated with the audit process. This 

1306 analysis assumes that a managerial-level employee will be present for eight hours during the initial on-site 

 Employee Compensation (ECEC) data (also published by BLS) for all private industry occupations were used to inflate 

the wage to $44.88 in 2010 dollars. ECEC data were also used to estimate that benefits accounted for approximately 

29.3 percent of total compensation. Assuming a 17 percent rate of overhead on wages (not including benefits), total 

hourly compensation is estimated to be $71.36. 
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May 1, 2013 2-41

1307 audit, four hours for every on-site audit thereafter, and one hour for each desk audit. Table 2-20 

1308 summarizes the audit costs described above. 

1309 

Table 2-20: Quality Control Audit Costs 

Cost Category Unit Cost Number of Units Travel Cost Total Cost 

TPC Fees 

Initial Audit $450 1 audit $1,500 $1,950 

Annual On-Site Audit $450 1 audit $1,500 $1,950 

Other On-Site Audit $450 1 audit $0 $450 

Desk Audit $250 1 audit $0 $250 

Mill Labor Costs 

Initial Audit $71.36 8 hours N.A. $571 

Annual On-Site Audit $71.36 4 hours N.A. $285 

Other On-Site Audit $71.36 4 hours N.A. $285 

Desk Audit $71.36 1 hour N.A. $71 

Sources: U.S. Bureau of Labor Statistics 2010bBLS 2010; Communications with CPA and HPVA., Personal 

Communication with CPA 2011, Personal Communication with HPVA 2011b 

1310 

1311 2.2.3.2 Quality Control Manual and Personnel 

1312 

1313 Mills are required to implement quality control procedures to ensure that all certified products 

1314 consistently meet the applicable emissions standards. In addition, the rule requires each mill to designate 

1315 a quality control manager and quality control employees, if needed. The quality control manager must 

1316 have adequate training or experience to handle all quality control procedures, including on-site testing and 

1317 shipping samples for TPC testing. All quality control procedures and designated quality control 

1318 personnel must be identified in a quality control manual. Prior to the mill’s initial certification, the TPC 

1319 will assist mills in developing and documenting appropriate quality control procedures. In some cases, 

1320 the mill’s resin supplier will also help to train quality control employees and develop quality control 

1321 procedures. 

1322 

1323 Based on conversations with CPA, HPVA, and composite panel producers, it is assumed that 

1324 training, implementing quality control systems, and developing the quality control manual could take 

1325 between one and five days to complete, depending on the mill’s existing quality control systems. HPVA 

1326 and CPA noted that smaller mills often do not have quality control systems in place and that developing 

1327 these systems can be a time-consuming process. This analysis estimates that a managerial-level employee 

1328 will spend forty hours training, becoming familiarized with the testing and certification requirements, 

1329 writing the quality control manual, and setting up quality control systems and testing procedures. 

1330 

1331 2.2.3.3 Routine Quality Control Testing 

1332 

1333 To maintain certification, a mill must perform routine quality control testing for each certified 

1334 product type and production line. Quality control testing is typically performed using one of the 

1335 correlated small scale test methods described in Section 2.2.1 – a small chamber test (ASTM D6007) or a 

1336 desiccator (ASTM D5582). 

1337 

1338 The frequency of the required quality control testing depends on the product type and, for 

1339 hardwood plywood, the production volume. Hardwood plywood plants producing 100 thousand square 

1340 feet (msf) or less per week are required to test once per 100 msf; plants more than 100 msf but less than 

1341 200 msf per week must test once per week; plants producing more than 200 msf but less than 400 msf per 

1342 week are required to test twice per week; and those producing 400 msf or more per week are required to 

1343 test four times per week. Particleboard and MDF producers must test samples at least once per eight or 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-42

1344 twelve hour shift, but this frequency may be reduced to one test per forty-eight hours if the plant or 

1345 production line has shown consistent operations and low variability of test results. This analysis makes 

1346 the simplifying assumption that all producers will test each production line once daily. This results in a 

1347 conservative estimate of the cost of quality control testing for hardwood plywood producers. 

1348 

1349 Mills have the option of constructing an on-site lab and having it approved by a TPC, or 

1350 contracting with a certified third-party lab to perform their quality control testing. The decision to 

1351 perform on-site testing is dependent on the relative costs of building and running an on-site lab, and the 

1352 fees and shipping costs associated with hiring a third-party lab. According to CPA and HPVA, 

1353 particleboard and MDF mills already have their own on-site labs to test for formaldehyde (because they 

1354 have to test their products on a daily basis under the CARB ATCM), while most smaller hardwood 

1355 plywood mills pay their TPC to conduct their quality control testing (In part because hardwood plywood 

1356 mills often use ULEF or NAF resins to qualify for exemptions from some of the on-going testing 

1357 requirements under the CARB ATCM). However, the CARB ATCM allows mills to ship panels from 

1358 certified product lines before test results are available. By contrast, the proposed TSCA rule requires 

1359 mills to wait until test results indicate that the emissions standards have been met before shipping a lot 

1360 that has been tested. It is uncertain how often mills currently ship product from a lot being tested before 

1361 the test results are available and therefore it is uncertain how mills will choose to comply with this 

1362 requirement. It may be the case that some mills normally maintain a level of inventory where they would 

1363 typically not ship any panels before test results have been determined for that lot, but other mills may ship 

1364 out panels on the same day they are produced. This analysis assumes that all mills that do not already do 

1365 so will opt to set up and operate a quality control testing facility on-site, in order to minimize the time 

1366 spent waiting for test results, and to maximize their flexibility to ship out panels shortly after they have 

1367 been produced (Assuming that mills conduct on-site testing may overstate the costs of this requirement if 

1368 some mills find it more cost effective to hold products in inventory until test results have been determined 

1369 by an outside lab). 

1370 

1371 Panel producers that have not already set up their own quality control testing facilities due to the 

1372 CARB ATCM will incur the cost of setting up a controlled lab environment, purchasing testing 

1373 equipment, and operating the lab on an on-going basis. It is assumed that each mill will incur an initial 

1374 cost of $10,000 to create a lab and purchase small chamber or desiccator testing units. It is assumed that 

1375 the quality control manager will spend two hours each day performing routine quality control testing at a 

1376 loaded wage rate of $71.36 per hour. It is also assumed that one panel will be needed for testing from 

1377 each production line at a cost of $15.68 per hardwood plywood panel and $8.96 per particleboard panel. 

1378 (See Section 2.2.2 for a description of how these costs were estimated.) 

1379 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-43

Table 2-21: Routine Small Scale Testing Costs

Cost Category Unit Cost Number of Units Time Period Total Cost 

Hardwood Plywood Producers with Weekly Small Scale Testing Performed by TPCs

Routine Test Fee $154a 2 tests Weekly $308

Shipping $50 1 test Weekly $50

Lost Product $15.68 1 panel Weekly $15.68

Labor $71.36 1.5 hours Weekly $107

Hardwood Plywood Producers Performing Their Own Daily Small Scale Testing a

Setup Lab $10,000 1 lab One-Time $10,000 

Lost Product $15.68 1 panel Daily $15.68 

Labor $71.36 2 hours Daily $143 

Particleboard Producers Performing Their Own Daily Small Scale Testing 

Setup Lab $10,000 1 lab One-Time $10,000 

Lost Product $8.96 1 panel Daily $8.96 

Labor $71.36 2 hours Daily $143 

a. It is assumed that hardwood plywood producers that are not CARB certified have a production volume 

that would require testing on weekly basis. The producers could have the products tested at a third-party 

lab, but it is assumed they will choose to perform daily tests at their own small scale lab because of the 

requirement in the TSCA Title VI rule that production lots that have been tested cannot be shipped until the 

test results indicate the emissions standards have been met. 

Sources: U.S. Bureau of Labor Statistics 2010b, Personal Communication with CPA 2011, 

Personal Communication with HPVA 2011b, RISI 2011cBLS, 2010; Communications with CPA 

and HPVA; RISI, 2010..

1380 

1381 2.2.4 NAF and ULEF Certifications 

1382 

1383 Under the proposed option, products made with NAF and ULEF resins may be eligible for 

1384 reduced large chamber and small scale testing frequencies. The application process for NAF and ULEF 

1385 certification includes an initial quality control testing period, and quarterly tests to be performed by the 

1386 TPC. The results from these tests must meet the emissions limits for NAF and ULEF certification 

1387 specified by TSCA Title VI in order for a product line to be exempt from quarterly TPC testing and/or to 

1388 have reduced testing frequencies. The proposed option does not provide for reduced testing frequencies 

1389 for products made with ULEF resins.

1390 

1391 2.2.4.1 NAF and ULEF Emissions Standards 

1392 

1393 Product lines certified as using NAF and ULEF resins may be exempt from some of the quarterly 

1394 TPC testing and routine QC testing. NAF certification can be achieved by performing three months of 

1395 routine quality control testing and one quarterly large or small chamber test at the TPC. Ninety percent of 

1396 the results from routine testing and the result from the quarterly TPC test must be no higher than 0.04 

1397 ppm; all test results must be no higher than 0.05 ppm for hardwood plywood, and 0.06 ppm for 

1398 particleboard, MDF, and thin MDF. Product lines approved for NAF certification are exempt from 

1399 routine quality control testing and quarterly TPC testing for two years. After two years, the mill may 

1400 reapply for NAF certification based on the results of at least one large or small chamber test. 

1401 

1402 The CARB ATCM proposed option also allows for reduced testing frequencies for ULEF 

1403 products. AsUnder the TSCA Title VI proposed option does not include reduced testing allowances for 

1404 ULEF product lines, mills withseeking ULEF certification would incur higher testing and certification 

1405 costs under the proposed rule. The CARB ATCM requires a millare required to perform quality control 

1406 testing on the ULEF product type for the first sixth months after the initial certification and two quarterly 

1407 large or small chamber TPC tests. For hardwood plywood products to be exempt from additional 
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May 1, 2013 2-44

1408 quarterly TPC testing and routine quality control testing, the two initial quarterly TPC tests and ninety 

1409 percent of the initial quality control tests must have emissions no higher than 0.04 parts per million 

1410 (ppm), and all tests results must be no higher than the cap value of 0.05 ppm. A hardwood plywood 

1411 product line meeting these requirements would be exempt from quarterly TPC testing and routine quality 

1412 control testing for the two year duration of the approval. Product lines that do not meet the target value of 

1413 0.04 ppm may receive approval for semiannual, rather than quarterly, large or small chamber TPC testing 

1414 if all results are below the cap value of 0.05 ppm. If ninety percent of the quality control tests have 

1415 emissions no higher than 0.05 ppm and all tests results are no higher than the cap value of 0.05 ppm, 

1416 hardwood plywood products may be approved for a reduction in TPC testing (semiannually instead of 

quarterly), and in quality control testing frequency (weekly16 1417 ). ULEF certifications expire after two years, 

1418 at which time a mill may reapply by submitting test results from at least two large or small chamber tests.

1419 

1420 For particleboard, MDF, and thin MDF product lines, ninety percent of the results from the 

1421 quality control test results and the results of the two quarterly tests must be no higher than the ULEF1422 target values listed in Table 2-22; all results must be lower than the ULEF-cap values. Particleboard, 

1423 MDF, and thin MDF products that meet the exemption values may be approved for an exemption from 

1424 the quarterly TPC testing and routine quality control testing for two years. Products that meet the quality 

1425 control testing reduction values may be approved for a reduction in TPC testing (semiannually instead of 

1426 quarterly), and in quality control testing frequency (weekly instead of once per eight to twelve hour shift). 

1427 ULEF certifications expire after two years, at which time a mill may reapply by submitting test results 

1428 from at least two large or small chamber tests. 

1429 

1430 Table 2-22 summarizes the TSCA Title VI and CARB ATCM emissions standards for each 

1431 product type and certification type. Table 2-23 presents the amount of testing and the results required to 

1432 apply for each type of NAF/ULEF certification under TSCA Title VI and the CARB ATCM. 

1433 

Table 2-22: Summary of Emissions Standards by Product Type (parts per million)

Product Type 

Standard 

Certification 

 NAF 

ULEF 

(Quarterly TPC 

Test 

Exemption)c

ULEF (QC Testing 

Reduction)c

Target Valuesa

Hardwood Plywood 0.05 0.04 0.04 0.05 

Particleboard 0.09 0.04 0.04 0.05 

MDF 0.11 0.04 0.04 0.06 

Thin MDF 0.13 0.04 0.04 0.08 

Cap Valuesb

Hardwood Plywood 0.05 0.05 0.05 0.05 

Particleboard 0.09 0.06 0.06 0.08 

MDF 0.11 0.06 0.06 0.09 

Thin MDF 0.13 0.06 0.06 0.11 

a. Ninety percent of routine quality control test results, and all quarterly TPC test results must be no higher than these 

values. 

b. All routine quality control and quarterly TPC test results must be no higher than these values.

c. As prescribed by the CARB ATCM. The proposed option under TSCA Title VI does not include reduced testing for 

ULEF products.

1434 

 16 Hardwood plywood products that qualify for less frequent testing because their production volume is less than 100,000 

square feet per week may continue to perform quality control testing at that frequency. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-45

Table 2-23: NAF and ULEF Certification Testing Requirements (Test Results in ppm)

 NAF ULEFaULEF

 Product Type 

Routine Quality 

Control Testing 

Quarterly Large or 

Small Chamber TPC 

Testing 

 Routine Quality 

Control Testing 

Quarterly Large or 

Small Chamber TPC 

Testing 

Testing Requirements 

HWPW 

Weeklyb

Weeklya for 3 

months One test 

Weeklyb

Weeklya for 6 

months Two tests 

PB/MDF/Thin MDF 

Once per 8-12 hour 

shift for 3 months One test 

Once per 8-12 hour 

shift for 6 months Two tests 

Test Results Needed for TPC and QC Testing Exemption 

HWPW 

90% ≤ 0.04 

100% ≤ 0.05 1 test ≤ 0.04 

90% ≤ 0.04 

100% ≤ 0.05 2 tests ≤ 0.04 

PB/MDF/Thin MDF 

90% ≤ 0.04 

100% ≤ 0.06 1 test ≤ 0.04 

90% ≤ 0.04 

100% ≤ 0.06 2 tests ≤ 0.04 

Test Results Needed for QC Testing Frequency Reduction 

HWPW N/A N/A 100% ≤ 0.05 2 tests ≤ 0.05 

Particleboard N/A N/A 

90% ≤ 0.05 

100% ≤ 0.08 2 tests ≤ 0.08 

MDF N/A N/A 

90% ≤ 0.06 

100% ≤ 0.09 2 tests ≤ 0.09 

Thin MDF N/A N/A 

90% ≤ 0.08 

100% ≤ 0.11 2 tests ≤ 0.11 

 

a. As prescribed by the CARB ATCM. The proposed option under TSCA Title VI does not include reduced testing for ULEF products.

b.a. Testing frequency for HWPW depends on production volume. Testing is assumed to be weekly for purposes of this analysis. 

1435 

1436 The CARB ATCM sets a minimum threshold for quality control testing requirements for NAF 

1437 and ULEF products but, based on communications with HPVA and with CARB-certified mills, some 

1438 TPCs may have more stringent requirements. For example, HPVA requires mills to have on-site audits 

1439 and large chamber tests annually for NAF-certified products, and quarterly for ULEF-certified products, 

1440 which is more frequently than the CARB rule requires. This analysis therefore assumes that TPCs test 

1441 and audit mills with NAF or ULEF-certified product lines more frequently than the CARB ATCM or 

1442 TSCA Title VI requires. As noted in Section 2.2.1, it is assumed that mills will pay reduced recurring 

1443 administrative fees to the TPC after achieving ULEF or NAF certification status. Table 2-24 summarizes 

1444 the differences between how TPCs are assumed to implement a standard certification and a certification 

1445 with an NAF or ULEF exemption. 

1446 
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Table 2-24: Testing and Certification Frequencies Assumed to be Implemented by TPCs 

Category Standard NAF ULEF

Certification Fee Annual 

Annual (reduced fee after first 

year) 

Annual (reduced fee after first 

year) 

Qualifying Testing One-time One-time One-time 

TPC Audit Quarterly 

Twice initially and annually 

thereafter 

Twice initially and annually 

thereafter 

TPC Audit Travel First audit each year Annual Annual 

Large Chamber TPC 

Testing Quarterly 

Once initially and annually 

thereafter 

Once initially and quarterly 

thereafter 

QC Testing On-going 

First 3 months and exempt 

thereafter 

First 6 months and exempt or 

reduced thereafter 

Desk Audit 

Monthly (excludes 

audit months) 

First 2 months and exempt 

thereafter 

First 4 months and exempt 

thereafter 

1447 

1448 2.2.5 Average Certification and Testing Costs per Mill 

1449 

1450 As described at the beginning of this section, all U.S. hardwood plywood mills that are not CARB 

1451 certified in the baseline are assumed to apply for NAF certification, but particleboard mills are less likely 

1452 to become NAF- certified. However, as some mills may not become NAF-certified in practice, the next 

1453 section presents a range of certification costs. To simplify the analysis, testing and certification costs for 

1454 a “typical” mill were estimated using the unit costs described above. This analysis assumes that a 

1455 hardwood plywood mill will produce two product types (i.e., hardwood plywood with veneer core and 

1456 composite core) and not exceed a production volume of 200 msf per week. The typical particleboard or 

1457 MDF mill is assumed to produce two product types and test once daily for five days each week. 

1458 

1459 Some mills with existing CARB-certified product lines might certify an additional product line 

1460 under TSCA Title VI or change certification types (e.g., without exemptions for NAF).. These mills 

1461 would be paying certification fees in the baseline and so would not incur the total cost of fees as a result 

1462 of TSCA Title VI. It is assumed that mills will coordinate audits needed for certifying a new product 

1463 under TSCA Title VI with the audits already being performed for CARB certified products. Note that 

1464 particleboard and MDF mills having ULEF certifications in the baseline are assumed to be exempthave 

1465 the exemption from routine testing requirements after the first six months under the CARB ATCM. 

1466 Though some mills may only have reduced testing frequencies, this assumption results in a higher 

1467 incremental cost to rather than the exemption, most mills switching from ULEF certificationsunder the 

1468 CARB ATCM have sought the exemption instead of the reduced testing. 

1469 

1470 The CARB ATCM allows mills to ship panels from certified product lines before test results are 

1471 available. By contrast, the proposed TSCA rule requires mills to wait until test results indicate that the 

1472 emissions standards have been met before shipping a lot that has been tested. Panel producers that have 

1473 not already set up their own quality control testing facilities due to the CARB ATCM will incur the cost 

1474 of setting up a controlled lab environment, purchasing testing equipment, and operating the lab on an on1475 going basis. It is assumed that each mill will incur an initial cost of $10,000 to create a lab and purchase 

1476 small chamber or desiccator testing units. It is assumed that the quality control manager will spend two 

1477 hours each day performing routine quality control testing at a loaded wage rate of $71.36 per hour. It is 

1478 also assumed that one panel will be needed for testing from each production line at a cost of $15.68 per 

1479 hardwood plywood panel and $8.96 per particleboard panel. (See Section 2.2.2 for a description of how 

1480 these costs were estimated.)

1481 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-47

1482 This analysis also presents estimated testing and certification costs for wood veneer laminated 

product producers in the event that they are subject to these requirements.17 1483 Wood veneer laminators are 

1484 assumed to have testing and certification costs that are similar to stock hardwood plywood mills. Many 

1485 wood veneer laminated product producers produce panels in small batches according to customer 

1486 specifications, and therefore their production may include more variety in terms of core types and face 

1487 veneers compared to stock panel producers. Nevertheless, the analysis assumes that wood veneer 

1488 laminated product producers can limit the number of product lines requiring certification to no more than 

1489 two – one veneer core product line and one composite core product line. 

1490 

1491 The following tables present the costs to mills for each type of certification scenario. The tables 

1492 are organized by each type of product and type of certification under the CARB ATCM and the TSCA 

1493 Title VI rule as follows. 

1494 

1495  Hardwood Plywood Mills: 

1496  Table 2-25, two uncertified products (i.e., not certified under the CARB ATCM) 

1497 receiving NAF certifications under the TSCA Title VI rule; 

1498  Table 2-26, two uncertified products (i.e., not certified under the CARB ATCM) 

1499 receiving NAF certifications under Option SFCC; 

1500  Table 2-27, two uncertified products under the CARB ATCM receiving standard (i.e., 

1501 Phase 2) certifications under the TSCA Title VI rule; 

1502  Table 2-28, two uncertified products under the CARB ATCM receiving standard (i.e., 

1503 Phase 2) certifications under Option SFCC;

1504  Table 2-29, two products with standard certifications under the CARB ATCM receiving 

1505 NAF certifications under the TSCA Title VI rule; 

1506  Table 2-30, two products with standard certifications under the CARB ATCM receiving 

1507 standard certifications under the TSCA Title VI rule; 

1508  Table 2-31, two products with ULEF certifications under the CARB ATCM receiving 

1509 standard certifications under the TSCA Title VI ruleoptions that eliminate the ULEF 

1510 testing exemptions and reductions; 

1511  Table 2-32, one product with ULEF certification under the CARB ATCM receiving NAF 

1512 certification under the TSCA Title VI ruleoptions that require NAF certification, and a 

1513 second product with NAF certification under the CARB ATCM receiving NAF 

1514 certification under the TSCA Title VI rule.options that require NAF certification; and

1515  Table 2-33, one product with ULEF certification and one product with NAF certification 

1516 under the CARB ATCM both receiving standard certifications under the TSCA Title VI 

1517 rule; and

1518  , two products with ULEF certifications under the CARB ATCM rule receiving NAF 

1519 certifications under the TSCA Title VI ruleoptions that require NAF certification. 

 17 A wood veneer laminated product is defined for this analysis as hardwood plywood where the producer glues a wood 

veneer to the face and/or back of a purchased platform to produce a finished product or component part (other than a 

stock hardwood plywood panel). 
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May 1, 2013 2-48

1520  Particleboard and MDF: 

1521  Table 2-34, one uncertified product under the CARB ATCM receiving standard 

1522 certification under the TSCA Title VI rule, and one product with standard certification 

1523 receiving standard certification under the TSCA Title VI rule; 

1524  Table 2-35, two products with ULEF certification under the CARB ATCM receiving 

1525 standard certifications under the TSCA Title VI rule;

1526  , one product with options that eliminate the ULEF certificationtesting exemptions and a 

1527 second product with NAF certification both receiving standard certifications under the 

1528 TSCA Title VI rulereductions; 

1529  Table 2-36, one uncertified product and a second product with standard certification both 

1530 receiving NAF certifications under the CARB ATCMoptions that require NAF 

1531 certification; 

1532  Table 2-37, two products with ULEF certifications under the CARB ATCM receiving 

1533 NAF certifications under the TSCA Title VI ruleoptions that require NAF certification; 

1534  Table 2-38, two products with standard certifications under the CARB ATCM receiving 

1535 NAF certifications under the TCA Title VI ruleoptions that require NAF certification; 

1536  Table 2-39, one product with ULEF certification and a second product with NAF 

1537 certification under the CARB ATCM both receiving NAF certification under the TSCA 

1538 Title VI ruleoptions that require NAF certification; and 

1539  Table 2-40, one product with standard certification and a second product with NAF 

1540 certification under the CARB ATCM both receiving NAF certification under the TSCA 

1541 Title VI ruleoptions that require NAF certification. 

1542  Wood Veneer Laminated Product Producers: 

1543  Table 2-41, one product not certified under the CARB ATCM receiving standard 

1544 certification under the TSCA Title VI rule; 

1545  Table 2-42, two products not certified under the CARB ATCM receiving standard 

1546 certifications under the TSCA Title VI rule; 

1547  Table 2-43, one product not certified under the CARB ATCM receiving NAF 

1548 certification under the TSCA Title VI rule; and 

1549  Table 2-44, two products not certified under the CARB ATCM receiving NAF 

1550 certifications under the TSCA Title VI rule. 

1551 

1552 The cost estimates presented in the tables represent the actual costs incurred by a mill in the first 

1553 year of a product’s certification and each subsequent year, thereafter. However, mills that have existing 

1554 CARB-certified products will already be incurring some of these costs in the baseline. Therefore, the 

1555 incremental testing and certification costs of complying with TSCA Title VI requirements will be lower 

1556 for these mills. Table 2-45 presents the summary of incremental costs (actual costs minus baseline costs) 

1557 for obtaining certification by product type, number of product lines, and baseline certification status. 
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1558 

1559 

Table 2-25: Annual Testing and Certification Costs for Hardwood Plywood Millsa

Existing Certification(s): Two Uncertified Products 

New Certification(s): Two NAF Products 

Cost Category Unit Cost Number of Units 

Repetitions for 

Product Types Total Cost 

First Year 

Initial Certification Fee $6,000 1 fee 1 $6,000 

Qualifying Test $480 5 tests 2 $4,800 

Equivalence Test $71.36 10 hours 2 $1,427 

Qualifying Test Shipping $200 1 test 2 $400 

TPC Audit $450 2 audits 1 $900 

TPC Audit Travel $1,500 1 audits 1 $1,500 

TPC Testing $480 1 test 2 $960 

TPC Testing Shipping $50 1 shipment 2 $100 

Small Chamber Testing Unit $10,000 1 unit 1 $10,000 

Desk Audit $250 2 audits 1 $500 

Mill Laborb $71.36 185 hours 1 $13,202 

Lost Productc $15.68 71 panels 2 $2,227 

First Year Total $42,015 

Subsequent Years

Re-certification Fee $3,700 1 fee 1 $3,700 

TPC Audit $450 1 audit 1 $450 

TPC Audit Travel $1,500 1 audit 1 $1,500 

TPC Testing $480 1 test 2 $960 

TPC Testing Shipping $50 1 shipment 2 $100 

Mill Labord $71.36 4.5 hours 1 $321 

Lost Producte $15.68 1 panel 2 $31 

Subsequent Year Total $7,062 

a.a. Under options other than SFCC, hardwood plywood mills are assumed to perform their own daily testing to avoid having to 

wait for weekly test results to be completed before shipping tested lots. Under Option SFCC panels can be shipped before test

results are available and therefore hardwood plywood mills are assumed to have the TPC perform the quality control testing on a

weekly basis under option SFCC. NAF certification can be achieved based on testing results from one quarterly TPC test (using 

large or small chamber test) and 3 months (i.e., 13 weeks) of routine quality control testing. Testing frequencies are those required 

by the TPC and may be more frequent than TSCA Title VI requires. 

b. 8 hours for the initial audit, 4 hours for a TPC routine audit, 0.5 hours each to prepare shipping for the qualifying test, and the 

subsequent TPC test (1 hour total), 40 hours for developing the quality control systems, 4 hours for the second audit, 1 hour per 

desk audit for 2 months,audits (2 hours total), and 2 hours a day to test samples for 13 weeks of quality control testing. (130 hours 

total).

c. 5 panels for qualifying testing, 1 panel a day for 13 weeks of quality control testing, and 1 panel for the second large chamber 

TPC test. 

d. 4 hours for the on-site audit and 0.5 hours to ship samples. 

e. 1 panel for annual large chamber TPC testing. 

Sources: U.S. Bureau of Labor Statistics 2010b, Personal Communication with CPA 2011, Personal 

Communication with HPVA 2011b, RISI 2011cSources: BLS, 2010; Communications with CPA and HPVA, 2011; 

RISI, 2010..

1560 

1561 
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1562 

Table 2-26: Annual Testing and Certification Costs for Hardwood Plywood Mills under 

Option SFCCa

Existing Certification(s): Two Uncertified Products 

New Certification(s): Two StandardNAF Products 

Cost Category Unit Cost Number of Units

Repetitions for 

Product Types Total Cost

First Year

Initial Certification Fee $6,000 1 fee 1 $6,000

Qualifying Test $480 5 tests 2 $4,800

Equivalence Test $154.00 10 hours 2 $3,080

Qualifying Test Shipping $200 1 test 2 $400

TPC Audit $450 2 audits 1 $900

TPC Audit Travel $1,500 1 audits 1 $1,500

TPC Testing $480 1 test 2 $960

TPC Testing Shipping $50 1 shipment 2 $100

Weekly QC Testing (at TPC) $154 26 Tests 2 $8,008

Weekly QC Testing Shipping $50 13 shipments 2 $1,300

Desk Audit $250 2 audits 1 $500

Mill Laborb $71.36 74.5 hours 1 $5,316

Lost Productc $15.68 19 panels 2 $596

First Year Total $33,460

Subsequent Years

Re-certification Fee $3,700 1 fee 1 $3,700

TPC Audit $450 1 audit 1 $450

TPC Audit Travel $1,500 1 audit 1 $1,500

TPC Testing $480 1 test 2 $960

TPC Testing Shipping $50 1 shipment 2 $100

Mill Labord $71.36 4.5 hours 1 $321

Lost Producte $15.68 1 panel 2 $31

Subsequent Year Total $7,062

a. Under Option SFCC panels can be shipped before test results are available. Therefore, hardwood plywood mills are assumed to

have the TPC perform the quality control testing on a weekly basis. Under the other options, hardwood plywood mills are 

assumed to perform their own daily testing to avoid having to wait for weekly test results to be completed before shipping tested 

lots. NAF certification can be achieved based on testing results from one quarterly TPC test (using large or small chamber test) 

and 3 months (i.e., 13 weeks) of routine quality control testing. Testing frequencies are those required by the TPC and may be

more frequent than TSCA Title VI requires.

b. 8 hours for the initial audit, 4 hours for a TPC routine audit, 0.5 hours each to prepare shipping for the qualifying test and the 

subsequent TPC test (1 hour total), 40 hours for developing the quality control systems, 1 hour per desk audit for 2 audits (2 hours 

total), and 1.5 hours a week for 13 weeks of quality control testing (74.5 hours total).

c. 5 panels for qualifying testing, 1 panel a week for 13 weeks of quality control testing, and 1 panel for the second large chamber 

TPC test.

d. 4 hours for the on-site audit and 0.5 hours to ship samples.

e. 1 panel for annual large chamber TPC testing.

Sources: U.S. Bureau of Labor Statistics 2010b, Personal Communication with CPA 2011, Personal 

Communication with HPVA 2011b, RISI 2011c.

1563 

1564 

Formatted Table
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1565 

Table 2-27: Annual Testing and Certification Costs for Hardwood Plywood Millsa

Existing Certification(s): Two Uncertified Products

New Certification(s): Two Standard Products

Cost Category Unit Cost Number of Units 

Repetitions for 

Product Types Total Cost 

First Year 

Initial Certification Fee $6,000 1 fee 1 $6,000 

Qualifying Test $480 5 tests 2 $4,800 

Equivalence Test $71.36 10 hours 2 $1,427 

Qualifying Test Shipping $200 1 shipment 2 $400 

TPC Audit $450 4 audits 1 $1,800 

TPC Audit Travel $1,500 1 audit 1 $1,500 

TPC Testing $480 3 tests 2 $2,880 

TPC Testing Shipping $50 3 shipments 2 $300 

Small Chamber Testing Unit $10,000 1 unit 1 $10,000 

Desk Audit $250 8 audits 1 $2,000 

Mill LaboraLaborb $71.36 590 hours 1 $42,102 

Lost ProductbProductc $15.68 268 panels 2 $8,404 

First Year Total $81,614 

Subsequent Years

Re-certification Fee $6,000 1 fee 1 $6,000 

TPC Audit $450 4 audits 1 $1,800 

TPC Audit Travel $1,500 1 audit 1 $1,500 

TPC Testing $480 4 tests 2 $3,840 

TPC Testing Shipping $50 4 shipments 2 $400 

Desk Audit $250 8 audits 1 $2,000 

Mill LaborcLabord $71.36 546 hours 1 $38,963 

Lost ProductdProducte $15.68 264 panels 2 $8,279 

Subsequent Year Total $62,782 

aa. Under options other than SFCC, hardwood plywood mills are assumed to perform their own daily testing to avoid having 

to wait for weekly test results to be completed before shipping tested lots. Under Option SFCC panels can be shipped before 

test results are available and therefore hardwood plywood mills are assumed to have the TPC perform the quality control 

testing on a weekly basis under option SFCC. 

b. 8 hours for the initial audit, 4 hours each for 3 routine TPC audits (12 hours total), 0.5 hours each to prepare shipping for 

the qualifying test, and the 3 other TPC tests (2 hours total), 40 hours for developing the quality control systems, 4 hours for 

other quarterly audits, 1 hour per monthly desk audit for the other 8 months, (8 hours total), and 2 hours a day to test samples 

for 52 weeks of quality control testing. (520 hours total).

bc. 5 panels for qualifying testing, 1 panel a day for 52 weeks of quality control testing, and 1 panel for each quarterly large 

chamber TPC test. (excluding the first quarter in year 1).

cd. 4 hours each for other quarterly routine TPC audits, (16 hours total), 0.5 hours each to prepare for shipping the quarterly 

TPC tests (2 hours total), 1 hour per desk audit for the other 8 months, (8 hours total), and 2 hours a day to test samples for 52 

weeks of quality control testing. (520 hours total).

de. 1 panel a day for 52 weeks of quality control testing, and 1 panel for each quarterly large chamber TPC test. 

Sources: U.S. Bureau of Labor Statistics 2010b, Personal Communication with CPA 2011, Personal 

Communication with HPVA 2011b, RISI 2011cBLS, 2010; Communications with CPA and HPVA, 2011; RISI, 

2010..

1566 

1567 
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1568 

Table 2-28: Annual Testing and Certification Costs for Hardwood Plywood Mills

Under Option SFCCa

Existing Certification(s): Two StandardUncertified Products 

– New Certification(s): Two Standard Products 

Cost Category Unit Cost Number of Units

Repetitions for 

Product Types Total Cost

First Year

Initial Certification Fee $6,000 1 fee 1 $6,000

Qualifying Test $480 5 tests 2 $4,800

Equivalence Test $154 10 hours 2 $3,080

Qualifying Test Shipping $200 1 shipment 2 $400

TPC Audit $450 4 audits 1 $1,800

TPC Audit Travel $1,500 1 audit 1 $1,500

TPC Testing $480 3 tests 2 $2,880

TPC Testing Shipping $50 3 shipments 2 $300

Weekly QC Testing (at TPC) $154 104 tests 2 $32,032

Weekly QC Testing Shipping $50 52 shipments 2 $5,200

Desk Audit $250 8 audits 1 $2,000

Mill Labor $71.36 148 hours 1 $10,561

Lost Productc $15.68 60 panels 2 $1,882

First Year Total $72,435

Subsequent Years

Re-certification Fee $6,000 1 fee 1 $6,000

TPC Audit $450 4 audits 1 $1,800

TPC Audit Travel $1,500 1 audit 1 $1,500

TPC Testing $480 4 tests 2 $3,840

TPC Testing Shipping $50 4 shipments 2 $400

Weekly QC Testing (at TPC) $154 104 tests 2 $32,032

Weekly QC Testing Shipping $50 52 shipments 2 $5,200

Desk Audit $250 8 audits 1 $2,000

Mill Labord $71.36 104 hours 1 $7,421

Lost Producte $15.68 56 panels 2 $1,756

Subsequent Year Total $61,950

Formatted Table
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1569 

Cost 

Category

Unit 

Cost

Number 

of Units

Repetition

s for 

Product 

Types

Total 

Cost to 

Certify 

Product 

Line(s)

a. Under Option SFCC panels can be shipped 

before test results are available. Therefore, 

hardwood plywood mills are assumed to 

have the TPC perform the quality control 

testing on a weekly basis. Under the other 

options, hardwood plywood mills are 

assumed to perform their own daily testing to 

avoid having to wait for weekly test results to 

be completed before shipping tested lots. 

b. 8 hours for the initial audit, 4 hours each 

for 3 routine TPC audits (12 hours total), 0.5 

hours each to prepare shipping for the 

qualifying test and the 3 other TPC tests (2 

hours total), 40 hours for developing the 

quality control systems, 1 hour per monthly 

desk audit for 8 months (8 hours total), and 

1.5 hours a week to for quality control testing 

(78 hours total).

c. 5 panels for qualifying testing, 1 panel a 

week for 52 weeks of quality control testing, 

and 1 panel for each quarterly large chamber 

TPC test (excluding the first quarter in year 

1).

d. 4 hours each for quarterly routine TPC 

audits (16 hours total), 0.5 hours each to 

prepare for shipping the quarterly TPC tests 

(2 hours total), 1 hour per desk audit for 8 

months (8 hours total), and 1.5 hours a week 

to for quality control testing (78 hours total).

e. 1 panel a week for 52 weeks of quality 

control testing, and 1 panel for each quarterly 

large chamber TPC test. 

Sources: U.S. Bureau of Labor 

Statistics 2010b, Personal 

Communication with CPA 2011, 

Personal Communication with HPVA 

2011b, RISI 2011cCost Incurred in 

Baseline for Existing Certification(s).

Increment

al Cost to 

Certify 

Product 

Line(s)

Deleted Cells

Formatted Table

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells
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1570 

Table 2-29: Annual Testing and Certification Costs for Hardwood Plywood MillsExisting Certification(s): Two Standard Products – New Certification(s): Two Standard Products a

Cost Category Unit Cost Number of Units

Repetitions for 

Product Types

Total Cost to Certify

Product Line(s)

Cost Incurred in 

Baseline for Existing

Certification(s)

Incremental Cost to 

Certify Product Line(s)

First Year 

Initial Certification Fee $6,000 1 fee 1 $6,000 $6,000 $0 Qualifying Test $480 0 tests 2 $0 $0 $0 Correlation Test $71.36 0 tests 2 $0 $0 $0 Qualifying Test Shipping $200 0 shipment 2 $0 $0 $0 TPC Audit $450 4 audits 1 $1,800 $1,800 $0 TPC Audit Travel $1,500 1 audit 1 $1,500 $1,500 $0 TPC Testing $480 4 test 2 $3,840 $3,840 $0 TPC Testing Shipping $50 4 shipment 2 $400 $400 $0 Weekly QC Testing $154 0 tests 2 $0 $32,032 ($32,032) Weekly QC Testing Shipping $50 0 shipments 2 $0 $5,200 ($5,200) Small Chamber Testing Unit $10,000 1 unit 1 $10,000 $0 $10,000 Desk Audit $250 8 audits 1 $2,000 $2,000 $0 Mill LaboraLaborb $71.36 546 hours 1 $38,963 $7,421 $31,541 Lost ProductbProductc $15.68 264 panels 2 $8,279 $1,756 $6,523 First Year Total $72,782 $61,950 $10,832 

Subsequent Years 

Re-certification Fee $6,000 1 fee 1 $6,000 $6,000 $0 TPC Audit $450 4 audit 1 $1,800 $1,800 $0 TPC Audit Travel $1,500 1 audit 1 $1,500 $1,500 $0 TPC Testing $480 4 test 2 $3,840 $3,840 $0 TPC Testing Shipping $50 4 shipment 2 $400 $400 $0 Weekly QC Testing $154 0 tests 2 $0 $32,032 ($32,032) Weekly QC Testing Shipping $50 0 shipments 2 $0 $5,200 ($5,200) Desk Audit $250 8 audits 1 $2,000 $2,000 $0 Mill LaboraLaborb $71.36 546 hours 1 $38,963 $7,421 $31,541 Lost ProductbProductc $15.68 264 panel 2 $8,279 $1,756 $6,523 Subsequent Year Total $62,782 $61,950 $832 a. These estimates apply to the options that require mills to hold tested lots until the results are available (all options other than Option SFCC). Mills without a small chamber unit are assumed to comply with this requirement by purchasing test chambers and conducting daily on-site QC testing, resulting in the incremental costs presented here. There are no incremental costs for this certification under Option SFCC.b. 4 hours each for other quarterly routine TPC audits, (16 hours total), 0.5 hours each to prepare for shipping the quarterly TPC tests (2 hours total), 1 hour per desk audit for the other 8 months, (8 hours total), and 2 hours a day to test samples for 52 weeks of quality control testing. (520 hours total).bc. 1 panel a day for 52 weeks of quality control testing, and 1 panel for each quarterly large chamber TPC test. Sources: U.S. Bureau of Labor Statistics 2010b, Personal Communication with CPA 2011, Personal Communication with HPVA 2011b, RISI 2011cBLS, 2010; Communications with CPA and HPVA, 2011; RISI, 2010..
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Table 2-30: Annual Testing and Certification Costs for Hardwood Plywood MillsaExisting Certification(s): Two Standard Products – New Certification(s): Two NAF Products 

Cost Category Unit Cost Number of Units 

Repetitions for 

Product Types 

Total Cost to Certify

Product Line(s) 

Cost Incurred in 

Baseline for Existing

Certification(s) 

Incremental Cost to 

Certify Product Line(s)

First Year 

Initial Certification Fee $6,000 1 fee 1 $6,000 $6,000 $0 Qualifying Test $480 5 tests 2 $4,800 $0 $4,800 Correlation Test $71.36 10 tests 2 $1,427 $0 $1,427 Qualifying Test Shipping $200 1 shipment 2 $400 $0 $400 TPC Audit $450 2 audits 1 $900 $1,800 ($900) TPC Audit Travel $1,500 1 audit 1 $1,500 $1,500 $0 TPC Testing $480 1 test 2 $960 $3,840 ($2,880) TPC Testing Shipping $50 1 shipment 2 $100 $400 ($300) Weekly QC Testing $154 0 tests 2 $0 $32,032 ($32,032) Weekly QC Testing Shipping $50 0 shipments 2 $0 $5,200 ($5,200) Small Chamber Testing Unit $10,000 1 unit 1 $10,000 $0 $10,000 Desk Audit $250 2 audits 1 $500 $2,000 ($1,500) Mill Laborb $71.36 141 hours 1 $10,062 $7,421 $2,640 Lost Productc $15.68 71 panels 2 $2,227 $1,756 $470 First Year Total $38,876 $61,950 ($23,074) 

Subsequent Years 

Re-certification Fee $3,700 1 fee 1 $3,700 $6,000 ($2,300) TPC Audit $450 1 audit 1 $450 $1,800 ($1,350) TPC Audit Travel $1,500 1 audit 1 $1,500 $1,500 $0 TPC Testing $480 1 test 2 $960 $3,840 ($2,880) TPC Testing Shipping $50 1 shipment 2 $100 $400 ($300) Weekly QC Testing $154 0 tests 2 $0 $32,032 ($32,032) Weekly QC Testing Shipping $50 0 shipments 2 $0 $5,200 ($5,200) Desk Audit $250 0 audits 1 $0 $2,000 ($2,000) Mill Labord $71.36 4.5 hours 1 $321 $7,421 ($7,100) Lost Producte $15.68 1 panel 2 $31 $1,756 ($1,725) Subsequent Year Total $7,062 $61,950 ($54,887) a. NAF certification can be achieved based on testing results from one quarterly test (using a primary or secondary test method) and 3 months (i.e., 13 weeks) of routine small scale testing. Testing frequencies are those required by the TPC and may be more frequent than TSCA Title VI requires.b. 4 hours for the initial and second audit, 0.5 hours to prepare shipping for the qualifying test and second audit, 1 hour per desk audit for 2 months for NAF products, and 2 hours a day to testsamples for 13 weeks of quality control testing. c. 5 panels for qualifying testing, 1 panel a day for 13 weeks of small scale testing, and 1 panel for the second large scale test.d. 4 hours for the on-site audit and 0.5 hours to ship samples.e. 1 panel for annual large scale testing.Sources: BLS, 2010; Communications with CPA and HPVA, 2011; RISI, 2010.
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

January 27, 2012 2-56

Table 2-27: Annual Testing and Certification Costs for Hardwood Plywood Mills Existing Certification(s): Two ULEF Products 

– New Certification(s): Two Standard Products

Cost Category Unit Cost Number of Units

Repetitions for 

Product Types

Total Cost to Certify

Additional Product 

Line(s)

Cost Incurred in 

Baseline for Existing 

Certification(s)

Incremental Cost to 

Certify Additional 

Product Line(s)

1571 

a. NAF certification can be achieved based on testing results from one quarterly test (using a primary or secondary test method) and 3 months (i.e., 13 weeks) of routine small scale testing. Testing frequencies are those required by the TPC and may be more frequent than TSCA Title VI requires.b. 4 hours each for the initial audit and second routine TPC audit (8 hours total), 0.5 hours each to prepare shipping for the qualifying test and second audit (1 hour total), 1 hour per desk audit for 2 months for NAF products (2 hours total), and 2 hours a day to test samples for 13 weeks of quality control testing (130 hours total). c. 5 panels for qualifying testing, 1 panel a day for 13 weeks of small scale testing, and 1 panel for the second large scale test.d. 4 hours for the on-site audit and 0.5 hours to ship samples.e. 1 panel for annual large scale testing.Sources: U.S. Bureau of Labor Statistics 2010b, Personal Communication with CPA 2011, Personal Communication with HPVA 2011b, RISI 2011c.

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

January 27, 2012 2-57

Table 2-31: Annual Testing and Certification Costs for Hardwood Plywood Mills Existing Certification(s): Two ULEF Products – New Certification(s): Two Standard Products

Cost Category Unit Cost Number of Units

Repetitions for 

Product Types

Total Cost to Certify 

Additional Product 

Line(s)

Cost Incurred in 

Baseline for Existing 

Certification(s)

Incremental Cost to 

Certify Additional 

Product Line(s)

First Year 

Initial Certification Fee $6,000 1 fee 1 $6,000 $3,700 $2,300 Qualifying Test $480 0 tests 2 $0 $0 $0 Correlation Test $71.36 0 tests 2 $0 $0 $0 Qualifying Test Shipping $200 0 shipments 2 $0 $0 $0 TPC Audit $450 4 audits 1 $1,800 $450 $1,350 TPC Audit Travel $1,500 1 audit 1 $1,500 $1,500 $0 TPC Testing $480 4 tests 2 $3,840 $3,840 $0 TPC Testing Shipping $50 4 shipments 2 $400 $400 $0 Small Chamber Testing Unit $10,000 1 unit 1 $10,000 $0 $10,000 Desk Audit $250 8 audits 1 $2,000 $0 $2,000 Mill Labora $71.36 546 hours 1 $38,963 $642 $38,320 Lost Productb $15.68 264 panels 2 $8,279 $125 $8,154 First Year Total $72,782 $10,658 $62,124 

Subsequent Years 

Re-certification Fee $6,000 1 fee 1 $6,000 $3,700 $2,300 TPC Audit $450 4 audits 1 $1,800 $450 $1,350 TPC Audit Travel $1,500 1 audit 1 $1,500 $1,500 $0 TPC Testing $480 4 tests 2 $3,840 $3,840 $0 TPC Testing Shipping $50 4 shipments 2 $400 $400 $0 Desk Audit $250 8 audits 1 $2,000 $0 $2,000 Mill Labora $71.36 546 hours 1 $38,963 $642 $38,320 Lost Productb $15.68 264 panels 2 $8,279 $125 $8,154 Subsequent Year Total $62,782 $10,658 $52,124 a. 4 hours each for other quarterly routine TPC audits, (16 hours total), 0.5 hours each to prepare for shipping, the quarterly TPC tests (2 hours total), 1 hour per desk audit for the other 8 months, (8 hours total), and 2 hours a day to test samples for 52 weeks of quality control testing. (520 hours total). b. 1 panel a day for 52 weeks of small scale testing, and 1 panel for each quarterly large scale test. Sources: U.S. Bureau of Labor Statistics 2010b, Personal Communication with CPA 2011, Personal Communication with HPVA 2011b, RISI 2011cSources: BLS, 2010; Communications with CPA and HPVA, 2011; RISI, 2010..

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Table 2-32: Annual Testing and Certification Costs for Hardwood Plywood MillsaExisting Certification(s): One ULEF Product and One NAF Product – New Certification(s): Two NAF Products 

Cost Category Unit Cost Number of Units 

Repetitions for 

Product Types 

Total Cost to Certify

Product Line(s) 

Cost Incurred in 

Baseline for Existing 

Certification(s) 

Incremental Cost to 

Certify Product Line(s)

First Year 

Initial Certification Fee $3,700 1 fee 1 $3,700 $3,700 $0 Qualifying Test $480 5 tests 1 $2,400 $0 $2,400 Correlation Test $71.36 10 tests 1 $714 $0 $714 Qualifying Test Shipping $200 1 shipment 1 $200 $0 $200 TPC Audit $450 2 audits 1 $900 $450 $450 TPC Audit Travel $1,500 1 audit 1 $1,500 $1,500 $0 TPC Testing $480 1 test 12 $480960 $1,9202,400 ($1,440) TPC Testing Shipping $50 1 shipment 12 $50100 $200250 ($150) Small Chamber Testing Unit $10,000 1 unit 1 $10,000 $6420 $9,35810,000Desk Audit $250 2 audits 1 $500 $0 $500 Mill Laborb $71.36 141 hours 1 $10,062 $642 $9,420 Lost Productc $15.68 71 panels 1 $1,113 $6378 $1,051035First Year Total $31,61932,149 $9,117021 $22,50123,128

Subsequent Years 

Re-certification Fee $3,700 1 fee 1 $3,700 $3,700 $0 TPC Audit $450 1 audit 1 $450 $450 $0 TPC Audit Travel $1,500 1 audit 1 $1,500 $1,500 $0 TPC Testing $480 1 test 12 $480960 $1,9202,400 ($1,440) TPC Testing Shipping $50 1 shipment 12 $50100 $200250 ($150) Mill Labord $71.36 4.5 hours 1 $321 $642 ($321) Lost Producte $15.68 1 panel 1 $16 $6378 ($4763) Subsequent Year Total $6,5177,047 $8,4759,021 ($1,958974) a. NAF certification can be achieved based on testing results from one quarterly test (using a primary or secondary test method) and 3 months (i.e., 13 weeks) of routine small scale testing. Testing frequencies are those required by the TPC and may be more frequent than TSCA Title VI requires. b. 4 hours each for the initial audit and second routine TPC audit, (8 hours total), 0.5 hours each to prepare shipping for the qualifying test and second audit, (1 hour total), 1 hour per desk audit for 2 months for NAF products, (2 hours total), and 2 hours a day to test samples for 13 weeks of quality control testing. (130 hours total).c. 5 panels for qualifying testing, 1 panel a day for 13 weeks of small scale testing, and 1 panel for the second large scale test. d. 4 hours for the on-site audit and 0.5 hours to ship samples. e. 1 panel for annual large scale testing. Sources: U.S. Bureau of Labor Statistics 2010b, Personal Communication with CPA 2011, Personal Communication with HPVA 2011b, RISI 2011cSources: BLS, 2010; Communications with CPA and HPVA, 2011; RISI, 2010..

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

January 27, 2012 2-59

Table 2-33: Annual Testing and Certification Costs for Hardwood Plywood Mills MillsaExisting Certification(s): OneTwo ULEF Product and One NAF ProductProducts – New Certification(s): Two 

StandardNAF Products 

Cost Category Unit Cost Number of Units

Repetitions for 

Product Types

Total Cost to Certify

Product Line(s)

Cost Incurred in 

Baseline for Existing 

Certification(s)

Incremental Cost to 

Certify Product Line(s)

First Year

Initial Certification Fee $6,000 1 fee 1 $6,000 $3,700 $2,300 Qualifying Test $480 0 tests 2 $0 $0 $0 Correlation Test $71.36 0 tests 2 $0 $0 $0 Qualifying Test Shipping $200 0 shipments 2 $0 $0 $0 TPC Audit $450 4 audits 1 $1,800 $450 $1,350 TPC Audit Travel $1,500 1 audit 1 $1,500 $1,500 $0 TPC Testing $480 4 tests 2 $3,840 $2,400 $1,440 TPC Testing Shipping $50 4 shipments 2 $400 $250 $150 Small Chamber Testing Unit $10,000 1 unit 1 $10,000 $78 $9,922 Desk Audit $250 8 audits 1 $2,000 $0 $2,000 Mill Labora $71.36 546 hours 1 $38,963 $642 $38,320 Lost Productb $15.68 264 panels 2 $8,279 $78 $8,201 First Year Total $72,782 $9,099 $63,683 

Subsequent Years

Re-certification Fee $6,000 1 fees 1 $6,000 $3,700 $2,300 TPC Audit $450 4 audits 1 $1,800 $450 $1,350 TPC Audit Travel $1,500 1 audit 1 $1,500 $1,500 $0 TPC Testing $480 4 tests 2 $3,840 $2,400 $1,440 TPC Testing Shipping $50 4 shipments 2 $400 $250 $150 Desk Audit $250 8 audits 1 $2,000 $0 $2,000 Mill Labora $71.36 546 hours 1 $38,963 $642 $38,320 Lost Productb $15.68 264 panels 2 $8,279 $78 $8,201 Subsequent Year Total $62,782 $9,021 $53,761 a. 4 hours for other quarterly audits, 0.5 to prepare shipping, 1 hour per desk audit for the other 8 months, and 2 hours a day to test samples for 52 weeks of quality control testing.b. 1 panel a week for 52 weeks of small scale testing, and 1 panel for each quarterly large scale test.Sources: BLS, 2010; Communications with CPA and HPVA, 2011; RISI, 2010.

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May 1, 2013 2-60 

Table 2-30: Annual Testing and Certification Costs for Hardwood Plywood MillsaExisting Certification(s): Two ULEF Products 

– New Certification(s): Two NAF Products

Cost Category Unit Cost Number of Units 

Repetitions for 

Product Types 

Total Cost to Certify

Product Line(s) 

Cost Incurred in 

Baseline for Existing 

Certification(s) 

Incremental Cost to 

Certify Product Line(s)

First Year 

Initial Certification Fee $3,700 1 fee 1 $3,700 $3,700 $0 Qualifying Test $480 5 tests 2 $4,800 $0 $4,800 Correlation Test $71.36 10 tests 2 $1,427 $0 $1,427 Qualifying Test Shipping $200 1 shipment 2 $400 $0 $400 TPC Audit $450 2 audits 1 $900 $450 $450 TPC Audit Travel $1,500 1 audit 1 $1,500 $1,500 $0 TPC Testing $480 1 test 2 $960 $3,840 ($2,880) TPC Testing Shipping $50 1 shipment 2 $100 $400 ($300) Small Chamber Testing Unit $10,000 1 unit 1 $10,000 $2,0000 $810,000 Desk Audit $250 2 audits 1 $500 $0 $500 Mill Laborb $71.36 141 hours 1 $10,062 $642 $9,420 Lost Productc $15.68 71 panels 2 $2,227 $125 $2,101 First Year Total $36,576 $1210,658 $2325,918 

Subsequent Years 

Re-certification Fee $3,700 1 fee 1 $3,700 $3,700 $0 TPC Audit $450 1 audit 1 $450 $450 $0 TPC Audit Travel $1,500 1 audit 1 $1,500 $1,500 $0 TPC Testing $480 1 test 2 $960 $3,840 ($2,880) TPC Testing Shipping $50 1 shipment 2 $100 $400 ($300) Mill Labord $71.36 4.5 hours 1 $321 $642 ($321) Lost Producte $15.68 1 panel 2 $31 $125 ($94) Subsequent Year Total $7,062 $10,658 ($3,595) a. NAF certification can be achieved based on testing results from one quarterly test (using a primary or secondary test method) and 3 months (i.e., 13 weeks) of routine small scale testing. Testing frequencies are those required by the TPC and may be more frequent than TSCA Title VI requires. b. 4 hours each for the initial audit and second routine TPC audit, (8 hours total), 0.5 hours each to prepare shipping for the qualifying test and second audit, (1 hour total), 1 hour per desk audit for 2 months for NAF products, (2 hours total), and 2 hours a day to test samples for 13 weeks of quality control testing. (130 hours total).c. 5 panels for qualifying testing, 1 panel a day for 13 weeks of small scale testing, and 1 panel for the second large scale test. d. 4 hours for the on-site audit and 0.5 hours to ship samples. e. 1 panel for annual large scale testing. Sources: U.S. Bureau of Labor Statistics 2010b, Personal Communication with CPA 2011, Personal Communication with HPVA 2011b, RISI 2011cSources: BLS, 2010; Communications with CPA and HPVA, 2011; RISI, 2010..

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1578 

Table 2-34: Annual Testing and Certification Costs for Particleboard/MDF Mills Existing Certification(s): One Uncertified Product and One Standard Product – New Certification(s): Two Standard Products 

Cost Category Unit Cost Number of Units 

Repetitions for 

Product Types 

Total Cost to Certify

Additional Product 

Line(s) 

Cost Incurred in 

Baseline for Existing 

Certification(s) 

Incremental Cost to 

Certify Additional 

Product Line(s) 

First Year 

Initial Certification Fee $6,000 1 fee 1 $6,000 $6,000 $0 Qualifying Test $480 5 tests 1 $2,400 $0 $2,400 Correlation Test $71.36 10 hours 1 $714 $0 $714 Qualifying Test Shipping $200 1 shipments 1 $200 $0 $200 TPC Audit $450 4 audits 1 $1,800 $1,800 $0 TPC Audit Travel $1,500 1 audit 1 $1,500 $1,500 $0 TPC Testing $480 3 tests 1 $1,440 $01,920 $1,440 ($480)TPC Testing Shipping $50 3 shipments 1 $150 $0200 $150 ($50)Small Chamber Testing Unit $10,000 0 units 1 $0 $0 $0 Desk Audit $250 8 audits 1 $2,000 $2,000 $0 Mill Labora $71.36 546 hours 1 $38,962963 $38,962963 $0 Lost Productb $8.96 268532 panels 1 $2,4014,767 $02,365 $2,401 First Year Total $57,56759,933 $50,26254,748 $7,3055,185 

Subsequent Years 

Re-certification Fee $6,000 1 fee 1 $6,000 $6,000 $0 TPC Audit $450 4 audits 1 $1,800 $1,800 $0 TPC Audit Travel $1,500 1 audit 1 $1,500 $1,500 $0 TPC Testing $480 4 tests 12 $1,9203,840 $01,920 $1,920 TPC Testing Shipping $50 4 shipments 12 $200400 $0200 $200 Desk Audit $250 8 audits 1 $2,000 $2,000 $0 Mill Laborc $71.36 546 hours 1 $38,962963 $38,962963 $0 Lost Productd $8.96 264 panels 12 $2,3654,731 $02,365 $2,365 Subsequent Year Total $54,74859,233 $50,26254,748 $4,485 a. 4 hours each for the initial audit,quarterly routine TPC audits (16 hours total), 0.5 hours each to prepare for shipping for the quarterly TPC tests, 4 (2 hours for 3 quarterly audits,total), 1 hour per desk audit for 8 months, (8 hours total), and 2 hours a day, 5 days a week, to test samples for 52 weeks of small scalequality control testing. (520 hours total). b.b. For each product line, 5 panels for qualifying testing, 1 panel each day, 5 days a week for small scale testing, and 1 panel for the quarterly large scale tests. Note that the 532 panels includes 268 for the newly certified product line and 264 for the existing certified product line.c. 4 hours each for 4 quarterly audits, (16 hours total), 0.5 hours to prepare shipping for quarterly TPC tests, (2 hours total), 1 hour per desk audit for 8 months, (8 hours total), and 2 hours a day, 5 days a week, for 52 weeks of small scale testing. (520 hours total).d. 1 panel each day, 5 days a week for small scale testing, and 1 panel for the quarterly large scale tests. Sources: U.S. Bureau of Labor Statistics 2010b, Personal Communication with CPA 2011, Personal Communication with HPVA 2011b, RISI 2011cSources: BLS, 2010; Communications with CPA and HPVA, 2011; RISI, 2010..

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1580 

Table 2-35: Annual Testing and Certification Costs for Particleboard/MDF Mills Existing Certification(s): Two ULEF Products – New Certification(s): Two Standard Products 

Cost Category Unit Cost Number of Units 

Repetitions for 

Product Types 

Total Cost to Certify

Additional Product 

Line(s) 

Cost Incurred in 

Baseline for Existing 

Certification(s) 

Incremental Cost to 

Certify Additional 

Product Line(s) 

First Year 

Initial Certification Fee $6,000 1 fee 1 $6,000 $3,700 $2,300 Qualifying Test $480 0 tests 2 $0 $0 $0 Correlation Test $71.36 0 hours 2 $0 $0 $0 Qualifying Test Shipping $200 0 shipments 2 $0 $0 $0 TPC Audit $450 4 audits 1 $1,800 $450 $1,350 TPC Audit Travel $1,500 1 audit 1 $1,500 $1,500 $0 TPC Testing $480 4 tests 2 $3,840 $3,840 $0 TPC Testing Shipping $50 4 shipments 2 $400 $400 $0 Small Chamber Testing Unit $10,000 0 units 1 $0 $0 $0 Desk Audit $250 8 audits 1 $2,000 $0 $2,000 Mill Labora $71.36 546 hours 1 $38,962963 $642 $38,320 Lost Productb $8.96 264 panels 2 $4,731 $72 $4,659 First Year Total $59,233 $10,604 $48,629 

Subsequent Years

Re-certification Fee $6,000 1 fee 1 $6,000 $3,700 $2,300 TPC Audit $450 4 audits 1 $1,800 $450 $1,350 TPC Audit Travel $1,500 1 audit 1 $1,500 $1,500 $0 TPC Testing $480 4 tests 2 $3,840 $3,840 $0 TPC Testing Shipping $50 4 shipments 2 $400 $400 $0 Desk Audit $250 8 audits 1 $2,000 $0 $2,000 Mill Labora $71.36 546 hours 1 $38,962 $642 $38,320 Lost Productb $8.96 264 panels 2 $4,731 $72 $4,659 SubsequentFirst Year Total $59,233 $10,604 $48,629630a. 4 hours for 4 quarterly audits, 0.5 hours to prepare shipping for TPC tests,1 hour per desk audit for 8 months, and 2 hours a day, 5 days a week, for 52 weeks of small scale testing.b. 1 panel each day, 5 days a week for small scale testing, and 1 panel for the quarterly large scale tests.

Sources: BLS, 2010; Communications with CPA and HPVA, 2011; RISI, 2010.Subsequent Years

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1582 

Table 2-33: Annual Testing and Certification Costs for Particleboard/MDF MillsExisting Certification(s): One NAF Product and One ULEF Product 

– New Certification(s): Two Standard Products

Cost Category Unit Cost Number of Units

Repetitions for 

Product Types

Total Cost to Certify

Additional Product 

Line(s)

Cost Incurred in 

Baseline for Existing 

Certification(s)

Incremental Cost to 

Certify Additional 

Product Line(s)

First Year

Initial Certification Fee $6,000 1 fee 1 $6,000 $3,700 $2,300 Qualifying Test $480 0 tests 2 $0 $0 $0 Correlation Test $71.36 0 hours 2 $0 $0 $0 Qualifying Test Shipping $200 0 shipments 2 $0 $0 $0 TPC Audit $450 4 audits 1 $1,800 $450 $1,350 TPC Audit Travel $1,500 1 audit 1 $1,500 $1,500 $0 TPC Testing $480 4 tests 2 $3,840 $2,400 $1,440 TPC Testing Shipping $50 4 shipments 2 $400 $250 $150 Small Chamber Testing Unit $10,000 0 units 1 $0 $0 $0 Desk Audit $250 8 audits 1 $2,000 $0 $2,000 Mill Labora $71.36 546 hours 1 $38,962 $642 $38,320 Lost Productb $8.96 264 panels 2 $4,731 $45 $4,686 First Year Total $59,233 $8,987 $50,246 

Subsequent Years

Re-certification Fee $6,000 1 fee 1 $6,000 $3,700 $2,300 TPC Audit $450 4 audits 1 $1,800 $450 $1,350 TPC Audit Travel $1,500 1 audit 1 $1,500 $1,500 $0 TPC Testing $480 4 tests 2 $3,840 $2,4003,840 $1,4400TPC Testing Shipping $50 4 shipments 2 $400 $250400 $1500Desk Audit $250 8 audits 1 $2,000 $0 $2,000 Mill Labora $71.36 546 hours 1 $38,962963 $642 $38,320 Lost Productb $8.96 264 panels 2 $4,731 $4572 $4,686659Subsequent Year Total $59,233 $8,98710,604 $50,24648,630a. 4 hours each for 4 quarterly routine TPC audits, (16 hours total), 0.5 hours each to prepare for shipping for the quarterly TPC tests, (2 hours total), 1 hour per desk audit for 8 months, (8 hours total),and 2 hours a day, 5 days a week, to test samples for 52 weeks of small scalequality control testing. (520 hours total). b. 1 panel each day, 5 days a week for small scale testing, and 1 panel for the quarterly large scale tests. Sources: U.S. Bureau of Labor Statistics 2010b, Personal Communication with CPA 2011, Personal Communication with HPVA 2011b, RISI 2011cSources: BLS, 2010; Communications with CPA and HPVA, 2011; RISI, 2010..

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Table 2-36: Annual Testing and Certification Costs for Particleboard/MDF MillsaExisting Certification(s): One Uncertified Product and One Standard Product – New Certification(s): Two NAF Products 

Cost Category Unit Cost Number of Units 

Repetitions for 

Product Types 

Total Cost to Certify

Additional Product 

Line(s) 

Cost Incurred in 

Baseline for Existing 

Certification(s) 

Incremental Cost to 

Certify Additional 

Product Line(s) 

First Year 

Initial Certification Fee $6,000 1 fee 1 $6,000 $6,000 $0 Qualifying Test $480 5 tests 2 $4,800 $0 $4,800 Correlation Test $71.36 10 hours 2 $1,427 $0 $1,427 Qualifying Test Shipping $200 1 shipment 2 $400 $0 $400 TPC Audit $450 2 audits 1 $900 $1,800 ($900) TPC Audit Travel $1,500 1 audit 1 $1,500 $1,500 $0 TPC Testing $480 1 test 2 $960 $1,920 ($960) TPC Testing Shipping $50 1 shipment 2 $100 $200 ($100) Small Chamber Testing Unitb $10,000 0 units 1 $0 $0 $0 Desk Audit $250 2 audits 1 $500 $2,000 ($1,500) Mill Laborc $71.36 141 hours 1 $10,062 $38,962963 ($28,900901) Lost Productd $8.96 71 panels 2 $1,272 $2,365 ($1,093) First Year Total $27,921 $54,748 ($26,826827) 

Subsequent Years 

Re-certification Fee $3,700 1 fee 1 $3,700 $6,000 ($2,300) TPC Audit $450 1 audit 1 $450 $1,800 ($1,350) TPC Audit Travel $1,500 1 audit 1 $1,500 $1,500 $0 TPC Testing $480 1 test 2 $960 $1,920 ($960) TPC Testing Shipping $50 1 shipment 2 $100 $200 ($100) Desk Audit $250 0 audits 1 $0 $2,000 ($2,000) Mill Labore $71.36 4.5 hours 1 $321 $38,962963 ($38,641) Lost Productf $8.96 1 panel 2 $18 $2,365 ($2,348) Subsequent Year Total $7,049 $54,748 ($47,699) a. NAF certification can be achieved based on testing results from one quarterly test (using a primary or secondary test method) and 3 months (i.e., 13 weeks) of routine small scale testing. Testing frequencies are those required by the TPC and may be more frequent than TSCA Title VI requires. b. Purchasing and setting up a small chamber test has a one-time cost of approximately $10,000. c. 84 hours each for the initial audit, and second routine TPC audit (8 hours total), 0.5 hours each to prepare shipping for the qualifying test, 40 hours for developing the quality control systems, 4 hours for the and second audit, (1 hour total), 1 hour per desk audit for 2 months, for NAF products (2 hours total), and 2 hours a day, 5 days a week to test samples for 13 weeks of quality control testing. (130 hours total).d. 5 panels for qualifying testing, 5 panels a week for 13 weeks of small scale testing, and 1 panel for the second large scale test. 

e. 4 hours for the annual on-site audit and 0.5 hours to ship samples. 

f. 1 panel for annual large scale testing. Sources: U.S. Bureau of Labor Statistics 2010b, Personal Communication with CPA 2011, Personal Communication with HPVA 2011b, RISI 2011cSources: BLS, 2010; Communications with CPA and HPVA, 2011; RISI, 2010..

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Table 2-37: Annual Testing and Certification Costs for Particleboard/MDF MillsaExisting Certification(s): Two ULEF Products – New Certification(s): Two NAF Products 

Cost Category Unit Cost Number of Units 

Repetitions for 

Product Types 

Total Cost to Certify

Product Line(s) 

Cost Incurred in 

Baseline for Existing 

Certification(s) 

Incremental Cost to 

Certify Product Line(s)

First Year 

Initial Certification Fee $3,700 1 fee 1 $3,700 $3,700 $0 Qualifying Test $480 5 tests 2 $4,800 $0 $4,800 Correlation Test $71.36 10 hours 2 $1,427 $0 $1,427 Qualifying Test Shipping $200 1 shipments 2 $400 $0 $400 TPC Audit $450 2 audits 1 $900 $450 $450 TPC Audit Travel $1,500 1 audit 1 $1,500 $1,500 $0 TPC Testing $480 1 test 2 $960 $3,840 ($2,880) TPC Testing Shipping $50 1 shipment 2 $100 $400 ($300) Small Chamber Testing Unitb $10,000 0 units 1 $0 $0 $0 Desk Audit $250 2 audits 1 $500 $0 $500 Mill Laborc $71.36 141 hours 1 $10,062 $642 $9,419 420Lost Productd $8.96 71 panels 2 $1,272 $72 $1,201 First Year Total $25,621 $10,604 $15,017 

Subsequent Years 

Re-certification Fee $3,700 1 fee 1 $3,700 $3,700 $0 TPC Audit $450 1 audit 1 $450 $450 $0 TPC Audit Travel $1,500 1 audit 1 $1,500 $1,500 $0 TPC Testing $480 1 test 2 $960 $3,840 ($2,880) TPC Testing Shipping $50 1 shipment 2 $100 $400 ($300) Desk Audit $250 0 audits 1 $0 $0 $0 Mill Labore $71.36 4.5 hours 1 $321 $642 ($321) Lost Productf $8.96 1 panel 2 $18 $72 ($54) Subsequent Year Total $7,049 $10,604 ($3,555) a. NAF certification can be achieved based on testing results from one quarterly test (using a primary or secondary test method) and 3 months (i.e., 13 weeks) of routine small scale testing. Testing frequencies are those required by the TPC and may be more frequent than TSCA Title VI requires. b. Purchasing and setting up a small chamber test has a one-time cost of approximately $10,000. c. 84 hours each for the initial audit, and second routine TPC audit (8 hours total), 0.5 hours each to prepare shipping for the qualifying test, 40 hours for developing the quality control systems, 4 hours for the and second audit, (1 hour total), 1 hour per desk audit for 2 months, for NAF products (2 hours total), and 2 hours a day, 5 days a week to test samples for 13 weeks of quality control testing. (130 hours total).d. 5 panels for qualifying testing, 5 panels a week for 13 weeks of small scale testing, and 1 panel for the second large scale test. e. 4 hours for the on-site audit and 0.5 hours to ship samples. f. 1 panel for annual large scale testing. Sources: U.S. Bureau of Labor Statistics 2010b, Personal Communication with CPA 2011, Personal Communication with HPVA 2011b, RISI 2011cSources: BLS, 2010; Communications with CPA and HPVA, 2011; RISI, 2010..

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1588 

Table 2-38: Annual Testing and Certification Costs for Particleboard/MDF MillsaExisting Certification(s): Two Standard Products – New Certification(s): Two NAF Products 

Cost Category Unit Cost Number of Units 

Repetitions for 

Product Types 

Total Cost to Certify

Product Line(s) 

Cost Incurred in 

Baseline for Existing 

Certification(s) 

Incremental Cost to 

Certify Product Line(s)

First Year 

Initial Certification Fee $6,000 1 fee 1 $6,000 $6,000 $0 Qualifying Test $480 5 tests 2 $4,800 $0 $4,800 Correlation Test $71.36 10 hours 2 $1,427 $0 $1,427 Qualifying Test Shipping $200 1 shipment 2 $400 $0 $400 TPC Audit $450 2 audits 1 $900 $1,800 ($900) TPC Audit Travel $1,500 1 audit 1 $1,500 $1,500 $0 TPC Testing $480 1 test 2 $960 $3,840 ($2,880) TPC Testing Shipping $50 1 shipment 2 $100 $400 ($300) Small Chamber Testing Unitb $10,000 0 units 1 $0 $0 $0 Desk Audit $250 2 audits 1 $500 $2,000 ($1,500) Mill Laborc $71.36 141 hours 1 $10,062 $38,962963 ($28,900901) Lost Productd $8.96 71 panels 2 $1,272 $4,731 ($3,459) First Year Total $27,921 $59,233 ($31,312) 

Subsequent Years 

Re-certification Fee $3,700 1 fee 1 $3,700 $6,000 ($2,300) TPC Audit $450 1 audit 1 $450 $1,800 ($1,350) TPC Audit Travel $1,500 1 audit 1 $1,500 $1,500 $0 TPC Testing $480 1 test 2 $960 $3,840 ($2,880) TPC Testing Shipping $50 1 shipment 2 $100 $400 ($300) Desk Audit $250 0 audits 1 $0 $2,000 ($2,000) Mill Labore $71.36 4.5 hours 1 $321 $38,962963 ($38,641) Lost Productf $8.96 1 panel 2 $18 $4,731 ($4,713) Subsequent Year Total $7,049 $59,233 ($52,184) a. NAF certification can be achieved based on testing results from one quarterly test (using a primary or secondary test method) and 3 months (i.e., 13 weeks) of routine small scale testing. Testing frequencies are those required by the TPC and may be more frequent than TSCA Title VI requires. b. Purchasing and setting up a small chamber test has a one-time cost of approximately $10,000. c. 84 hours each for the initial audit, and second routine TPC audit (8 hours total), 0.5 hours each to prepare shipping for the qualifying test, 40 hours for developing the quality control systems, 4 hours for the and second audit, (1 hour total), 1 hour per desk audit for 2 months, for NAF products (2 hours total), and 2 hours a day, 5 days a week to test samples for 13 weeks of quality control testing. (130 hours total).d. 5 panels for qualifying testing, 5 panels a week for 13 weeks of small scale testing, and 1 panel for the second large scale test. e. 4 hours for the on-site audit and 0.5 hours to ship samples. f. 1 panel for annual large scale testing. Sources: U.S. Bureau of Labor Statistics 2010b, Personal Communication with CPA 2011, Personal Communication with HPVA 2011b, RISI 2011cSources: BLS, 2010; Communications with CPA and HPVA, 2011; RISI, 2010..

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1590 

Table 2-39: Annual Testing and Certification Costs for Particleboard/MDF MillsaExisting Certification(s): One NAF Product and One ULEF Product – New Certification(s): Two NAF Products 

Cost Category Unit Cost Number of Units 

Repetitions for 

Product Types 

Total Cost to Certify

Product Line(s) 

Cost Incurred in 

Baseline for Existing 

Certification(s) 

Incremental Cost to 

Certify Product Line(s)

First Year 

Initial Certification Fee $3,700 1 fee 1 $3,700 $3,700 $0 Qualifying Test $480 5 tests 1 $2,400 $0 $2,400 Correlation Test $71.36 10 hours 1 $714 $0 $714 Qualifying Test Shipping $200 1 shipment 1 $200 $0 $200 TPC Audit $450 2 audits 1 $900 $450 $450 TPC Audit Travel $1,500 1 audit 1 $1,500 $1,500 $0 TPC Testing $480 1 test 12 $480960 $1,9202,400 ($1,440) TPC Testing Shipping $50 1 shipment 12 $50100 $200250 ($150) Small Chamber Testing Unitb $10,000 0 units 1 $0 $0 $0 Desk Audit $250 2 audits 1 $500 $0 $500 Mill Laborc $71.36 141 hours 1 $10,062 $642 $9,419 420Lost Productd $8.96 71 panels 12 $6361,272 $3645 $6001,228First Year Total $21,14122,308 $8,448987 $12,69313,321

Subsequent Years 

Re-certification Fee $3,700 1 fee 1 $3,700 $3,700 $0 TPC Audit $450 1 audit 1 $450 $450 $0 TPC Audit Travel $1,500 1 audit 1 $1,500 $1,500 $0 TPC Testing $480 1 test 12 $480960 $1,9202,400 ($1,440) TPC Testing Shipping $50 1 shipment 12 $50100 $200250 ($150) Desk Audit $250 0 audits 1 $0 $0 $0 Mill Labore $71.36 4.5 hours 1 $321 $642 ($321) Lost Productf $8.96 1 panel 12 $918 $3645 ($27) Subsequent Year Total $6,5107,049 $8,448987 ($1,938) a. NAF certification can be achieved based on testing results from one quarterly test (using a primary or secondary test method) and 3 months (i.e., 13 weeks) of routine small scale testing. Testing frequencies are those required by the TPC and may be more frequent than TSCA Title VI requires. b. Purchasing and setting up a small chamber test has a one-time cost of approximately $10,000. c. 84 hours each for the initial audit, and second routine TPC audit (8 hours total), 0.5 hours each to prepare shipping for the qualifying test, 40 hours for developing the quality control systems, 4 hours for the and second audit, (1 hour total), 1 hour per desk audit for 2 months, for NAF products (2 hours total), and 2 hours a day, 5 days a week to test samples for 13 weeks of quality control testing. (130 hours total).d. 5 panels for qualifying testing, 5 panels a week for 13 weeks of small scale testing, and 1 panel for the second large scale test. 

e. 4 hours for the on-site audit and 0.5 hours to ship samples. f. 1 panel for annual large scale testing. 

Sources: U.S. Bureau of Labor Statistics 2010b, Personal Communication with CPA 2011, Personal Communication with HPVA 2011b, RISI 2011cSources: BLS, 2010; Communications with CPA and HPVA, 2011; RISI, 2010..

1591 
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1592 

Table 2-40: Annual Testing and Certification Costs for Particleboard/MDF MillsaExisting Certification(s): One NAF Product and One Standard Product – New Certification(s): Two NAF Products 

Cost Category Unit Cost Number of Units 

Repetitions for 

Product Types 

Total Cost to Certify

Product Line(s) 

Cost Incurred in 

Baseline for Existing 

Certification(s) 

Incremental Cost to 

Certify Product Line(s)

First Year 

Initial Certification Fee $6,000 1 fee 1 $6,000 $6,000 $0 Qualifying Test $480 5 tests 1 $2,400 $0 $2,400 Correlation Test $71.36 10 hours 1 $714 $0 $714 Qualifying Test Shipping $200 1 shipment 1 $200 $0 $200 TPC Audit $450 2 audits 1 $900 $1,800 ($900) TPC Audit Travel $1,500 1 audit 1 $1,500 $1,500 $0 TPC Testing $480 1 test 12 $480960 $1,9202,400 ($1,440) TPC Testing Shipping $50 1 shipment 12 $50100 $200250 ($150) Small Chamber Testing Unitb $10,000 0 units 1 $0 $0 $0 Desk Audit $250 2 audits 1 $500 $2,000 ($1,500) Mill Laborc $71.36 141 hours 1 $10,062 $38,962963 ($28,900901) Lost Productd $8.96 71 panels 1 $636645 $2,365374 ($1,729) First Year Total $23,441980 $54,74855,287 ($31,306) 

Subsequent Years 

Re-certification Fee $3,700 1 fee 1 $3,700 $6,000 ($2,300) TPC Audit $450 1 audit 1 $450 $1,800 ($1,350) TPC Audit Travel $1,500 1 audit 1 $1,500 $1,500 $0 TPC Testing $480 1 test 12 $480960 $1,9202,400 ($1,440) TPC Testing Shipping $50 1 shipment 12 $50100 $200250 ($150) Desk Audit $250 0 audits 1 $0 $2,000 ($2,000) Mill Labore $71.36 4.5 hours 1 $321 $38,962963 ($38,641) Lost Productf $8.96 1 panel 12 $918 $2,365374 ($2,356) Subsequent Year Total $6,5107,049 $54,74855,287 ($48,237238) a. NAF certification can be achieved based on testing results from one quarterly test (using a primary or secondary test method) and 3 months (i.e., 13 weeks) of routine small scale testing. Testing frequencies are those required by the TPC and may be more frequent than TSCA Title VI requires. b. Purchasing and setting up a small chamber test has a one-time cost of approximately $10,000. c. 84 hours each for the initial audit, and second routine TPC audit (8 hours total), 0.5 hours each to prepare shipping for the qualifying test, 40 hours for developing the quality control systems, 4 hours for the and second audit, (1 hour total), 1 hour per desk audit for 2 months, for NAF products (2 hours total), and 2 hours a day, 5 days a week to test samples for 13 weeks of quality control testing. (130 hours total).d. 5 panels for qualifying testing, 5 panels a week for 13 weeks of small scale testing, and 1 panel for the second large scale test. e. 4 hours for the on-site audit and 0.5 hours to ship samples. f. 1 panel for annual large scale testing. Sources: U.S. Bureau of Labor Statistics 2010b, Personal Communication with CPA 2011, Personal Communication with HPVA 2011b, RISI 2011cSources: BLS, 2010; Communications with CPA and HPVA, 2011; RISI, 2010..
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May 1, 2013 2-69 

Table 2-41: Annual Testing and Certification Costs for Wood Veneer Laminators 

Existing Certification(s): One Uncertified Product – New Certification(s): One 

Standard Product 

Cost Category Unit Cost Number of Units 

Repetitions for 

Product Types Total Cost 

First Year 

Initial Certification Fee $6,000 1 fee 1 $6,000 

Qualifying Test $480 5 tests 1 $2,400 

Correlation Test $71.36 10 tests 1 $714 

Qualifying Test Shipping $200 1 shipment 1 $200 

TPC Audit $450 4 audits 1 $1,800 

TPC Audit Travel $1,500 1 audit 1 $1,500 

TPC Testing $480 3 tests 1 $1,440 

TPC Testing Shipping $50 3 shipments 1 $150 

Small Chamber Testing Unit $10,000 1 unit 1 $10,000 

Desk Audit $250 8 audits 1 $2,000 

Mill Labora $71.36 590 hours 1 $42,102 

Lost Productb $15.68 268 panels 1 $4,202 

First Year Total $72,508 

Subsequent Years

Re-certification Fee $6,000 1 fee 1 $6,000 

TPC Audit $450 4 audits 1 $1,800 

TPC Audit Travel $1,500 1 audit 1 $1,500 

TPC Testing $480 4 tests 1 $1,920 

TPC Testing Shipping $50 4 shipments 1 $200 

Desk Audit $250 8 audits 1 $2,000 

Mill Laborc $71.36 546 hours 1 $38,963 

Lost Productd $15.68 264 panels 1 $4,140 

Subsequent Year Total $56,522 

a. 8 hours for the initial audit, 4 hours each for 3 routine TPC audits (12 hours total), 0.5 hours each to prepare shipping for the 

qualifying test, and the 3 other TPC tests (2 hours total), 40 hours for developing the quality control systems, 4 hours for other 

quarterly audits, 1 hour per monthly desk audit for the other 8 months, (8 hours total), and 2 hours a day to test samples for 52 

weeks of quality control testing. (520 hours total).

b. 5 panels for qualifying testing, 1 panel a day for 52 weeks of small scalequality control testing, and 1 panel for each 

quarterly large scalechamber TPC test. (excluding the first quarter in year 1).

c. 4 hours each for otherquarterly routine TPC audits (16 hours total), 0.5 hours each to prepare for shipping the quarterly 

audits,TPC tests (2 hours total), 1 hour per desk audit for the other 8 months, (8 hours total), and 2 hours a day to select and 

shiptest samples for 52 weeks of quality control testing. (520 hours total).

d. 1 panel a day for 52 weeks of small scale testing, and 1 panel for each quarterly large scale test. 

Sources: U.S. Bureau of Labor Statistics 2010b, Personal Communication with CPA 2011, Personal 

Communication with HPVA 2011b, RISI 2011cBLS, 2010; Communications with CPA and HPVA, 2011; RISI, 

2010..

1593 
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1594 

Table 2-42: Annual Testing and Certification Costs for Wood Veneer Laminators 

Existing Certification(s): Two Uncertified Products – New Certification(s): Two 

Standard Products 

Cost Category Unit Cost Number of Units 

Repetitions 

for Product 

Types Total Cost 

First Year 

Initial Certification Fee $6,000 1 fee 1 $6,000 

Qualifying Test $480 5 tests 2 $4,800 

Correlation Test $71.36 10 tests 2 $1,427 

Qualifying Test Shipping $200 1 shipment 2 $400 

TPC Audit $450 4 audits 1 $1,800 

TPC Audit Travel $1,500 1 audit 1 $1,500 

TPC Testing $480 3 tests 2 $2,880 

TPC Testing Shipping $50 3 shipments 2 $300 

Small Chamber Testing Unit $10,000 1 unit 1 $10,000 

Desk Audit $250 8 audits 1 $2,000 

Mill Labora $71.36 590 hours 1 $42,102 

Lost Productb $15.68 268 panels 2 $8,404 

First Year Total $81,614 

Subsequent Years

Re-certification Fee $6,000 1 fee 1 $6,000 

TPC Audit $450 4 audits 1 $1,800 

TPC Audit Travel $1,500 1 audit 1 $1,500 

TPC Testing $480 4 tests 2 $3,840 

TPC Testing Shipping $50 4 shipments 2 $400 

Desk Audit $250 8 audits 1 $2,000 

Mill Laborc $71.36 546 hours 1 $38,963 

Lost Productd $15.68 264 panels 2 $8,279 

Subsequent Year Total $62,782

a. 8 hours for the initial audit, 4 hours each for 3 routine TPC audits (12 hours total), 0.5 hours each to prepare shipping for the 

qualifying test, and the 3 other TPC tests (2 hours total), 40 hours for developing the quality control systems, 4 hours for 

other quarterly audits, 1 hour per monthly desk audit for the other 8 months, (8 hours total), and 2 hours a day to test 

samples for 52 weeks of quality control testing. (520 hours total).

b. 5 panels for qualifying testing, 1 panel a day for 52 weeks of small scalequality control testing, and 1 panel for each 

quarterly large scalechamber TPC test. (excluding the first quarter in year 1).

c. 4 hours each for otherquarterly routine TPC audits (16 hours total), 0.5 hours each to prepare for shipping the quarterly 

audits,TPC tests (2 hours total), 1 hour per desk audit for the other 8 months, (8 hours total), and 2 hours a day to select 

and shiptest samples for 52 weeks of quality control testing. (520 hours total). 

d. 1 panel a day for 52 weeks of small scale testing, and 1 panel for each quarterly large scale test. 

Sources: U.S. Bureau of Labor Statistics 2010b, Personal Communication with CPA 2011, Personal 

Communication with HPVA 2011b, RISI 2011cBLS, 2010; Communications with CPA and HPVA, 2011; RISI, 

2010..

1595 
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1596 

Table 2-43: Annual Testing and Certification Costs for Wood Veneer Laminatorsa

Existing Certification(s): One Uncertified Product – New Certification(s): One NAF 

Product 

Cost Category Unit Cost Number of Units 

Repetitions for 

Product Types Total Cost 

First Year 

Initial Certification Fee $6,000 1 fee 1 $6,000 

Qualifying Test $480 5 tests 1 $2,400 

Correlation Test $71.36 10 tests 1 $714 

Qualifying Test Shipping $200 1 shipment 1 $200 

TPC Audit $450 2 audits 1 $900 

TPC Audit Travel $1,500 1 audit 1 $1,500 

TPC Testing $480 1 test 1 $480 

TPC Testing Shipping $50 1 shipment 1 $50 

Small Chamber Testing Unit $10,000 1 unit 1 $10,000 

Desk Audit $250 2 audits 1 $500 

Mill Laborb $71.36 185 hours 1 $13,202 

Lost Productc $15.68 71 panels 1 $1,113 

First Year Total $37,058 

Subsequent Years

Re-certification Fee $3,700 1 fee 1 $3,700 

TPC Audit $450 1 audit 1 $450 

TPC Audit Travel $1,500 1 audit 1 $1,500 

TPC Testing $480 1 test 1 $480 

TPC Testing Shipping $50 1 shipment 1 $50 

Mill Labord $71.36 4.5 hours 1 $321 

Lost Producte $15.68 1 panel 1 $16 

Subsequent Year Total $6,517 

a. NAF certification can be achieved based on testing results from one quarterly test (using a primary or secondary test 

method) and 3 months (i.e., 13 weeks) of routine small scale testing. Testing frequencies are those required by the TPC and 

may be more frequent than TSCA Title VI requires. 

b. 8 hours for the initial audit, 4 hours for a TPC routine audit, 0.5 hours each to prepare shipping for the qualifying test, and 

the subsequent TPC test (1 hour total), 40 hours for developing the quality control systems, 4 hours for the second audit, 1 

hour per desk audit for 2 months,audits (2 hours total), and 2 hours a day to test samples for 13 weeks of quality control 

testing. (130 hours total).

c. 5 panels for qualifying testing, 1 panel a day for 13 weeks of small scale testing, and 1 panel for the second large scale test. 

d. 4 hours for the on-site audit and 0.5 hours to ship samples. 

e. 1 panel for annual large scale testing. 

Sources: U.S. Bureau of Labor Statistics 2010b, Personal Communication with CPA 2011, Personal 

Communication with HPVA 2011b, RISI 2011cSources: BLS, 2010; Communications with CPA and HPVA, 

2011; RISI, 2010..

1597 
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1598 

Table 2-44: Annual Testing and Certification Costs for Wood Veneer Laminatorsa

Existing Certification(s): Two Uncertified Products – New Certification(s): Two NAF 

Products 

Cost Category Unit Cost Number of Units 

Repetitions for 

Product Types Total Cost 

First Year 

Initial Certification Fee $6,000 1 fee 1 $6,000 

Qualifying Test $480 5 tests 2 $4,800 

Correlation Test $71.36 10 tests 2 $1,427 

Qualifying Test Shipping $200 1 shipment 2 $400 

TPC Audit $450 2 audits 1 $900 

TPC Audit Travel $1,500 1 audit 1 $1,500 

TPC Testing $480 1 test 2 $960 

TPC Testing Shipping $50 1 shipment 2 $100 

Small Chamber Testing Unit $10,000 1 unit 1 $10,000 

Desk Audit $250 2 audits 1 $500 

Mill Laborb $71.36 185 hours 1 $13,202 

Lost Productc $15.68 71 panels 2 $2,227 

First Year Total $42,015 

Subsequent Years

Re-certification Fee $3,700 1 fee 1 $3,700 

TPC Audit $450 1 audit 1 $450 

TPC Audit Travel $1,500 1 audit 1 $1,500 

TPC Testing $480 1 test 2 $960 

TPC Testing Shipping $50 1 shipment 2 $100 

Mill Labord $71.36 4.5 hours 1 $321 

Lost Producte $15.68 1 panel 2 $31 

Subsequent Year Total $7,062 

a. NAF certification can be achieved based on testing results from one quarterly test (using a primary or secondary test 

method) and 3 months (i.e., 13 weeks) of routine small scale testing. Testing frequencies are those required by the TPC and 

may be more frequent than TSCA Title VI requires. 

b. 8 hours for the initial audit, 4 hours for a TPC routine audit, 0.5 hours each to prepare shipping for the qualifying test, and 

the subsequent TPC test (1 hour total), 40 hours for developing the quality control systems, 4 hours for the second audit, 1 

hour per desk audit for 2 months,audits (2 hours total), and 2 hours a day to test samples for 13 weeks of quality control 

testing. (130 hours total).

c. 5 panels for qualifying testing, 1 panel a day for 13 weeks of small scale testing, and 1 panel for the second large scale test. 

d. 4 hours for the on-site audit and 0.5 hours to ship samples. 

e. 1 panel for annual large scale testing. 

Sources: U.S. Bureau of Labor Statistics 2010b, Personal Communication with CPA 2011, Personal 

Communication with HPVA 2011b, RISI 2011cSources: BLS, 2010; Communications with CPA and HPVA, 

2011; RISI, 2010..

1599 

1600 2.2.5.1 Summary of Estimated Testing and Certification Costs 

1601 

1602 Table 2-45 summarizes the estimated actual and incremental costs incurred by mills for 

1603 complying with the testing and certification requirements of TSCA Title VI. As described above, mills 

1604 with existing CARB-certified product lines will be incurring some testing and certifications costs in the 

1605 baseline. The incremental costs of the rule represent the actual costs minus baseline costs. 

1606 
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May 1, 2013 2-73 

Table 2-45: Summary of Annual Testing and Certification Costs by Mill Type

First Year Subsequent Years 

Existing 

Certifications Certification Sought 

Actual 

Costs 

Incremental 

Costs Actual Costs 

Incremental 

Costs 

Hardwood Plywood Mills and Wood Veneer Laminators 

2 Uncertified Change 2 to NAF a $42,015 $42,015 $7,062 $7,062 

2 Uncertified Change 2 to NAF (SFCC) b $33,460 $33,460 $7,062 $7,062 

2 Uncertified Change 2 to NonexemptStandard a $81,614 $81,614 $62,782 $62,782 

2 Uncertified Change 2 to Standard (SFCC) b $72,435 $72,435 $61,950 $61,950 

2 Standard Maintain 2 Standard c $72,782 $10,832 $62,782 $832

2 

NonexemptStandard Change 2 to NAFNAFd $38,876 ($23,074) $7,062 ($54,887) 

2 ULEF Change 2 to 

NonexemptStandarde $72,782 $62,124 $62,782 $52,124 

1 ULEF and 1 NAF Change ULEF to NAF d,e $31,61932,14

9 $22,50123,128 $6,5177,047 ($1,958974) 

1 ULEF and 1 NAF Change 2 to Nonexempt $72,782 $63,683 $62,782 $53,761 

2 ULEF Change 2 to NAFNAFd $36,576 $2325,918 $7,062 ($3,595) 

Particleboard and MDF Mills 

2 Uncertified Change 2 to Nonexempt $78,012 $78,012 $59,233 $59,233 

2 Uncertified Change 2 to NAF $41,061 $41,061 $7,049 $7,049 

1 Uncertified and 1 

NonexemptStandard

Change Uncertified to 

NonexemptStandard

$57,56759,93

3 $7,3055,185 $54,74859,233 $4,485 

2 ULEF Change 2 to 

NonexemptStandarde $59,233 $48,630 $59,233 $48,630 

1 ULEF and 1 NAF Change 2 to Nonexempt $59,233 $50,246 $59,233 $50,246 

1 Uncertified and 1 

NonexemptStandard Change 2 to NAFNAFd $27,921 ($26,827) $7,049 ($47,699) 

2 ULEF Change 2 to NAFNAFd $25,621 $15,017 $7,049 ($3,555) 

2 

NonexemptStandard Change 2 to NAFNAFd $27,921 ($31,312) $7,049 ($52,184) 

1 ULEF and 1 NAF Change ULEF to NAF d,e $21,14222,30

8 $12,69313,321 $6,5107,049 ($1,938) 

1 

NonexemptStandard

and 1 NAF 

Change NonexemptStandard to 

NAFNAFd $23,442980 ($31,306) $6,5107,049 ($48,238) 

Wood Veneer Laminated Product Producers 

1 Uncertified Change 1 to NonexemptStandard a $72,508 $72,508 $56,522 $56,522 

2 Uncertified Change 2 to NonexemptStandard a $81,614 $81,614 $62,782 $62,782 

1 Uncertified Change 1 to NAF a $37,058 $37,058 $6,517 $6,517 

2 Uncertified Change 2 to NAF a $42,015 $42,015 $7,062 $7,062 

Standard product certification is for Phase 2 emissions standards.

a. These estimates apply to the options that require mills to hold tested lots until the results are available (all options other than Option 

SFCC). Mills without a small chamber unit are assumed to comply with this requirement by purchasing test chambers and conducting daily 

on-site QC testing, resulting in the incremental costs presented here. 

b. Under Option SFCC panels can be shipped before test results are available. Therefore, hardwood plywood mills are assumed to have the 

TPC perform the quality control testing on a weekly basis. Under the other options, hardwood plywood mills are assumed to perform their 

own daily testing to avoid having to wait for weekly test results to be completed before shipping tested lots. 

c. There are no incremental costs for this certification Option SFCC. 

d. Applies to options where NAF emissions standards are required

e. Applies to options that do not allow ULEF exemption

1607 

1608 

Formatted Table

Formatted Table

Formatted Table

Formatted Table

Formatted Table

Formatted Table

Formatted Table

Formatted Table
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May 1, 2013 2-74 

1609 2.3 Estimated Costs for Stock Hardwood Plywood, MDF, and Particleboard 

1610 Producers 

1611 

1612 This section presents the potential costs to stock hardwood plywood, medium density fiberboard 

1613 (MDF) and particleboard producers under several analytical options. Section 2.3.1 presents the estimated 

1614 costs to composite wood panel producers for making changes to raw materials. Section 2.3.2 presents the 

1615 estimated costs of testing and third party certification for composite wood panel producers. Finally, the 

1616 total estimated costs for composite wood panel producers are presented in section 2.3.3. 

1617 

1618 2.3.1 Costs of Changes to Raw Materials for Composite Wood Panel Producers 

1619 

1620 This section presents the estimated costs to stock hardwood plywood (section 2.3.1.1), MDF 

1621 (section 2.3.1.2), and particleboard (section 2.3.1.3) producers for making changes to production 

1622 processes and raw materials. 

1623 

1624 2.3.1.1 Stock Hardwood Plywood Producers Production Processes and Raw Materials Costs 

1625 

1626 For stock hardwood plywood producers that are not compliant with the emissions standards in the 

1627 baseline, the costs associated with changing production processes and raw materials are estimated as the 

1628 costs of switching from UF to PVA resin systems and switching from conventional to lower emitting 

1629 cores. Because the emissions standard for hardwood plywood (0.05 ppm) is lower than the standards for 

1630 particleboard (0.09 ppm) and MDF (0.11 to 0.13 ppm), hardwood plywood made with a certified 

1631 particleboard or MDF core could conceivably exceed the emission standard even if a NAF resin such as 

1632 PVA was used to affix the veneer to the core. (Whether this occurs in practice depends on how 

1633 effectively the veneer acts as a barrier to the release of formaldehyde, and how far below the standards the 

1634 actual emissions from the core are.) 

1635 

1636 This analysis uses the term “low emission cores” to mean cores with emissions low enough that 

1637 hardwood plywood made from them meets the applicable emission standard. For the standard 

1638 certification, low emission cores are assumed to include certified veneer core, particleboard and MDF 

1639 cores certified as ULEF under the CARB ATCM, and particleboard and MDF cores certified as NAF. 

1640 For analytical options requiring all products to meet NAF emission levels, low emission cores would 

1641 include particleboard, MDF and veneer cores certified as NAF. 

1642 

1643 Hardwood plywood producers switching from UF to PVA resins and low emission cores would 

1644 not need to make any significant modifications or upgrades to existing equipment or processes because 

1645 PVA resins are generally a “drop-in” technology for mills currently using UF. Thus, the estimated raw 

1646 material costs are only for purchasing the more expensive resins and cores. Note that switching to PVA 

1647 resins is just one possibility for achieving compliance. Some producers may achieve compliance by using 

1648 enhanced urea formaldehyde resins, melamine-urea-formaldehyde (MUF) resins, soy-based resins, or 

1649 other resin systems. However, the cost of switching to PVA resins can provide a reasonable 

1650 approximation for the compliance cost associated with changing raw materials and production processes 

1651 and therefore is the basis for the cost estimates in this analysis. Note also that not all mills will 

1652 necessarily have to switch to NAF or ULEF cores in order to meet the Phase 2 emissions standard for 

1653 hardwood plywood. 

1654 

1655 Number of Hardwood Plywood Mills and Affected Production Volume 

1656 

1657 EPA identified 33 mills (owned by 27 firms) that appear to manufacture stock hardwood plywood 

1658 panels subject to the TSCA Title VI emissions requirements. Based on a review of CARB’s list of 

1659 certified mills, 26 of the 33 hardwood plywood stock panel mills identified by EPA are certified to 
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May 1, 2013 2-75 

1660 produce CARB compliant products (2011b). This implies that there are 7 stock plywood mills that are 

1661 not CARB certified and that are expected to incur compliance costs to become certified due to the TSCA 

1662 Title VI regulation. For the purpose of this analysis it is also assumed that all 7 of these mills are three1663 ply mills (which buy cores and finish them with hardwood veneer). 

1664 

1665 In addition to the 33 hardwood plywood mills, EPA identified another 8 mills (owned by 7 firms) 

1666 that manufacture engineered wood flooring. Based on a review of CARB’s list of certified mills, 4 are 

1667 certified to produce CARB compliant products (2011c2011b). 

1668 

1669 According to CARB’s (2011b)) list of certified mills, 12 mills (including engineered wood 

1670 flooring mills) are certified to produce NAF hardwood plywood – for the purpose of this analysis these 

1671 mills are assumed to produce NAF product exclusively. Note that additional CARB certified mills might 

1672 have compliance costs if they produce some product lines that are not certified when the TSCA Title VI 

1673 requirements take effect in 2013. EPA is not aware of any mills in this situation, but the compliance costs 

1674 for individual mills producing some CARB certified product and some product not CARB certified would 

1675 be expected to be lower than the costs presented here. 

1676 

1677 According to U.S. ITC (2008), hardwood plywood production in 2006, including engineered 

1678 wood flooring, was estimated to be 1,786 thousand cubic meters, or 2,007 mmsf on a 3/8" basis. 

1679 Engineered wood flooring production was estimated to be 258 mmsf in 2006 and it is estimated that about 

1680 30 percent of engineered wood flooring production is manufactured as a wood veneer laminated product 

1681 (Personal Communication with HPVA 2011a) and therefore 77 mmsf of engineered wood flooring 

1682 production is accounted for as wood veneer laminated product instead of hardwood plywood for the 

1683 purpose of this analysis. Thus, excluding the wood veneer laminated product results in an estimated 2006 

1684 domestic production for hardwood plywood of 1,930 million square feet on a 3/8" basis. It is estimated 

1685 that current production levels are about 60 percent of their 2006 levels, or about 1,158 mmsf on a 3/8" 

1686 basis. 

1687 

1688 Table 2-46 presents the estimated production affected by analytical option. These results are 

1689 estimated by combining the production estimates described above and the emissions standards and levels 

1690 reported by mills in EPA’s (2010a) Pressed Wood Manufacturing Industry Survey (PWMIS). EPA 

1691 administered this survey between June and October 2010 to domestic producers of composite wood 

panels. The survey achieved a response from 33 hardwood plywood mills that received the survey.18 1692 The 

1693 survey asked about current emissions levels and about planned levels. Since many composite wood 

1694 product mills were in the midst of modifying their production technology and raw materials to achieve 

1695 compliance with Phase 2 of the CARB ATCM when they completed the questionnaire, using data on their 

1696 emission levels at the time they responded to the survey would not accurately reflect the 2013 baseline. 

1697 Instead, baseline emission levels are estimated using responses to a question in the survey about the 

1698 emissions levels mills planned to achieve within the next three years of when they completed the survey 

1699 (i.e., three years from 2010). These emissions levels were weighted by the production levels the mills 

1700 reported in the survey, in order to estimate the average emission levels by certification standard. The 

1701 survey data were also used to estimate the share of total production volume represented by products 

1702 meeting each of the emissions standards. 

1703 

 18 The number of mills for each product type is limited to those that are subject to TSCA Title VI, and does not include 

mills that only produce products that are exempted or not otherwise covered by TSCA Title VI (such as curved 

plywood, wood packaging, and molded products that do not qualify as panels). The response rate includes mills that 

only responded to a brief phone questionnaire, which collected information about the compliance standards being 

achieved, but not specific emissions levels. 

Field Code Changed

Field Code Changed
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May 1, 2013 2-76 

Table 2-46: Hardwood Plywood Production Affected By Analytical Option (mmsf)

Baseline Emission 

Standard 

Production 

Share 

Production 

Level 

Affected Production 

Options SI, SE, 

SP, SC, SCR, 

SEUR, SFCC, 

and SCRSCUR

Options CI and 

CE 

Options NI and 

NE 

None 0.40% 4.6 4.6 4.6 4.6 

CARB 1 - - - - - 

CARB 2 and CARB ULEFa 60.20% 697.1 - - 697.1 

CARB NAF 39.40% 456.3 - - - 

Total 100.00% 1,158.0 4.6 4.6 701.7 a

 Hardwood plywood mills meeting CARB 2 and CARB ULEF were grouped together in the CARB 2 category. Several 

hardwood plywood mills appeared to be meeting CARB ULEF standards but did not report this in their response. For 

example, they listed certification standard as “CARB 2” but resin type as “ULEF” and/or reported maximum emissions 

that satisfy ULEF requirements. Due to difficulties in distinguishing between CARB 2 and CARB ULEF product lines in 

the survey responses, and the fact that emissions levels appeared similar among mills reporting either CARB 2 or CARB 

ULEF certification standards, these mills were grouped together. 

Option SCRSCUR is the proposed option. 

Source:U.S. Environmental Protection Agency 2010a.

1704 

1705 Hardwood Plywood Producer Costs for Changing Raw Materials 

1706 

1707 For cost estimation purposes, it is assumed that mills using urea formaldehyde (UF) resins in the 

baseline will switch to polyvinyl acetate (PVA) resins in order to meet the emissions standards.19 1708 Some 

1709 mills may also have to switch to a low emitting core to meet the emissions standard. The main steps to 

1710 estimating the cost increase resulting from the TSCA Title VI rule for stock hardwood plywood mills 

1711 without baseline CARB certification are presented below: 

1712 

1713 1. Estimate the total production volume from facilities that are expected to continue to use UF resins 

1714 in the absence of a national rule. 

1715 2. Estimate the unit cost of switching from UF to PVA resins. 

1716 3. Estimate unit cost of switching from a CARB certified core to a low emission core. 

1717 4. Estimate the cost of third party certification and compliance testing. 

1718 5. Estimate the average cost per firm by multiplying the unit costs with the typical production 

1719 volume per firm under different scenarios for the raw materials changes that firms may need to 

1720 make to become certified. 

1721 Note that switching to PVA resins is just one possibility for achieving compliance. Some 

1722 producers may achieve compliance by using enhanced urea formaldehyde resins, melamine-urea1723 formaldehyde (MUF) resins, soy-based resins, or other resin systems. However, the cost of switching to 

1724 PVA resins can provide a reasonable approximation for the compliance cost associated with changing raw 

1725 materials and production processes and therefore is the basis for the cost estimates in this analysis. 

1726 

1727 

 19 Note that switching to a resin system other than PVA may be a lower cost compliance strategy. Using enhanced UF 

resins and soy-based resins are proven compliance strategies that may be less costly for some manufacturers. 
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May 1, 2013 2-77 

1728 Production Volume Switching to PVA Resins 

1729 

1730 As described above, it is estimated that only 0.4 percent of domestic baseline hardwood plywood 

1731 production will not be CARB certified in the absence of the TSCA Title VI rule. For the purpose of this 

1732 analysis it is assumed that about half of the product that is not CARB certified is already being produced 

1733 using PVA resins. It is assumed that these products already meet the CARB Phase 2 emission standards, 

1734 but that the producers have not chosen to incur the costs of CARB’s third-party certification program 

1735 because the products are not sold into California. 

1736 

1737 It is assumed that the other half of the uncertified product is being produced with UF resins, and 

1738 that the product exceeds the CARB Phase 2 emission limits. Thus, 0.2 percent of stock hardwood 

1739 plywood production, or 2,300 msf, is assumed to be subject to costs associated with changing resin 

1740 systems under the statutory option. Under options NI and NE, in addition to the 2,300 msf of uncertified 

1741 production switching resins, the 697,100 msf of production that is currently CARB 2 or ULEF certified 

1742 but not NAF certified is assumed to need to switch resin systems, for a total of 699,400 msf switching to 

1743 NAF resins. Firms using UF resins in the baseline are assumed to switch to PVA resins to meet the 

1744 TSCA Title VI emissions standards. PVA resins are a common resin choice of smaller mills, and are a 

1745 no-added formaldehyde (NAF) resin. 

1746 

1747 Additional Cost of PVA Resins 

1748 

1749 Hardwood plywood mills switching from UF to PVA resins would not need to make any 

1750 significant modifications or upgrades to existing equipment or processes because PVA resins are 

1751 generally a “drop-in” technology for mills currently using UF. The only costs estimated are for 

1752 purchasing the more expensive resin. 

1753 

1754 The additional cost to hardwood plywood mills for switching from UF to PVA resin depends on 

1755 the glue spread and the total surface area of the finished panels produced. It is assumed that these mills 

1756 apply two glue lines: one to adhere the face panel and the other to adhere the back panel. The weight of 

1757 each glue line is about 30 pounds per thousand square feet (msf) of plywood produced, and PVA resin 

1758 costs about $0.50 per pound more than UF resin (Personal Communication with Evergreen Engineering 

2009.). It is assumed that the panels made by these mills average 5/8 inches thick.20 1759 Therefore, the extra 

1760 cost of using PVA can be estimated on a 5/8” basis as follows: 

1761 

1762 Additional cost of PVA (5/8” basis) = (30 pounds/msf of glue line) x (2 glue lines) x ($0.5) = $30 

1763 per msf of plywood produced. 

1764 

1765 Since hardwood plywood production volume is tabulated on a 3/8 inches basis, the following conversion 

1766 is needed to estimate the additional cost of PVA: 

1767 

1768 Additional cost of PVA (3/8” basis) = ($30/msf) x (.625”/.375”) = $50/msf of plywood produced. 

1769 

1770 As a result, these small mills converting their production from UF resins to PVA resins would 

1771 incur an additional cost of $50/msf of plywood produced on a 3/8” basis. 

1772 

1773 

1774 

 20 Common panel thicknesses range from 3/8 inch to 3/4 inch. A 5/8 inch basis is used to represent the average across all 

mills. 
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May 1, 2013 2-78 

1775 Production Volume Switching to Low Emission Cores 

1776 

1777 Since nearly all domestic core suppliers are manufacturing only CARB certified products, 

1778 virtually the only source of cores that are not CARB certified would be imports. Given this, the baseline 

1779 level of production using cores that are not certified may be near zero. However, in order to meet the 

1780 hardwood plywood emissions standards, some hardwood plywood producers using CARB certified 

1781 particleboard or medium density fiberboard (MDF) cores may need to switch to ultra-low emitting 

1782 formaldehyde (ULEF) or NAF cores. This is because the emissions standards are higher for particleboard 

and MDF than for hardwood plywood.21 1783 In addition, 2 percent of engineered wood flooring producers 

1784 utilize composite cores (Personal Communication with HPVA 2011a), and would need to make the 

1785 switch to low emission cores, as well. 

1786 

1787 This analysis estimates the percentage of hardwood plywood and engineered wood flooring 

1788 production that would need to switch to low emission cores in three steps: 

1789 

1790 1. The percentage of hardwood plywood and engineered wood flooring production that use MDF 

1791 and particleboard for cores are estimated from the 2007 U.S. Economic Census (U.S. Census 

Bureau 2009e) data on the value of raw materials used for production22 1792 

1793 2. These percentages are adjusted to account for the baseline use of NAF or ULEF cores with the 

1794 percentage of domestic MDF and particleboard production that is estimated to be CARB NAF or 

1795 ULEF certified, estimated from EPA’s (2010a) survey of composite wood product producers. 

1796 3. The estimated percentage of cores that must be switched to low emission cores is applied to the 

1797 estimated total production volume. 

1798 

1799 Table 2-47 presents the estimated production that would need to switch to low emission cores by 

1800 analytical option. The resulting estimates and a detailed description of the underlying calculations are 

1801 presented below in Table 2-47. 

 21 The Phase 2 standards are 0.05 ppm for hardwood plywood, 0.09 ppm for particleboard, 0.11 ppm for MDF, and 0.13 

ppm for thin MDF. 

22 The mix of composite wood products consumed was estimated using U.S. Census data on the value of materials 

consumed. Values were converted to volumes using prices of $495, $535, and $335 per msf for hardwood plywood, 

MDF, and particleboard, respectively. The price of hardwood plywood was estimated using the total 2007 export 

values and quantities from U.S. ITC (2011) (HTS codes 441232, 441299, and 441231). The price of MDF and 

particleboard are from Crow’s February 18, 2011 Weekly Panel Prices (RISI 2011b). 
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May 1, 2013 2-79 

1802 

Table 2-47: Hardwood Plywood Production Switching to Low Emission Cores Analytical Option 

Production 

(mmsf, 

3/8”) 

Production 

Switching to 

Low Emission 

Cores 

Description of Estimated Percentages a, b (%) (mmsf) 

Options SI, SE, SP, SC, SCR, SEUR, SFCC, and SCRSCUR 4.6 32.3% 1.5 

Based on conversations with HPVA (2011a), 40% of hardwood plywood stock panels and 2% of engineered wood flooring are composite core. It was estimated that the mix of MDF and particleboard consumed in the Hardwood Veneer and Plywood Industry (NAICS 321211) is about 40.9% MDF and 59.1% particleboard. It was also estimated that 86.1% and 90.5% of MDF and particleboard are not made with NAF or ULEF resins, respectively. Thus, the percentage of hardwood plywood stock panels switching to low emission cores (35.48%) is calculated as the sum of the two products of: (1) 40%, 40.9%, and 86.1%, and (2) 40%, 59.1%, and 90.5%. Similarly, the percentage of engineered wood flooring switching to low emission cores (1.77%) is calculated as the sum of the two products of: (1) 2%, 40.9%, and 86.1%, and (2) 2%, 59.1%, and 90.5%. Since engineered wood flooring represents about 9.4% of hardwood plywood production, the percentage of production switching to low emission cores overall is 32.3%, calculated as the sum of the two products: (1) 1.77% and 9.4% and (2) 35.48% and 90.6%. 

Options CI and CE - - - 

All mills are assumed to be able to meet these emissions standards without any changes to production processes or raw materials. 

Options NI and NE 701.7 72.1% 505.9 

Based on conversations with HPVA (2011a), 40% of hardwood plywood stock panels and 2% of engineered wood flooring are composite core. It was estimated that the mix of MDF and particleboard consumed in the Hardwood Veneer and Plywood Industry (NAICS 321211) is about 40.9% MDF and 59.1% particleboard. Thus, the mix of veneer core, MDF and particleboard for stock hardwood plywood panels is about 60.0% hardwood plywood, 16.4% MDF and 23.6% particleboard. Similarly, the mix of veneer core, MDF and particleboard for engineered wood flooring is about 98.0% hardwood plywood, 0.8% MDF and 1.2% particleboard. It was also estimated that 60.6%, 90.7%, and 93.3% of HWPW, MDF and particleboard use added formaldehyde resins, respectively. Thus, the percentage of hardwood plywood stock panels switching to NAF cores (73.25%) is calculated as the sum of the three products: (1) 60% and 60.6%, (2) 16.4% and 90.7%, and (3) 23.6% and 93.3%. Likewise, the percentage of engineered wood flooring switching to NAF cores (61.23%) is calculated as the sum of the three products: (1) 98% and 60.6%, (2) 0.8% and 90.7%, and (3) 1.2% and 93.3%. Since engineered wood flooring represents about 9.4% of hardwood plywood production, the percentage of production switching to NAF cores overall is 72.1%, calculated as the sum of the two products: (1) 61.23% and 9.4% and (2) 73.25% and 90.6%. 

a The mix of composite wood products consumed were estimated using 2007 U.S. Census (2009e) data on the value of materials consumed. Values were converted to volumes using 2007$ prices of 

$480, $445, and $315 for hardwood plywood, MDF, and particleboard, respectively. The price of hardwood plywood was estimated using the total 2007 export values and quantities from U.S. ITC 

(2011) data (HTS codes 441232, 441299, and 441231). The price of MDF and particleboard utilized are July 2007 prices from RISI’s (2009) MDF and Particleboard Commentary. b The percentages of composite platforms not made with NAF or ULEF resins was estimated from EPA’s (2010a) survey of composite wood product producers. 

This analysis uses the term “low emission cores” to mean cores with emissions low enough that hardwood plywood made from them meets the applicable emission standard. For the standard 

certification, low emission cores are assumed to include certified veneer core, particleboard and MDF cores certified as ULEF under the CARB ATCM, and particleboard and MDF cores certified as NAF. For analytical options requiring all products to meet NAF emission levels, low emission cores would include particleboard, MDF and veneer cores certified as NAF. Option SCRSCUR is the proposed option.

1803 
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May 1, 2013 2-80 

1804 Additional Cost of Low Emission Cores 

1805 

1806 The average cost of a Phase 2 certified core is approximately $300/msf, and NAF cores currently 

cost 15 to 20 percent more than Phase 2 platforms.23 1807 So a high end estimate of the additional cost 

1808 associated with purchasing low emission cores is estimated at $45/msf-$60/msf. Although there is 

1809 uncertainty about the extent to which hardwood plywood producers would need to switch to low emitting 

1810 cores in order to meet the emissions standards, this analysis adopts the conservative assumption (in terms 

1811 of being careful not to understate costs) that the cost for switching to low emission cores is $60/msf. 

1812 

1813 Summary of Hardwood Plywood Producer Costs for Changing Raw Materials 

1814 

1815 Table 2-48 presents the estimated costs of changing raw materials for hardwood plywood product 

1816 producers under the various analytical options. Under options CI and CE there are no estimated material 

1817 costs because it is assumed that all mills can achieve CARB 1 emissions requirements with minimal 

1818 production and raw materials changes. The total costs are highest under options NI and NE because a 

1819 larger share of the production would need to switch to NAF cores. Note that the estimated cost of 

1820 switching to either the ULEF or NAF core is the same amount ($60). It is assumed that there would not be 

1821 a large difference between the cost of ULEF and NAF cores. 

1822 

Table 2-48: Estimated Costs of Raw Material Changes for Hardwood Plywood Producers, 

by Analytical Option 

Analytical 

Option 

Production 

Switching to 

PVA (msf) 

Cost of 

Switching to 

PVA 

(2010$/msf) 

Production 

Switching to 

Low Emission 

Cores (msf) 

Cost of 

Switching to 

Low Emission 

Cores 

(2010$/msf) 

Total Annual 

Cost of 

Changing Raw 

Materials 

(thousands 

2010$) 

Options SI, SE, 

SP, SCaSC, SCR, 

SEUR, SFCC, 

and SCUR a 2,300 $50 1,500 $60 $205 

Options CI and 

CE - - - - - 

Option NI and 

NEb

 699,400 $50 505,900 $60 $65,324 a

 For analytical options SI, SE, SP, SC,SCR, SEUR, SFCC, and SCRSCUR the production switching to a PVA resin was calculated as 

1/2 of the uncertified production because it was assumed that half of the uncertified product is already being produced using PVA 

resins. 

b

 For analytical options NI and NE, the production switching to a PVA resin was calculated as the sum of half of the uncertified

production share and the CARB 2 certified production share. 

This analysis uses the term “low emission cores” to mean cores with emissions low enough that hardwood plywood made from them 

meets the applicable emission standard. For the standard certification, low emission cores are assumed to include certified veneer 

core, particleboard and MDF cores certified as ULEF under the CARB ATCM, and particleboard and MDF cores certified as NAF. 

For analytical options requiring all products to meet NAF emission levels, low emission cores would include particleboard, MDF and 

veneer cores certified as NAF. 

Option SCRSCUR is the proposed option. 

1823 

1824 2.3.1.2 MDF Producers Production Processes and Raw Materials Costs 

1825 

1826 This section presents the estimated costs to MDF producers that are not compliant with a 

1827 specified emission standard in the baseline for making the changes to production processes and raw 

 23 The price and availability of NAF platforms may improve over time as the market adjusts to the CARB rule and TSCA 

Title VI. 
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May 1, 2013 2-81 

1828 materials that would be necessary to achieve that standard. First the number of mills and the volume of 

1829 production where changes to production processes and raw materials would be necessary are estimated. 

1830 Then the estimated increases in production and raw material costs to MDF producers are presented. 

1831 

1832 Number of MDF Mills and Affected Production Volume 

1833 

1834 The MDF market is still recovering from a significant slump that began in 2008. According to 

1835 RISI (2011d), MDF consumption was 2,350 million square feet (mmsf) in 2010 and is forecast to increase 

1836 1.8 percent in 2011 to 2,390 mmsf and a further 9.7 percent to 2,620 mmsf in 2012. Since the rule is 

1837 scheduled to be implemented in 2013 this analysis uses the RISI (2011d) value for 2012, the final year in 

1838 the forecast, to estimate the affected domestic MDF production. To estimate U.S. production, the 

1839 consumption figure is reduced to account for the 37 percent of domestic consumption that is attributable 

1840 to imports according to RISI’s (2011d) forecast share of MDF consumption from imports for 2011. The 

1841 resulting estimate of U.S. production utilized in this analysis is 1,850 mmsf. 

1842 

1843 Table 2-49 presents the estimated production affected for each analytical option. These results 

1844 are estimated by combining the production estimates described above and the emissions standards and 

1845 levels reported by mills in EPA’s (2010a) Pressed Wood Manufacturing Industry Survey (PWMIS). EPA 

1846 administered this survey between June and October 2010 to domestic producers of composite wood 

1847 panels. The survey achieved a response from all 20 MDF mills that received the survey (there are 22 

domestic MDF mills).24 1848 The survey asked about current emissions levels and about planned levels. Since 

1849 many composite wood product mills arewere in the midst of modifying their production technology and 

1850 raw materials to achieve compliance with Phase 2 of the CARB ATCM, current when they completed the 

1851 questionnaire, using data on their emission levels at the time they responded to the survey would not 

1852 accurately reflect the 2013 baseline emissions levels. Therefore. Instead, baseline emission levels are 

1853 estimated using responses to a question in the survey about the emissions levels mills planned to achieve 

1854 within the next three years. of when they completed the survey (i.e., three years from 2010). These 

1855 emissions levels were weighted by the production levels the mills reported in the survey, in order to 

1856 estimate the average emission levels by certification standard. The survey data were also used to estimate 

1857 the share of total production volume represented by products meeting each of the emissions standards. 

1858 

1859 Note that all mills reported that they planned to manufacture only CARB certified products. 

1860 Thus, their production costs would only be affected under the analytical option where NAF resins were 

1861 required. According to CARB’s list of certified mills, 22 mills are CARB certified, including 7 certified 

1862 to produce NAF MDF. Of the 7 mills that are NAF certified, 2 are also certified to produce CARB 2 

1863 product manufactured using resins with added-formaldehyde. 

1864 

 24 One mill was not included in the sample because it was brand new and a second MDF mill was not identified until after 

the survey was conducted. Both mills are CARB 2 certified. The number of mills for each product type is limited to 

those that are subject to the TSCA Title VI emission standards, and does not include mills that only produce products 

that are exempted or not otherwise covered by TSCA Title VI (such as curved plywood, wood packaging, and molded 

products that do not qualify as panels). The response rate includes mills that only responded to a brief phone 

questionnaire during which information was collected about the compliance standards being achieved, but not the 

specific emissions levels. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-82 

Table 2-49: MDF Production Affected By Analytical Option (mmsf)

Baseline Emission 

Standard 

Production 

Share 

Production 

Level 

Affected Production 

Options SI, 

SE, SP, SC, 

SCR, SEUR, 

SFCC, and 

SCRSCUR

Options CI 

and CE 

Options NI 

and NE 

CARB Phase 2 86.10% 1,593 - - 1,593 

CARB ULEF 4.60% 85 - - 85 

CARB NAF 9.30% 172 - - - 

Total 100% 1,850 - - 1,678 

Option SCRSCUR is the proposed option. 

Sources: U.S. Environmental Protection Agency 2010a and RISI 2011d

1865 

1866 

1867 Estimated Costs for Changing Production Processes and Raw Materials 

1868 

1869 This analysis assumes that producing NAF MDF is 20 percent more expensive than CARB 2 

MDF, or about $110 per msf.25 1870 

1871 

Table 2-50: Incremental Increase in Production Costs for MDF By Analytical Option

Baseline Emission 

Standard 

Affected Production (mmsf) Incremental Increase in Production Costs (millions, 

2010$) 

Options SI, 

SE, SP, SC, 

SCR, 

SEUR, 

SFCC, and 

SCRSCUR

Options 

CI and CE 

Options 

NI and NE 

Options SI, SE, 

SP, SC, SCR, 

SEUR, SFCC, 

and SCR

SCUR ($0/msf)

Options CI 

and CE 

($0/msf) 

Options NI and NE 

($110/msf) 

CARB Phase 2 - - 1,593 - - $175 

CARB ULEF - - 85 - - $9 

CARB NAF - - - - - - 

Total - - 1,678 - - $185 

Option SCRSCUR is the proposed option. 

Sources: U.S. Environmental Protection Agency 2010a and RISI 2011d

1872 

1873 

1874 2.3.1.3 Costs of Changes to Production Processes and Raw Materials for Particleboard Producers 

1875 

1876 This section presents the estimated costs to particleboard producers that are not compliant with a 

1877 specified emission standard in the baseline for making the changes to production processes and raw 

1878 materials that would be necessary to achieve that standard. First the number of mills and the volume of 

1879 production where changes to production processes and raw materials would be necessary are estimated. 

1880 Then the estimated increases in production and raw material costs to particleboard producers are 

1881 presented. 

1882 

1883 

 25The analysis assumes that NAF MDF is 20 percent more expensive. The MDF price was estimated based on prices of 

about $567 and $523 msf for the West and East United States, respectively, from the RISI (2011) MDF forecast for 

March 2012, the final month included. Twenty percent of the average of these two prices is about $110 msf. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-83 

1884 Number of Particleboard Mills and Affected Production Volume 

1885 

1886 The particleboard market is still recovering from a significant slump that began in 2008. 

1887 According to RISI (2011d), particleboard consumption was 2,570 million square feet (mmsf) in 2010 and 

1888 is forecast to increase 3.3 percent in 2011 to 2,650 mmsf and a further 10.3 percent to 2,930 mmsf in 

1889 2012. Since the rule is scheduled to be implemented in 2013 this analysis uses the RISI (2011d) estimate 

1890 for 2012 to estimate the affected domestic particleboard production, which is the final year included in 

1891 RISI’s (2011d) forecast. To estimate U.S. production, the consumption figure is reduced to account for 

1892 the 15 percent of domestic consumption that is attributable to imports according to RISI’s (2011d) 

1893 forecast of particleboard consumption from imports for 2011. The resulting estimate of U.S. production 

1894 which is used in this analysis is 2,490 mmsf. 

1895 

1896 Table 2-51 presents the estimated production affected for each analytical option. These results 

1897 are estimated by combining the production estimates described above and the emissions standards and 

1898 levels reported by mills in EPA’s (2010a) Pressed Wood Manufacturing Industry Survey (PWMIS). EPA 

1899 administered this survey between June and October 2010 to domestic producers of composite wood 

1900 panels. The survey achieved a response from all 30 particleboard mills that were identified as operating 

in the U.S.26 1901 The survey asked about current emissions levels and about planned levels. Since many 

1902 composite wood product mills arewere in the midst of modifying their production technology and raw 

1903 materials to achieve compliance with Phase 2 of the CARB ATCM, current when they completed the 

1904 questionnaire, using data on their emission levels at the time they responded to the survey would not 

1905 accurately reflect the 2013 baseline emissions levels. Therefore. Instead, baseline emission levels are 

1906 estimated using responses to a question in the survey about the emissions levels mills planned to achieve 

1907 within the next three years. of when they completed the survey (i.e., three years from 2010). These 

1908 emissions levels were weighted by the production levels the mills reported in the survey, in order to 

1909 estimate the average emission levels by certification standard. The survey data were also used to estimate 

1910 the share of total production volume represented by products meeting each of the emissions standards. 

1911 

1912 Note that the mills that reported manufacturing product that was not CARB certified also reported 

1913 that they planned to manufacture product that met the CARB 2 emissions requirements. That is, they 

1914 reported that it was not worthwhile for them to pay for testing and third party certification even though 

1915 their products are being manufactured to meet the emissions standards. Thus, their production costs would 

1916 only be affected under the analytical option where NAF resins were required. 

1917 

 26 The number of mills for each product type is limited to those that are subject to the TSCA Title VI emission standards, 

and does not include mills that only produce products that are exempted or not otherwise covered by TSCA Title VI 

(such as curved plywood, wood packaging, and molded products that do not qualify as panels). The response rate 

includes mills that only responded to a brief phone questionnaire during which information was collected about the 

compliance standards being achieved, but not the specific emissions levels. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-84 

Table 2-51: Particleboard Production Affected By Analytical Option (mmsf)

Baseline Emission 

Standard 

Production 

Share 

Production 

Level 

Affected Production 

Options SI, SE, 

SP, SC, SCR, 

SEUR, SFCC, 

and SCRSCUR

Options CI and 

CE 

Options NI and 

NE 

None a 0.2% 5 - - 5 

CARB Phase 1b 1.8% 45 45 - 45 

CARB Phase 2 88.5% 2,204 - - 2,204 

CARB ULEF 2.8% 70 - - 70 

CARB NAF 6.7% 167 - - - 

Total 100% 2,490 45 - 2,323324

a Note that mills reporting manufacturing product that was not CARB certified were meeting the CARB 2 emissions 

levels, which explains why production is only affected under Option NAF.

b Some mills producing product currently certified under CARB 1 reported that they would continue this product line 

after the CARB 2 effective date (although it would no longer be certified as CARB 1). 

Option SCRSCUR is the proposed option. 

Sources: RISI 2011a, d, U.S. Environmental Protection Agency 2010a

1918 

1919 Industry market reports indicate that panels that are not CARB 2 certified are generally not 

1920 available (RISI 2011), implying that few mills are offering product that is not CARB 2 certified. The 

1921 analysis assumes that between 10 and 25 percent of the 30 U.S. mills, or between 3 and 7 mills, are 

1922 offering product that is not CARB certified and uses the midpoint number of 5 mills for estimating the 

1923 cost impacts 

1924 

1925 According to CARB’s list of certified mills, four mills are certified to produce NAF particleboard 

1926 – two of these mills are certified to produce both CARB 2 and CARB NAF particleboard. 

1927 

1928 Estimated Costs for Changing Production Processes and Raw Materials 

1929 

1930 This analysis estimates the increased costs for changing production processes and raw materials 

1931 to meet the more stringent emissions requirements using RISI’s (2011a) data for industrial particleboard 

1932 prices in the southeast, where RISI reported producers were more successful in passing through the higher 

1933 costs of producing CARB 2 certified particleboard. According to RISI, mills were partially successful in 

1934 passing along the higher costs in the fourth quarter of 2010, and arewere expected to be more successful 

1935 in passing along these costs in the first quarter of 2011, as almost all particleboard supply willwould be 

1936 CARB 2 certified as of 2011 (RISI 2011a, b). RISI’s (RISI 2011c) historical prices for particleboard 

1937 indicate that particleboard prices in the Southeast increased from about $315/msf to $335/msf between 

1938 October 1, 2010 and March 18, 2011, an increase of about $20/msf. RISI attributes this increase 

1939 primarily to the transition to CARB 2, and therefore this analysis will use $20/msf as the estimated 

1940 increased cost of manufacturing CARB 2 particleboard for these mills (RISI 2011a, b). 

1941 

1942 This analysis assumes that producing NAF particleboard has twice the incremental costs of 

1943 producing CARB 2 particleboard, or $20/msf to transition from CARB 2 to CARB NAF and $40/msf to 

1944 switch from production that does not meet CARB 2 emissions standards to CARB NAF production. 

1945 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-85 

Table 2-52: Incremental Increase in Production Costs for Particleboard By Analytical Option

Baseline 

Emissions 

Standard 

Affected Production (mmsf) Incremental Increase in Production Costs 

(millions, 2010$) 

Options SI, 

SE, SP, SC, 

SCR, SEUR, 

SFCC, and 

SCRSCUR

Options CI 

and CE 

Options NI 

and NE 

Options SI, 

SE, SP, SC, 

SCR, SEUR, 

SFCC, and 

SCR

SCUR

($20/msf) 

Options CI 

and CE

($0/msf) 

Options NI 

and NE

($20/msf 

from CARB 

2; $40/msf 

from CARB 

1 or None) 

None a - - 5 - - $0.2 

CARB Phase 1 45 - 45 $0.9 - $1.8 

CARB Phase 2 - - 2,204 - - $44.1 

CARB ULEF - - 70 - - $1.4 

CARB NAF - - - - - - 

Total 45 - 2,323324 $0.9 - $47.5 

a Note that mills reporting manufacturing product in the “None” category for emissions standards because they were not 

certifying their production also reported that their emissions were below the Title VI emission requirements, and this is why this 

production is only affected under options NI and NE.

b Some mills producing product currently certified under CARB 1 reported that they would continue this product line after the 

CARB 2 effective date (although it would no longer be certified as CARB 1). 

Option SCRSCUR is the proposed option. 

Sources: RISI 2011a, b, U.S. Environmental Protection Agency 2010

1946 

1947 

1948 2.3.1.4 Summary of Production Process and Raw Material Costs for Composite Wood Panel 

1949 Producers 

1950 

1951 Table 2-53 presents a summary of the annualized increase in production process and raw material 

1952 costs for composite wood panel producers by analytical option. 

1953 

Table 2-53: Summary of Incremental Increase in Production Costs for Composite Panel 

Producers 

Product Type 

Incremental Increase in 

Annual Production Costs 

(millions, 2010$) 

30-Year Annualized Increase 

in Production Costs (3% 

discount rate, millions 2010$)

30-Year Annualized Increase 

in Production Costs (7% 

discount rate, millions 2010$) 

Options 

SI, SE, SP, 

SC, SCR, 

SEUR, 

SFCC, 

and 

SCRSCU

R

Options 

CI and CE 

Options 

NI and NE 

Options 

SI, SE, SP, 

SC, SCR, 

SEUR, 

SFCC, 

and 

SCRSCU

R

Options 

CI and CE

Options 

NI and NE

Options 

SI, SE, SP, 

SC, SCR, 

SEUR, 

SFCC, 

and 

SCRSCU

R

Options 

CI and CE

Options 

NI and NE 

Hardwood Plywood $0.2 - $65.3 $0.2 - $62.2 $0.2 - $60.5 

MDF - - $185.0 - - $176.0 - - $171.2 

Particleboard $0.9 - $47.5 $0.9 - $45.2 $0.8 - $43.9 

Option SCRSCUR is the proposed option. 

1954 

Formatted Table

Formatted Table

Formatted Table

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

May 1, 2013 2-86 

1955 

1956 

1957 2.3.2 Certification and Testing Costs for Composite Wood Panel Producers 

1958 

1959 Table 2-54 presents a summary of the incremental initial, subsequent year, and annualized costs 

1960 associated with testing and certification for the different analytical options under various scenarios for the 

1961 products affected. See section 2.2 for a description of how these costs were estimated. 

1962 

1963 To determine the baseline product certification status all mills were assumed to have two product 

1964 lines, and the baseline certification status of their product lines was determined by their certification status 

1965 according to CARB’s (2011b) list of certified mills and CARB’s (2011c) list of no-added formaldehyde 

1966 (NAF) and ultra low emitting formaldehyde (ULEF) exemptions. For example, if a mill only had a Phase 

1967 2 certification listed, it was assumed that they had two product lines with the standard certification. 

1968 (Standard certification refers to certification where mills are not exempt from any routine testing 

1969 requirements, i.e., not NAF or ULEF certification.) Another example is a mill that is listed as Phase 2 

1970 certified and also listed as having NAF exempt status would be assumed to have one NAF line and one 

1971 standard certification line (NAF certified mills are exempt from some routine testing requirements). The 

1972 exception to this is particleboard, where it is assumed that 5 of the 25 particleboard mills with standard 

1973 certification status also produce a product line that is not certified. Mills that certify their products as 

1974 ULEF under the CARB ATCM are exempt from some routine testing requirements under the CARB 

1975 ATCM. Under the proposed TSCA Title VI rule these ULEF exemptions will not be available so these 

1976 mills will no longer be exempt from some routine testing unless they obtain NAF certification. The 

1977 analysis assumes that mills will seek standard certification for baseline uncertified and baseline ULEF 

1978 product lines – with the exception of mills that have one product line that is ULEF certified and another 

1979 product line that is NAF certified in the baseline. These mills are assumed to seek NAF certification for 

1980 their product line that was ULEF certified in the baseline, so they will have two product lines with NAF 

1981 certification. Note that switching to NAF certification results in an estimated certification and testing cost 

1982 savings because NAF products are not required to be tested as frequently as products with other 

1983 certifications. 

1984 

1985 Under the CARB ATCM mills may ship panels from certified product lines before test results are 

1986 available, but under the proposed rule they would have to wait until test results indicate that the emissions 

1987 standards have been met before shipping a lot that has been tested. MDF and particleboard mills are all 

1988 assumed to conduct daily quality control testing on site, so this requirement is not expected to adversely 

1989 affect these mills. (Once a quarter these mills will also have to store lots for which a sample has been sent 

1990 to a TPC for large chamber testing until the test results indicate that the emissions standards have been 

1991 met for the lot that has been tested.) However, CARB certified hardwood plywood mills are assumed to 

1992 outsource quality control testing to their TPC. It is uncertain how often hardwood plywood mills ship 

1993 product from a lot being tested before the test results are available and therefore it is uncertain how mills 

1994 will choose to comply with this requirement. It may be the case that some mills normally maintain a level 

1995 of inventory where they would typically not ship any panels before test results have been determined for 

1996 that lot, but other mills may ship out panels on the same day they are produced. This analysis estimates 

1997 the costs of this requirement as the incremental cost of installing a lab on site and conducting daily quality 

1998 control testing rather than outsourcing weekly quality control testing to a TPC. (Once a quarter these 

1999 mills will also have to store lots for which a sample has been sent to a TPC for large chamber testing until 

2000 the test results indicate that the emissions standards have been met for the lot that has been tested.) 

2001 Assuming that mills conduct daily on-site testing may overstate the costs of this requirement if some mills 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-87 

2002 find it more cost effective to hold products in inventory until test results have been determined by an 

2003 outside lab. 

2004 

2005 To be comparable with the benefits estimates, which were estimated for 30 year period, all costs 

2006 were annualized over a 30 year period. The results presented in Table 2-55 are calculated by multiplying 

2007 the number of affected entities by the corresponding cost increase or savings presented in Table 2-54. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-88 

2008 

Table 2-54: Per Mill Costs for Certifying and Testing Products, by change in product line certification 2010$) 

Analytical 

Option Product Type Baseline Product Lines (CARB ATCM certification) Post-Rule Product Lines (TSCA Title VI certification) First Year Costs Subsequent Year Costs 

30-Year Annualized 

Costs (Annualized 

over 30 Years Using

3 Percent Discount 

Rate 

3 Percent 7 Percent

SI, SE, SP, 

SC, and 

SCR 

Hardwood Plywood 2 prod. with standard cert. 2 prod. with standard cert. $14,097 

10,832

$14,097 

832

$13,413 

1,263

$13,046 

1,467

Hardwood Plywood 2 prod. without cert. 2 prod. with NAF cert. $42,015 $7,062 $8,367 $8,972Particleboard 1 prod. without cert.; 1 prod. with standard cert. 2 prod. with standard cert. $7,305 

5,185 $4,485 $4,401 301 $4,347 200

Hardwood Plywood 2 prod. with ULEF cert. 2 prod. with standard cert. $62,124 $52,124 $50,065 $48,934MDF 2 prod. with ULEF cert. 2 prod. with standard cert. $48,630 $48,630 $46,269 $45,003Particleboard 2 prod. with ULEF cert. 2 prod. with standard cert. $48,630 $48,630 $46,269 $45,003Hardwood Plywood 1 prod. with NAF cert.; 1 prod. with ULEF cert. 2 prod. with standardNAF

cert. 

$22,501 

23,128

($1,958974

) ($710695) ($10777)

MDF 1 prod. with NAF cert.; 1 prod. with ULEF cert. 2 prod. with standardNAF cert. 

$12,693 

13,321 ($1,938) ($1,15412

5) ($774730)

SFCC Hardwood Plywood 2 prod. without cert. 2 prod. with NAF cert. $33,460 $7,062 $7,964 $8,376 

Particleboard 1 prod. without cert.; 1 prod. with standard cert. 2 prod. with standard cert. $5,185 $4,485 $4,301 $4,200 

SEUR, 

SFCC, and 

SCUR

Hardwood Plywood 2 prod. with standard cert. 2 prod. with standard cert. $10,832 $832 $1,263 $1,467 Hardwood Plywood 2 prod. without cert. 2 prod. with NAF cert. $42,015 $7,062 $8,367 $8,972Particleboard 1 prod. without cert.; 1 prod. with standard cert. 2 prod. with standard cert. $5,185 $4,485 $4,301 $4,200 

CI and CE Hardwood Plywood 2 prod. without cert. 2 prod. with standard cert. $81,614 $62,782 $60,622 $59,412 Particleboard 1 prod. without cert.; 1 prod. with standard cert. 2 prod. with standard cert. $7,3055,185 $4,485 $4,401301 $4,347200

NI and NE Hardwood Plywood 2 prod. without cert. 2 prod. with NAF cert. $42,015 $7,062 $8,367 $8,972 Particleboard 1 prod. without cert.; 1 prod. with standard cert. 2 prod. with NAF cert. ($26,827) ($47,699) ($44,400) ($42,687)
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-89 

Hardwood Plywood 2 prod. with ULEF cert. 2 prod. with NAF cert. $2325,918 ($3,595) ($2,12403

0)

($1,40927

0)

MDF 2 prod. with ULEF cert. 2 prod. with NAF cert. $15,017 ($3,555) ($2,507) ($1,995)Particleboard 2 prod. with ULEF cert. 2 prod. with NAF cert. $15,017 ($3,555) ($2,507) ($1,995)Hardwood Plywood 2 prod. with standard cert. 2 prod. with NAF cert. ($23,074) ($54,887) ($50,723) ($48,577)MDF 2 prod. with standard cert. 2 prod. with NAF cert. ($31,312) ($52,184) ($48,668) ($46,838)Particleboard 2 prod. with standard cert. 2 prod. with NAF cert. ($31,312) ($52,184) ($48,668) ($46,838)Hardwood Plywood 1 prod. with NAF cert.; 1 prod. with ULEF cert. 2 prod. with NAF cert. $22,50123,128 ($1,958974) ($710695) ($10777)MDF 1 prod. with NAF cert.; 1 prod. with ULEF cert. 2 prod. with NAF cert. $12,69313,321 ($1,938) ($1,15412

5) ($774730)

MDF 1 prod. with standard cert.; 1 prod. with NAF cert. 2 prod. with NAF cert. ($31,306) ($48,238) ($45,098) ($43,460)Particleboard 1 prod. with standard cert.; 1 prod. with NAF cert. 2 prod. with NAF cert. ($31,306) ($48,238) ($45,098) ($43,460)

Note: Numbers in parentheses represent cost savings. Standard certification refers to certification where mills are not exempt from any ongoing testing requirements (i.e., not ULEF or NAF certification). NAF certification refers to mills that are certifying their products as NAF; these mills will be exempt from some of the routine testing requirements. ULEF certification is available under the CARB ATCM and ULEF certified mills are exempthave reductions or exemptions from some of the routine testing requirements under the CARB ATCM. Option SCRSCUR is the proposed option. 

2009 2010 

Table 2-55: Annualized Costs for Certifying and Testing Products, by analytical option and number of affected mills (thousands, 2010$) 

Analytical 

Option Product Type Baseline Product Lines (CARB ATCM certification) Post-Rule Product Lines (TSCA Title VI certification) Number of Affected Firms Number of Affected Mills 

30-Year Annualized Costs 

(Annualized over 30 Years Using 3 

Percent Discount Rate 

3 Percent 7 Percent 

SI, SE, SP, 

SC, and 

SCR 

Hardwood Plywood 2 prod. with standard cert. 2 prod. with standard cert. 8 10 $13413 $13015Hardwood Plywood 2 prod. without cert. 2 prod. with NAF cert. 9 11 $92 $99 Particleboard 1 prod. without cert.; 1 prod. with standard cert. 2 prod. with standard cert. 3 5 $22 $2221Hardwood Plywood 2 prod. with ULEF cert. 2 prod. with standard cert. 6 8 $401 $391 MDF 2 prod. with ULEF cert. 2 prod. with standard cert. 1 2 $93 $90 Particleboard 2 prod. with ULEF cert. 2 prod. with standard cert. 1 1 $46 $45 Hardwood Plywood 1 prod. with NAF cert.; 1 prod. with ULEF cert. 2 prod. with standardNAF

cert. 4 5 ($43) ($10) 

MDF 1 prod. with NAF cert.; 1 prod. with ULEF cert. 2 prod. with standardNAF cert. 1 1 ($1) ($1) 

Total $783661 $776660

SFCC

Hardwood Plywood 2 prod. without cert. 2 prod. with NAF cert. 9 11 $88 $92 Particleboard 1 prod. without cert.; 1 prod. with standard cert. 2 prod. with standard cert. 3 5 $22 $21 

Total $109 $113 

SEUR, 

SFCC, and 

SCUR

Hardwood Plywood 2 prod. with standard cert. 2 prod. with standard cert. 8 10 $13 $15 Hardwood Plywood 2 prod. without cert. 2 prod. with NAF cert. 9 11 $92 $99 Particleboard 1 prod. without cert.; 1 prod. with standard cert. 2 prod. with standard cert. 3 5 $22 $21 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-90 

2011 

Total $126 $134 

CI and CE 

Hardwood Plywood 2 prod. without cert. 2 prod. with standard cert. 9 11 $667 $654 Particleboard 1 prod. without cert.; 1 prod. with standard cert. 2 prod. with standard cert. 3 5 $22 $2221

Total $689688 $675 

NI and NE

Hardwood Plywood 2 prod. without cert. 2 prod. with NAF cert. 9 11 $92 $99 Particleboard 1 prod. without cert.; 1 prod. with standard cert. 2 prod. with NAF cert. 3 5 ($222) ($213) Hardwood Plywood 2 prod. with ULEF cert. 2 prod. with NAF cert. 6 8 ($1716) ($1110) MDF 2 prod. with ULEF cert. 2 prod. with NAF cert. 1 2 ($5) ($4) Particleboard 2 prod. with ULEF cert. 2 prod. with NAF cert. 1 1 ($3) ($2) Hardwood Plywood 2 prod. with standard cert. 2 prod. with NAF cert. 8 10 ($507) ($486) MDF 2 prod. with standard cert. 2 prod. with NAF cert. 8 13 ($633) ($609) Particleboard 2 prod. with standard cert. 2 prod. with NAF cert. 11 20 ($973) ($937) Hardwood Plywood 1 prod. with NAF cert.; 1 prod. with ULEF cert. 2 prod. with NAF cert. 4 5 ($43) ($10) MDF 1 prod. with NAF cert.; 1 prod. with ULEF cert. 2 prod. with NAF cert. 1 1 ($1) ($1) MDF 1 prod. with standard cert.; 1 prod. with NAF cert. 2 prod. with NAF cert. 1 1 ($45) ($43) Particleboard 1 prod. with standard cert.; 1 prod. with NAF cert. 2 prod. with NAF cert. 1 2 ($90) ($87) 

Total ($2,408407) ($2,295294) 

Note: Numbers in parentheses represent cost savings. Standard certification refers to certification where mills are not exempt from any ongoing testing requirements (i.e., not ULEF or NAF certification). NAF certification refers to mills that are certifying their products as NAF; these mills will be exempt from some of the routine testing requirements. ULEF certification is available under the CARB ATCM and ULEF certified mills are exempthave reductions or exemptions from some of the routine testing requirements under the CARB ATCM. Option SCRSCUR is the proposed option. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-91 

2012 2.3.3 Total Costs for Composite Panel Producers 

2013 

2014 The incremental costs associated with changing production processes and raw materials presented 

2015 in Table 2-48, Table 2-50, and Table 2-52 are combined with the certification and testing costs presented 

2016 in Table 2-54 and Table 2-55 to estimate the total first and subsequent year costs presented in Table 2-56 

2017 and the 30-year annualized costs presented in Table 2-57. Note that the production process and raw 

2018 material costs presented in Table 2-48, Table 2-50, and Table 2-52 are assumed to be equally distributed 

2019 across the mills incurring these costs to calculate the estimates presented in Table 2-56 and Table 2-57. 

2020 

2021 

2022 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-92 Table 2-56: Total First and Subsequent Year Costs for Composite Panel Producers, by analytical option and number of affected mills (thousands, 2010$) 

Analytical 

Option Product Type Baseline Product Lines (CARB ATCM certification) Post-Rule Product Lines (TSCA Title VI certification) Number of Affected Firms Number of Affected Mills Total Costs First Year Subsequent Years 

SI, SE, SP, 

SC, and 

SCR 

Hardwood Plywood 2 prod. with standard cert. 2 prod. with standard cert. 8 10 $141108 $1418Hardwood Plywood 2 prod. without cert. 2 prod. with NAF cert. 9 11 $667 $283 Particleboard 1 prod. without cert.; 1 prod. with standard cert. 2 prod. with standard cert. 3 5 $937926 $922 Hardwood Plywood 2 prod. with ULEF cert. 2 prod. with standard cert. 6 8 $497 $417 MDF 2 prod. with ULEF cert. 2 prod. with standard cert. 1 2 $97 $97 Particleboard 2 prod. with ULEF cert. 2 prod. with standard cert. 1 1 $49 $49 Hardwood Plywood 1 prod. with NAF cert.; 1 prod. with ULEF cert. 2 prod. with standardNAF cert. 4 5 $113116 ($10) MDF 1 prod. with NAF cert.; 1 prod. with ULEF cert. 2 prod. with standardNAF cert. 1 1 $13 ($2) 

Total $2,513473 $1,897765

SFCC

Hardwood Plywood 2 prod. without cert. 2 prod. with NAF cert. 9 11 $573 $283 Particleboard 1 prod. without cert.; 1 prod. with standard cert. 2 prod. with standard cert. 3 5 $926 $922 

Total $1,499 $1,205 

SEUR, 

SFCC, and

SCUR

Hardwood Plywood 2 prod. with standard cert. 2 prod. with standard cert. 8 10 $108 $8 Hardwood Plywood 2 prod. without cert. 2 prod. with NAF cert. 9 11 $667 $283 Particleboard 1 prod. without cert.; 1 prod. with standard cert. 2 prod. with standard cert. 3 5 $926 $922 

Total $1,701 $1,213 

CI and CE 

Hardwood Plywood 2 prod. without cert. 2 prod. with standard cert. 9 11 $898 $691 Particleboard 1 prod. without cert.; 1 prod. with standard cert. 2 prod. with standard cert. 3 5 $3726 $22 

Total $934924 $713 

NI and NE Hardwood Plywood 2 prod. without cert. 2 prod. with NAF cert. 9 11 $21,596 $21,212 Particleboard 1 prod. without cert.; 1 prod. with standard cert. 2 prod. with NAF cert. 3 5 $8,344 $8,240 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-93 Table 2-56: Total First and Subsequent Year Costs for Composite Panel Producers, by analytical option and number of affected mills (thousands, 2010$) 

Analytical 

Option Product Type Baseline Product Lines (CARB ATCM certification) Post-Rule Product Lines (TSCA Title VI certification) Number of Affected Firms Number of Affected Mills Total Costs First Year Subsequent Years 

Hardwood Plywood 2 prod. with ULEF cert. 2 prod. with NAF cert. 6 8 $15,562578 $15,342 MDF 2 prod. with ULEF cert. 2 prod. with NAF cert. 1 2 $21,795 $21,758 Particleboard 2 prod. with ULEF cert. 2 prod. with NAF cert. 1 1 $1,711 $1,692 Hardwood Plywood 2 prod. with standard cert. 2 prod. with NAF cert. 8 10 $18,982 $18,664 MDF 2 prod. with standard cert. 2 prod. with NAF cert. 8 13 $141,064 $140,792 Particleboard 2 prod. with standard cert. 2 prod. with NAF cert. 11 20 $33,288 $32,871 Hardwood Plywood 1 prod. with NAF cert.; 1 prod. with ULEF cert. 2 prod. with NAF cert. 4 5 $9,719722 $9,597 MDF 1 prod. with NAF cert.; 1 prod. with ULEF cert. 2 prod. with NAF cert. 1 1 $10,895896 $10,880 MDF 1 prod. with standard cert.; 1 prod. with NAF cert. 2 prod. with NAF cert. 1 1 $10,851 $10,834 Particleboard 1 prod. with standard cert.; 1 prod. with NAF cert. 2 prod. with NAF cert. 1 2 $3,329 $3,295 

Total $297,136155 $295,176 

Note: Numbers in parentheses represent cost savings. Standard certification refers to certification where mills are not exempt from any ongoing testing requirements (i.e., not ULEF or NAF certification). NAF certification refers to mills that are certifying their products as NAF; these mills will be exempt from some of the routine testing requirements. ULEF certification is available under the CARB ATCM and ULEF certified mills are exempthave reductions or exemptions from some of the routine testing requirements under the CARB ATCM. Option SCRSCUR is the proposed option. 

2023 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-94 Table 2-57: Total Annualized Costs for Composite Panel Producers, by analytical option and number of affected mills (thousands,2010$) 

Analytical 

Option Product Type Baseline Product Lines (CARB ATCM certification) Post-Rule Product Lines (TSCA Title VI certification) Number of Affected Firms Number of Affected Mills 

30-Year Annualized 

Costs (Annualized over 

30 Years Using 3 Percent 

Discount Rate 

3 Percent 7 Percent 

SI, SE, SP, 

SC, and 

SCR 

Hardwood Plywood 2 prod. with standard cert. 2 prod. with standard cert. 8 10 $13413 $13015Hardwood Plywood 2 prod. without cert. 2 prod. with NAF cert. 9 11 $287 $288 Particleboard 1 prod. without cert.; 1 prod. with standard cert. 2 prod. with standard cert. 3 5 $878 $855854Hardwood Plywood 2 prod. with ULEF cert. 2 prod. with standard cert. 6 8 $401 $391 MDF 2 prod. with ULEF cert. 2 prod. with standard cert. 1 2 $93 $90 Particleboard 2 prod. with ULEF cert. 2 prod. with standard cert. 1 1 $46 $45 Hardwood Plywood 1 prod. with NAF cert.; 1 prod. with ULEF cert. 2 prod. with standardNAF cert. 4 5 ($43) ($10)MDF 1 prod. with NAF cert.; 1 prod. with ULEF cert. 2 prod. with standardNAF cert. 1 1 ($1) ($1)

Total $1,834712 $1,799682

SFCC

Hardwood Plywood 2 prod. without cert. 2 prod. with NAF cert. 9 11 $283 $282 Particleboard 1 prod. without cert.; 1 prod. with standard cert. 2 prod. with standard cert. 3 5 $878 $854 

Total $1,160 $1,136 

SEUR, 

SFCC, and 

SCUR

Hardwood Plywood 2 prod. with standard cert. 2 prod. with standard cert. 8 10 $13 $15 Hardwood Plywood 2 prod. without cert. 2 prod. with NAF cert. 9 11 $287 $288 Particleboard 1 prod. without cert.; 1 prod. with standard cert. 2 prod. with standard cert. 3 5 $878 $854 

Total $1,178 $1,157 

CI and CE 

Hardwood Plywood 2 prod. without cert. 2 prod. with standard cert. 9 11 $667 $654 Particleboard 1 prod. without cert.; 1 prod. with standard cert. 2 prod. with standard cert. 3 5 $22 $2221

Total $689688 $675 

NI and NE

Hardwood Plywood 2 prod. without cert. 2 prod. with NAF cert. 9 11 $20,200 $19,657 Particleboard 1 prod. without cert.; 1 prod. with standard cert. 2 prod. with NAF cert. 3 5 $7,845 $7,633 Hardwood Plywood 2 prod. with ULEF cert. 2 prod. with NAF cert. 6 8 $14,607608 $14,213214MDF 2 prod. with ULEF cert. 2 prod. with NAF cert. 1 2 $20,703 $20,138 Particleboard 2 prod. with ULEF cert. 2 prod. with NAF cert. 1 1 $1,611 $1,567 Hardwood Plywood 2 prod. with standard cert. 2 prod. with NAF cert. 8 10 $17,773 $17,294 MDF 2 prod. with standard cert. 2 prod. with NAF cert. 8 13 $133,971 $130,311 Particleboard 2 prod. with standard cert. 2 prod. with NAF cert. 11 20 $31,295 $30,448 Hardwood Plywood 1 prod. with NAF cert.; 1 prod. with ULEF cert. 2 prod. with NAF cert. 4 5 $9,137 $8,890 MDF 1 prod. with NAF cert.; 1 prod. with ULEF cert. 2 prod. with NAF cert. 1 1 $10,353 $10,070 MDF 1 prod. with standard cert.; 1 prod. with NAF cert. 2 prod. with NAF cert. 1 1 $10,309 $10,027 Particleboard 1 prod. with standard cert.; 1 prod. with NAF cert. 2 prod. with NAF cert. 1 2 $3,137 $3,052 

Total $280,940941 $273,300301

Note: Numbers in parentheses represent cost savings. Option SCRSCUR is the proposed option. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-95 

2024 2.4 Estimated Costs for Wood Veneer Laminated Product Producers 

2025 

2026 This section presents the estimated costs to wood veneer laminated product producers under 

2027 several analytical options. For this analysis a wood veneer laminated product is defined as a product 

2028 made by gluing a wood or woody grass veneer to the face and/or back of a purchased platform to produce 

a finished product or component part (other than a stock hardwood plywood panel).27 2029 Wood veneer 

2030 laminated product producers are considered composite wood product fabricators rather than hardwood 

2031 plywood manufacturers under the CARB ATCM, and they are not required to meet the ATCM’s 

2032 emissions standards. 

2033 

2034 TSCA Title VI includes laminated products in the definition of hardwood plywood, and directs 

2035 EPA to conduct a rulemaking process to determine whether to exempt any of these products from the 

2036 definition. If EPA does not exempt laminated products from the definition of hardwood plywood, then 

2037 laminated products will have to meet TSCA Title VI’s emissions standards (in addition to being made 

2038 with certified platforms). 

2039 

2040 The estimated number of companies making wood veneer laminated products was presented 

2041 above in Section 2.1.2. Section 2.3.1 presents the estimated costs to wood veneer laminated product 

2042 producers for making changes to raw materials. Section 2.4.2 presents the estimated costs of testing and 

2043 third party certification for wood veneer laminated product producers. Finally, the total estimated costs 

2044 for wood veneer laminated product producers are presented in section 2.4.3. 

2045 

2046 2.4.1 Costs of Changes to Raw Materials for Wood Veneer Laminated Product 

2047 Producers 

2048 

2049 This section presents the estimated costs to wood veneer laminated product producers for making 

2050 changes to raw materials. These costs are estimated as the costs of switching face resins from UF to PVA 

2051 resin systems and switching from conventional to lower emitting platforms. 

2052 

2053 Because the emissions standard for hardwood plywood (0.05 ppm) is lower than the standards for 

2054 particleboard (0.09 ppm) and MDF (0.11 to 0.13 ppm), wood veneer laminated products included in the 

2055 definition of hardwood plywood could conceivably exceed the emission standard even if a NAF resin 

2056 such as PVA was used to affix the veneer to a certified particleboard or MDF platform. (Whether this 

2057 occurs in practice depends on how effectively the veneer acts as a barrier to the release of formaldehyde, 

2058 and how far below the standards the actual emissions from the platform are.) 

2059 

2060 This analysis uses the term “low emission platforms” to mean platforms with emissions low 

2061 enough that wood veneer laminated products made from them meets the applicable hardwood plywood 

2062 emission standard. For the standard certification, low emission platforms are assumed to include certified 

2063 veneer platforms, particleboard and MDF platforms certified as ULEF under the CARB ATCM, and 

2064 particleboard and MDF platforms certified as NAF. For analytical options requiring wood veneer 

2065 laminated products to meet NAF emission levels, low emission platforms would include particleboard, 

2066 MDF and veneer platforms certified as NAF. 

2067 

2068 Wood veneer laminated product producers switching from UF to PVA face resins and purchasing 

2069 low emission platforms would not need to make any significant modifications or upgrades to existing 

2070 equipment or processes because PVA resins are generally a “drop-in” technology for plants currently 

2071 using UF face resins. Thus, the estimated raw material costs are only for purchasing the more expensive 

 27 The laminated products discussed here do not include products that are solely laminated with materials other than 

veneer, such as high pressure laminate, thermally fused paper, vinyl film, decorative foil, or polypropylene film. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-96 

2072 face resins and platforms. Note that switching to PVA face resins is just one possibility for achieving 

2073 compliance. Some producers may achieve compliance by using enhanced urea formaldehyde resins, 

2074 melamine-urea-formaldehyde (MUF) resins, soy-based resins, or other resin systems. However, the cost 

2075 of switching to PVA resins can provide a reasonable approximation for the compliance cost associated 

2076 with changing raw materials and production processes and therefore is the basis for the cost estimates in 

2077 this analysis. 

2078 

2079 Section 2.4.1.1 presents the estimated production of wood veneer laminated products. This 

2080 information is used to estimate the increase in raw material costs as a result of the proposed rule. Section 

2081 2.4.1.2 presents the estimated raw material costs to wood veneer laminated product producers by 

2082 analytical option. 

2083 

2084 2.4.1.1 Wood Veneer Laminated Product Production Volume 

2085 

2086 This analysis estimates the production volume of wood veneer laminated product producers 

2087 separately for the following primary categories of wood veneer laminated product producers listed below: 

2088 

2089  Custom Panel Producers 

2090  Engineered Wood Flooring Producers 

2091  Composite Wood Product Fabricators 

2092  Cabinet Manufacturers 

2093  Household Furniture Manufacturers 

2094  Office and Institutional Furniture Manufacturers 

2095  Window and Door Manufacturers 

2096  Architectural Woodwork and Millwork Manufacturers 

2097 

2098 Custom Panel Manufacturers 

2099 

2100 Custom panel producers are defined here as producers that make custom hardwood plywood 

2101 panels to order by affixing veneer to purchased platforms. They make hundreds of different combinations 

2102 of platform types (particleboard, MDF, veneer-core), platform characteristics (e.g., moisture resistance, 

2103 fire resistance, density, other mechanical properties, and formaldehyde emissions), platform thickness, 

2104 species of veneer, etc. A firm might use more than a dozen different types of particleboard and MDF 

2105 platforms (not counting differences in thickness, size, density, etc.), and a much larger number of 

2106 different types of veneer-core platforms. The specific characteristics of each order are determined by the 

2107 customer. Custom panel producers might make as little as four or five sheets of a given product, and can 

2108 make dozens or even hundreds of different combinations of platform type, thickness, and veneer species 

2109 in a single day. They often manufacture and ship a product within a few days of receiving an order. 

2110 Custom panel producers are generally small businesses. 

2111 

2112 Consultations with industry members indicate that there are about 50 custom panel producers, 

2113 although estimates ranged from 20 to 100. Industry members estimated that the typical production 

2114 volume for these producers ranges from less than 1 million to 15 million square feet (mmsf) per year, 

2115 with the production of most producers falling near the lower end of this range. Therefore, it is assumed 

2116 that average mill production volume is 2 mmsf on a 5/8” basis, resulting in an estimate that total 

2117 production volume by custom panel producers is 100 mmsf per year on a 5/8” basis. 

2118 

2119 

2120 

2121 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-97 

2122 Engineered Wood Flooring Producers 

2123 

2124 According to U.S. International Trade Commission (2008), engineered wood flooring production 

2125 was estimated to be 258 mmsf in 2006. Based on conversations with HPVA, it is estimated that 2010 

2126 production levels for the hardwood plywood industry overall arewere about 60 percent of their 2006 

2127 levels, which would imply engineered wood flooring production of about 155 mmsf on a 3/8" basis. 

2128 About 30 percent of engineered wood flooring production is estimated to be manufactured as a wood 

2129 veneer laminated product (while the other 70 percent of production is manufactured as a product meeting 

2130 the CARB definition of hardwood plywood). Thus, the quantity of engineered wood flooring made as a 

2131 wood veneer laminated product is estimated to be about 47 mmsf on a 3/8” basis, or 28 mmsf if calculated 

2132 on a 5/8” basis. Since it is estimated that there are about 18 domestic engineered wood flooring producers 

2133 making wood veneer laminated products, it follows that the estimated average production volume per 

2134 firm is about 1.6 mmsf per year on a 5/8” basis. 

2135 

2136 Other Wood Veneer Laminated Product Producers 

2137 

2138 The production volume of other wood veneer laminated products (other than other than custom 

2139 panel and engineered wood flooring) is estimated based on Census data on the quantity of veneer 

2140 consumed in the industry. Figure 2-2 presents the methodology employed for estimating the consumption 

2141 of hardwood veneer by these other wood veneer laminated product manufactures. First, the data on the 

2142 dollar value of total hardwood veneer produced is obtained and the average cost per square foot of 

2143 hardwood veneer is estimated. These data are combined to estimate the total quantity of hardwood veneer 

2144 produced. Next, the quantity of hardwood veneer that is imported is added to the total domestic 

2145 hardwood veneer production, and then the quantity of hardwood veneer that is exported is subtracted. 

2146 This total reflects the estimated domestic consumption of hardwood veneer. Then, the dollar value of 

2147 hardwood veneer consumed by hardwood veneer and plywood producers is combined with the estimated 

2148 average hardwood veneer cost per square foot to generate the estimated consumption of hardwood veneer 

2149 by hardwood veneer and plywood producers. To estimate the quantity of veneer consumed by wood 

2150 veneer laminated product producers, the quantity of hardwood veneer consumed by hardwood veneer and 

2151 plywood producers is subtracted from the quantity of total hardwood veneer consumed domestically. 

2152 Note that this may overstate the quantity of wood veneer laminated product production because veneer is 

2153 also used in the manufacture of items that are not covered by the rule, such as statutorily exempt items, 

2154 hobbyist uses, and furniture repair. 

2155 

2156 The total dollar value of hardwood veneer produced is $1,075,909 thousand according to the 2007 

2157 Economic Census (U.S. Census Bureau 2009b). The corresponding cost per square foot of veneer is 

2158 estimated using U.S. ITC trade data on the value and quantity of veneer exported in 2007. According to 

2159 the U.S. ITC, 972,952,757 square feet of veneer was exported in 2007, with a value of $438,302 

thousand.28 2160 This results in an average veneer cost of $0.45 per square foot. Veneer costs vary widely 

2161 depending on the species, cut or pattern, and quality of the wood. While some laminators may primarily 

2162 use veneer that is priced higher than the estimated average of $0.45 per square foot, other laminators will 

2163 use veneer that is below this average cost. By combining the total dollar value of hardwood veneer 

2164 produced ($1,075,909 thousand) and the average price of hardwood veneer ($0.45), the analysis estimates 

2165 that domestic production of hardwood veneer is 2,390,909 thousand square feet (msf). 

2166 

2167 Data on hardwood veneer imports and exports was obtained from the U.S. ITC Interactive Tariff 

2168 and Trade Dataweb. According to U.S. ITC trade data, the quantity of U.S. hardwood veneer imports for 

2007 was 656,721 msf, while the quantity of U.S. hardwood veneer exports was 986,223 msf.29 2169 The 

 28 Excludes tropical hardwood veneer. 

29 Includes “Tropical Hardwood Veneer.” 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-98 

2170 estimated domestic hardwood veneer consumption of 2,061,407 msf is calculated by adding the imports 

2171 and subtracting the exports from the domestic hardwood veneer production. 

2172 

2173 The dollar value of hardwood veneer consumed by hardwood veneer and plywood manufacturers, 

2174 $626,244 thousand, is available from the 2007 Economic Census (U.S. Census Bureau 2009e). The 

2175 corresponding cost per square foot of veneer for hardwood plywood manufacturers is estimated using 

2176 U.S. ITC trade data on the value and quantity of veneer exported in 2007. By combining the total dollar 

2177 value of hardwood veneer consumed by the hardwood veneer and plywood manufacturers ($626,244 

2178 thousand) and the average price of exported hardwood veneer ($0.45), the analysis estimates that 

2179 consumption of hardwood veneer by plywood manufacturers is 1,391,653 msf. Thus, total domestic 

2180 veneer consumption by wood veneer laminated product producers is estimated to be 669,753 msf.
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-99 

2181 

Figure 2-2: Estimating Quantity of Harwood Veneer Consumed by Other Wood Veneer Laminated Product Producers (excluding 

engineered wood flooring and custom panel producers) 

2182 

Step 1: Estimate domestic

hardwood veneer production

(2,390,909 msf) 

(Dollar value of hardwood veneer

produced divided by estimated cost per

square foot for hardwood veneer)

$1,075,909/$0.45

Obtain data on the dollar value of

hardwood veneer produced from

2007 Economic Census. Product

code 3212111: Hardwood veneer,

including backed w/ paper/cloth/etc.

Estimate cost per square foot of

veneer by using U.S. ITC trade

data on the value and quantity of

veneer exported in 2007.

(quantity of hardwood veneerexported in 2007 divided by the

estimated value of the hardwood

veneer exported in 2007)

Step 2: Estimate domestic 

hardwood veneer consumption

(2,061,407 msf) 

(Total Production [Step 1] + Imports –

Exports)

2,390,909 + 656,721 ‐ 986,223

Step 3: Estimate domestic 

consumption of hardwood veneer 

by hardwood plywood 

manufacturers

(1,391,653 msf)

(Dollar value of hardwood veneer

consumed by hardwood veneer and

plywood manufacturers divided by

estimated cost per square foot for

hardwood veneer)

$626,244/$0.45

Step 4: Estimate domestic 

consumption of hardwood veneer 

by laminators.

(669,753 msf)

(Subtract estimated domestic

consumption of hardwood veneer by

hardwood plywood manufacturers

[Step 3] from the estimated domestic

hardwood veneer consumption

[Step2])

2,061,406‐1,391,653

Obtain data on imports of

hardwood veneer from the 2007

U.S. ITC Interactive Tariff and

Trade Dataweb.

Obtain data on exports ofhardwood veneer from the 2007

U.S. ITC Interactive Tariff and

Trade Dataweb.

440890 Veneer sheets and sheets for plywood, etc. whether of not planned, etc., not

over 6 mm (.236 in.) thick, or non‐coniferous wood, nesoi.

440831 Veneer sheets and sheets for plywood and other wood sawn lengthwise,

slicked or peeled, thickness not exceeding 6 mm, dark/light meranti &meranti bakau

440839 Veneer sheets and sheets for plywood and other wood sawn lengthwise,

slicked or peeled, thickness not exceeding 6 mm, other tropical wood, nesoi

440890 Veneer sheets and sheets forplywood, etc. whether of not planned,

etc., not over 6 mm (.236 in.) thick, or

non‐coniferous wood, nesoi.

440831 Veneer sheets and sheets for

plywood and other wood sawn

lengthwise, slicked or peeled,

thickness not exceeding 6 mm, dark/

light meranti &meranti bakau

Obtain data on the dollar value of

hardwood veneer consumed byhardwood veneer and plywood

manufacturers from the 2007

Economic Census: Sector 31:

EC0731I3: Manufacturing:

Industry Series: MaterialsConsumed by Kind for the United

States: 2007.

Estimate cost per square foot ofveneer by using U.S. ITC trade

data on the value and quantity of

veneer imported in 2007.(quantity of hardwood veneer

imported in 2007 divided by the

estimated value of the hardwood

veneer imported in 2007)
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-100 

2183 To estimate the volume of wood veneer laminated product produced per volume of veneer 

2184 consumed it is assumed that about 30 percent of the veneer is lost during the production process due to 

2185 trimming, etc. It is also assumed that all wood veneer laminated product producers affix both a face and a 

2186 back veneer, so for each square foot of veneer consumed, 0.35 (0.35 = half of 70%) square feet of wood 

2187 veneer laminated product is produced. Note that wood veneer laminated product producers may often 

2188 only affix a face veneer, but the estimated costs of switching adhesives are not affected by this 

2189 assumption since the number of glue lines assumed and the estimated quantity of product manufactured 

are inversely related;30 2190 however, the estimates of platform costs are affected by this assumption. 

2191 

2192 Table 2-58 presents the estimated production of wood veneer laminated products other than 

2193 custom panels and engineered wood flooring, using the estimate of domestic consumption of hardwood 

2194 veneer by laminators. 

2195 

Table 2-58: Production Volume of Other Wood Veneer Laminated Products 

Product Category Estimated Square 

Footage of Hardwood 

Veneer Consumed (msf) 

Surface Area of Wood 

Veneer Laminated 

Product Produced per 

Square Foot of 

Hardwood Veneer 

Consumed 

Estimated Surface Area 

of Wood Veneer 

Laminated Product 

Produced (msf) 

Wood Veneer Laminated 

Product Other than Custom 

Panels and Engineered 

Wood Flooring 

669,754 0.35 234,414 

Sources: U.S. Census Bureau 2009b, U.S. Census Bureau 2009e, U.S. ITC 2011a, U.S. ITC 2011b 

2196 

2197 The estimated production of 307,032234,414 msf from Table 2-58 is disaggregated in Table 2-59 

2198 according to the relative share of the total value of hardwood veneer consumed by employer 

2199 establishments in the various wood veneer laminated product industries. 

2200 

2201 

2202 

2203 

2204 

2205 

2206 

2207 

2208 

2209 

2210 

 30 For a given quantity of veneer, a manufacturer that affixes only a face veneer produces twice the square footage of 

laminated product as a manufacturer affixing both face and back veneers. But the former incurs half the cost per square 

foot for glue compared to the latter. Thus, both manufacturers have the same cost for glue. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-101 

Table 2-59: Production Volume of Other Wood Veneer Laminated Product Producers

Product Type NAICS Code and 

Description Value of Hardwood 

Veneer Consumed 

(thousands, 2007$) 

Percent of 

Veneer 

Consumed 

Estimated 

Surface Area of 

Wood Veneer 

Laminated 

Product 

Produced (msf) 

Cabinets 

Wood Kitchen Cabinet and 

Countertop Manufacturing 

(337110) 

$95,058 

Wood Television, Radio, 

and Sewing Machine 

Cabinet Manufacturing 

(337129) 

$1,262 

Subtotal – Cabinets $96,320 24% 56,259

Household Furniture 

Upholstered House 

Furniture Manufacturing 

(337121) 

$11,737 

Non-upholstered Wood 

Household Furniture 

Manufacturing (337122) 

$69,525 

Subtotal – Household 

Furniture $81,262 21% 49,227 

Office and Institutional 

Furniture 

Institutional Furniture 

Manufacturing (337127) $24,948 

Wood Office Furniture 

Manufacturing (337211) $37,840 

Showcase, Partition, 

Shelving, and Locker 

Manufacturing (337215) 

$10,626 

Subtotal –Office and 

Institutional Furniture $73,414 19% 44,539

Window and Door 

Producers 

Wood Window and Door 

Manufacturing (321911) $91,989 23% 53,915

Architectural Woodwork 

and Millwork 

Custom Architectural 

Woodwork and Millwork 

Manufacturing (337212) 

$53,149 13% 30,474

 Total $396,134 100% 234,414 

Sources: U.S. Census Bureau 2009b, U.S. Census Bureau 2009e, U.S. ITC 2011a, U.S. ITC 2011b 

2211 

2212 

2213 2.4.1.2 Estimated Raw Materials Costs for Wood Veneer Laminated Product Producers 

2214 

2215 Since wood veneer laminated product producers make higher value-added products compared to 

2216 stock hardwood plywood panels, keeping resin costs low is not as critical to their competitiveness as it is 

2217 for stock panel producers. Many producers of wood veneer laminated products are believed to use PVA, 

2218 which is a NAF resin, as a face adhesive. PVA resin is more expensive than UF resin, but it has a number 

2219 of advantages: PVA is easy to work with, easy to clean up, and the press temperature can be kept low. 

2220 However, some producers still use UF resins. For the purpose of cost estimation, it is assumed that if 

2221 wood veneer laminated products are not excluded from the definition of hardwood plywood, virtually all 

2222 producers using UF resins will switch adhesive technologies in order to meet the emissions standards in 

2223 TSCA Title VI. 

2224 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-102 

2225 The main steps to estimating the change in raw material costs to wood veneer laminated product 

2226 producers under an analytical option where switching to NAF resins is the likely compliance strategy are 

2227 as follows: 

2228 

2229 1. Estimate the total production volume from facilities that are expected to continue to use UF resins 

2230 in the absence of a national rule. 

2231 2. Assuming that mills using UF resins will switch to PVA resins, estimate unit cost of switching 

2232 from UF to PVA resins. 

2233 3. Estimate the production volume that will need to switch to low emission platforms in order to 

2234 achieve the hardwood plywood emission standard. 

2235 4. Estimate unit cost of switching to a low emission platform to achieve the hardwood plywood 

2236 emission standard. 

2237 5. Estimate total cost of switching from UF to PVA resins and low emission platforms by 

2238 multiplying the unit costs with the production volume that is subject to the changes. 

2239 Note that switching to PVA face resins is just one possibility for achieving compliance with the 

2240 Phase 2 emissions standards. Some producers may achieve compliance by using enhanced urea 

2241 formaldehyde resins, melamine-urea-formaldehyde (MUF) resins, soy-based resins, or other resin 

2242 systems. However, the cost of switching to PVA face resins can provide a reasonable approximation for 

2243 the compliance cost associated with changing raw materials and production processes and therefore is the 

2244 basis for the cost estimates in this analysis. 

2245 

2246 Production Volume Switching to PVA resins 

2247 

2248 Table 2-60 presents the estimated quantity of wood veneer laminated products currently 

2249 manufactured using UF resins, based on the estimated production volumes presented in section 2.4.1.1 

2250 and on conversations with industry contacts about the share of products made using UF resins. 

2251 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-103 

Table 2-60: Estimating Wood Veneer Laminated Product Production Volume Manufactured 

Using UFFormaldehyde-Added Resins 

Product Category 

Estimated 

Surface 

Area of 

Wood 

Veneer 

Laminated 

Product 

Produced 

(msf, 5/8”) 

Estimated 

Percentage of 

Production 

Potentially 

Using 

Formaldehyde

-Added Resins 

Estimated 

Production 

Volume 

Switching to 

NAFmade 

with 

Formaldehyde

-Added Resins 

(msf, 5/8”) 

Comments 

Architectural Panels / 

Custom Panels 100,000 25% 25,000

Some industry contacts thought using 

formaldehyde added resins was not 

common. In order to be conservative in 

terms of being careful not to understate 

costs it is assumed that 25% of production 

uses UFformaldehyde-added resins. 

Engineered Wood 

Flooring 28,000 25% 7,000

Some industry contacts thought using 

formaldehyde added resins was not 

common. In order to be conservative in 

terms of being careful not to understate 

costs it is assumed that 25% of production 

uses UFformaldehyde-added resins. 

Cabinets 56,259 45% 25,317

About 45% of cabinet producers use 

UFformaldehyde-added resins according to 

KCMA (2010). 

Household Furniture 49,227 45% 22,152

Information on resin use by household 

furniture producers was limited, so it is 

assumed that 45% of them use 

UFformaldehyde-added resins, similar to 

cabinet producers. 

Office and Institutional 

Furniture 44,539 5% 2,227

BIFMA (2010) reported UFformaldehydeadded resins were used very little if at all 

for office and institutional furniture. Thus, 

5% of production is assumed to be 

produced with UFformaldehyde-added

resins. 

Wood Window and 

Door Manufacturing 53,915 45% 24,262

Information on resin use by window and 

door producers was limited, so it is 

assumed that 45% of producers use 

UFformaldehyde-added resins, similar to 

cabinet producers. 

Custom architectural 

woodwork and 

millwork manufacturing 

30,474 5% 1,524

Little information was available for 

architectural woodwork and millwork 

producers. Thus, 5% of production is 

assumed to be produced with 

UFformaldehyde-added resins, similar to 

office and institutional furniture producers.

Total 362,414 107,482 

2252 

2253 Production Volume Switching to Low Emission Platforms 

2254 

2255 Under options SI, CI, and NI wood veneer laminated product producers would be considered 

2256 hardwood plywood producers, and therefore producers using composite core platforms might need to 

2257 switch to ULEF or NAF composite core platforms in order to meet the emissions standard. Under Option 

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

May 1, 2013 2-104 

2258 SP, this would be the case only for custom panel producers since other wood veneer laminated product 

2259 producers would be considered fabricators under this option. However, under options SI, SP, CI, and NI 

2260 producers using veneer core platforms that meet the CARB 2 emissions standards but are not NAF or 

2261 ULEF platforms are expected to be able to achieve the emissions standards without switching platforms. 

2262 Under Option SN, however, wood veneer laminated product producers would also have to use NAF face 

2263 veneer and NAF platforms to be exempt from the definition of hardwood plywood. Under options SC, 

2264 SCR, and SCRSCUR (the proposed option), wood veneer laminated products would be exempted from 

2265 the emissions standards if they were made with NAF face resins and platforms compliant with the TSCA 

2266 Title VI emissions standards. But since all platforms will be compliant with the emissions standards after 

2267 the Title VI rule takes effect, the only estimated incremental costs are for switching to NAF resins. It is 

2268 assumed that under options SN, SC, SCR, and SCRSCUR most wood veneer laminated product producers 

2269 that were not already doing so would use NAF platforms (Option SN) and/or NAF face resins (options 

2270 SN, SC, SCR, and SCRSCUR) in order to avoid being categorized as hardwood plywood producers. 

2271 

2272 To summarize, the affected wood veneer laminated product producers are generally expected to: 

2273 

2274  switch to ULEF and NAF composite core platforms under options SI, SP, CI, and NI 

2275  switch to using NAF face resins and NAF platforms under Option SN, and 

2276  make no changes to platforms under options SC, SCR, and SCRSCUR, as TSCA Title VI compliant 

2277 platforms would be needed to qualify for the exemption, but all baseline platforms are assumed to be 

2278 TSCA Title VI compliant. 

2279 

2280 The resulting estimates and a detailed description of the underlying calculations are presented 

2281 below in Table 2-61 (for options SI, SP, CI, NI), and Table 2-62 (for Option SN). 

2282 

2283 
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May 1, 2013 2-105 

Table 2-61: Wood Veneer Laminated Product Production Switching to Low Emission Platforms: 

Options SI, SP, CI, and NI 

Product 

Category 

Production 

(msf, 5/8”) 

Production 

Switching to Low 

Emission Platforms Description of Estimated Percentages a, b

(%) (msf) 

Architectural 

Panels / 

Custom 

Panels 

100,000 35.5% 35,500 

Based on conversations with HPVA Personal Communication with HPVA 2011a), 40% of 

hardwood plywood is composite core, and this is also assumed to be the case for custom 

panels. It was estimated that the mix of MDF and particleboard consumed in the Hardwood 

Veneer and Plywood Industry (NAICS 321211) is about 40.9% MDF and 59.1% 

particleboard. It was estimated that 86.1% and 90.5% of MDF and particleboard are not 

made with NAF or ULEF resins, respectively. Thus, 35.5% is calculated as the sum of the 

two products of: (1) 40%, 40.9%, and 86.1%, and (2) 40%, 59.1%, and 90.5%. 

Engineered 

Wood 

Flooring 

28,000 1.8% 504 

Based on conversations with HPVA (2011a), 2% of engineered wood flooring is composite 

core. It was estimated that the mix of MDF and particleboard consumed in the Hardwood 

Veneer and Plywood Industry (NAICS 321211) is about 40.9% MDF and 59.1% 

particleboard. It was estimated that 86.1% and 90.5% of MDF and particleboard are not 

made with NAF or ULEF resins, respectively. Thus, 1.8% is calculated as the sum of the 

two products of: (1) 40.9%, 2%, and 86.1%, and (2) 59.1%, 2%, and 90.5%. 

Cabinets 56,259 66.0% 37,131 

It was estimated that the mix of Hardwood Plywood, MDF and particleboard consumed in 

the cabinet industries (NAICS 337110 and 337129) is 26.7% hardwood plywood, 7.5% 

MDF and 65.7% particleboard. It was estimated that 86.1% and 90.5% of MDF and 

particleboard are not made with NAF or ULEF resins, respectively. Thus, 66.0% is 

calculated as the sum of the two products of: (1) 7.5% and 86.1%, and (2) 65.7% and 90.5%. 

Household 

Furniture 49,227 57.9% 28,502 

It was estimated that the mix of Hardwood Plywood, MDF and particleboard consumed in 

the Household Furniture Manufacturing Industries (NAICS 337121 and 337122) is 34.9% 

hardwood plywood, 23.4% MDF and 41.7% particleboard. It was estimated that 86.1% and 

90.5% of MDF and particleboard are not made with NAF or ULEF resins, respectively. 

Thus, 57.9% is calculated as the sum of the two products of: (1) 23.4% and 86.1%, and (2) 

41.7% and 90.5%. 

Office and 

Institutional 

Furniture 

44,539 55.6% 24,764 

It was estimated that the mix of Hardwood Plywood, MDF and particleboard consumed in 

the Office and Institutional Furniture Manufacturing Industries (NAICS 337127, 337211 

and 337115) is about 37.5% hardwood plywood, 22.2% MDF and 40.3% particleboard. It 

was estimated that 86.1% and 90.5% of MDF and particleboard are not made with NAF or 

ULEF resins, respectively. Thus, 55.6% is calculated as the sum of the two products of: (1) 

22.2% and 86.1%, and (2) 40.3% and 90.5%. 

Wood Window 

and Door 

Manufacturing 53,915 73.3% 39,520 

It was estimated that the mix of Hardwood Plywood, MDF and particleboard consumed in 

the Window and Door Manufacturing Industry (NAICS 321911) is 17.5% hardwood 

plywood, 33.1% MDF and 49.5% particleboard. It was estimated that 86.1% and 90.5% of 

MDF and particleboard are not made with NAF or ULEF resins, respectively. Thus, 73.3% 

is calculated as the sum of the two products of: (1) 33.1% and 86.1%, and (2) 49.5% and 

90.5%. 

Custom 

architectural 

woodwork and 

millwork 

manufacturing 

30,474 59.4% 18,102 

It was estimated that the mix of Hardwood Plywood, MDF and particleboard consumed in 

the Architectural Woodwork and Millwork Industry (NAICS 337212) is 33.27% hardwood 

plywood, 22.78% MDF and 43.95% particleboard. It was estimated that 86.1% and 90.5% 

of MDF and particleboard are not made with NAF or ULEF resins, respectively. Thus, 

59.4% is calculated as the sum of the two products of: (1) 22.78% and 86.1%, and (2) 

43.95% and 90.5%. 

Total 362,414 184,023 a The mix of composite wood products consumed were estimated using U.S. Census (2009e) data on the value of materials consumed. Values were 

converted to volumes using prices of $480, $445, and $315 msf for hardwood plywood, MDF, and particleboard, respectively. The price of hardwood 

plywood was estimated using the total 2007 export values and quantities from U.S. ITC (2010) data (HTS codes 441232, 441299, and 441231). The 

price of MDF and particleboard utilized are July 2007 prices from RISI’s (2011a) MDF and Particleboard Commentary. 

b The percentages of composite platforms not made with NAF or ULEF resins was estimated from EPA’s (2010a) survey of composite wood product 

producers. Since the percentage of ULEF production was not distinguished from other CARB 2 certified added-formaldehyde production in EPA’s 

(2010a) survey of composite wood product producers, it was estimated that 37% of CARB 2 certified added-formaldehyde production is ULEF since 7 

of the 19 CARB 2 certified mills that are not NAF exempt are ULEF exempt according to CARB’s lists of certified mills and ULEF and NAF mills. 

This analysis uses the term “low emission platforms” to mean platforms with emissions low enough that wood veneer laminated products made from 

them meets the applicable hardwood plywood emission standard. 

Sources: California Air Resources Board 2011bCARB 2011,, U.S. Census 2009e, U.S. EPA 2010a, U.S. ITC 2010, and RISI 2011a
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-106 

2284 

Table 2-62: Wood Veneer Laminated Product Production Switching to NAF Platforms: Option SN

Product 

Category 

Production 

(msf, 5/8”) 

Production 

Switching to Low 

Emission Platforms Description of Estimated Percentages a, b

(%) (msf) 

Architectural 

Panels / 

Custom Panels 

100,000 73.3% 73,300 

Based on conversations with HPVA (2011a), 60% of hardwood plywood panels are 

veneer core. It was estimated that the mix of MDF and particleboard consumed in the 

Hardwood Veneer and Plywood Industry (NAICS 321211) is about 40.9% MDF and 

59.1% particleboard. Thus, the estimated mix of veneer core, MDF and particleboard 

platforms for custom panels is about 60.0% hardwood plywood, 16.4% MDF and 23.6% 

particleboard. It was also estimated that 60.6%, 90.7%, and 93.3% of HWPW, MDF and 

particleboard are made using resins that are not NAF. Thus, the percentage of custom 

panels switching to NAF platforms (73.3%) is calculated as the sum of the three 

products: (1) 60% and 60.6%, (2) 16.4% and 90.7%, and (3) 23.6% and 93.3%. 

Engineered 

Wood 

Flooring 

28,000 61.2% 17,136 

Based on conversations with HPVA (2011a), 2% of engineered wood flooring is 

composite core. It was estimated that the mix of MDF and particleboard consumed in 

the Hardwood Veneer and Plywood Industry (NAICS 321211) is about 40.9% MDF and 

59.1% particleboard. It was estimated that 60.6%, 90.7%, and 93.3% of hardwood 

plywood, MDF and particleboard are not made with NAF resins. Thus, 61.2% is 

calculated as the sum of the three products of: (1) 98% and 60.6%, (2) 2%, 40.9%, and 

90.7%, and (3) 2%, 59.1% and 93.3%. 

Cabinets 56,259 84.4% 47,483 

It was estimated that the mix of Hardwood Plywood, MDF and particleboard consumed 

in the cabinet industries (NAICS 337110 and 337129) is 26.71% hardwood plywood, 

7.55% MDF and 65.74% particleboard. It was estimated that 90.7% and 93.3% of MDF 

and particleboard are not made with NAF resins. Thus, 84.4% is calculated as the sum 

of the three products of: (1) 26.71% and 60.6%, (2) 7.55% and 90.7%, and (3) 65.74% 

and 93.3%. 

Household 

Furniture 49,227 81.3% 40,022 

It was estimated that the mix of Hardwood Plywood, MDF and particleboard consumed 

in the Household Furniture Manufacturing Industries (NAICS 337121 and 337122) is 

34.9% hardwood plywood, 23.4% MDF and 41.7% particleboard. . It was estimated 

that 60.6%, 90.7%, and 93.3% of hardwood plywood, MDF and particleboard are not 

made with NAF resins. Thus, 81.3% is calculated as the sum of the three products of: 

(1) 34.9% and 60.6%, (2) 23.4% and 90.7%, and (3) 41.7% and 93.3%. 

Office and 

Institutional 

Furniture 

44,539 80.4% 35,809 

It was estimated that the mix of Hardwood Plywood, MDF and particleboard consumed 

in the Office and Institutional Furniture Manufacturing Industries (NAICS 337127, 

337211 and 337115) is about 37.5% hardwood plywood, 22.2% MDF and 40.3% 

particleboard. It was estimated that 60.6%, 90.7%, and 93.3% of hardwood plywood, 

MDF and particleboard are not made with NAF resins. Thus, 80.4% is calculated as the 

sum of the three products of: (1) 37.5% and 60.6%, (2) 22.19% and 90.7%, and (3) 

40.28% and 93.3%. 

Wood 

Window and 

Door 

Manufacturing 

53,915 86.7% 46,744 

It was estimated that the mix of Hardwood Plywood, MDF and particleboard consumed 

in the Window and Door Manufacturing Industry (NAICS 321911) is 17.45% hardwood 

plywood, 33.09% MDF and 49.46% particleboard. It was estimated that 60.6%, 90.7%, 

and 93.3% of hardwood plywood, MDF and particleboard are not made with NAF 

resins. Thus, 86.7% is calculated as the sum of the three products of: (1) 17.45% and 

60.6%, (2) 33.09% and 90.7%, and (3) 49.46% and 93.3%. 

Custom 

architectural 

woodwork and 

millwork 

manufacturing 

30,474 81.8% 24,928 

It was estimated that the mix of Hardwood Plywood, MDF and particleboard consumed 

in the Architectural Woodwork and Millwork Industry (NAICS 337212) is 33.3% 

hardwood plywood, 22.8% MDF and 44.0% particleboard. It was estimated that 

60.6%, 90.7%, and 93.3% of hardwood plywood, MDF and particleboard are not made 

with NAF resins. Thus, 81.8% is calculated as the sum of the three products of: (1) 

33.3% and 60.6%, (2) 22.78% and 90.7%, and (3) 43.95% and 93.3%. 

Total 362,414 285,422 Total 

a

The mix of composite wood products consumed were estimated using U.S. Census (2009e) data on the value of materials consumed. Values were 

converted to volumes using prices of $480, $445, and $315 msf for hardwood plywood, MDF, and particleboard, respectively. The price of 

hardwood plywood was estimated using the total 2007 export values and quantities from U.S. ITC (2010) data (HTS codes 441232, 441299, and 

441231). The price of MDF and particleboard utilized are July 2007 prices from RISI’s (2011a) MDF and Particleboard Commentary. b The percentages of composite platforms not made with NAF resins was estimated from EPA’s (2010a) survey of composite wood product 

producers. 

Sources: U.S. Census 2009e, U.S. EPA 2010a, U.S. ITC 2010, and RISI 2011a 

2285 
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May 1, 2013 2-107 

2286 2.4.1.3 Summary of the Costs of Changing Raw Materials for Wood Veneer Laminated Product 

2287 Panel Producers 

2288 

2289 Table 2-63 presents the estimated costs of changing raw materials for wood veneer laminated 

2290 product producers under the various analytical options. No material costs are incurred under options SE, 

2291 SEUR, SFCC, CE, and NE since wood veneer laminated product producers are not subject to any 

2292 emissions requirements under these analytical options. The total costs are highest under options SI, CI 

2293 and NI, where all wood veneer laminated product producers would be considered hardwood plywood 

2294 producers. Total costs are lowest under Option SP, where only custom producers would be considered 

2295 hardwood plywood producers. Under Option SN, where wood veneer laminated product producers would 

2296 need to switch to NAF resins and platforms in order to avoid being classified as hardwood plywood 

2297 producers, the estimated cost of changes to raw materials is about $2520 million per year. Under options 

2298 SC, SCR, and SCRSCUR (the proposed option), where wood veneer laminated product producers would 

2299 need to use NAF face resins and Title VI certified platforms in order to avoid being classified as 

2300 hardwood plywood producers, the estimated cost of changes to raw materials is about $43 million per 

2301 year. 

2302 
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May 1, 2013 2-108 

Table 2-63: Estimated Costs of Raw Material Changes for Wood Veneer Laminated Product

Producers, by Analytical Option 

Firm Type 

Production 

Switching to 

PVA (msf) 

Cost of 

Switching to 

PVA 

(2010$/msf) 

Production 

Switching to 

Low Emission 

Platforms (msf)

Cost of 

Switching to 

Low Emission 

Platforms 

(2010$/msf) 

Total Annual Cost 

of Changing Raw 

Materials 

(thousands 

2010$/msf) 

Options SE, SEUR, SFCC, CE, and NE: All Laminated Products are Exempt from Definition of Hardwood Plywood 

No changes in raw materials needed 0 $0 0 $0 $0 

Option SI, CI, and NI: All Laminated Products are Included in Definition of Hardwood Plywood 

Architectural Panels / Custom Panels 25,000 $30 35,500 $60 $2,880 

Engineered Wood Flooring 7,000 $30 504 $60 $240 

Cabinets 25,317 $30 37,131 $60 $2,987 

Household Furniture 22,152 $30 28,502 $60 $2,375 

Office and Institutional Furniture 2,227 $30 24,764 $60 $1,553 

Window and Door Manufacturers 24,262 $30 39,520 $60 $3,099 

Architectural Woodwork and Millwork 1,524 $30 18,102 $60 $1,132 

Total Annual Costs 107,482 $30 184,023 $60 $14,266 

Option SP: Laminated Products are Exempt from Definition Except for Custom Panels 

Architectural Panels / Custom Panels 25,000 $30 35,500 $60 $2,880 

Engineered Wood Flooring - - - - - 

Cabinets - - - - - 

Household Furniture - - - - - 

Office and Institutional Furniture - - - - - 

Window and Door Manufacturers - - - - - 

Architectural Woodwork and Millwork - - - - - 

Total Annual Costs 25,000 $30 35,500 $60 $2,880 

Option SN: Laminated Products Using Added Formaldehyde Resins or Platforms are Included in the Definition of 

Hardwood Plywood 

Architectural Panels / Custom Panels 25,000 $30 73,300 $60 $5,148 

Engineered Wood Flooring 7,000 $30 17,136 $60 $1,238 

Cabinets 25,317 $30 47,483 $60 $3,608 

Household Furniture 22,152 $30 40,022 $60 $3,066 

Office and Institutional Furniture 2,227 $30 35,809 $60 $2,215 

Window and Door Manufacturers 24,262 $30 46,744 $60 $3,533 

Architectural Woodwork and Millwork 1,524 $30 24,928 $60 $1,541 

Total Annual Costs 107,482 $30 285,422 $60 $20,350 

Options SC, SCR, and SCRSCUR: Laminated Products Using Added Formaldehyde Resins and Platforms that are not 

Certified are Included in the Definition of Hardwood Plywood 

Architectural Panels / Custom Panels 25,000 $30 - - $750 

Engineered Wood Flooring 7,000 $30 - - $210 

Cabinets 25,317 $30 - - $760 

Household Furniture 22,152 $30 - - $665 

Office and Institutional Furniture 2,227 $30 - - $67 

Window and Door Manufacturers 24,262 $30 - - $728 

Architectural Woodwork and Millwork 1,524 $30 - - $46 

Total Annual Costs 107,482 $30 - - $3,224 

This analysis uses the term “low emission platforms” to mean platforms with emissions low enough that wood veneer laminated 

products made from them meets the applicable hardwood plywood emission standard. For the standard certification, low emission 

platforms are assumed to include certified veneer platforms, particleboard and MDF platforms certified as ULEF under the CARB 

ATCM, and particleboard and MDF platforms certified as NAF. For analytical options requiring wood veneer laminated products to

meet NAF emission levels, low emission platforms would include particleboard, MDF and veneer platforms certified as NAF. 

Option SCRSCUR is the proposed option. 

2303 
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May 1, 2013 2-109 

2304 2.4.2 Certification and Testing Costs for Wood Veneer Laminated Product Producers 

2305 

2306 Estimated certification and testing costs were presented in Section 2.2 for entities certifying 1 and 

2307 2 NAF products through a TPC, as well as for entities certifying 1 and 2 added formaldehyde products 

2308 through a TPC. As discussed in section 2.3.1, wood veneer laminated product producers would be likely 

2309 to switch to a PVA resin technology if they are considered hardwood plywood producers under the 

2310 proposed rule. Nevertheless, it is possible that some wood veneer laminated product producers may 

2311 prefer to continue using added formaldehyde face resins for process or product reasons. Thus, testing and 

2312 certification costs are estimated under each analytical option assuming that two percent of producers 

2313 continue to use added formaldehyde resins. Table 2-64 presents costs associated with testing and 

2314 certification by the number of product lines that require certification. Since there is some uncertainty 

2315 about the number of product lines that would require a separate certification, this analysis presents the 

2316 total costs for each analytical option for certifying 1 and 2 different product lines. To be comparable with 

2317 the benefits estimates, which were estimated for 30 year period, costs were annualized over a 30 year 

2318 period. 

2319 

Table 2-64: Estimated Wood Veneer Laminated Product Producer First and 

Subsequent Year Costs for Testing and Certifying Products 

Number of Product 

Lines Requiring 

Testing and 

Certification 

First 

Year 

Costs 

Subsequent 

Year Costs 

Costs Annualized Over 

30 Years Using 3 

Percent Discount 

Rate* 

Costs Annualized Over 

30 Years Using 7 

Percent Discount 

Rate* 

1 NAF Product Line $37,058 $6,517 $7,640 $8,159 

2 NAF Product Lines $42,015 $7,062 $8,367 $8,972 

1 Added 

Formaldehyde 

Product Line 

$72,508 $56,522 $54,532 $53,421 

2 Added 

Formaldehyde 

Product Lines 

$81,614 $62,782 $60,622 $59,412 

*Note that annualized costs will tend to be higher for higher discount rates when there are more upfront 

costs and lower for higher discount rates when upfront costs are smaller or future costs are higher. This is 

why annualized costs are higher for NAF certification and lower for added formaldehyde certification for 

the 7 percent discount rate compared to the 3 percent discount rate. 

2320 

2321 Table 2-65 presents the estimated annualized testing and certification costs by analytical option 

2322 under a variety of scenarios for the number of entities affected and the number of product lines that would 

2323 require testing and certification. Under options SE, CE, SEUR, SFCC, and NE wood veneer laminated 

2324 product producers would not be required to do any testing. Under options SI, SP, SN, SC, SCR, SCUR, 

2325 CI and NI, it is assumed that all but two percent of wood veneer laminated product producers would 

2326 switch to NAF resin technology and/or compliant or NAF platforms in order to reduce testing and 

2327 certification costs (options SI, SP, CI, and NI) or eliminate them (options SN, SC, SCR, and SCRSCUR). 

2328 

2329 
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May 1, 2013 2-110 

2330 

Table 2-65: Estimated Wood Veneer Laminated Product Producer Annualized Costs for 

Testing and Certification (thousands, 2010$)

Analytical Option 

Total 

Number 

of 

Affected 

Entities 

Products 

Lines 

Requiring 

Testing and 

Certification 

Number of Affected Entities with 

Testing and Certification costs by 

Certification Type 

Costs Annualized Over 

30 Years 

(thousands, 2010$) 

3% 

Discount 

Rate 

7% 

Discount 

Rate 

Option SE, SEUR, SFCC, 

CE, and NE: All Laminated 

Products are Exempt from 

Definition of Hardwood 

Plywood 

0 0 

None – wood veneer laminated 

product producers would not be 

required to do any testing

$0 $0 

Option SI, CE, and NE: All 

Wood Veneer Laminated 

Product s are Included in the 

Definition of Hardwood 

Plywood 

Low End 

Estimate: 

7,486 

1 

NAF - 7,336 Entities $56,046 $59,858 

Added Formaldehyde a - 150 Entities $8,180 $8,013 

All - 7,486 Entities $64,226 $67,871 

2 

NAF - 7,336 Entities $61,380 $65,818 

Added Formaldehyde a - 150 Entities $9,093 $8,912 

All - 7,486 Entities $70,473 $74,730 

High End 

Estimate: 

13,875 

1 

NAF - 13,598 Entities $103,887 $110,953 

Added Formaldehyde a - 277 Entities $15,105 $14,798 

All - 13,875 Entities $118,992 $125,750 

2 

NAF - 13,598 Entities $113,774 $122,000 

Added Formaldehyde a - 277 Entities $16,792 $16,457 

All - 13,875 Entities $130,566 $138,457 

Option SP: Wood Veneer 

Laminated Products Other 

Than Custom Panels are 

Exempt from the Definition 

of Hardwood Plywood 

MidRange 

Estimate: 

50 

1 

NAF - 49 Entities $374 $400 

Added Formaldehyde a - 1 Entities $55 $53 

All - 50 Entities $429 $453 

2 

NAF - 49 Entities $410 $440 

Added Formaldehyde a - 1 Entities $61 $59 

All - 50 Entities $471 $499 

Options SN, SC, SCR, and 

SCRSCUR: Wood Veneer 

Laminated Products are 

Defined as Hardwood 

Plywood Producers if they 

use (1) added formaldehyde 

resins, and (2) platforms with 

added formaldehyde (Option 

SN only) 

Low End 

Estimate: 

7,486 

1 Added Formaldehyde a - 150 Entities $8,180 $8,013 

2 Added Formaldehyde a - 150 Entities $9,093 $8,912 

High End 

Estimate: 

13,875 

1 Added Formaldehyde a - 277 Entities $15,105 $14,798 

2 

Added Formaldehyde a - 277 Entities $16,792 $16,457 a The number of producers using added formaldehyde resins post-rule is assumed to be 2 percent of the total number of 

wood veneer laminated product producers. The estimates of the total number are from Table 2-6 and Table 2-7. 

Option SCRSCUR is the proposed option. 

2331 

2332 2.4.3 Total Annualized Costs for Wood Veneer Laminated Product Producers 

2333 

2334 Table 2-66 presents the total estimated annualized costs by analytical option under a variety of 

2335 scenarios for the number of entities affected and the number of product lines that would require 

2336 certification. Under options SE, CE, SEUR, SFCC, and NE wood veneer laminated product producers 

2337 would not be required to do any testing and no incremental material costs are estimated because it is 

2338 assumed that they are already using compliant platforms. Under options SI, SP, SN, SC, SCR, SCUR, CI, 

2339 and NI it is assumed that all but two percent of wood veneer laminated product producers would switch to 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-111 

2340 NAF resin technology and/or compliant or NAF platforms to reduce testing and certification costs 

2341 (options SI, SP, CI, and NI) or eliminate them (options SN, SC, SCR, and SCRSCUR). 

2342 

2343 The results presented in Table 2-66 demonstrate that testing and certification costs are 

2344 overwhelmingly the dominant drivers of the costs for wood veneer laminated product producers. Even 

2345 under the scenarios with the fewest estimated numbers of affected entities and product lines, the costs 

2346 under Option SI far exceeds those estimated for options SN SC, SCR, and SCRSCUR, which only include 

2347 testing or certification costs for two percent of wood veneer laminated product producers. The 

2348 substantially lower costs under options SC, SCR, and SCRSCUR compared to Option SN reflects the 

2349 potentially high costs of switching platforms under option SN. Estimated costs (assuming 2 product lines 

2350 require testing) are lowest under Option SP because far fewer entities are affected under this option 

2351 compared to the others. 

2352 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-112 

Table 2-66: Estimated Wood Veneer Laminated Product Producer Annualized Costs for Raw Materials 

Changes, Testing, and Certification (thousands, 2010$) 

Analytical Option 

Total Number 

of Affected 

Entities 

Products 

Requiring 

Testing and 

Certification

Number of Affected Entities with 

Costs by Certification Type 

Costs Annualized 

Over 30 Years 

(thousands, 2010$) 

3% 7% 

Option SE, SEUR, SFCC, CE, and NE: All 

Laminated Products Exempt from Definition 

of Hardwood Plywood 

0 0 

None – no costs for changing raw 

materials, testing, or certification 

are estimated

$0 $0 

Option SI, CE, and NE: All Wood Veneer 

Laminated Products are Included in the 

Definition of Hardwood Plywood 

Low End 

Estimate: 

7,486 

1 

NAF - 7,336 Entities $69,347 $72,796 

Added Formaldehyde - 150 Entities $8,452 $8,278 

All - 7,486 Entities $77,799 $81,073 

2 

NAF - 7,336 Entities $74,681 $78,756 

Added Formaldehyde - 150 Entities $9,365 $9,176 

All - 7,486 Entities $84,047 $87,932 

High End 

Estimate: 

13,875 

1 

NAF - 13,598 Entities $117,189 $123,891 

Added Formaldehyde - 277 Entities $15,376 $15,061 

All - 13,875 Entities $132,565 $138,952 

2 

NAF - 13,598 Entities $127,076 $134,939 

Added Formaldehyde - 277 Entities $17,063 $16,721 

All - 13,875 Entities $144,139 $151,659 

Option SP: Wood Veneer Laminated Product 

s Other Than Custom Panels are Exempt 

from the Definition of Hardwood Plywood 

Mid-Range 

Estimate: 

50 

1 

NAF - 49 Entities $3,060 $3,012 

Added Formaldehyde - 1 Entities $109 $107 

All - 50 Entities $3,169 $3,118 

2 

NAF - 49 Entities $3,095 $3,052 

Added Formaldehyde - 1 Entities $115 $113 

All - 50 Entities $3,211 $3,164 

Option SN: Wood Veneer Laminated 

Products are Defined as Hardwood Plywood 

if they use (1) added formaldehyde resins, 

and (2) platforms with added formaldehyde 

Low End 

Estimate: 

7,486 

1 

NAF - 7,336 Entities $18,974 $18,455 

Added Formaldehyde - 150 Entities $8,568 $8,391 

All - 7,486 Entities $27,542 $26,846 

2 

NAF - 7,336 Entities $18,974 $18,455 

Added Formaldehyde - 150 Entities $9,481 $9,289 

All - 7,486 Entities $28,455 $27,744 

High End 

Estimate: 

13,875 

1 

NAF - 13,598 Entities $18,976 $18,456 

Added Formaldehyde - 277 Entities $15,492 $15,174 

All - 13,875 Entities $34,467 $33,630 

2 

NAF - 13,598 Entities $18,976 $18,456 

Added Formaldehyde - 277 Entities $17,179 $16,833 

All - 13,875 Entities $36,154 $35,290 

Options SC, SCR, and SCRSCUR: Wood 

Veneer Laminated Products are Defined as 

Hardwood Plywood if they use added 

formaldehyde resins 

Low End 

Estimate: 

7,486 

1 

NAF - 7,336 Entities $3,006 $2,924 

Added Formaldehyde - 150 Entities $8,241 $8,073 

All - 7,486 Entities $11,247 $10,997 

2 

NAF - 7,336 Entities $3,006 $2,924 

Added Formaldehyde - 150 Entities $9,155 $8,972 

All - 7,486 Entities $12,161 $11,895 

High End 

Estimate: 

13,875 

1 

NAF - 13,598 Entities $3,006 $2,924 

Added Formaldehyde - 277 Entities $15,167 $14,857 

All - 13,875 Entities $18,173 $17,781 

2 

NAF - 13,598 Entities $3,006 $2,924 

Added Formaldehyde - 277 Entities $16,853 $16,517 

All - 13,875 Entities $19,860 $19,441 

Option SCRSCUR is the proposed option. 

Formatted Table

Formatted Table

Formatted Table

Formatted Table
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May 1, 2013 2-113 

2353 2.5 Recordkeeping, Labeling, Supplier Notification, and Rule Familiarization 

2354 Costs 

2355 

2356 Under TSCA Title VI, EPA must promulgate regulations that establish labeling requirements, 

2357 chain of custody requirements, and recordkeeping requirements for industries that use composite wood 

2358 products for raw materials and sell products that contain composite wood. Producers that use composite 

2359 wood products as raw materials (hereafter referred to as fabricators), and wholesalers or distributers 

2360 (including importers) of composite wood products or regulated articles that contain composite wood 

2361 products, and retailers of composite wood products or regulated articles that contain composite wood 

2362 products, will be subject to chain of custody and labeling requirements. This set of firms along with 

2363 producers of hardwood plywood, MDF, and particleboard will also incur costs associated with becoming 

2364 familiar with the rule’s requirements. The purpose of this section is to estimate the incremental costs of 

2365 rule familiarization, recordkeeping, and labeling requirements under the TSCA Title VI rule for all 

2366 producers, fabricators, wholesalers, and retailers that are potentially affected by the proposed rule. 

2367 

2368 Note that the TSCA Title VI rule requires importers of articles that are composite wood products, 

2369 or articles that contain composite wood products, to comply with the TSCA Section 13 import 

2370 certification regulations for “Chemical Substances in Bulk and As Part of Mixtures and Articles,” as 

2371 found at 19 CFR 12.118 through 12.127. Thus, any U.S. importer of composite wood products or articles 

2372 that contain composite wood products would have to certify that all articles in the shipment either comply 

2373 with all applicable rules and orders under TSCA or that all the articles in the shipment are not subject to 

2374 TSCA. The statement must be on or attached to a commercial invoice or entry document belonging to the 

2375 imported shipment. In practice, import certification is fulfilled by checking a box on an invoice or entry 

2376 document. It is assumed that this does not generally impose a significant additional burden or cost on the 

2377 importer. Any potential burden associated with a submitter’s familiarization with this requirement is 

2378 assumed to be included in the more general rule familiarization burden discussed below. 

2379 

2380 Section 2.5.1 describes telephone questionnaires that were developed to better understand the 

2381 potential costs of the labeling and recordkeeping requirements. Per-firm rule familiarization, 

2382 recordkeeping, and labeling costs are presented in Section 2.5.2. Section 2.5.3 presents the estimated 

2383 number of affected entities using information on baseline compliance and the percentage of entities 

2384 incurring costs, estimated from the results of a telephone questionnaire. And finally, total incremental 

2385 recordkeeping, labeling, and rule familiarization costs are presented in Section 2.5.4. 

2386 

2387 2.5.1 Telephone Questionnaire 

2388 

2389 The proposed recordkeeping and labeling requirements under the TSCA Title VI rule are similar 

2390 to the requirements under the California Air Resources Board’s (CARB) Airborne Toxic Control Measure 

2391 (ATCM) to reduce formaldehyde emissions from composite wood products. So firms that manufacture or 

2392 sell composite wood products destined for California markets have experience implementing 

2393 recordkeeping and labeling requirements that are similar to the TSCA Title VI rule. To learn about the 

2394 experiences of the firms who are complying with the CARB ATCM requirements, two questionnaires 

2395 (one for fabricators and one for wholesalers) were administered to fewer than ten respondents per 

2396 questionnaire. These questionnaires asked respondents for descriptions of the changes they made and the 

2397 costs they incurred to implement any changes. 

2398 

2399 Retailers are also subject to the chain of custody and recordkeeping requirements. The California 

2400 Retailers Association indicated that retailers’ customary business practices were generally sufficient to 

2401 meet the chain of custody requirements in the CARB ATCM (California Retailers Association 2011), so 

2402 retailers were not administered a questionnaire. 

2403 
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May 1, 2013 2-114 

2404 

2405 2.5.1.1 Questionnaire Administration 

2406 

2407 Nine fabricator firms and seven wholesaler firms were administered telephone questionnaires that 

2408 asked about the changes that were made and the costs that were incurred in order to achieve compliance 

2409 with the CARB recordkeeping and labeling requirements. For fabricators, a diverse group of producers 

2410 was selected for the sample: one decorative panel manufacturer, two stock cabinet manufacturers, two 

2411 custom cabinet manufacturers, two household furniture manufacturers, and two business and institutional 

2412 furniture manufacturers. Most of the fabricators contacted were located in California, and all of them 

2413 were implementing the CARB recordkeeping and labeling requirements. For wholesalers, the sample 

2414 included four composite wood product wholesalers and three household furniture wholesalers, all located 

2415 in California and complying with CARB requirements. 

2416 

2417 For each of these respondent types, a list of the appropriate NAICS industries was found from 

2418 one of the following sources: industry association member lists, the Dun & Bradstreet database, the 

2419 Random Lengths Big Book, or the SalesGenie database. From the industry association lists, industry 

2420 members were assigned random numbers and contacted in ascending order by number. For the D&B 

2421 database, the relevant set of companies were identified by state and NAICS code, assigned random 

2422 numbers, and also contacted in ascending order. For the Random Lengths Big Book and the SalesGenie 

2423 database, first page numbers were selected randomly, and then individual firms were selected randomly 

2424 from that page to contact. 
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May 1, 2013 2-115 

2425 

Table 2-67: Sample of Firms Administered Recordkeeping and Labeling Questionnaire

Category Firm List Source Number of 

Respondents 

Fabricators 

Decorative Panel Manufacturers Composite Panel Association (CPA).2011 Surface & Panel Buyers Guide. 1 

Stock Cabinet Manufacturers in 

California 

Kitchen Cabinet Manufacturers Association (KCMA). 2010. KCMA 

Cabinet Manufacturers Members in California. 

Dun and Bradstreet (D&B). 2011. Companies in California, NAICS 

337110. 

Note: After calls were placed to all KCMA stock cabinet members located 

in CA the Dun and Bradstreet list was utilized. There was one response 

from each list. 

2 

Custom Cabinet Manufacturers in 

California 

SalesGenie. 2010. Companies in California, NAICS 337110. 

Dun and Bradstreet (D&B). 2011. Companies in California, NAICS 

337110. 

Note: After it was determined that a high percentage of respondents on 

the SalesGenie list were not in scope the D&B list was utilized. There 

was one response from each list. 

2 

Household Furniture Manufacturers in 

California 

Dun and Bradstreet (D&B). 2011. Companies in California, NAICS 

337122, 337121. 2 

Business and Institutional Furniture 

Manufacturers 

The Business and Institutional Furniture Manufacturer’s Association 

(BIFMA). 2010. BIFMA Members. 2 

Wholesalers 

Wood Product Wholesalers in California Random Lengths.2009 Big Book: The Buyers and Sellers Directory of the 

Forest Products Industry in California. 4 

Household Furniture Wholesalers in 

California 

Dun and Bradstreet (D&B). 2011. Companies in California, NAICS 4232. 3 

Sources: Business and Institutional Furniture Manufacturer’s Association 2010, Composite Panel Association 2010, Dun & 

Bradstreet 2010, Kitchen Cabinet Manufacturers Association 2010, Random Lengths 2009, SalesGenie 2010. 

2426 

2427 In order to estimate the average costs of complying with CARB’s recordkeeping and labeling 

2428 requirements, two separate questionnaires were administered to fabricators and wholesalers. First, 

2429 screener questions were administered to ensure that only firms that had made changes to comply with the 

2430 CARB regulations were selected to complete the survey. Then, firms were asked about the specific steps 

2431 they took to comply with CARB’s recordkeeping and/or labeling requirements, and what the labor and 

2432 material costs of those changes were. Figure 2-3 and Figure 2-4 present the phone scripts that were used 

2433 to administer these questionnaires. The responses to the questionnaires are included in Table 2-69 and 

2434 Table 2-70. 
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May 1, 2013 2-116 

Figure 2-3: Fabricator Firm Recordkeeping and Labeling Costs Questionnaire

Introduction: Hello, this is ________ calling from Abt Associates on behalf of the U.S. 

Environmental Protection Agency. 

This past July Congress passed legislation that requires EPA to develop formaldehyde standards 

for composite wood products that may include recordkeeping and labeling requirements for 

manufacturers who fabricate composite wood products. The U.S. EPA is interested in learning from 

firms that have implemented labeling and recordkeeping procedures to comply with California’s 

formaldehyde rule to help them develop national recordkeeping and labeling requirements. 

 

Screener Questions: 

1a (For Decorative Panel Manufacturers). Are you a manufacturer of decorative panels that uses 

purchased hardwood plywood, medium density fiberboard, or particleboard for a platform? Do 

you manufacture: (1) filled or coated products, (2) high pressure laminates, (3) hot stamp foils, 

(4) low basis weight papers, (5) low pressure decorative laminates, (6) medium and high density 

overlays, or (7) vinyl laminates? (Note that other types of decorative panel manufacturers would 

be accepted as in-scope) 

1b (For Other Fabricators). Is your firm a manufacturer of [stock cabinets/custom cabinets/household 

furniture/business or institutional furniture] made using composite wood products?

2. Have you implemented labeling and recordkeeping procedures that meet the requirements of the 

California formaldehyde rule?

3. Do you follow these procedures for all products using composite wood platforms, including those sold 

outside California where the labeling and recordkeeping procedures would not be required? 

(Note that fabricators with any products that are CARB compliant are considered in-scope)

4. Most of the questions I have are about how much it cost to implement the labeling and recordkeeping 

procedures, are you the best person for me to ask about these costs? 

Questionnaire: 

1. Please describe in detail the changes you implemented in recordkeeping activities for complying with 

CARB’s requirements. Please describe the one time costs you incurred in order to implement 

these changes, either in terms of dollars or hours. Can you also describe the additional recurring 

costs you incur because of the CARB requirements, either in terms of dollars or hours. (If hours 

ask what type of employee)

2. Please describe in detail the changes you implemented to your existing labeling practices, or the new 

labeling practices you introduced, in order to comply with CARB requirements. 

3. What was the initial cost to make changes to the labeling process? 

4. If the CARB requirements increased your per-label costs, what is the additional cost per label?

5. Do you generally label each CARB-certified item you manufacture, or do you label a box or bundle of 

items?

6. Do you have separate CARB-certified inventory and not-CARB-certified inventory? If so, what 

percentage of your inventory is CARB-certified? 

2435 
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May 1, 2013 2-117 

Figure 2-4: Wholesaler Firm Recordkeeping Costs Questionnaire

Introduction: Hello, this is ______ calling from Abt Associates on behalf of the U.S. Environmental 

Protection Agency. This past July Congress passed legislation that requires EPA to develop 

formaldehyde standards for composite wood products that may include recordkeeping requirements for 

companies that distribute composite wood products. The U.S. EPA is interested in learning from firms 

that have implemented recordkeeping procedures to comply with California’s formaldehyde rule to help 

them develop national recordkeeping requirements. 

Screener Questions: 

1. Is your firm a wholesaler, distributor, or importer of composite wood products or products that contain 

composite wood? 

2. Background: The California rule requires records showing the date of purchase, the supplier, as well as 

documentation of precautions taken to ensure that products meet emissions standards to be 

maintained for two years. 

3. Do your recordkeeping procedures meet the requirements of the California formaldehyde rule? 

Questionnaire: 

1. Before this rule was implemented, were you already keeping purchasing records for at least two years, 

or was this something new that you had to start doing? 

2. Did you need to modify your existing recordkeeping system for the purpose of complying with the 

California rule?

3. Please describe the one time costs you incurred in order to implement this new system, either in terms 

of dollars or hours. 

4. Does maintaining the new recordkeeping system require more effort or additional costs compared to 

your previous recordkeeping system? (If yes), how much additional effort or cost is required for 

maintaining records under the new system? Please describe either in terms of dollars or hours. 

2436 

2437 2.5.1.2 Questionnaire Responses and Resulting Per-Firm Cost Estimates 

2438 

2439 The responses presented below include qualitative descriptions of recordkeeping and labeling 

2440 practice changes due to CARB Rule requirements. Table 2-68 presents the fully loaded wage rates used 

2441 for estimating labor costs. Table 2-69 and Table 2-70 summarize the responses to the fabricator and 

2442 wholesaler questionnaires, respectively, including descriptions of recordkeeping costs, labeling costs, and 

2443 the costs estimated based on the responses. 

2444 

2445 Since the recordkeeping functions described by responses appeared to be tasks likely be 

2446 performed by support staff, the analysis estimates these labor costs with the fully loaded wage for “office 

2447 and administrative support” staff in private industry ($24.84 for fabricator industries and $25.54 for 

2448 wholesaler industries (U.S. Bureau of Labor Statistics 2010a, b, d, e)). Since the labeling system changes 

2449 described by respondents appeared to be tasks that would require technical labor, the analysis uses the 

2450 fully loaded wage rates for “computer and mathematical science” workers in private industry ($44.27, 

U.S. Bureau of Labor Statistics 2010a, b, e) (See Table 2-68).31 2451 

2452 

 31 May 2009 wages are taken from Occupation Employment Statistics (OES) data and converted into 2010 dollars using 

Employer Cost for Employee Compensation (ECEC) data. To calculate a loaded wage rate, average total benefits for 

all workers (42%) is added to the overhead rate (17%) to calculate an overall wage multiplier of 1.59. 
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May 1, 2013 2-118 

Table 2-68: Hourly Wage Rate Estimation for Recordkeeping and Labeling Labor Costs

Labor Cost 

Elements Industry 

OES Wage Data 

Occupation 

Descriptiona

May 2009 Mean 

Hourly Wagea

2010 Adjusted 

Mean Hourly 

Wageb

2010 Loaded 

Hourly Wage 

(x1.59)c

Fabricators 

Rule 

Familiarization 

NAICS 321000 - 

Wood Product 

Manufacturing 

Management 

Occupations $45.86 $46.29 $73.60 

Supplier 

Notification 

NAICS 321000 - 

Wood Product 

Manufacturing 

Office and 

Administrative 

Support 

Occupations 

$15.47 $15.62 $24.84 Recordkeeping 

Initial Costs 

Recordkeeping 

Recurring Costs 

Labeling Initial 

Costs 

NAICS 321000 - 

Wood Product 

Manufacturing 

Computer and 

Mathematical 

Science 

Occupations 

$27.58 $27.84 $44.27 

Wholesalers 

Rule 

Familiarization 

Sector 42 – 

Wholesale Trade 

Management 

Occupations $58.12 $58.67 $93.29 

Supplier 

Notification 

Sector 42 – 

Wholesale Trade 

Office and 

Administrative 

Support 

Occupations 

$15.91 $16.06 $25.54 Recordkeeping 

Initial Costs 

Recordkeeping 

Recurring Costs 

Retailers 

Rule 

Familiarization 

Sectors 44 and 45 

– Retail Trade 

Management 

Occupations $44.06 $44.47 $70.71 

Supplier 

Notification 

Sectors 44 and 45 

– Retail Trade 

Office and 

Administrative 

Support 

Occupations 

$12.04 $12.15 $19.32 

a Mean wages are estimated using the data from the Bureau of Labor Statistics Occupational Employment Statistics, which are 

available for May 2009. 

b Wages are inflated to 2010$ using Employer Cost for Employee Compensation (ECEC) wage data for all industries and 

occupations. 

c A loading factor of 1.59 is used to add the labor costs associated with benefits and overhead. According to ECEC data benefits

compensation was equal to 42% of wages and salaries data for all industries and occupations. Overhead costs are assumed to be 

equal to 17% of wages (Rice 2002). 

Sources: U.S. Bureau of Labor Statistics 2010a, b, c, d, e 

2453 

2454 As shown in Table 2-69, none of the fabricators reported incurring any initial set-up costs for 

2455 recordkeeping, and only one of the nine reporting incurring recurring costs for recordkeeping as a result 

2456 of the CARB rule. (The remaining fabricators did not incur recordkeeping costs because their existing 

2457 records were sufficient to comply with the CARB requirements.) The one respondent with recurring 

2458 recordkeeping costs reported spending 10 hours per week on recordkeeping for the CARB rule. As 

2459 calculated in Table 2-69, EPA estimates that 10 hours per week is equivalent to a cost of $12,917 per 

2460 year. 

2461 

2462 This analysis assumes that the 11% of fabricators that are not already complying with the CARB 

2463 ATCM (because their products are not sold in California) incur an average cost of $12,917 per year to 

2464 comply with the recordkeeping requirements of the TSCA Title VI rule. (The average cost per firm is 
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May 1, 2013 2-119 

2465 used in calculating total costs, but as described in Chapter 5, the small entity analysis is based on an 

2466 estimate of recordkeeping costs that varies with firm size.) Because the recordkeeping requirements are 

2467 similar in the CARB rule and the TSCA Title VI rule, no additional recordkeeping costs are estimated for 

2468 fabricators that are already complying with the CARB ATCM. 

2469 

2470 As shown in Table 2-69, several of the respondents indicated that they already had labeling 

2471 systems in place and therefore they did not incur any significant costs associated with CARB’s labeling 

2472 requirements. However, this analysis assumes that these firms did in fact incur small costs associated 

2473 with making small changes to their labels. One of the firms that did report minor labeling costs reported 

2474 that it took “a few hours” to change over to using the new labels. The analysis assumes that “a few 

2475 hours” is 3 hours for the purpose of estimating costs. The analysis also assumes that 67% of firms that 

2476 are not already complying with the CARB ATCM, and all firms that are already complying with the 

2477 CARB ATCM, incur the costs associated with 3 labor hours (where 67% is calculated as 4/6, since 4 of 

2478 the 6 firms that reported labeling their products are assumed to have these costs). Two other firms that 

2479 responded to the questionnaire reported more substantial costs associated with setting up their labeling 

2480 systems and therefore, it is assumed that the remaining 33% of firms that are not already complying with 

2481 the CARB ATCM will incur the average costs reported by these two firms (where 33% is calculated as 

2482 2/6 since 6 firms reported that they labeled their products). 

2483 

2484 As shown in Table 2-70, four of the seven wholesalers reported incurring initial costs to revise 

2485 their recordkeeping systems to comply with the CARB rule. Only two of the four were able to quantify 

2486 the time or cost they spent revising their recordkeeping systems. Based on their responses, the average 

2487 cost of revising recordkeeping systems is estimated at $2,511. Thus, the analysis assumed that 57% of 

2488 wholesalers that are not already complying with the CARB ATCM will incur initial costs that average 

2489 $2,511 for revising recordkeeping systems to comply with the TSCA Title VI rule. The remaining 43% 

2490 of wholesalers that are not already complying with the CARB ATCM and all firms that are already 

2491 complying with the CARB ATCM are assumed to have recordkeeping systems that do not need to be 

2492 modified in order to comply with the TSCA Title VI rule, and thus do not incur significant initial 

2493 recordkeeping costs. Because the recordkeeping requirements are similar in the CARB rule and the 

2494 TSCA Title VI rule, no additional recordkeeping costs are estimated for wholesalers that are already 

2495 complying with the CARB rule. 

2496 

2497 Table 2-70 also indicates that three of the seven wholesalers reported incurring recurring 

2498 recordkeeping costs due to the CARB rule, but only one of them was able to quantify the additional time 

2499 spent on recordkeeping. That respondent reported spending half an hour to an hour per day on CARB2500 related recordkeeping. EPA estimates this is equivalent to a cost of $4,980 per year. Therefore, this 

2501 analysis assumes that 57% of the wholesalers that are not already complying with the CARB ATCM do 

2502 not incur significant recurring costs, as their existing recordkeeping practices are sufficient to comply 

2503 with the TSCA Title VI rule’s requirements. The remaining 43% of wholesalers that are not already 

2504 complying with the CARB ATCM incur a recurring cost for recordkeeping that averages $4,980 per year. 

2505 (As with fabricators, the average cost per firm is used in calculating total costs, but the small entity 

2506 analysis in Chapter 5 is based on an estimate of recordkeeping costs that varies with firm size.) Again, 

2507 because the recordkeeping requirements are similar in the CARB rule and the TSCA Title VI rule, no 

2508 additional recordkeeping costs are estimated for wholesalers that are already complying with the CARB 

2509 ATCM. 

2510 
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May 1, 2013 2-120 

Table 2-69: Responses and Estimates from Fabricator Recordkeeping and Labeling Questionnaire 

Survey 

ID 

Description by Fabricators of Recordkeeping and Labeling Costs EPA Estimate of 

Recordkeeping Costs

EPA Estimate of 

Labeling Costs 

Initial Recurring Initial Recurring 

Decorative Panel Manufacturers 

1 

Recordkeeping: No implementation cost; already a CPA member so 

upstream information was easy to acquire; keep records of all boards 

purchased that are CARB 2 compliant. 

Labeling: Few hours of labor for implementation (assumed to be 3 hours 

for this analysis); overhead cost minimum; no additional per-label cost; 

labeled by pallet. 

- - 

$132.81 (3 

hours 

multiplied by 

$44.27) 

- 

Stock Cabinet Manufacturers 

2 Recordkeeping: No implementation cost; 10 hours per week of 

recordkeeping maintenance costs; CARB compliance attained through 

KCMA guidance. 

Labeling: Nothing was changed; the firm was unaware of any 

requirements regarding labels. 

 - 

$12,916.80 

(10 hours/wk 

multiplied by 

52 weeks at 

$24.84) 

n.a. n.a. 

3 Recordkeeping: No implementation cost; must send vendor letters and 

keep invoices. 

Labeling: $250 implementation cost for purchasing two new stamps for 

labeling; no additional per-cost labelsper-label; every item is labeled. 

- - $250 - 

Custom Cabinet Manufacturers 

4 Recordkeeping: No implementation cost; must keep invoices. 

Labeling: Does not label. - - n.a. n.a. 

5 Recordkeeping: No implementation cost; products are formaldehyde 

free; they must keep track of invoices. 

Labeling: Do not label cabinet products. 

- - n.a. n.a. 

Household Furniture Manufacturers 

6 Recordkeeping: No implementation cost; letters from suppliers are filed.

Labeling: No extra cost; extra information required on each label, but 

they already had the necessary equipment to make the change; each item 

of upholstered furniture is labeled. 

- - No Cost 

Reported - 

7 Recordkeeping: No extra cost; only buys from suppliers that are CARB 

compliant and tracks invoices. 

Labeling: No costs; they were labeling already for other reasons such as 

FSC certification; barcodes on each product which say CARB 2 

compliant. 

- - No Cost 

Reported - 

Business and Institutional Furniture Manufacturers 

8 Recordkeeping: No implementation cost; must keep invoices for Forest 

Stewardship Council, CARB I, and CARB II. 

Labeling: Not a significant cost; made stickers for CARB certification; 

label each finished product. 

- - No Cost 

Reported 

- 

9 Recordkeeping: Unknown exact costs; must keep track of billing, 

modify purchase orders, store certificates from suppliers. 

Labeling: Initial cost of a “couple hundred man hours” (assumed to be 

200 hours for this analysis); internal process of changing drawings on 

labels; worked with BIFMA for labeling changes; no extra cost per-label

costs; labels applied by box/container, incorporated with shipping label. 

- - 

(200 hours 

multiplied 

by $44.27)

- 

Firms with More Substantive Costs 

Percent of firms reporting more substantive costs - 11% 2/6 = 33% - 

Average costs for firms with more substantive costs - $12,916.80 $4,552 - 

Firms with Minor Costs

Percent of firms assumed to incur minor costs - - 4/6=67% - 

Average costs for firms reporting minor costs - - $133 - 

Source: Revenue data from Dun & Bradstreet 2010. Wage rates from U.S. Bureau of Labor Statistics 2010b 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-121 

2511 

Table 2-70: Responses and Estimates from Wholesaler Recordkeeping Questionnaire

Survey 

ID 

Description by Retailers of Recordkeeping and Labeling 

Costs 

EPA Estimate of Recordkeeping Costs 

Initial Recurring 

Wood Product Wholesalers in California 

1 Implementation Cost: No significant cost; did not purchase 

another recordkeeping system. 

Recurring Cost: 0.5 to 1 hour per day; Practices to comply with 

CARB include: query reports to ensure everything is CARB 

specific; adding custom comments on purchase orders; 

paperwork for when they receive product; adding a field for 

vendor name and CARB phase in system. 

- 

$4,980.30 

(0.75 hours per day 

multiplied by 260 days 

multiplied by 

$25.54/hr) 

2 Implementation Cost: $2,000 for a small amount of labor; 

requires putting new line items (“stock-keeping units” or SKUs) 

in computer system. 

Recurring Cost: No additional cost. 

$2,000 - 

3 Implementation Cost: 40 labor hours and $2,000 in programming 

changes; requires changing tags and CARB-specific comment 

lines in already existing inventory tagging system. 

Recurring Cost: No additional cost. 

$3,021.60 

(40 hours multiplied 

by $25.54/hr plus 

$2,000) 

- 

4 Implementation Cost: Unknown; the IT department prints CARB 

information on each invoice and they are in the process of getting 

signed forms from suppliers (at 80% currently). 

Recurring Cost: Unknown. 

Costs incurred, could 

not quantify. 

Costs incurred, could 

not quantify. 

Household Furniture Wholesalers 

5 Implementation Cost: None; they only purchase from CARB-2 

certified firms, a dozen manufacturers; did not have to modify 

recordkeeping system. 

Recurring Cost: None. 

- - 

6 Implementation Cost: None; did not have to modify existing 

recordkeeping system. 

Recurring Cost: None. 

- -

7 Implementation Cost: Unknown 

Recurring Cost: Unknown; when purchasing the firm asks for 

CARB compliance phase II; keeps invoices; suppliers must 

submit compliance forms. 

Costs incurred, could 

not quantify. 

Costs incurred, could 

not quantify. 

Summary of Results 

Percent of firms reporting costs 57% 43% 

Average costs for firms reporting costs $2,510.80 $4,980.30 

Source: Revenue data from Dun & Bradstreet 2010. Wage rates from U.S. Bureau of Labor Statistics 2010d 

2512 

2513 2.5.2 Recordkeeping, Labeling, Supplier Notification, and Rule Familiarization Costs per 

2514 Firm 

2515 

2516 This section presents the total costs per fabricator, wholesaler, and retailer firm associated with 

2517 the recordkeeping and labeling requirements for the analytical options considered for the TSCA Title VI 

2518 rule. This analysis includes additional per firm costs to those that were reported in the questionnaire, 

2519 including costs associated with becoming familiar with the rule’s requirements and sending notification 

letters to suppliers.32 2520 Although no fabricator or wholesaler firms quantified any costs associated with 

 32 The CARB ATCM requires all firms that purchase composite wood products to obtain documentation from their 

suppliers that the products are in compliance with the rule. Such supplier notification is included in some of the 

analytical options considered for the TSCA Title VI rule, but it is not required by the proposed option (Option SCUR). 

The estimates here for the analytical options including supplier notification reflect the cost for purchasers to submit 

requests for documentation to their suppliers, and the cost for the suppliers to provide the documentation. 
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2521 sending notification letters to suppliers, several noted that this was necessary. Similarly, although no 

2522 respondents reported costs associated with learning about the rule, it will be necessary for each firm to 

2523 become familiar with it in order to determine whether they are subject to it, and if so, what steps will be 

2524 necessary to achieve compliance. It is assumed that the entire group of affected composite panel 

2525 producer, fabricator, wholesaler, and retailer firms will incur costs for both rule familiarization and 

2526 supplier notification. In summary, the following initial costs will be incurred in response to recordkeeping 

2527 and labeling requirements: (1) rule familiarization; (2) supplier notification; (2) labeling system setup; 

2528 and (3) recordkeeping system setup. There will also be recurring costs estimated on an annual basis for 

2529 maintaining records. These costs are described in more detail in the sections below. 

2530 

2531 2.5.2.1 Rule Familiarization and Supplier Notification Costs 

2532 

2533 It is expected that all composite panel producer, fabricator, wood veneer laminated product 

2534 producer, wholesaler, and retailer firms, will need to spend time familiarizing themselves with the 

2535 regulation and either ensuring that their current systems are sufficient for the TSCA Title VI rule’s 

2536 requirements or identifying necessary changes. It is assumed that every firm will require four managerial 

2537 labor hours of initial rule familiarization costs. These per-firm rule familiarization costs are estimated by 

2538 industry in Table 2-71. 

2539 

Table 2-71: Per-Firm Rule Familiarization Costs 

Industry Rule Familiarization 

Labor (hours) 

Managerial Occupations 

Wage Rate 

Rule Familiarization 

Cost Per Firm 

Stock Composite Panel Producers 4.0 $73.60 $294.40 

Fabricators and Laminators 4.0 $73.60 $294.40 

Wholesalers 4.0 $93.29 $373.16 

Retailers 4.0 $70.71 $282.84 

Sources: U.S. Bureau of Labor Statistics 2010b, c, d 

2540 

2541 It is assumed that all affected fabricator, wood veneer laminated product producer, wholesaler, 

2542 and retailer firms that are not compliant with the CARB ATCM in the baseline will also incur costs for 

2543 sending notification letters to all of their composite wood product suppliers. The composite wood 

2544 product suppliers will conversely need to respond to all downstream firms requesting confirmation of 

2545 compliance with the TSCA Title VI rule’s requirements. Those firms that already comply with the 

2546 CARB ATCM in the baseline are assumed to already be maintaining supplier agreements that can be used 

2547 to meet the TSCA Title VI rule’s supplier notification requirements without incurring additional costs. It 

2548 is assumed that each retailer entity will need to send notification letters to a total of 40 suppliers. 

2549 Fabricators and wholesalers are assumed to send notification letters to 20 suppliers. Notification 

2550 responses are estimated by assuming that notification letters from downstream firms are distributed 

2551 equally across the upstream firms. Each upstream firm is assumed to respond to the notification letters it 

2552 receives (see Table 2-72 for the average number of notification and response letters sent by industry). 

2553 

2554 Supplier notification requires both material and labor costs. The material costs for each supplier 

2555 letter include: $0.10 for a printed letter, $0.02 for an envelope, and $0.44 for a stamp for a total of $0.56 

2556 in material costs per supplier letter. In terms of letter production and mailing, it is assumed that this 

2557 activity will require 2 hours of initial labor plus one minute of labor for each supplier notification letter or 

2558 response letter sent. The labor costs are estimated using the industry-specific fully loaded wages for the 

2559 “office and administrative support” occupation (See Table 2-68). Supplier notification cost elements per 

2560 fabricator, wholesaler, retailer, and composite panel producer firms are presented in Table 2-72 below. 

2561 The total per-firm costs is calculated as the sum of (1) material costs and (2) the number of labor hours 

2562 required multiplied by the fully loaded hourly wage. 

2563 
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May 1, 2013 2-123 

Table 2-72: Per-Firm Supplier Notification and Response Costs

Industry 

Notification 

Letters 

Sent Per 

Firm 

Notification 

Letter 

Responses 

Per Firm 

Total 

Letters Per 

Firm 

Estimated 

Labor 

Burden Per 

Firm 

(hours) 

Estimated 

Material 

Cost Per 

Firm ($0.56 

per letter) 

Office and 

Administrative 

Support Wage 

Total PerFirm Cost 

Composite 

Panel 

Producersa

 0 295 295 6.9 $165.20 $24.84 $336.60 

Fabricators 

and 

Laminators 20 282 302 7.0 $169.12 $24.84 $343.00 

Wholesalers 20 277 297 7.0 $166.32 $25.54 $345.10 

Retailers 40 0 40 2.7 $22.40 $19.32 $74.56 

Sources: U.S. Bureau of Labor Statistics 2010a, b, d, United States Postal Service 2011 

2564 

2565 2.5.2.2 Labeling Costs 

2566 

2567 Fabricators must label every finished good they produce, or every box containing finished goods, 

2568 with the fabricator’s name, the date the finished good was produced, and a statement of compliance. 

2569 Because this is similar to the labeling requirement in the CARB ATCM, the average labeling costs for 

2570 fabricators are estimated based on the questionnaire results and presented in Table 2-69 of the previous 

2571 section. Based on the questionnaire results, it is estimated that 33% of fabricators who are not already 

2572 complying with the CARB ATCM (because their products are not sold in California) will incur average 

2573 incremental costs of $4,552 in the first year to change their labels, and all other fabricators will incur an 

2574 average incremental cost of $132.81. Since none of the fabricators that took part in the telephone 

2575 questionnaire reported any recurring costs for labeling, no recurring labeling costs are estimated. 

2576 

2577 It is assumed that 1 percent of wholesalers incur labeling costs, either because they are 

2578 repackaging goods that were originally labeled on the packaging instead of on the individual items, or 

2579 because they are replacing an original label applied by the panel producer or fabricator with a label listing 

2580 a different company name. It is also assumed that these wholesalers incur the same costs as the 

2581 fabricators who are assumed to incur more substantial initial labeling costs (an average of $4,552). 

2582 

2583 It is assumed that panel producers, for whom product labeling is a customary business practice, 

2584 will incur the incremental costs of 6 hours for changing their labels twice. They may need to change their 

2585 labels once before the effective date of the rule (to indicate that the panels were produced before that date 

2586 if they are to be sold after the rule goes into effect) and again after their product lines are certified. The 

2587 first label change may be needed.

2588 

Table 2-73: Summary of Average Labeling Setup Costs Per-Firm

Firm Type Average Initial Costs 

Low High 

Panel Producers (excl. laminators defined as hardwood plywood 

producers) $149.04 

Laminators defined as hardwood plywood producers $4,552.00 

Fabricators (includingexcluding laminators defined as 

fabricators) $132.81 $4,552.00 

Wholesalers $4,552.00 -

Retailers - - 

2589 

2590 

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2591 
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May 1, 2013 2-125 

2592 2.5.2.3 Recordkeeping Costs 

2593 

2594 Under the CARB ATCM, fabricators, importers, distributors, and wholesalers are required to take 

2595 “reasonable precautions” to ensure that the composite wood products and finished goods they acquire are 

2596 in compliance with the applicable emission standards. This includes instructing each supplier that the 

2597 product supplied must comply with applicable emissions standards, and obtaining written documentation 

2598 stating that. In addition, these firms must keep records showing the date of purchase, the supplier, as well 

2599 as all precautions taken to ensure that the product meets emissions standards. These records must be kept 

2600 for two years. The TSCA Title VI rule requires that records be kept for fivethree years but this is not 

2601 expected to significantly affect the costs to regulated entities, so the cost of the additional recordkeeping 

2602 has not been estimated. 

2603 

2604 The average initial and recurring recordkeeping costs for fabricators and wholesalers are 

2605 estimated based on the questionnaire results and presented above in Table 2-69 and Table 2-70 above. 

2606 Based on the questionnaire results, typical fabricators are not estimated to incur initial costs for 

2607 recordkeeping, because their existing recordkeeping systems are adequate and do not need to be modified 

2608 to comply with the TSCA Title VI requirements. It is estimated that 11% of the fabricators that are not 

2609 currently complying with the CARB ATCM because their products are not sold in California will incur 

2610 additional recurring recordkeeping costs. 

2611 

2612 The single fabricator questionnaire respondent that reported incurring recurring recordkeeping 

2613 costs indicated that their recurring recordkeeping burden associated with the CARB ATCM was about 10 

2614 hours per week, which this analysis estimates to be about $12,917 per year (see Table 2-69). However, 

2615 the burden reported by this fabricator questionnaire respondent seems unlikely to be representative for all 

2616 the fabricator firms that incur a recurring recordkeeping burden. This fabricator questionnaire respondent 

2617 was a firm with employees, but smaller firms, such as nonemployer firms, are likely to need much less 

2618 time than 10 hours per week (about a quarter of a 40 hour work week) to perform the necessary 

2619 recordkeeping activities. Since the recordkeeping requirements entail keeping track of composite wood 

2620 materials purchased and shipments that contain composite wood products, it is expected that the burden 

2621 associated with keeping records will typically increase with the volume of a fabricator’s sales. Thus, to 

2622 estimate the recurring recordkeeping burden for nonemployer fabricators, the analysis assumes that there 

2623 is a fixed-cost component of the recurring recordkeeping costs associated with two hours of labor and a 

2624 variable cost component that is proportional to a firm’s revenue. 

2625 

2626 For fabricator employer firms, the recurring recordkeeping cost is assumed to be comprised of a 

2627 fixed cost component of $49.68 (based on the cost of 2 hours of labor at fabricator firms) and a variable 

2628 cost component of 0.30338 percent of revenue (calculated by subtracting $49.68 from $12,917 and then 

2629 dividing by $4,241,245, the estimated average revenue for affected employer fabricators). The average 

2630 recurring recordkeeping cost for fabricator nonemployer firms is then estimated as the sum of 49.68 and 

2631 0.30338 percent of average nonemployer firm revenues ($42,690). The resulting average fabricator 

2632 nonemployer firm recurring recordkeeping cost is $179.19 per year. 

2633 

2634 Recurring recordkeeping costs are estimated similarly for wholesale firms. It is estimated that 

2635 43% of wholesalers that are not currently complying with the CARB ATCM (because their products are 

2636 not sold in California) will incur additional recurring costs (see Table 2-70). The costs to those 

2637 wholesalers with recurring recordkeeping costs are estimated based on the wholesaler questionnaire. The 

2638 single wholesaler questionnaire respondent that reported incurring recurring recordkeeping costs indicated 

2639 that their recurring recordkeeping burden associated with the CARB ATCM was about forty five minutes 

2640 per day, which this analysis estimates to be about $4,980.30 per year (see Table 2-70). However, the 

2641 burden reported by this wholesaler questionnaire respondent seems unlikely to be representative for all 

2642 the wholesaler firms that incur a recurring recordkeeping burden. This wholesaler questionnaire 
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May 1, 2013 2-126 

2643 respondent was a firm with employees, but smaller firms such as nonemployer firms, are likely to need 

2644 much less time than 3.75 hours per week (nearly 10% of a 40 hour work week) to perform the necessary 

2645 recordkeeping activities. Since the recordkeeping requirements entail keeping track of composite wood 

2646 materials purchased and shipments that contain composite wood products, it is expected that the burden 

2647 associated with keeping records will typically increase with the volume of a wholesaler’s sales. Thus, to 

2648 estimate the recurring recordkeeping burden for nonemployer wholesalers, the analysis assumes that there 

2649 is a fixed-cost component of the recurring recordkeeping costs associated with two hours of labor and a 

2650 variable cost component that is proportional to a firm’s revenue. 

2651 

2652 For employer firms, the recurring recordkeeping cost is assumed to be comprised of a fixed cost 

2653 component of $51.08 (based on the cost of 2 hours of labor at wholesaler firms) and a variable cost 

2654 component of 0.05933 percent of revenue (calculated by subtracting $51.08 from $4,980.30 and then 

2655 dividing by $8,308,417, the estimated average revenue for affected employer wholesalers). The average 

2656 recurring recordkeeping cost for nonemployer firms is then estimated as the sum of 51.08 and 0.05933 

2657 percent of average nonemployer revenues ($82,542). The resulting average wholesaler nonemployer 

2658 recurring recordkeeping cost is $100.05 per year. 

2659 

2660 It is estimated that 57% of the wholesalers that are not currently complying with the CARB 

2661 ATCM (because their products are not sold in California) will incur an initial cost of $2,511 to change 

2662 their recordkeeping systems, and that these costs will average $2,511 for both employer and nonemployer 

2663 firms. It is assumed that the remaining wholesalers do not have to upgrade their recordkeeping systems in 

2664 order to complying with the recordkeeping requirements. 

2665 

2666 Panel producers are assumed to incur an average labor burden of one hour per week (equivalent 

2667 to $3,710.72 per year) to maintain the following records for 53 years: 

2668 

2669  Records of quarterly emission testing and quality control testing that identify the 

2670 accredited third-party certifier conducting or overseeing the testing and the laboratory or 

2671 quality control facility actually performing the testing. These records must also include 

2672 the date, the product type tested, the lot or batch number that the tested material 

2673 represents, the test method used, and the test results; 

2674  Production records, including a description of the composite wood product(s), the date of 

2675 manufacture, lot or batch numbers, the amount of resin use by volume and weight, the 

2676 resin trade name, resin manufacturer and supplier contact information, and tracking 

2677 information allowing each product to be traced to a specific lot number or batch 

2678 produced; 

2679  Records demonstrating initial and continued eligibility for the reduced testing provisions 

2680 for products made with no-added formaldehyde-based resins, if applicable; 

2681  Records of changes in production, including changes in resin use, resin composition, and 

2682 changes in the process, such as changes in press time; 

2683  Purchaser information for each composite wood product, if applicable, including the 

2684 name, contact person, address, phone number, e-mail address if available, purchase order 

2685 or invoice number, and amount purchased; 

2686  Transporter information for each composite wood product, if applicable, including name, 

2687 contact person, address, phone number, e-mail address if available, and shipping invoice 

2688 number; 

2689  Information on the disposition of non-complying lots, including product type and amount 

2690 of composite wood products affected, lot or batch numbers, mitigation measures used, 

2691 results of retesting, and final disposition; 

2692  Copies of labels used; 
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May 1, 2013 2-127 

2693  Panel producers are required to maintain an up-to-date quality control manual on their 

2694 premises; and 

2695  Panel producers are required to maintain the credentials of their quality control managers 

2696 and quality control employees for as long as employees are serving in a quality control 

2697 capacity. 

2698 

Table 2-74: Summary of Average Recordkeeping Costs Per-Firm

Firm Type Average Recordkeeping Costs 

Initial Costs Recurring Costs 

Panel Producers (excl. laminators defined as hardwood plywood producers) - $3,710.72 

Laminators defined as hardwood 

plywood producersaproducers

-Employer firms a

- $16,627.52 

Nonemployer firms b - $3,889.91

Fabricators (including laminators 

defined as fabricators) 

All firms that comply with CARB 

ATCM in baseline and 89% of firms 

that do not comply with CARB 

ATCM in baselineb

baselinec - - 

11% of employer firms that do not 

comply with CARB ATCM in 

baselineb

baselinec - $12,916.80 

11% of nonemployer firms that do 

not comply with CARB ATCM in 

baselineb

baselinec - $179.19 

Wholesalers 

All firms that comply with CARB 

ATCM in baseline and 57% (for 

initial costs) and 43% (for recurring 

costs) of firms that do not comply 

with CARB ATCM in 

baselineb

baselinec - - 

57% (for initial costs) and 43% (for 

recurring costs) of employer firms 

that do not comply with CARB 

ATCM in baselineb

baselinec $2,510,.80 $4,890980.30 

57% (for initial costs) and 43% (for 

recurring costs) of nonemployer 

firms that do not comply with 

CARB ATCM in baselineb

baselinec $2,510,.80 $100.05 

Retailers - - 

a $16,627.52= 12,916.80 (employer firm fabricator recordkeeping cost) + $3,710.72 (panel producer recordkeeping cost) bb $3,889.91= 179.19 (nonemployer firm fabricator recordkeeping cost) + $3,710.72 (panel producer recordkeeping cost) c Firms may not comply with the CARB ATCM in the baseline if they do not sell products in California. 

2699 

2700 

2701 2.5.3 Number of Affected Entities 

2702 

2703 Several industries are already universally following the recordkeeping and labeling requirements 

2704 under the CARB rule, while other industries have not experienced widespread implementation of these 

2705 practices. In general, those industries that tend to distribute their products nationally have implemented 

2706 recordkeeping and labeling systems to comply with CARB, while regional operations generally have not. 

2707 

Merged Cells

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2708 Discussions with industry experts informed the baseline compliance assumptions for most 

fabricators as well as all furniture wholesalers.33 2709 For the remaining fabricators baseline compliance was 

2710 estimated as the percentage of total U.S. establishments located in California. For retail and wholesale 

2711 firms, baseline compliance was estimated as the percentage of firms with at least one establishment 

2712 located in California. Since all affected composite wood product producers will need to familiarize 

2713 themselves with the rule as well as respond to all supplier notification letters, baseline compliance with 

2714 the CARB regulation does not need to be determined. 

2715 

2716 2.5.3.1 Baseline CARB Compliance ofPercentages for Fabricator and Wood Veneer Laminated 

2717 Product Industries 

2718 

2719 Many fabricators are already complying with the recordkeeping and labeling requirements of the 

2720 CARB ATCM and therefore would not incur any incremental costs for putting these systems in place to 

2721 comply with the TSCA Title VI rule. The baseline level of CARB compliance for most fabricator and 

2722 wood veneer laminated product industries was determined based on conversations with industry 

associations.34 2723 However, baseline compliance for some fabricator and wood veneer laminated product 

2724 industries was estimated simply as the number of employer establishments located in California divided 

2725 by the total number of U.S. employer establishments in each industry. The estimated baseline CARB 

2726 compliance levels for fabricators and wood veneer laminated product producers are presented below in 

2727 Table 2-75. 

2728 

2729 

2730 

 33 Conversations with Industry (Personal Communication with AHFA 2010, Personal Communication with BIFMA 

2010, Personal Communication with KCMA 2010, Personal Communication with NALFA 2010) informed assumptions 

for the following NAICS codes: 321211, 321219, 337110, 337129, 321911, 337121, 337122, 337127, 337211, 337214, 

337215, 336213, 336214, 423210, 423220. 

34 Conversations with Industry represented informed assumptions for the following fabricator NAICS codes: 321211, 

321219, 337110, 337129, 321911, 337121, 337122, 337127, 337211, 337214, 337215, 336213, and 336214. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-129 

Table 2-75:: Percentage of Baseline CARB Compliance of Fabricator and Wood Veneer Laminated 

Product Producer Industries, by Affected NAICS 

NAIC

S NAICS Definition 

CA 

Estab.

Estab. 

Outsi

de CA

Total 

U.S. 

Estab.

Baseline 

CARB 

Complian

ce 

Basis for Estimate or Assumption

3212

11 

Hardwood Veneer and Plywood 

Manufacturing 

- - - 100% (Personal Communication with 

HPVA 2011a)

32121

9

Reconstituted Wood Product Manufacturing - - - 100%

3371

10 

Wood Kitchen Cabinet and 

Countertop Manufacturing 

- - - 50% (Personal Communication with 

KCMA 2010)

3371

29 

Wood Television, Radio, and 

Sewing Machine Cabinet 

Manufacturing 

- - -

50% 

Assumed to be similar to kitchen 

cabinet and countertop 

manufacturing.

3219

11 

Wood Window and Door 

Manufacturing 

- - - 100% Assumed to be 100%.

3371

21 

Upholstered House Furniture 

Manufacturing 

- - - 100% (Personal Communication with 

AHFA 2010)

3371

22 

Non-upholstered Wood 

Household Furniture 

Manufacturing 

- - -

100% (Personal Communication with 

AHFA 2010)

3371

24 

Metal Household Furniture 

Manufacturing 

- - - 100% Personal Communication with AHFA 

2010

3371

27 

Institutional Furniture 

Manufacturing 

- - - 100% (Personal Communication with 

BIFMA 2010)

3372

11 

Wood Office Furniture 

Manufacturing 

- - - 100% (Personal Communication with 

BIFMA 2010)

3372

14 

Office Furniture (except Wood) 

Manufacturing 

- - - 100% (Personal Communication with 

BIFMA 2010)

3372

15 

Showcase, Partition, Shelving, 

and Locker Manufacturing 

- - - 100% Assumed to be similar to furniture 

manufacturing.

3219

18 

Other Millwork (including 

Flooring) 

194 1,907 2,101 9.23% % of Estab. in CA (U.S. Census 

Bureau 2010a)

3372

12 

Custom Architectural Woodwork 

and Millwork 

219 2,009 2,228 9.83% % of Estab. in CA (U.S. Census 

Bureau 2010a)

3219

99 

All Other Miscellaneous Wood 

Product Manufacturing 

154 1,810 1,964 7.84% % of Estab. in CA (U.S. Census 

Bureau 2010a)

3362

13 

Motor Home Manufacturing - - - 100% Assumed to be 100%.

3362

14 

Travel Trailer and Camper - - - 100% Assumed to be 100%.

3219

91 

Manufactured Home (Mobile 

Home) Manufacturing 

41 335 376 10.90% % of Estab. in CA (U.S. Census 

Bureau 2010a)

3219

92 

Prefabricated Building 

Manufacturing 

48 763 811 5.92% % of Estab. in CA (U.S. Census 

Bureau 2010a)

3399

50 

Sign Manufacturing 644 5,739 6,383 10.09% % of Estab. in CA (U.S. Census 

Bureau 2010a)

Sources: U.S. Census Bureau 2009b, 2010f

2731 

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Inserted Cells
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May 1, 2013 2-130 

2732 2.5.3.2 Baseline CARB Compliance of Retailer and Wholesaler Industries 

2733 

2734 This analysis assumes that retail and wholesale firms with establishments in California are 

2735 complying with the recordkeeping and labeling requirements of the CARB ATCM and therefore would 

2736 not incur any incremental costs for putting these systems in place to comply with the TSCA Title VI 

2737 proposed rule. Because retailers make the large majority of their sales in the same states where they have 

2738 physical locations it is not likely that many retailers without California locations have established chain of 

2739 custody systems to meet the CARB ATCM’s requirements. Wholesalers are more likely than retailers to 

2740 sell products in states where they do not have physical locations. Thus, this assumption may lead to an 

2741 understatement of the level of baseline compliance among wholesalers. Note that two wholesale 

2742 industries, Furniture Merchant Wholesalers (423210) and Home Furnishing Merchant Wholesalers 

2743 (423220) are instead assumed to be fully compliant with the CARB ATCM chain of custody requirements 

in the baseline.35 2744 

2745 

2746 Because data on the number of firms with at least one establishment in California are not 

2747 available, the following steps must be taken to estimate baseline compliance for each affected industry: 

2748 (1) use 2007 Economic Census data to identify the number of affected retail and wholesale firms (U.S. 

2749 Census Bureau 2009a, 2010b, d, o, p); (2) estimate the number of single-unit firms in California; (3) 

2750 estimate the number of multi-unit firms with at least one establishment in California; and (4) estimate 

2751 baseline compliance as the percentage of U.S. firms with at least one establishment in California. 

2752 

2753 Figure 2-5 presents an example to demonstrate how the numbers of single-unit firms located in 

2754 California are estimated. 

2755 

 35 These assumptions are based on two sources: (Personal Communication with AHFA 2010, Personal Communication 

with BIFMA 2010). 
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May 1, 2013 2-131 

Figure 2-5: Example Methodology for Estimating the Number of Single-Unit Firms in California 

(NAICS 441210) 

2756 and present the estimated number of single-unit establishments located in California for all 

2757 affected wholesaler and retailer industries. 

2758 

2759 

2760 

Table 2-74: The Number of Single-Unit Wholesaler Establishments in California, by Affected NAICS

NAICS NAICS Description

All U.S. 

Estab. in 

Affected 

NAICS 

U.S. 

SingleUnit 

Estab.

Percent of 

U.S. Estab. 

that are 

Single Unit

All CA 

Estab.

CA 

SingleUnit 

Estab.

423310

Lumber, plywood, millwork, and wood panel merchant 

wholesalers

8,984 5,587 62.2% 836 520

423320

Brick, stone, and related construction material merchant 

wholesalers

4,107 2,413 58.8% 447 263

423330 Roofing, siding, and insulation material merchant wholesalers 2,804 862 30.7% 175 54

423390 Other construction material merchant wholesalers 3,767 2,122 56.3% 394 222

423410 Photographic equipment and supplies merchant wholesalers 1,062 767 72.2% 230 166

423420 Office equipment merchant wholesalers 6,415 2,509 39.1% 676 264

423430 Computer and software merchant wholesalers 11,545 7,689 66.6% 2,265 1,508

423440 Other commercial equipment merchant wholesalers 4,444 3,600 81.0% 521 422

423450 Medical equipment merchant wholesalers 8,601 6,718 78.1% 1,194 933

423490

Other professional equipment and supplies merchant 

wholesalers

2,380 1,804 75.8% 309 234
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Table 2-74: The Number of Single-Unit Wholesaler Establishments in California, by Affected NAICS

NAICS NAICS Description

All U.S. 

Estab. in 

Affected 

NAICS 

U.S. 

SingleUnit 

Estab.

Percent of 

U.S. Estab. 

that are 

Single Unit

All CA 

Estab.

CA 

SingleUnit 

Estab.

423510 Metal service centers and other metal merchant wholesalers 10,831 6,867 63.4% 1,273 807

423610 Elec. equip. and wiring merchant wholesalers 13,948 7,553 54.2% 1,910 1,034

423620 Electric appliance merchant wholesalers 3,149 2,260 71.8% 685 492

423690 Other electronic parts and equipment merchant wholesalers 13,991 9,329 66.7% 3,015 2,010

423710 Hardware merchant wholesalers 6,986 4,581 65.6% 1,082 710

423720 Plumbing equip. merchant wholesalers 7,027 3,013 42.9% 806 346

423730 HVAC equip. merchant wholesalers 5,376 1,826 34.0% 387 131

423740 Refrigeration equipment and supplies merchant wholesalers 1,318 625 47.4% 196 93

423810 Construction equipment merchant wholesalers 4,904 2,432 49.6% 369 183

423820

Farm and garden machinery and equipment merchant 

wholesalers

8,405 5,395 64.2% 621 399

423830 Industrial machinery and equipment merchant wholesalers 31,380 21,477 68.4% 3,111 2,129

423840 Industrial supplies merchant wholesalers 8,850 4,855 54.9% 1,018 558

423850

Service establishment equipment and supplies merchant 

wholesalers

4,719 3,258 69.0% 373 258

423910

Sporting and recreational goods and supplies merchant 

wholesalers

6,278 5,300 84.4% 1,224 1,033

423920 Toy and hobby goods and supplies merchant wholesalers 2,504 2,262 90.3% 741 669

423930 Recyclable material merchant wholesalers 7,377 5,697 77.2% 850 656

423940 Jewelry merchant wholesalers 7,806 7,383 94.6% 1,495 1,414

423990 Other miscellaneous durable goods merchant wholesalers 10,270 8,877 86.4% 1,723 1,489

424110 Printing and writing paper merchant wholesalers 1,291 698 54.1% 161 87

424120 Stationery and office supplies merchant wholesalers 5,865 4,217 71.9% 733 527

424130 Industrial and personal service paper merchant wholesalers 4,939 3,644 73.8% 727 536

424210 Drugs and druggists' sundries merchant wholesalers 8,535 5,695 66.7% 1,504 1,004

424310 Piece goods, notions, and other dry goods merchant wholesalers 3,532 2,906 82.3% 967 796

424320 Men's and boys' clothing and furnishings merchant wholesalers 4,252 3,634 85.5% 984 841

424330 Women's and children's clothing merchant wholesalers 7,674 6,823 88.9% 2,357 2,096

424340 Footwear merchant wholesalers 1,659 1,446 87.2% 525 458

424410 General line grocery merchant wholesalers 2,547 2,025 79.5% 449 357

424420 Packaged frozen food merchant wholesalers 3,502 2,702 77.2% 606 468

424450 Confectionery merchant wholesalers 2,191 1,650 75.3% 282 212

424460 Fish and seafood merchant wholesalers 2,022 1,806 89.3% 238 213

424480 Fresh fruit and vegetable merchant wholesalers 5,074 4,323 85.2% 1,102 939

424490 Other grocery and related products merchant wholesalers 13,068 8,943 68.4% 2,011 1,376

424510 Grain and field bean merchant wholesalers 4,851 1,801 37.1% 133 49

424610

Plastics materials and basic forms and shapes merchant 

wholesaler

3,420 2,368 69.2% 516 357

424690 Other chemical and allied products merchant wholesalers 10,138 5,681 56.0% 965 541

424910 Farm supplies merchant wholesalers 7,738 3,786 48.9% 649 318

424920 Book, periodical, and newspaper merchant wholesalers 2,813 1,816 64.6% 360 232

424930 Flower, nursery stock, & florists' supplies merchant wholesalers 4,218 3,320 78.7% 671 528

424940 Tobacco and tobacco product merchant wholesalers 1,370 1,017 74.2% 94 70

424950 Paint, varnish, and supplies merchant wholesalers 2,060 924 44.9% 235 105

424990 Other miscellaneous nondurable goods merchant wholesalers 12,634 11,549 91.4% 2,980 2,724

Total Wholesalers in Affected NAICS 324,621 219,835 47,175 33,831

Sources: U.S. Census Bureau 2010a, b

2761 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-133 

Table 2-75: The Number of Single-Unit Retailer Establishments in California, by Affected NAICS

NAICS NAICS Description

All U.S. 

Estab. in 

Affected 

NAICS

U.S. 

SingleUnit 

Estab.

Percent of 

U.S. 

Estab. that 

are Single 

Unit

All CA 

Estab.

CA 

SingleUnit 

Estab.

441110 New car dealers 24,888 19,495 78.3% 2,516 1,970

441210 Recreational vehicle dealers 3,100 2,530 81.6% 325 265

441221 Motorcycle, ATV, and personal watercraft dealers 6,137 5,492 89.5% 620 555

441229 All other motor vehicle dealers 2,266 2,042 90.1% 229 206

441320 Tire dealers 20,127 10,445 51.9% 2,034 1,056

442110 Furniture stores 28,834 17,829 61.8% 3,308 2,045

442210 Floor covering stores 14,534 12,186 83.8% 1,471 1,233

442291 Window treatment stores 2,652 2,196 82.8% 358 296

442299 All other home furnishings stores 19,124 10,994 57.5% 2,274 1,307

443111 Household appliance stores 9,336 7,216 77.3% 843 652

443112 Radio, television, and other electronics stores 29,051 13,741 47.3% 3,478 1,645

443120 Computer and software stores 10,428 5,385 51.6% 1,307 675

443130 Camera and photographic supplies stores 1,988 699 35.2% 201 71

444110 Home centers 6,953 2,330 33.5% 585 196

444120 Paint and wallpaper stores 7,860 2,085 26.5% 734 195

444130 Hardware stores 16,454 11,289 68.6% 1,241 851

444190 Other building material dealers 39,551 27,231 68.9% 3,909 2,691

444210 Outdoor power equipment stores 4,357 3,916 89.9% 236 212

444220 Nursery, garden center, and farm supply stores 15,895 11,640 73.2% 1,138 833

445110 Supermarkets and other grocery (except convenience) stores 64,881 39,878 61.5% 7,824 4,809

445120 Convenience stores 25,510 21,529 84.4% 2,578 2,176

445210 Meat markets 6,009 5,339 88.9% 607 540

445220 Fish and seafood markets 2,063 1,954 94.7% 209 198

445230 Fruit and vegetable markets 2,938 2,780 94.6% 297 281

445291 Baked goods stores 4,290 3,001 70.0% 434 303

445292 Confectionery and nut stores 3,404 1,990 58.5% 344 201

445299 All other specialty food stores 5,504 4,057 73.7% 556 410

445310 Beer, wine, and liquor stores 31,485 26,292 83.5% 3,182 2,657

446110 Pharmacies and drug stores 42,045 17,710 42.1% 4,250 1,790

446120 Cosmetics, beauty supplies, and perfume stores 13,584 6,679 49.2% 1,373 675

446130 Optical goods stores 13,149 4,977 37.9% 1,329 503

446191 Food (health) supplement stores 8,999 4,928 54.8% 910 498

446199 All other health and personal care stores 10,675 6,835 64.0% 1,079 691

447110 Gasoline stations with convenience stores 97,508 49,010 50.3% 9,856 4,954

447190 Other gasoline stations 21,248 13,700 64.5% 2,148 1,385

448110 Men's clothing stores 8,321 4,533 54.5% 1,082 589

448120 Women's clothing stores 36,220 12,832 35.4% 4,419 1,566

448130 Children's and infants' clothing stores 7,102 2,611 36.8% 853 314

448140 Family clothing stores 28,254 7,618 27.0% 3,540 954

448150 Clothing accessories stores 7,494 3,488 46.5% 917 427

448190 Other clothing stores 12,034 7,430 61.7% 1,394 861

448210 Shoe stores 28,076 6,147 21.9% 2,838 621

448310 Jewelry stores 27,745 18,015 64.9% 3,269 2,123

448320 Luggage and leather goods stores 1,222 561 45.9% 124 57

451110 Sporting goods stores 22,254 16,485 74.1% 2,510 1,859

451120 Hobby, toy, and game stores 9,357 5,489 58.7% 1,028 603

451130 Sewing, needlework, and piece goods stores 5,663 4,001 70.7% 632 447

451140 Musical instrument and supplies stores 4,510 3,301 73.2% 456 334
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-134 

Table 2-75: The Number of Single-Unit Retailer Establishments in California, by Affected NAICS

NAICS NAICS Description

All U.S. 

Estab. in 

Affected 

NAICS

U.S. 

SingleUnit 

Estab.

Percent of 

U.S. 

Estab. that 

are Single 

Unit

All CA 

Estab.

CA 

SingleUnit 

Estab.

451211 Book stores 9,955 4,291 43.1% 1,006 434

451212 News dealers and newsstands 1,523 1,239 81.4% 154 125

451220 Prerecorded tape, compact disc, and record stores 4,153 2,176 52.4% 420 220

452111 Department stores (except discount department stores) 3,533 7 0.2% 437 1

452112 Discount department stores 5,001 4 0.1% 568 0

452910 Warehouse clubs and supercenters 4,260 1 0.0% 185 0

452990 All other general merchandise stores 33,061 8,473 25.6% 1,897 486

453110 Florists 19,822 18,465 93.2% 1,754 1,634

453210 Office supplies and stationery stores 9,558 4,948 51.8% 1,220 632

453220 Gift, novelty, and souvenir stores 31,391 22,652 72.2% 3,295 2,378

453910 Pet and pet supplies stores 8,782 5,643 64.3% 888 570

453920 Art dealers 6,677 6,183 92.6% 880 815

453930 Manufactured (mobile) home dealers 3,878 2,489 64.2% 210 135

453991 Tobacco stores 6,539 4,511 69.0% 661 456

453998 All other miscellaneous store retailers (except tobacco stores) 17,270 13,940 80.7% 1,746 1,409

454111 Electronic shopping 14,185 13,212 93.1% 1,434 1,335

454113 Mail-order houses 7,324 5,956 81.3% 740 602

454210 Vending machine operators 5,194 4,487 86.4% 525 454

454311 Heating oil dealers 4,055 3,078 75.9% 410 311

454312 Liquefied petroleum gas (bottled gas) dealers 5,980 1,845 30.9% 604 186

454390 Other direct selling establishments 22,077 19,545 88.5% 2,282 2,020

Total Retailers in Affected NAICS 994,667 580,145 103,598 60,411

Sources: U.S. Census Bureau 1997, 2010d, g, h

2762 

2763 The method for estimating the number of multi-unit firms with an establishment located in 

2764 California is demonstrated in Figure 2-6. The average U.S. number of establishments per multi-unit firm 

2765 and the probability of a U.S. establishment not being located in California can be combined to estimate 

2766 the probability that a U.S. firm has at least one establishment located in California. Applying this 

2767 probability to the total number of U.S. multi-unit firms, the number of multi-unit firms with an 

2768 establishment in California is then estimated. 

2769 

2770 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-135 

Figure 2-6: Example Methodology for Estimating the Number of Multi-Unit Firms with an 

Establishment in California (NAICS 441210) 

2771 

2772 The estimated numbers of multi-unit firms with at least one California establishment are 

2773 presented for each affected industry in for wholesaler firms and for retailer firms. 

2774 

Table 2-76: Number of Multi-Unit Wholesaler Firms with a California Establishment, by 

Affected NAICS

NAICS NAICS Description

U.S. 

Number of 

Estab. per 

Multi-Unit 

Firm

Probability 

an Estab. is 

not in CA

Probability 

Firm has 

an Estab. 

in CA

Number 

of CA 

MultiUnit 

Firms

423310

Lumber, plywood, millwork, and wood panel merchant 

wholesalers

3.8 90.7% 31.2% 277

423320

Brick, stone, and related construction material merchant 

wholesalers

4.4 89.1% 39.9% 153

423330Roofing, siding, and insulation material merchant wholesalers 7.5 93.8% 38.3% 99

423390 Other construction material merchant wholesalers 4.2 89.5% 37.1% 145

423410 Photographic equipment and supplies merchant wholesalers 2.5 78.3% 45.4% 54

423420 Office equipment merchant wholesalers 10.1 89.5% 67.6% 261

423430Computer and software merchant wholesalers 4.7 80.4% 64.2% 526

423440 Other commercial equipment merchant wholesalers 2.3 88.3% 25.2% 91

U.S. Economic Census 

(2010e)

219

U.S. Multi-Unit Firms U.S. Multi-Unit 

Establishments

U.S. Economic Census 

(2010d, e)

3,100 – 2,530 = 570

(U.S. Multi-Unit Establishments) / 

(U.S. Multi-Unit Firms)

570 / 219 = 2.6

Number of Establishments per MultiUnit Firm

U.S. Economic Census 

(2010d)

3,100

All U.S. Establishments

Probability Firm has an Establishment in CA

1 – (Probability an Establishment is not in CA)^ 

(Number of Establishments per Multi-Unit Firm)

1 – (89.5%)^(2.6) = 25%

(US Multi-Unit Firms) * (Probability 

of an Establishment in CA)

219 * 25% = 55

CA Multi-Unit Firms

U.S. Economic Census 

(2010d)

325

All CA Establishments

Probability an Establishment is NOT in CA

1 - (All CA Establishments) / (All U.S. 

Establishments)

1 – 325 / 3,100 = 89.5%
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-136 

Table 2-76: Number of Multi-Unit Wholesaler Firms with a California Establishment, by 

Affected NAICS

NAICS NAICS Description

U.S. 

Number of 

Estab. per 

Multi-Unit 

Firm

Probability 

an Estab. is 

not in CA

Probability 

Firm has 

an Estab. 

in CA

Number 

of CA 

MultiUnit 

Firms

423450 Medical equipment merchant wholesalers 3.9 86.1% 44.4% 213

423490

Other professional equipment and supplies merchant 

wholesalers

2.4 87.0% 28.7% 68

423510 Metal service centers and other metal merchant wholesalers 3.6 88.2% 36.1% 399

423610Elec. equip. and wiring merchant wholesalers 6.0 86.3% 58.6% 626

423620Electric appliance merchant wholesalers 2.8 78.2% 49.8% 158

423690 Other electronic parts and equipment merchant wholesalers 4.0 78.5% 62.5% 721

423710 Hardware merchant wholesalers 4.2 84.5% 50.7% 290

423720 Plumbing equip. merchant wholesalers 7.0 88.5% 57.5% 329

423730 HVAC equip. merchant wholesalers 7.0 92.8% 40.5% 207

423740Refrigeration equipment and supplies merchant wholesalers 5.2 85.1% 56.8% 76

423810Construction equipment merchant wholesalers 3.8 92.5% 26.0% 167

423820

Farm and garden machinery and equipment merchant 

wholesalers

3.3 92.6% 22.2% 204

423830 Industrial machinery and equipment merchant wholesalers 3.4 90.1% 30.2% 869

423840 Industrial supplies merchant wholesalers 4.2 88.5% 40.1% 382

423850

Service establishment equipment and supplies merchant 

wholesalers

3.6 92.1% 25.4% 104

423910

Sporting and recreational goods and supplies merchant 

wholesalers

2.7 80.5% 44.4% 160

423920Toy and hobby goods and supplies merchant wholesalers 1.8 70.4% 46.4% 63

423930Recyclable material merchant wholesalers 3.2 88.5% 32.6% 170

423940 Jewelry merchant wholesalers 2.3 80.8% 38.2% 71

423990 Other miscellaneous durable goods merchant wholesalers 2.4 83.2% 35.5% 207

424110 Printing and writing paper merchant wholesalers 5.8 87.5% 53.6% 55

424120 Stationery and office supplies merchant wholesalers 4.1 87.5% 42.1% 170

424130 Industrial and personal service paper merchant wholesalers 3.1 85.3% 39.2% 162

424210 Drugs and druggists' sundries merchant wholesalers 5.0 82.4% 62.2% 352

424310

Piece goods, notions, and other dry goods merchant 

wholesalers

2.6 72.6% 56.0% 137

424320 Men's and boys' clothing and furnishings merchant wholesalers 2.1 76.9% 42.6% 125

424330Women's and children's clothing merchant wholesalers 2.1 69.3% 53.0% 219

424340 Footwear merchant wholesalers 1.9 68.4% 51.8% 58

424410 General line grocery merchant wholesalers 2.9 82.4% 42.5% 78

424420 Packaged frozen food merchant wholesalers 2.7 82.7% 40.6% 118

424450Confectionery merchant wholesalers 3.7 87.1% 39.6% 59

424460 Fish and seafood merchant wholesalers 1.8 88.2% 20.5% 24

424480 Fresh fruit and vegetable merchant wholesalers 2.3 78.3% 43.4% 140

424490 Other grocery and related products merchant wholesalers 5.7 84.6% 61.4% 445

424510 Grain and field bean merchant wholesalers 4.6 97.3% 11.9% 80

424610

Plastics materials and basic forms and shapes merchant 

wholesaler

2.9 84.9% 37.5% 137

424690 Other chemical and allied products merchant wholesalers 5.3 90.5% 41.0% 347

424910 Farm supplies merchant wholesalers 5.2 91.6% 36.7% 278

424920Book, periodical, and newspaper merchant wholesalers 4.3 87.2% 44.3% 103

424930

Flower, nursery stock, & florists' supplies merchant 

wholesalers

2.9 84.1% 39.0% 123
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-137 

Table 2-76: Number of Multi-Unit Wholesaler Firms with a California Establishment, by 

Affected NAICS

NAICS NAICS Description

U.S. 

Number of 

Estab. per 

Multi-Unit 

Firm

Probability 

an Estab. is 

not in CA

Probability 

Firm has 

an Estab. 

in CA

Number 

of CA 

MultiUnit 

Firms

424940Tobacco and tobacco product merchant wholesalers 3.0 93.1% 19.2% 23

424950 Paint, varnish, and supplies merchant wholesalers 4.7 88.6% 43.1% 105

424990 Other miscellaneous nondurable goods merchant wholesalers 1.9 76.4% 40.1% 228

Total Wholesalers in Affected NAICS 10,656

Sources: U.S. Census Bureau 2010a, b

2775 

Table 2-77: Number of Multi-Unit Retailer Firms with a California Establishment, by Affected 

NAICS

NAICS NAICS Description

U.S. 

Number of 

Estab. per 

Multi-Unit 

Firm

Probability 

an Estab. is 

not in CA

Probability 

Firm has 

an Estab. 

in CA

Number of

CA MultiUnit 

Firms

441110 New car dealers 2.7 89.9% 25.0% 499

441210Recreational vehicle dealers 2.6 89.5% 25.0% 55

441221 Motorcycle, ATV, and personal watercraft dealers 2.4 89.9% 22.4% 61

441229 All other motor vehicle dealers 2.0 89.9% 19.2% 21

441320Tire dealers 10.7 89.9% 68.2% 614

442110 Furniture stores 5.8 88.5% 50.9% 960

442210 Floor covering stores 3.0 89.9% 27.5% 214

442291Window treatment stores 5.6 86.5% 55.4% 45

442299 All other home furnishings stores 14.4 88.1% 83.8% 474

443111 Household appliance stores 3.6 91.0% 28.9% 170

443112Radio, television, and other electronics stores 16.3 88.0% 87.5% 821

443120Computer and software stores 30.6 87.5% 98.3% 162

443130Camera and photographic supplies stores 14.5 89.9% 78.6% 70

444110 Home centers 13.8 91.6% 70.4% 235

444120 Paint and wallpaper stores 18.4 90.7% 83.5% 262

444130 Hardware stores 6.0 92.5% 37.5% 323

444190 Other building material dealers 3.8 90.1% 32.7% 1,059

444210 Outdoor power equipment stores 1.9 94.6% 10.1% 23

444220 Nursery, garden center, and farm supply stores 3.7 92.8% 23.8% 277

445110 Supermarkets and other grocery (except convenience) stores 12.5 87.9% 79.8% 1,602

445120Convenience stores 6.2 89.9% 48.5% 310

445210 Meat markets 4.1 89.9% 35.5% 58

445220 Fish and seafood markets 1.6 89.9% 15.7% 11

445230 Fruit and vegetable markets 2.2 89.9% 21.1% 15

445291Baked goods stores 10.3 89.9% 66.7% 83

445292Confectionery and nut stores 8.9 89.9% 61.2% 97

445299 All other specialty food stores 7.2 89.9% 53.6% 108

445310Beer, wine, and liquor stores 4.6 89.9% 38.7% 437

446110 Pharmacies and drug stores 17.9 89.9% 85.2% 1,156

446120Cosmetics, beauty supplies, and perfume stores 37.9 89.9% 98.2% 179

446130 Optical goods stores 19.4 89.9% 87.4% 368

446191 Food (health) supplement stores 20.9 89.9% 89.2% 174

446199 All other health and personal care stores 4.9 89.9% 40.9% 318

447110 Gasoline stations with convenience stores 11.1 89.9% 69.4% 3,029
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-138 

Table 2-77: Number of Multi-Unit Retailer Firms with a California Establishment, by Affected 

NAICS

NAICS NAICS Description

U.S. 

Number of 

Estab. per 

Multi-Unit 

Firm

Probability 

an Estab. is 

not in CA

Probability 

Firm has 

an Estab. 

in CA

Number of

CA MultiUnit 

Firms

447190 Other gasoline stations 3.8 89.9% 33.6% 660

448110 Men's clothing stores 9.0 87.0% 71.6% 300

448120Women's clothing stores 31.2 87.8% 98.3% 737

448130Children's and infants' clothing stores 39.7 88.0% 99.4% 112

448140 Family clothing stores 30.3 87.5% 98.3% 669

448150Clothing accessories stores 30.8 87.8% 98.2% 128

448190 Other clothing stores 8.8 88.4% 66.2% 346

448210 Shoe stores 30.5 89.9% 96.1% 692

448310 Jewelry stores 14.4 88.2% 83.5% 565

448320Luggage and leather goods stores 8.7 89.9% 60.4% 46

451110 Sporting goods stores 5.4 88.7% 47.5% 509

451120 Hobby, toy, and game stores 14.9 89.0% 82.4% 213

451130 Sewing, needlework, and piece goods stores 13.5 88.8% 79.8% 98

451140 Musical instrument and supplies stores 4.3 89.9% 36.5% 104

451211Book stores 16.1 89.9% 82.0% 289

451212 News dealers and newsstands 4.2 89.9% 36.3% 24

451220 Prerecorded tape, compact disc, and record stores 11.8 89.9% 71.7% 120

452111 Department stores (except discount department stores) 251.9 87.6% 100.0% 14

452112 Discount department stores 499.7 88.6% 100.0% 10

452910Warehouse clubs and supercenters 387.2 95.7% 100.0% 11

452990 All other general merchandise stores 63.2 94.3% 97.6% 380

453110 Florists 2.4 91.2% 19.7% 113

453210 Office supplies and stationery stores 12.5 87.2% 81.8% 302

453220 Gift, novelty, and souvenir stores 6.0 89.5% 48.7% 707

453910 Pet and pet supplies stores 11.6 89.9% 70.9% 192

453920 Art dealers 2.2 86.8% 27.2% 60

453930 Manufactured (mobile) home dealers 4.9 94.6% 23.8% 68

453991Tobacco stores 4.7 89.9% 39.6% 170

453998 All other miscellaneous store retailers (except tobacco stores) 4.1 89.9% 35.7% 287

454111Electronic shopping 1.4 89.9% 14.2% 96

454113 Mail-order houses 2.7 89.9% 24.7% 127

454210 Vending machine operators 4.3 89.9% 36.8% 60

454311 Heating oil dealers 2.7 89.9% 24.9% 91

454312Liquefied petroleum gas (bottled gas) dealers 9.1 89.9% 62.3% 281

454390 Other direct selling establishments 3.1 89.7% 28.5% 235

Total Retailers in Affected NAICS 23,107

Sources: U.S. Census Bureau 1997, 2010d, g, h

2776 

2777 Baseline CARB compliance is estimated as the sum of single-unit firms in California and multi2778 unit firms with at least one establishment in California (See Figure 2-7). 

2779 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-139 

Figure 2-7: Example Methodology for Estimating Baseline CARB Compliance (NAICS 441210)

2780 

2781 Estimated baseline compliance with the CARB ATCM is presented in Table 2-76 for wholesaler 

2782 industries and Table 2-77 for retailer industries. As described above, firms that are already meeting the 

2783 requirements of the CARB ATCM are not expected to incur additional costs associated with setting up 

2784 chain of custody systems to comply with the TSCA Title VI proposed rule. Estimated baseline CARB 

2785 compliance of these industries varies widely by NAICS, from 5 percent to 92 percent of total U.S. firms. 

2786 

Table 2-76: Baseline Compliance of Wholesaler Firms, by Affected NAICS

NAIC

S NAICS Description 

CA 

Singl

eUnit 

Firm

s

CA 

MultiUnit 

Firms

All 

CA 

Firm

s

All 

U.S. 

Fir

ms

Baseline 

ComplianceCo

mpliancea

423210

a

42321

0b Furniture merchant wholesalers 

- - - 6,17

2

100% 

423220

a

42322

0b Home furnishing merchant wholesalers 

- - - 6,49

1

100% 

423310 Lumber, plywood, millwork, and wood panel merchant wholesalers

520 277 797 6,47

5

12.3% 

423320 Brick, stone, and related construction material merchant wholesalers

263 153 416 2,79

6

14.9% 

423330 Roofing, siding, and insulation material merchant wholesalers 54 99 153 1,12 13.7% 

Formatted Table

Deleted Cells

Deleted Cells

Deleted Cells

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

May 1, 2013 2-140 

Table 2-76: Baseline Compliance of Wholesaler Firms, by Affected NAICS

NAIC

S NAICS Description 

CA 

Singl

eUnit 

Firm

s

CA 

MultiUnit 

Firms

All 

CA 

Firm

s

All 

U.S. 

Fir

ms

Baseline 

ComplianceCo

mpliancea

1

423390 Other construction material merchant wholesalers 

222 145 367 2,51

4

14.6% 

423410 Photographic equipment and supplies merchant wholesalers 166 54 220 886 24.8% 

423420 Office equipment merchant wholesalers 

264 261 525 2,89

5

18.1% 

423430 Computer and software merchant wholesalers 

1,508 526 2,035 8,50

9

23.9% 

423440 Other commercial equipment merchant wholesalers 

422 91 513 3,96

2

13.0% 

423450 Medical equipment merchant wholesalers 

933 213 1,145 7,19

7

15.9% 

423490 Other professional equipment and supplies merchant wholesalers 

234 68 302 2,04

1

14.8% 

423510 Metal service centers and other metal merchant wholesalers 

807 399 1,207 7,97

3

15.1% 

423610 Elec. equip. and wiring merchant wholesalers 

1,034 626 1,660 8,62

2

19.3% 

423620 Electric appliance merchant wholesalers 

492 158 649 2,57

6

25.2% 

423690 Other electronic parts and equipment merchant wholesalers 

2,010 721 2,731 10,4

83

26.1% 

423710 Hardware merchant wholesalers 

710 290 1,000 5,15

4

19.4% 

423720 Plumbing equip. merchant wholesalers 

346 329 674 3,58

4

18.8% 

423730 HVAC equip. merchant wholesalers 

131 207 338 2,33

6

14.5% 

423740 Refrigeration equipment and supplies merchant wholesalers 93 76 168 758 22.2% 

423810 Construction equipment merchant wholesalers 

183 167 350 3,07

5

11.4% 

423820 Farm and garden machinery and equipment merchant wholesalers 

399 204 603 6,31

6

9.5% 

423830 Industrial machinery and equipment merchant wholesalers 

2,129 869 2,998 24,3

57

12.3% 

423840 Industrial supplies merchant wholesalers 

558 382 940 5,80

8

16.2% 

423850 Service establishment equipment and supplies merchant wholesalers

258 104 362 3,66

9

9.9% 

423910 Sporting and recreational goods and supplies merchant wholesalers 

1,033 160 1,194 5,66

1

21.1% 

423920 Toy and hobby goods and supplies merchant wholesalers 

669 63 733 2,39

8

30.5% 

423930 Recyclable material merchant wholesalers 

656 170 826 6,21

8

13.3% 

423940 Jewelry merchant wholesalers 

1,414 71 1,485 7,57

0

19.6% 

423990 Other miscellaneous durable goods merchant wholesalers 1,489 207 1,696 9,46 17.9% 

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

May 1, 2013 2-141 

Table 2-76: Baseline Compliance of Wholesaler Firms, by Affected NAICS

NAIC

S NAICS Description 

CA 

Singl

eUnit 

Firm

s

CA 

MultiUnit 

Firms

All 

CA 

Firm

s

All 

U.S. 

Fir

ms

Baseline 

ComplianceCo

mpliancea

0

424110 Printing and writing paper merchant wholesalers 87 55 142 801 17.8% 

424120 Stationery and office supplies merchant wholesalers 

527 170 697 4,62

0

15.1% 

424130 Industrial and personal service paper merchant wholesalers 

536 162 699 4,05

8

17.2% 

424210 Drugs and druggists' sundries merchant wholesalers 

1,004 352 1,356 6,26

1

21.7% 

424310 Piece goods, notions, and other dry goods merchant wholesalers 

796 137 932 3,15

0

29.6% 

424320 Men's and boys' clothing and furnishings merchant wholesalers 

841 125 966 3,92

7

24.6% 

424330 Women's and children's clothing merchant wholesalers 

2,096 219 2,315 7,23

7

32.0% 

424340 Footwear merchant wholesalers 

458 58 515 1,55

7

33.1% 

424410 General line grocery merchant wholesalers 

357 78 435 2,20

8

19.7% 

424420 Packaged frozen food merchant wholesalers 

468 118 586 2,99

4

19.6% 

424450 Confectionery merchant wholesalers 

212 59 271 1,79

8

15.1% 

424460 Fish and seafood merchant wholesalers 

213 24 237 1,92

4

12.3% 

424480 Fresh fruit and vegetable merchant wholesalers 

939 140 1,079 4,64

6

23.2% 

424490 Other grocery and related products merchant wholesalers 

1,376 445 1,821 9,66

8

18.8% 

424510 Grain and field bean merchant wholesalers 

49 80 129 2,46

9

5.2% 

424610 Plastics materials and basic forms and shapes merchant wholesaler 

357 137 495 2,73

4

18.1% 

424690 Other chemical and allied products merchant wholesalers 

541 347 887 6,52

7

13.6% 

424910 Farm supplies merchant wholesalers 

318 278 595 4,54

3

13.1% 

424920 Book, periodical, and newspaper merchant wholesalers 

232 103 336 2,04

9

16.4% 

424930 Flower, nursery stock, & florists' supplies merchant wholesalers 

528 123 651 3,63

5

17.9% 

424940 Tobacco and tobacco product merchant wholesalers 

70 23 92 1,13

5

8.1% 

424950 Paint, varnish, and supplies merchant wholesalers 

105 105 211 1,16

8

18.0% 

424990 Other miscellaneous nondurable goods merchant wholesalers 

2,724 228 2,952 12,1

18

24.4% 

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

May 1, 2013 2-142 

Table 2-76: Baseline Compliance of Wholesaler Firms, by Affected NAICS

NAIC

S NAICS Description 

CA 

Singl

eUnit 

Firm

s

CA 

MultiUnit 

Firms

All 

CA 

Firm

s

All 

U.S. 

Fir

ms

Baseline 

ComplianceCo

mpliancea

Total Wholesalers in Affected NAICS

33,831 10,656 44,488 258,3

04

17.2%

a See Figure 2-5, Figure 2-6, and Figure 2-7a

 for a description of how baseline compliance was estimated. b Two wholesale industries, Furniture Merchant Wholesalers (423210) and Home Furnishing Merchant Wholesalers (423220) are 

assumed to be fully compliant with the CARB ATCM chain of custody requirements in the baseline, based on conversation with 

industry (Personal Communication with AHFA 2010, Personal Communication with BIFMA 2010). 

Sources: U.S. Census Bureau 2010d, o 

2787 

Table 2-77: Baseline Compliance of Retailer Firms, by Affected NAICS

NAICS NAICS Description 

CA 

Singl

eUnit 

Firm

s

CA 

MultiUnit 

Firms

All 

CA 

Firm

s

All 

U.S. 

Fir

ms

Baseline 

ComplianceCo

mpliancea

441110 New car dealers 

1,970 499 2,470 21,4

89

11.5% 

441210 Recreational vehicle dealers 

265 55 320 2,74

9

11.6% 

441221 Motorcycle, ATV, and personal watercraft dealers 

555 61 616 5,76

3

10.7% 

441229 All other motor vehicle dealers 

206 21 228 2,15

4

10.6% 

441320 Tire dealers 

1,056 614 1,670 11,3

46

14.7% 

442110 Furniture stores 

2,045 960 3,005 19,7

14

15.2% 

442210 Floor covering stores 

1,233 214 1,448 12,9

65

11.2% 

442291 Window treatment stores 

296 45 342 2,27

8

15.0% 

442299 All other home furnishings stores 

1,307 474 1,781 11,5

60

15.4% 

443111 Household appliance stores 

652 170 822 7,80

5

10.5% 

443112 Radio, television, and other electronics stores 

1,645 821 2,466 14,6

79

16.8% 

443120 Computer and software stores 

675 162 837 5,55

0

15.1% 

443130 Camera and photographic supplies stores 71 70 141 788 17.8% 

444110 Home centers 

196 235 431 2,66

4

16.2% 

444120 Paint and wallpaper stores 

195 262 457 2,39

9

19.0% 

444130 Hardware stores 

851 323 1,175 12,1

52

9.7% 

444190 Other building material dealers 

2,691 1,059 3,750 30,4

67

12.3% 

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

May 1, 2013 2-143 

Table 2-77: Baseline Compliance of Retailer Firms, by Affected NAICS

NAICS NAICS Description 

CA 

Singl

eUnit 

Firm

s

CA 

MultiUnit 

Firms

All 

CA 

Firm

s

All 

U.S. 

Fir

ms

Baseline 

ComplianceCo

mpliancea

444210 Outdoor power equipment stores 

212 23 235 4,14

6

5.7% 

444220 Nursery, garden center, and farm supply stores 

833 277 1,110 12,8

04

8.7% 

445110 Supermarkets and other grocery (except convenience) stores 

4,809 1,602 6,411 41,8

85

15.3% 

445120 Convenience stores 

2,176 310 2,486 22,1

68

11.2% 

445210 Meat markets 

540 58 597 5,50

2

10.9% 

445220 Fish and seafood markets 

198 11 208 2,02

2

10.3% 

445230 Fruit and vegetable markets 

281 15 296 2,85

1

10.4% 

445291 Baked goods stores 

303 83 387 3,12

6

12.4% 

445292 Confectionery and nut stores 

201 97 299 2,14

9

13.9% 

445299 All other specialty food stores 

410 108 518 4,25

8

12.2% 

445310 Beer, wine, and liquor stores 

2,657 437 3,095 27,4

21

11.3% 

446110 Pharmacies and drug stores 

1,790 1,156 2,946 19,0

67

15.5% 

446120 Cosmetics, beauty supplies, and perfume stores 

675 179 854 6,86

1

12.4% 

446130 Optical goods stores 

503 368 871 5,39

8

16.1% 

446191 Food (health) supplement stores 

498 174 672 5,12

3

13.1% 

446199 All other health and personal care stores 

691 318 1,009 7,61

2

13.3% 

447110 Gasoline stations with convenience stores 

4,954 3,029 7,983 53,3

75

15.0% 

447190 Other gasoline stations 

1,385 660 2,045 15,6

66

13.1% 

448110 Men's clothing stores 

589 300 890 4,95

2

18.0% 

448120 Women's clothing stores 

1,566 737 2,303 13,5

82

17.0% 

448130 Children's and infants' clothing stores 

314 112 426 2,72

4

15.6% 

448140 Family clothing stores 

954 669 1,624 8,29

9

19.6% 

448150 Clothing accessories stores 

427 128 554 3,61

8

15.3% 

448190 Other clothing stores 

861 346 1,206 7,95

2

15.2% 

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

May 1, 2013 2-144 

Table 2-77: Baseline Compliance of Retailer Firms, by Affected NAICS

NAICS NAICS Description 

CA 

Singl

eUnit 

Firm

s

CA 

MultiUnit 

Firms

All 

CA 

Firm

s

All 

U.S. 

Fir

ms

Baseline 

ComplianceCo

mpliancea

448210 Shoe stores 

621 692 1,313 6,86

7

19.1% 

448310 Jewelry stores 

2,123 565 2,688 18,6

92

14.4% 

448320 Luggage and leather goods stores 57 46 103 637 16.1% 

451110 Sporting goods stores 

1,859 509 2,368 17,5

56

13.5% 

451120 Hobby, toy, and game stores 

603 213 816 5,74

8

14.2% 

451130 Sewing, needlework, and piece goods stores 

447 98 545 4,12

4

13.2% 

451140 Musical instrument and supplies stores 

334 104 437 3,58

5

12.2% 

451211 Book stores 

434 289 722 4,64

3

15.6% 

451212 News dealers and newsstands 

125 24 150 1,30

6

11.5% 

451220 Prerecorded tape, compact disc, and record stores 

220 120 340 2,34

3

14.5% 

452111 Department stores (except discount department stores) 1 14 15 21 70.8% 

452112 Discount department stores 0 10 10 14 74.7% 

452910 Warehouse clubs and supercenters 0 11 11 12 92.0% 

452990 All other general merchandise stores 

486 380 866 8,86

2

9.8% 

453110 Florists 

1,634 113 1,747 19,0

38

9.2% 

453210 Office supplies and stationery stores 

632 302 934 5,31

7

17.6% 

453220 Gift, novelty, and souvenir stores 

2,378 707 3,085 24,1

06

12.8% 

453910 Pet and pet supplies stores 

570 192 762 5,91

4

12.9% 

453920 Art dealers 

815 60 875 6,40

3

13.7% 

453930 Manufactured (mobile) home dealers 

135 68 203 2,77

4

7.3% 

453991 Tobacco stores 

456 170 626 4,94

0

12.7% 

453998 All other miscellaneous store retailers (except tobacco stores) 

1,409 287 1,696 14,7

43

11.5% 

454111 Electronic shopping 

1,335 96 1,432 13,8

88

10.3% 

454113 Mail-order houses 

602 127 729 6,47

1

11.3% 

454210 Vending machine operators 

454 60 514 4,65

1

11.0% 

454311 Heating oil dealers 

311 91 402 3,44

2

11.7% 

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

May 1, 2013 2-145 

Table 2-77: Baseline Compliance of Retailer Firms, by Affected NAICS

NAICS NAICS Description 

CA 

Singl

eUnit 

Firm

s

CA 

MultiUnit 

Firms

All 

CA 

Firm

s

All 

U.S. 

Fir

ms

Baseline 

ComplianceCo

mpliancea

454312 Liquefied petroleum gas (bottled gas) dealers 

186 281 468 2,29

7

20.4% 

454390 Other direct selling establishments 

2,020 235 2,255 20,3

70

11.1% 

Total Retailers in Affected NAICS

63,985 23,107 87,092 657,8

47

13.2%

a See Figure 2-5, Figure 2-6, and Figure 2-7 for a description of how baseline compliance was estimated.

Sources: U.S. Census Bureau 1997, 2010b, e, p 

2788 

2789 

2790 2.5.3.3 Number of Firms Incurring Rule Familiarization, Supplier Notification, Recordkeeping, and 

2791 Labeling Costs 

2792 

2793 All affected entities, regardless of baseline CARB compliance, are expected to incur rule 

2794 familiarization costs and costs associated with supplier notification and response letters. The number of 

2795 firms with incremental costs associated with implementing compliant recordkeeping and labeling systems 

2796 is estimated as the total number of firms in each affected industry in the U.S. that are not already 

2797 compliant with the CARB regulation. Information on the percentages of fabricator and wholesaler firms 

2798 incurring additional costs such as initial recordkeeping costs, recurring recordkeeping costs, or initial 

2799 labeling costs, is taken from summary statistics from the questionnaire results (See Table 2-69 and Table 

2800 2-70). 

2801 

2802 Table 2-78 presents the number of affected manufacturing firms by type. Table 2-79, Table 2-80, 

2803 and Table 2-81 show the estimated levels of baseline compliance with the CARB rule for all fabricator, 

2804 wood veneer laminated product producer, wholesaler, and retailer firms that use or sell composite wood 

2805 products by NAICS code. The estimated numbers of firms that will incur incremental costs, by type of 

2806 cost incurred, are also presented. Table 2-82 summarizes the number of firms selling composite wood 

2807 products regulated under the TSCA Title VI Rule and the number of firms that are baseline compliant 

2808 with the CARB ATCM (i.e., firms selling composite wood products that may ultimately be sold in 

2809 California).

2810 

Table 2-78: Number of Composite Wood Product Producers Incurring Costs

Sector Number of Affected Firms in 

Industrya

Hardwood Plywood 32 

Medium Density Fiberboard (MDF) 14 

Particleboard 16 

Total 62 a See Table 2-4

Note that because firms producing two different types of composite wood products are expected to incur separate 

costs for each product type, the estimate of 62 firms that is used to estimate costs is derived by counting firms that 

produce two different types of composite wood products twice. There are 54 unique firms that produce composite 

wood panels.

2811 

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

May 1, 2013 2-146 

2812 

Table 2-79: Baseline Compliance and Number of Fabricator and Laminated Product Producer Firms Incurring Costs 

NAICS NAICS Description 

Number of 

Firms in 

Affected 

NAICS

Number of 

Affected 

Firmsa

Baseline 

CARB 

Complianceb

Number of 

Affected Firms 

without Baseline 

CARB Compliance

Number of Firms with 

Recurring 

Recordkeeping Costs

(the 11% of firms 

without baseline 

compliance)c

Number of Firms 

with More 

Substantial Initial 

Labeling Costs (the 

33% of firms 

without baseline 

compliance)c

Number of Firms 

with Minor Initial 

Labeling Costs (the 

67% of firms 

without baseline 

compliance and all 

firms with baseline 

compliance)c

321211 Decorative Panel 321219 Manufacturers 71 71 100% 0 0 0 71 337110 Cabinet Manufacturers 17,360 17,360 50% 8,680 955 2,864 14,496 337129 476 476 50% 238 26 79 397 321911 Window and Door 

Manufacturers 

3,582 3,582 100% 0 0 0 3,582 

337121 2,790 2,790 100% 0 0 0 2,790 337122 Household Furniture 

Manufacturers 

6,061 6,061 100% 0 0 0 6,061 

337124 579 579 100% 0 0 0 579 337127 

Institutional and Office Furniture Manufacturing 

1,367 1,367 100% 0 0 0 1,367 

337211 804 804 100% 0 0 0 804 337214 486 486 100% 0 0 0 486 337215 2,415 2,415 100% 0 0 0 2,415 321918 Custom architectural 

woodwork & millwork manufacturing and other millwork manufacturing (including flooring) 

5,214 5,214 9% 4,745 522 1,566 3,648 

337212 3,991 3,991 10% 3,592 395 1,185 2,806 321999 

4,822 4,822

8%

4,436 488 1,464 3,358 

336213 Motor home, travel trailer, 

and camper manufacturing 

112 112 100% 0 0 0 112 

336214 1,203 1,203 100% 0 0 0 1,203 321991 Manufactured Home and 

Prefabricated Building Manufacturing 

798 798 11% 710 78 234 564 

321992 

1,930 1,930

6%

1,814 200 599 1,331 

339950 Sign Manufacturing 25,917 25,917 10% 23,325 2,566 7,697 18,220 Total Affected Fabricators 79,978 79,978 47,540 5,230 15,688 64,290 a Affected firms are those that sell composite wood products. See Table 2-8. b See Table 2-75. c See Table 2-69. None of the fabricators responding to the questionnaire reported incurring initial recordkeeping costs or recurring labeling costs.

2813 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-147 

Table 2-80: Baseline Compliance and Number of Wholesaler Firms Incurring Different Types of Costs 

NAICS NAICS Description 

Number 

of Firms 

in 

Affected 

NAICS

Number of 

Affected 

Firmsa

Baseline 

CARB 

Complianceb

Number of 

Affected 

Firms 

without 

Baseline 

CARB 

Compliance

Number of 

Firms with 

Initial 

Labeling 

Costs (1% 

of all firms) 

Number of Firms with Incremental Recordkeeping Costsc

Options with 

Recordkeeping 

Requirements Consistent 

with the CARB ATCM

(SE, SI, SP, SN, SC, SFCC, 

CE, CI, NE, NI) 

Options with Reduced 

Recordkeeping Requirements 

(SCR, SEUR, SCUR)

Initial Costs

(57% of 

firms 

without 

baseline 

compliance)

Recurring 

Costs

(43% of 

firms 

without 

baseline 

compliance)

Initial Costs 

(57% of the 

28% of firms 

without 

baseline 

compliance that 

are importers)

Recurring 

Costs 

(43% of the 

28% of firms 

without 

baseline 

compliance

that are 

importers) 

423210d Furniture merchant wholesalers 12,480 12,480 100% 0 125 0 0 0 0 423220d 

Home furnishing merchant wholesalers 13,759 6,496 100% 0 65 0 0 0 0 

423310 Lumber, plywood, millwork, and 

wood panel merchant wholesalers 10,130 10,130 12% 8,883 101 5,063 3,820 1,418 1,070 

423320 Brick, stone, and related 

construction material merchant wholesalers 

3,931 401 15% 341 4 194 147 54 41 

423330 Roofing, siding, and insulation 

material merchant wholesalers 2,279 1,779 14% 1,536 18 876 660 245 185 

423390 Other construction material 

merchant wholesalers 3,886 3,300 15% 2,818 33 1,606 1,212 450 339 

423410 Photographic equipment and 

supplies merchant wholesalers 1,178 46 25% 35 0 20 15 6 4 

423420 Office equipment merchant 

wholesalers 3,738 101 18% 83 1 47 36 13 10 

423430 Computer and software merchant 

wholesalers 11,293 200 24% 152 2 87 65 24 18 

423440 Other commercial equipment 

merchant wholesalers 5,279 1,057 13% 920 11 524 396 147 111 

423450 Medical equipment merchant 

wholesalers 9,593 78 16% 66 1 38 28 11 8 

423490 Other professional equipment and 

supplies merchant wholesalers 2,709 99 15% 84 1 48 36 13 10 

423510 Metal service centers and other 

metal merchant wholesalers 10,573 1,292 15% 1,096 13 625 471 175 132 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-148 

Table 2-80: Baseline Compliance and Number of Wholesaler Firms Incurring Different Types of Costs 

NAICS NAICS Description 

Number 

of Firms 

in 

Affected 

NAICS

Number of 

Affected 

Firmsa

Baseline 

CARB 

Complianceb

Number of 

Affected 

Firms 

without 

Baseline 

CARB 

Compliance

Number of 

Firms with 

Initial 

Labeling 

Costs (1% 

of all firms) 

Number of Firms with Incremental Recordkeeping Costsc

Options with 

Recordkeeping 

Requirements Consistent 

with the CARB ATCM

(SE, SI, SP, SN, SC, SFCC, 

CE, CI, NE, NI) 

Options with Reduced 

Recordkeeping Requirements 

(SCR, SEUR, SCUR)

Initial Costs

(57% of 

firms 

without 

baseline 

compliance)

Recurring 

Costs

(43% of 

firms 

without 

baseline 

compliance)

Initial Costs 

(57% of the 

28% of firms 

without 

baseline 

compliance that 

are importers)

Recurring 

Costs 

(43% of the 

28% of firms 

without 

baseline 

compliance

that are 

importers) 

423610 Elec. equip. and wiring merchant 

wholesalers 13,035 101 19% 82 1 47 35 13 10 

423620 Electric appliance merchant 

wholesalers 3,675 88 25% 66 1 38 28 11 8 

423690 Other electronic parts and 

equipment merchant wholesalers 14,717 121 26% 89 1 51 38 14 11 

423710 Hardware merchant wholesalers 6,722 938 19% 756 9 431 325 121 91 423720 Plumbing equip. merchant 

wholesalers 5,252 1,392 19% 1,130 14 644 486 180 136 

423730 HVAC equip. merchant wholesalers 3,455 571 14% 488 6 278 210 78 59 423740 Refrigeration equipment and 

supplies merchant wholesalers 1,040 91 22% 71 1 40 31 11 9 

423810 Construction equipment merchant 

wholesalers 4,473 21 11% 19 0 11 8 3 2 

423820 Farm and garden machinery and 

equipment merchant wholesalers 8,964 461 10% 417 5 238 179 67 50 

423830 Industrial machinery and equipment 

merchant wholesalers 32,888 525 12% 460 5 262 198 73 55 

423840 Industrial supplies merchant 

wholesalers 8,213 293 16% 246 3 140 106 39 30 

423850 Service establishment equipment 

and supplies merchant wholesalers 5,050 715 10% 644 7 367 277 103 78 

423910 Sporting and recreational goods and 

supplies merchant wholesalers 16,709 9,739 21% 7,685 97 4,380 3,305 1,226 925 

423920 Toy and hobby goods and supplies 

merchant wholesalers 9,801 9,801 31% 6,807 98 3,880 2,927 1,086 820 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-149 

Table 2-80: Baseline Compliance and Number of Wholesaler Firms Incurring Different Types of Costs 

NAICS NAICS Description 

Number 

of Firms 

in 

Affected 

NAICS

Number of 

Affected 

Firmsa

Baseline 

CARB 

Complianceb

Number of 

Affected 

Firms 

without 

Baseline 

CARB 

Compliance

Number of 

Firms with 

Initial 

Labeling 

Costs (1% 

of all firms) 

Number of Firms with Incremental Recordkeeping Costsc

Options with 

Recordkeeping 

Requirements Consistent 

with the CARB ATCM

(SE, SI, SP, SN, SC, SFCC, 

CE, CI, NE, NI) 

Options with Reduced 

Recordkeeping Requirements 

(SCR, SEUR, SCUR)

Initial Costs

(57% of 

firms 

without 

baseline 

compliance)

Recurring 

Costs

(43% of 

firms 

without 

baseline 

compliance)

Initial Costs 

(57% of the 

28% of firms 

without 

baseline 

compliance that 

are importers)

Recurring 

Costs 

(43% of the 

28% of firms 

without 

baseline 

compliance

that are 

importers) 

423930 Recyclable material merchant 

wholesalers 14,909 12 13% 10 0 6 4 2 1 

423940 Jewelry merchant wholesalers 30,439 215 20% 173 2 99 74 28 21 423990 Other miscellaneous durable goods 

merchant wholesalers 66,646 13,794 18% 11,320 138 6,452 4,868 1,807 1,363 

424110 Printing and writing paper merchant 

wholesalers 1,423 35 18% 29 0 17 12 5 3 

424120 Stationery and office supplies 

merchant wholesalers 7,607 1,655 15% 1,405 17 801 604 224 169 

424130 Industrial and personal service paper 

merchant wholesalers 6,614 184 17% 152 2 87 65 24 18 

424210 Drugs and druggists' sundries 

merchant wholesalers 8,694 136 22% 107 1 61 46 17 13 

424310 Piece goods, notions, and other dry 

goods merchant wholesalers 7,682 332 30% 234 3 133 101 37 28 

424320 Men's and boys' clothing and 

furnishings merchant wholesalers 9,509 489 25% 369 5 210 159 59 45 

424330 Women's and children's clothing 

merchant wholesalers 17,452 261 32% 178 3 101 77 28 22 

424340 Footwear merchant wholesalers 3,755 119 33% 80 1 46 34 13 10 424410 General line grocery merchant 

wholesalers 4,495 580 20% 466 6 266 200 74 56 

424420 Packaged frozen food merchant 

wholesalers 5,754 78 20% 63 1 36 27 10 8 

424450 Confectionery merchant wholesalers 3,331 14 15% 12 0 7 5 2 1 424460 Fish and seafood merchant 3,721 13 12% 11 0 6 5 2 1 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-150 

Table 2-80: Baseline Compliance and Number of Wholesaler Firms Incurring Different Types of Costs 

NAICS NAICS Description 

Number 

of Firms 

in 

Affected 

NAICS

Number of 

Affected 

Firmsa

Baseline 

CARB 

Complianceb

Number of 

Affected 

Firms 

without 

Baseline 

CARB 

Compliance

Number of 

Firms with 

Initial 

Labeling 

Costs (1% 

of all firms) 

Number of Firms with Incremental Recordkeeping Costsc

Options with 

Recordkeeping 

Requirements Consistent 

with the CARB ATCM

(SE, SI, SP, SN, SC, SFCC, 

CE, CI, NE, NI) 

Options with Reduced 

Recordkeeping Requirements 

(SCR, SEUR, SCUR)

Initial Costs

(57% of 

firms 

without 

baseline 

compliance)

Recurring 

Costs

(43% of 

firms 

without 

baseline 

compliance)

Initial Costs 

(57% of the 

28% of firms 

without 

baseline 

compliance that 

are importers)

Recurring 

Costs 

(43% of the 

28% of firms 

without 

baseline 

compliance

that are 

importers) 

wholesalers 

424480 Fresh fruit and vegetable merchant 

wholesalers 9,203 16 23% 12 0 7 5 2 1 

424490 Other grocery and related products 

merchant wholesalers 17,300 312 19% 253 3 144 109 40 31 

424510 Grain and field bean merchant 

wholesalers 5,795 23 5% 22 0 13 9 4 3 

424610 Plastics materials and basic forms 

and shapes merchant wholesaler 3,607 496 18% 406 5 231 175 65 49 

424690 Other chemical and allied products 

merchant wholesalers 8,143 87 14% 75 1 43 32 12 9 

424910 Farm supplies merchant wholesalers 6,836 68 13% 59 1 34 25 10 7 424920 Book, periodical, and newspaper 

merchant wholesalers 16,045 382 16% 319 4 182 137 51 38 

424930 Flower, nursery stock, & florists' 

supplies merchant wholesalers 11,537 165 18% 135 2 77 58 22 16 

424940 Tobacco and tobacco product 

merchant wholesalers 2,300 11 8% 10 0 6 4 2 1 

424950 Paint, varnish, and supplies 

merchant wholesalers 2,704 128 18% 105 1 60 45 17 13 

424990 Other miscellaneous nondurable 

goods merchant wholesalers 56,245 3,639 24% 2,752 36 1,569 1,183 439 331 

Total Affected Wholesalers 556,568 85,560 53,731 855 30,629 23,102 8,576 6,469 a Affected firms are those that sell composite wood products. See Table 2-16.. b See Table 2-76.. c See Table 2-70. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-151 

Table 2-80: Baseline Compliance and Number of Wholesaler Firms Incurring Different Types of Costs 

NAICS NAICS Description 

Number 

of Firms 

in 

Affected 

NAICS

Number of 

Affected 

Firmsa

Baseline 

CARB 

Complianceb

Number of 

Affected 

Firms 

without 

Baseline 

CARB 

Compliance

Number of 

Firms with 

Initial 

Labeling 

Costs (1% 

of all firms) 

Number of Firms with Incremental Recordkeeping Costsc

Options with 

Recordkeeping 

Requirements Consistent 

with the CARB ATCM

(SE, SI, SP, SN, SC, SFCC, 

CE, CI, NE, NI) 

Options with Reduced 

Recordkeeping Requirements 

(SCR, SEUR, SCUR)

Initial Costs

(57% of 

firms 

without 

baseline 

compliance)

Recurring 

Costs

(43% of 

firms 

without 

baseline 

compliance)

Initial Costs 

(57% of the 

28% of firms 

without 

baseline 

compliance that 

are importers)

Recurring 

Costs 

(43% of the 

28% of firms 

without 

baseline 

compliance

that are 

importers) d Two wholesale industries, Furniture Merchant Wholesalers (423210) and Home Furnishing Merchant Wholesalers (423220) are assumed to be fully compliant with the CARB ATCM 

chain of custody requirements in the baseline, based on conversation with industry (Personal Communication with AHFA 2010, Personal Communication with BIFMA 2010). 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-152 

2814 

Table 2-81: Baseline Compliance and Number of Retail Firms Incurring Costs

NAICS NAICS Description 

Number 

of Firms 

in 

Affected 

NAICS

Number 

of 

Affected 

Firmsa

Baseline 

CARB 

Complianceb

Number of 

Affected 

Firms 

without 

Baseline 

CARB 

Compliance 

441110 New car dealers 68,813 3,973 11% 3,516 

441210 Used carRecreational vehicle dealers 7,043 7,043 12% 6,223 

441221 Recreational vehicleMotorcycle, ATV, and personal 

watercraft dealers 9,934 1,324 11% 

1,183 

441229 Motorcycle, ATV, and personal watercraftAll other 

motor vehicle dealers 24,905 2,715 11% 

2,428 

441320 BoatTire dealers 23,495 37 15% 32 

442110 All other motor vehicle dealersFurniture stores 36,113 36,113 15% 30,608 

442210 Automotive parts and accessoriesFloor covering stores 24,232 21,254 11% 18,881 

442291 Tire dealersWindow treatment stores 4,334 978 15% 831 

442299 FurnitureAll other home furnishings stores 26,385 26,385 15% 22,319 

443111 Floor coveringHousehold appliance stores 13,969 3,381 11% 3,025 

443112 Window treatmentRadio, television, and other 

electronics stores 28,227 13,501 17% 

11,233 

443120 All other home furnishingsComputer and software

stores 14,806 1,052 15% 

893 

443130 Household applianceCamera and photographic supplies

stores 2,532 23 18% 

19 

444110 Radio, television, and other electronics storesHome 

centers 5,076 5,07616% 

4,255 

444120 ComputerPaint and softwarewallpaper stores 4,344 682 19% 552 

444130 Camera and photographic suppliesHardware stores 17,083 17,083 10% 15,432 

444190 Home centersOther building material dealers 48,426 38,160 12% 33,463 

444210 Paint and wallpaperOutdoor power equipment stores 6,532 758 6% 715 

444220 HardwareNursery, garden center, and farm supply

stores 21,508 13,426 9% 

12,262 

445110 Other building material dealersSupermarkets and other 

grocery (except convenience) stores 74,561 21,981 15% 18,617 

445120 Outdoor power equipmentConvenience stores 35,015 10,139 11% 9,002 

445210 Nursery, garden center, and farm supply storesMeat 

markets 8,766 143 11% 

127 

445220 Supermarkets and other grocery (except convenience) 

storesFish and seafood markets 4,544 152 10% 

136 

445230 Convenience storesFruit and vegetable markets 10,823 413 10% 370 

445291 Meat marketsBaked goods stores 13,763 109 12% 96 

445292 FishConfectionery and seafood marketsnut stores 10,589 774 14% 666 

445299 Fruit and vegetable marketsAll other specialty food 

stores 17,905 1,959 12% 

1,721 

445310 Baked goodsBeer, wine, and liquor stores 39,442 1,312 11% 1,164 

446110 ConfectioneryPharmacies and nutdrug stores 24,805 18,543 15% 15,678 

446120 All other specialty foodCosmetics, beauty supplies, and 

perfume stores 88,932 674 12% 

590 

446130 Beer, wine, and liquorOptical goods stores 8,156 6 16% 5 

446191 Pharmacies and drugFood (health) supplement stores 27,185 620 13% 539 

446199 Cosmetics, beauty supplies,All other health and 

perfumepersonal care stores 33,783 54 13% 

47 

447110 Optical goodsGasoline stations with convenience stores 61,137 2,935 15% 2,496 

447190 Food (health) supplement storesOther gasoline stations 17,358 205 13% 178 

Formatted Table

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

May 1, 2013 2-153 

Table 2-81: Baseline Compliance and Number of Retail Firms Incurring Costs

NAICS NAICS Description 

Number 

of Firms 

in 

Affected 

NAICS

Number 

of 

Affected 

Firmsa

Baseline 

CARB 

Complianceb

Number of 

Affected 

Firms 

without 

Baseline 

CARB 

Compliance 

448110 All other health and personal careMen's clothing stores 9,083 598 18% 491 

448120 Gasoline stations with convenienceWomen's clothing

stores 30,198 2,890 17% 

2,400 

448130 Other gasoline stationsChildren's and infants' clothing 

stores 9,814 3,922 16% 

3,309 

448140 Men'sFamily clothing stores 21,840 16,346 20% 13,148 

448150 Women's clothingClothing accessories stores 23,620 873 15% 739 

448190 Children's and infants'Other clothing stores 34,597 2,794 15% 2,370 

448210 Family clothingShoe stores 11,885 1,212 19% 980 

448310 Clothing accessoriesJewelry stores 60,343 5,389 14% 4,614 

448320 Other clothingLuggage and leather goods stores 2,831 424 16% 356 

451110 ShoeSporting goods stores 38,976 28,113 13% 24,321 

451120 JewelryHobby, toy, and game stores 20,373 20,373 14% 17,479 

451130 LuggageSewing, needlework, and leatherpiece goods 

stores 20,034 18,421 13% 

15,988 

451140 Sporting goodsMusical instrument and supplies stores 9,656 30 12% 26 

451211 Hobby, toy, and gameBook stores 14,832 5,425 16% 4,581 

451212 Sewing, needlework, and piece goods storesNews 

dealers and newsstands 13,270 2,553 11% 

2,261 

451220 Musical instrumentPrerecorded tape, compact disc, and 

suppliesrecord stores 6,315 3,571 14% 

3,053 

452111 BookDepartment stores (except discount department 

stores) 2,562 2,56271% 

748 

452112 News dealers and newsstandsDiscount department 

stores 3,611 3,61175% 

915 

452910 Prerecorded tape, compact disc, and record 

storesWarehouse clubs and supercenters 3,076 3,07692% 

245 

452990 DepartmentAll other general merchandise stores

(except discount department stores) 32,639 32,638 10% 

29,449 

453110 Discount department storesFlorists 43,160 33,046 9% 30,014 

453210 Warehouse clubsOffice supplies and 

supercentersstationery stores 11,371 10,745 18% 

8,858 

453220 All other general merchandiseGift, novelty, and 

souvenir stores 77,835 53,166 13% 

46,362 

453910 FloristsPet and pet supplies stores 14,243 106 13% 92 

453920 Office supplies and stationery storesArt dealers 23,850 3,072 14% 2,652 

453930 Gift, novelty, and souvenir storesManufactured 

(mobile) home dealers 4,985 4,9857% 

4,621 

453991 Used merchandiseTobacco stores 35,266 2,373 13% 2,072 

453998 Pet and pet supplies storesAll other miscellaneous store 

retailers (except tobacco stores) 94,838 27,491 12% 24,329 

454111 Art dealersElectronic shopping 67,565 24,102 10% 21,618 

454113 Manufactured (mobile) home dealersMail-order houses 34,185 11,548 11% 10,247 

454210 Tobacco storesVending machine operators 32,246 255 11% 227 

454311 All other miscellaneous store retailers (except tobacco 

stores)Heating oil dealers 4,675 1,445 12% 

1,276 

454312 Electronic shoppingLiquefied petroleum gas (bottled 

gas) dealers 4,116 1,039 20% 

827 

454390 Mail-order housesOther direct selling establishments 717,235 177,871 11% 158,180 

Formatted Table

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

May 1, 2013 2-154 

Table 2-81: Baseline Compliance and Number of Retail Firms Incurring Costs

NAICS NAICS Description 

Number 

of Firms 

in 

Affected 

NAICS

Number 

of 

Affected 

Firmsa

Baseline 

CARB 

Complianceb

Number of 

Affected 

Firms 

without 

Baseline 

CARB 

Compliance 

Total Affected Retailers 2,399,646 759,048 658,150 a Affected firms are those that sell composite wood products. See Table 2-17. b See Table 2-77. 

2815 

Table 2-82: Summary of Number of TSCA Title VI and Baseline CARB ATCM Compliant Firms

Firm Type TSCA Title VI Universea Baseline CARB ATCM 

Compliantb

Not Baseline CARB 

ATCM Compliantb

Stock panel producers (i.e., manufacturers) 90c 74c 16c

Wood veneer laminated product producersa 7,486 - 13,875 0 7,486 - 13,875

Fabricatorsd 72,492 - 66,103 32,438 40,054 -33,665

Wholesalers 85,560 31,829 53,731

Retailers 759,048 100,898 658,150

Total 924,676 165,239 759,437

a. The TSCA Title VI universe represents the estimated number of firms in the U.S. selling regulated composite wood 

products. 

b. The CARB ATCM baseline compliant firms is the estimated number of firms handling regulated composite wood 

products that may be sold in California.

c. Table numbers indicate the number of mills for stock panel producers

d. The lower estimate for wood veneer laminated product manufactures corresponds to the higher estimate for fabricators, 

and the higher estimate for wood veneer laminated product manufactures corresponds to the lower estimate for 

fabricators.

2816 

2817 2.5.4 Total Estimated Costs of Rule Familiarization, Notification, and Recordkeeping 

2818 and Labeling Requirements 

2819 

2820 The total costs of the recordkeeping, supplier notification, labeling, and rule familiarization 

2821 requirements are estimated by applying the per-firm costs to the number of affected composite panel 

2822 producer, fabricator, wholesaler, and retailer firms by industry. Table 2-84 summarizes these costs, 

2823 except costs to panel producers, under all the options where these requirements are equivalent to the 

2824 CARB ATCM (all options except for the proposed option, Option SCR, SEUR, and SCUR). Table 2-85 

2825 summarizes these costs, except costs to panel producers, under the proposed option (Optionoptions SCR, 

2826 SEUR, and SCUR (the proposed option). Table 2-86 presents the additional recordkeeping costs 

2827 associated with panel production. These additional costs are incurred by stock panel producers and 

2828 laminated product producers under those analytical options that define these producers, or a subset of 

2829 them, as producing hardwood plywood. 

2830 

2831 Under Optionoptions SCR, SEUR, and SCUR, firms that are not manufacturers under TSCA (i.e., 

2832 wholesalers and retailers that do not import composite wood products) are only required to keep bills of 

2833 lading and invoices. Most distributors and retailers are likely to keep these records as part of their 

customary business practices.36 2834 Therefore this recordkeeping requirement is not assumed to impose any 

2835 additional burden on non-manufacturers. In addition, Optionoptions SCR does, SEUR, and SCUR do not 

2836 include a requirement for purchasers to send a separate letter to their suppliers, whereas all the other 

2837 options include such a requirement. 

 36 For example, the Internal Revenue Service recommends that firms keep invoices in order to document their assets, 

expenses, gross receipts, and purchases (U.S. Internal Revenue Service 2007). 

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May 1, 2013 2-155 

2838 

2839 Under Optionoptions SCR, SEUR, and SCUR, importers are required to keep records identifying 

2840 the panel producer and the date that the composite wood products were manufactured, but their customers 

2841 do not need to keep these records. For example, if an importer sells the goods to a domestic distributor 

2842 who then sells them to a domestic retailer, only the importer would have to keep the additional records. 

2843 The domestic distributor and retailer would only be required to keep invoices and bills of lading. 

2844 

2845 This analysis estimates the number of wholesalers who import composite wood products to be 

2846 proportional to the ratio of the value of imports of composite wood products to the sum of the total import 

2847 and domestic shipment values. As shown in Table 2-83, imports represent 28 percent of the value of 

2848 imports and domestic shipments. Thus, it is estimated that 28 percent of wholesalers are importers of 

2849 composite wood products. This results in an estimate that 24,000 of the 86,000 wholesalers import 

2850 composite wood products. The analysis assumes that wholesalers are responsible for all imports and 

2851 retailers do not import products directly without a wholesaler. Since the number of wholesalers that 

2852 import products is estimated using the total customs value of imports (which reflects imports by all 

2853 sectors), to the extent that some products are imported directly by retailers, the number of such retailers 

2854 (and the cost of their recordkeeping) would be reflected in the wholesaler estimate. And to the extent that 

2855 some fabricators import composite wood products directly, the estimated total recordkeeping cost may be 

2856 overstated (since the recordkeeping costs for fabricators are estimated separately). 

2857 

2858 

2859 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-156 

Table 2-83: Customs Value of Imports and Domestic Value of Shipments, by Affected NAICS 

(millions, 2010$) 

NAICS Description 

Customs 

Value of 

Imports 

Domestic 

Value of 

Shipments

Sum of 

Imports and 

Domestic 

Shipments 

321211 Hardwood veneer and plywood manufacturing $1,516 $3,327 $4,843 

321219 Reconstituted wood product manufacturing $1,502 $6,721 $8,223 

321911 Wood window and door manufacturing $491 $14,161 $14,653 

321918 Other millwork (including flooring) $770 $7,483 $8,254 

321991 Manufactured home (mobile home) manufacturing $2 $6,086 $6,089 

321992 Prefabricated wood building manufacturing $50 $4,215 $4,265 

321999 All other miscellaneous wood product manufacturing $1,927 $6,058 $7,984 

336213 Motor home manufacturing $117 $5,779 $5,896 

336214 Travel trailer and camper manufacturing $537 $10,641 $11,178 

337110 Wood kitchen cabinet and countertop manufacturing $491 $18,658 $19,149 

337121 Upholstered household furniture manufacturing $2,898 $11,269 $14,166 

337122 Nonupholstered wood household furniture manufacturing - - - 

337124 Metal household furniture manufacturing $2,708 $2,393 $5,101 

337127 Institutional furniture manufacturing $12,133 $5,799 $17,932 

337129 Wood television, radio, and sewing machine cabinet manufacturing $4 $407 $411 

337211 Wood office furniture manufacturing $697 $2,904 $3,601 

337212 Custom architectural woodwork and millwork manufacturing - - - 

337214 Office furniture (except wood) manufacturing $410 $8,978 $9,388 

337215 Showcase, partition, shelving, and locker manufacturing $4,283 $7,873 $12,156 

339920 Sporting and athletic goods manufacturing $6,260 $12,510 $18,770 

339932 Game, toy, and children's vehicle manufacturing $21,428 $2,712 $24,140 

339950 Sign manufacturing $184 $13,003 $13,187 

339992 Musical instrument manufacturing $1,190 $1,796 $2,986 

Total $59,598 $152,772 $212,370 

Ratio of Customs Value of Imports to Sum of Imports and Domestic Shipments 28% 

Sources: U.S. Census Bureau 2010k, U.S. International Trade Commission 2011 

2860 

2861 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-157 

Table 2-84: Rule Familiarization, Supplier Notification, Labeling and Recordkeeping Costs 

(excluding panel production recordkeeping costs) for Options SE, SI, SP, SN, SC, SFCC, 

CE, CI, NE, and NI (2010$) 

Cost Element Number of 

Affected Firmsa

Average Per-Firm Cost 

for Affected Firmsb

Total Costs 

Stock Panel Producers (excludes laminated product producers) 

Rule Familiarization 62 $294.40 $18,253 

Supplier Notification: Materials 62 $165.20 $10,242 

Supplier Notification: Labor 62 $171.40 $10,627 

Labeling System Setup 62 $149.04 $9,240 

Total Initial Costs $48,362 

Total Annualized Cost (3%) $2,348 

Total Annualized Cost (7%) $3,607 

Fabricators and Laminated Product Producers (including wood veneer laminated product producers defined as 

hardwood plywood panel producers) c

Rule Familiarization 79,978 $294.40 $23,545,523 

Supplier Notification: Materials 47,540 $169.12 $8,039,965 

Supplier Notification: Labor 47,540 $173.88 $8,266,255 

Labeling System Setup (low cost) 64,290 $132.81 $8,538,355 

Labeling System Setup (high cost) 15,688 $4,552.00 $71,411,776 

Total Initial Costs 15,688 $4,552.00 $119,801,874 

Employer Recurring Recordkeeping 2,176 $12,916.80 $28,106,957 

Nonemployer Recurring Recordkeeping 3,054 $179.19 $547,246 

Total Recurring Recordkeeping $28,106,957 654,203

Total Annualized Cost (3%) $33,078,752 

Total Annualized Cost (7%) $35,451,682 

Wholesalers 

Rule Familiarization 85,560 $373.16 $31,927,570 

Supplier Notification: Materials 53,731 $166.32 $8,936,540 

Supplier Notification: Labor 53,731 $178.78 $9,606,028 

Labeling System Setup 855 $4,552.00 $3,891,960 

Recordkeeping System Setup 30,629 $2,510.80 $76,903,293 

Total Initial Costs $131,265,391 

Employer Recurring Recordkeeping 9,436 4,980.30 $46,994,111 

Nonemployer Recurring Recordkeeping 13,666 100.05 $1,367,283 

Total Recurring Recordkeeping $48,361,394 

Total Annualized Cost (3%) $52,385,774 

Total Annualized Cost (7%) $54,544,088 

Retailers 

Rule Familiarization 759,048 $282.84 $214,689,136 

Supplier Notification: Materials 658,150 $22.40 $14,742,560 

Supplier Notification: Labor 658,150 $52.16 $34,329,104 

Total Initial Costs $263,760,800 

Total Annualized Cost (3%) $12,803,648 

Total Annualized Cost (7%) $19,670,370 

a For estimation of number of affected composite panel producers, fabricators, wholesalers, and retailers incurring each cost type, see 

Table 2-78 through Table 2-81. Note that because firms producing two different types of composite wood products are expected to

incur separate costs for each product type, the estimate of 62 stock panel producer firms that is used to estimate costs is derived by 

counting firms that produce two different types of composite wood products twice. There are 54 unique firms that produce stock

panels. 

b For derivation of rule familiarization and supplier notification per-firm costs, see Table 2-71 and Table 2-72; for derivation of initial 

and recurring per-firm recordkeeping and labeling costs, see Table 2-69 and Table 2-70 

c Laminated product producers that are defined as making hardwood plywood may incur additional recordkeeping costs depending on 

the analytical option. These additional costs are presented in Table 2-86. 

2862 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-158 

Table 2-85: Rule Familiarization, Supplier Notification, Labeling and Recordkeeping Costs 

(excluding panel production recordkeeping costs shown in Table 2-86)) for Option SEUR, 

SCR, and SCUR (the proposed option) (2010$) 

Cost Element Number of 

Affected Firmsa

Average Per-Firm Cost 

for Affected Firmsb

Total Costs 

Stock Panel Producers (excludes laminated product producers) 

Rule Familiarization 62 $294.40 $18,253 

Supplier Notification: Materialsd - - - 

Supplier Notification: Labord - - - 

Labeling System Setup 62 $149.04 $9,240 

Total Initial Costs $27,493 

Total Annualized Cost (3%) $1,335 

Total Annualized Cost (7%) $2,050 

Fabricators and Laminated Product Producers (including wood veneer laminated product producers defined as 

hardwood plywood panel producers) c

Rule Familiarization 79,978 $294.40 $23,545,523 

Supplier Notification: Materialsd - - - 

Supplier Notification: Labord - - - 

Labeling System Setup (low costs) 64,290 $132.81 $8,538,355 

Labeling System Setup (high costs) 15,688 $4,552.00 $71,411,776 

Total Initial Costs 15,688 $4,552.00 $103,495,654 

Employer Recurring Recordkeeping 2,176 $12,916.80 $28,106,957 

Nonemployer Recurring Recordkeeping 3,054 $179.19 $547,246 

Total Recurring Recordkeeping $28,654,203 

Total Annualized Cost (3%) $32,287,205 

Total Annualized Cost (7%) $34,235,620 

Wholesalers 

Rule Familiarization 85,560 $373.16 $31,927,570 

Supplier Notification: Materialsd - - - 

Supplier Notification: Labord - - - 

Labeling System Setup 855 $4,552.00 $3,891,960 

Recordkeeping System Setup 8,576 $2,510.80 $21,532,922 

Total Initial Costs $57,352,452 

Employer Recurring Recordkeeping 9,4362,642 $4,980.30 $46,994,11113,158,351

Nonemployer Recurring Recordkeeping 13,6663,826 $100.05 $1,367,283382,839

Total Recurring Recordkeeping $13,541,190 

Total Annualized Cost (3%) $15,667,905 

Total Annualized Cost (7%) $16,808,483 

Retailers 

Rule Familiarization 759,048 $282.84 $214,689,136 

Supplier Notification: Materialsd - - - 

Supplier Notification: Labord - - - 

Total Initial Costs $214,689,136 

Total Annualized Cost (3%) $10,421,579 

Total Annualized Cost (7%) $16,010,775 a For estimation of number of affected composite panel producers, fabricators, wholesalers, and retailers incurring each cost type, see 

Table 2-78 through Table 2-81. Note that because firms producing two different types of composite wood products are expected to

incur separate costs for each product type, the estimate of 62 stock panel producer firms that is used to estimate costs is derived by 

counting firms that produce two different types of composite wood products twice. There are 54 unique firms that produce stock

panels. 

b For derivation of rule familiarization and supplier notification per-firm costs, see Table 2-71, Table 2-72, and Table 2-73; for 

derivation of initial and recurring per-firm recordkeeping and labeling costs, see Table 2-69, Table 2-70, and Table 2-74, c Laminated product producers that are defined as making hardwood plywood may incur additional recordkeeping costs depending on 

the analytical option. These additional costs are presented in Table 2-86. 

d Supplier notification is not required under options SCR, SEUR, and SCUR (the proposed option (Option SCR). 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-159 

2863 

2864 

2865 

Table 2-86: Panel Production Recordkeeping Costs (2010$)

Regulatory Option Number of 

Affected 

Firmsa

Average PerFirm Cost for 

Affected Firmsb

Total Costs Total 

Annualized 

Cost (3%) 

Total 

Annualized 

Cost (7%) 

Stock Panel Producers (excludes laminated product producers) 

All Options 62 $3,711 710.72 $230,065 $11,168218,897 $17,157212,908 

Laminated Product Producers (Low Estimate)

Option SE, SEUR, 

SFCC, CE, NE - - - - - 

Option SI, CI, NI 7,486 $3,710.72 $27,778,450 $26,430,010 $25,706,829 

Option SP 50 $3,710.72 $185,536 $176,530 $171,699 

Option SN 7,486 $3,710.72 $27,778,450 $26,430,010 $25,706,829 

Option SC, SCR, 

SCUR 150 $3,710.72 $556,608 $529,589 $515,098 

Laminated Product Producers (High Estimate) 

Option SE, SFCC, 

SEUR, CE, NE - - - - - 

Option SI, CI, NI 13,875 $3,710.72 $51,486,240 $48,986,962 $47,646,574 

Option SP 50 $3,710.72 $185,536 $176,530 $171,699 

Option SN 13,875 $3,710.72 $51,486,240 $48,986,962 $47,646,574 

Option SC, SCR, 

SCUR 277 $3,710.72 $1,027,869 $977,974 $951,214 

2866 

2867 

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

May 1, 2013 2-160 

2868 2.6 Total Costs of the Proposed TSCA Title VI Implementation Rule 

2869 

2870 Table 2-87 presents the total undiscounted first and subsequent year costs and Table 2-88 presents 

2871 the annualized costs of the proposed TSCA Title VI Implementation Rule. The costs are presented by 

2872 analytical option and cost scenario for wood veneer laminated product producers (i.e., a low end estimate 

2873 of 7,486 and a high end estimate of 13,875 for the number of affected wood veneer laminated product 

2874 producers, and assuming 1 or 2 product lines requiring certification for the options where certification is 

2875 applicable). Note that the laminator’s costs presented in Table 2-87 and Table 2-88 include the costs to 

2876 all wood veneer laminated product producers regardless of the requirements under each analytical option 

2877 presented. For example, under Option SESEUR all laminated product producers are defined as 

2878 fabricators, but their costs are still reported separately in the laminator rows of the tables. 

2879 

2880 For the options with emissions requirements that are consistent with TSCA Title VI (Options SE, 

2881 SI, SP, SN, SC, SCR, SEUR, SFCC, and SCRSCUR), the first year costs range from $435420 million to 

2882 $1,254 million and the annualized costs range from $7260 million to $293311 million per year. The 

2883 proposed option (Option SCRSCUR) has first year costs of $435434 million to $447 million. The 

2884 annualized costs under Option SCRSCUR range from $72 million to $81 million per year using a 3 

2885 percent discount rate, which is $2312 to $3221 million lessmore than the next least expensive option with 

2886 emissions requirements that are consistent with the statute (Option SESEUR). 

2887 

2888 Options CE and CI, the least stringent options in terms of emissions standards (which are 

2889 presented for information purposes since they are not consistent with the emissions requirements of the 

2890 statute), have estimated annualized costs ranging from $99 to $292 million per year using a 3 percent 

2891 discount rate. The estimated costs under Options CE and CI are similar to the estimated costs under the 

2892 options with emissions requirements consistent with the statute, because recordkeeping, labeling, testing 

2893 and certification are the primary cost drivers and loosening emissions standards does not affect these 

2894 costs. 

2895 

2896 Options NE and NI, the most stringent options in terms of emissions standards (which are also 

2897 presented for information purposes since they are not consistent with the emissions requirements of the 

2898 statute), have estimated annualized costs ranging from $379 to $573 million using a 3 percent discount 

2899 rate. The additional costs associated with changes to raw materials and production processes account for 

2900 the difference between the costs under these options compared to the options with emissions requirements 

2901 that are consistent with the statute (SE, SI, SP, SN, SC, SCR, and SCRSCUR). 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-161 

Table 2-87: Estimated Total First and Subsequent Year Costs (millions, 2010$)1

Analytical Option Entity Type 

First Year Subsequent Years 

1 Product Lines 2 Product Lines 1 Product Lines 2 Product Lines 

Low End 

Scenario 

High 

End 

Scenario

Low End 

Scenario

High 

End 

Scenario

Low End 

Scenario

High 

End 

Scenario

Low End 

Scenario

High 

End 

Scenario 

Option SE: Statutory emissions 

standards where all wood veneer 

laminated products are exempt 

from the definition of hardwood 

plywood 

Producers $3 $3 $3 $3 $2 $2 $2 $2 

Fabricators2 $105 $68 $105 $68 $24 $20 $24 $20 

Retailers $264 $264 $264 $264 $0 $0 $0 $0 

Wholesalers $180 $180 $180 $180 $48 $48 $48 $48 

Laminators3 $43 $80 $43 $80 $5 $8 $5 $8 

Total $595 $595 $595 $595 $79 $79 $79 $79 

Option SI: Statutory emissions 

standards where all wood veneer 

laminated products are included in 

the definition of hardwood 

plywood 

Producers $3 $3 $3 $3 $2 $2 $2 $2 

Fabricators2 $105 $68 $105 $68 $24 $20 $24 $20 

Retailers $264 $264 $264 $264 $0 $0 $0 $0 

Wholesalers $180 $180 $180 $180 $48 $48 $48 $48 

Laminators3 $368 $670 $406 $740 $103 $178 $108 $188 

Total $919 $1,184 $957 $1,254 $177 $249 $182 $258 

Option SP: Statutory emissions 

standards where all laminated 

products other than Custom 

Plywood and Architectural Panels 

are exempt from the definition of 

hardwood plywood 

Producers $3 $3 $3 $3 $2 $2 $2 $2 

Fabricators2 $105 $68 $105 $68 $24 $20 $24 $20 

Retailers $264 $264 $264 $264 $0 $0 $0 $0 

Wholesalers $180 $180 $180 $180 $48 $48 $48 $48 

Laminators3 $48 $85 $49 $86 $8 $12 $8 $12 

Total $600 $600 $600 $600 $8382 $8382 $8382 $8382 

Option SN: Statutory emissions 

standards where all wood veneer 

laminated products made using 

NAF resins to attach wood 

veneers to NAF platforms are 

exempt from the definition of 

hardwood plywood. 

Producers $3 $3 $3 $3 $2 $2 $2 $2 

Fabricators2 $105 $68 $105 $68 $24 $20 $24 $20 

Retailers $264 $264 $264 $264 $0 $0 $0 $0 

Wholesalers $180 $180 $180 $180 $48 $48 $48 $48 

Laminators3 $10275 $172122 $10477 $175124 $6134 $9645 $6235 $9847 

Total $654626 $687636 $655628 $689639 $136108 $167116 $137109 $168118 

Option SC: Statutory emissions 

standards where laminated 

products made with compliant 

platforms and NAF resins are 

exempt from the definition of 

hardwood plywood.

Producers $3 $3 $3 $3 $2 $2 $2 $2 

Fabricators2 $105 $68 $105 $68 $24 $20 $24 $20 

Retailers $264 $264 $264 $264 $0 $0 $0 $0 

Wholesalers $180 $180 $180 $180 $48 $48 $48 $48 

Laminators3 $58 $105 $59 $107 $17 $28 $18 $30 

Total $609 $619 $611 $621 $91 $99 $92 $101 

Option SCR: Proposed Option.

Statutory emissions standards 

where laminated products made 

with compliant platforms and 

NAF resins are exempt from the 

definition of hardwood plywood.

Reduced Recordkeeping.

Producers $3 $3 $3 $3 $2 $2 $2 $2 

Fabricators2 $91 $57 $91 $57 $24 $20 $24 $20 

Retailers $215 $215 $215 $215 $0 $0 $0 $0 

Wholesalers $71 $71 $71 $71 $14 $14 $14 $14 

Laminators3 $55 $100 $57 $102 $17 $28 $18 $30 

Total $435 $445 $436 $447 $5756 $64 $57 $66 

Option SEUR: Statutory 

emissions standards where all 

wood veneer laminated products 

are exempt from the definition of 

hardwood plywood. ULEF 

Exemption. Reduced 

Recordkeeping.

Producers $2 $2 $2 $2 $1 $1 $1 $1 

Fabricators2 $91 $57 $91 $57 $24 $20 $24 $20 

Retailers $215 $215 $215 $215 $0 $0 $0 $0 

Wholesalers $71 $71 $71 $71 $14 $14 $14 $14 

Laminators3 $41 $76 $41 $76 $5 $8 $5 $8 

Total $420 $420 $420 $420 $44 $44 $44 $44 

Option CE: CARB 1SFCC:

Statutory emissions standards 

where all wood veneer laminated 

products are exempt from the 

Producers $12 $12 $12 $12 $1 $1 $1 $1 

Fabricators2 $105 $68 $105 $68 $24 $20 $24 $20 

Retailers $264 $264 $264 $264 $0 $0 $0 $0 

Wholesalers $180 $180 $180 $180 $48 $48 $48 $48 

Formatted Table

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

May 1, 2013 2-162 

Table 2-87: Estimated Total First and Subsequent Year Costs (millions, 2010$)1

Analytical Option Entity Type 

First Year Subsequent Years 

1 Product Lines 2 Product Lines 1 Product Lines 2 Product Lines 

Low End 

Scenario 

High 

End 

Scenario

Low End 

Scenario

High 

End 

Scenario

Low End 

Scenario

High 

End 

Scenario

Low End 

Scenario

High 

End 

Scenario 

definition of hardwood plywood. 

ULEF Exemption. CARB 

Recordkeeping.

Laminators3 $43 $80 $43 $80 $5 $8 $5 $8 

Total $594 $594 $594 $594 $78 $78 $78 $78 

Option SCUR: Proposed Option. 

Statutory emissions standards 

where laminated products made 

with compliant platforms and 

NAF resins are exempt from the 

definition of hardwood plywood. 

ULEF Exemption. Reduced 

Recordkeeping

Producers $2 $2 $2 $2 $1 $1 $1 $1 

Fabricators2 $91 $57 $91 $57 $24 $20 $24 $20 

Retailers $215 $215 $215 $215 $0 $0 $0 $0 

Wholesalers $71 $71 $71 $71 $14 $14 $14 $14 

Laminators3 $55 $100 $57 $102 $17 $28 $18 $30 

Total $434 $444 $436 $447 $56 $64 $57 $65 

Option CE: CARB 1 emissions 

standards where all wood veneer

laminated products are exempt 

from the definition of hardwood 

plywood

Producers $1 $1 $1 $1 $1 $1 $1 $1 

Fabricators2 $105 $68 $105 $68 $24 $20 $24 $20 

Retailers $264 $264 $264 $264 $0 $0 $0 $0 

Wholesalers $180 $180 $180 $180 $48 $48 $48 $48 

Laminators3 $43 $80 $43 $80 $5 $8 $5 $8 

Total $593 $593 $593 $593 $78 $78 $78 $78 

Option CI: CARB 1 emissions 

standards where all wood veneer 

laminated products are included in 

the definition of hardwood 

plywood 

Producers $1 $1 $1 $1 $1 $1 $1 $1 

Fabricators2 $105 $68 $105 $68 $24 $20 $24 $20 

Retailers $264 $264 $264 $264 $0 $0 $0 $0 

Wholesalers $180 $180 $180 $180 $48 $48 $48 $48 

Laminators3 $368 $670 $406 $740 $103 $178 $108 $188 

Total $918 $1,183 $956 $1,253 $176 $248 $181 $257 

Option NE: NAF emissions 

standards where all wood veneer 

laminated products are exempt 

from the definition of hardwood 

plywood 

Producers $297 $297 $297 $297 $295 $295 $295 $295 

Fabricators2 $105 $68 $105 $68 $24 $20 $24 $20 

Retailers $264 $264 $264 $264 $0 $0 $0 $0 

Wholesalers $180 $180 $180 $180 $48 $48 $48 $48 

Laminators3 $43 $80 $43 $80 $5 $8 $5 $8 

Total $889 $889 $889 $889 $372 $372 $372 $372 

Option NI: NAF emissions 

standards where all wood veneer 

laminated products are included in 

the definition of hardwood 

plywood 

Producers $297 $297 $297 $297 $295 $295 $295 $295 

Fabricators2 $105 $68 $105 $68 $24 $20 $24 $20 

Retailers $264 $264 $264 $264 $0 $0 $0 $0 

Wholesalers $180 $180 $180 $180 $48 $48 $48 $48 

Laminators3 $368 $670 $406 $740 $103 $178 $108 $188 

Total $1,214 $1,479 $1,252 $1,549 $471 $542 $476 $552 

Option SCRSCUR is the proposed option. 1

 Low and high end scenarios reflect the estimated number of laminators and the number of product lines certified per firm, not the 

low and high costs for each category of entities. 

2 To avoid double-counting, this row represents costs to fabricators that are not laminators. Costs under the “Low End Scenario”

reflect the low end of the estimated number of laminators (approximately 7,000 firms), and costs under the “High End Scenario” 

reflect the high end estimate of the number of laminators (approximately 14,000 firms). The estimated number of fabricators that 

are not laminators is inversely proportional to the estimated number of laminators. So in the Low End Scenario there are 73,000 

fabricators that are not laminators, and in the High End Scenario there are 66,000 firms that are not laminators. As a result, the 

costs to fabricators that are not laminators are higher under the “Low End Scenario” then under the “High End Scenario”. 3 Costs to laminators represent the costs to all firms that affix a wood or woody grass veneer to a purchased particleboard, MDF or 

veneer core platform. This includes both laminators that are considered panel producers under the proposed rule and laminators

that are considered fabricators under the proposed rule. 

2902 

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

May 1, 2013 2-163 

Table 2-88: Estimated Total Annualized Costs (millions, 2010$)1

Analytical Option Entity Type 

Total Annualized Costs 

(3 Percent) 

Total Annualized Costs 

(7 Percent) 

1 Product Lines 2 Product Lines 1 Product Lines 2 Product Lines 

Low 

End 

Scenario 

High 

End 

Scenario

Low 

End 

Scenario

High 

End 

Scenario

Low 

End 

Scenario

High 

End 

Scenario

Low 

End 

Scenario

High 

End 

Scenario 

Option SE: Statutory emissions 

standards where all wood veneer 

laminated products are exempt 

from the definition of hardwood 

plywood 

Producers $2 $2 $2 $2 $2 $2 $2 $2 

Fabricators2 $27 $22 $27 $22 $28 $22 $28 $22 

Retailers $13 $13 $13 $13 $20 $20 $20 $20 

Wholesalers $52 $52 $52 $52 $55 $55 $55 $55 

Laminators3 $6 $11 $6 $11 $7 $13 $7 $13 

Total $100 $100 $100 $100 $112 $112 $112 $112 

Option SI: Statutory emissions 

standards where all wood veneer 

laminated products are included in 

the definition of hardwood plywood 

Producers $2 $2 $2 $2 $2 $2 $2 $2 

Fabricators2 $27 $22 $27 $22 $28 $22 $28 $22 

Retailers $13 $13 $13 $13 $20 $20 $20 $20 

Wholesalers $52 $52 $52 $52 $55 $55 $55 $55 

Laminators3 $99110 $193 $106117 $205 $103114 $200 $110121 $212 

Total $194204 $282 $200211 $293 $208218 $298 $215225 $311 

Option SP: Statutory emissions 

standards where all laminated 

products other than Custom 

Plywood and Architectural Panels 

are exempt from the definition of 

hardwood plywood 

Producers $2 $2 $2 $2 $2 $2 $2 $2 

Fabricators2 $27 $22 $27 $22 $28 $22 $28 $22 

Retailers $13 $13 $13 $13 $20 $20 $20 $20 

Wholesalers $52 $52 $52 $52 $55 $55 $55 $55 

Laminators3 $10 $15 $10 $15 $10 $16 $10 $16 

Total $104 $104 $104 $104 $115 $115 $115 $115 

Option SN: Statutory emissions 

standards where all wood veneer 

laminated products made using 

NAF resins to attach wood veneers 

to NAF platforms are exempt from 

the definition of hardwood 

plywood. 

Producers $2 $2 $2 $2 $2 $2 $2 $2 

Fabricators2 $27 $22 $27 $22 $28 $22 $28 $22 

Retailers $13 $13 $13 $13 $20 $20 $20 $20 

Wholesalers $52 $52 $52 $52 $55 $55 $55 $55 

Laminators3 $4934 $9547 $5035 $9749 $4934 $9448 $5035 $9649 

Total $143128 $184136 $144129 $185137 $154139 $193146 $155140 $195148 

Option SC: Statutory emissions 

standards where laminated products 

made with compliant platforms and 

NAF resins are exempt from the 

definition of hardwood plywood.

Producers $2 $2 $2 $2 $2 $2 $2 $2 

Fabricators2 $27 $22 $27 $22 $28 $22 $28 $22 

Retailers $13 $13 $13 $13 $20 $20 $20 $20 

Wholesalers $52 $52 $52 $52 $55 $55 $55 $55 

Laminators3 $18 $31 $19 $32 $19 $32 $19 $33 

Total $112 $119 $113 $121 $123 $130 $124 $132 

Option SCR: Proposed Option.

Statutory emissions standards 

where laminated products made 

with compliant platforms and NAF 

resins are exempt from the 

definition of hardwood plywood. 

Reduced paperwork requirements 

for Recordkeeping.

Producers $2 $2 $2 $2 $2 $2 $2 $2 

Fabricators2 $26 $21 $26 $21 $27 $21 $27 $21 

Retailers $10 $10 $10 $10 $16 $16 $16 $16 

Wholesalers $16 $16 $16 $16 $17 $17 $17 $17 

Laminators3 $18 $30 $19 $32 $18 $31 $19 $33 

Total $72 $8079 $73 $81 $8180 $88 $81 $89 

Option SEUR: Statutory emissions 

standards where all wood veneer

laminated products are 

exempt from the definition of 

hardwood plywood. ULEF 

Exemption. Reduced 

Recordkeeping.

Producers $1 $1 $1 $1 $1 $1 $1 $1 

Fabricators2 $26 $21 $26 $21 $27 $21 $27 $21 

Retailers $10 $10 $10 $10 $16 $16 $16 $16 

Wholesalers $16 $16 $16 $16 $17 $17 $17 $17 

Laminators3 $6 $11 $6 $11 $7 $13 $7 $13 

Total $60 $60 $60 $60 $68 $68 $68 $68 

Option CE: CARB 1SFCC:

Statutory emissions standards 

Producers $1 $1 $1 $1 $1 $1 $1 $1 

Fabricators2 $27 $22 $27 $22 $28 $22 $28 $22 

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

May 1, 2013 2-164 

Table 2-88: Estimated Total Annualized Costs (millions, 2010$)1

Analytical Option Entity Type 

Total Annualized Costs 

(3 Percent) 

Total Annualized Costs 

(7 Percent) 

1 Product Lines 2 Product Lines 1 Product Lines 2 Product Lines 

Low 

End 

Scenario 

High 

End 

Scenario

Low 

End 

Scenario

High 

End 

Scenario

Low 

End 

Scenario

High 

End 

Scenario

Low 

End 

Scenario

High 

End 

Scenario 

where all wood veneer laminated 

products are exempt from the 

definition of hardwood plywood. 

ULEF Exemption. CARB 

Recordkeeping.

Retailers $13 $13 $13 $13 $20 $20 $20 $20 

Wholesalers $52 $52 $52 $52 $55 $55 $55 $55 

Laminators3 $6 $11 $6 $11 $7 $13 $7 $13 

Total $100 $100 $100 $100 $111 $111 $111 $111 

Option SCUR: Proposed Option. 

Statutory emissions standards 

where laminated products made 

with compliant platforms and NAF 

resins are exempt from the 

definition of hardwood plywood. 

ULEF Exemption. Reduced 

Recordkeeping.

Producers $1 $1 $1 $1 $1 $1 $1 $1 

Fabricators2 $26 $21 $26 $21 $27 $21 $27 $21 

Retailers $10 $10 $10 $10 $16 $16 $16 $16 

Wholesalers $16 $16 $16 $16 $17 $17 $17 $17 

Laminators3 $18 $30 $19 $32 $18 $31 $19 $33 

Total $72 $79 $72 $81 $80 $87 $81 $89 

Option CE: CARB 1 emissions 

standards where all wood veneer 

laminated products are exempt 

from the definition of hardwood 

plywood

Producers $1 $1 $1 $1 $1 $1 $1 $1 

Fabricators2 $27 $22 $27 $22 $28 $22 $28 $22 

Retailers $13 $13 $13 $13 $20 $20 $20 $20 

Wholesalers $52 $52 $52 $52 $55 $55 $55 $55 

Laminators3 $6 $11 $6 $11 $7 $13 $7 $13 

Total $99 $99 $99 $99 $111 $111 $111 $111 

Option CI: CARB 1 emissions 

standards where all wood veneer 

laminated products are included in 

the definition of hardwood plywood 

Producers $1 $1 $1 $1 $1 $1 $1 $1 

Fabricators2 $27 $22 $27 $22 $28 $22 $28 $22 

Retailers $13 $13 $13 $13 $20 $20 $20 $20 

Wholesalers $52 $52 $52 $52 $55 $55 $55 $55 

Laminators3 $99110 $193 $106117 $205 $103114 $200 $110121 $212 

Total $192203 $281 $199210 $292 $207217 $297 $214224 $310 

Option NE: NAF emissions 

standards where all wood veneer 

laminated products are exempt 

from the definition of hardwood 

plywood 

Producers $281 $281 $281 $281 $274 $274 $274 $274 

Fabricators2 $27 $22 $27 $22 $28 $22 $28 $22 

Retailers $13 $13 $13 $13 $20 $20 $20 $20 

Wholesalers $52 $52 $52 $52 $55 $55 $55 $55 

Laminators3 $6 $11 $6 $11 $7 $13 $7 $13 

Total $379 $379 $379 $379 $383 $383 $383 $383 

Option NI: NAF emissions 

standards where all wood veneer 

laminated products are included in 

the definition of hardwood plywood 

Producers $281 $281 $281 $281 $274 $274 $274 $274 

Fabricators2 $27 $22 $27 $22 $28 $22 $28 $22 

Retailers $13 $13 $13 $13 $20 $20 $20 $20 

Wholesalers $52 $52 $52 $52 $55 $55 $55 $55 

Laminators3 $99110 $193 $106117 $205 $103114 $200 $110121 $212 

Total $473484 $561 $479490 $573 $480490 $570 $486497 $582 

Option SCRSCUR is the proposed option. 1

 Low and high end scenarios reflect the estimated number of laminators and the number of product lines certified per firm, not the 

low and high costs for each category of entities. 

2 To avoid double-counting, this row represents costs to fabricators that are not laminators. Costs under the “Low End Scenario”

reflect the low end of the estimated number of laminators (approximately 7,000 firms), and costs under the “High End Scenario” 

reflect the high end estimate of the number of laminators (approximately 14,000 firms). The estimated number of fabricators that are 

not laminators is inversely proportional to the estimated number of laminators. So in the Low End Scenario there are 73,000 

fabricators that are not laminators, and in the High End Scenario there are 66,000 firms that are not laminators. As a result, the costs 

to fabricators that are not laminators are higher under the “Low End Scenario” then under the “High End Scenario”. 3 Costs to laminators represent the costs to all firms that affix a wood or woody grass veneer to a purchased particleboard, MDF or 

veneer core platform. This includes both laminators that are considered panel producers under the proposed rule and laminators that 

are considered fabricators under the proposed rule. 

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

May 1, 2013 2-165 

2903 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-166 

2904 2.7 Summary of Costs by Entity Type and Activity for Options SI, SE, SCR, 

2905 SEUR, and SCUR

2906 

2907 Table 2-89 through Table 2-93 present a summary of the per-entity and total costs for analytical 

2908 options SI, SE, SCR, SEUR, and SCUR. The costs presented in these tables are broken out by the type of 

2909 entity, the baseline status under the CARB ATCM, and the activity being performed.
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-167 

2910 

Table 2-89: Option SE: Activities with Cost Estimates, by Type of Entity and Baseline Status, Incremental to the CARB ATCM

Type of 

Entity

Baseline Status under 

CARB ATCM a

Number of 

Entities or 

Production 

Volume b

Activities with Incremental Costs 

Estimated

Average Incremental Cost per Entity c Number of Entities or 

Production Volume 

Incurring Non-Zero 

Costs

Percent 

Incurring Non-Zero 

Costs

Total Cost (mil

2010$)

Initial Start-up 

or First Year Costs

Annual Recurring 

Costs in 

Subsequent Years

First 

Year

Subse

Ye

Panel manufacturers 

All panel manufacturers 62 entities

Become familiar with TSCA rule $294 - - - 62 100% $0.02 - Supplier Notification $337 - - - 62 100% $0.02 - On-site daily quality control testing d 0 or $10,832 0 or $832 34 55% $0.4 $0Set-up to label products as TSCA compliant $149 `- - - 62 100% $0.009 - Keep additional records $3,711 62 100% $0.2 $

Manufacture products not certified under CARB ATCM 

16 entities and 

49.6 msf of 

production

Have products tested and certified by a TPC e $5,185 to $31,183 $2,365 to $6,230 16 100% $0.4 $0Changes to raw materials f 0 or $20 to $110 per thousand square feet (msf) of product produced 47,300 msf 95% $1.1 $

Manufacture products certified as ULEF under CARB ATCM

17 entities Have products tested and certified as Phase 2 or NAF by a TPC e $12,312 to $51,292 ($2,790) to $51,292 17 100% $0.6 $

Wood veneer laminated product manufacturers

All laminatorsg,h 7,486 to 13,875 entities

Become familiar with the TSCA rule $294 - - - 7,486 to 13,875 100% $2.2 to $4.1 - Supplier Notification $343 - - - 7,486 to 13,875 100% $2.6 to $4.8Set-up to label products as TSCA compliant $4,552 - - - 7,486 to 13,875 100% $34.1 to $63.2 - Keep additional recordsi,j Non-employer firms: 0 or $179 Employer firms: 0 or $12,917 481 to 891 non-emplyr 343 to 635 employer 11% $4.5 to $8.4 $4.5 t

Fabricators that are not laminators

All fabricators that are not laminators

66,103 to 72,492 entities

Become familiar with the TSCA rule k $294 - - - 66,103 to 72,492 100% $19.5 to $21.3 - Set-up to label products as TSCA compliant k, l

$133 

or 

$4,552

- - -

64,290 minor cost; 

1,813 to 8,202 more 

substantive cost

100% $16.8 to $45.9 - 

Fabricators not compliant with CARB ATCM requirements 

33,665 to 40,054 entities

Supplier Notification $343 - - - 33,665 to 40,054 100% $11.5 to $13.7 - Keep additional records j, k

Non-employer firms: 0 or $179 

Employer firms: 0 or $12,917

2,163 to 2,573 nonemployers; 1,541 to 

1,833 employers

11% $20.3 to $24.1 $20

$2

Wholesalers All wholesalers 85,560 entities Become familiar with the TSCA rule $373 - - - 85,560 100% $31.9 - 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-168 

Table 2-89: Option SE: Activities with Cost Estimates, by Type of Entity and Baseline Status, Incremental to the CARB ATCM

Type of 

Entity

Baseline Status under 

CARB ATCM a

Number of 

Entities or 

Production 

Volume b

Activities with Incremental Costs 

Estimated

Average Incremental Cost per Entity c Number of Entities or 

Production Volume 

Incurring Non-Zero 

Costs

Percent 

Incurring Non-Zero 

Costs

Total Cost (mil

2010$)

Initial Start-up 

or First Year Costs

Annual Recurring 

Costs in 

Subsequent Years

First 

Year

Subse

Ye

If repackaging or replacing an original label, set-up to label products as TSCA compliant

$4,552 - - - 855 1% $3.9 - 

Wholesalers that are not compliant with CARB ATCM 

53,731 entities m

Supplier Notification $345 53,731 100% $18.5 - Set up systems to keep additional records n 0 or $2,511 - - - 30,629 57% $76.9 - Keep additional records o Non-employer firms: 0 or $100 Employer firms: 0 or $4,980 3,826 non-employers; 2,642 employer 43% $48.4 $4

Retailers

All retailers 759,048 entities Become familiar with the TSCA rule $283 - - - 759,048 100% $214.7 - Retailers that are not compliant with CARB ATCM

658,150 entities Supplier Notification $75 - - - 658,150 100% $49.1 - 

Total Rule Cost $595 $a Categories designated as “All” entities (e.g., All Panel Manufacturers, All Wholesalers, etc.) apply to all entities in the U.S. selling composite wood products, including both entities that compwith the CARB ATCM and those that do not. For each industry, the various sub-categories in the baseline status column (such as entities not compliant with the CARB ATCM) are subsets of t“All” entity categories. Some products are not certified under the CARB ATCM in the baseline because they are not sold in California, and some firms are not compliant with the labeling and recordkeeping requirements in the CARB ATCM because their products are not intended for sale in California. b Estimated number of entities reflects those entities selling composite wood products or goods containing regulated composite wood products. Production volume is only listed for entities with cost estimated for a change in raw materials, in which case it is reported in thousand square feet (msf) of product produced. c Reported values represent average incremental costs, which characterize a population where some entities incur costs below average and others incur costs that are above average. For activitiwith a single value reported spanning both cost columns, entities are estimated to incur the same average annual cost in the first year and in subsequent years. For changes to raw materials, the cost is based on the production volume affected rather than the number of entities affected.d Panel producers with a standard certification or a new NAF certification are assumed to conduct daily on-site quality control testing in order to comply with the proposed requirement that testlots must be held until test results indicate that the emissions standard has been met. Particleboard and MDF manufacturers are assumed to be conducting daily on-site quality control testing to comply with the CARB ATCM, and do not incur incremental costs for this activity. Hardwood plywood producers with an existing ULEF or NAF certification will already have been exemptefrom quality control testing. Hardwood plywood manufacturers with a standard certification are assumed to send panels to an off-site lab for quality control testing in the baseline, and thus wouincur incremental costs to conduct daily on-site testing. Hardwood plywood manufacturers with a new NAF certification are assumed to conduct daily on-site quality control testing for the first months. e Incremental testing costs depend on several factors including the type of composite wood product, the number of products certified, the baseline CARB ATCM certification level (PhULEF, or NAF), and the TSCA certification level. Elsewhere in the report testing and certification costs are reported as the sum of this value and the cost of on-site daily quality control testingf Estimated raw materials costs vary with the type of composite wood product, the resin used in the baseline, and the composition of the core or platform used for hardwood plywood in the baseOf the estimated 4.6 million square feet (mmsf) of hardwood plywood that is not certified under the CARB ATCM, producers are estimated to incur incremental costs of $50/msf (3/8” basis) fochanges to resin system for 2.3 mmsf (and additional costs of $60/msf for switching to low emission cores for a fraction of that production volume). The remaining hardwood plywood productvolume is not estimated to need to make raw materials changes because it meets the emission standard in the baseline. All MDF production is estimated to comply with the emission standards 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-169 

Table 2-89: Option SE: Activities with Cost Estimates, by Type of Entity and Baseline Status, Incremental to the CARB ATCM

Type of 

Entity

Baseline Status under 

CARB ATCM a

Number of 

Entities or 

Production 

Volume b

Activities with Incremental Costs 

Estimated

Average Incremental Cost per Entity c Number of Entities or 

Production Volume 

Incurring Non-Zero 

Costs

Percent 

Incurring Non-Zero 

Costs

Total Cost (mil

2010$)

Initial Start-up 

or First Year Costs

Annual Recurring 

Costs in 

Subsequent Years

First 

Year

Subse

Ye

baseline, so MDF producers are not expected to make raw materials changes. Particleboard producers are estimated to incur incremental costs of $20/msf (3/4” basis) for raw materials changes all the 45 mmsf of production volume that is not certified under the CARB ATCM in the baseline. The remaining particleboard production is not estimated to make raw materials changes becameets the emission standard in the baseline. Thus, of the 49.6 mmsf of composite wood manufactured by stock panel producers that is not certified under the CARB ATCM, 47.3 mmsf (95%) estimated to change raw materials.g All laminators are defined as fabricators under Option SE and do not incur costs to change raw materials, or to test and certify products, under this option.h Under Option SE all laminators are defined as fabricators. i To simplify the cost calculations, recordkeeping costs for this group are calculated assuming that none of these entities are compliant with the CARB ATCM in the baseline. j Based on conversations with fabricators complying with the CARB ATCM, 11% of all fabricators (including laminators) that are not already complying with the CARB ATCM are assumed to incur additional recurring recordkeeping costs averaging $12,917 for employer firms and $179 for non-employer firms to comply with the recordkeeping requirements in the TSCA rule (althourecurring recordkeeping costs for these entities are assumed to be a function of firm size as measured by revenues). The analysis estimates that 11% of laminators incur these costs. k There are 79,978 fabricators, which can be categorized as laminators or as fabricators that are not laminators. Total costs depend on how many entities are in each group. The higher estimate the number of laminators corresponds to the lower estimate for the number of fabricators that are not laminators, so total costs vary inversely between the two groups. Thus, when adding all the rows together to yield the Total Rule Cost in the final row of this table, the order of the Total Cost ranges for this row must be reversed. Under Option SE there is no low and high value for the cost. The cost ranges for laminators and fabricator that are not laminators reflect different estimates for the number of laminators. That is, the low estimate reflects 7,846 laminators and 72,492 fabricators that are not laminators, which is a total of 79,978 firms; the high estimate reflects 13,875 laminators and 66,103 fabricators that are not laminators, which is also 79,978 firms combinThus, there are 79,978 firms defined as fabricators in both cases.l Based on conversations with fabricators complying with the CARB ATCM, all firms that are complying with the CARB ATCM and 67% of firms that are not already complying with the CARATCM are assumed to incur minor costs for setting up new labels ($133), while 33% of firms that are not already complying with the CARB ATCM are assumed to incur more substantive cost(averaging $4,552) to set up labels.m The analysis estimates that 53,731 wholesalers are not CARB compliant in the baseline.n Under Option SE, firms must keep additional records equivalent to those required by the CARB ATCM. However, firms that are compliant with the CARB ATCM will already be keeping sufficient records to comply with the requirements. In conversations with entities complying with the CARB ATCM, 57% of wholesalers reported incurring average costs of $2,511 to set up recordkeeping systems to comply with the rule. (Fabricators and retailers did not report incurring such costs.) So 57% of the wholesalers and are not compliant with the CARB ATCM are estimto incur costs averaging $2,511 to update their recordkeeping systems to comply with Option SE. The existing recordkeeping systems at the remaining wholesalers, as well as at panel manufacturers, laminators, and fabricators, are assumed to be sufficient to comply with the TSCA rule.o Based on conversations with wholesalers complying with the CARB ATCM, 43% of wholesalers that are not already complying with the CARB ATCM are assumed to incur additional recurrrecordkeeping costs. They are estimated to incur costs averaging $4,890 per firm for employer firms and $100 for non-employer firms to comply with Option SE (although recurring recordkeecosts for these entities are assumed to be a function of firm size as measured by revenues). The remaining wholesalers are not estimated to incur these recordkeeping costs because their existinrecords are sufficient to comply with the rule’s requirements.

2911 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-170 

2912 

Table 2-90: Option SI: Activities with Cost Estimates, by Type of Entity and Baseline Status, Incremental to the CARB ATCM

Type of 

Entity

Baseline Status under 

CARB ATCM a

Number of 

Entities or 

Production 

Volume b

Activities with Incremental Costs 

Estimated

Average Incremental Cost per Entity c Number of Entities or 

Production Volume 

Incurring Non-Zero 

Costs

Percent 

Incurring Non-Zero 

Costs

Total Cost (mil

2010$)

Initial Start-up 

or First Year Costs

Annual Recurring 

Costs in 

Subsequent Years

First 

Year

Subse

Ye

Panel manufacturers 

All panel manufacturers 62 entities

Become familiar with TSCA rule $294 - - - 62 100% $0.02 - Supplier Notification $337 - - - 62 100% $0.02 - On-site daily quality control testing d 0 or $10,832 0 or $832 34 55% $0.4 $0Set-up to label products as TSCA compliant $149 `- - - 62 100% $0.009 - Keep additional records $3,711 62 100% $0.2 $

Manufacture products not certified under CARB ATCM 

16 entities and 

49.6 msf of 

production

Have products tested and certified by a TPC e $5,185 to $31,183 $4,485 to $6,230 16 100% $0.4 $0Changes to raw materials f 0 or $20 to $110 per thousand square feet (msf) of product produced 47,300 msf 95% $1.1 $

Manufacture products certified as ULEF under CARB ATCM

17 entities Have products tested and certified as Phase 2 or NAF by a TPC e $12,312 to $51,292 ($2,806) to $51,292 17 100% $0.6 $

Wood veneer laminated product manufacturers

All laminatorsh

7,486 to 13,875 entities and 362,414 msf of production

Become familiar with the TSCA rule $294 - - - 7,486 to 13,875 100% $2.2 to $4.1 - Supplier Notification $343 - - - 7,486 to 13,875 100% $2.6 to $4.8Set-up to label products as TSCA compliant $4,552 - - - 7,486 to 13,875 100% $34.1 to $63.2 - Have products tested and certified by a TPC e $26,226 to $70,782 $5,685 to $61,950 7,486 to 13,875 100%

$201.6 

to 

$443.6

$50

$1

On-site daily quality control testing d $10,832 $832 7,486 to 13,875 100% $81.1 to $150.3 $6

$1

Changes to raw materials g 0 or $90 per thousand square feet (msf) of product produced 107,482 msf switching resins and 184,023 msf switching platforms 51% $14.3 $1Keep additional records i,j Non-employer firms: $3,711 to $3,890 Employer firms: $3,711 to $16,628 4,371 to 8,102 non-emp 3,115 to 5,773 employer 100% $32.3 to $59.8 $32

$5

Fabricators that are not laminators

All fabricators that are not laminators

66,103 to 72,492 entities

Become familiar with the TSCA rule k $294 - - - 66,103 to 72,492 100% $19.5 to $21.3 - Set-up to label products as TSCA compliant k, l

$133 

or 

$4,552

- - -

64,290 minor cost; 

1,813 to 8,202 more 

substantive cost

100% $16.8 to $45.9 - 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-171 

Table 2-90: Option SI: Activities with Cost Estimates, by Type of Entity and Baseline Status, Incremental to the CARB ATCM

Type of 

Entity

Baseline Status under 

CARB ATCM a

Number of 

Entities or 

Production 

Volume b

Activities with Incremental Costs 

Estimated

Average Incremental Cost per Entity c Number of Entities or 

Production Volume 

Incurring Non-Zero 

Costs

Percent 

Incurring Non-Zero 

Costs

Total Cost (mil

2010$)

Initial Start-up 

or First Year Costs

Annual Recurring 

Costs in 

Subsequent Years

First 

Year

Subse

Ye

Fabricators not compliant with CARBATCM requirements 

33,665 to 40,054 entities

Supplier Notification $343 - - - 33,665 to 40,054 100% $11.5 to $13.7 - Keep additional records j, k

Non-employer firms: 0 or $179 

Employer firms: 0 or $12,917

2,163 to 2,573 nonemployers; 1,541 to 

1,833 employers

11% $20.3 to $24.1 $20

$2

Wholesalers 

All wholesalers 85,560 entities

Become familiar with the TSCA rule $373 - - - 85,560 100% $31.9 - If repackaging or replacing an original label, set-up to label products as TSCA compliant

$4,552 - - - 855 1% $3.9 - 

Wholesalers that are not compliant with CARB ATCM 

53,731entities m

Supplier Notification $345 53,731 100% $18.5 - Set up systems to keep additional records n 0 or $2,511 - - - 30,629 57% $76.9 - Keep additional records o Non-employer firms: 0 or $100 Employer firms: 0 or $4,980 13,666 non-employers; 9,436 employer 43% $48.4 $4

Retailers

All retailers 759,048entities Become familiar with the TSCA rule $283 - - - 759,048 100% $214.7 - Retailers that are not compliant with CARB ATCM

658,150 entities Supplier Notification $75 - - - 658,150 100% $49.1 - 

Total Rule Cost

$919.4 

to 

$1254.3

$177

$2

a Categories designated as “All” entities (e.g., All Panel Manufacturers, All Wholesalers, etc.) apply to all entities in the U.S. selling composite wood products, including both entities that compwith the CARB ATCM and those that do not. For each industry, the various sub-categories in the baseline status column (such as entities not compliant with the CARB ATCM) are subsets of t“All” entity categories. Some products are not certified under the CARB ATCM in the baseline because they are not sold in California, and some firms are not compliant with the labeling and recordkeeping requirements in the CARB ATCM because their products are not intended for sale in California. b Estimated number of entities reflects those entities selling composite wood products or goods containing regulated composite wood products. Production volume is only listed for entities wicost estimated for a change in raw materials, in which case it is reported in thousand square feet (msf) of product produced. c Reported values represent average incremental costs, which characterize a population where some entities incur costs below average and others incur costs that are above average. For activitiwith a single value reported spanning both cost columns, entities are estimated to incur the same average annual cost in the first year and in subsequent years. For changes to raw materials, the cost is based on the production volume affected rather than the number of entities affected.d Panel producers with a standard certification or a new NAF certification are assumed to conduct daily on-site quality control testing in order to comply with the proposed requirement that testlots must be held until test results indicate that the emissions standard has been met. Particleboard and MDF manufacturers are assumed to be conducting daily on-site quality control testing to comply with the CARB ATCM, and do not incur incremental costs for this activity. Hardwood plywood producers with an existing ULEF or NAF certification will already have been exemptefrom quality control testing. Hardwood plywood manufacturers with a standard certification are assumed to send panels to an off-site lab for quality control testing in the baseline, and thus wou
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-172 

Table 2-90: Option SI: Activities with Cost Estimates, by Type of Entity and Baseline Status, Incremental to the CARB ATCM

Type of 

Entity

Baseline Status under 

CARB ATCM a

Number of 

Entities or 

Production 

Volume b

Activities with Incremental Costs 

Estimated

Average Incremental Cost per Entity c Number of Entities or 

Production Volume 

Incurring Non-Zero 

Costs

Percent 

Incurring Non-Zero 

Costs

Total Cost (mil

2010$)

Initial Start-up 

or First Year Costs

Annual Recurring 

Costs in 

Subsequent Years

First 

Year

Subse

Ye

incur incremental costs to conduct daily on-site testing. Hardwood plywood manufacturers with a new NAF certification are assumed to conduct daily on-site quality control testing for the first months. Laminators defined as hardwood plywood manufacturers do not perform testing in the baseline, and thus would also incur costs for on-site daily quality control testing.e Incremental testing costs depend on several factors including the type of composite wood product, the number of products certified, the baseline CARB ATCM certification level (Phase 2, ULor NAF), and the TSCA certification level. Elsewhere in the report testing and certification costs are reported as the sum of this value and the cost of on-site daily quality control testing.f Estimated raw materials costs vary with the type of composite wood product, the resin used in the baseline, and the composition of the core or platform used for hardwood plywood in the baseOf the estimated 4.6 million square feet (mmsf) of hardwood plywood that is not certified under the CARB ATCM, producers are estimated to incur incremental costs of $50/msf (3/8” basis) fochanges to resin system for 2.3 mmsf (and additional costs of $60/msf for switching to low emission cores for a fraction of that production volume). The remaining hardwood plywood productvolume is not estimated to need to make raw materials changes because it meets the emission standard in the baseline. All MDF production is estimated to comply with the emission standards baseline, so MDF producers are not expected to make raw materials changes. Particleboard producers are estimated to incur incremental costs of $20/msf (3/4” basis) for raw materials changes all the 45 mmsf of production volume that is not certified under the CARB ATCM in the baseline. The remaining particleboard production is not estimated to make raw materials changes becameets the emission standard in the baseline. Thus, of the 49.6 mmsf of composite wood manufactured by stock panel producers that is not certified under the CARB ATCM, 47.3 mmsf (95%) estimated to change raw materials.g For products made by laminators (and thus are defined as hardwood plywood producers under Option SI), 30% of the production volume is assumed to incur costs of $30/msf (5/8” basis) to mchanges to resin systems in order to meet the emissions standards and 51% of the production volume is assumed to incur costs of $60/msf (5/8” basis) to switch to lower emission platforms in oto meet the emissions standards. Some production is assumed to meet the emission standard in the baseline and does not incur costs for raw materials changes.h Under Option SI all laminators are defined as hardwood plywood producers, so they must have their products tested and certified by a TPC and meet the hardwood plywood emissions standari To simplify the cost calculations, recordkeeping costs for this group are calculated assuming that none of these entities are compliant with the CARB ATCM in the baseline. j Based on conversations with fabricators complying with the CARB ATCM, 11% of all fabricators (including laminators) that are not already complying with the CARB ATCM are assumed to incur additional recurring recordkeeping costs averaging $12,917 for employer firms and $179 for non-employer firms to comply with the recordkeeping requirements in the TSCA rule (althourecurring recordkeeping costs for these entities are assumed to be a function of firm size as measured by revenues). As a simplification, the analysis assumes that all laminators incur these costthat fewer than 11% of fabricators that are not laminators do so. The result is that 11% of all fabricators (which represents the combination of fabricators and laminators that are not fabricators) assumed to incur recurring recordkeeping costs. k There are 79,978 fabricators, which can be categorized as laminators or as fabricators that are not laminators. Total costs depend on how many entities are in each group. The higher estimate the number of laminators corresponds to the lower estimate for the number of fabricators that are not laminators, so total costs can vary inversely between the two groups. Thus, when adding arows together to yield the Total Rule Cost in the final row of this table, the order of the Total Cost ranges for this row must be reversed (i.e., the high value in this range is used to calculate the lvalue for the Total Rule Cost, and the low value in this range is used to calculate the high value for the Total Rule Cost).l Based on conversations with fabricators complying with the CARB ATCM, all firms that are complying with the CARB ATCM and 67% of firms that are not already complying with the CARATCM are assumed to incur minor costs for setting up new labels ($133), while 33% of firms that are not already complying with the CARB ATCM are assumed to incur more substantive cost(averaging $4,552) to set up labels.m The analysis estimates that 53,731 wholesalers are not CARB compliant in the baseline.
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-173 

Table 2-90: Option SI: Activities with Cost Estimates, by Type of Entity and Baseline Status, Incremental to the CARB ATCM

Type of 

Entity

Baseline Status under 

CARB ATCM a

Number of 

Entities or 

Production 

Volume b

Activities with Incremental Costs 

Estimated

Average Incremental Cost per Entity c Number of Entities or 

Production Volume 

Incurring Non-Zero 

Costs

Percent 

Incurring Non-Zero 

Costs

Total Cost (mil

2010$)

Initial Start-up 

or First Year Costs

Annual Recurring 

Costs in 

Subsequent Years

First 

Year

Subse

Ye

n Under Option SI, firms must keep additional records equivalent to those required by the CARB ATCM. However, firms that are compliant with the CARB ATCM will already be keeping sufficient records to comply with the requirements. In conversations with entities complying with the CARB ATCM, 57% of wholesalers reported incurring average costs of $2,511 to set up recordkeeping systems to comply with the rule. (Fabricators and retailers did not report incurring such costs.) So 57% of the wholesalers and are not compliant with the CARB ATCM are estimto incur costs averaging $2,511 to update their recordkeeping systems to comply with Option SI. The existing recordkeeping systems at the remaining wholesalers, as well as at panel manufactlaminators, and fabricators, are assumed to be sufficient to comply with the TSCA rule.o Based on conversations with wholesalers complying with the CARB ATCM, 43% of wholesalers that are not already complying with the CARB ATCM are assumed to incur additional recurrrecordkeeping costs. They are estimated to incur costs averaging $4,890 per firm for employer firms and $100 for non-employer firms to comply with Option SI (although recurring recordkeepcosts for these entities are assumed to be a function of firm size as measured by revenues). The remaining wholesalers are not estimated to incur these recordkeeping costs because their existinrecords are sufficient to comply with the rule’s requirements. 

2913 2914 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-174 

2915 

Table 2-91: Option SCR: Activities with Cost Estimates, by Type of Entity and Baseline Status, Incremental to the CARB ATCM

Type of 

Entity

Baseline Status under 

CARB ATCM a

Number of 

Entities or 

Production 

Volume b

Activities with Incremental Costs 

Estimated

Average Incremental Cost per Entity c Number of Entities or 

Production Volume 

Incurring Non-Zero 

Costs

Percent 

Incurring Non-Zero 

Costs

Total Cost (mil

2010$)

Initial Start-up 

or First Year Costs

Annual Recurring 

Costs in 

Subsequent Years

First 

Year

Subse

Ye

Panel manufacturers 

All panel manufacturers 62 entities

Become familiar with TSCA rule $294 - - - 62 100% $0.02 - On-site daily quality control testing d 0 or $10,832 0 or $832 34 55% $0.4 $0Set-up to label products as TSCA compliant $149 - - - 62 100% $0.009 - Keep additional records $3,711 62 100% $0.2 $

Manufacture products not certified under CARB ATCM 

16 entities and 

49.6 msf of 

production

Have products tested and certified by a TPC e $5,185 to $31,183 $2,365 to $6,230 16 100% $0.4 $0Changes to raw materials f 0 or $20 to $110 per thousand square feet (msf) of product produced 47,300 msf 95% $1.1 $

Manufacture products certified as ULEF under CARB ATCM

17 entities Have products tested and certified as Phase 2 or NAF by a TPC e $12,312 to $51,292 ($2,790) to $51,292 17 100% $0.6 $

Wood veneer laminated product manufacturers

All laminators 7,486 to 13,875 entities Become familiar with the TSCA rule $294 - - - 7,486 to 13,875 100% $2.2 to $4.1 - 

Set-up to label products as TSCA compliant $4,552 - - - 7,486 to 13,875 100% $34.1 to $63.2 - 

Laminators defined as hardwood plywood producers under TSCA

150 to 277 

entities and 7,248 

msf of 

production

Have products tested and certified by a TPC e $61,676 to $70,782 $55,690 to $61,950 150 to 277 100% $9.3 to $19.6 $8

$1

On-site daily quality control testing d $10,832 $832 150 to 277 100% $1.6 to $3.0 $0.1 tChanges to raw materials g 0 or $30 per thousand square feet (msf) of product produced 2,149 msf 30% $0.06 $0Keep additional records Non-employer firms: $3,890 Employer firms: $16,628 88 to 162 non-emp 62 to 115 employer 100% $1.4 to $2.5 $1.4 t

Laminators defined as fabricators under TSCA

7,336 to 13,598 

entities and 

355,164 msf

Changes to raw materials h 0 or $30 per thousand square feet (msf) of product produced 105,317 msf 30% $3.2 $

Laminators defined as fabricators; not compliant with CARB ATCM requirements for fabricators 

7,336 to 13,598 

entities i Keep additional records j

Non-employer firms: 0 or $179

Employer firms: 0 or $12,917

394 to 729 nonemployers

280 to 520 employer

9% $3.7 to $6.8 $3.7 t

Fabricators that are not 

All fabricators that are not laminators

66,103 to 72,492 

entities

Become familiar with the TSCA rule k $294 - - - 66,103 to 72,492 100% $19.5 to $21.3 - 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-175 

Table 2-91: Option SCR: Activities with Cost Estimates, by Type of Entity and Baseline Status, Incremental to the CARB ATCM

Type of 

Entity

Baseline Status under 

CARB ATCM a

Number of 

Entities or 

Production 

Volume b

Activities with Incremental Costs 

Estimated

Average Incremental Cost per Entity c Number of Entities or 

Production Volume 

Incurring Non-Zero 

Costs

Percent 

Incurring Non-Zero 

Costs

Total Cost (mil

2010$)

Initial Start-up 

or First Year Costs

Annual Recurring 

Costs in 

Subsequent Years

First 

Year

Subse

Ye

laminators Set-up to label products as TSCA 

compliant k, l

$133 

or 

$4,552

- - -

64,290 minor cost; 

1,813 to 8,202 more 

substantive cost

100% $16.8 to $45.9 - 

Fabricators not compliant with CARB ATCM requirements 

33,665 to 40,054 

entities Keep additional records j, k

Non-employer firms: 0 or $179 

Employer firms: 0 or $12,917

2,163 to 2,573 nonemployers; 1,541 to 

1,833 employers

11% $20.3 to $24.1 $20

$2

Wholesalers 

All wholesalers 85,560 entities

Become familiar with the TSCA rule $373 - - - 85,560 100% $31.9 - If repackaging or replacing an original label, set-up to label products as TSCA compliant

$4,552 - - - 855 1% $3.9 - 

Wholesalers that import and are not compliant with CARB ATCM 

15,045 entities m

Set up systems to keep additional records n 0 or $2,511 - - - 8,576 57% $21.5 - Keep additional records o Non-employer firms: 0 or $100 Employer firms: 0 or $4,980 3,826 non-employers; 2,642 employer 43% $13.5 $1

Retailers All retailers 759,048 entities Become familiar with the TSCA rule $283 - - - 759,048 100% $214.7 - Total Rule Cost $435 to $447 $56 ta Categories designated as “All” entities (e.g., All Panel Manufacturers, All Wholesalers, etc.) apply to all entities in the U.S. selling composite wood products, including both entities that compwith the CARB ATCM and those that do not. For each industry, the various sub-categories in the baseline status column (such as entities not compliant with the CARB ATCM) are subsets of t“All” entity categories. Some products are not certified under the CARB ATCM in the baseline because they are not sold in California, and some firms are not compliant with the labeling and recordkeeping requirements in the CARB ATCM because their products are not intended for sale in California. b Estimated number of entities reflects those entities selling composite wood products or goods containing regulated composite wood products. Production volume is only listed for entities with cost estimated for a change in raw materials, in which case it is reported in thousand square feet (msf) of product produced. c Reported values represent average incremental costs, which characterize a population where some entities incur costs below average and others incur costs that are above average. For activitiwith a single value reported spanning both cost columns, entities are estimated to incur the same average annual cost in the first year and in subsequent years. For changes to raw materials, the cost is based on the production volume affected rather than the number of entities affected.d Panel producers with a standard certification or a new NAF certification are assumed to conduct daily on-site quality control testing in order to comply with the proposed requirement that testlots must be held until test results indicate that the emissions standard has been met. Particleboard and MDF manufacturers are assumed to be conducting daily on-site quality control testing to comply with the CARB ATCM, and do not incur incremental costs for this activity. Hardwood plywood producers with an existing ULEF or NAF certification will already have been exemptefrom quality control testing. Hardwood plywood manufacturers with a standard certification are assumed to send panels to an off-site lab for quality control testing in the baseline, and thus wouincur incremental costs to conduct daily on-site testing. Hardwood plywood manufacturers with a new NAF certification are assumed to conduct daily on-site quality control testing for the first months. Laminators defined as hardwood plywood manufacturers do not perform testing in the baseline, and thus would also incur costs for on-site daily quality control testing.e Incremental testing costs depend on several factors including the type of composite wood product, the number of products certified, the baseline CARB ATCM certification level (Phase 2, ULor NAF), and the TSCA certification level. Elsewhere in the report testing and certification costs are reported as the sum of this value and the cost of on-site daily quality control testing.
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-176 

Table 2-91: Option SCR: Activities with Cost Estimates, by Type of Entity and Baseline Status, Incremental to the CARB ATCM

Type of 

Entity

Baseline Status under 

CARB ATCM a

Number of 

Entities or 

Production 

Volume b

Activities with Incremental Costs 

Estimated

Average Incremental Cost per Entity c Number of Entities or 

Production Volume 

Incurring Non-Zero 

Costs

Percent 

Incurring Non-Zero 

Costs

Total Cost (mil

2010$)

Initial Start-up 

or First Year Costs

Annual Recurring 

Costs in 

Subsequent Years

First 

Year

Subse

Ye

f Estimated raw materials costs vary with the type of composite wood product, the resin used in the baseline, and the composition of the core or platform used for hardwood plywood in the baseOf the estimated 4.6 million square feet (mmsf) of hardwood plywood that is not certified under the CARB ATCM, producers are estimated to incur incremental costs of $50/msf (3/8” basis) fochanges to resin system for 2.3 mmsf (and additional costs of $60/msf for switching to low emission cores for a fraction of that production volume). The remaining hardwood plywood productvolume is not estimated to need to make raw materials changes because it meets the emission standard in the baseline. All MDF production is estimated to comply with the emission standards baseline, so MDF producers are not expected to make raw materials changes. Particleboard producers are estimated to incur incremental costs of $20/msf (3/4” basis) for raw materials changes all the 45 mmsf of production volume that is not certified under the CARB ATCM in the baseline. The remaining particleboard production is not estimated to make raw materials changes becameets the emission standard in the baseline. Thus, of the 49.6 mmsf of composite wood produced by stock panel producers that is not certified under the CARB ATCM, 47.3 mmsf (95%) is estimated to change raw materials.g For products made by laminators that continue to use added formaldehyde resins (and thus are defined as hardwood plywood producers under TSCA), 30% of the production volume is assumincur costs of $30/msf (5/8” basis) to make changes to resin systems in order to meet the emissions standards. The remaining production is assumed to meet the emission standard in the baselindoes not incur costs for raw materials changes.h Laminators defined as fabricators are estimated to incur costs of $30/msf (5/8” basis) to switch to NAF resins for approximately 30% of the production volume of laminated products. The remaining production uses NAF resins in the baseline (and does not incur costs for raw material changes), or continues using added formaldehyde resin and thus is defined as hardwood plywoounder TSCA (addressed in a prior row in the table). i To simplify the cost calculations, recordkeeping costs for this group are calculated assuming that none of these entities are compliant with the CARB ATCM in the baseline. j Based on conversations with fabricators complying with the CARB ATCM, 11% of all fabricators (including laminators) that are not already complying with the CARB ATCM are assumed to incur additional recurring recordkeeping costs averaging $12,917 for employer firms and $179 for non-employer firms to comply with the recordkeeping requirements in the TSCA rule (althourecurring recordkeeping costs for these entities are assumed to be a function of firm size as measured by revenues). The analysis estimates that 11% of laminators overall (combined for both thdefined as hardwood plywood producers and those defined as fabricators) incur these costs. All the laminators defined as hardwood plywood producers are assumed to incur these additional recordkeeping costs. Thus, the remainder of the 11% of laminators incurring the additional recordkeeping costs are laminators defined as fabricators. For example, the low estimate for the numof laminators is 7,486. The number of laminators incurring additional recordkeeping costs is 824 (824≈11%*7,846). All 150 laminators defined as hardwood plywood producers are assumed tincur the additional recordkeeping costs. Thus, the remaining 674 (674=824-150) laminators incurring additional recordkeeping costs are laminators defined as fabricators, of which 394 are noemployer firms and 280 are employer firms. And the 674 firms is 9% of the 7,336 total firms in this category.k Total costs for laminators and fabricators depend on how many entities are in each group. When more laminators are defined as hardwood plywood producers fewer are defined as fabricatorstotal costs can vary inversely between the two groups. Thus, when adding all the rows together to yield the Total Rule Cost in the final row of this table, the order of the Total Cost ranges for throw must be reversed (i.e., the high value in this range is used to calculate the low value for the Total Rule Cost, and the low value in this range is used to calculate the high value for the Total RCost).l Based on conversations with fabricators complying with the CARB ATCM, all firms that are complying with the CARB ATCM and 67% of firms that are not already complying with the CARATCM are assumed to incur minor costs for setting up new labels ($133), while 33% of firms that are not already complying with the CARB ATCM are assumed to incur more substantive cost(averaging $4,552) to set up labels.m The analysis estimates that 53,731 wholesalers are not CARB compliant in the baseline, and that 28% of wholesalers are importers. Combining these yields an estimate that 15,045 wholesale
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-177 

Table 2-91: Option SCR: Activities with Cost Estimates, by Type of Entity and Baseline Status, Incremental to the CARB ATCM

Type of 

Entity

Baseline Status under 

CARB ATCM a

Number of 

Entities or 

Production 

Volume b

Activities with Incremental Costs 

Estimated

Average Incremental Cost per Entity c Number of Entities or 

Production Volume 

Incurring Non-Zero 

Costs

Percent 

Incurring Non-Zero 

Costs

Total Cost (mil

2010$)

Initial Start-up 

or First Year Costs

Annual Recurring 

Costs in 

Subsequent Years

First 

Year

Subse

Ye

import and are not CARB compliant. n Under the TSCA rule, wholesalers and retailers that do not import products are only required to keep invoices and bills of lading. These records are already kept as part of ordinary business practices, so there are no incremental recordkeeping costs estimated for these entities. Firms that import must keep additional records beyond invoices and bills of lading under the TSCA rule. However, firms that are compliant with the CARB ATCM will already be keeping sufficient records to comply with the TSCA requirements for importers. In conversations with entities complwith the CARB ATCM, 57% of wholesalers reported incurring average costs of $2,511 to set up recordkeeping systems to comply with the rule. (Fabricators and retailers did not report incurrisuch costs.) So 57% of the 15,045 wholesalers that import and are not compliant with the CARB ATCM (or 8,576 wholesalers) are estimated to incur costs averaging $2,511 to update their recordkeeping systems to comply with the TSCA rule. The existing recordkeeping systems at the remaining wholesalers that import, as well as at panel manufacturers, laminators, and fabricatoare assumed to be sufficient to comply with the TSCA rule.o Based on conversations with wholesalers complying with the CARB ATCM, 43% of 15,045 wholesalers that import and are not already complying with the CARB ATCM are assumed to incadditional recurring recordkeeping costs. They are estimated to incur costs averaging $4,890 per firm for the 2,642 employer firms and $100 for the 3,826 non-employer firms to comply with tTSCA rule (although recurring recordkeeping costs for these entities are assumed to be a function of firm size as measured by revenues). The remaining wholesalers are not estimated to incur trecordkeeping costs because their existing records are sufficient to comply with the rule’s requirements. 

2916 2917 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-178 

2918 

Table 2-92: Option SEUR: Activities with Cost Estimates, by Type of Entity and Baseline Status, Incremental to the CARB ATCM

Type of 

Entity

Baseline Status under 

CARB ATCM a

Number of 

Entities or 

Production 

Volume b

Activities with Incremental Costs 

Estimated

Average Incremental Cost per Entity c Number of Entities or 

Production Volume

Incurring Non-Zero 

Costs

Percent 

Incurring Non-Zero 

Costs

Total Cost (mil

2010$)

Initial Start-up 

or First Year Costs

Annual Recurring 

Costs in 

Subsequent Years

First 

Year

Subse

Ye

Panel manufacturers 

All panel manufacturers 62 entities

Become familiar with TSCA rule $294 - - - 62 100% $0.02 - On-site daily quality control testing d 0 or $10,832 0 or $832 21 34% $0.2 $0Set-up to label products as TSCA compliant $149 - - - 62 100% $0.009 - Keep additional records $3,711 62 100% $0.2 $

Manufacture products not certified under CARB ATCM 

16 entities and 

49.6 msf of 

production

Have products tested and certified by a TPC e $5,185 to $31,183 $4,485 to $6,230 16 100% $0.4 $0Changes to raw materials f 0 or $20 to $110 per thousand square feet (msf) of product produced 47,300 msf 95% $1.1 $

Wood veneer laminated product manufacturers

All laminators 7,486 to 13,875 entities g

Become familiar with the TSCA rule $294 - - - 7,486 to 13,875 100% $2.2 to $4.1 - Set-up to label products as TSCA compliant $4,552 - - - 7,486 to 13,875 100% $34.1 to $63.2 - Keep additional records ,h Non-employer firms: 0 or $179 Employer firms: 0 or $12,917 481 to 891 non-emplyr 343 to 635 employer 11% $4.5 to $8.4 $4.5 t

Fabricators that are not laminators

All fabricators that are not laminators

66,103 to 72,492 

entities

Become familiar with the TSCA rule i $294 - - - 66,103 to 72,492 100% $19.5 to $21.3 - Set-up to label products as TSCA compliant i, j

$133 

or 

$4,552

- - -

64,290 minor cost; 

1,813 to 8,202 more 

substantive cost

100% $16.8 to $45.9 - 

Fabricators not compliant with CARB ATCM requirements 

33,665 to 40,054 

entities Keep additional records h, i

Non-employer firms: 0 or $179 

Employer firms: 0 or $12,917

2,163 to 2,573 nonemployers; 1,541 to 

1,833 employers

11% $20.3 to $24.1 $20

$2

Wholesalers 

All wholesalers 85,560 entities

Become familiar with the TSCA rule $373 - - - 85,560 100% $31.9 - If repackaging or replacing an original label, set-up to label products as TSCA compliant

$4,552 - - - 855 1% $3.9 - 

Wholesalers that import and are not compliant with CARB ATCM 

15,045 entities k

Set up systems to keep additional records l 0 or $2,511 - - - 8,576 57% $21.5 - Keep additional records m Non-employer firms: 0 or $100 Employer firms: 0 or $4,980 3,826 non-employers; 2,642 employer 43% $13.5 $1

Retailers All retailers 759,048 entities Become familiar with the TSCA rule $283 - - - 759,048 100% $214.7 - Total Rule Cost $420 $
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-179 

Table 2-92: Option SEUR: Activities with Cost Estimates, by Type of Entity and Baseline Status, Incremental to the CARB ATCM

Type of 

Entity

Baseline Status under 

CARB ATCM a

Number of 

Entities or 

Production 

Volume b

Activities with Incremental Costs 

Estimated

Average Incremental Cost per Entity c Number of Entities or 

Production Volume

Incurring Non-Zero 

Costs

Percent 

Incurring Non-Zero 

Costs

Total Cost (mil

2010$)

Initial Start-up 

or First Year Costs

Annual Recurring 

Costs in 

Subsequent Years

First 

Year

Subse

Ye

a Categories designated as “All” entities (e.g., All Panel Manufacturers, All Wholesalers, etc.) apply to all entities in the U.S. selling composite wood products, including both entities that compwith the CARB ATCM and those that do not. For each industry, the various sub-categories in the baseline status column (such as entities not compliant with the CARB ATCM) are subsets of t“All” entity categories. Some products are not certified under the CARB ATCM in the baseline because they are not sold in California, and some firms are not compliant with the labeling and recordkeeping requirements in the CARB ATCM because their products are not intended for sale in California. b Estimated number of entities reflects those entities selling composite wood products or goods containing regulated composite wood products. Production volume is only listed for entities with cost estimated for a change in raw materials, in which case it is reported in thousand square feet (msf) of product produced. c Reported values represent average incremental costs, which characterize a population where some entities incur costs below average and others incur costs that are above average. For activitiwith a single value reported spanning both cost columns, entities are estimated to incur the same average annual cost in the first year and in subsequent years. For changes to raw materials, the cost is based on the production volume affected rather than the number of entities affected.d Panel producers with a standard certification or a new NAF certification are assumed to conduct daily on-site quality control testing in order to comply with the proposed requirement that testlots must be held until test results indicate that the emissions standard has been met. Particleboard and MDF manufacturers are assumed to be conducting daily on-site quality control testing to comply with the CARB ATCM, and do not incur incremental costs for this activity. Hardwood plywood producers with an existing ULEF or NAF certification will already have been exemptefrom quality control testing. Hardwood plywood manufacturers with a standard certification are assumed to send panels to an off-site lab for quality control testing in the baseline, and thus wouincur incremental costs to conduct daily on-site testing. Hardwood plywood manufacturers with a new NAF certification are assumed to conduct daily on-site quality control testing for the first months. Laminators defined as hardwood plywood manufacturers do not perform testing in the baseline, and thus would also incur costs for on-site daily quality control testing.e Incremental testing costs depend on several factors including the type of composite wood product, the number of products certified, the baseline CARB ATCM certification level (Phase 2, ULor NAF), and the TSCA certification level. Elsewhere in the report testing and certification costs are reported as the sum of this value and the cost of on-site daily quality control testing.f Estimated raw materials costs vary with the type of composite wood product, the resin used in the baseline, and the composition of the core or platform used for hardwood plywood in the baseOf the estimated 4.6 million square feet (mmsf) of hardwood plywood that is not certified under the CARB ATCM, producers are estimated to incur incremental costs of $50/msf (3/8” basis) fochanges to resin system for 2.3 mmsf (and additional costs of $60/msf for switching to low emission cores for a fraction of that production volume). The remaining hardwood plywood productvolume is not estimated to need to make raw materials changes because it meets the emission standard in the baseline. All MDF production is estimated to comply with the emission standards baseline, so MDF producers are not expected to make raw materials changes. Particleboard producers are estimated to incur incremental costs of $20/msf (3/4” basis) for raw materials changes all the 45 mmsf of production volume that is not certified under the CARB ATCM in the baseline. The remaining particleboard production is not estimated to make raw materials changes becameets the emission standard in the baseline. Thus, of the 49.6 mmsf of composite wood produced by stock panel producers that is not certified under the CARB ATCM, 47.3 mmsf (95%) is estimated to change raw materials.g To simplify the cost calculations, recordkeeping costs for this group are calculated assuming that none of these entities are compliant with the CARB ATCM in the baseline. h Based on conversations with fabricators complying with the CARB ATCM, 11% of all fabricators (including laminators) that are not already complying with the CARB ATCM are assumed tincur additional recurring recordkeeping costs averaging $12,917 for employer firms and $179 for non-employer firms to comply with the recordkeeping requirements in the TSCA rule (althourecurring recordkeeping costs for these entities are assumed to be a function of firm size as measured by revenues). The analysis estimates that 11% of laminators overall (combined for both thdefined as hardwood plywood producers and those defined as fabricators) incur these costs. All the laminators defined as hardwood plywood producers are assumed to incur these additional recordkeeping costs. Thus, the remainder of the 11% of laminators incurring the additional recordkeeping costs are laminators defined as fabricators. For example, the low estimate for the numof laminators is 7,486. The number of laminators incurring additional recordkeeping costs is 824 (824≈11%*7,846). All 150 laminators defined as hardwood plywood producers are assumed t
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-180 

Table 2-92: Option SEUR: Activities with Cost Estimates, by Type of Entity and Baseline Status, Incremental to the CARB ATCM

Type of 

Entity

Baseline Status under 

CARB ATCM a

Number of 

Entities or 

Production 

Volume b

Activities with Incremental Costs 

Estimated

Average Incremental Cost per Entity c Number of Entities or 

Production Volume

Incurring Non-Zero 

Costs

Percent 

Incurring Non-Zero 

Costs

Total Cost (mil

2010$)

Initial Start-up 

or First Year Costs

Annual Recurring 

Costs in 

Subsequent Years

First 

Year

Subse

Ye

incur the additional recordkeeping costs. Thus, the remaining 674 (674=824-150) laminators incurring additional recordkeeping costs are laminators defined as fabricators, of which 394 are noemployer firms and 280 are employer firms. And the 674 firms is 9% of the 7,336 total firms in this category.i Total costs for laminators and fabricators depend on how many entities are in each group. When more laminators are defined as hardwood plywood producers fewer are defined as fabricators, total costs can vary inversely between the two groups. Thus, when adding all the rows together to yield the Total Rule Cost in the final row of this table, the order of the Total Cost ranges for throw must be reversed (i.e., the high value in this range is used to calculate the low value for the Total Rule Cost, and the low value in this range is used to calculate the high value for the Total RCost).j Based on conversations with fabricators complying with the CARB ATCM, all firms that are complying with the CARB ATCM and 67% of firms that are not already complying with the CARATCM are assumed to incur minor costs for setting up new labels ($133), while 33% of firms that are not already complying with the CARB ATCM are assumed to incur more substantive cost(averaging $4,552) to set up labels.k The analysis estimates that 53,731 wholesalers are not CARB compliant in the baseline, and that 28% of wholesalers are importers. Combining these yields an estimate that 15,045 wholesaleimport and are not CARB compliant. l Under the TSCA rule, wholesalers and retailers that do not import products are only required to keep invoices and bills of lading. These records are already kept as part of ordinary business practices, so there are no incremental recordkeeping costs estimated for these entities. Firms that import must keep additional records beyond invoices and bills of lading under the TSCA rule. However, firms that are compliant with the CARB ATCM will already be keeping sufficient records to comply with the TSCA requirements for importers. In conversations with entities complwith the CARB ATCM, 57% of wholesalers reported incurring average costs of $2,511 to set up recordkeeping systems to comply with the rule. (Fabricators and retailers did not report incurrisuch costs.) So 57% of the 15,045 wholesalers that import and are not compliant with the CARB ATCM (or 8,576 wholesalers) are estimated to incur costs averaging $2,511 to update their recordkeeping systems to comply with the TSCA rule. The existing recordkeeping systems at the remaining wholesalers that import, as well as at panel manufacturers, laminators, and fabricatoare assumed to be sufficient to comply with the TSCA rule.m Based on conversations with wholesalers complying with the CARB ATCM, 43% of 15,045 wholesalers that import and are not already complying with the CARB ATCM are assumed to incadditional recurring recordkeeping costs. They are estimated to incur costs averaging $4,890 per firm for the 2,642 employer firms and $100 for the 3,826 non-employer firms to comply with tTSCA rule (although recurring recordkeeping costs for these entities are assumed to be a function of firm size as measured by revenues). The remaining wholesalers are not estimated to incur trecordkeeping costs because their existing records are sufficient to comply with the rule’s requirements. 

2919 2920 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-181 

2921 

Table 2-93: Option SCUR (Proposed Rule): Activities with Cost Estimates, by Type of Entity and Baseline Status, Incremental to the CARB ATCM

Type of 

Entity

Baseline Status under 

CARB ATCM a

Number of 

Entities or 

Production 

Volume b

Activities with Incremental Costs 

Estimated

Average Incremental Cost per Entity c Number of Entities or 

Production Volume 

Incurring Non-Zero 

Costs

Percent 

Incurring Non-Zero 

Costs

Total Cost (mil

2010$)

Initial Start-up 

or First Year Costs

Annual Recurring 

Costs in 

Subsequent Years

First 

Year

Subse

Ye

Panel manufacturers 

All panel manufacturers 62 entities

Become familiar with TSCA rule $294 - - - 62 100% $0.02 - On-site daily quality control testing d 0 or $10,832 0 or $832 21 34% $0.2 $0Set-up to label products as TSCA compliant $149 - - - 62 100% $0.009 - Keep additional records $3,711 62 100% $0.2 $

Manufacture products not certified under CARB ATCM 

16 entities and 

49.6 msf of 

production

Have products tested and certified by a TPC e $5,185 to $31,183 $4,485 to $6,230 16 100% $0.4 $0Changes to raw materials f 0 or $20 to $110 per thousand square feet (msf) of product produced 47,300 msf 95% $1.1 $

Wood veneer laminated product manufacturers

All laminators 7,486 to 13,875 entities Become familiar with the TSCA rule $294 - - - 7,486 to 13,875 100% $2.2 to $4.1 - 

Set-up to label products as TSCA compliant $4,552 - - - 7,486 to 13,875 100% $34.1 to $63.2 - 

Laminators defined as hardwood plywood producers under TSCA

150 to 277 

entities and 7,248 

msf of 

production

Have products tested and certified by a TPC e $61,676 to $70,782 $55,690 to $61,950 150 to 277 100% $9.3 to $19.6 $8

$1

On-site daily quality control testing d $10,832 $832 150 to 277 100% $1.6 to $3.0 $0.1 tChanges to raw materials g 0 or $30 per thousand square feet (msf) of product produced 2,149 msf 30% $0.06 $0Keep additional records Non-employer firms: $3,890 Employer firms: $16,628 88 to 162 non-emp 62 to 115 employer 100% $1.4 to $2.5 $1.4 t

Laminators defined as fabricators under TSCA

7,336 to 13,598 

entities and 

355,164 msf

Changes to raw materials h 0 or $30 per thousand square feet (msf) of product produced 105,317 msf 30% $3.2 $

Laminators defined as fabricators; not compliant with CARB ATCM requirements for fabricators 

7,336 to 13,598 

entities i Keep additional records j

Non-employer firms: 0 or $179

Employer firms: 0 or $12,917

394 to 729 nonemployers

280 to 520 employer

9% $3.7 to $6.8 $3.7 t

Fabricators that are not laminators

All fabricators that are not laminators

66,103 to 72,492 

entities

Become familiar with the TSCA rule k $294 - - - 66,103 to 72,492 100% $19.5 to $21.3 - Set-up to label products as TSCA compliant k, l

$133 

or 

$4,552

- - -

64,290 minor cost; 

1,813 to 8,202 more 

substantive cost

100% $16.8 to $45.9 - 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-182 

Table 2-93: Option SCUR (Proposed Rule): Activities with Cost Estimates, by Type of Entity and Baseline Status, Incremental to the CARB ATCM

Type of 

Entity

Baseline Status under 

CARB ATCM a

Number of 

Entities or 

Production 

Volume b

Activities with Incremental Costs 

Estimated

Average Incremental Cost per Entity c Number of Entities or 

Production Volume 

Incurring Non-Zero 

Costs

Percent 

Incurring Non-Zero 

Costs

Total Cost (mil

2010$)

Initial Start-up 

or First Year Costs

Annual Recurring 

Costs in 

Subsequent Years

First 

Year

Subse

Ye

Fabricators not compliant with CARB ATCM requirements 

33,665 to 40,054 

entities Keep additional records j, k

Non-employer firms: 0 or $179 

Employer firms: 0 or $12,917

2,163 to 2,573 nonemployers; 1,541 to 

1,833 employers

11% $20.3 to $24.1 $20

$2

Wholesalers 

All wholesalers 85,560 entities

Become familiar with the TSCA rule $373 - - - 85,560 100% $31.9 - If repackaging or replacing an original label, set-up to label products as TSCA compliant

$4,552 - - - 855 1% $3.9 - 

Wholesalers that import and are not compliant with CARB ATCM 

15,045 entities m

Set up systems to keep additional records n 0 or $2,511 - - - 8,576 57% $21.5 - Keep additional records o Non-employer firms: 0 or $100 Employer firms: 0 or $4,980 3,826 non-employers; 2,642 employer 43% $13.5 $1

Retailers All retailers 759,048 entities Become familiar with the TSCA rule $283 - - - 759,048 100% $214.7 - Total Rule Cost $434 to $447 $56 ta Categories designated as “All” entities (e.g., All Panel Manufacturers, All Wholesalers, etc.) apply to all entities in the U.S. selling composite wood products, including both entities that compwith the CARB ATCM and those that do not. For each industry, the various sub-categories in the baseline status column (such as entities not compliant with the CARB ATCM) are subsets of t“All” entity categories. Some products are not certified under the CARB ATCM in the baseline because they are not sold in California, and some firms are not compliant with the labeling and recordkeeping requirements in the CARB ATCM because their products are not intended for sale in California. b Estimated number of entities reflects those entities selling composite wood products or goods containing regulated composite wood products. Production volume is only listed for entities with cost estimated for a change in raw materials, in which case it is reported in thousand square feet (msf) of product produced. c Reported values represent average incremental costs, which characterize a population where some entities incur costs below average and others incur costs that are above average. For activitiwith a single value reported spanning both cost columns, entities are estimated to incur the same average annual cost in the first year and in subsequent years. For changes to raw materials, the cost is based on the production volume affected rather than the number of entities affected.d Panel producers with a standard certification or a new NAF certification are assumed to conduct daily on-site quality control testing in order to comply with the proposed requirement that testlots must be held until test results indicate that the emissions standard has been met. Particleboard and MDF manufacturers are assumed to be conducting daily on-site quality control testing to comply with the CARB ATCM, and do not incur incremental costs for this activity. Hardwood plywood producers with an existing ULEF or NAF certification will already have been exemptefrom quality control testing. Hardwood plywood manufacturers with a standard certification are assumed to send panels to an off-site lab for quality control testing in the baseline, and thus wouincur incremental costs to conduct daily on-site testing. Hardwood plywood manufacturers with a new NAF certification are assumed to conduct daily on-site quality control testing for the first months. Laminators defined as hardwood plywood manufacturers do not perform testing in the baseline, and thus would also incur costs for on-site daily quality control testing.e Incremental testing costs depend on several factors including the type of composite wood product, the number of products certified, the baseline CARB ATCM certification level (Phase 2, ULor NAF), and the TSCA certification level. Elsewhere in the report testing and certification costs are reported as the sum of this value and the cost of on-site daily quality control testing.f Estimated raw materials costs vary with the type of composite wood product, the resin used in the baseline, and the composition of the core or platform used for hardwood plywood in the baseOf the estimated 4.6 million square feet (mmsf) of hardwood plywood that is not certified under the CARB ATCM, producers are estimated to incur incremental costs of $50/msf (3/8” basis) fo
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 2-183 

Table 2-93: Option SCUR (Proposed Rule): Activities with Cost Estimates, by Type of Entity and Baseline Status, Incremental to the CARB ATCM

Type of 

Entity

Baseline Status under 

CARB ATCM a

Number of 

Entities or 

Production 

Volume b

Activities with Incremental Costs 

Estimated

Average Incremental Cost per Entity c Number of Entities or 

Production Volume 

Incurring Non-Zero 

Costs

Percent 

Incurring Non-Zero 

Costs

Total Cost (mil

2010$)

Initial Start-up 

or First Year Costs

Annual Recurring 

Costs in 

Subsequent Years

First 

Year

Subse

Ye

changes to resin system for 2.3 mmsf (and additional costs of $60/msf for switching to low emission cores for a fraction of that production volume). The remaining hardwood plywood productvolume is not estimated to need to make raw materials changes because it meets the emission standard in the baseline. All MDF production is estimated to comply with the emission standards baseline, so MDF producers are not expected to make raw materials changes. Particleboard producers are estimated to incur incremental costs of $20/msf (3/4” basis) for raw materials changes all the 45 mmsf of production volume that is not certified under the CARB ATCM in the baseline. The remaining particleboard production is not estimated to make raw materials changes becameets the emission standard in the baseline. Thus, of the 49.6 mmsf of composite wood produced by stock panel producers that is not certified under the CARB ATCM, 47.3 mmsf (95%) is estimated to change raw materials.g For products made by laminators that continue to use added formaldehyde resins (and thus are defined as hardwood plywood producers under TSCA), 30% of the production volume is assumincur costs of $30/msf (5/8” basis) to make changes to resin systems in order to meet the emissions standards. The remaining production is assumed to meet the emission standard in the baselindoes not incur costs for raw materials changes.h Laminators defined as fabricators are estimated to incur costs of $30/msf (5/8” basis) to switch to NAF resins for approximately 30% of the production volume of laminated products. The remaining production uses NAF resins in the baseline (and does not incur costs for raw material changes), or continues using added formaldehyde resin and thus is defined as hardwood plywoounder TSCA (addressed in a prior row in the table). i To simplify the cost calculations, recordkeeping costs for this group are calculated assuming that none of these entities are compliant with the CARB ATCM in the baseline. j Based on conversations with fabricators complying with the CARB ATCM, 11% of all fabricators (including laminators) that are not already complying with the CARB ATCM are assumed to incur additional recurring recordkeeping costs averaging $12,917 for employer firms and $179 for non-employer firms to comply with the recordkeeping requirements in the TSCA rule (althourecurring recordkeeping costs for these entities are assumed to be a function of firm size as measured by revenues). The analysis estimates that 11% of laminators overall (combined for both thdefined as hardwood plywood producers and those defined as fabricators) incur these costs. All the laminators defined as hardwood plywood producers are assumed to incur these additional recordkeeping costs. Thus, the remainder of the 11% of laminators incurring the additional recordkeeping costs are laminators defined as fabricators. For example, the low estimate for the numof laminators is 7,486. The number of laminators incurring additional recordkeeping costs is 824 (824≈11%*7,846). All 150 laminators defined as hardwood plywood producers are assumed tincur the additional recordkeeping costs. Thus, the remaining 674 (674=824-150) laminators incurring additional recordkeeping costs are laminators defined as fabricators, of which 394 are noemployer firms and 280 are employer firms. And the 674 firms is 9% of the 7,336 total firms in this category.k Total costs for laminators and fabricators depend on how many entities are in each group. When more laminators are defined as hardwood plywood producers fewer are defined as fabricatorstotal costs can vary inversely between the two groups. Thus, when adding all the rows together to yield the Total Rule Cost in the final row of this table, the order of the Total Cost ranges for throw must be reversed (i.e., the high value in this range is used to calculate the low value for the Total Rule Cost, and the low value in this range is used to calculate the high value for the Total RCost).l Based on conversations with fabricators complying with the CARB ATCM, all firms that are complying with the CARB ATCM and 67% of firms that are not already complying with the CARATCM are assumed to incur minor costs for setting up new labels ($133), while 33% of firms that are not already complying with the CARB ATCM are assumed to incur more substantive cost(averaging $4,552) to set up labels.m The analysis estimates that 53,731 wholesalers are not CARB compliant in the baseline, and that 28% of wholesalers are importers. Combining these yields an estimate that 15,045 wholesaleimport and are not CARB compliant. n Under the TSCA rule, wholesalers and retailers that do not import products are only required to keep invoices and bills of lading. These records are already kept as part of ordinary business 
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Table 2-93: Option SCUR (Proposed Rule): Activities with Cost Estimates, by Type of Entity and Baseline Status, Incremental to the CARB ATCM

Type of 

Entity

Baseline Status under 

CARB ATCM a

Number of 

Entities or 

Production 

Volume b

Activities with Incremental Costs 

Estimated

Average Incremental Cost per Entity c Number of Entities or 

Production Volume 

Incurring Non-Zero 

Costs

Percent 

Incurring Non-Zero 

Costs

Total Cost (mil

2010$)

Initial Start-up 

or First Year Costs

Annual Recurring 

Costs in 

Subsequent Years

First 

Year

Subse

Ye

practices, so there are no incremental recordkeeping costs estimated for these entities. Firms that import must keep additional records beyond invoices and bills of lading under the TSCA rule. However, firms that are compliant with the CARB ATCM will already be keeping sufficient records to comply with the TSCA requirements for importers. In conversations with entities complwith the CARB ATCM, 57% of wholesalers reported incurring average costs of $2,511 to set up recordkeeping systems to comply with the rule. (Fabricators and retailers did not report incurrisuch costs.) So 57% of the 15,045 wholesalers that import and are not compliant with the CARB ATCM (or 8,576 wholesalers) are estimated to incur costs averaging $2,511 to update their recordkeeping systems to comply with the TSCA rule. The existing recordkeeping systems at the remaining wholesalers that import, as well as at panel manufacturers, laminators, and fabricatoare assumed to be sufficient to comply with the TSCA rule.o Based on conversations with wholesalers complying with the CARB ATCM, 43% of 15,045 wholesalers that import and are not already complying with the CARB ATCM are assumed to incadditional recurring recordkeeping costs. They are estimated to incur costs averaging $4,890 per firm for the 2,642 employer firms and $100 for the 3,826 non-employer firms to comply with tTSCA rule (although recurring recordkeeping costs for these entities are assumed to be a function of firm size as measured by revenues). The remaining wholesalers are not estimated to incur trecordkeeping costs because their existing records are sufficient to comply with the rule’s requirements. 

2922 2923 
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May 1, 2013 3-1 

2924 3 Benefits 

2925 

2926 Evidence for potential health effects associated with formaldehyde exposureexposures at the level 

2927 associated with non-industrial environments is provided by a wide variety of human clinical, 

2928 epidemiology, and animal studies (U.S. EPA 2010c). As is typical for health effects associated with a 

2929 reactive gas, some of these health effects are commonly found at the portal of entry (e.g., sensory 

2930 irritation). Other reported health effects include effects on the nervous and reproductive systems, 

2931 developmental effects, and immunomodulation. 

2932 

2933 The health effects for which benefits are monetized in this economic analysis include: (1)

2934 nasopharyngeal cancer for individuals of all ages, (2) and eye irritation for individuals of all ages, (3) 

2935 asthma in children ages 6 to 17, and (4). The analysis also includes a qualitative discussion of non2936 monetized benefits from avoided respiratory related effects, and benefits from avoiding reduced fertility 

2937 in women ages 20 to 40. 

2938 

2939 The potential benefits of the proposed TSCA Title VI Implementation Rule are estimated for 

2940 several analytical options which are presented in Table 3-1. 

2941 

2942 

2943 

Field Code Changed
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May 1, 2013 3-2 

Table 3-1: Analytical Options Considered in the Benefits Analysis

Analytical Option a Emissions 

Standards 

Notes a

Analytical options with emissions standards at the levels required by TSCA Title VI b

Option SE: Statutory emissions standards 

where wood veneer laminated products are 

exempt from the definition of hardwood 

plywood 

Hardwood plywood MDF 

Thin MDF

ParticleboardLaminators do not need TPC 

testing or certification. No ULEF 

certification. 

0.05 

ppm

0.11 

ppm

0.13 

ppm

0.09 

ppm

Same emissions 

standards as Phase 2 of 

the CARB ATCM. 

Recordkeeping and 

supplier notification 

equivalent to CARB 

ATCM.

Option SI: Statutory 

emissions standards 

where wood veneer 

laminated products are

included in the definition 

of hardwood plywood 

Same as above

Same emissions standards as Phase 2 of the CARB ATCM, with a different 

definition of hardwood plywood. Recordkeeping and supplier notification 

equivalent to CARB ATCM.All laminators must have products tested and 

certified by a TPC. No ULEF certification. 

Option SP: Statutory 

emissions standards 

where wood veneer 

laminated products other 

than Custom and 

Architectural Panel 

products are exempt 

from the definition of 

hardwood plywood 

Same as above

Same emissions standards as Phase 2 of the CARB ATCM, with a different 

definition of hardwood plywood. Recordkeeping and supplier notification 

equivalent to CARB ATCM.Only laminators making Custom or Architectural 

panels must have products tested and certified by a TPC. Laminators making 

other products do not need TPC testing or certification. No ULEF certification. 

Option SN: Statutory 

emissions standards 

where wood veneer 

laminated products made 

using NAF resins to 

attach wood veneers to 

NAF platforms are 

exempt from the 

definition of hardwood 

plywood

Same as above

Same emissions standards as Phase 2 of the CARB ATCM, with a different 

definition of hardwood plywood. Recordkeeping and supplier notification 

equivalent to CARB ATCM.Laminators using NAF resins to attach wood 

veneers to NAF platforms do not need TPC testing and certification. 

Laminators making other products do not need TPC testing or certification. No 

ULEF certification. 

Option SC: Statutory emissions standards 

where wood veneer laminated products 

made with wood veneers attached to 

compliant platforms using no-added 

formaldehyde (NAF) resins are exempt 

from the definition of hardwood plywood

Laminators using NAF resins to attach wood veneers to compliant platforms do 

not need TPC testing and certification. Laminators making other products do 

not need TPC testing or certification. No ULEF certification. 

Option SCSCR: 

Statutory emissions 

standards where wood 

veneer laminated 

products made with 

wood veneers attached 

to compliant platforms 

using no-added 

formaldehyde (NAF)

resins are exempt from 

the definition of 

hardwood plywood. 

Reduced recordkeeping 

requirements for nonmanufacturers compared 

to other options.

Same as above

Same emissions standards as Phase 2 of the CARB ATCM, with a different 

definition of hardwood plywood. Recordkeeping and supplier notification 

equivalent to CARB ATCM.

Laminators using NAF resins to attach wood veneers to compliant platforms do 

not need TPC testing and certification. Laminators making other products do 

not need TPC testing or certification. No ULEF certification. Wholesalers and 

retailers that are not manufacturers under TSCA would only be required to keep 

invoices and bills of lading. No supplier notification required.

Formatted Table

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Deleted Cells

Deleted Cells

Deleted Cells

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May 1, 2013 3-3 

Table 3-1: Analytical Options Considered in the Benefits Analysis

Option SEUR: Statutory emissions 

standards where wood veneer laminated 

products are exempt from the definition of 

hardwood plywood. ULEF certification 

allowed.c Reduced recordkeeping 

requirements for non-manufacturers.

Laminators do not need TPC testing or certification. ULEF certification 

allowed. Wholesalers and retailers that are not manufacturers under TSCA 

would only be required to keep invoices and bills of lading. No supplier 

notification required.

Option SFCC: Statutory emissions 

standards with regulatory provisions that 

are fully consistent with CARB ATCM.

Tested lots may be shipped before test results are available. Laminators do not 

need TPC testing or certification. ULEF certification allowed. Panel producers 

and fabricators must label products. 

Option SCRSCUR: 

Proposed Option. 

Statutory emissions 

standards where wood 

veneer laminated 

products made with 

wood veneers attached 

to compliant platforms 

using NAF resins are 

exempt from the 

definition of hardwood 

plywood. ULEF 

certification allowed. c 

Reduced recordkeeping 

requirements for nonmfgrs. compared to other 

options. manufacturers.

Same as above

Same emissions standards as Phase 2 of the CARB ATCM, with a different 

definition of hardwood plywood

DistributorsLaminators using NAF resins to attach wood veneers to compliant 

platforms do not need TPC testing and certification. Other laminators must 

have products tested and certified by a TPC. ULEF certification allowed. 

Wholesalers and retailers that are not manufacturers under TSCA would only be 

required to keep invoices and bills of lading. Other recordkeeping equivalent to 

CARB ATCM. No supplier notification required. 

Analytical options with emissions standards other than 

the levels required by TSCA Title VI 

CARB 

Phase 1 levels d

Option CE: CARB 1 emissions standards 

where wood veneer laminated products are 

exempt from the definition of hardwood 

plywood

Hardwood plywood MDF 

Thin MDF

ParticleboardLaminators do not need TPC 

testing or certification. 

0.08 

ppm

0.21 

ppm

0.21 

ppm

0.18 

ppm

Same emissions 

standards as Phase 1 of 

the CARB ATCM. 

Recordkeeping and 

supplier notification 

equivalent to CARB 

ATCM.

Option CI: CARB 1 

emissions standards 

where wood veneer 

laminated products are 

included in the definition 

of hardwood plywood

Same as above

Same emissions standards as Phase 1 of the CARB ATCM, with a different 

definition of hardwood plywood. Recordkeeping and supplier notification 

equivalent to CARB ATCM.Laminators must have products tested and certified 

by a TPC. 

NAF emission 

levels e

Option NE: NAF emissions standards 

where wood veneer laminated products are 

exempt from the definition of hardwood 

plywood

Laminators do not need TPC testing or certification. 

Option NI: NAF emissions standards 

where all wood veneer laminated products 

are included in the definition of hardwood 

plywood

Laminators must have products tested and certified by a TPC. 

NAF emission levels

Option NE: NAF emissions 

standards where wood 

veneer laminated products 

are exempt from the 

definition of hardwood 

plywood

Hardwood plywood: 

90% of samples < 0.04 ppm. 

All samples < 0.05 ppm.

MDF and particleboard: 

90% of samples < 0.04 ppm. 

All samples < 0.06 ppmNote: This document discusses 

various options with respect to formaldehyde and composite 

wood products, including emissions standards that are 

different from those set in TSCA Title VI. This document 

discusses alternative emissions standards simply for 

Requires all composite wood 

product manufacturers to meet 

NAF emission standards. 

Recordkeeping and supplier 

notification equivalent to 

CARB ATCM.

Formatted Table

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Formatted Table

Deleted Cells

Deleted Cells

Deleted Cells
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May 1, 2013 3-4 

Table 3-1: Analytical Options Considered in the Benefits Analysis

informational purposes. The breadth of the discussion here 

should not necessarily imply that EPA has corresponding 

flexibility in implementing the statute.

a

 Panel producers must have products tested and certified by a 

TPC under all options. Recordkeeping and supplier 

notification requirements are equivalent to the CARB ATCM 

unless noted otherwise. 

b

 Emission levels for TSCA Title VI standard certification (and 

CARB Phase 2): Hardwood plywood = 0.05 ppm; MDF = 

0.11 ppm; Thin MDF = 0.13 ppm; Particleboard = 0.09 ppm.

c Emission levels for ULEF certification with reduced quality 

control testing: Hardwood plywood: 90% of samples < 0.05 

ppm and all samples < 0.05 ppm; MDF: 90% of samples < 

0.06 ppm and all samples < 0.09 ppm; thin MDF: 90% of 

samples < 0.08 ppm and all samples < 0.11 ppm; 

Particleboard: 90% of samples < 0.05 ppm and all samples < 

0.08 ppm. Emission levels for ULEF certification with 

quarterly TPC test exemption: Hardwood plywood: 90% of 

samples < 0.04 ppm and all samples < 0.05 ppm; MDF: 90% 

of samples < 0.04 ppm and all samples < 0.06 ppm; thin 

MDF: 90% of samples < 0.04 ppm and all samples < 0.06 

ppm; Particleboard: 90% of samples < 0.04 ppm and all 

samples < 0.06 ppm. 

d

 Emission levels for CARB Phase 1: Hardwood plywood = 

0.08 ppm; MDF = 0.21 ppm; Thin MDF = 0.21 ppm; 

Particleboard = 0.18 ppm.

e

 Emission levels for NAF certification: Hardwood plywood: 

90% of samples < 0.04 ppm and all samples < 0.05 ppm; 

MDF and particleboard: 90% of samples < 0.04 ppm and all 

samples < 0.06 ppm. 

Option NI: NAF emissions 

standards where all wood 

veneer laminated products 

are included in the definition 

of hardwood plywood

Same as above

Requires all composite wood product manufacturers 

to meet NAF emission standards, with a different 

definition of hardwood plywood. CARB 

recordkeeping and supplier notification.

Note: This document discusses various options with respect to formaldehyde and composite wood products, 

including emissions standards that are different from those set in TSCA Title VI. This document discusses 

alternative emissions standards simply for informational purposes. The breadth of the discussion here should not 

necessarily imply that EPA has corresponding flexibility in implementing the statute.

2944 

2945 Figure 3-1 presents an overview of the benefits assessment approach used in this economic 

2946 analysis. The estimated changes in formaldehyde exposure under each analytical option vary by type of 

2947 housing (structure type, amount of composite wood products, and elapsed time since composite wood 

2948 products were installed), climate zone, and the ages and occupations of the exposed individuals (see 

2949 section 3.1). Changes in risks of the adverse health outcomes associated with these changes in exposure 

2950 are estimated for nasopharyngeal cancer (section 3.3) and non-cancer health effects (section ), including 

2951 sensory irritation, asthma incidence, and reduced fertility. the corresponding estimated values of these 

2952 risk reductions (section 3.4). Non-cancer health effects are presenteddiscussed in section 3.5sections and, 

2953 including the monetized benefits from reduced sensory irritation (section 3.5.1), a qualitative discussion 

2954 of respiratory related illnesses (section 3.5.2), and fertility benefits (section 3.5.3 for cancer and non2955 cancer risk reductions, respectively.). The estimated numbers of individuals experiencing these exposure 

2956 reductions are presented in section 3.6. Finally, section 3.7 presents the results of the benefits assessment. 

2957 

Formatted Table
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May 1, 2013 3-5 

Figure 3-1: Overview of Benefits Assessment Approach
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May 1, 2013 3-6 

CHANGE IN EXPOSURE:

Estimate the changes in 

formaldehyde exposure 

attributable to the regulatory 

options 

VALUE OF RISK 

REDUCTION:

Estimate the value of reductions 

in adverse health risks

INDIVIDUALS AFFECTED:

Estimate number of individuals 

experiencing reductions in 

formaldehyde exposure 

attributable to the regulation

CHANGE IN RISK:

Use concentration-response 

functions to estimate the 

resulting reductions in adverse 

health risks

BENEFITS:

Combine: (1) adverse health risk 

reductions, (2) value of 

reductions in adverse health 

risks, and (3) number of 

individuals experiencing 

reduction in risk to estimate total 

benefits by regulatory option

Note: varies by type of 

housing, climate zone, 

age and occupation of 

individual, policy 

scenario

Note: includes 

nasopharyngeal 

cancer, eye irritation, 

asthma, and reduced 

fertility

Note: total net present 

value and annualized 

value for 30 years 

under the policy 

scenario
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May 1, 2013 3-7 

2958 
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May 1, 2013 3-8 

2959 3.1 Estimating the Changes in Exposure by Analytical Option 

2960 

2961 The potential for benefit from the reduction of formaldehyde emissions from composite wood 

2962 products potentially exists anywhere where individuals reside, work, or otherwise spend a substantial 

2963 amount of time where new composite wood products will be introduced to an indoor space. The exposure 

2964 scenarios included in this benefits analysis include two broad categories where a substantial amount of 

2965 new composite wood products might be introduced to residences: (1) new home construction and (2) 

2966 major renovations that include kitchen remodeling. Table 3-2 includes a brief description of the factors 

2967 that were used in this analysis to define the various exposure scenarios. For each analytical option, there 

2968 are 3,300 different exposure scenarios derived from 22 different composite wood product age/source 

2969 combinations, 5 structure types, 5 climate zones, and 6 individual age/employment status combinations. 

2970 

Table 3-2: Exposure Factor Categories Used to Define Population Groups

Exposure 

Factor 

Exposure Factor Categories Discussion 

Composite wood 

product source 

and age 

(n = 22) 

1. New housing construction for 11 ages of the housing 

2. Renovated housing for 11 ages of the installed 

composite wood products 

Note: EPA calculated exposures using a 1.5 year 

emissions half life of formaldehyde from composite 

wood products. With this half life, the emission rate 10 

years after new construction would be about 1 % of the 

initial value, and after 11 years the emissions would be 

near zero. 

New housing has a larger volume of newly 

installed composite wood products (and 

therefore a higher formaldehyde loading rate) 

relative to newly renovated housing, so the 

two sources are analyzed separately. The 

analysis considers composite wood products 

that are up to 11 years old. Thus, the analysis 

considers 11 different ages of new homes and 

11 different ages of renovated housing. 

Structure type 

(n = 5) 

1. Single family attached housing 

2. Single family detached housing 

3. Apartment 

4. Manufactured Housing (e.g., mobile homes) 

5. Recreational Vehicles and Camper/Trailers 

The type of structure affects the volume of 

composite wood products in each structure, air 

exchange rates, and interactions with indoor 

sinks. 

Climate zone 

(n = 5) 

1. Zone 1: <2,000 cooling degree days (CDD) and more 

than 7,000 heating degree days (HDD) 

2. Zone 2: <2,000 CDD and 5,500 to 7,000 HDD 

3. Zone 3: <2,000 CDD and 4,000 to 5,499 HDD 

4. Zone 4: <2,000 CDD and <4,000 HDD. 

5. Zone 5: >2,000 CDD and <4,000 HDD 

Note: Number of degree days is over a 30-year period. 

Because exposure modeling results are 

sensitive to indoor temperature and relative 

humidity, variation in these two factors are 

captured in the analysis by considering five 

climate zones separately. 

Age and 

employment 

status 

(n = 6) 

1. Infants: less than age 2 

2. Children: aged 2 through 15 

3. Ages 16+; work full-time outside the composite wood 

products industry 

4. Ages 16+; work in composite wood products 

fabrication 

5. Ages 16+; work part-time outside the composite 

wood products industry 

6. Ages 16+; unemployed or not in the labor force 

Average daily concentrations of formaldehyde 

exposure were estimated to vary according to 

age and employment status because these 

factors affect the formaldehyde exposures 

outside the housing unit and the amount of 

time spent inside and outside the housing unit. 

2971 
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May 1, 2013 3-9 

2972 3.2 Time Frame for the Analysis 

2973 

2974 This analysis estimates the benefits of each analytical option for lowering formaldehyde 

2975 emissions from composite wood products over a 30-year period. This time frame was selected to be as 

2976 short as possible while being long enough to capture the important effects of the policy. In general, the 

2977 downside of choosing a longer analysis time frame is that uncertainties about both the baseline and policy 

2978 scenarios increase with time. For example, the likelihood that alternative technologies for manufacturing 

2979 composite wood products might be developed increases over time (which could result in different 

2980 formaldehyde emission rates for products and/or different costs for reducing formaldehyde emissions). 

2981 Similarly, uncertainties about changing demographics, medical treatments for adverse health effects, and 

2982 consumer preferences with respect to composite wood products all increase with time. However, 

2983 selecting a time frame that is too short would not capture all of the important effects of the policy 

2984 scenarios under consideration. 

2985 

2986 The benefits analysis assumes that after eleven years any continuing (and declining) emissions 

2987 from a given composite wood product would contribute negligibly to that product's effect on 

2988 formaldehyde exposure. Thus, composite wood products are assumed to contribute to formaldehyde 

exposure for 11 years.37 2989 Specifically: 

2990 

2991  in the first year only new composite wood products are affected by the policy; 

2992  in the second year new and one-year-old composite wood products are affected by the 

2993 policy; 

2994  in the third year new, one- and two-year-old composite wood products are affected by the 

2995 policy; 

2996  in general, in the nth year, new, one-, two-, three-,..., and (n-1)-year-old composite wood 

2997 products are affected by the policy, for n = 1, 2, ..., 10; and 

2998  in the eleventh and all subsequent years new, one-, two-, three-, four-, five-, six-, seven-, 

2999 eight-, nine-, and ten-year-old composite wood products are affected by the policy. 

3000 

3001 Since the exposure scenarios are defined in part according to the 11 different ages for composite 

wood products, it is not until the 11th 3002 year after the implementation of the rule that benefits are realized 

under every exposure scenario. That is, it is not until the 11th 3003 year after rule implementation that ten-year 

3004 old composite wood products would have been required to be produced in compliance with the emissions 

3005 standards. Thus, the benefits are phased in over a period of eleven years. 

3006 

3007 Similarly, the benefits from a given year of composite wood production will phase-out over time. 

3008 Since the analysis considers the benefits and costs from 30 years of composite wood production, the 

estimated exposures have the following time profile after the 30th 3009 and last year of composite wood 

3010 production considered in the analysis: 

3011 

 in the 31st 3012 year, only one-, two-, three-, four-, five-, six-, seven-, eight-, nine-, and tenyear-old composite wood products are produced before the 31st 3013 year (benefits from new 

3014 composite wood products are produced after year 30 and therefore are not considered in 

3015 the analysis); 

 in the 32nd 3016 year, only two-, three-, four-, five-, six-, seven-, eight-, nine-, and ten-year-old 

composite wood products are produced before the 31st 3017 year (benefits from new and one-

 37 EPA calculated exposures using a 1.5 year emissions half life of formaldehyde from composite wood products With. 

this half life, the emission rate 10 years after new construction would be about 1 % of the initial value, and after 11 

years the emissions would be near zero. 
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May 1, 2013 3-10 

3018 year old composite wood products are produced after year 30 and therefore are not 

3019 considered in the analysis); 

3020  in general, in the nth year after year 30, only n year-old and older composite wood 

3021 products are produced before year 31, for n = 1, 2, ..., 10; and 

 in the 41st 3022 and all subsequent years, all 11 ages of composite wood products that 

potentially contribute to formaldehyde exposure are produced after the 30th 3023 year and 

3024 therefore are not considered in the analysis. 

3025 

3026 Given this phase-in and phase-out, a time period of thirty years of composite wood production 

3027 was selected so that the first ten years of the policy (when the benefits of the policy are being phased in) 

3028 and the ten years after the 30 years of composite wood production that is analyzed (when the benefits of 

3029 the policy are being phased out) do not obscure the steady state benefits that would be experienced from 

3030 the policy. It is necessary to include the phase-in and phase-out of the benefits in order to be consistent 

3031 with the cost estimates, which reflect the costs of 30 years of production that complies with the emissions 

3032 standards. Given that this analysis assumes that after eleven years any continuing (and declining) 

3033 emissions from a given composite wood product would contribute negligibly to that product's effect on 

3034 formaldehyde exposure, 30 years of production that complies with the emissions standards corresponds to 

3035 40 years of exposure reductions. The first 10 years are a phase-in period for exposure reductions, the next 

3036 20 years are a steady-state, and the next 10 years are a phase-out period. 
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May 1, 2013 3-11 

3037 3.3 Assessing the Change in Cancer Risk 

3038 

3039 In 1991, EPA classified formaldehyde as a probable human carcinogen, “based on limited 

3040 evidence in humans, and sufficient evidence in animals,” and derived an inhalation unit risk for assessing 

3041 formaldehyde cancer risk. The inhalation unit risk and supporting documentation is included in EPA’s 

3042 Integrated Risk Information System (IRIS) assessment of formaldehyde (Ref. 5). Formaldehyde is also 

3043 listed under section 112(b)(1) of the Clean Air Act (CAA) as a hazardous air pollutant (HAP). The CAA 

3044 requires EPA to regulate emissions of HAPs from a published list of industrial source categories. The 

3045 EPA has developed lists of major and area source categories that must meet emission standards for HAPs 

3046 and has developed (or is developing) standards for these source categories. The plywood and composite 

3047 wood products (PCWP) National Emission Standards for Hazardous Air Pollutants (NESHAP), codified 

3048 at 40 CFR part 63, subpart DDDD, first issued in 2004, is one of these standards. The PCWP NESHAP 

3049 controls emissions of formaldehyde and other HAPs (primarily acetaldehyde, acrolein, methanol, phenol, 

3050 and proprionaldehydepropionaldehyde) from various process units (e.g., blenders, dryers, formers, board 

3051 coolers, and presses) at PCWP facilities. 

3052 

3053 In 2004, the EPA determined that unit risk derived from the Chemical Industry Institute of 

3054 Toxicology (CIIT 1999; CIIT 1999)) biologically-based cancer dose-response modeling of formaldehyde3055 induced respiratory cancer (5.5 x 10-9 per micrograms per cubic meter (μg/m3)) better reflected the 

3056 current state of the science than the 1991 IRIS cancer unit risk. In 2004, EPA determined that the CIIT3057 derived inhalation unit risk better reflected the current state of the science than the 1991 IRIS cancer 

3058 inhalation unit risk. The authors of the CIIT modeling (Conolly, et al. 2004(Conolly et al. 2004))

3059 presented their risk estimates as values more conservative than their maximum likelihood estimates, and 

3060 as “conservative in the face of modeling uncertainties.” Consequently, EPA used the CIIT value in risk 

3061 assessments supporting regulatory actions developed under the authority of the Clean Air Act. For 

3062 example, in the 2006 rulemaking that reconsidered the PCWP NESHAP, OAR stated “[i]n the case of 

3063 formaldehyde, we have determined that the cancer potency derived using the approach developed by 

3064 CIIT, which has been peer reviewed by an external review panel sponsored by EPA and the Canadian 

3065 government, represents an appropriate alternative to EPA’s current IRIS URE [unit risk estimate] for 

3066 formaldehyde. Therefore, this potency represents the best available peer-reviewed science at this time.” 

3067 (EPA 2006(Ref. 6, p. 8348).). However, subsequent research published by the EPA suggests that the 

3068 CIIT model was not appropriate and was very sensitive to unmeasured parameters such that very different 

3069 estimates, including the 1991 IRIS assessment values, were consistent with the available scientific data. 

3070 Because the CIIT values do not reflect the uncertainty in estimates using the data that are available, EPA 

3071 has decided that those estimates do not reflect the broad range of possible risk and that the data are not 

supportive of interpreting 5.5 X 10-9 per μg/m3 3072 as providing a health-protective estimate of human risk. 

3073 Furthermore, the 1991 IRIS assessment values are consistent with unit risks estimated by Schlosser et al. 

3074 (Schlosser, et al. 2003(2003)) based on Benchmark Dose modeling of the best available data at the time. 

3075 In addition, the CIIT values do not address the potential risk of increased leukemias or lymphomas. Thus, 

in 2010, EPA returned to using the Agency’s current value on IRIS, 1.3 X 10-5 per μg/m3 3076 , which was last 

3077 revised in 1991 as better reflecting the current state of the science as to the potential human cancer risk of 

3078 exposure to formaldehyde (EPA 2010bRef. 7).). 

3079 

3080 The inhalation unit risk is defined as the upper-bound excess lifetime cancer risk estimated to 

3081 result from continuous exposure to an agent at a concentration of 1 μg/m3 in air (see 

3082 http://www.epa.gov/iris/help_gloss.htm#i). The change in excess cancer risk can be estimated by 

multiplying the lifetime average daily concentration (LADC) of formaldehyde exposure, in mg/m3 3083 , by the 

inhalation unit risk of 0.013 per mg/m3 3084 and the age-dependent adjustment factor (ADAF) of 10, 3, or 1 for 

3085 individuals aged less than 2, 2-15, or 16 and older, respectively. Note that EPA policy is to apply ADAFs 

3086 when there is a mutagenic mode of action. The 1991 IRIS assessment did not make a formal finding of a 

3087 mutagenic mode of action. However, there is scientific support for a mutagenic mode of action. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-12 

3088 Therefore, EPA believes that application of ADAFs is the preferred approach in this case but is also 

3089 presenting the calculations without applying ADAFs. The lower estimate of benefits excludes the 

3090 ADAFs and the higher estimate of benefits includes the ADAFs. 

3091 

3092 Since the inhalation unit risk was estimated to be applied to the LADC, the most straightforward 

3093 approach to calculate excess lifetime risk associated with exposure to formaldehyde would be to take the 

3094 average daily concentration (ADC) for various life segments of an individual and construct the overall 

3095 LADC, then multiply the ADCs by the unit risk and ADAF. For example, assume that an individual has 

3096 the following life profile: 

3097 

Age 0 (infant): Lives in a new house 

Age 2 (child): Lives in the same house (now with 2 years of off-gassing) 

Age 16: Moves to a new house 

Age 32: Moves to a new house 

Age 48: Moves to a new house 

Age 64: Moves to a new house 

Age 70: Death 

3098 

3099 The excess lifetime risk could be calculated as: 

3100 

Excess lifetime risk ൌ

1

ܧܮ

ە

ۖ

۔

ۖ

ۓቀܥܦܣ଴ିଵ ൈ ሺ2 ݕ݁ܽݏݎሻ ൈ ൫ܨܣܦܣ௡௔௙௡௜௧൯ቁ 

൅൫ܥܦܣଶିଵହ ൈ ሺ14 ݕ݁ܽݏݎሻ ൈ ሺܨܣܦܣ௟௜௛௖ௗሻ൯ 

൅൫ܥܦܣଵ଺ିଷଵ ൈ ሺ16 ݕ݁ܽݏݎሻ൯ ൅ ൫ܥܦܣଷଶିସ଻ ൈ ሺ16 ݕ݁ܽݏݎሻ൯

൅൫ܥܦܣସ଼ି଺ଷ ൈ ሺ16 ݕ݁ܽݏݎሻ൯ ൅ ൫ܥܦܣ଺ସି଺ଽ ൈ ሺ6 ݕ݁ܽݏݎሻ൯ ۙ

ۖ

ۘ

ۖ

ۗ

ൈ ሺܷ݊݅ݐ ܴ݅ݏ݇ሻ (3) 

3101 

3102 where: 

3103 

ADC0-1 = the ADC from exposure to formaldehyde in a new house for two years. 

ADC2-15 = the ADC from exposures over 14 years from a house that is 2 years old in the first year. 

ADC a-a+16 = the ADC from exposures over 16 years from a house that is new in the first year (for the 16-

31, 32-47, and 48-63 age intervals) 

ADC64-69 = the ADC from exposures over 6 years from a house that is new in the first year (for the 64-69 

age interval) 

ADAFinfant the infant age-dependent adjustment factor of 10 

ADAFchild the child age-dependent adjustment factor of 3 

Unit Risk the inhalation unit risk for cancer of 0.013 per mg/m3

LE= the life expectancy of the individual 

3104 

3105 Note that the unit risk is an estimate of excess lifetime cancer risk associated with an average 

3106 lifetime exposure to one unit of the carcinogen; it gives no information about how this lifetime excess risk 

3107 is distributed across the ages within a lifetime. It also gives no information about whether the distribution 

3108 of annual exposures that result in a given average lifetime exposure matters. Equation (3) implicitly 

3109 assumes that the distribution of exposures throughout a lifetime doesn’t matter – i.e., that all that matters 

3110 is the lifetime average exposure. 

3111 

3112 To calculate the expected number of excess cancer cases resulting from a given excess 

3113 lifetime risk, this excess risk must be multiplied by the relevant population. If pop denotes the size of the 

3114 population that incurs the excess lifetime risk, then the expected number of cancer cases associated with 

3115 exposure to formaldehyde given the scenario described above is: 

3116 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-13 

Number of cancer cases = excess lifetime risk * pop. (4) 

3117 

3118 This calculation could then be done for both the baseline scenario and the policy scenario (in 

3119 which exposures would be lower) to estimate the number of cancer cases avoided as a result of the policy: 

3120 

Number of cancer casesbaseline = excess lifetime riskbaseline * pop 

Number of cancer casespolicy scenario = excess lifetime riskpolicy scenario * pop 

Number of cases avoided due to policy scenario 

= Number of cancer casesbaseline - Number of cancer casespolicy scenario. 

(5) 

3121 

3122 If V denotes the value of an avoided case, then the value of the avoided cases is: 

3123 

Value of avoided cases = V* Number of cases avoided. (6) 

3124 

3125 If the lifetime costs of this action were also added up, the overall net gain or loss that this 

3126 individual would receive from this action could be estimated. If this could be done for all individuals in 

3127 society, the overall net benefits of the policy could be estimated. To do this, it would be necessary to 

3128 assume a life profile for every individual (i.e., how often each individual moves, and the structure type 

3129 and age of housing they live in at each stage of their life, and how recently it has been renovated). 

3130 

3131 Instead, this analysis utilizes an annual approach, which evaluates the expected change in the 

3132 lifetime cancer risk for an individual arising from a single year of reduced formaldehyde exposure. In 

3133 contrast, a lifetime approach would require assuming a lifetime formaldehyde exposure profile for each 

3134 individual and evaluating the expected change in the lifetime cancer risk for an individual arising from a 

3135 lifetime of reduced formaldehyde exposure. The exposure model was designed to produce a LADC 

3136 associated with the same scenario used to calculate the ADC. Thus, it can produce a LADC for any life 

3137 segment for which an ADC can be calculated (e.g., exposure over the course of 11 years to an individual 

3138 who moves into a 2 year old house). Conceptually, this would be equivalent to the lifetime average daily 

3139 concentration if one were exposed to the pollutant for only this life segment and no other time. Another 

3140 interpretation is that it is the contribution to the overall LADC from this life segment. In other words: 

3141 

ሻ൯ݐ ݀݋݅ݎ݁݌ ݅݊ ݁ݎݑݏ݋݌ݔ݁ ݂݋ ݏݎܻ݁ܽሺ ൈ ௧ܥܦܣ൫ ൌ ௧ܥܦܣܮ

ሺܻ݁ܽݏݎ ݅݊ ܽ ݈݂݅݁ݐ݅݉݁ሻ ൌ ൭

ݕ݈ܽ݅ܦ ܽ݃݁ݎ݁ݒܣ ݅݉݁ݐ݂݅݁ܮ

݈݂݅݁ ݎ݋݂ ݊݋݅ݐܽݎݐ݊ܿ݁݊݋ܥ

 (7) ൱ ݐ ݐ݁݃݉݁݊ݏ

3142 

3143 Where: 

3144 

௧ܥܦܣܮ ෍ ൌ ܥܦܣܮ

௧ୀ௧௜௠௘ ௣௘௥௜௢ௗ௦

(8) 

 

3145 

3146 Equation (3) combined with equation (7) can be used to calculate the excess cancer risk 

3147 associated with any given life segment. For example, the excess cancer risk associated with the 2-15 year 

3148 old life segment for a child starting in a 2-year old house could be calculated as: 

3149 

ሺݔܧܿ݁ݏݏ ܿܽ݊ܿ݁ݎ ݎ݅ݏ݇ሻ஺௚௘ ଶିଵହ ൌ ܥܦܣܮଶିଵହ ൈ ሺܨܣܦܣ௟௜௛௖ௗሻ ൈ ሺܷ݊݅ݐ ܴ݅ݏ݇ሻ (9) 

3150 

3151 Excess cancer risk for segment t consisting of a single year for a single individual can be 

3152 calculated as: 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-14 

3153 

ሺݔܧܿ݁ݏݏ ܿܽ݊ܿ݁ݎ ݎ݅ݏ݇ሻ௧ ൌ ܥܦܣܮ௧ ൈ ൫ܨܣܦܣ௔ ௘௚௔௧ ௧൯ ൈ ሺܷ݊݅ݐ ܴ݅ݏ݇ሻ (10) 

 3154 

In equation (10), the LADCt 3155 is determined by the concentration in a home in which the individual 

3156 resides, e.g., a one-year old home for a seventeen-year old individual. 

3157 

3158 The advantage to this approach is that the life profile for each individual is not necessary; it is 

3159 only necessary to know his or her location for that life segment. 

3160 

3161 It is easy to show that, mathematically, the lifetime approach to calculating excess risk and the 

3162 annual approach are equivalent. The annual approach simply estimates the amount that any given year of 

3163 exposure contributes to the overall excess cancer risk from some lifetime average daily concentration. 

3164 Specifically, starting with equation (3) from above: 

3165 

ൌ ݇ݏ݅ݎ ݎܿܽ݊ܿ݁ ݏݏܿ݁ݔܧ

൬ 1൰ܧܮ

ە

ۖ

۔

ۖ

ۓቀܥܦܣ଴ିଵ ൈ ሺ2 ݕ݁ܽݏݎሻ൫ܨܣܦܣ௡௔௙௡௜௧൯ቁ 

൅൫ܥܦܣଶିଵହ ൈ ሺ14 ݕ݁ܽݏݎሻ ൈ ሺܨܣܦܣ௟௜௛௖ௗሻ൯ 

൅൫ܥܦܣଵ଺ିଷଵ ൈ ሺ16 ݕ݁ܽݏݎሻ൯ ൅ ൫ܥܦܣଷଶିସ଻ ൈ ሺ16 ݕ݁ܽݏݎሻ൯

൅൫ܥܦܣସ଼ି଺ଷ ൈ ሺ16 ݕ݁ܽݏݎሻ൯ ൅ ൫ܥܦܣ଺ସି଺ଽ ൈ ሺ6 ݕ݁ܽݏݎሻ൯ ۙ

ۖ

ۘ

ۖ

ۗ

ൈ ሺܷ݊݅ݐ ܴ݅ݏ݇ሻ

ൌ

ە

ۖ

ۖ

۔

ۖ

ۖ

ۓቀܥܦܣ଴ିଵ ൈ ሺ2 ݕ݁ܽݏݎሻ൫ܨܣܦܣ௡௔௙௡௜௧൯ቁ

ܧܮ ൅ ൫ܥܦܣଶିଵହ ൈ ሺ14 ݕ݁ܽݏݎሻ ൈ ሺܨܣܦܣ௟௜௛௖ௗሻ൯ 

ܧܮ

൅ ൫ܥܦܣଵ଺ିଷଵ ൈ ሺ16 ݕ݁ܽݏݎሻ൯

ܧܮ ൅ ൫ܥܦܣଷଶିସ଻ ൈ ሺ16 ݕ݁ܽݏݎሻ൯

൅ ܧܮ

൫ܥܦܣସ଼ି଺ଷ ൈ ሺ16 ݕ݁ܽݏݎሻ൯

ܧܮ ൅ ൫ܥܦܣ଺ସି଺ଽ ൈ ሺ6 ݕ݁ܽݏݎሻ൯

ۙ ܧܮ

ۖ

ۖ

ۘ

ۖ

ۖ

ۗ

ൈ ሺܷ݊݅ݐ ܴ݅ݏ݇ሻ

(11) 

ൌ ቊ ܥܦܣܮ଴ିଵ ൈ ൫ܨܣܦܣ௡௔௙௡௜௧൯ ൅ ܥܦܣܮଶିଵହ ൈ ሺܨܣܦܣ௟௜௛௖ௗሻ

൅ܥܦܣܮଵ଺ିଷଵ ൅ ܥܦܣܮଷଶିସ଻ ൅ ܥܦܣܮସ଼ି଺ଷ ൅ ܥܦܣܮ଺ସି଺ଽ ቋ ൈ ሺܷ݊݅ݐ ܴ݅ݏ݇ሻ

ൌ ൛ܥܦܣܮ଴ିଵ ൈ ൫ܨܣܦܣ௡௔௙௡௜௧൯ ൈ ሺܷ݊݅ݐ ܴ݅ݏ݇ሻൟ ൅ ሼܥܦܣܮଶିଵହ ൈ ሺܨܣܦܣ௟௜௛௖ௗሻ ൈ ሺܷ݊݅ݐ ܴ݅ݏ݇ሻሽ

൅ ሼܥܦܣܮଵ଺ିଷଵ ൈ ሺܷ݊݅ݐ ܴ݅ݏ݇ሻሽ ൅ ሼܥܦܣܮଷଶିସ଻ ൈ ሺܷ݊݅ݐ ܴ݅ݏ݇ሻሽ

൅ ሼܥܦܣܮସ଼ି଺ଷ ൈ ሺܷ݊݅ݐ ܴ݅ݏ݇ሻሽ ൅ ሼܥܦܣܮ଺ସି଺ଽ ൈ ሺܷ݊݅ݐ ܴ݅ݏ݇ሻሽ

ൌ ൛ܥܦܣܮ ଴ൈ ൫ܨܣܦܣ௡௔௙௡௜௧൯ ൈ ሺܷ݊݅ݐ ܴ݅ݏ݇ሻൟ ൅ ൛ܥܦܣܮଵ ൈ ൫ܨܣܦܣ௡௔௙௡௜௧൯ ൈ ሺܷ݊݅ݐ ܴ݅ݏ݇ሻൟ

൅ ሼܥܦܣܮଶ ൈ ሺܨܣܦܣ௟௜௛௖ௗሻ ൈ ሺܷ݊݅ݐ ܴ݅ݏ݇ሻሽ ൅ ڮ

൅ ሼܥܦܣܮଵହ ൈ ሺܨܣܦܣ௟௜௛௖ௗሻ ൈ ሺܷ݊݅ݐ ܴ݅ݏ݇ሻሽ ൅ ሼܥܦܣܮଵ଺ ൈ ሺܷ݊݅ݐ ܴ݅ݏ݇ሻሽ ൅ ڮ

൅ ሼܥܦܣܮ଺ଽ ൈ ሺܷ݊݅ݐ ܴ݅ݏ݇ሻሽ

(12) 

3166 

3167 where: 

3168 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-15 

ADC0-1 = the ADC from exposure to formaldehyde in a new house for two years. 

ADC2-15 = the ADC from exposures over 14 years from a house that is 2 years old in the first year. 

ADC a-a+16 = the ADC from exposures over 16 years from a house that is new in the first year (for the 16-

31, 32-47, and 48-63 age intervals) 

ADC64-69 = the ADC from exposures over 6 years from a house that is new in the first year (for the 64-69 

age interval) 

ADAFinfant the infant age-dependent adjustment factor of 10 

ADAFchild the child age-dependent adjustment factor of 3 

Unit Risk the inhalation unit risk for cancer of 0.013 per mg/m3

LE= The life expectancy of the individual 

LADC0-1 = ADC0-1 / LE 

LADC2-15 = ADC2-15 / LE 

LADC a-a+16 = ADC a-a+16 / LE 

LADC64-69 = ADC64-69 / LE 

 3169 

3170 The change in excess cancer risk resulting from the policy (relative to baseline) is: 

3171 

ൌ ൛൫ܥܦܣܮ଴

଴ܥܦܣܮ െ௕ 

௣൯ ൈ ൫ܨܣܦܣ௡௔௙௡௜௧൯ ൈ ሺܷ݊݅ݐ ܴ݅ݏ݇ሻൟ ൅

 ൛൫ܥܦܣܮଵ

௕ െ ܥܦܣܮଵ

௣

൯ ൈ ൫ܨܣܦܣ௡௔௙௡௜௧൯ ൈ ሺܷ݊݅ݐ ܴ݅ݏ݇ሻൟ൅ڮ൅

 ൛൫ܥܦܣܮ଺ଽ

௕ െ ܥܦܣܮ଺ଽ

௣ ൯ ൈ ሺܷ݊݅ݐ ܴ݅ݏ݇ሻൟ

(13) 

3172 

where LADCB

 and LADCP 3173 refer to the baseline and policy scenario LADCs, respectively. To 

3174 evaluate the impact of the policy for a single year (for example, when the individual is 15 years old) the 

3175 change in excess cancer risk for this single year would be simply: 

3176 

ൌ ൛൫ܥܦܣܮଵହ

௕ െܥܦܣܮଵହ

௣ ൯ ൈ ሺܨܣܦܣ௟௜௛௖ௗሻ ൈ ሺܷ݊݅ݐ ܴ݅ݏ݇ሻൟ (14) 

3177 

3178 Thus, the annual excess cancer risk reduction can be calculated for an individual of any age 

3179 associated with one year of the policy. At the population level, the annual approach consists of analyzing 

3180 a population profile of individuals consistent with current demographic data, and placing them in housing 

3181 stock consistent with current real estate data and calculating the benefits accruing from one year of the 

3182 policy, all else constant. 

3183 

3184 Since the policy is analyzed over a period of thirty years, the analysis assumes that the 

3185 demographic profile of the population (e.g., population distribution by age, size, and type of housing) 

3186 does not change over time. Thus, depending on how these demographics actually change over the next 

3187 thirty years, this assumption could result in the introduction of an upward or downward bias into the 

3188 benefits estimate. For example, if the number of people moving into new housing is lower than assumed 

3189 over the next thirty years then the current assumption introduces an upward bias to the benefits estimate. 

3190 Similarly, if the population increases over time, then the current assumption introduces a downward bias 

3191 to the benefits estimate. 

3192 

3193 It is also worth noting that if the analysis were to attempt to account for demographic shifts over 

3194 time, it would also be necessary to estimate how these demographic shifts would affect the demand for 

3195 composite wood products and therefore impact the costs that correspond to the estimated benefits – 

3196 something that would not be possible to model without introducing additional uncertainty. Therefore, 

3197 attempting to relax the simplifying assumption that demographics are constant over the 30-year analysis 

3198 time frame would address one uncertainty while introducing another uncertainty and it is not clear that 

3199 this would reduce the overall uncertainty in the estimate of net benefits. 

3200 

3201 There are a number of advantages to using the annual approach as opposed to the lifetime 

3202 approach. With the annual approach actual demographic data can be used to estimate the number of 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-16 

3203 individuals in each exposure scenario. This way the housing stock used in the simulation will resemble 

3204 the existing housing stock. Recent data from the Census and housing surveys are a reasonable 

3205 approximation of what the distribution will be in the near future. This approach avoids the need to 

3206 estimate a survival function to correctly account for premature deaths (or be concerned with new births). 

3207 Assuming demographics do not change, using a population-weighted annual approach accounts for these 

3208 factors. 

3209 

3210 It is also important to note some caveats associated with the annual approach. As just mentioned, 

3211 some distribution of population and housing stock must be assumed, and it is assumed that the current 

3212 distribution is a good indicator of the future distribution. In other words, the analysis is implicitly 

3213 assuming a steady state, where the present distribution closely approximates the future distribution. 

3214 

3215 3.3.1 Lower Estimate of the Excess Number of Cancer Cases 

3216 

3217 Most individuals in the analysis are more than 0 years old, so applying a unit risk – i.e., an excess 

3218 lifetime risk – to them might overstate their excess risk of the cancer. For example, consider someone 

3219 who is 50 years old in the year of the analysis and has not yet gotten the cancer. Should the entire excess 

3220 lifetime risk (the unit risk) be applied to this individual for the remaining expected years of his life? Or 

3221 should a modified excess risk, conditional on his not having gotten the cancer in his first 49 years, be 

3222 applied? Because the unit risk provides no information about how excess risk is distributed over the 

3223 course of a lifetime, there is no clear answer. 

3224 

3225 To address this uncertainty this analysis therefore includes a lower estimate of the excess number 

3226 of cancer cases that is calculated by multiplying the unit risk by a lowering factor that takes into account 

3227 the age at which an individual experiences the change in exposure and the incidence of the cancer by that 

3228 age. Specifically, the lowering factor is calculated as the percentage of incidence of the cancer that 

3229 occurs within the age range spanning from the age at which the change in exposure is experienced 

3230 through the end of the expected lifetime. For example, 56.6 percent of respiratory tract cancers occur 

3231 between ages 50 and 81 (the life expectancy of a 50 year old). Therefore the lowing factor for an 

3232 individual experiencing a one year change in exposure at age 50 is 0.566. This approach implicitly 

3233 assumes that the excess lifetime risk of the cancer is distributed across the ages within a lifetime in the 

3234 same pattern seen in the age-specific incidences of the cancer in the population. 

3235 

3236 3.3.2 Summary of Approach to Estimate Change in Cancer Risk 

3237 

3238 Equations (15) and (16) present the equations that are used to calculate the lower and higher 

3239 estimates for the change in cancer risk associated with a one year change in the average daily 

3240 concentration of formaldehyde exposure. Note that EPA policy is to apply ADAFs when there is a 

3241 mutagenic mode of action. The 1991 IRIS assessment did not make a formal finding of a mutagenic mode 

3242 of action. However, there is scientific support for a mutagenic mode of action. Therefore, EPA believes 

3243 that application of ADAFs is the preferred approach in this case but is also presenting the calculations 

3244 without applying ADAFs. The lower estimate of benefits excludes the ADAFs and the higher estimate of 

3245 benefits includes the ADAFs. 

3246 

ሺCancer Risk Changeሻ୪୭୵ୣ୰ ୣୱ୲୧୫ୟ୲ୣ ൌ ൫ADCୠ ൯ െ ൫ADC୮ ൯

LE ൈ ሺUnit Riskሻ ൈ ሺLowering Factorሻ (15) 

3247 

ሺCancer Risk Changeሻ୦୧୥୦ୣ୰ ୣୱ୲୧୫ୟ୲ୣ ൌ ൫ADCୠ ൯ െ ൫ADC୮ ൯

LE ൈ ADAF ൈ ሺUnit Riskሻ (16) 

3248 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-17 

3249 where: 

3250 

ADCb = the baseline average daily concentration of one year of formaldehyde exposure (in 

mg/m3

) 

ADCp

 = the average daily concentration of one year of formaldehyde exposure (in mg/m3) in 

the policy scenario 

LE = the life expectancy of the individual given his current age (i.e., the age to which he is 

expected to live, given his current age) 

ADAF = the age dependent adjustment factor (10 for 0-1 year olds, 3 for 2-15 year olds, 1 

otherwise) 

Lowering Factor = factor calculated as the percentage of incidence of the cancer that occurs within the 

age range spanning from the age at which the change in exposure is experienced 

through the end of the expected lifetime. 

3251 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-18 

3252 3.4 Estimating the Value of Reductions in Cancer Risk 

3253 

3254 In this analysis the number of excess cancer cases are estimated and then they are divided into 

3255 two categories: (1) instances where individuals will ultimately die from the cancer, and (2) instances 

3256 where individuals ultimately die from something other than the cancer. Note that these two categories 

3257 reflect the two possible outcomes for nasopharyngeal cancer, instead of reflecting different types of 

3258 cancers. Hereafter the first outcome is referred to as fatal cancer and the second outcome as nonfatal 

3259 cancer. Each outcome is valued differently – the value of a reduction in the risk of fatal cancer is 

3260 described in section 3.4.1, and the value of a reduction in the risk of non-fatal cancer, described in section 

3261 3.4.2. 

3262 

3263 In order to monetize the value of reduced cancer risk, it is necessary to estimate the time periods 

3264 when these benefits would accrue so that the present value of these benefits can be calculated. The 

3265 method for estimating the timing for when the reduced cancer risks are realized and the method for 

3266 calculating the value of reducing these risks at the time of the exposure is described below in section 

3267 3.4.3. 

3268 

3269 3.4.1 The Value of a Micro Risk Reduction for Fatal Cancer 

3270 

3271 The value of reducing risk for nasopharyngeal cancer is estimated as a weighted average of the 

3272 value of reducing both fatal and nonfatal cancer risks. According to data from the Surveillance, 

3273 Epidemiology, and End Results (SEER) Program of the National Cancer Institute, the 15 year survival 

3274 rate for cancers of the nasopharynx is 42.9 percent (SEER 2010). Thus, the analysis assumes that 57.1 

3275 percent of the reductions in cancer risk are reductions in mortality risk and therefore are valued as such. 

3276 The analysis uses the value of mortality risk (VMR) of $8.01 per micro-risk. A micro risk reduction is a 

3277 reduction of 1/1,000,000 in the risk of mortality. This benefit is assumed to be accrued at the end of the 

3278 year in which a cancer case was avoided and no additional benefits (e.g., from avoiding cancer treatment 

3279 costs) are included in the instances of a mortality risk reduction. 

3280 

3281 3.4.2 The Value of a Micro Risk Reduction for Non-Fatal Cancer 

3282 

3283 As noted above, 42.9 percent of the cancer risk reductions are assumed to be reductions in risk for 

3284 non-fatal cancer. While it is the value of a micro reduction in risk (a risk reduction of 1/1,000,000) of 

3285 non-fatal nasopharyngeal cancer that is of interest, this was estimated by first estimating the expected 

3286 value of a single avoided case of non-fatal nasopharyngeal cancer and then dividing by 1,000,000 to 

obtain the implied value of a micro risk reduction.38 3287 

3288 

3289 Non-fatal cases of nasopharyngeal cancer were valued using a cost-of-illness (COI) approach. 

3290 The value of an avoided case of non-fatal nasopharyngeal cancer was estimated to be the present 

3291 discounted value (pdv) of the stream of expected medical expenditures and opportunity costs associated 

3292 with the illness from the year of diagnosis to a preset age (set at 99 in this analysis), taking into account 

that the individual may die of other causes in each year in the analysis. 39 3293 

3294 

 38 If 1,000,000 people are each willing to pay y for a risk reduction of 1 in 1,000,000, then that risk reduction applied to 

1,000,000 individuals would result in 1 expected case avoided, and the value of that expected avoided case would be the 

sum of the individuals’ WTPs for their risk reductions, or 1,000,000*y. If Y denotes the value of that expected avoided 

case, then Y = 1,000,000*y, so that y = Y/1,000,000. For example, suppose the estimated value of an avoided case of 

non-fatal nasopharyngeal cancer is $140,000. The implied value of a micro risk reduction would be $0.14. 

39 This COI approach likely understates the true value of avoiding a case of non-fatal nasopharyngeal cancer because it 

omits the individual’s willingness to pay to avoid the pain and suffering associated with the illness, which may be 

substantial. 
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3295 One approach to estimating the costs associated with a chronic illness such as cancer, described in 

3296 EPA’s Cost of Illness Handbook (U.S. EPA 2001), is to divide annual costs into three categories: (1) 

3297 initial costs – costs of diagnosis and initial treatment costs – that occur in the year of diagnosis, (2) 

3298 “maintenance” costs which the cancer patient incurs in each subsequent year prior to death, and (3) 

3299 terminal costs – the costs incurred in the patient’s last year of life. This analysis followed this general 

3300 approach. Because this section is concerned only with non-fatal cases of nasopharyngeal cancer, only the 

3301 first two categories are included. 

3302 

3303 As described more fully below, the stream of annual costs of a cancer will depend on: 

3304 

3305  the stage of the cancer when it is first diagnosed; 

3306  the individual’s employment status (full-time worker, part-time worker, or unemployed 

3307 or retired) each year from the year of diagnosis on (since the value of an hour lost to the 

3308 illness depends on this status, as is explained below); and 

3309  the individual’s age in the year of diagnosis. 

3310 

3311 3.4.2.1 An outline of the approach 

3312 

3313 The analysis estimated the pdv of a case of non-fatal nasopharyngeal cancer, conditional on age at 

3314 diagnosis, using the following steps: 

3315 

3316  Develop a profile of nasopharyngeal cancer – i.e., a description of the stages of the cancer 

3317 and the treatments typically carried out or recommended at each stage, their frequencies, 

3318 durations, and costs. 

3319  Estimate COI conditional on stage at diagnosis and age at diagnosis, a: 

3320 o Estimate the medical costs and opportunity costs in the year of diagnosis, given 

3321 the stage at diagnosis and age at diagnosis. 

3322 o Estimate the “maintenance” medical costs and associated opportunity costs in the 

3323 kth year after diagnosis, k = 1, 2, ..., given the stage at diagnosis and age at 

3324 diagnosis. 

3325 o Given these (conditional) kth year costs, k = 0, 1, 2, ..., and the survival 

3326 probabilities for ages a, a +1, a +2, etc. (i.e., the probability of not dying of some 

3327 other cause each year), estimate the expected total COI in each year, conditional 

3328 on a given stage at diagnosis and age at diagnosis, a. 

3329 o Given a discount rate, d, estimate the present discounted value (pdv) of the 

3330 stream of costs from the age at diagnosis, a, to a preset age (99). 

3331 o Estimate COI conditional only on age at diagnosis:.

3332  Obtain probabilities of diagnosis of nasopharyngeal cancer at each stage of the cancer. 

3333  Using these probabilities, calculate the expected pdv, now conditional only on age at 

3334 diagnosis. 

3335 

3336 The methods at each step are described in detail in the sections below and are shown 

3337 schematically in Figure 3-2. 
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3338 

Figure 3-2: Summary of Cost of Illness Method 

3339 
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May 1, 2013 3-21 

3340 3.4.2.2 Treatment profile for non-fatal nasopharyngeal cancer 

3341 

3342 The first step in estimating the costs associated with a cancer is to develop a profile of the illness 

3343 – i.e., a description of the medical procedures that are performed as a result of the illness, and the 

3344 recommended frequency and estimated duration of each procedure in the year of diagnosis of the illness 

3345 and in each subsequent year. 

3346 

3347 This section provides an overview of the treatment profile for (non-fatal) nasopharyngeal cancer 

3348 in the United States. According to the American Cancer Society, nasopharyngeal carcinoma includes 

3349 three types of cancer: keratinizing squamous cell carcinoma, non-keratinizing differentiated carcinoma, 

3350 and undifferentiated carcinoma. Most cases in the United States are keratinizing squamous cell 

3351 carcinoma, while other types are more common in other parts of the world (American Cancer Society 

3352 2011b). The risk of nasopharyngeal cancer increases with age; this cancer is rarely found in children 

3353 under the age of 18 years (American Cancer Society 2011b; Lou, et al. 2010). 

3354 

3355 Diagnosis and initial treatments: procedures 

3356 

3357 The year in which the cancer is diagnosed includes diagnosis and initial treatment. Diagnostic 

3358 procedures include: medical history and physical exam, biopsy, imaging tests, and blood tests (American 

3359 Cancer Society 2011b ). Specifically, the type of biopsy is usually an endoscopic biopsy and imaging 

3360 tests include both a CT scan and an MRI (Lo and Lu 2010; Lou, et al. 2010). Since a majority of patients 

3361 with nasopharyngeal cancer have been shown to have an elevated level of an Epstein-Barr virus (EBV) 

3362 antibody, the blood tests to diagnose this cancer involve EBV-specific serology (Lo and Lu 2010). 

3363 

3364 Treatment generally does not vary by type of nasopharyngeal cancer, but differs by stage at which 

3365 the cancer is diagnosed (American Cancer Society 2011b). The analysis assumed that the distribution of 

3366 all nasopharyngeal cancer diagnoses by stage of illness applies to formaldehyde-related nasopharyngeal 

3367 cancer patients as well. Table 3-3 presents a description of each stage, the percent of nasopharyngeal 

3368 cancer cases diagnosed at each stage, and long-term (ten-year) relative survival rates. Relative survival 

3369 rates indicate the proportion of cases diagnosed at each stage who survive for a given number of years 

3370 after diagnosis, adjusting for other causes of death. Most cases of nasopharyngeal cancer are diagnosed at 

3371 Stages III or IV (Piccirillo, et al. 2007). 

3372 

3373 

Table 3-3: Stages of Nasopharyngeal Cancer at Diagnosis

Stage of Cancer at 

Diagnosis 

Description Cases Diagnosed

(%) 

Long-Term Relative 

Survival Rate (%) 

Stage I Tumor is confined to the nasopharynx. 15.0 62.6 

Stage II Tumor has spread to tissues of the left or right sides of the upper 

part of the throat, and/or has spread to nearby lymph nodes. 

6.7 51.6 

Stage III Tumor has spread to the sinuses or bones near the nasopharynx, 

or has spread to nearby lymph nodes. 

21.8 46.2 

Stage IV Tumor has grown into the skull and/or cranial nerves, the 

hypopharynx, the eye, or its nearby tissues; has spread to lymph 

nodes that are larger than 6 cm across or are located in the 

shoulder area above the collarbone; and/or has spread to distant 

sites. 

45.3 37.1 

Unknown Information is insufficient to indicate a stage. 11.2 44.6 

Sources: American Cancer Society 2011b; Piccirillo, et al. 2007. 

3374 

3375 Due to difficulties in operating on the nasopharynx and the effectiveness of other types of 

3376 treatment, surgery is not a main treatment option for nasopharyngeal cancer (American Cancer Society 

3377 2011b). Prior to the landmark Intergroup 0099 trial, as published by Al-Sarraf et al. (2010n), the primary 
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May 1, 2013 3-22 

3378 treatment option for all patients with nasopharyngeal cancer was radiation therapy. However, the 

3379 Intergroup 0099 trial on Stage III and IV cancers changed the way in which locally advanced stages of 

3380 nasopharyngeal cancer are treated (Cooper 2010). In this trial, radiation therapy was administered 

3381 concurrently with chemotherapy for a total of seven weeks, followed by adjuvant chemotherapy over 

3382 approximately eight weeks, with the doses and treatment schedules presented in Table 3-4 (U.S. Census 

3383 Bureau 2010n; Cooper 2010). Patients receiving this prescribed course of treatment experienced a 

3384 statistically significant (p=0.005) improvement in overall survival, compared with patients who received 

3385 radiation therapy alone (Al-Sarraf, et al. 1998U.S. Census Bureau 2010n). 

3386 

3387 

Table 3-4: Dosages of Radiation Therapy and Chemotherapy in the Intergroup 0099 Trial

Therapy Site/Method Drug Dosage Schedule 

Radiation Primary tumor N/A 70 Gy 1.8-2 Gy per day, Monday through Friday 

Affected lymph nodes 66-70 Gy 

Uninvolved lymph nodes 50 Gy 

Chemotherapy Rapid (15-20 minutes) 

intravenous infusion 

Cisplatin 100 mg/m2 Days 1, 22, and 43 of radiotherapy 

Cisplatin 80 mg/m2 Days 71, 99, and 127 

96-hour infusion 5-fluorouracil 1,000 mg/m2/day Days 71-74, 99-102, and 127-130 

Sources:U.S. Census Bureau 2010n; Cooper 2010.

One gray (Gy) is the absorption of one joule of energy, in the form of ionizing radiation, divided by one kilogram of matter. 

Radiation sessions take 15 to 30 minutes and are typically given five days a week for one to ten weeks (American Cancer Society 2011c).

3388 

3389 Hence, while radiation therapy is still the primary treatment option for early stage nasopharyngeal 

3390 cancer, chemotherapy combined with radiation therapy (known as “chemoradiation”) is currently the 

3391 recommended treatment for later stages of this cancer (American Cancer Society 2011b). Stage I cancers 

3392 are treated with radiation therapy aimed at the nasopharyngeal tumor and nearby lymph nodes, as a 

3393 preventive measure (American Cancer Society 2011b). Patients diagnosed with Stage II, III, IVA, or IVB 

3394 cancer are included in the group of locally advanced cancers that are treated with chemoradiation and 

3395 adjuvant chemotherapy (American Cancer Society 2011b). In addition, the American Cancer Society 

3396 provides a separate treatment profile for Stage IVC cancer, which is characterized by distant metastasis. 

3397 However, since cancer with distant metastasis usually is not curable (Lin 2010), it was assumed that all 

3398 patients with Stage IV cancers who survive (and are therefore included in the analysis of non-fatal cases) 

3399 receive the treatment profile for Stages IVA and IVB. 

3400 

3401 Given this information on the dosages and schedule from the Intergroup 0099 trial from the 

3402 American Cancer Society, the analysis developed the following profile for initial treatment of non-fatal 

3403 nasopharyngeal cancer: 

3404 

3405  Diagnosis at Stage I: Radiation therapy to the primary tumor and uninvolved lymph 

3406 nodes. 

3407  Diagnosis at Stage II, III or IV: Radiation therapy to the primary tumor and affected 

3408 lymph nodes; concurrent and adjuvant chemotherapy with cisplatin; and adjuvant 

3409 chemotherapy with 5-fluorouracil (5-FU). 

3410 

3411 After treatment, the maintenance phase begins. This phase consists of follow-up treatment, which 

3412 is presented by Tham and Lu (2010) as an evidence-based follow-up schedule and regimen that draws 

3413 from the recommendations of professional organizations (including the National Comprehensive Cancer 

3414 Network and the American Head and Neck Society). The following profile of follow-up treatment for 

3415 nasopharyngeal cancer is recommended for all patients treated with radiation therapy: 

3416 

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3417  Physical exams to check for signs of cancer recurrence: every one to three months for the 

3418 first year after treatment, every two to four months in the second year, every four to six 

months in years three to five post-treatment, then every six to twelve months thereafter.40 3419 

 Thyroid function screening tests41 3420 (i.e. thyroid-stimulating hormone and free thyroxine 

3421 tests): every six to twelve months. 

3422  MRI of the head and neck: three months after radiation therapy, then annually. 

3423 

3424 A dental evaluation, smoking cessation counseling, and patient support groups may also be 

3425 recommended (Tham and Lu 2010). However, since these treatments are recommended on an individual 

3426 basis and information on the proportion of patients who receive these treatments is not available, they 

3427 were not included in this analysis. 

3428 

3429 Frequencies and durations of treatments 

3430 

3431 To estimate the amount of time lost by an individual diagnosed with nasopharyngeal cancer in 

3432 each year, the analysis first estimated time values for each procedure carried out during each year outlined 

3433 in the treatment profile. The treatment profile outlines the frequency of procedures in the year of 

3434 diagnosis and all subsequent years. Treatment frequency also varies by stage of the illness (i.e., Stages I – 

3435 IV), though some treatments are common to all stages. 

3436 

3437 Three components of lost time were estimated for each treatment procedure: the time taken for 

3438 the procedure, the time spent waiting before and after the procedure, and the travel time to and from the 

3439 facility where the procedure is carried out. Wait and travel times were assumed to be twenty and forty3440 five minutes, respectively. The opportunity costs associated with the time it takes for patients to recover 

3441 from the treatments were excluded from the analysis because data on the duration of recovery times 

3442 associated with these treatments were not readily available. Thus, this omission introduces a downward 

3443 bias to the extent to which recovery time results in lost work time, lost time available for performing 

3444 domestic chores, and lost leisure time. 

3445 

3446 The entire treatment profile, including the diagnostic and recommended treatment procedures, 

3447 and the estimated durations of each, are detailed in Table 3-5 and Table 3-6. Table 3-5 gives the 

3448 breakdown of estimated wait times, travel times (to and from the locations of the treatments), and times 

3449 per visit. Table 3-6 gives the frequency and total time associated with each medical procedure, separately 

3450 for the year of diagnosis and subsequent years. The medical and opportunity costs associated with these 

3451 procedures are described in the subsections below. 

3452 

 40 The estimation of medical costs, uses the midpoint of all ranges for the frequency of each medical procedure or service 

in the treatment profile. 

41 Thyroid function tests are recommended because research indicates a high incidence of hypothyroidism in patients who 

have received radiation therapy to the entire neck (National Cancer Institute 2011c), which is typical in the treatment of 

nasopharyngeal cancer (Lo and Lu 2010). 
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Table 3-5: Estimated Lost Time (in Minutes) Per Visit Per Treatment Procedure

Procedure Procedure Time

Wait Timei 

Travel Time 

(Round Trip)j Total Time Per 

Visit 

Diagnosis: All Stages at Diagnosis

Medical history and physical exama 20 20 45 85

Biopsy (endoscopic or fine needle aspiration) 20 20 45 85

Imaging tests: CT scanb 10 20 45 75

Imaging tests: MRIc 60 20 45 125

Epstein-Barr virus (EBV) specific serology (blood test) 5 0d 0d 5

Treatment: Stage I at Diagnosis

Radiation therapy sessionse 30 20 45 95

Treatment: Stage II, III, or IV at Diagnosis 

Radiation therapy sessionse 30 20 45 95

Chemotherapy with cisplatinf 20 20 45 85

Chemotherapy with 5-fluorouracilg 3,840 0h 45 3,885

Follow-Up Care: All Stages at Diagnosis 

Physical exama 20 20 45 85

Laboratory tests for thyroid levels 5 0d 0d 5

MRI of the head and neckc 60 0d 0d 60

Note that the initial phase of treatment for all stages-at-diagnosis of nasopharyngeal cancer includes diagnosis and treatment, while the 

maintenance phase consists of follow-up care. 

Notes: 

a. Average time spent with physician was 20.9 minutes in 2005 (Abbo, et al. 2008Personal Communication with AWI 2010). 

b. Procedure takes a few minutes (Mayo Clinic 2010a2010b). 

c. Procedure takes less than an hour (Mayo Clinic 2010a). 

d. Assumed to be included in time lost for other procedures. 

e. Session takes 15 to 30 minutes (American Cancer Society 2011a2011c). 

f. Rapid infusion of cisplatin takes 15 to 20 minutes (Cooper 2010). 

g. Chemotherapy with 5-fluorouracil is given as a 96-hour infusion (U.S. Census Bureau 2010n; Cooper 2010 ), which implies a 4-day

hospital stay. 

h. No wait time assumed for overnight stay. 

i. Press Ganey Associates, Inc. (2010) reported an average wait time of 21 minutes for internal medicine and 22 minutes for family 

practice in 2009. 

j. Based on Federal Highway Administration (2011) data, the average one-way travel time for medical/dental reasons was 

approximately 23.15 minutes in 2009.

3453 

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Table 3-6: Estimated Total Lost Time (in Minutes), by Treatment Procedure

Procedure 

Frequency in 

First Year 

Frequency 

Subsequent 

Years 

Total Time 

(First Year) 

Total Time 

(Subsequent 

Years) 

Diagnosis: All Stages at Diagnosis 

Medical history and physical exam 1 0 85 0 

Biopsy (endoscopic or fine needle aspiration) 1 0 85 0 

Imaging tests: CT scan 1 0 75 0 

Imaging tests: MRI 1 0 125 0 

Epstein-Barr virus (EBV) specific serology (blood test) 1 0 5 0 

Subtotal 375 0

Treatment: Stage I at Diagnosis 

Radiation therapy sessions 35 0 3,325 0 

Subtotal 3,325 0

Treatment: Stage II, III, and IV at Diagnosis 

Radiation therapy sessions 35 0 3,325 0 

Chemotherapy with cisplatin 6 0 510 0 

Chemotherapy with 5-fluorouracil 3 0 11,655 0 

Subtotal 15,490 0

Follow-Up Care: All Stages at Diagnosis

Physical exam 3 1.7 255 434 

Laboratory tests for thyroid levels 1 1.5 5 8 

MRI of the head and neck 1 1 60 60 

Subtotal 320 501

Note that the initial phase of treatment for all stages-at-diagnosis of nasopharyngeal cancer includes diagnosis and treatment, while the 

maintenance phase consists of follow-up care.

3454 

3455 3.4.2.3 Estimated medical costs in the year of diagnosis and in subsequent years 

3456 

3457 This section describes the calculation of mean medical expenditures for each procedure and 

3458 service in the treatment profile, as well as the estimation of expected medical costs of illness for (non3459 fatal) nasopharyngeal cancer in the year of diagnosis and in subsequent years. For the average cost of 

3460 each procedure, the analysis relied on two data sources provided by the Agency for Healthcare Research 

3461 and Quality (AHRQ): the Medical Expenditure Panel Survey (MEPS) (Personal Communication with 

3462 CPA 2011) and Healthcare Cost and Utilization Project (HCUP) (Personal Communication with 

3463 Evergreen Engineering 2009). Note that mean expenditures from MEPS and HCUP are converted to 2010 

3464 dollars using the Bureau of Labor Statistics’ Consumer Price Index for medical care. 

3465 

3466 The Household Component of MEPS includes separate data files for types of medical events 

3467 (e.g., office-based medical provider visits, outpatient visits, and hospital inpatient stays), which provide 

3468 information on the expenditures for specific events for a nationally representative sample of families and 

3469 individuals. The data files include variables that indicate the conditions with which a patient has been 

3470 diagnosed and the procedures undergone during a particular medical event. ICD-9-CM (International 

3471 Classification of Diseases, Ninth Revision, Clinical Modification) codes are used to identify specific 

3472 diseases and procedures. In addition, some data files include variables that indicate any services that 

3473 patients received during their visit (e.g., laboratory tests, chemotherapy, and CT scan or MRI). 

3474 

3475 The analysis used the MEPS outpatient visit and office-based provider visit event files for 1996-

3476 2007 for all procedures and services in the treatment profile, except chemotherapy with 5-fluorouracil. 

3477 Since chemotherapy with 5-fluorouracil involves a 96-hour infusion, the analysis assumed that this 

3478 service is provided during an inpatient hospital stay; 2009 data on this specific procedure from HCUPnet, 

3479 the online query system of HCUP, were used to estimate the mean cost of the procedure. 

3480 
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3481 For each procedure and service for which there are sufficient observations in both the outpatient 

3482 visits and office-based medical provider visits event files, the mean estimates across the two files were 

3483 pooled, following the approach of DerSimonian and Laird (1986). The method for pooling is described in 

3484 detail in Appendix L of the BenMAP user manual (Abt Associates Inc. 2010). It is described briefly here. 

3485 

3486 The first step in pooling is to calculate a pooled estimate under the assumption of a fixed effects 

3487 model – i.e., that the different samples are both from the same population, and the only reason the sample 

3488 means differ is because of sampling error. This pooled estimate is a weighted average of the individual 

3489 sample means, where the weights are the corresponding inverse variances divided by the sum of the 

3490 inverse variances. The next step is to test for homogeneity of the mean expenditures across the two event 

3491 types (outpatient visits and office-based medical provider visits). The test statistic is the weighted sum of 

3492 squares of the differences between each mean estimate and the pooled estimate calculated in the first step, 

3493 where the weights are the inverse variances of the mean estimates. If the test indicates that the mean 

3494 expenditures are homogeneous (i.e., the fixed effects model is correct), then the pooled estimate 

3495 calculated on the first step is used. If the test indicates that the mean expenditures are not homogeneous, a 

3496 random effects model is used. To do this, a between-event type variance is first calculated. The pooled 

3497 estimate based on the random effects model is calculated in almost the same way as under the fixed 

3498 effects model; however, the weights now incorporate both the within-event type variance and the 

3499 between-event type variance. 

3500 

3501 Diagnosis 

3502 

3503 Diagnosis includes medical history and a physical exam, an endoscopic biopsy, a CT scan, an 

3504 MRI, and EBV-specific serology. The analysis assumed that doctor visits for physical examinations 

3505 include medical history. The cost of a physical exam was estimated as the mean expenditure by all 

3506 individuals who had a physical examination only (ICD-9-CM procedure code 89). 

3507 

3508 For the endoscopic biopsy, the analysis first investigated MEPS data on the ICD-9-CM procedure 

3509 code for operations on the pharynx (ICD-9-CM procedure code 29), which includes pharyngeal biopsies. 

3510 However, since there are very few observations for operations on the pharynx, the analysis used the 

3511 procedure codes for operations on the nose and nasal sinuses (ICD-9-CM procedure codes 21 and 22). 

3512 These codes include both surgical and diagnostic procedures, with the diagnostic procedures primarily 

3513 consisting of biopsies. The type of biopsy used to diagnose nasopharyngeal cancer does not involve 

3514 surgery (Lo and Lu 2010), so observations with surgeries were excluded, and the mean expenditures for 

3515 the remaining observations with procedure codes 21 and 22 was calculated. 

3516 

3517 The MEPS event files for outpatient and office-based provider visits include a variable that 

3518 indicates whether a particular medical event included a CT scan or MRI. Since these two services are 

3519 bundled together in the MEPS variable, it was assumed that the cost for a CT scan is equal to the cost for 

3520 an MRI. Due to a lack of data on a CT scan or MRI for patients with head and neck cancers, mean 

3521 expenditures were calculated for MRI or CT scans for patients with a diagnosis of “symptoms involving 

3522 the head and neck” (ICD-9-CM diagnosis code 784). 

3523 

3524 EBV-specific serologic testing is the preferred method to diagnose EBV infections (National 

3525 Center for Infectious Diseases 2006). Therefore, for this service, the analysis calculated the mean 

3526 expenditures for outpatient and office-based visits for which the only service provided was a laboratory 

3527 test and the individual’s only diagnosis is EBV (ICD-9-CM diagnosis code 075). 

3528 

3529 

3530 

3531 
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May 1, 2013 3-27 

3532 Treatment 

3533 

3534 Treatment for all patients includes radiation therapy. Because nasopharyngeal cancer is relatively 

3535 rare in the United States, there are no records for this specific illness in MEPS. Because pairwise t-tests 

3536 found significant differences in mean expenditures for radiation therapy across different cancer types, the 

3537 analysis estimated the mean per-session expenditure for radiation therapy for cancer types that are 

3538 primarily treated with the radiation treatment used for treating nasopharyngeal cancer – external beam 

radiation therapy (EBRT) (American Cancer Society 2011a, b).42 3539 This approach seems reasonable 

3540 because radiation therapy costs depend on the type of radiation therapy and the number of sessions 

3541 (American Cancer Society 2011c).). The analysis considered using MEPS data on expenditures for head 

3542 and neck cancers, but there are too few observations in the MEPS database on these diseases. Of the 

3543 observations for radiation therapy for a malignant neoplasm of unspecified parts of the mouth (one of 

3544 only two types of head and neck cancer included in the MEPS office-based visits file), there are only 36 

3545 observations, 35 of which are for one individual’s doctor visits. 

3546 

3547 Treatment for Stages II, III, and IV includes chemotherapy with the drugs cisplatin and 5-

3548 fluorouracil. The cost of chemotherapy depends on a number of factors, including the drugs used and the 

3549 frequency and method of treatment (American Cancer Society 2010). The analysis accounted for variation 

3550 in costs due to frequency by using per-visit expenditures for outpatient or office-based visit costs. For 

3551 cisplatin, the method of treatment is not a factor because this drug is always given intravenously (Medline 

3552 Plus 2009). Due to a lack of data on nasopharyngeal cancer, the analysis estimated chemotherapy costs by 

3553 using expenditures for chemotherapy during outpatient and office-based visits for other cancer types 

treated with the same drug, cisplatin, as listed by the National Cancer Institute (2011a).43 3554 There are no 

3555 significant differences (based on pairwise t-tests) within each MEPS event file in the average 

3556 expenditures for chemotherapy across the cancer types that are treated with cisplatin and have sufficient 

3557 observations (>30). Thus, the analysis assumed that the cost of chemotherapy with cisplatin for 

3558 nasopharyngeal cancer equals the average cost for chemotherapy using this drug for these other cancer 

3559 types. 

3560 

3561 The first approach considered for estimating the cost of adjuvant chemotherapy with 5-

3562 fluorouracil (5-FU) was to compare expenditures in MEPS for chemotherapy during inpatient hospital 

3563 stays across cancer types treated with this drug, as listed by the National Cancer Institute (2011b). 

3564 However, since there are significant differences in average expenditures across cancer types, it cannot be 

3565 assumed that the cost of chemotherapy with 5-fluorouracil for nasopharyngeal cancer is equal to the mean 

3566 expenditures for chemotherapy for these cancers. Instead, the analysis used 2009 data from HCUPnet to 

3567 obtain the mean hospital charge and cost for infusions of cancer chemotherapeutic substances (ICD-9-CM 

3568 procedure code 99.25). The mean cost provided by HCUPnet is intended to reflect the actual costs for 

3569 hospital stays and is estimated using a cost-to-charge ratio (Personal Communication with Evergreen 

Engineering 2009).44 3570 However, application of these ratios often results in an underestimation of costs for 

3571 stays where a large percentage of charges are for room and board (Personal Communication with 

3572 Evergreen Engineering 2009), which seems likely for chemotherapy treatments. In contrast, for a variety 

3573 of reasons hospital charges typically overstate actual medical expenditures, often substantially (Personal 

 42 The cancer types that are treated with EBRT and included in the MEPS data are: malignant neoplasm of unspecified 

parts of the mouth; malignant neoplasm of other and ill-defined parts of lip, oral cavity, and pharynx; esophagus cancer; 

colorectal cancer; laryngeal cancer; lung cancer; basal and squamous cell skin cancer; breast cancer; cervical cancer; 

testicular cancer; bladder cancer; brain cancer; thyroid cancer; and multiple myeloma. 

43 The cancer types that are treated with cisplatin and included in the MEPS data are: malignant neoplasm of other and illdefined parts of lip, oral cavity, and pharynx; lung cancer; cervical cancer; testicular cancer; and bladder cancer. 

44 AHRQ calculates cost-to-charge ratios using hospital-specific accounting information from the Centers for Medicare 

and Medicaid Services (Personal Communication with Evergreen Engineering 2009). Hospital-specific information is 

necessary because detailed charges are not available in all states. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-28 

3574 Communication with HPVA 2011b). Therefore, the analysis adjusted this charge estimate downward 

3575 using MEPS, which provides both charges and expenditures, to calculate the ratio of expenditures to 

3576 charges for inpatient hospital stays for treatment or therapy for all types of cancer. On average, the cost of 

3577 these procedures is 63.97 percent of the charge for them. This percentage was applied to the hospital 

3578 charges from HCUPnet to estimate the mean expenditures for a hospital stay for a chemotherapy infusion. 

3579 

3580 Follow-up care 

3581 

3582 Follow-up care consists of a physical exam, laboratory tests for thyroid levels, and an MRI of the 

3583 head and neck. The estimation of average costs of a physical exam and an MRI of the head and neck is 

3584 described above. The thyroid tests that are used to monitor the thyroid levels of individuals with 

3585 hypothyroidism are thyroid stimulation hormone and thyroxine tests (PubMed Health 2010). These are 

3586 also the thyroid function tests recommended for follow-up care of nasopharyngeal cancer. Hence, the 

3587 analysis calculated the average expenditure of outpatient and office-based visits for which the only 

3588 service was a laboratory test and the individual’s only diagnosis is hypothyroidism (ICD-9-CM diagnosis 

3589 code 244). 

3590 

3591 Expected medical costs of nasopharyngeal cancer 

3592 

3593 Using the treatment profile and mean medical expenditures from MEPS and HCUPnet, the 

3594 analysis estimated expected medical costs of hospital inpatient stays and outpatient and office-based visits 

3595 for individuals diagnosed with Stage I nasopharyngeal cancer (Table 3-7) and those diagnosed with Stage 

3596 II, III, or IV I nasopharyngeal cancer (Table 3-8). These expected costs include those incurred during the 

3597 year of diagnosis and in each subsequent year. 

3598 

Table 3-7: Expected Medical Costs for Stage I (Non-Fatal) Nasopharyngeal Cancer (2010$)

Treatment Phase Event Unit Cost in First Year Unit Cost in Subsequent 

Years 

Outpatient and Office-Based Provider Care 

Initial Diagnosis $2,086 $0 

Treatment: Radiation therapy $14,424 $0 

Maintenance Follow-up care $1,446 $1,337 

Total $17,955 $1,337

3599 

Table 3-8: Expected Medical Costs for Stages II, III, and IV of (Non-Fatal) Nasopharyngeal Cancer 

(2010$) 

Treatment Phase Treatment Type Unit Cost in First Year Unit Cost in Subsequent 

Years 

Inpatient Care

Initial Treatment: Chemotherapy with 5-fluorouracil $88,184 $0 

Outpatient and Office-Based Provider Care 

Initial Diagnosis $2,086 $0 

Treatment: Radiation therapy $14,424 $0 

Treatment: Chemotherapy with cisplatin $4,095 $0 

Maintenance Follow-up care $1,446 $1,337 

Total $110,234 $1,337

3600 

3601 3.4.2.4 Estimated opportunity costs in the year of diagnosis and in subsequent years 

3602 

3603 In addition to medical costs, cancer patients also incur opportunity costs – i.e., the value of time 

3604 lost to treating the illness. The analysis identified three categories of activity – work, leisure, and 

3605 housekeeping – that an individual could spend time on. 

3606 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-29 

3607 The expected value of an hour spent at work was calculated as the average total compensation 

3608 (wages plus employment benefits). This analysis values non-work time (both leisure time and time spent 

3609 on non-market activities, such as housekeeping) by assuming that “an individual will engage in such 

3610 unpaid activities only if, at the margin, the value of these activities is greater than the wages that could be 

3611 earned in paid employment. Hence after-tax wages provide a lower bound estimate of the value of non3612 work time. There are two different values for time considered in this analysis – one for time spent at 

3613 work and another for time spent at leisure or housekeeping activities – that were used to estimate the 

3614 opportunity cost associated with nasopharyngeal cancer. 

3615 

3616 Valuing any lost time of children can be difficult. However, based on the National Cancer 

3617 Institute’s Surveillance Epidemiology and End Results (SEER) database (SEER 2010), there are virtually 

3618 no cases of nasopharyngeal cancer among children, so this problem did not arise for this analysis. 

3619 

3620 The analysis assumed that full-time workers work 40 hours a week, for an average of 5.714 hours 

3621 per day (including weekends). It was assumed that everyone spends 8 hours sleeping, so the time spent in 

3622 leisure or housekeeping activities by the average full-time worker is estimated as 24 – 8 – 5.714 = 10.286. 

3623 If vwork denotes the value of an hour of work, and vleisure denotes the value of an hour of leisure or 

3624 housekeeping, then the expected value of a full day lost to nasopharyngeal cancer for a full-time worker is 

3625 . 

full time wor work leisure E (value of a full day ) 5.714 * v 10 .286 * v  ker   (17) 

3626 

3627 The analysis assumed that part-time workers work 20 hours a week, for an average of 2.857 hours 

3628 per day. Under this assumption, the time spent in leisure or housekeeping activities by the average part3629 time worker is 24 – 8 – 2.857 = 13.143. Thus the expected value of a full day lost to nasopharyngeal 

3630 cancer for a part-time worker is 

3631 . 

part time wor work leisure E (value of a full day ) 2.857 * v 13 .143 * v  ker   (18) 

3632 

3633 Finally, someone who is unemployed or retired would spend all 16 non-sleeping hours in 

3634 leisure or housekeeping activities. The expected value of a full day lost to nasopharyngeal cancer for an 

3635 unemployed or retired person, therefore, is 

3636 . 

unemployed retired leisure E (value of a full day ) 16 * v /  (19) 

3637 

3638 The BLS Labor Force Statistics Current Population Survey provides age group-specific 

3639 proportions of the U.S. non-institutionalized population that are (1) employed full time, (2) employed 

3640 part-time, (3) unemployed, and (4) retired. Using these proportions, the analysis constructed age-specific 

expected values of a full day lost to nasopharyngeal cancer. If p (a) i 3641 denotes the probability of being in 

3642 the ith employment status at age a, the expected value of a full day lost to nasopharyngeal cancer for 

3643 someone age a is: 

3644 

( ) ( ) * ( )

4

1

E value of a full day p a E value of a full day i

i

a  i



 (20) 

3645 

3646 where employment status is 

3647 

3648 full-time worker if i=1, 

3649 part-time worker if i=2, 

3650 unemployed if i=3, and 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-30 

3651 retired if i=4, 

3652 

3653 and the values for i=1, 2, 3, and 4 are given in equations (17) through (19) above. Table 3-9

3654 presents the age ranges provided by BLS for each employment status. 

3655 

Table 3-9: Age Ranges by Employment Status

Employment Status Age Group 

Full-time / Part-time 

16 – 17 

18 – 19 

20 – 24 

25 - 54 

55 + 

Unemployed / Retired 

16 – 17 

18 – 19 

20 – 24 

25 – 29 

30 – 34 

35 – 39 

40 – 44 

45 – 49 

50 – 64a

65 – 69 

70 – 74 

75 + 

a. Data for ages 55 – 64 were not available. This age range was assumed to 

have the same probabilities as for 50 – 54.

3656 

3657 To estimate the value of work time, average hourly wages were obtained for full-time and part3658 time workers in all occupations from the National Compensation Survey (U.S. Bureau of Labor Statistics 

3659 2011a). Hourly wages were $22.77 for full-time workers and $12.10 for part-time workers in 2010. 

3660 These wages were loaded with benefits obtained from BLS Employer Costs for Employee Compensation 

3661 data. Total benefits were estimated to be $10.05 for full-time workers and $3.35 for part-time workers 

3662 (U.S. Bureau of Labor Statistics 2011b). Therefore, total compensation used to estimate the value of 

3663 work time was $32.82 for a full-time worker and $15.45 for a part-time worker. 

3664 

3665 As noted above, the value of leisure time was estimated as after-tax wages. The analysis 

3666 estimated an average income tax rate by dividing national income from wages and salaries by the total 

3667 value of income taxes at the federal and state levels. According to the Bureau of Economic Analysis 

3668 (BEA) National Economic Accounts, wage and salary disbursements in 2010 were approximately $6.4 

3669 trillion (U.S. Bureau of Economic Analysis 2011a), and the value of federal income taxes withheld 

3670 (minus refunds) and state income taxes was approximately $1.5 trillion (U.S. Bureau of Economic 

3671 Analysis 2011b). The computed average tax rate – about twenty-three percent – was applied to the wages 

3672 for full-time and part-time workers, resulting in estimated after-tax wages of $17.46 and $9.28, 

3673 respectively. 

3674 

3675 Using equations (17), (18), and (19) given above, the expected full-day values for individuals 

3676 having each of the four employment statuses were calculated. These are shown in Table 3-10. 

3677 
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May 1, 2013 3-31 

Table 3-10: Expected Full-Day Values by Employment Status (2010$)

 Value of Work Value of Leisure 

Employment 

Status 

Work 

Hours / 

Day 

[A] 

Compensation / 

Hour 

[B] 

Work Value / 

Day 

[C] = [A] * [B] 

Leisure 

Hours / 

Day 

[D]

After-Tax 

Wages / 

Hour 

[E] 

Leisure Value / 

Day 

[F] = [D] * [E] 

Total Full Day 

Value 

[G] = [C] + [F] 

Full-Time 5.714 $32.82 $187.55 10.286 $17.46 $179.55 $367.10 

Part-Time 2.857 $15.45 $44.14 13.143 $9.28 $121.92 $166.06 

Unemployed 0.000 $0.00 $0.00 16.000 $9.28 $148.42 $148.42 

Not in Labor 

Force 0.000 $0.00 $0.00 16.000 $9.28 $148.42 $148.42 

Source:U.S. Bureau of Economic Analysis 2011a, b; U.S. Bureau of Labor Statistics 2011a, b 

3678 

3679 The probabilities of employment status at each age were then multiplied by the corresponding 

3680 expected full-day values in Table 3-10 (see equation (20)) to estimate the expected full-day value of an 

3681 individual at each age. These values are presented in Table 3-11. 

3682 

Table 3-11: Expected Full-Day Values by Age 

 Probability of Employment Status

Age Full Time Part Time Unemployed 

Not In Labor 

Force 

Expected Value of 

Full Day 

Expected Value 

Per Hour 

16-17 1.13% 12.23% 5.10% 81.54% $153.04 $9.57 

18-19 8.99% 26.25% 10.74% 54.02% $172.71 $10.79 

20-24 36.41% 23.02% 11.15% 29.43% $232.10 $14.51 

25-29 62.38% 9.90% 8.71% 19.01% $286.58 $17.91 

30-34 64.27% 10.20% 7.55% 17.98% $290.77 $18.17 

35-39 65.43% 10.38% 6.75% 17.44% $293.33 $18.33 

40-44 66.40% 10.53% 6.42% 16.65% $295.47 $18.47 

45-49 65.41% 10.38% 6.66% 17.55% $293.30 $18.33 

50-54 63.26% 10.04% 5.86% 20.85% $288.53 $18.03 

55-64 56.24% 17.06% 5.86% 20.85% $274.41 $17.15 

65-69 23.44% 7.11% 2.20% 67.25% $200.93 $12.56 

70-74 12.99% 3.94% 1.10% 81.96% $177.53 $11.10 

75+ 5.09% 1.54% 0.44% 92.93% $159.82 $9.99 

Source: U.S. Bureau of Economic Analysis 2011a, b; U.S. Bureau of Labor Statistics 2011a, b, c 

3683 

3684 As shown in Table 3-5 above, much of lost time associated with nasopharyngeal cancer consists 

3685 of partial rather than full days lost. Assuming that these lost hours are distributed across the two types of 

3686 activity (work and leisure) in the same proportions that these activities occur in a typical day for 

3687 individuals in each of the three employment status categories, an expected opportunity cost associated 

3688 with a given treatment is estimated as the number of hours lost as a result of the treatment times the 

3689 expected value per hour, shown in the right-most column of Table 3-11. The expected value per hour was 

3690 calculated by dividing the expected value of a full day by 16, since the assumption of 16 waking hours per 

3691 day underlies the expected value of a full day (see equations (17), (18), and (19)). Note that it is possible 

3692 that the assumption that lost hours are distributed across the two types of activity (work and leisure) in the 

3693 same proportions that these activities occur in a typical day may tend to lead toward an underestimate of 

3694 the benefits if full time workers are more likely to schedule treatments during working hours rather than 

3695 leisure hours. It is also worth noting that the opportunity cost estimates do not include work or leisure 

3696 time lost due to the side effects of chemotherapy, because there is wide variation in how individuals react 

3697 to treatments, and information could not be located on the typical or average recovery time from 

3698 chemotherapy. 

3699 

3700 

3701 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-32 

3702 3.4.2.5 Annual expected opportunity cost by age 

3703 

3704 Expected opportunity costs associated with nasopharyngeal cancer were estimated for the year in 

3705 which diagnosis occurs and for all subsequent years by multiplying the estimated number of hours lost in 

3706 the year (lost time is given in minutes in Table 3-6) times the expected value per hour lost, given in Table 

3707 3-11. Since the expected value of a lost hour varies by age, expected opportunity costs also vary by age. 

3708 In addition, since treatments differ by cancer stage at diagnosis, expected opportunity costs also differ by 

3709 stage at diagnosis. Table 3-12 gives age- and stage at diagnosis-specific opportunity costs, separately for 

3710 the year of diagnosis and subsequent years. 

3711 

Table 3-12: Total Expected Value of Time Lost Treating (Non-Fatal) Nasopharyngeal Cancer 

(2010$) 

 First Year Subsequent Years 

Age Stage I Stage II, III, and IV Stage I Stage II, III, and IV

16-17 $640.87 $2,580.20 $33.80 $33.80 

18-19 $723.20 $2,911.70 $38.14 $38.14 

20-24 $971.92 $3,913.07 $51.26 $51.26 

25-29 $1,200.06 $4,831.58 $63.29 $63.29 

30-34 $1,217.61 $4,902.23 $64.21 $64.21 

35-39 $1,228.32 $4,945.37 $64.78 $64.78 

40-44 $1,237.30 $4,981.50 $65.25 $65.25 

45-49 $1,228.19 $4,944.83 $64.77 $64.77 

50-54 $1,208.23 $4,864.46 $63.72 $63.72 

55-64 $1,149.07 $4,626.30 $60.60 $60.60 

65-69 $841.38 $3,387.48 $44.37 $44.37 

70-74 $743.42 $2,993.10 $39.21 $39.21 

75+ $669.24 $2,694.44 $35.29 $35.29 

Sources: 

Wages and Benefits from U.S. Bureau of Labor Statistics 2011a, b, c; Income and Tax information from U.S. Bureau of 

Economic Analysis 2011a, b; Average time with a physician from Personal Communication with AWI 2010; Time for 

chemotherapy with 5-fluorouracil from U.S. Census Bureau 2010n; Cooper 2010; Time for rapid infusion of cisplatin from 

Cooper 2010; Radiation therapy time from American Cancer Society 2011c; CT scan time fromMayo Clinic 2010b; MRI time 

from Mayo Clinic 2010a; MRI time from ; Average wait time based on Press Ganey Associates Inc. 2010; Average travel time 

based on Federal Highway Administration 2011.

3712 

3713 Consider the following example: the opportunity cost in the year of diagnosis for someone 

3714 diagnosed at age 60 with Stage III nasopharyngeal cancer would be calculated as follows: 

3715 

3716 Calculate total hours lost in year of diagnosis: 

3717 

3718 • Diagnosis (all stages at diagnosis) = 375 minutes = (375/60) hours = 6.25 hours 

3719 • First-year follow-up care (all stages at diagnosis) = 320 minutes = 320/60 hours = 5.33 hours 

3720 • First-year treatments (for Stages II, II, and IV at diagnosis) = 15,490 mins. = 258.17 hours 

3721 

3722 Therefore, total first-year hours lost = 6.25 + 5.33 + 258.17 = 269.75. 

3723 

3724 The expected value of a lost hour for someone age 60 is $17.15 (see Table 3-11). The estimated 

3725 opportunity cost in the year of diagnosis for someone diagnosed at age 60 with Stage III nasopharyngeal 

3726 cancer would be 

3727 269.75 hours x $17.15 per hour = $4,626. 

3728 

3729 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-33 

3730 3.4.2.6 Total expected cost of non-fatal nasopharyngeal cancer 

3731 

3732 Expected cost in the kth year after diagnosis, conditional on age and stage of cancer at diagnosis 

3733 

3734 If a person is diagnosed with nasopharyngeal cancer at age a and lives throughout the year of 

diagnosis, the total costs associated with the illness that year will be ( ) MC 1  OC a ,1 3735 , where MC1 denotes 

3736 the medical costs in the first year and OCa,1 denotes the opportunity costs in the first year for someone 

3737 diagnosed at age a. While these costs also depend on the stage of the cancer at diagnosis, for ease of 

3738 exposition, that is (temporarily) omitted here. 

3739 

3740 Although the analysis is considering only non-fatal cases of the cancer, people can still die of 

3741 other causes. If the cancer patient dies of other causes partway through the year, he will not incur all of 

( ) MC 1  OC a ,1 3742 . The analysis assumes that deaths from other causes occur uniformly throughout the 

3743 year and thus, on average, the expected cost associated with nasopharyngeal cancer for the first year 

among those who die of some other cause that year is ( ) 2 1 ,1 1 MC  OC a 3744 . 

3745 

3746 Survival probabilities were obtained from the Centers for Disease Control and 

Prevention/National Center for Health Statistics (2010b).45 3747 Since survival probabilities are age-specific, 

3748 age is inserted into the calculations here. 

3749 

3750 Suppose an individual is diagnosed with nasopharyngeal cancer at age a. Let spa denote the 

3751 probability of surviving from age a to age (a+1). Then the expected cost during the year of diagnosis of 

3752 nasopharyngeal cancer for an individual diagnosed at age a is: 

3753 

3754 

(cos ) * ( ) (1 ) * ( ) 2 1 ,1 1 a ,1 a 1 a ,1 a MC OC a E t  sp MC  OC   sp  (21) 

3755 

3756 

3757 Similarly, the expected cost associated with nasopharyngeal cancer for that individual during the 

3758 second year (at age a+1) is: 

3759 

3760 . 

(cos ) * ( ) (1 ) * ( ) 2 2 1,2 1 a 1,2  a 1 2  a 1,2   a 1 MC  OC a  E t sp MC OC sp (22) 

3761 

3762 In general, the expected cost associated with nasopharyngeal cancer during the kth year after 

3763 diagnosis (i.e., in year (k+1) of the cancer) for an individual diagnosed at age a is: 

3764 

(cos ) * ( ) (1 ) * ( ) 2 1 , 1 1 a  k ,k 1  a  k k 1  a  k ,k 1   a  k MC k   OC a  k k  E t sp MC OC sp (23) 

3765 

3766 For example, suppose an individual is diagnosed with Stage III nasopharyngeal cancer at age 

3767 60. The survival probability at age 60 (the probability of surviving from age 60 to age 61) is 0.990718. 

3768 Using the first-year medical cost from Table 3-8 ($110,234) and the first-year opportunity cost for 

3769 someone diagnosed with Stage III nasopharyngeal cancer at age 60 from Table 3-12 ($4,626), the total 

3770 expected cost in the first year is: 

3771 

 45 Having nasopharyngeal cancer may increase the probabilities of dying of other causes. However, because no such 

information was identified, this analysis uses general population survival probabilities. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-34 

(cos ) 0.990718 * ($110 ,234 $4,626 ) (1 0.990718 ) * ($110 ,234 $4,626 ) 2

1 E t 60 ,1     

= $114,327 

(24) 

3772 

3773 The age-specific expected costs in the first year (the year of diagnosis) and in subsequent years 

3774 for individuals diagnosed with Stage I nasopharyngeal cancer and at Stages II, III, or IV are shown in 

3775 Table 3-13. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-35 

Table 3-13: Annual Cost of (Non-Fatal) Nasopharyngeal Cancer (2010$)

 Diagnosed in Stage I Diagnosed in Stage II, III, IV 

Age at 

Diagnosis First Year Subsequent Years First Year Subsequent Years

16 $18,591 $1,370 $112,783 $1,370 

17 $18,590 $1,370 $112,777 $1,370 

18 $18,672 $1,374 $113,103 $1,374 

19 $18,671 $1,374 $113,099 $1,374 

20 $18,919 $1,387 $114,095 $1,387 

21 $18,918 $1,387 $114,091 $1,387 

22 $18,917 $1,387 $114,088 $1,387 

23 $18,917 $1,387 $114,087 $1,387 

24 $18,917 $1,387 $114,087 $1,387 

25 $19,146 $1,399 $115,007 $1,399 

26 $19,146 $1,399 $115,007 $1,399 

27 $19,146 $1,399 $115,008 $1,399 

28 $19,146 $1,399 $115,008 $1,399 

29 $19,146 $1,399 $115,007 $1,399 

30 $19,163 $1,400 $115,076 $1,400 

31 $19,163 $1,400 $115,074 $1,400 

32 $19,162 $1,400 $115,072 $1,400 

33 $19,162 $1,400 $115,069 $1,400 

34 $19,161 $1,400 $115,066 $1,400 

35 $19,171 $1,400 $115,106 $1,400 

36 $19,171 $1,400 $115,101 $1,400 

37 $19,170 $1,400 $115,095 $1,400 

38 $19,168 $1,400 $115,088 $1,400 

39 $19,167 $1,400 $115,079 $1,400 

40 $19,174 $1,400 $115,105 $1,400 

41 $19,173 $1,400 $115,096 $1,400 

42 $19,171 $1,400 $115,084 $1,400 

43 $19,169 $1,400 $115,072 $1,400 

44 $19,167 $1,400 $115,059 $1,400 

45 $19,155 $1,399 $115,009 $1,399 

46 $19,153 $1,399 $114,995 $1,399 

47 $19,150 $1,399 $114,980 $1,399 

48 $19,148 $1,399 $114,963 $1,399 

49 $19,145 $1,398 $114,945 $1,398 

50 $19,121 $1,397 $114,845 $1,397 

51 $19,118 $1,397 $114,823 $1,397 

52 $19,114 $1,397 $114,801 $1,397 

53 $19,110 $1,396 $114,778 $1,396 

54 $19,107 $1,396 $114,756 $1,396 

55 $19,044 $1,393 $114,496 $1,393 

56 $19,040 $1,392 $114,472 $1,392 

57 $19,035 $1,392 $114,444 $1,392 

58 $19,030 $1,392 $114,412 $1,392 

59 $19,024 $1,391 $114,374 $1,391 

60 $19,016 $1,391 $114,327 $1,391 

61 $19,007 $1,390 $114,274 $1,390 

62 $18,998 $1,389 $114,218 $1,389 

63 $18,989 $1,389 $114,164 $1,389 

64 $18,980 $1,388 $114,112 $1,388 

65 $18,665 $1,371 $112,826 $1,371 

66 $18,656 $1,371 $112,769 $1,371 

67 $18,645 $1,370 $112,703 $1,370 

68 $18,632 $1,369 $112,625 $1,369 

69 $18,617 $1,368 $112,536 $1,368 

70 $18,503 $1,361 $112,044 $1,361 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-36 

Table 3-13: Annual Cost of (Non-Fatal) Nasopharyngeal Cancer (2010$)

 Diagnosed in Stage I Diagnosed in Stage II, III, IV 

Age at 

Diagnosis First Year Subsequent Years First Year Subsequent Years

71 $18,484 $1,360 $111,929 $1,360 

72 $18,462 $1,358 $111,796 $1,358 

73 $18,437 $1,356 $111,643 $1,356 

74 $18,409 $1,354 $111,472 $1,354 

75 $18,304 $1,348 $110,987 $1,348 

76 $18,270 $1,346 $110,781 $1,346 

77 $18,233 $1,343 $110,555 $1,343 

78 $18,192 $1,340 $110,305 $1,340 

79 $18,147 $1,337 $110,032 $1,337 

80 $18,097 $1,333 $109,731 $1,333 

81 $18,043 $1,329 $109,401 $1,329 

82 $17,983 $1,325 $109,040 $1,325 

83 $17,918 $1,320 $108,644 $1,320 

84 $17,847 $1,315 $108,212 $1,315 

85 $17,769 $1,309 $107,741 $1,309 

86 $17,684 $1,303 $107,227 $1,303 

87 $17,592 $1,296 $106,669 $1,296 

88 $17,493 $1,288 $106,064 $1,288 

89 $17,385 $1,280 $105,410 $1,280 

90 $17,268 $1,272 $104,703 $1,272 

91 $17,142 $1,263 $103,941 $1,263 

92 $17,008 $1,253 $103,124 $1,253 

93 $16,863 $1,242 $102,249 $1,242 

94 $16,709 $1,231 $101,316 $1,231 

95 $16,546 $1,219 $100,323 $1,219 

3776 

3777 Present discounted value of costs conditional on age at diagnosis 

3778 

3779 Because cancer is a chronic illness, costs are incurred for a number of years. The COI-based 

3780 value of a cancer case is the pdv of the stream of expected costs associated with the illness, from the year 

3781 of diagnosis to the year of death of the patient (or a preset year). Since the analysis is considering only 

3782 non-fatal cases of nasopharyngeal cancer, death would be from some other cause. As shown in Table 

3783 3-13, expected first-year and subsequent-year costs (including medical costs and opportunity costs) were 

3784 calculated for each age at diagnosis, starting at age 16, separately for those diagnosed at Stage I and those 

3785 diagnosed at Stages II, III, or IV. Expected costs take into account the probability of dying of some other 

3786 cause at each age, as explained above. Denoting the discount rate as d, the pdv of a case of 

3787 nasopharyngeal cancer for an individual diagnosed at age a, conditional on a given stage-at-diagnosis, is 

3788 



 

 

M

k

k

a k k

a d

E t

pdv 0

, 1

(1 )

(cos ) (25) 

3789 

where , 1 (cos ) a  k k  3790 E t is given by equation (23) above. The sums of the expected costs were taken 

3791 through age 99. 

3792 

3793 While the dependence of cost on stage of the cancer at diagnosis has been omitted from 

3794 equations (23) and (25), cost does in fact depend on this, as shown in Table 3-13. The final step is to 

3795 calculate an expected pdv, where the expectation is taken over the stage at diagnosis. Using the 

3796 percentages of cases diagnosed at each stage given in Table 3-13 above, and assuming that the cases with 

3797 unknown stage at diagnosis have the same distribution of stages at diagnosis as the cases whose stages are 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-37 

3798 known, 16.89 percent of cases are diagnosed at Stage I and 83.11 percent are diagnosed at Stages II, III, 

3799 or IV. Table 3-14 shows the stage at diagnosis-specific pdvs, and the expected pdv, calculated as a 

3800 weighted average of the two stagestages at diagnosis-specific pdvs, where the weights are these 

3801 percentages, separately for each age at diagnosis. These pdvs are estimated for a 3 and a 7 percent 

3802 discount rate. The final column of Table 3-14 shows the implied values of a micro risk reduction (a risk 

3803 reduction of 1/1,000,000), which is just the expected pdv divided by 1,000,000. 

3804 

3805 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-38 

Table 3-14: Present Discounted Values of Nonfatal Nasopharyngeal Cancer by Age at Diagnosis

Age at 

Diagnosis 

3 Percent Discount Rate 7 Percent Discount Rate 

PDV for 

Diagnosis 

at Stage I 

PDV for 

Diagnosis at 

Stage II, III, or 

IV 

Expected 

PDV

Implied Value 

of a Micro 

Risk 

Reduction 

PDV for 

Diagnosis at 

Stage I 

PDV for 

Diagnosis at 

Stage II, III, 

or IV 

Expected 

PDV

Implied Value of

a Micro Risk 

Reduction 

16 $60,328 $154,520 $138,609 $0.139 $38,090 $132,282 $116,371 $0.116 

17 $60,207 $154,394 $138,484 $0.138 $60,207 $154,394 $138,484 $0.138 

18 $60,297 $154,728 $138,777 $0.139 $60,297 $154,728 $138,777 $0.139 

19 $60,169 $154,597 $138,646 $0.139 $60,169 $154,597 $138,646 $0.139 

20 $60,681 $155,857 $139,780 $0.140 $60,681 $155,857 $139,780 $0.140 

21 $60,544 $155,717 $139,640 $0.140 $60,544 $155,717 $139,640 $0.140 

22 $60,404 $155,575 $139,499 $0.139 $60,404 $155,575 $139,499 $0.139 

23 $60,262 $155,431 $139,355 $0.139 $60,262 $155,431 $139,355 $0.139 

24 $60,115 $155,285 $139,209 $0.139 $60,115 $155,285 $139,209 $0.139 

25 $60,638 $156,605 $140,394 $0.140 $60,638 $156,605 $140,394 $0.140 

26 $60,481 $156,448 $140,238 $0.140 $60,481 $156,448 $140,238 $0.140 

27 $60,320 $156,287 $140,076 $0.140 $60,320 $156,287 $140,076 $0.140 

28 $60,153 $156,120 $139,909 $0.140 $60,153 $156,120 $139,909 $0.140 

29 $59,980 $155,947 $139,736 $0.140 $59,980 $155,947 $139,736 $0.140 

30 $59,768 $155,693 $139,489 $0.139 $59,768 $155,693 $139,489 $0.139 

31 $59,585 $155,508 $139,305 $0.139 $59,585 $155,508 $139,305 $0.139 

32 $59,396 $155,317 $139,114 $0.139 $59,396 $155,317 $139,114 $0.139 

33 $59,202 $155,121 $138,918 $0.139 $59,202 $155,121 $138,918 $0.139 

34 $59,001 $154,917 $138,715 $0.139 $59,001 $154,917 $138,715 $0.139 

35 $58,774 $154,662 $138,464 $0.138 $58,774 $154,662 $138,464 $0.138 

36 $58,560 $154,444 $138,248 $0.138 $58,560 $154,444 $138,248 $0.138 

37 $58,340 $154,219 $138,023 $0.138 $58,340 $154,219 $138,023 $0.138 

38 $58,112 $153,985 $137,791 $0.138 $58,112 $153,985 $137,791 $0.138 

39 $57,877 $153,743 $137,549 $0.138 $57,877 $153,743 $137,549 $0.138 

40 $57,618 $153,455 $137,266 $0.137 $57,618 $153,455 $137,266 $0.137 

41 $57,368 $153,197 $137,010 $0.137 $57,368 $153,197 $137,010 $0.137 

42 $57,111 $152,930 $136,745 $0.137 $57,111 $152,930 $136,745 $0.137 

43 $56,846 $152,655 $136,471 $0.136 $56,846 $152,655 $136,471 $0.136 

44 $56,572 $152,370 $136,188 $0.136 $56,572 $152,370 $136,188 $0.136 

45 $56,307 $152,115 $135,932 $0.136 $56,307 $152,115 $135,932 $0.136 

46 $56,017 $151,813 $135,631 $0.136 $56,017 $151,813 $135,631 $0.136 

47 $55,718 $151,501 $135,322 $0.135 $55,718 $151,501 $135,322 $0.135 

48 $55,409 $151,179 $135,002 $0.135 $55,409 $151,179 $135,002 $0.135 

49 $55,091 $150,846 $134,671 $0.135 $55,091 $150,846 $134,671 $0.135 

50 $54,799 $150,584 $134,404 $0.134 $54,799 $150,584 $134,404 $0.134 

51 $54,460 $150,227 $134,050 $0.134 $54,460 $150,227 $134,050 $0.134 

52 $54,111 $149,860 $133,686 $0.134 $54,111 $149,860 $133,686 $0.134 

53 $53,752 $149,482 $133,312 $0.133 $53,752 $149,482 $133,312 $0.133 

54 $53,383 $149,094 $132,927 $0.133 $53,383 $149,094 $132,927 $0.133 

55 $51,727 $145,725 $129,847 $0.130 $51,727 $145,725 $129,847 $0.130 

56 $51,344 $145,321 $129,447 $0.129 $51,344 $145,321 $129,447 $0.129 

57 $50,948 $144,903 $129,032 $0.129 $50,948 $144,903 $129,032 $0.129 

58 $50,539 $144,467 $128,601 $0.129 $50,539 $144,467 $128,601 $0.129 

59 $50,115 $144,012 $128,151 $0.128 $50,115 $144,012 $128,151 $0.128 

60 $49,676 $143,535 $127,680 $0.128 $49,676 $143,535 $127,680 $0.128 

61 $49,222 $143,037 $127,190 $0.127 $49,222 $143,037 $127,190 $0.127 

62 $48,755 $142,524 $126,684 $0.127 $48,755 $142,524 $126,684 $0.127 

63 $48,275 $142,000 $126,168 $0.126 $48,275 $142,000 $126,168 $0.126 

64 $47,783 $141,465 $125,640 $0.126 $47,783 $141,465 $125,640 $0.126 

65 $47,833 $142,268 $126,316 $0.126 $47,833 $142,268 $126,316 $0.126 

66 $47,306 $141,693 $125,749 $0.126 $47,306 $141,693 $125,749 $0.126 

67 $46,760 $141,091 $125,157 $0.125 $46,760 $141,091 $125,157 $0.125 

68 $46,194 $140,461 $124,537 $0.125 $46,194 $140,461 $124,537 $0.125 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-39 

Table 3-14: Present Discounted Values of Nonfatal Nasopharyngeal Cancer by Age at Diagnosis

Age at 

Diagnosis 

3 Percent Discount Rate 7 Percent Discount Rate 

PDV for 

Diagnosis 

at Stage I 

PDV for 

Diagnosis at 

Stage II, III, or 

IV 

Expected 

PDV

Implied Value 

of a Micro 

Risk 

Reduction 

PDV for 

Diagnosis at 

Stage I 

PDV for 

Diagnosis at 

Stage II, III, 

or IV 

Expected 

PDV

Implied Value of

a Micro Risk 

Reduction 

69 $45,608 $139,800 $123,889 $0.124 $45,608 $139,800 $123,889 $0.124 

70 $45,171 $139,531 $123,592 $0.124 $45,171 $139,531 $123,592 $0.124 

71 $44,541 $138,804 $122,881 $0.123 $44,541 $138,804 $122,881 $0.123 

72 $43,888 $138,039 $122,135 $0.122 $43,888 $138,039 $122,135 $0.122 

73 $43,211 $137,234 $121,352 $0.121 $43,211 $137,234 $121,352 $0.121 

74 $42,510 $136,389 $120,531 $0.121 $42,510 $136,389 $120,531 $0.121 

75 $41,904 $135,811 $119,948 $0.120 $41,904 $135,811 $119,948 $0.120 

76 $41,154 $134,887 $119,054 $0.119 $41,154 $134,887 $119,054 $0.119 

77 $40,378 $133,920 $118,119 $0.118 $40,378 $133,920 $118,119 $0.118 

78 $39,577 $132,908 $117,143 $0.117 $39,577 $132,908 $117,143 $0.117 

79 $38,749 $131,848 $116,122 $0.116 $38,749 $131,848 $116,122 $0.116 

80 $37,893 $130,738 $115,055 $0.115 $37,893 $130,738 $115,055 $0.115 

81 $37,009 $129,575 $113,939 $0.114 $37,009 $129,575 $113,939 $0.114 

82 $36,097 $128,357 $112,772 $0.113 $36,097 $128,357 $112,772 $0.113 

83 $35,155 $127,080 $111,552 $0.112 $35,155 $127,080 $111,552 $0.112 

84 $34,183 $125,742 $110,276 $0.110 $34,183 $125,742 $110,276 $0.110 

85 $33,180 $124,341 $108,943 $0.109 $33,180 $124,341 $108,943 $0.109 

86 $32,148 $122,874 $107,549 $0.108 $32,148 $122,874 $107,549 $0.108 

87 $31,084 $121,339 $106,093 $0.106 $31,084 $121,339 $106,093 $0.106 

88 $29,990 $119,732 $104,573 $0.105 $29,990 $119,732 $104,573 $0.105 

89 $28,865 $118,053 $102,988 $0.103 $28,865 $118,053 $102,988 $0.103 

90 $27,710 $116,300 $101,336 $0.101 $27,710 $116,300 $101,336 $0.101 

91 $26,525 $114,472 $99,616 $0.100 $26,525 $114,472 $99,616 $0.100 

92 $25,312 $112,567 $97,828 $0.098 $25,312 $112,567 $97,828 $0.098 

93 $24,072 $110,586 $95,972 $0.096 $24,072 $110,586 $95,972 $0.096 

94 $22,805 $108,529 $94,049 $0.094 $22,805 $108,529 $94,049 $0.094 

95 $21,513 $106,398 $92,059 $0.092 $21,513 $106,398 $92,059 $0.092 

3806 

3807 

3808 3.4.3 Timing of Reduced Cancer Risk and Present Value of Reduced Cancer Risk at the 

3809 Time of the Exposure Reduction 

3810 

3811 The available studies that link formaldehyde exposure to cancer risk do not provide any 

3812 information about the latency periods between exposure and cancer incidence. Therefore, this analysis 

3813 relies on the assumption that the incidence of nasopharyngeal cancer caused by formaldehyde exposure 

3814 has the same distribution as the incidence of nasopharyngeal cancer from any cause. 

3815 

3816 The National Cancer Institutes’ Surveillance Epidemiology and End Results (SEER) 

3817 nasopharyngeal cancer incidence data included the number of cancer diagnoses for ten year age brackets 

3818 that ranged from ages 20 to 79 and also included an age bracket for age 80 and older (Ries, et al. 2007). 

3819 To estimate the timing of avoided cancer for a hypothetical person, it was assumed that the timing of 

3820 cancer diagnosis would follow the distribution between the age of exposure and the individual’s life 

3821 expectancy age. Table 3-15 presents an example of how this calculation is performed for individuals who 

3822 are age 50 at the time they experience a change in formaldehyde exposure that reduces their cancer risk. 

3823 Thus, conditional on avoiding a case of nasopharyngeal cancer because of an exposure reduction that 

3824 occurred at age 50, there is a 40.7 percent chance that the avoided cancer would have occurred between 

3825 ages 50 and 59, a 37.8 percent chance that it would have occurred between ages 60 and 69, a 21.0 percent 

3826 chance that it would have occurred between ages 70 and 79, and a 0.4 percent chance that it would have 

3827 occurred at age 80. Note that although the table presents these percentages for the age brackets for which 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-40 

3828 the incidence data were available, the analysis uses annual incidence rates estimated by assuming the 

3829 incidence rates are uniformly distributed within the age brackets for which they were reported. 

3830 

Table 3-15: Distribution of Timing of Avoided Cancer Risk: Example for a 

Reduction in Exposure Experienced at Age 50 

Age 

(1) 

Cancer Incidence 

Distribution 

(2) 

Timing of Avoided Cancer 

Riska 

(3) 

0-29 4.5% n.a. 

30-39 12.1% n.a. 

40-49 23.4% n.a. 

50-59 23.0% 40.7% 

60-69 21.4% 37.8% 

70-79 11.9% 21.0% 

80 3.7% 0.4% 

81+ n.a. 

Total 100% 100% a Calculated as column (2) divided by 56.6%, where 56.6% is the percentage of cancer 

death incidence between the ages of 50 and 81 (the ages that span from when the change 

in exposure was experienced through the end of the expected lifetime). 

Source: Ries, et al. 2007 

3831 

3832 3.4.3.1 Present Value of Reduced Cancer Risk at the Time of the Exposure Reduction 

3833 

3834 Once the distribution of the timing of the avoided cancer risk is estimated (see section 3.4.3), this 

3835 distribution can be applied to the estimated values of reduced cancer risk at the time the cancer is avoided. 

3836 Using the example presented above in section 3.4.3 an individual with an exposure reduction at age 50 

3837 has a 40.7% chance of realizing the benefit from that reduction between the ages of 50 and 59. This is 

3838 assumed to be uniformly distributed across the 10 years in that age range; therefore, there is a 4.7% 

3839 chance this individual realizes this benefit in each year between the ages 50 and 59. Thus, by multiplying 

3840 the probability that cancer is avoided in a given year by the value of the risk reduction discounted to the 

3841 year when the exposure reduction was experienced, the analysis can estimate the present value of reduced 

3842 cancer risk at the time of the exposure reduction. For an individual with a given age at exposure, this 

3843 calculation can be described with the following formula: 

3844 

௧ሻܥܨܸܰ ൈ ݈ܽݐܽܨ݊݋ܰݎܲ ൅ ܴܯܸ ൈ ݈ܽݐܽܨݎܲሺ ൈ ௧݅݀݁݀݋ݒܣݎܲ ෍ ൌ௔௘ ௧ୀ݊݋݅ݐܿݑܴ݇݁݀ݏܴ݅ݎܽ݊ܿ݁ܥܸܲ

ሺ1 ൅ ݀ሻሺ௧ାଵି௔௘ሻ

௅ா

௧ୀ௔௘

(26) 

3845 

3846 where: 

3847 

PVCancerRiskReductiont=ae is the present value of the reduced cancer risk at the time of the exposure reduction 

for individual age ae at the time of the exposure reduction. 

PRAvoidedt is the probability that reduction in cancer risk is realized in period t. This 

probability is conditional on the age at exposure. 

PrFatal is the probability that a case of nasopharyngeal cancer is fatal, 57.1 percent. 

VMR is the value of a micro mortality risk reduction, $8.01. 

PrNonFatal is the probability that a case of nasopharyngeal cancer is not fatal, 42.9 percent. 

VNFCt is the value of a micro risk reduction for nonfatal cancer diagnosed in period t, or 

1/1,000,000 of the value of an avoided case of nonfatal nasopharyngeal cancer. 

This value is conditional on the age at diagnosis. 

d is the 3 percent or 7 percent discount rate. 

3848 

3849 Table 3-16 presents the present values for micro risk reductions for fatal and nonfatal cancer, both 

3850 separately and combined, by the age at exposure. Note that the combined value for fatal and nonfatal 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-41 

3851 cancer is simply the average of the two separate values weighted according to the probability that cancer 

3852 is fatal, which is 57.1 percent of nasopharyngeal cases (SEER 2010). 

3853 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-42 

Table 3-16: Present Discounted Values for Nasopharyngeal Cancer by Age at 

Exposure 

Age at Exposure 

3 Percent Discount Rate 7 Percent Discount Rate 

PV of 

Micro Risk 

Reduction 

for Fatal 

Cancer 

PV of 

Micro Risk 

Reduction 

for 

Nonfatal 

Cancer 

PV of Micro 

Risk 

Reduction 

for Cancer 

(fatal and 

nonfatal)

PV of 

Micro Risk 

Reduction 

for Fatal 

Cancer 

PV of Micro 

Risk 

Reduction for 

Nonfatal 

Cancer

PV of 

Micro Risk 

Reduction 

for Cancer 

(fatal and 

nonfatal)

0 $1.809 $0.030 $1.0105 $0.333 $0.005 $0.19 

1 $1.850 $0.031 $1.0407 $0.352 $0.005 $0.20 

2 $1.919 $0.032 $1.0811 $0.381 $0.006 $0.2122

3 $1.963 $0.032 $1.1013 $0.403 $0.006 $0.23 

4 $2.019 $0.033 $1.1317 $0.430 $0.006 $0.2425

5 $2.082 $0.034 $1.1720 $0.461 $0.007 $0.2627

6 $2.145 $0.035 $1.2024 $0.494 $0.007 $0.2829

7 $2.209 $0.037 $1.2428 $0.528 $0.008 $0.30 

8 $2.275 $0.038 $1.2732 $0.565 $0.008 $0.3233

9 $2.343 $0.039 $1.3135 $0.605 $0.009 $0.3435

10 $2.414 $0.040 $1.3540 $0.647 $0.009 $0.3637

11 $2.486 $0.041 $1.3944 $0.693 $0.010 $0.3940

12 $2.561 $0.042 $1.4348 $0.741 $0.011 $0.4143

13 $2.637 $0.044 $1.4852 $0.793 $0.012 $0.4446

14 $2.717 $0.045 $1.5257 $0.848 $0.012 $0.4749

15 $2.798 $0.046 $1.5762 $0.908 $0.013 $0.5152

16 $2.882 $0.048 $1.6267 $0.971 $0.014 $0.5456

17 $2.969 $0.049 $1.6672 $1.039 $0.015 $0.5860

18 $3.058 $0.051 $1.7177 $1.112 $0.016 $0.6264

19 $3.149 $0.052 $1.7682 $1.190 $0.017 $0.6769

20 $3.222 $0.053 $1.8186 $1.244 $0.018 $0.7072

21 $3.297 $0.054 $1.8591 $1.301 $0.019 $0.7375

22 $3.375 $0.056 $1.8995 $1.363 $0.020 $0.7679

23 $3.455 $0.057 $1.942.00 $1.429 $0.021 $0.8083

24 $3.538 $0.058 $1.982.05 $1.501 $0.022 $0.8487

25 $3.624 $0.060 $2.0310 $1.577 $0.023 $0.8891

26 $3.713 $0.061 $2.0815 $1.659 $0.024 $0.9396

27 $3.805 $0.063 $2.1320 $1.747 $0.025 $0.981.01

28 $3.900 $0.064 $2.1925 $1.841 $0.027 $1.0306

29 $3.998 $0.066 $2.2431 $1.943 $0.028 $1.0912

30 $4.062 $0.067 $2.2835 $2.001 $0.029 $1.1216

31 $4.134 $0.068 $2.3239 $2.068 $0.030 $1.1619

32 $4.209 $0.069 $2.3643 $2.139 $0.031 $1.2023

33 $4.286 $0.070 $2.4048 $2.216 $0.032 $1.2428

34 $4.366 $0.071 $2.4552 $2.298 $0.033 $1.2933

35 $4.449 $0.073 $2.4957 $2.386 $0.035 $1.3338

36 $4.535 $0.074 $2.5462 $2.480 $0.036 $1.3943

37 $4.624 $0.075 $2.5967 $2.581 $0.037 $1.4449

38 $4.717 $0.077 $2.6473 $2.690 $0.039 $1.5155

39 $4.813 $0.078 $2.7078 $2.807 $0.041 $1.5762

40 $4.869 $0.079 $2.7381 $2.866 $0.042 $1.6065

41 $4.927 $0.080 $2.7685 $2.927 $0.042 $1.6469

42 $4.985 $0.081 $2.7988 $2.989 $0.043 $1.6773

43 $5.044 $0.081 $2.8392 $3.054 $0.044 $1.7176

44 $5.104 $0.082 $2.8695 $3.120 $0.045 $1.7580

45 $5.156 $0.083 $2.8998 $3.179 $0.046 $1.7883

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

May 1, 2013 3-43 

Table 3-16: Present Discounted Values for Nasopharyngeal Cancer by Age at 

Exposure 

Age at Exposure 

3 Percent Discount Rate 7 Percent Discount Rate 

PV of 

Micro Risk 

Reduction 

for Fatal 

Cancer 

PV of 

Micro Risk 

Reduction 

for 

Nonfatal 

Cancer 

PV of Micro 

Risk 

Reduction 

for Cancer 

(fatal and 

nonfatal)

PV of 

Micro Risk 

Reduction 

for Fatal 

Cancer 

PV of Micro 

Risk 

Reduction for 

Nonfatal 

Cancer

PV of 

Micro Risk 

Reduction 

for Cancer 

(fatal and 

nonfatal)

46 $5.217 $0.083 $2.923.01 $3.249 $0.047 $1.8288

47 $5.279 $0.084 $2.963.05 $3.320 $0.048 $1.8692

48 $5.341 $0.085 $2.993.09 $3.394 $0.049 $1.9096

49 $5.404 $0.086 $3.0312 $3.469 $0.050 $1.942.00

50 $5.469 $0.087 $3.0616 $3.549 $0.051 $1.992.05

51 $5.535 $0.087 $3.1020 $3.631 $0.052 $2.0310

52 $5.601 $0.088 $3.1424 $3.715 $0.053 $2.0814

53 $5.668 $0.089 $3.1727 $3.801 $0.054 $2.1319

54 $5.735 $0.090 $3.2131 $3.889 $0.055 $2.1824

55 $5.790 $0.090 $3.2434 $3.964 $0.056 $2.2229

56 $5.857 $0.091 $3.2838 $4.054 $0.058 $2.2734

57 $5.923 $0.092 $3.3242 $4.146 $0.059 $2.3239

58 $5.989 $0.092 $3.3546 $4.237 $0.060 $2.3745

59 $6.054 $0.093 $3.3950 $4.328 $0.061 $2.4250

60 $6.111 $0.093 $3.4253 $4.413 $0.062 $2.4755

61 $6.182 $0.094 $3.4657 $4.519 $0.064 $2.5361

62 $6.252 $0.095 $3.5061 $4.625 $0.065 $2.5967

63 $6.321 $0.095 $3.5465 $4.730 $0.066 $2.6573

64 $6.388 $0.096 $3.5869 $4.832 $0.067 $2.7079

65 $6.430 $0.096 $3.6071 $4.900 $0.068 $2.7483

66 $6.486 $0.096 $3.6375 $4.988 $0.069 $2.7988

67 $6.535 $0.097 $3.6677 $5.061 $0.070 $2.8392

68 $6.571 $0.097 $3.6879 $5.112 $0.070 $2.8695

69 $6.589 $0.096 $3.6980 $5.126 $0.070 $2.8796

70 $6.647 $0.097 $3.7284 $5.227 $0.071 $2.923.02

71 $6.736 $0.097 $3.7789 $5.377 $0.073 $3.0110

72 $6.824 $0.098 $3.8294 $5.531 $0.075 $3.0919

73 $6.912 $0.099 $3.8799 $5.687 $0.077 $3.1828

74 $6.999 $0.100 $3.924.04 $5.845 $0.079 $3.2737

75 $6.978 $0.098 $3.904.03 $5.823 $0.078 $3.2536

76 $7.039 $0.099 $3.944.06 $5.936 $0.079 $3.3242

77 $7.078 $0.098 $3.964.08 $6.009 $0.080 $3.3647

78 $7.066 $0.097 $3.954.08 $5.983 $0.079 $3.3445

79 $6.900 $0.093 $3.8698 $5.650 $0.074 $3.1626

80 $6.803 $0.090 $3.8092 $5.480 $0.070 $3.0616

81 $6.900 $0.091 $3.8698 $5.650 $0.072 $3.1626

82 $6.999 $0.092 $3.914.04 $5.828 $0.074 $3.2636

83 $7.100 $0.092 $3.974.09 $6.014 $0.076 $3.3647

84 $7.203 $0.093 $4.0215 $6.208 $0.078 $3.4758

85 $7.100 $0.090 $3.974.09 $6.014 $0.074 $3.3647

86 $7.100 $0.088 $3.974.09 $6.014 $0.074 $3.3647

87 $7.100 $0.087 $3.974.09 $6.014 $0.073 $3.3647

88 $7.100 $0.085 $3.964.09 $6.014 $0.071 $3.3646

89 $7.100 $0.084 $3.964.09 $6.014 $0.070 $3.3646

90 $7.203 $0.084 $4.0215 $6.208 $0.072 $3.4758

91 $7.308 $0.084 $4.0821 $6.410 $0.074 $3.5869
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-44 

Table 3-16: Present Discounted Values for Nasopharyngeal Cancer by Age at 

Exposure 

Age at Exposure 

3 Percent Discount Rate 7 Percent Discount Rate 

PV of 

Micro Risk 

Reduction 

for Fatal 

Cancer 

PV of 

Micro Risk 

Reduction 

for 

Nonfatal 

Cancer 

PV of Micro 

Risk 

Reduction 

for Cancer 

(fatal and 

nonfatal)

PV of 

Micro Risk 

Reduction 

for Fatal 

Cancer 

PV of Micro 

Risk 

Reduction for 

Nonfatal 

Cancer

PV of 

Micro Risk 

Reduction 

for Cancer 

(fatal and 

nonfatal)

92 $7.415 $0.085 $4.1427 $6.622 $0.075 $3.7081

93 $7.524 $0.085 $4.2033 $6.843 $0.077 $3.8294

94 $7.635 $0.085 $4.2640 $7.075 $0.079 $3.954.07

3854 

3855 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-45 

3856 3.5 Estimating the Value of Non-cancer Risk Reductions 

3857 

3858 This section describes the approach to estimating the benefits associated with avoiding a selected 

3859 suite of non-cancer effects as a result of the proposed TSCA Title VI Implementation Rule. This approach 

3860 is summarized from the EPA draft report titled “Approach to Assessing Non-cancer Health Effects from 

3861 Formaldehyde and Benefits from Reducing Non-cancer Health Effects as a Result of Implementing 

3862 Formaldehyde Emission Limits for Composite Wood Products” (U.S. EPA 2013November 2011).). 

3863 EPA’s non-cancer approach document (U.S. EPA ) evaluated the non-cancer health evidence used in the 

3864 derivation of candidate reference concentrations from the June 2010 draft IRIS Toxicological Review of 

3865 Formaldehyde. While the draft IRIS Toxicological Review of Formaldehyde identified seven categories 

3866 of non-cancer health effects, EPA determined there was sufficient evidence for quantitative 

3867 concentration-response modeling for only three categories of effects. The specific non-cancer endpoints 

3868 selected for the TSCA Title VI benefits assessment were: eye irritation, asthma, and reduced fertility. In 

3869 the non-cancer approach document, EPA derived concentration-response functions for these threederived 

3870 concentration-response functions for three of these endpoints and recommended accompanying unit 

3871 values for use in the benefits assessment based on a literature review of the endpoints. The National 

3872 Research Council of the National Academy of Sciences (NASNRC) peer reviewed the draft IRIS 

3873 Toxicological Review in 2011, and where possible, EPA’s non-cancer approach document followed 

3874 NASNRC recommendations, such as excluding two studies that NASNRC recommended should not be 

3875 advanced in the derivation of reference concentrations. After subsequent work, EPA determined there 

3876 was sufficient evidence for monetizing the impacts for only one effect, sensory irritation. EPA 

3877 determined that reduced fertility should not be quantified in the overall benefits analysis. And EPA 

3878 determined that respiratory related effects should not be monetized at this time, but they are qualitatively

3879 discussed below. 

3880 

3881 All of the non-market benefits are estimated to result from reduced exposure to formaldehyde 

3882 from composite wood products as a result of the proposed rule. The benefits for each avoided endpointa 

3883 non-cancer risk reduction are a function of the: (1) concentration-response function (e.g., increase in risk 

3884 of health endpoint per unit increase in formaldehyde concentration), (2) unit values of the avoided illness, 

3885 (3) impacted population, (4) background rate of the health endpoint (if applicable), and (5) estimated 

3886 change in exposure associated with the rule. All of these inputs are described briefly below, and some 

3887 (e.g., impacted population, change in exposure as a result of the rule) are described in more detail in other 

3888 sections of this document. The benefits equations for avoiding cases of eye irritation, asthma, and reduced 

3889 fertility as a result of the proposed rule are provided below. 

3890 

3891 The exposures before (“baseline”) and after the rule (“policy”) have been modeled as described in 

3892 Section 3.1. As necessary, average daily concentrations (ADC) of formaldehyde in air will be converted 

from units of mg/m3

 to ppb or vice versa using this conversion factor: 814 ppb formaldehyde = 1 mg/m3 3893 , 

3894 which corresponds to a temperature of 25°C, a pressure of 1 atm, and a molecular weight for 

3895 formaldehyde of 30.03 g/mol. 

3896 

3897 3.5.1 Eye Irritation 

3898 

3899 Information from two studies reporting sensory irritation in humans from chronic formaldehyde 

3900 inhalation exposures in a residential environment was combined to create the concentration-response 

3901 function for eye irritation. Liu et al. (1991) employed in-home measurements over a seven-day period to 

3902 calculate cumulative exposure based on time spent in the home for over 1,000 mobile home residents, 

3903 including both young children (< 4 years) and the elderly (> 65 years). Liu et al. (1991) reported that 

3904 formaldehyde exposure was a significant predictor of burning eyes in a multivariate logistic regression. 

3905 The prevalence of eye irritation increased with increasing cumulative exposure in a categorical analysis of 

3906 participants in the 20-64 age group for both summer and winter exposure estimates. While not appropriate 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-46 

3907 to derive a concentration-response function, this study provided the most specific information on the 

3908 relative timing of inhalation exposures to formaldehyde and the report of sensory irritation: exposures 

3909 were recorded in a two-week period preceding the collection of endpoint data on sensory irritation. 

3910 

3911 Hanrahan et al. (1984) assessed average exposure in the home (from 30-60 minute air samples) 

3912 and occurrence of adverse health outcomes (by questionnaires), including burning eyes, in a study of 61 

3913 teenage and adult (mean age 48) residents of mobile homes in Wisconsin. Measured formaldehyde 

3914 concentrations ranged from less than 100 ppb to 800 ppb. Hanrahan et al. (1984) provided a graphical 

3915 representation (Figure 1 in the paper) of the best-fitting logistic regression model results to the predicted 

3916 prevalence of burning eyes for formaldehyde exposures from 100 to 800 ppb. 

3917 

3918 This analysis fit a power model to the prevalence odds ratio (p/(1-p)) of burning eyes (estimated 

3919 from Figure 1 of Hanrahan et al. (1984) as a function of average formaldehyde concentration. The 

resulting functional form of the prevalence odds ratio was estimated to be p/(1-p) = Z = 7x10-7Conc2.3743 3920 . 

3921 This can be solved for prevalence (e.g., p/(1-p) = Z; p = Z/(1 + Z)) for use in the benefits equation. Since 

3922 Liu et al. (1991) produced similar results for a two-week period, the analysis adjusted the prevalence to an 

3923 annual basis consisting of 26 two-week periods (e.g., p = 26 * Z/(1 + Z)). While Hanrahan et al. (1984) 

3924 did not administer questionnaires to children explicitly, this analysis assumes that the concentration3925 response function applies to that age group as well. 

3926 

3927 There are additional sources of uncertainty associated with using this concentration-response 

3928 function. It does not account for the possibility that irritant effects may diminish with the time exposed. 

3929 Furthermore, the Hanrahan et al. (1984) data from which this concentration-response function was 

3930 derived included formaldehyde exposures only above 100 ppb. Thus, it may be problematic to apply this 

3931 concentration-response function to estimate the relationship between lower formaldehyde exposures and 

3932 burning eye prevalence. To address this potential problem this analysis includes an estimate of irritation 

3933 benefits where it is assumed that reductions below 40 ppb do not result in any additional reductions in 

3934 burning eye prevalence. 

3935 

3936 The value for willingness to pay (WTP) to avoid eye irritation is based on an estimate from 

3937 Industrial Economics (IEc) (1993). IEc (1993) estimated WTP to avoid a minor respiratory restricted 

3938 activity day using the WTP estimates from Tolley et al. (1986) and Weitzel (1990). This analysis uses the 

3939 IEc (1993) mid-range estimate for eye irritation, which is $26 in 2010$. Note that this willingness to pay 

3940 value is for the symptom of “eye irritation” while the Hanrahan et al. (1984) data used to estimate the 

3941 concentration-response function was for “burning eyes,” a type of “eye irritation.” It is also worth noting 

3942 that the willingness to pay to avoid eye irritation declines with the number of symptom days an individual 

3943 experiences. Thus, applying the WTP to avoid a single day of eye irritation as the WTP per day for 

3944 avoiding multiple days of eye irritation would tend to overstate the WTP for avoiding multiple days of 

3945 eye irritation. However, this potential problem is not a concern in the case of this analysis because the 

3946 expected annual number of eye irritation cases per individual is less than one. 

3947 

3948 By combining the concentration-response information with the unit value and other relevant 

3949 terms, the analysis calculates the higher estimate for the monetized benefits of avoided eye irritation cases 

3950 as: 

3951 

௕ܥܦܫܣ כ ܣ ቆ כ ܻܨ כ ܹܶܲ כ ܱܲܲ ൌ

஻

௕ܥܦܫܣ כ ܣ ൅ 1

௣ܥܦܫܣ כ ܣ െ஻ 

஻

௣ܥܦܫܣ כ ܣ ൅ 1

஻ቇ (27) 

3952 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-47 

3953 where: 

3954 POP is the exposed population (includes all ages and housing types); 

3955 WTP is $26 in 2010$ based on the mid-range estimate for eye irritation from IEc (1993); 

3956 FY is a factor of 26 converting two-week incidence of eye irritation, as stated in Liu et al. (1990), to 

3957 an annual basis; 

3958 AIDCb and AIDCp are the average indoor daily concentrations (AIDC) in units of ppb for the 

3959 baseline and policy scenarios, respectively. These AIDCs include exposures during time spent 

at home, school, work, and in vehicles;46 3960 and 

3961 A and B are the coefficients that define the power function that EPA fit to the prevalence odds ratio 

3962 data for burning eyes in response to average air formaldehyde concentrations in mobile homes 

from Hanrahan et al. (1984). The prevalence odds ratio, p/(1-p), is A*XB 3963 and prevalence is 

therefore (A* XB

)/(1 + A* XB), where A is 7x10-7 3964 , B is 2.3743, and X represents the 

3965 concentration (AIDCb or AIDCp). 

3966 

3967 In addition, the analysis calculates a lower estimate for the monetized benefits of avoided eye 

3968 irritation to address the potential problem of applying a concentration-response function to formaldehyde 

3969 exposure levels that are lower than observed in the study from which the concentration-response function 

3970 was derived. In this lower estimate it is assumed that reducing formaldehyde exposure levels below 40 

3971 ppb do not result in any additional reductions in burning eye prevalence cases. The lower irritation 

3972 benefit is estimated as follows: 

3973 

௕ሻሽ40 ,ሺAIDC ሼmax כ ܣ ቆ כ ܻܨ כ ܹܶܲ כ ܱܲܲ ൌ

஻

1 ൅ ܣ כ ሼmax ሺAIDC, 40ሻሽ௕

஻ െ ܣ כ ሼmax ሺAIDC, 40ሻሽ௣

஻

1 ൅ ܣ כ ሼmax ሺAIDC, 40ሻሽ௣

஻ቇ (28) 

3974 

3975 In this lower estimate, 40 is the minimum formaldehyde exposure level that the health effect 

3976 function is applied to. That is, it is assumed that reducing formaldehyde exposure below 40 ppb does not 

3977 achieve any additional reduction in eye irritation prevalence.

3978 

3979 3.5.2 Non-monetized Respiratory Related Effects

3980 

3981 Formaldehyde exposure is associated with a range of respiratory related effects. Effects from 

3982 repeated exposure in humans include irritation of the upper respiratory tract, decrements in pulmonary 

3983 function, and nasal epithelial lesions such as metaplasia and loss of cilia. Animal studies suggest that 

3984 formaldehyde may also cause airway inflammation.

3985 

 46 AIDCs are calculated from average daily concentrations. Infants (0-2), children (3-15), full time working adults, 

unemployed/retired adults, and part-time working adults are assumed to spend 11.7%, 14.3%, 4.1%, 13.8%, and 15.8% 

of their time outdoors, where background exposure levels are assumed to be .0037 mg/m3

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

May 1, 2013 3-48 

3986 3.5.2 In occupational studies of formaldehyde exposure, lung function deficits and 

3987 decreases in spirometric values (that is, the volume and speed of air that is 

3988 exhaled or inhaled) have been reported both in preshift versus postshift 

3989 measurements and as a result of long-term exposures (Alexandersson and 

3990 Hedenstierna 1989, Alexandersson, et al. 1982, Herbert, et al. 1994, Holmström 

3991 and Wilhelmsson 1988, Horvath, et al. 1988, Malaka and Kodama 1990, Neghab, et 

3992 al. 2011). Studies of long-term formaldehyde exposure also report increased 

3993 respiratory symptoms, such as cough, increased phlegm, chest tightness, and 

3994 chest colds, in exposed workers (Alexandersson and Hedenstierna 1989, 

3995 Alexandersson, et al. 1982, Herbert, et al. 1994, Holmström and Wilhelmsson 1988, 

3996 Malaka and Kodama 1990, Neghab, et al. 2011). In addition, some studies report 

3997 an association between formaldehyde exposure in residential settings and 

3998 respiratory symptoms (e.g., Garrett, et al. 1999). Furthermore, there are also 

3999 studies that report that formaldehyde exposure may increase the prevalence of 

4000 asthma – particularly in the young (e.g., Krzyzanowski, et al. 1990). Studies on 

4001 asthma, as well as mechanistic information and their analyses, were evaluated in 

4002 EPA’s recent Draft Toxicological Review of Formaldehyde – Inhalation 

4003 Assessment through the Integrated Risk Information System (IRIS) Program (U.S. 

4004 EPA 2010c). This draft IRIS assessment was released in June 2010 for public 

4005 comment and external peer review by the National Research Council of the 

4006 National Academy of Sciences (NRC). The NRC released their review report in 

4007 April 2011 (NRC 2011Asthma in Children

4008 

4009 The meta-analysis of formaldehyde-associated childhood asthma conducted by McGwin et al. () 

4010 was identified as the most relevant study to developing a concentration-response function for use in the 

4011 benefits assessment. The meta-analysis was based on seven peer-reviewed studies providing quantitative 

4012 information on the association between formaldehyde exposure and asthma in children (mean age in the 

4013 studies ranged from 2 – 14). Most of the studies were cross-sectional or case-control in design, collected 

4014 information on asthma prevalence (either self-reported or doctor diagnosed), and assigned formaldehyde 

exposures (range: 1 to > 87.5 μg/m3 4015 ) from the home or school setting. Of the seven studies included in the 

4016 meta-analysis, six reported increased risks of asthma associated with exposure to formaldehyde. The 

pooled random effects odds ratio (OR) for the seven studies was 1.17 per 10 μg/m3 4017 formaldehyde (95% 

4018 CI: 1.01-1.36). (Random effects models are preferred with heterogeneous data as they allow for different 

4019 effects or slopes in the source studies.) 

4020 

4021 McGwin et al. () noted that one of the seven studies () may have had ‘undue influence on the 

4022 study data’ and recomputed the pooled OR without that study. That study was focused on very young 

4023 children (mean age: 1.9 years; range: 6 months to 3 years), and NAS () noted that study participants of 

4024 such young ages are now thought to be more likely to have lower respiratory illnesses with wheezing of 

4025 an infectious origin rather than asthma. Therefore, this analysis uses the McGwin et al. () random effects 

4026 model excluding Rumchev et al. () as the basis of the concentration-response function for use in the 

4027 benefits assessment. Note that while the mean age for the six remaining studies ranges from 8 to 14 

4028 years old, the minimum age across the six studies was 6 and the maximum was 17 and this is the age 

4029 range for which benefits are estimated in this analysis. The pooled random effects OR reported by 

McGwin et al. () after excluding Rumchev et al. () was 1.24 per 10 μg/m3 4030 increase in formaldehyde 

4031 concentration (95% CI 1.09 – 1.42). Thus, converting to an OR based on parts per billion (assuming 

4032 conditions of 25°C and 1 atm) results in an OR of 1.027 per ppb increase in formaldehyde exposure, with 

4033 a 95% CI of 1.008-1.047 per ppb.

4034 

4035 All of the studies included in the McGwin et al. () meta-analysis measured individuals’ exposure 

4036 to formaldehyde at a single point in time; almost all of them related that single formaldehyde 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-49 

4037 measurement to asthma prevalence rather than incidence. The most reasonable interpretation of the 

4038 McGwin (2010) meta-analysis concentration-response function for use in the benefits analysis is that (1) 

4039 the formaldehyde exposure measurements reflect typical or average exposure levels of the individuals in 

the study and (2) under reasonable assumptions, prevalence can be considered cumulative incidence.47 4040 

4041 Given this, the McGwin et al. () concentration-response function is interpreted as a long-term exposure 

4042 function relating exposure to a constant level of formaldehyde over the course of childhood to a given 

4043 probability of getting asthma sometime during that childhood. The corresponding health impact function 

4044 relates changes in long-term constant or average exposure to changes in the incidence of asthma during 

4045 childhood. Because the concentration-response function from McGwin et al. (2010) is log-linear in form, 

4046 the health impact function is 

4047 

ൌ ܱܲܲܥ כ ܫ݊ܿܣ ௖כ ቀ1 െ ൫݁ሺ୪୬ሺைோሻൈሺAIDC೛ିAIDC್ሻ

൯ቁ (29) 

4048 where

4049 

4050  POPC is the exposed population of children 

4051  IncAc is the cumulative baseline incidence rate of asthma among children (for an n-year period).

4052  OR is the odds ratio derived from the McGwin et al. () meta-analysis of studies associating asthma 

with formaldehyde exposure.48 4053 EPA converted the OR for six of the seven studies from units of 

effect per 10 μg/m3 4054 to effect per ppb formaldehyde (MW = 30.03, T=25°C, P = 1 atm), and 

4055 estimated an OR of 1.027 per ppb increase in formaldehyde exposure, with a 95% CI of 1.008-1.047 

4056 per ppb.

4057  AIDCp and AIDCb are the average indoor daily concentrations (AIDC) in units of ppb for the policy 

4058 and baseline scenarios, respectively (the difference between these terms will be negative). These 

AIDCs include exposures experienced at home, school, work, and in vehicles.49 4059 

4060 

4061 However, this economic analysis considers one-year changes in formaldehyde exposure – not 

4062 changes that last over the course of childhood. Therefore, it is necessary to transform the health impact 

4063 function so that it can be applied to one-year changes in formaldehyde exposure. If exposure is constant 

4064 over an n-year period, then it is reasonable to assume that the probability of getting formaldehyde-related 

4065 asthma is uniformly distributed throughout that period – i.e., that the probability of getting asthma as a 

4066 result of exposure to formaldehyde in any one of the n years is (1/n) times the probability for the whole n4067 year period. Given this, when the economic analysis applies the health impact function to any given 

4068 annual change in exposure, the change in incidence of asthma is first calculated as if the one-year 

4069 exposure changes were occurring over the entire n-year period. This result is then divided by n so it 

4070 reflects the change in asthma incidence from a one year change in formaldehyde exposure.

4071 

4072 Estimating the baseline incidence rate of asthma is not trivial. First, estimating asthma in very 

4073 young children (under 5 years old) is problematic because doctors may rely on signs and symptoms rather 

4074 than lung function testing (spirometry) in making diagnostic decisions (U.S. HHS ). Second, while 

4075 asthma prevalence rates are widely available, asthma incidence rates are not. Estimating incidence from 

4076 prevalence is not straightforward because of the assumptions that must be made. In light of these 

 47 Prevalence can be considered cumulative incidence within a given age bracket if it is assumed that once an individual 

gets asthma the individual continues to have asthma within that given age bracket. 

48 Excluding one of the studies (Rumchev, et al. 2002; McGwin et al. (2010) reported an OR from a random effects metaanalysis model of 1.24 per 10 μg/m3

 formaldehyde (95% CI: 1.07-1.45) with a p-value of 0.0026. 49 AIDCs are calculated from average daily concentrations. Infants (0-2), children (3-15), full time working adults, 

unemployed/retired adults, and part-time working adults are assumed to spend 11.7%, 14.3%, 4.1%, 13.8%, and 15.8% 

of their time outdoors, where background exposure levels are assumed to be .0037 mg/m3

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

May 1, 2013 3-50 

4077 difficulties, the analysis estimates the incidence rates using data on asthma prevalence by age bracket. 

4078 The available data indicate that the asthma prevalence among 0-4 years olds is 7.9 percent and asthma 

4079 prevalence among 5-14 year olds is 16.2 percent (CDC ). Although this analysis accounts for the 

4080 probability that individuals with asthma become asymptomatic at some point in their lives, it assumes that 

4081 once a child gets asthma, he or she does not outgrow it before age 17. For example, for ages 0-4, the 

4082 prevalence rate is 7.9 percent. This means that 7.9 percent of individuals ages 0-4 have asthma. Since 

4083 this age range starts at birth, all of these asthma cases must have started within the age range – i.e., in this 

4084 case, prevalence equals cumulative incidence (assuming no migration in or out). For any age range that 

4085 starts at an age greater than 0, however, prevalence does not equal incidence, since some of the prevalent 

4086 cases may have started at an age less than the lower bound of the age range. For example, the 16.2 

4087 percent of individuals with asthma between the ages of 5 and 14 include those individuals whose asthma 

4088 started during ages 0-4. The incidence rate for the age range 5-14 was estimated by subtracting 7.9 

4089 percent from 16.2 percent to estimate that 8.3 percent of individuals in the age range of 5-14 are newly 

4090 diagnosed with asthma. This implies, if these new cases are uniformly distributed over the 10 ages within 

4091 that age range, the per-age (annual) incidence rate for 5 to 14-year olds would be 0.083/10 = 0.0083, or 

4092 0.83%. 

4093 

4094 This analysis calculates a lower estimate and a higher estimate. Both estimates use the same 

4095 basic method; however, the lower estimate includes benefits for ages 6 through 17, whereas the higher

4096 estimate includes benefits for ages 2 through 17. To calculate the number of avoided asthma cases (and 

4097 thus benefits) for any given age, the analysis first calculates the per capita cumulative risk reduction over 

4098 an n-year period and then divides the results by n to get the age-specific per capita risk reductions. Each 

4099 age-specific per capita risk reduction is then multiplied by the age-specific exposed population to get the 

4100 age-specific number of asthma cases avoided. 

4101 

4102 To facilitate the application of this approach to different ages, the analysis makes the simplifying 

4103 assumption that the annual incidence rate of 0.83%, calculated for children aged 5 – 14, is similarly 

applicable to all ages through age 17.50 4104 Given this assumption, the value of n doesn’t matter because n

4105 cancels out in the calculation. First, the cumulative baseline incidence rate for n-year olds is calculated 

4106 by multiplying the annual baseline incidence rate (0.83%, assumed to be the same for all ages through age 

4107 17) by n, and then the resulting cumulative risk reduction over the n-year period is divided by n to get 

4108 age-specific (annual) per capita risk reductions, for all ages in the range through age n. The calculation of 

4109 the reduction in risk for an individual at a given age (i.e., in a given year) is thus

4110 

4111 

ൌ ሺܫ݊ܿܣ ௔כ ݊ሻ ቀ1 െ ൫݁ሺ୪୬ሺைோሻൈሺAIDC೛ିAIDC್ሻ

൯ቁ

݊

(30)

4112 

4113 where is the annual baseline asthma incidence rate (0.83%). The corresponding age-specific number of 

4114 avoided asthma cases is, then,

4115 

4116 

ൌ ܱܲܲܥ כ ሺܫ݊ܿܣ ௔כ ݊ሻ ቀ1 െ ൫݁ሺ୪୬ሺைோሻൈሺAIDC೛ିAIDC್ሻ

൯ቁ

݊ (31)

4117 

 50 Given the prevalence rate of 7.9% for ages 0 – 4 from CDC (see Table 3-17 below), this may be a conservative 

assumption (i.e., an assumption that would tend to understate benefits). 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-51 

4118 where POPC is the exposed population of children of the given age. The lower estimate does this 

4119 calculation for ages 6 through 17; the higher estimate does the calculation for ages 2 through 17. In both 

4120 estimates, the resulting monetized benefit is the sum of the age-specific monetized benefits.

4121 

4122 EPA has included asthma exacerbation as a health effect in many of its economic analyses, but 

4123 not the incidence of asthma (i.e., the creation of new cases). EPA did value a decrease in asthma 

4124 incidence as a result of reduced ozone exposure in its first prospective study of the benefits and costs of 

4125 the Clean Air Act (EPA ). This analysis estimates WTP to avoid asthma by utilizing the methods that 

4126 were developed to estimate the unit value in EPA’s BenMAP (), which relies primarily on two studies 

that estimated WTP to avoid a case of adult-onset asthma.51 4127 One study, Blumenschein and Johannesson 

4128 (), estimated an annual WTP; the other study, O'Conor and Blomquist (), estimated a monthly WTP, from 

4129 which an annual estimate was derived. 

4130 

4131 The analysis first estimated the pdv of the stream of annual WTPs to avoid a case of child-onset 

4132 asthma, assuming that once a child gets asthma he has it for the rest of his life (i.e., there are no 

4133 asymptomatic asthmatics). The inputs to the analysis are:

4134 

4135  A study-specific annual WTP to avoid asthma – $189/month, or $2,268 per year (1996$) in 

4136 Blumenschein and Johannesson (1998); $1,200/year (1990$) in O'Conor and Blomquist (1997).

4137  A discount rate (the analysis used 3% and 7%).

4138  Age-specific populations for each age in the age range considered in the analysis: 6 – 17 for the 

4139 lower estimate; 2 – 17 for the higher estimate. Age group-specific population data were obtained 

from the U.S. Census Bureau,52 4140 and it was assumed that the population within an age group is 

4141 uniformly distributed among the ages in that age group.

4142  Age-specific life expectancies. The analysis obtained life expectancies for selected ages (0, 1, 5, 

10, 15, ...) from the National Vital Statistics Reports, Vol. 59, No. 4, March 16, 2011, Table 6.53 4143 

4144 The analysis linearly interpolated life expectancies for the ages that were not included among 

4145 those obtained.

4146 

4147 Using these inputs, the analysis calculated the age-specific pdv of the stream of annual WTPs, for each 

4148 age of onset in the age range (6-17 for the lower estimate; 2–17 for the higher estimate) to the age4149 specific life expectancy. If 

4150 

4151 denotes the annual WTP,

4152 denotes the age at onset of asthma (where = 6, 7, ..., or 17 for the lower estimate and = 2, 3, ..., 

4153 or 17 for the higher estimate),

4154 denotes the life expectancy for an individual age a, and

4155 dr denotes the discount rate,

4156 

4157 then the present discounted value of the stream of annual WTPs for someone who gets asthma at age a is

4158 

4159 

 51 For a description of the two studies on which the WTP to avoid adult-onset asthma is based, see the BenMAP User 

Manual, Appendix J, Section J.2.3. 

52 http://www.census.gov/compendia/statab/cats/population.html

53 http://www.cdc.gov/nchs/data/nvsr/nvsr59/nvsr59_04.pdf
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-52 



 















 

LEa

j

j

annual

a dr

WTP pdv 1

1 (1 ) (32)

4160 

4161 The analysis then calculated a weighted average pdv, using the percentages of the population in 

4162 the age categories as the weights. This assumes that any child in the age range is equally likely to have 

4163 asthma. Using the lower estimate to illustrate, if 

4164 

4165 denotes the percent of children in the age range [6-17] who are age j, j = 6, ..., 17, and

4166 denotes the expected present discounted value of annual WTPs to avoid asthma for a randomly 

4167 selected individual in the age range [6-17],

4168 

4169 Then

4170 



 

17

6

[6 17]

j

j j pdv p pdv (33)

4171 

4172 The calculation of for the higher estimate is carried out the same way, with the youngest age of 6 replaced 

4173 with a youngest age of 2. 

4174 

4175 It is worth noting that the annual (or monthly) WTP estimates from the two studies were for 

4176 adult-onset asthma. There is evidence that parents are willing to pay more to avoid adverse health effects 

4177 in their children than they are to avoid the same adverse health effects in themselves (). Using the WTP 

4178 estimates from these two studies as inputs to the calculation of a unit value for child-onset asthma could 

4179 thus tend to understate the true value.

4180 

4181 There is substantial evidence, however, that non-trivial percentages of asthmatics become 

4182 asymptomatic at some point in their lives. The Centers for Disease Control, National Health Interview 

4183 Survey (NHIS) has collected data on asthma in the U.S. for at least a decade, and data are available online 

4184 for the years 2001 through 2009. For each year, the NHIS asked several asthma-related questions. The 

4185 results are presented, separately for each year, in two sets of tables: one set of tables refers to “lifetime 

4186 asthma”; the other set refers to “current asthma.” The CDC website describes the meanings of “lifetime 

asthma” and “current asthma” as follows:54 4187 

4188 

4189 A positive response to the question: "Has a doctor or other health professional ever told 

4190 you that you had asthma?" determined lifetime asthma. To determine the prevalence of 

4191 asthma episodes or attacks, persons answering "yes" to the lifetime asthma question were 

4192 then asked, "During the past 12 months, have you had an episode of asthma or an asthma 

4193 attack?" Since 2001, current asthma status has also been collected. To determine current 

4194 asthma, persons answering "yes" to the lifetime asthma question were then asked, "Do 

4195 you still have asthma?"

4196 

4197 The 2009 population and prevalence rate results for the total U.S. population in the current 

4198 asthma and lifetime asthma tables are available online and are shown in below.

4199 

 54 See Centers for Disease Control and Prevention, National Health Interview Survey (NHIS) Data: Asthma – 

Background Information. Available online at: http://www.cdc.gov/asthma/nhis/default.htm#09. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-53 

4200 The analysis calculated the percent of individuals who said they were diagnosed with asthma and 

4201 also said they still have asthma by dividing the “current asthma population” by the “lifetime asthma 

4202 population,” separately for each age group. The analysis then calculated the percent of asthmatics who 

4203 are asymptomatic by subtracting this from 100%. For example, in the 5-14 age group, 6,534,000 

4204 individuals said they had been diagnosed with asthma; of these, 4,515,000 – or 69.1% -- said they still 

4205 have asthma. That implies that 100% - 69.1% = 30.9% of asthmatics in this age group are asymptomatic.

4206 

4207 The percentages of individuals who were diagnosed with asthma at some point in their lives but 

4208 considered themselves asymptomatic when they answered the NHIS questions were substantial, ranging 

4209 from about 20% (in the 0-4 age group) to almost 53% (in the 20-24 age group). This suggests that the 

4210 above calculation of the pdv (equation 27) may overstate the value of avoiding a case of asthma, because 

4211 it includes (discounted) annual WTPs out to the life expectancy for the age-of-onset of the asthma.

4212 

4213 Unfortunately, the NHIS asthma tables do not include the kind of longitudinal information that 

4214 are needed to properly estimate the value of avoiding child-onset asthma, taking into account that some 

4215 proportion of child asthmatics will become asymptomatic later in life. Ideally, it is necessary to know, for 

4216 each age at onset, y, in the age range [6-17], the percentage of asthmatic children who become 

4217 asymptomatic at age x, for all. This would require following a cohort of asthmatic children over time. 

4218 Instead, the NHIS data is cross-sectional – i.e., it looks at individuals of different ages at a single point in 

4219 time. Still, because the percentages of respondents in the NHIS who said they are asymptomatic are non4220 trivial, and consistent with what other sources report, it is worthwhile to attempt to take these percentages 

4221 into account in devising an estimate of the value of an avoided case of child-onset asthma.

4222 

4223 The analysis first calculated the weighted average percent asymptomatic for those age groups that 

4224 are (largely) after childhood – age groups (15-19) and older. The weight for the ith group was the 

4225 proportion of all individuals in age groups (15-19) and older who are in the ith group. The weighted 

4226 average percent asymptomatic across these age groups was 41%. The analysis assumed that an asthmatic 

4227 child who becomes asymptomatic is equally likely to do so at any age after childhood. This was 

4228 represented by a set of equally spaced ages, starting with age 17, the midpoint of the first age category 

4229 (15-19) – ages 17, 27, 37, 47, 57, and 67. Since the total proportion of child asthmatics who will become 

4230 asymptomatic at some point after childhood is assumed to be 41%, and each age is assumed to have an 

4231 equal probability of being the age at which the individual becomes asymptomatic, 41%/6 = 6.8% is the 

4232 proportion of child asthmatics who become asymptomatic at each of the 6 representative ages.

4233 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-54 Table 3-17: Results of the 2009 National Health Interview Survey Questions on Asthma and Implied Percentage of Asymptomatic Individuals 

Characteristic Total 

Population

Children 

(<18)

Adults 

(18+)

Ages 0-14 Ages 15-34

0 - 4 5 - 14 15 - 34 15 - 19 20 - 24 25 - 34 35 - 64 65+

Lifetime asthma population (in 1000s) (Table 1-1 ) 39,930 10,196 29,734 1,668 6,534 12,471 3,124 3,732 5,615 14,972 4,284Current asthma population (in 1000s) (Table 3-1 ) 24,567 7,111 17,456 1,332 4,515 6,363 1,839 1,758 2,765 9,450 2,906Percent of asthmatics who still have asthma: 61.5% 69.7% 58.7% 79.9% 69.1% 51.0% 58.9% 47.1% 49.2% 63.1% 67.8%Percent of asthmatics who are now asymptomatic: 38.5% 30.3% 41.3% 20.1% 30.9% 49.0% 41.1% 52.9% 50.8% 36.9% 32.2%Prevalence (%) Told They Had Asthma Sometime in their Lifetime (Table 2-1)

13.3 13.8 13.1 7.9 16.2 15.2 15.2 17.8 13.9 12.5 11.3

Prevalence (%) who Currently Have Asthma (Table 4-1) 8.2 9.6 7.7 6.3 11.2 7.8 9 8.4 6.8 7.9 7.7Population (in 1000s) implied by Tables 1-1 and 2-1 : 300,226 73,884 226,977 21,114 40,333 82,046 20,553 20,966 40,396 119,776 37,912Population (in 1000s) implied by Tables 3-1 and 4-1 : 299,598 74,073 226,701 21,143 40,313 81,577 20,433 20,929 40,662 119,620 37,740Average implied population: 299,912 73,978 226,839 21,128 40,323 81,811 20,493 20,947 40,529 119,698 37,826Source: Centers for Disease Control and Prevention 2009

4234 4235 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-55 

4236 For each of the representative ages (17, 27, 37, 47, 57, and 67), the analysis calculated and 

4237 given that age-when-asthma-stops, using equations ) and ) above and replacing in equation ) with the 

4238 representative age, for all values of a. It was assumed that asthma starts at the beginning of an age and 

4239 stops in the middle of an age, so that if a child gets asthma at age x and becomes asymptomatic at age y, 

4240 the number of years the child has asthma is y – x + 0.5. For example, to calculate assuming that all 

4241 asthmatic children become asymptomatic at age 27, equation ) becomes:

4242 



 



 















 

27 0.5

1

1 (1 )

a

j

j

annual

a dr

WTP pdv for each a in [6-17]. (34)

4243 

4244 The analysis then used equation ) to calculate the resulting value for. The results are shown for 

4245 the lower estimate in and , using a 3 percent and a 7 percent discount rate, respectively. Results for the 

4246 higher estimate are shown in and , using a 3 percent and a 7 percent discount rate, respectively.

4247 

Table 3-18: Calculation of Lower Estimate WTP to Avoid Child-Onset Asthma, Assuming 

Some Proportion of Asthmatics Become Asymptomatic, Using a 3 Percent Discount Rate

Age at Which Asthmatic 

Becomes Asymptomatic, 

x =**

Percent Who Become 

Asymptomatic at Age 

x

Weighted Average PDV (in 2010$), Assuming Individuals 

Become Asymptomatic at Age x, Based on:*

Blumenschein and 

Johannesson (1998)

O'Conor and Blomquist 

(1997)

17 6.8% $16,987 $10,789 

27 6.8% $40,334 $25,618 

37 6.8% $57,706 $36,653 

47 6.8% $70,633 $44,863 

57 6.8% $80,251 $50,973 

67 6.8% $87,408 $55,519 

Never becomes 

asymptomatic 59.0% $93,341 $59,287 

Overall Weighted PDV (in 2010$): $79,214 $50,314

Average of Two Study-Specific PDVs: $64,764

*Inflated to 2010$ using the CPI-U "all items".

** The analysis assumes the child gets asthma at the beginning of an age (e.g., at the beginning of age 6) 

and becomes asymptomatic in the middle of an age (e.g., halfway through age 17). Ages included for the 

lower estimate are 6 – 17.

4248 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-56 

Table 3-19: Calculation of Lower Estimate WTP to Avoid Child-Onset Asthma, Assuming 

Some Proportion of Asthmatics Become Asymptomatic, Using a 7 Percent Discount Rate

Age at Which Asthmatic 

Becomes Asymptomatic, 

x =**

Percent Who Become 

Asymptomatic at Age 

x

Weighted Average PDV (in 2010$), Assuming Individuals 

Become Asymptomatic at Age x, Based on:*

Blumenschein and 

Johannesson (1998)

O'Conor and Blomquist 

(1997)

17 6.8% $15,078 $9,577 

27 6.8% $31,353 $19,914 

37 6.8% $39,626 $25,169 

47 6.8% $43,832 $27,841 

57 6.8% $45,970 $29,199 

67 6.8% $47,057 $29,889 

Never becomes 

asymptomatic 59.0% $47,660 $30,272 

Overall Weighted PDV (in 2010$): $43,352 $27,535

Average of Two Study-Specific PDVs: $35,443

*Inflated to 2010$ using the CPI-U "all items".

** The analysis assumes the child gets asthma at the beginning of an age (e.g., at the beginning of age 6) 

and becomes asymptomatic in the middle of an age (e.g., halfway through age 17). Ages included for the 

lower estimate are 6 – 17.

4249 

4250 

4251 

Table 3-20: Calculation of Higher Estimate WTP to Avoid Child-Onset Asthma, Assuming 

Some Proportion of Asthmatics Become Asymptomatic, Using a 3 Percent Discount Rate

Age at Which Asthmatic 

Becomes Asymptomatic, 

x =**

Percent Who Become 

Asymptomatic at Age 

x

Weighted Average PDV (in 2010$), Assuming Individuals 

Become Asymptomatic at Age x, Based on:*

Blumenschein and 

Johannesson (1998)

O'Conor and Blomquist 

(1997)

17 6.8% $22,003 $13,976 

27 6.8% $44,066 $27,989

37 6.8% $60,483 $38,417

47 6.8% $72,699 $46,176

57 6.8% $81,789 $51,949

67 6.8% $88,553 $56,245

Never becomes 

asymptomatic 59.0% $94,151 $59,801

Overall Weighted PDV (in 2010$): $80,804 $51,324

Average of Two Study-Specific PDVs: $66,064

*Inflated to 2010$ using the CPI-U "all items".

** The analysis assumes the child gets asthma at the beginning of an age (e.g., at the beginning of age 6) 

and becomes asymptomatic in the middle of an age (e.g., halfway through age 17). Ages included for the 

higher estimate are 2 – 17.

4252 

4253 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-57 

4254 

4255 

Table 3-21: Calculation of Higher Estimate WTP to Avoid Child-Onset Asthma, Assuming 

Some Proportion of Asthmatics Become Asymptomatic, Using a 7 Percent Discount Rate

Age at Which Asthmatic 

Becomes Asymptomatic, 

x =**

Percent Who Become 

Asymptomatic at Age 

x

Weighted Average PDV (in 2010$), Assuming Individuals 

Become Asymptomatic at Age x, Based on:*

Blumenschein and 

Johannesson (1998)

O'Conor and Blomquist 

(1997)

17 6.8% $18,745 $11,906

27 6.8% $33,217 $21,098

37 6.8% $40,574 $25,771

47 6.8% $44,314 $28,147

57 6.8% $46,215 $29,354

67 6.8% $47,182 $29,968

Never becomes 

asymptomatic 59.0% $47,717 $30,308

Overall Weighted PDV (in 2010$): $43,886 $27,875

Average of Two Study-Specific PDVs: $35,881

*Inflated to 2010$ using the CPI-U "all items".

** The analysis assumes the child gets asthma at the beginning of an age (e.g., at the beginning of age 6) 

and becomes asymptomatic in the middle of an age (e.g., halfway through age 17). Ages included for the 

higher estimate are 2 – 17.

4256 

4257 The actual distribution of ages at which asthmatic children become asymptomatic is not known, 

4258 and the resulting pdv depends on this distribution. In the absence of any further information, the analysis 

4259 assumed this distribution is uniform – i.e., an asthmatic is equally likely to become asymptomatic at any 

4260 age. Selecting evenly spaced ages starting at age 17 was just a convenient way to model this.

4261 

4262 Combining the WTP to avoid a case with the estimate of the number of avoided cases, the 

4263 analysis estimates the monetized benefits of avoiding the development of asthma for 6-17 year olds, for 

4264 the lower estimate, as: 

4265 

4266 

כ ܹܶܲ ൌ

ܱܲܲܥ כ ܫ݊ܿܣܽ כ ݊ ቀ1 െ ൫݁ሺ୪୬ሺைோሻൈሺAIDC೛ିAIDC್ሻ൯ቁ

݊

(35)

4267 

4268 where WTP is $64,764 (if a 3 percent discount rate is used) or $35,443 (if a 7 percent discount 

4269 rate is used) and now POPC is the population of exposed children ages 6 – 17. An analogous calculation 

4270 is done for the higher estimate, where WTP is $66,064 (if a 3 percent discount rate is used) or $35,881 (if 

4271 a 7 percent discount rate is used) and POPC is now specific to the age range [2, 17].

4272 ). The NRC suggested EPA should examine studies relating formaldehyde exposures to asthma, 

4273 pulmonary function and changes in pulmonary pathology. EPA is currently revising the draft assessment 

4274 in response to the NRC review. 

4275 

4276 EPA is committed to evaluating alternative approaches to quantifying the benefits associated with 

4277 reduced respiratory symptoms such as exacerbation of symptoms among those who have chronic
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-58 

4278 respiratory diseases, e.g., bronchitis and asthma. For instance, the agency will explore the extent to which 

4279 approaches used to quantify respiratory symptoms in air quality rules might be applied to residential 

4280 exposure to formaldehyde. If a scientifically defensible approach is available by the time the final rule is 

4281 promulgated, EPA will include such quantification as part of the benefits analysis. 

4282 

4283 Although uncertainty remains regarding how best to quantify the formaldehyde exposure’s effect 

4284 on respiratory outcomes, EPA considers these effects to be important non-monetized impacts that 

4285 contribute to the overall benefits of this rule, as indicated by the “+B” in the various tables summarizing 

4286 benefits.

4287 

4288 3.5.3 Female Fertility 

4289 

4290 At this time, EPA does not feel that it has sufficient information on the relationship between 

4291 formaldehye exposure and reduced fertility to include a valuation estimate in the overall benefits analysis. 

4292 Based on a review of the developmental and reproductive toxicity studies in humans and animals in the 

4293 draft IRIS assessment (U.S. EPA 2010c), the Taskinen et al. (1999) retrospective cohort study appears to 

4294 have the best available evidence of female reproductive toxicity for the purpose of deriving a 

4295 concentration-response relationship for use in the benefits assessment. In Taskinen et al. (1999) subjects 

4296 recruited subjects from a woodworkers’ union and other businesses involving wood processing in 

4297 Finland, and were linked to a national register of births. Women were included if they were born between 

4298 1946 and 1975, had a live birth at age 20−40 years during 1985−1995, had worked in the wood 

4299 processing industry for at least 1 month, and had first employment in the wood processing industry 

4300 beginning at least 6 months before the index pregnancy (the first pregnancy that fulfilled the above 

4301 criteria). While 1,094 women met these criteria, the final sample included 602 women due to the response 

4302 rate from mailed questionnaires (64%) and exclusions due primarily to infertility history, unknown time 

4303 to pregnancy, and contraceptive failure. 

4304 

4305 Estimates of mean daily exposure to formaldehyde were based on measurements taken at the 

4306 women’s factories of employment during the early 1990s., and were categorized as low, medium and 

4307 high. Where measurements were unavailable, measurements from equivalent industries were used. An 

4308 exposure index representing a time-weighted average exposure (TWA) was established for every person 

4309 in the study based on the concentration of their workplace formaldehyde multiplied by the proportion of 

4310 the workday exposed to formaldehyde. The investigators categorized time-weighted average 

4311 formaldehyde exposure into categories of low (mean of 18 ppb), medium (mean of 76 ppb), and high 

4312 (mean of 219 ppb) exposure. Time-to-pregnancy data were analyzed by a discrete proportional hazards 

4313 regression procedure with a fecundability density ratio (FDR) as the outcome. This ratio compared the 

4314 average incidence densities of pregnancies for exposed women with that of the employed, unexposed 

4315 women. As explained by Taskinen et al. (1999), an FDR significantly below unity suggests that 

4316 conception was delayed. The age-, employment-, smoking-, alcohol consumption-, parity-, and menstrual 

4317 irregularity-adjusted FDR was 0.64 (95% CI: 0.43−0.92) for women exposed to high formaldehyde levels 

4318 compared with the unexposed controls, indicating that there was a substantial, and statistically significant,

4319 delay in time to conception in this group of women. 

4320 

4321 This analysis relied on Table 5 of Taskinen et al. (1999) to derive its concentration-response 

4322 relationship. That table providedprovides information on time-to-pregnancy (in menstrual cycles) for 

4323 women in low, medium, and high levels of formaldehyde exposure, as well as non-exposed to 

4324 formaldehyde. The fraction of women who took longer than 13 menstrual cycles to conceive was 9.1% 

4325 for non-exposed, 10.1% for low, 11.7% for medium, and 20.5% for high levels of formaldehyde 

4326 exposure. In most women, 13 menstrual cycles would correspond to approximately 12 months, and 

4327 infertility is often defined as the inability to conceive within 12 months. Thus, these data were used to 

4328 generate a concentration-response function for formaldehyde exposure and infertility in women. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-59 

4329 

4330 First, the average formaldehyde exposure concentrations were adjusted for background exposures 

4331 to formaldehyde estimated from a personal exposure study. Jurvelin et al. () estimated personal 48-hour 

4332 exposures to formaldehyde in the summer/fall of 1997 for 15 persons in Helsinki, Finland. Personal 

4333 exposure levels were significantly correlated with indoor residential concentrations. The mean personal 

4334 exposure level was 21.4 ppb. According to EPA’s non-cancer approach document (U.S. EPA ), the 24-hr 

4335 time-weighted average exposure levels were determined to be 21 ppb for “non-exposed”, 26 ppb for low, 

4336 43 ppb for medium, and 89 ppb for high levels of formaldehyde exposure. 

4337 

4338 This analysis uses the concentration-response function estimated in EPA’s non-cancer approach 

4339 document (U.S. EPA ). This concentration-response function was estimated by fitting a linear regression 

4340 to these formaldehyde concentrations and the corresponding fraction of women who took longer than 12 

4341 months to conceive, where Risk = alpha + beta*Concentration. Thus, the estimated regression equation 

4342 did not include any confounder variables. Alpha was estimated to be 0.056 (5.6%) and beta was 

4343 estimated to be 0.0016 per ppb. 

4344 

4345 The number of women in the U.S. wishing to become pregnant can be estimated from CDC 

4346 information on pregnancy and contraception use (CDC 2010). In particular, the percentage of women 

4347 seeking pregnancy over the course of a year can be estimated as the sum of the percentage who reported 

4348 not using contraception because they were seeking pregnancy and the percentage who are intentionally 

4349 pregnant or postpartum after an intentional pregnancy. The percentages of women who reported not 

4350 using contraception because they were seeking pregnancy were 4.3%, 6.3%, 5.9%, and 5.1% for age 

4351 ranges 20-24, 25-29, 30-34, and 35-39, respectively. The percentages of women who were pregnant or 

4352 postpartum were 10.0%, 7.7%, 8.1%, and 1.9% for age ranges 20-24, 25-29, 30-34, and 35-39, 

4353 respectively. Since half of pregnancies are intended, according to CDC (2010), the percentage of women 

4354 seeking pregnancy over the course of a year was estimated as the percentage of those currently seeking 

4355 pregnancy plus half the percentage who are pregnant or postpartum. These estimates are 9.3%, 10.2%, 

4356 10.0%, and 6.1% for age ranges 20-24, 25-29, 30-34, and 35-39, respectively. 

4357 

4358 Fertility problems are not uncommon during a woman’s reproductive cycle. Garceau et al. () 

4359 claims that one in six couples experience fertility difficulty at some point in time in their reproductive 

4360 lives. The CDC () reports that nearly 12% of women of childbearing age in the United States have sought 

4361 some type of cycle-based fertility service at some point in their reproductive cycles. While obtaining 

4362 some fertility service is common, only 3.8% obtain ovulation drugs, 1.1% undergo artificial insemination 

4363 and 0.3% engage in assisted reproductive technology, primarily in-vitro fertilization (IVF). The remainder 

4364 seek advice, undergo tests, or obtain medical help to prevent miscarriages or surgery for blocked tubes. 

4365 These rates vary by age group as shown in the table from CDC () below.

4366 

4367 presents the probabilities of seeking pregnancy and of obtaining cycle-based treatment that are 

4368 used in the analysis. Note that the last three columns, which present the percentages of women using a 

4369 particular fertility treatment given that they have sought some fertility treatment, do not sum to one 

4370 hundred percent. This is because the costs associated with fertility treatments other than the three 

4371 presented in the table were not estimated. Thus, these costs are implicitly assumed to be zero for the 

4372 purpose of this analysis.

4373 

4374 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-60 

Table 3-22: Probability of Seeking Pregnancy and of Obtaining Cycle-Based Fertility Treatment 

in U.S. Women 

Percent Obtaining Treatment

Percent Obtaining Treatment 

Conditional on Some Fertility 

Treatment Being Sought

Age 

Group

Percent 

Seeking 

Pregnancy

Any 

Fertility 

Service

Ovulation 

drugs IUI IVF Ovulation drugs

IUI IVF

20-24 9.3% 4.9% 1.0% 0.2% 0.0% 20.41% 4.08% 0.00% 25-29 10.2%

30-34 10.0% 17.7% 5.3% 1.8% 0.4% 29.94% 10.17% 2.26%

35-39 6.1% 17.3% 4.6% 1.4% 0.3% 23.96% 7.29% 3.65%

Source: Percent seeking pregnancy is from CDC 2010b and percent obtaining treatment is from CDC 2005

4375 

4376 Infertility is generally defined as the inability to become pregnant after trying to become pregnant 

4377 for a year (CDC ). Thus, delayed fertility, the health outcome to which this economic analysis relates 

4378 formaldehyde exposure, is effectively the same as infertility given this definition. That said, it is 

4379 important to use WTP values that are appropriate for the specific type of infertility being evaluating –

4380 infertility cases where a successful pregnancy can be achieved. This economic analysis estimates the 

4381 willingness to pay to avoid delayed fertility using a cost of illness approach, where the cost of illness is 

4382 estimated as the cost of fertility treatments for those patients who ultimately become pregnant. 

4383 

4384 Katz () reports estimates of the median fertility treatment costs for women who successfully 

4385 became pregnant, which are likely to closely reflect the actual treatment costs for women with delayed 

4386 fertility who seek treatment for their condition. 

4387 

4388 One fertility treatment option is to take medication to stimulate ovulation in order to improve the 

4389 chances of conceiving. Another option is intrauterine insemination, a process in which the sperm is placed 

4390 in the uterus (intrauterine insemination, or IUI) by artificial means. In vitro fertilization (IVF) is yet 

4391 another option in which human egg cells are fertilized by sperm outside the body and then transferred 

4392 back to the patient's uterus. Katz () estimates the median treatment costs for women who had successful 

outcomes as $925 for medication; $4,124-$8,542 for IUI;55 and $24,010-$38,545 for IVF.56 4393 This analysis 

4394 converts the estimates from Katz (2011) to 2010$ and uses the midpoints of the ranges estimated by Katz 

4395 (). The resulting estimates are $1,001, $6,848, and $33,831 for medication, IUI, and IVF, respectively. 

4396 

4397 There are two sources of potential bias associated with using this cost of illness approach. First, 

4398 since most fertility treatments are paid for out-of-pocket rather than through insurance, patients’ 

4399 willingness to pay for these treatments will be at least as high as the cost of the treatments, for those 

4400 patients that seek the treatments – that is, these patients are willing to pay the going rate for the treatment 

4401 and may be willing to pay more than the going rate. To the extent that they would be willing to pay more 

4402 than the going rate, the cost-of-illness estimates understate their true willingness to pay. On the other 

4403 hand, since some women with fertility problems may not seek treatment, this implies that their 

4404 willingness-to-pay to avoid infertility is lower than the cost of treatment. Thus the cost-of-illness 

4405 estimates will overstate the willingness to pay for these women. Since these two biases go in opposite 

4406 directions, it is not clear whether the end result will be an upward or a downward bias.

4407 

4408 Combining the concentration-response information with the population estimates, unit value, 

4409 probability of seeking pregnancy, and probability of using a particular cycle-based treatment given that 

4410 one is seeking a fertility service, and assuming that all women seeking pregnancy but having difficulty 

 55 $4,124 was the median for IUI with clomiphene citrate and $8,524 was the median for IUI with gonadotropins. 56 $24,010 was the median for IVF without a donor egg and $33,831 was the median with a donor egg. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-61 

4411 getting pregnant opt for some kind of fertility service, the analysis estimates the monetized benefits of 

4412 increased fecundity in women of childbearing age as:

4413 

௔ܫܷܫݎܲ ൅ ݐݏ݋ܥݏ݁݀ܯ ൈ௔ ݏ݁݀ܯݎܲሺ ൈ௔ ܵܲݎܲ ൈ ൯௣ܥܦܫܣ െ௕ ܥܦܫܣ൫ ൈ ܣܶܧܤ ൈ௔ ܹܣܤܥܱܲܲ෍ ൌ

௔

ሻݐݏ݋ܥܨܸܫ ൈ௔ ܨܸܫݎܲ ൅ ݐݏ݋ܥܫܷܫ ൈ

(36)

4414 

4415 

4416 Where:

4417  POPCBAWa is the exposed population of childbearing-aged women

4418  Subscript a denotes an age group (20-24, 25-29, 30-34, or 30-39)

4419  BETA is the slope derived by EPA by fitting a linear regression to the data in Taskinen et al. () 

4420 relating the risk of not conceiving in a year to average formaldehyde occupational exposures 

4421 (EPA also adjusted these time-weighted concentrations for background exposures of 

4422 formaldehyde). The slope was determined to be 0.0016 increase in risk of not conceiving in one 

4423 year per unit increase in ppb formaldehyde concentration

4424  AIDCp and AIDCb are the average indoor daily concentrations (AIDC) in units of ppb for the 

4425 policy and baseline scenarios, respectively (the difference between these terms will be negative). 

These AIDCs include exposures experienced at home, school, work, and in vehicles.57 4426 

4427  PrSPa is the probability a woman in age group a is seeking to become pregnant, estimated as the 

4428 percentage of women in age group a who are not using contraception because they want to 

4429 become pregnant plus half the women in age group a who are pregnant or are postpartum from 

4430 Table 5 CDC (). Note that only half of the pregnant or postpartum women are included because 

4431 half of pregnancies are unintended according to CDC (). The estimated percentages are 9.3%, 

4432 10.2%, 10.0%, and 6.1% for age ranges 20-24, 25-29, 30-34, and 35-39, respectively.

4433  PrMedsa is the probability of using fertility drugs (ovulation medication) among women in age 

4434 group a given that they have sought some fertility service, from CDC (). It is 20.41%, 29.94%, 

4435 and 23.96% for women aged 20-29, 30-34, and 35-39, respectively. 

4436  PrIUIa is the probability of using artificial intrauterine insemination (IUI) among women in age 

4437 group a given that they have sought some fertility service from CDC (). It is 4.08%, 10.17%, and 

4438 7.29% for women aged 20-29, 30-34, and 35-39, respectively.

4439  PrIVFa is the probability of using in vitro fertilization (IVF) assisted reproductive technology 

4440 among women in age group a given that they have sought some fertility service from CDC (). It 

4441 is 0.00%, 2.26%, and 3.65% for women aged 20-29, 30-34, 35-39, respectively

4442  MedsCost is $1,001in 2010$, the average treatment cost for women with successful outcomes 

4443 after using ovulation drugs reported by Katz ()

4444  IUICost is $6,848 in 2010$, the midpoint of the average IUI treatment cost for women with 

4445 successful outcomes reported by Katz ()

4446  IVFCost is $33,831 in 2010$, the midpoint of the average IVF treatment cost for women with 

4447 successful outcomes reported by Katz ()

4448 

 57 AIDCs are calculated from average daily concentrations. Infants (0-2), children (3-15), full time working adults, 

unemployed/retired adults, and part-time working adults are assumed to spend 11.7%, 14.3%, 4.1%, 13.8%, and 15.8% 

of their time outdoors, where background exposure levels are assumed to be .0037 mg/m3

. 
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May 1, 2013 3-62 

4449 At this time, EPA does not feel that it has sufficient information on the relationship between 

4450 formaldehye exposure and reduced fertility to include a quantification or valuation estimate in the overall 

4451 benefits analysis. EPA does feel that this effect is an important non-monetized impact which should be 

4452 recognized as a contribution to the overall benefits of this rule, as indicated by the “+B” in the various 

4453 tables summarizing benefits. 
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May 1, 2013 3-63 

4454 3.6 Estimated Numbers of Affected Individuals 

4455 

4456 The number of individuals benefitting from the reduction of formaldehyde emissions from 

4457 composite wood products potentially includes anyone who resides, works, or otherwise spends a 

4458 substantial amount of time where new composite wood products are introduced to an indoor space. This 

4459 benefits analysis includes monetized benefits for only two broad categories where a substantial amount of 

4460 new composite wood products might be introduced to residences: (1) new home construction and (2) 

4461 major renovations that include kitchen remodeling. As described in section 3.1, exposures were estimated 

4462 separately for the various categories listed in Table 3-17. Table 3-17 also includes a brief description of 

4463 the data sources and methods that were used to estimate these populations. Additional description of how 

4464 the populations were estimated for renovated housing is provided in section 3.6.1. A summary of the 

4465 estimated number of affected individuals is presented in section 3.6.2. 

4466 
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May 1, 2013 3-64 

Table 3-17: Exposure Factor Categories Used to Define Population Groups

Exposure 

Factor 

Exposure Factor Categories Description 

Composite wood 

product source 

and age 

1. New housing construction for 

11 ages of the housing 

2. Renovated housing for 11 ages 

of the installed composite 

wood products 

The American Community Survey (ACS) reports house age in 

segments, the most recent being 2005 to 2009. One fifth of 

population living in homes constructed between 2005 and 2009 was 

used to estimate the number of people inhabiting new construction 

on an annual basis. The 2009 American Housing Survey (AHS) 

asked respondents about renovation activities in a two year period. 

Half of the kitchen renovation rate in owner-occupied housing, 

stratified by housing type and home vintage, was applied to ACS 

populations to estimate people exposed due to renovation activities in 

owner and renter occupied homes annually. 

Structure type 1. Single family attached 

2. Single family detached 

3. Apartment 

4. Manufactured Housing 

5. Recreational Vehicles and 

Camper/Trailers 

The 2007-2009 ACS reports housing type in a variable that takes the 

following values: Mobile home or trailer; One-family house 

detached; One-family house attached; 2 Apartments; 3-4 Apartments; 

5-9 Apartments; 10-19 Apartments; 20-49 Apartments; 50 or more 

apartments; Boat, RV, van, etc. This variable was recoded to provide 

the five categories in the benefits analysis. 

Climate zone 1. Zone 1: <2,000 cooling degree 

days (CDD) and more than 

7,000 heating degree days 

(HDD) 

2. Zone 2: <2,000 CDD and 

5,500 to 7,000 HDD 

3. Zone 3: <2,000 CDD and 

4,000 to 5,499 HDD 

4. Zone 4: <2,000 CDD and 

<4,000 HDD. 

5. Zone 5: >2,000 CDD and 

<4,000 HDD 

Note: Number of degree days is 

over a 30-year period. 

Each public use micro area (PUMA) in the ACS was assigned a 

climate rating by mapping from NOAA division data to PUMAs 

using NOAA data matching climate divisions to counties. The 

NOAA data used to develop the climate ratings is from NOAA’s 

publication “Climatography Of The United States No. 85: Divisional 

Normals of Temperature, Precipitation, and Heating and Cooling 

Degree Days”. The data is available for between one and ten 

divisions in each state. A climate division is a region within a state 

that is as climatically homogeneous as possible. 

Not all counties were available in the NOAA dataset. Hawaii and 

Alaska were not included, though as Alaska has the same climate 

rating for the entire state, this was not a problem. Hawaii’s counties 

are individual islands, as are the climate regions, which made 

creating that mapping straightforward. Other missing cases include 

independent cities, the District of Columbia, and a few counties in 

New Mexico and Arizona. In these cases, each missing area was 

assigned the same region as adjacent counties in the database. 

For the PUMAs with multiple county matches that had different 

climates, a population-weighted average climate rating was assigned 

. 

Age and 

employment 

status 

1 Infants: less than age 2 

2 Children: aged 2 through 15 

3 Ages 16+; work full-time 

outside the composite wood 

products industry 

4 Ages 16+; work in composite 

wood products fabrication 

5 Ages 16+; work part-time 

outside the composite wood 

products industry 

6 Ages 16+; unemployed or not 

in the labor force 

An individual observation’s age is available in the ACS from ages 0 

to 95, with ages above 95 being counted as 95. For the exposure 

categories 1 and 2, infants and children were defined as ages 0-1 and 

2-15, respectively. Individuals aged 16-95 working 20+ hrs, not at 

home, in any industry categories other than those listed below were 

included in category 3. Individuals that reported employment in the 

industries that manufacture furniture and related products or that 

manufacture prefabricated wood buildings and mobile homes were 

defined as working in composite wood product fabrication (category 

4). Individuals aged 16-95 working 0-20 hrs, not at home, in any 

other industry categories were included in category 5. Individuals 

aged 16-95 who were not working, retired, or not in the labor force 

were counted in category 6. Also counted in category 6 were 

individuals who work from home. 

4467 

4468 
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May 1, 2013 3-65 

4469 

4470 3.6.1 Composite Wood Products Installed During Renovation 

4471 

4472 The ACS does not provide any information with respect to renovation for home-owners or 

4473 renters. Thus, it was necessary to use another data source to estimate renovation rates among the 

4474 population, and apply those rates to the ACS population estimates. 

4475 

4476 The National 2009 American Housing Survey (AHS) Dataset was used to determine the average 

4477 frequency of kitchen renovation among homeowners. Kitchen renovation was determined to be the most 

4478 likely source of new composite wood products being introduced in a home. In order to obtain a mean 

4479 value that would be consistent with the ACS data, the variable in the AHS indicating the year the home 

4480 was built was recoded into nine categories so that there were no overlaps between the AHS and ACS 

4481 categories. 

4482 

4483 As noted in a recent Joint Center for Housing Studies’ report (Will 2010), data specific to the 

4484 frequency or expenditures of remodeling and renovation in rental housing are not available. However, 

4485 home renovation data were available for owner-occupied housing in the following categories: single4486 family detached homes, single-family attached homes, manufactured housing, and apartments. Because 

4487 renovation frequency data for renter-occupied housing were not available, the renovation frequency for 

4488 owner-occupied housing was used for both owner- and renter-occupied housing. 

4489 

4490 Table 3-18 presents the average renovation frequency by housing type and year of construction. 

4491 The overall average is 2.7 percent. Homes built in recent years renovate less, on average, than homes 

4492 from previous decades. Since homes built in the last 11 years are accounted for in the new home exposure 

4493 category in this analysis, these homes were assumed not to conduct a renovation. Note that a non-trivial 

4494 percentage of homeowners renovate kitchens in even the newest homes (i.e., homes built in 2009 also 

4495 surveyed in 2009). However, to simplify the analysis separate exposure scenarios were not estimated for 

4496 housing that is both new and recently renovated. Instead, these scenarios were simply treated as new 

4497 homes. This simplifying assumption may result in an underestimate for the formaldehyde exposures 

4498 experienced by individuals living in newer homes that were recently renovated. 

4499 

4500 

Table 3-18: Frequency of Kitchen Renovation by Housing Type and 

Year Built, 2009 AHS 

Year Built 

Single-Family 

Detached 

Homes 

Single-Family 

Attached 

Homes 

Apartments Manufactured 

Housing 

2005 or later - - - - 

2000 to 2004 - - - - 

1990 to 1999 2.8% 2.7% 1.4% 1.1% 

1980 to 1989 3.4% 2.1% 4.0% 2.1% 

1970 to 1979 2.9% 2.6% 3.2% 2.4% 

1960 to 1969 2.3% 2.2% 0.8% 

2.2% 

1950 to 1959 2.8% 3.8% 2.1% 

1940 to 1949 3.0% 2.1% 2.3% 

1939 or earlier 2.8% 3.0% 2.7% 

4501 

4502 

4503 There were two year built categories of manufactured housing where no kitchen renovations were 

4504 reported. Each of these cells has fewer than 20 observations associated with it. Since there was not a 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-66 

4505 statistically significant difference between manufactured housing renovation in 1960-1969 and 1940-

4506 1949, the analysis used the same mean renovation rate for all manufactured housing built prior to 1969. 

4507 The renovation frequencies presented in Table 3-18 were applied to all homes by housing age and 

4508 structure type. Applying the renovation percentages presented in Table 3-18 to the 2007-2009 ACS 

4509 National Dataset results in the population totals and household counts presented in Table 3-19. It should 

4510 be noted that the renovation percentage was applied to the aggregated totals by housing age and structure 

4511 type. 

4512 

Table 3-19: Total Population in Renovated Houses 

Housing Type Population in 

Renovated Homes 

Percent of Total 

Population 

Renovated 

Households 

Percent of Total 

Households 

Single-Family Detached 4,922,274 2.8% 1,768,967 2.8% 

Single-Family Attached 367,710 2.6% 142,962 2.6% 

Apartment 1,344,143 2.5% 634,781 2.5% 

Manufactured Housing 268,559 1.8% 109,549 1.8% 

Total 6,902,686 2.7% 2,656,259 2.7% 

4513 

4514 

4515 3.6.2 Summary of Population Estimates 

4516 

4517 The analysis estimates that there will be about 10 million individuals living in housing units 

4518 where composite wood products have been installed within the past year (i.e., individuals who have 

4519 moved into new home or live in a home where there was a renovation). Since these individuals are 

estimated to be affected by the emissions from these products over a period of 11 years, by the 11th 4520 year it 

4521 is estimated that about 106 million individuals live in housing units where composite wood products have 

4522 been installed within the past 11 years. Table 3-20 and Table 3-21 present a summary of the population 

4523 estimates by the categories that are used to define the different exposure groups. See Table 3-17 and 

4524 section 3.6.1 for a description of how these populations were estimated. The reductions in micro risks of 

4525 adverse health outcomes (see sections 3.3 and 3.5) are applied to these population estimates and 

4526 combined with the values of reducing micro risks for the various adverse health outcomes (see sections 

4527 3.4 and 3.5) to estimate the total value of the reduced risks of adverse health outcomes. 

4528 

4529 
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May 1, 2013 3-67 

Table 3-20: Population Estimates by Age of New Construction, Years since Renovation 

and Structure Type 

Age of new construction in 

Years 

Years since renovation Structure Type 

Category Population Category Population Category Population 

0-1 2,738,898 0-1 6,902,685 New Apt 4,755,876 

1-2 2,738,898 1-2 6,902,685 New Man 1,405,598 

2-3 2,738,898 2-3 6,902,685 New RV 52,063 

3-4 2,738,898 3-4 6,902,685 New SF Att 2,235,686 

4-5 2,738,898 4-5 6,902,685 New SF Det 21,678,650 

5-6 2,738,898 5-6 6,902,685 Total New 30,127,874

6-7 2,738,898 6-7 6,902,685 Ren Apt 14,785,584 

7-8 2,738,898 7-8 6,902,685 Ren Man 2,954,145 

8-9 2,738,898 8-9 6,902,685 Ren SF Att 4,044,810 

9-10 2,738,898 9-10 6,902,685 Ren SF Det 54,144,991 

10-11 2,738,898 10-11 6,902,685 Total Renovated 75,929,530

Total New 30,127,874 Total Renovated 75,929,530 All Structures 106,057,404 

Source: U.S. Census Bureau 2009c, d 

Note: See Table 3-17 and section 3.6.1 for a description of how these populations were estimated. Age of new 

construction and years since renovation indicates the number of years since composite wood products were 

introduced to the house. For example, “0-1” for years since renovation indicates that the structure was renovated 

within the past year. Totals may not add due to rounding. 

Abbreviations: 

“New SF Att” is new construction of single-family attached housing (up to 11 years old) 

“New SF Det” is new construction of single-family detached housing (up to 11 years old). 

“New SF Apt” is new construction of multi-family housing (up to 11 years old). 

 “New SF Man” is new construction of manufactured housing (up to 11 years old). 

“New SF CT” is new campers and trailers (up to 11 years old). 

“New SF Att” is renovated single-family attached housing (up to 11 years old) 

“New SF Det” is renovated single-family detached housing (up to 11 years old). 

“New SF Apt” is renovated multi-family housing (up to 11 years old). 

 “New SF Man” is renovated manufactured housing (up to 11 years old). 

Note: Campers and Trailers are assumed to never be renovated. 

4530 

Table 3-21: Population Estimates by Climate Zone, Age of Individual, and 

Occupation 

Climate Zone Occupation of Individual

Category Population Category Population 

Zone 1 13,177,114 Infants 0-1 3,309,269 

Zone 2 23,906,632 Children 2-15 21,312,289 

Zone 3 20,637,107 Not CWP Industry 55,523,507 

Zone 4 21,214,309 Fabrication 238,487 

Zone 5 27,122,241 Unemployed 19,508,314 

- Part Time 6,165,538 

Total 106,057,404 Total 106,057,404 

Source: U.S. Census Bureau 2009c, d 

Note: See Table 3-17 and section 3.6.1 for a description of how these populations were estimated. Totals 

may not add due to rounding. 

Abbreviations: 

Zone 1: Fewer than 2,000 cooling degree days and more than 7,000 heating degree days over 30 years. 

Zone 2: Fewer than 2,000 cooling degree days and 5,500 to 7,000 heating degree days over 30 years. 

Zone 3: Fewer than 2,000 cooling degree days and 4,000 to 5,499 heating degree days over 30 years. 

Zone 4: Fewer than 2,000 cooling degree days and fewer than 4,000 heating degree days over 30 years. 

Zone 5: 2,000 or more cooling degree days and fewer than 4,000 heating degree days over 30 years. 

4531 

4532 
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May 1, 2013 3-68 

4533 3.7 Results of Benefits Assessment 

4534 

4535 This section presents the results of the benefits assessment. Detailed results are presented for the 

4536 analytical options with emissions standards that are consistent with the TSCA Title VI statute. Summary 

4537 results are presented for the additional options that consider alternative formaldehyde emissions 

4538 standards. Section 3.7.1 presents the total benefits attributable to reductions in cancer risk by combining 

4539 the changes in cancer risk (see section 3.3), the value of the reductions in risk (see section 3.4) and the 

4540 number of individuals experiencing reductions in risk (see section 3.6). Section 3.7.2 presents the total 

4541 benefits attributable to reductions in non-cancer adverse health risks by combining the changes in non4542 cancer adverse health risks (see section 3.5), the value of the reductions in risk (see section 3.5) and the 

4543 number of individuals experiencing reductions in risk (see section 3.6). 

4544 

4545 As described in section 3.2, this analysis assumes that after eleven years any continuing (and 

4546 declining) emissions from a given composite wood product would contribute negligibly to that product's 

4547 effect on formaldehyde exposure. Thus, composite wood products are assumed to contribute to 

formaldehyde exposure for 11 years.58 4548 Specifically: 

4549 

4550  in the first year only new composite wood products are affected by the policy; 

4551  in the second year new and one-year-old composite wood products are affected by the 

4552 policy; 

4553  in the third year new, one- and two-year-old composite wood products are affected by the 

4554 policy; 

4555  in general, in the nth year, new, one-, two-, three-,..., and (n-1)-year-old composite wood 

4556 products are affected by the policy, for n = 1, 2, ..., 10; and 

4557  in the eleventh and all subsequent years new, one-, two-, three-, four-, five-, six-, seven-, 

4558 eight-, nine-, and ten-year-old composite wood products are affected by the policy. 

4559 

4560 Since the exposure scenarios are defined in part according to the 11 different ages for composite 

wood products, it is not until the 11th 4561 year after the implementation of the rule that benefits are realized 

under every exposure scenario. That is, it is not until the 11th 4562 year after rule implementation that ten-year 

4563 old composite wood products would have been required to be produced in compliance with the emissions 

4564 standards. Thus, the benefits are phased in over a period of eleven years. 

4565 

4566 Similarly, the benefits from a given year of composite wood production will phase-out over time. 

4567 Since the analysis considers the benefits and costs from 30 years of composite wood production, the 

estimated exposures have the following time profile after the 30th 4568 and last year of composite wood 

4569 production considered in the analysis: 

4570 

 in the 31st 4571 year, only one-, two-, three-, four-, five-, six-, seven-, eight-, nine-, and tenyear-old composite wood products are produced before the 31st 4572 year (benefits from new 

4573 composite wood products are produced after year 30 and therefore are not considered in 

4574 the analysis); 

 in the 32nd 4575 year, only two-, three-, four-, five-, six-, seven-, eight-, nine-, and ten-year-old 

composite wood products are produced before the 31st 4576 year (benefits from new and one4577 year old composite wood products are produced after year 30 and therefore are not 

4578 considered in the analysis); 

 58 EPA calculated exposures using a 1.5 year emissions half life of formaldehyde from composite wood products With. 

this half life, the emission rate 10 years after new construction would be about 1 % of the initial value, and after 11 

years the emissions would be near zero. 
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May 1, 2013 3-69 

4579  in general, in the nth year after year 30, only n year-old and older composite wood 

4580 products are produced before year 31, for n = 1, 2, ..., 10; and 

 in the 41st 4581 and all subsequent years, all 11 ages of composite wood products that 

potentially contribute to formaldehyde exposure are produced after the 30th 4582 year and 

4583 therefore are not considered in the analysis. 

4584 

4585 Given this phase-in and phase-out, a time period of thirty years of composite wood production 

4586 was selected so that the first ten years of the policy (when the benefits of the policy are being phased in) 

4587 and the ten years after the 30 years of composite wood production that is analyzed (when the benefits of 

4588 the policy are being phased out) do not obscure the steady state benefits that would be experienced from 

4589 the policy. It is necessary to include the phase-in and phase-out of the benefits in order to be consistent 

4590 with the cost estimates, which reflect the costs of 30 years of production that complies with the emissions 

4591 standards. Given that this analysis assumes that after eleven years any continuing (and declining) 

4592 emissions from a given composite wood product would contribute negligibly to that product's effect on 

4593 formaldehyde exposure, 30 years of production that complies with the emissions standards corresponds to 

4594 40 years of exposure reductions. The first 10 years are a phase-in period for exposure reductions, the next 

4595 20 years are a steady-state, and the next 10 years are a phase-out period. 

4596 

4597 Since the eleventh year is the first steady-state or typical year, undiscounted benefits estimates are 

4598 presented in this section in order to convey the annual benefits from a typical year. In addition, the 

4599 present discounted value for the thirty year stream of benefits and the annualized value for the stream of 

4600 benefits are estimated using discount rates of 3 and 7 percent. Benefits are discounted back to the 

4601 beginning of the 40-year period, as follows: 

4602 

ሻ௧݁ݑܸ݈ܽ ݁݀ݐ݊ݑ݋ܿݏܷ݊݀݅ሺ ෍ൌ ݁ݑܸ݈ܽ ݁݀ݐ݊ݑ݋ܿݏ݅ܦ ݐ݁݊ݏ݁ݎܲ 

ሻ௧݁ݐܽݎ ݐ݊ݑ݋ܿݏ݀݅ ൅ 1ሺ

ସ଴

௧ୀଵ

(29) 

4603 

4604 The benefits for discount rate, d, are annualized over a 30 year period to be consistent with the 

4605 annualized costs using the following formula: 

4606 

ሺܣ݊݊ݑ݈ܽ݅ݖ݁݀ ܤ݁݊. ሻ ൌ ሺܲܦܸସ଴ ௬௘௔௥ ௕௘௡௘௙௜௧௦ ௦௧௥௘௔௠ሻ כ ݀ כ ሺ1 ൅ ݀ሻଷ଴

ሺ1 ൅ ݀ሻଷଵ െ 1 (30) 

4607 

4608 Table 3-22 and Table 3-23 present descriptions of the analytical options and the exposure groups 

4609 with the abbreviations that are used in the results tables below. Table 3-24 summarizes the assumptions 

4610 that differentiate between the lower benefit estimates and the higher benefit estimates. 

4611 
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May 1, 2013 3-70 

Table 3-22: Analytical Options Summary 

Analytical 

Option Description 

Option SE Statutory emissions standards where all wood veneer laminated products are exempt from the 

definition of hardwood plywood 

Option SI Statutory emissions standards where all wood veneer laminated products are included in the 

definition of hardwood plywood 

Option SN Statutory emissions standards where wood veneer laminated products made using NAF resins to 

attach wood veneers to NAF platforms are exempt from the definition of hardwood plywood

Option SC 

Statutory emissions standards where all wood veneer laminated products made with wood veneers 

attached to compliant platforms using no-added formaldehyde (NAF) resins are exempt from the 

definition of hardwood plywood 

Option SCR 

Proposed Option. 

Statutory emissions standards where wood veneer laminated products made with wood veneers 

attached to compliant platforms using NAF resins are exempt from the definition of hardwood 

plywood. Reduced recordkeeping requirements for non-mfgrs.manufacturers compared to other 

options.

Option SEUR

Statutory emissions standards where wood veneer laminated products are exempt from the 

definition of hardwood plywood. ULEF certification allowed. Reduced recordkeeping 

requirements for non-manufacturers.

Option SFCC Statutory emissions standards with regulatory provisions that are fully consistent with CARB 

ATCM.

Option 

SNSCUR:

Proposed Option. 

Statutory emissions standards where all wood veneer laminated products made using NAF resins to 

attachwith wood veneers attached to NAFcompliant platforms using NAF resins are exempt from 

the definition of hardwood plywood. ULEF certification allowed. c Reduced recordkeeping 

requirements for non-mfgrs.

Option CE CARB 1 emissions standards where all wood veneer laminated products are exempt from the 

definition of hardwood plywood

Option CI CARB 1 emissions standards where all wood veneer laminated products are included in the 

definition of hardwood plywood

Option NE NAF emissions standards where all wood veneer laminated products are exempt from the 

definition of hardwood plywood 

Option NI NAF emissions standards where all wood veneer laminated products are included in the definition 

of hardwood plywood 

4612 

Formatted Table

Formatted Table

Formatted Table
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May 1, 2013 3-71 

Table 3-23: Exposure Group Descriptions and Abbreviations Used in Results Tables

Exposure Group Descriptions (and abbreviations) 

Composite Wood Product Source and Age: 

1. New housing construction for 11 ages of the housing (Structure age 0-1 through Structure age 10-11) 

2. Renovated housing for 11 ages of the installed composite wood products (0-1 years post ren. through 10-11 years 

post ren.) 

Structure Type: 

1. New apartment (New Apt) 

2. New manufactured housing (New Man) 

3. New recreational vehicles and camper/trailers (New RV) 

4. New single family attached (New SF Att) 

5. New single family detached (New SF Det) 

6. Renovated apartment (Ren Apt) 

7. Renovated manufactured housing (Ren Man) 

8. Renovated single family attached (Ren SFAtt) 

9. Renovated single family detached (Ren SF Det) 

Climate Zone: 

1. (Zone 1) <2,000 cooling degree days (CDD) and more than 7,000 heating degree days (HDD) 

2. (Zone 2) <2,000 CDD and 5,500 to 7,000 HDD 

3. (Zone 3) <2,000 CDD and 4,000 to 5,499 HDD 

4. (Zone 4) <2,000 CDD and <4,000 HDD. 

5. (Zone 5) >2,000 CDD and <4,000 HDD 

Note: Number of degree days is over a 30 year period. 

Age and Employment Status: 

1. Infants: less than age 2 (Infants 0-1) 

2. Children: aged 2 through 15 (Children 2-15) 

3. Ages 16+; work full-time outside the composite wood products industry (Not CWP Industry) 

4. Ages 16+; work in composite wood products fabrication (Fabricator) 

5. Ages 16+; unemployed or not in the labor force (Retired/Unemployed) 

6. Ages 16+; work part-time outside the composite wood products industry (Part Time) 

4613 

Table 3-24: Summary of Lower and Higher Benefit Estimate Assumptions

Health Outcome Lower Estimate Higher Estimate 

Cancer 

Does not apply age-dependent adjustment 

factor (ADAF) to the inhalation unit risk.a 

Multiplies the inhalation unit risk by a 

lowering factor. b

 

Applies age-dependent adjustment factor (ADAF) 

to the inhalation unit risk.a

Eye Irritation 

Does not include benefits for reductions in 

the indoor average daily concentration 

below 40ppb. 

Includes benefits for any reduction in the indoor 

average daily concentration, including reductions 

below 40ppb. 

Asthma

Includes benefits for 6-17 year olds 

only. The willingness-to-pay (WTP) to 

avoid asthma, which is age-specific, is 

lower for this age group compared to 

the higher estimate.

Includes benefits for 2-17 year olds only. The 

willingness-to-pay (WTP) to avoid asthma, which 

is age-specific, is higher for this age group 

compared to the lower estimate.

Fertility

There is only one fertility estimate presented.

a

 EPA policy is to apply ADAFs when there is a mutagenic mode of action. The 1991 IRIS assessment did not make a 

formal finding of a mutagenic mode of action. However, there is scientific support for a mutagenic mode of action. 

Therefore, EPA believes application of ADAFs is the preferred approach in this case but is also presenting the 

calculations without applying ADAFs. 

b

 The lowering factor is calculated as the percentage of incidence of the cancer that occurs within the age range 

spanning from the age at which the change in exposure is experienced through the end of the expected lifetime. 

4614 

4615 

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

May 1, 2013 3-72 

4616 

4617 3.7.1 Total Benefits Attributable to Cancer Risk Reductions 

4618 

4619 The benefits of reducing the risk of nasopharyngeal cancer isare estimated as a weighted average 

4620 of the value of reducing fatal and nonfatal cancer risks. As noted above (see section 3.4.1), the fifteen 

4621 year survival rate for cancers of the nasopharynx is 42.9 percent (SEER 2010). Thus, the analysis 

4622 assumes that 57.1 percent of the reductions in cancer risk are reductions in mortality risk and therefore are 

4623 valued as the value of mortality risk (VMR) presented in section 3.4.1. Likewise, the analysis assumes 

4624 that 42.9 percent of the cancer risk reductions are reductions in the risk of nonfatal cancer and are valued 

4625 using a cost of illness approach presented in section 3.4.2. The results presented in this section generally 

4626 include the number of individuals experiencing exposure reductions annually as a result of the analytical 

4627 option (see section 3.6), the average individual’s micro risk reduction for cancer (see section 3.3), and the 

4628 total benefits for the reduction in cancer risk. The analysis includes both lower and higher estimates for 

4629 the reduction in cancer risk, where the lower estimate adjusts the cancer risk downward based according 

4630 to the distribution of cancer incidence by age (see section 3.3.1). Note that the value for each micro risk 

4631 reduction for cancer is conditional on the age at the time of the exposure (see Table 3-16). 

4632 

4633 Table 3-25 through Table 3-30 present the annual benefits using a 3 percent discount rate 

4634 associated with reduced cancer risk for a typical year under the analytical options with the statutory 

4635 emissions standards (see Table 3-22 for a description of the analytical options and Table 3-23 for a 

4636 description of the exposure groups). Because the exposure model assumes that the benefits of reduced 

4637 emissions from newly installed composite wood products are accrued over 11 years and the numbers of 

4638 individuals in different exposure groups are assumed to be the same in each year, the annual benefits are 

4639 the same starting in the eleventh year. Thus, the eleventh and subsequent years are defined as typical 

4640 years for the purpose of this analysis. Table 3-31 presents the typical annual benefits, the present 

4641 discounted value of the 40-year stream of benefits, and the annualized benefits associated with reduced 

4642 cancer risk for all analytical options. 

4643 

4644 The results in Table 3-25 through Table 3-30 indicate that the cancer-related benefits are 

4645 generally higher for composite wood products that have been more recently installed, new housing 

4646 compared to renovated housing, warmer and more humid climate zones, younger individuals, and 

4647 individuals who work in the composite wood products industry. 

4648 

4649 The results in Table 3-31 indicate that the most protective option with emissions standards that 

4650 are consistent with the TSCA Title VI statute (Option SN, which would require laminated products to be 

4651 made with both NAF resins and NAF platforms in order to be exempted from the definition of hardwood 

4652 plywood) has cancer-related benefits that are less than 20 percent larger than the benefits of the least 

4653 protective optionoptions with emissions standards that are consistent with the TSCA Title VI statute 

4654 (OptionOptions SE, SEUR, and SFCC, which exemptsexempt all laminated products from the definition 

4655 of hardwood plywood). The cancer-related benefits under Option SI, SC, SCR, and the proposed option 

4656 (Option SCRSCUR) are only slightly less than those under Option SN, the difference being less than 5 

4657 percent. Options SC and, SCR, and SCUR would both require laminated products to be made with NAF 

4658 resins in order to be exempted from the definition of hardwood plywood. Option SI includes laminated 

4659 products in the definition of hardwood plywood. Analytical options that would require NAF resin 

4660 technologies for all composite wood products (Options NE and NI) would result in benefits about four 

4661 times larger than under the proposed analytical option with emissions standards consistent with the TSCA 

4662 Title VI statute, and analytical options that would require less stringent emissions standards than the 

4663 statute (Options CE and CI) would result in benefits about 25 percent lower. 

4664 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-73 

Table 3-25: Cancer Benefits by Composite Wood Source and Age, Annual Benefits for 

Typical Year, Option SE, SEUR, SFCC (3% discount rate) 

Composite Wood 

Source and Age 

Individuals 

Affected 

(thousands) 

Average Micro Risk Reduction 

Per Individual 

Annual Benefit (millions, 2010$) 

Lower 

Estimate 

Higher 

Estimate 

Lower 

Estimate 

Higher 

Estimate 

Structure age 0-1 2,739 0.43 1.08 $2.5 $5.3 

Structure age 1-2 2,739 0.28 0.69 $1.6 $3.4 

Structure age 2-3 2,739 0.18 0.45 $1.0 $2.2 

Structure age 3-4 2,739 0.12 0.29 $0.7 $1.5 

Structure age 4-5 2,739 0.08 0.20 $0.5 $1.0 

Structure age 5-6 2,739 0.06 0.13 $0.3 $0.7 

Structure age 6-7 2,739 0.04 0.10 $0.2 $0.5 

Structure age 7-8 2,739 0.03 0.07 $0.2 $0.4 

Structure age 8-9 2,739 0.03 0.06 $0.2 $0.3 

Structure age 9-10 2,739 0.02 0.05 $0.1 $0.3 

Structure age 10-11 2,739 0.02 0.04 $0.1 $0.2 

0-1 years post-ren. 6,903 0.25 0.60 $3.8 $8.5 

1-2 years post-ren. 6,903 0.16 0.39 $2.5 $5.5 

2-3 years post-ren. 6,903 0.11 0.26 $1.6 $3.6 

3-4 years post-ren. 6,903 0.07 0.17 $1.1 $2.4 

4-5 years post-ren. 6,903 0.05 0.12 $0.8 $1.7 

5-6 years post-ren. 6,903 0.04 0.08 $0.6 $1.2 

6-7 years post-ren. 6,903 0.03 0.06 $0.4 $0.9 

7-8 years post-ren. 6,903 0.02 0.05 $0.4 $0.7 

8-9 years post-ren. 6,903 0.02 0.04 $0.3 $0.6 

9-10 years post-ren. 6,903 0.02 0.04 $0.3 $0.5 

10-11 years post-ren. 6,903 0.02 0.03 $0.3 $0.5 

Total 106,057 0.08 0.20 $19.4 $42.1 

See Table 3-22 for a description of options and Table 3-23 for a description of the exposure group abbreviations. 

4665 

4666 

4667 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-74 

Table 3-26: Cancer Benefits by Composite Wood Source and Age, Annual Benefits for 

Typical Year, Options SI, SC, SCR, and SCRSCUR (Proposed Option, 3% discount rate) 

Composite Wood 

Source and Age 

Individuals 

Affected 

(thousands) 

Average Micro Risk Reduction 

Per Individual 

Annual Benefit (millions, 2010$) 

Lower 

Estimate 

Higher 

Estimate 

Lower 

Estimate 

Higher 

Estimate 

Structure age 0-1 2,739 0.48 1.19 $2.7 $5.9 

Structure age 1-2 2,739 0.31 0.76 $1.7 $3.8 

Structure age 2-3 2,739 0.20 0.49 $1.1 $2.4 

Structure age 3-4 2,739 0.13 0.32 $0.7 $1.6 

Structure age 4-5 2,739 0.09 0.21 $0.5 $1.1 

Structure age 5-6 2,739 0.06 0.15 $0.4 $0.7 

Structure age 6-7 2,739 0.04 0.10 $0.3 $0.5 

Structure age 7-8 2,739 0.03 0.08 $0.2 $0.4 

Structure age 8-9 2,739 0.03 0.06 $0.2 $0.3 

Structure age 9-10 2,739 0.02 0.05 $0.1 $0.3 

Structure age 10-11 2,739 0.02 0.04 $0.1 $0.2 

0-1 years post-ren. 6,903 0.30 0.72 $4.5 $10.2 

1-2 years post-ren. 6,903 0.19 0.46 $2.9 $6.6 

2-3 years post-ren. 6,903 0.13 0.30 $1.9 $4.3 

3-4 years post-ren. 6,903 0.08 0.20 $1.3 $2.9 

4-5 years post-ren. 6,903 0.06 0.14 $0.9 $2.0 

5-6 years post-ren. 6,903 0.04 0.10 $0.6 $1.4 

6-7 years post-ren. 6,903 0.03 0.07 $0.5 $1.0 

7-8 years post-ren. 6,903 0.03 0.05 $0.4 $0.8 

8-9 years post-ren. 6,903 0.02 0.04 $0.3 $0.7 

9-10 years post-ren. 6,903 0.02 0.04 $0.3 $0.6 

10-11 years post-ren. 6,903 0.02 0.03 $0.3 $0.5 

Total 106,057 0.10 0.23 $22.0 $48.0 

See Table 3-22 for a description of options and Table 3-23 for a description of the exposure group abbreviations. 

4668 

4669 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-75 

Table 3-27: Cancer Benefits by Composite Wood Source and Age, Annual Benefits for 

Typical Year, Option SN, 3% discount rate 

Composite Wood 

Source and Age 

Individuals 

Affected 

(thousands) 

Average Micro Risk Reduction 

Per Individual 

Annual Benefit (millions, 2010$) 

Lower 

Estimate 

Higher 

Estimate 

Lower 

Estimate 

Higher 

Estimate 

Structure age 0-1 2,739 0.49 1.23 $2.8 $6.1 

Structure age 1-2 2,739 0.32 0.78 $1.8 $3.9 

Structure age 2-3 2,739 0.20 0.51 $1.2 $2.5 

Structure age 3-4 2,739 0.13 0.33 $0.8 $1.6 

Structure age 4-5 2,739 0.09 0.22 $0.5 $1.1 

Structure age 5-6 2,739 0.06 0.15 $0.4 $0.8 

Structure age 6-7 2,739 0.05 0.11 $0.3 $0.5 

Structure age 7-8 2,739 0.03 0.08 $0.2 $0.4 

Structure age 8-9 2,739 0.03 0.06 $0.2 $0.3 

Structure age 9-10 2,739 0.02 0.05 $0.1 $0.3 

Structure age 10-11 2,739 0.02 0.04 $0.1 $0.2 

0-1 years post-ren. 6,903 0.31 0.76 $4.7 $10.8 

1-2 years post-ren. 6,903 0.20 0.49 $3.1 $6.9 

2-3 years post-ren. 6,903 0.13 0.32 $2.0 $4.5 

3-4 years post-ren. 6,903 0.09 0.21 $1.4 $3.0 

4-5 years post-ren. 6,903 0.06 0.14 $0.9 $2.0 

5-6 years post-ren. 6,903 0.04 0.10 $0.7 $1.4 

6-7 years post-ren. 6,903 0.03 0.07 $0.5 $1.1 

7-8 years post-ren. 6,903 0.03 0.06 $0.4 $0.8 

8-9 years post-ren. 6,903 0.02 0.05 $0.3 $0.7 

9-10 years post-ren. 6,903 0.02 0.04 $0.3 $0.6 

10-11 years post-ren. 6,903 0.02 0.04 $0.3 $0.5 

Total 106,057 0.10 0.24 $22.9 $50.1 

See Table 3-22 for a description of options and Table 3-23 for a description of the exposure group abbreviations. 

4670 

4671 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-76 

Table 3-28: Cancer Benefits for Statutory Options by Structure Type, Annual Benefits for 

Typical Year, 3% discount rate 

Structure Type Individuals 

Affected 

(thousands) 

Average Micro Risk Reduction 

Per Individual 

Annual Benefit (millions, 2010$) 

Lower 

Estimate 

Higher 

Estimate 

Lower 

Estimate 

Higher 

Estimate 

OptionOptions SE, SEUR, and SFCC

New Apt 4,756 0.17 0.38 $1.7 $3.3 

New Man 1,406 0.14 0.35 $0.4 $0.9 

New RV 52 0.26 0.73 $0.0 $0.1 

New SF Att 2,236 0.11 0.26 $0.5 $1.1 

New SF Det 21,679 0.10 0.26 $4.7 $10.2 

Ren Apt 14,786 0.11 0.26 $3.6 $7.4 

Ren Man 2,954 0.11 0.27 $0.7 $1.6 

Ren SF Att 4,045 0.07 0.17 $0.6 $1.4 

Ren SF Det 54,145 0.06 0.14 $7.1 $16.0 

Total 106,057 0.08 0.20 $19.4 $42.1 

Options SI, SC, SCR and SCRSCUR (Proposed Option) 

New Apt 4,756 0.19 0.42 $1.9 $3.7 

New Man 1,406 0.16 0.40 $0.5 $1.1 

New RV 52 0.34 0.96 $0.0 $0.1 

New SF Att 2,236 0.12 0.29 $0.6 $1.2 

New SF Det 21,679 0.11 0.28 $5.1 $11.0 

Ren Apt 14,786 0.13 0.30 $4.1 $8.5 

Ren Man 2,954 0.13 0.34 $0.9 $2.0 

Ren SF Att 4,045 0.08 0.19 $0.7 $1.6 

Ren SF Det 54,145 0.07 0.16 $8.2 $18.7 

Total 106,057 0.10 0.23 $22.0 $48.0 

Option SN 

New Apt 4,756 0.20 0.44 $1.9 $3.8 

New Man 1,406 0.17 0.42 $0.5 $1.1 

New RV 52 0.37 1.04 $0.0 $0.1 

New SF Att 2,236 0.12 0.29 $0.6 $1.2 

New SF Det 21,679 0.12 0.29 $5.2 $11.3 

Ren Apt 14,786 0.14 0.31 $4.3 $8.9 

Ren Man 2,954 0.14 0.36 $0.9 $2.2 

Ren SF Att 4,045 0.09 0.20 $0.8 $1.7 

Ren SF Det 54,145 0.07 0.17 $8.6 $19.6 

Total 106,057 0.10 0.24 $22.9 $50.1 

See Table 3-22 for a description of options and Table 3-23 for a description of the exposure group abbreviations. 

4672 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-77 

Table 3-29: Cancer Benefits for Statutory Options by Climate Zone, Annual Benefits for 

Typical Year, 3% discount rate 

Climate Zone Individuals 

Affected 

(thousands) 

Average Micro Risk Reduction 

Per Individual 

Annual Benefit (millions, 2010$) 

Lower 

Estimate 

Higher 

Estimate 

Lower 

Estimate 

Higher 

Estimate 

OptionOptions SE, SEUR, and SFCC

Zone 1 13,177 0.07 0.17 $2.1 $4.5 

Zone 2 23,907 0.07 0.18 $3.9 $8.4 

Zone 3 20,637 0.08 0.18 $3.4 $7.4 

Zone 4 21,214 0.09 0.21 $4.0 $8.6 

Zone 5 27,122 0.10 0.25 $6.0 $13.1 

Total 106,057 0.08 0.20 $19.4 $42.1 

Options SI, SC, SCR and SCRSCUR (Proposed Option) 

Zone 1 13,177 0.108 0.219 $2.3 $5.1 

Zone 2 23,907 0.08 0.20 $4.4 $9.6 

Zone 3 20,637 0.09 0.20 $3.9 $8.5 

Zone 4 21,214 0.10 0.24 $4.5 $9.8 

Zone 5 27,122 0.12 0.29 $6.8 $15.0 

Total 106,057 0.10 0.23 $22.0 $48.0 

Option SN 

Zone 1 13,177 0.08 0.20 $2.4 $5.3 

Zone 2 23,907 0.09 0.21 $4.6 $10.0 

Zone 3 20,637 0.09 0.21 $4.0 $8.8 

Zone 4 21,214 0.10 0.25 $4.7 $10.2 

Zone 5 27,122 0.12 0.30 $7.1 $15.6 

Total 106,057 0.10 0.24 $22.9 $50.1 

See Table 3-22 for a description of options and Table 3-23 for a description of the exposure group abbreviations. 

4673 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-78 

Table 3-30: Cancer Benefits for Statutory Options by Age/Employment Status, Annual 

Benefits for Typical Year, 3% discount rate 

Age/Employment 

Status 

Individuals 

Affected 

(thousands) 

Average Micro Risk Reduction 

Per Individual

Annual Benefit (millions, 2010$) 

Lower 

Estimate 

Higher 

Estimate 

Lower 

Estimate 

Higher 

Estimate 

OptionOptions SE, SEUR, and SFCC

Infants 0-1 3,309 0.12 1.27 $0.4 $4.4 

Children 2-15 21,312 0.11 0.34 $3.1 $9.6 

Not CWP Industry 55,524 0.08 0.12 $12.0 $18.2 

Fabricator 238 0.32 0.48 $0.2 $0.3 

Retired/Unemployed 19,508 0.05 0.13 $2.6 $7.8 

Part Time 6,166 0.08 0.12 $1.1 $1.7 

Total 106,057 0.08 0.20 $19.4 $42.1 

Options SI, SC, SCR and SCRSCUR (Proposed Option) 

Infants 0-1 3,309 0.14 1.45 $0.5 $5.1 

Children 2-15 21,312 0.12 0.38 $3.5 $10.8 

Not CWP Industry 55,524 0.09 0.13 $13.5 $20.5 

Fabricator 238 0.33 0.50 $0.2 $0.3 

Retired/Unemployed 19,508 0.06 0.15 $3.1 $9.2 

Part Time 6,166 0.09 0.13 $1.3 $2.0 

Total 106,057 0.10 0.23 $22.0 $48.0 

Option SN

Infants 0-1 3,309 0.14 1.51 $0.5 $5.3 

Children 2-15 21,312 0.13 0.40 $3.6 $11.3 

Not CWP Industry 55,524 0.10 0.14 $14.0 $21.3 

Fabricator 238 0.34 0.50 $0.2 $0.3 

Retired/Unemployed 19,508 0.07 0.16 $3.2 $9.7 

Part Time 6,166 0.10 0.14 $1.3 $2.1 

Total 106,057 0.10 0.24 $22.9 $50.1 

See Table 3-22 for a description of options and Table 3-23 for a description of the exposure group abbreviations. 

4674 

4675 

Table 3-31: Cancer Benefits for All Options, Present Discounted Value of 40-Year Stream of 

Benefits and Annualized Benefits (millions 2010$, 3% discount rate) 

Analytical Option Annual Benefits in 

Typical Year 

PDV of 40-Year Stream 

of Benefits 

Annualized Benefits 

Lower 

Estimate 

Higher 

Estimate 

Lower 

Estimate 

Higher 

Estimate 

Lower 

Estimate 

Higher 

Estimate 

OptionOptions SE/SEUR/SFCC $19 $42 $356 $776 $17 $38 

Option SI/SC/SCR/SCUR (Proposed) $22 $48 $405 $887 $20 $43 

Option SN $23 $50 $422 $926 $20 $45 

Option CE $15 $32 $272 $592 $13 $29 

Option CI $17 $37 $311 $680 $15 $33 

Option NE $84 $182 $1,545 $3,359 $75 $163 

Option NI $88 $190 $1,618 $3,523 $79 $171 

See Table 3-22 for a description of options and Table 3-23 for a description of the exposure group abbreviations. 

4676 

4677 

4678 3.7.2 Total Benefits Attributable to Non-cancer Health Effect Risk Reductions 

4679 

4680 The benefits of reducing risk for non-cancer health effects are estimated using the methods 

4681 described in section 3.5. The presented results generally include the number of individuals experiencing 

4682 exposure reductions annually as a result of the analytical option (see section 3.6) and the average 

Formatted Table

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

May 1, 2013 3-79 

4683 individual’s micro risk reduction for the non-cancer health effect. A micro risk reduction represents a 

4684 1/1,000,000 reduction in risk. As described in section 3.5, the benefitsbenefit under a 3 percent discount 

4685 rate from avoiding a case of eye irritation, asthma, and reduced fertility were is $26, $35,443-$66,064, 

4686 and $1,969-$5,336 (depending on age), respectively.. Thus these valuesthis value multiplied by 

4687 1/1,000,000 correspondcorresponds to the valuesvalue for a single micro risk reduction. 

4688 

4689 3.7.2.1 Eye Irritation 

4690 

4691 Table 3-32 through Table 3-37 present the annual benefits using a 3 percent discount rate 

4692 associated with reduced eye irritation risk for a typical year under the analytical options with the statutory 

4693 emissions standards (see Table 3-22 for a description of the analytical options and Table 3-23 for a 

4694 description of the exposure groups). Because the exposure model assumes that the benefits of reduced 

4695 emissions from newly installed composite wood products are accrued over 11 years and the numbers of 

4696 individuals in different exposure groups are assumed to be the same in each year, the annual benefits are 

4697 the same starting in the eleventh year. Thus, the eleventh and subsequent years are defined as typical 

4698 years for the purpose of this analysis. Table 3-38 presents the typical annual benefits, the present 

4699 discounted value of the 40-year stream of benefits, and the annualized benefits associated with reduced 

4700 eye irritation risk for all analytical options. 

4701 

4702 The results in Table 3-32 through Table 3-37 indicate that the eye irritation-related benefits are 

4703 generally higher for composite wood products that have been more recently installed, new housing 

4704 compared to renovated housing, warmer and more humid climate zones, and individuals who work in the 

4705 composite wood products industry. 

4706 

4707 The results in Table 3-38 indicate that the most protective option with emissions standards that 

4708 are consistent with the TSCA Title VI statute (Option SN, which would require laminated products to be 

4709 made with both NAF resins and NAF platforms in order to be exempted from the definition of hardwood 

4710 plywood) has eye irritation-related benefits that are about 9 to 17 percent larger than the benefits of the 

4711 least protective optionoptions with emissions standards that are consistent with the TSCA Title VI statute 

4712 (OptionOptions SE, SEUR, and SFCC, which exemptsexempt all laminated products from the definition 

4713 of hardwood plywood). The eye irritation-related benefits under options SI, SC, SCR, and the proposed 

4714 option (Option SCR, whichSCUR) are only slightly less than those under Option SN, the difference being 

4715 less than 4 percent. Options SC, SCR, and the proposed option (Option SCUR) would require laminated 

4716 products to be made with NAF resins in order to be exempted from the definition of hardwood plywood) 

4717 are only slightly less than those under Option SN, the difference being less than 4 percent., while Option 

4718 SI includes laminated products in the definition of hardwood plywood. Analytical options that would 

4719 require NAF resin technologies for all composite wood products (Options NE and NI) would result in 

4720 benefits that are about three times larger than under the proposed analytical option with emissions 

4721 standards consistent with the TSCA Title VI statute, and analytical options that would require less 

4722 stringent emissions standards than the statute (Options CE and CI) would result in benefits about 20 to 25 

4723 percent lower. 

4724 

4725 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-80 

Table 3-32:: Eye Irritation Benefits by Composite Wood Source and Age, Annual Benefits 

for Typical Year, OptionOptions SE, SEUR, and SFCC (3% discount rate) 

Composite Wood 

Source and Age 

Individuals 

Affected 

(thousands) 

Average Micro Risk Reduction 

Per Individual 

Annual Benefit (millions, 2010$) 

Lower 

Estimate 

Higher 

Estimate 

Lower 

Estimate 

Higher 

Estimate 

Structure age 0-1 2,739 5,739.76 17,934.82 $0.409 $1.277 

Structure age 1-2 2,739 203.22 7,230.14 $0.014 $0.515 

Structure age 2-3 2,739 60.81 3,136.33 $0.004 $0.223 

Structure age 3-4 2,739 49.65 1,491.51 $0.004 $0.106 

Structure age 4-5 2,739 43.18 787.82 $0.003 $0.056 

Structure age 5-6 2,739 39.33 464.81 $0.003 $0.033 

Structure age 6-7 2,739 37.00 305.69 $0.003 $0.022 

Structure age 7-8 2,739 35.56 222.10 $0.003 $0.016 

Structure age 8-9 2,739 34.67 175.79 $0.002 $0.013 

Structure age 9-10 2,739 34.11 149.07 $0.002 $0.011 

Structure age 10-11 2,739 33.77 133.20 $0.002 $0.009 

0-1 years post-ren. 6,903 112.26 5,728.63 $0.020 $1.028 

1-2 years post-ren. 6,903 86.43 2,596.25 $0.016 $0.466 

2-3 years post-ren. 6,903 71.76 1,297.15 $0.013 $0.233 

3-4 years post-ren. 6,903 63.15 720.53 $0.011 $0.129 

4-5 years post-ren. 6,903 57.98 445.52 $0.010 $0.080 

5-6 years post-ren. 6,903 54.82 305.07 $0.010 $0.055 

6-7 years post-ren. 6,903 52.86 228.99 $0.009 $0.041 

7-8 years post-ren. 6,903 51.65 185.82 $0.009 $0.033 

8-9 years post-ren. 6,903 50.89 160.47 $0.009 $0.029 

9-10 years post-ren. 6,903 50.41 145.21 $0.009 $0.026 

10-11 years post-ren. 6,903 50.11 135.89 $0.009 $0.024 

Total 106,057 208.69 1,604.93 $0.575 $4.426 

See Table 3-22 for a description of options and Table 3-23 for a description of the exposure group abbreviations. 

4726 

4727 

4728 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-81 

Table 3-33:: Eye Irritation Benefits by Composite Wood Source and Age, Annual Benefits 

for Typical Year, Options SI, SC, SCR, and SCRSCUR (Proposed Option, 3% discount rate) 

Composite Wood 

Source and Age 

Individuals 

Affected 

(thousands) 

Average Micro Risk Reduction 

Per Individual 

Annual Benefit (millions, 2010$) 

Lower 

Estimate 

Higher 

Estimate 

Lower 

Estimate 

Higher 

Estimate 

Structure age 0-1 2,739 6,217.72 19,737.86 $0.443 $1.406 

Structure age 1-2 2,739 210.18 7,944.66 $0.015 $0.566 

Structure age 2-3 2,739 62.95 3,437.11 $0.004 $0.245 

Structure age 3-4 2,739 50.90 1,627.35 $0.004 $0.116 

Structure age 4-5 2,739 43.93 853.79 $0.003 $0.061 

Structure age 5-6 2,739 39.79 499.08 $0.003 $0.036 

Structure age 6-7 2,739 37.28 324.51 $0.003 $0.023 

Structure age 7-8 2,739 35.74 232.90 $0.003 $0.017 

Structure age 8-9 2,739 34.78 182.18 $0.002 $0.013 

Structure age 9-10 2,739 34.18 152.94 $0.002 $0.011 

Structure age 10-11 2,739 33.81 135.57 $0.002 $0.010 

0-1 years post-ren. 6,903 122.41 6,705.17 $0.022 $1.203 

1-2 years post-ren. 6,903 92.35 3,032.09 $0.017 $0.544 

2-3 years post-ren. 6,903 75.31 1,506.47 $0.014 $0.270 

3-4 years post-ren. 6,903 65.32 828.24 $0.012 $0.149 

4-5 years post-ren. 6,903 59.31 504.27 $0.011 $0.091 

5-6 years post-ren. 6,903 55.65 338.60 $0.010 $0.061 

6-7 years post-ren. 6,903 53.38 248.76 $0.010 $0.045 

7-8 years post-ren. 6,903 51.97 197.75 $0.009 $0.035 

8-9 years post-ren. 6,903 51.09 167.78 $0.009 $0.030 

9-10 years post-ren. 6,903 50.54 149.74 $0.009 $0.027 

10-11 years post-ren. 6,903 50.19 138.71 $0.009 $0.025 

Total 106,057 222.99 1,806.48 $0.615 $4.981 

See Table 3-22 for a description of options and Table 3-23 for a description of the exposure group abbreviations. 

4729 

4730 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-82 

Table 3-34:: Eye Irritation Benefits by Composite Wood Source and Age, Annual Benefits 

for Typical Year, Option SN, 3% discount rate 

Composite Wood 

Source and Age 

Individuals 

Affected 

(thousands) 

Average Micro Risk Reduction 

Per Individual 

Annual Benefit (millions, 2010$) 

Lower 

Estimate 

Higher 

Estimate 

Lower 

Estimate 

Higher 

Estimate 

Structure age 0-1 2,739 6,376.53 20,360.47 $0.454 $1.450 

Structure age 1-2 2,739 211.50 8,191.74 $0.015 $0.583 

Structure age 2-3 2,739 63.70 3,541.31 $0.005 $0.252 

Structure age 3-4 2,739 51.33 1,674.50 $0.004 $0.119 

Structure age 4-5 2,739 44.20 876.73 $0.003 $0.062 

Structure age 5-6 2,739 39.95 511.01 $0.003 $0.036 

Structure age 6-7 2,739 37.38 331.08 $0.003 $0.024 

Structure age 7-8 2,739 35.80 236.67 $0.003 $0.017 

Structure age 8-9 2,739 34.82 184.41 $0.002 $0.013 

Structure age 9-10 2,739 34.21 154.29 $0.002 $0.011 

Structure age 10-11 2,739 33.83 136.40 $0.002 $0.010 

0-1 years post-ren. 6,903 125.94 7,039.10 $0.023 $1.263 

1-2 years post-ren. 6,903 94.42 3,181.77 $0.017 $0.571 

2-3 years post-ren. 6,903 76.55 1,578.67 $0.014 $0.283 

3-4 years post-ren. 6,903 66.07 865.53 $0.012 $0.155 

4-5 years post-ren. 6,903 59.78 524.67 $0.011 $0.094 

5-6 years post-ren. 6,903 55.94 350.27 $0.010 $0.063 

6-7 years post-ren. 6,903 53.56 255.66 $0.010 $0.046 

7-8 years post-ren. 6,903 52.09 201.92 $0.009 $0.036 

8-9 years post-ren. 6,903 51.16 170.33 $0.009 $0.031 

9-10 years post-ren. 6,903 50.59 151.32 $0.009 $0.027 

10-11 years post-ren. 6,903 50.22 139.69 $0.009 $0.025 

Total 106,057 227.75 1,875.87 $0.628 $5.173 

See Table 3-22 for a description of options and Table 3-23 for a description of the exposure group abbreviations. 

4731 

4732 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-83 

Table 3-35:: Eye Irritation Benefits for Statutory Options by Structure Type, Annual 

Benefits for Typical Year, 3% discount rate 

Structure Type Individuals 

Affected 

(thousands) 

Average Micro Risk Reduction 

Per Individual 

Annual Benefit (millions, 2010$) 

Lower 

Estimate 

Higher 

Estimate 

Lower 

Estimate 

Higher 

Estimate 

OptionOptions SE, SEUR, and SFCC

New Apt 4,756 2,051.74 5,159.38 $0.254 $0.638 

New Man 1,406 1,014.86 4,151.36 $0.037 $0.152 

New RV 52 11,928.14 17,386.79 $0.016 $0.024 

New SF Att 2,236 254.44 2,622.20 $0.015 $0.152 

New SF Det 21,679 226.55 2,333.65 $0.128 $1.315 

Ren Apt 14,786 57.48 2,164.15 $0.022 $0.832 

Ren Man 2,954 140.99 1,937.64 $0.011 $0.149 

Ren SF Att 4,045 43.27 1,054.63 $0.005 $0.111 

Ren SF Det 54,145 62.91 747.91 $0.089 $1.053 

Total 106,057 208.69 1,604.93 $0.575 $4.426 

Options SI, SC, SCR, and SCRSCUR (Proposed Option) 

New Apt 4,756 2,199.43 5,731.54 $0.272 $0.709 

New Man 1,406 1,130.49 4,790.85 $0.041 $0.175 

New RV 52 14,647.20 22,139.03 $0.020 $0.030 

New SF Att 2,236 269.06 2,856.59 $0.016 $0.166 

New SF Det 21,679 240.54 2,522.31 $0.136 $1.422 

Ren Apt 14,786 59.90 2,466.91 $0.023 $0.948 

Ren Man 2,954 151.22 2,386.52 $0.012 $0.183 

Ren SF Att 4,045 44.62 1,203.59 $0.005 $0.127 

Ren SF Det 54,145 64.81 867.77 $0.091 $1.222 

Total 106,057 222.99 1,806.48 $0.615 $4.981 

Option SN 

New Apt 4,756 2,250.38 5,929.20 $0.278 $0.733 

New Man 1,406 1,166.51 5,010.67 $0.043 $0.183 

New RV 52 15,302.17 23,687.63 $0.021 $0.032 

New SF Att 2,236 274.12 2,937.91 $0.016 $0.171 

New SF Det 21,679 245.40 2,587.86 $0.138 $1.459 

Ren Apt 14,786 60.75 2,571.04 $0.023 $0.988 

Ren Man 2,954 154.76 2,537.77 $0.012 $0.195 

Ren SF Att 4,045 45.09 1,254.96 $0.005 $0.132 

Ren SF Det 54,145 65.47 909.00 $0.092 $1.280 

Total 106,057 227.75 1,875.87 $0.628 $5.173 

See Table 3-22 for a description of options and Table 3-23 for a description of the exposure group abbreviations. 

4733 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-84 

Table 3-36:: Eye Irritation Benefits for Statutory Options by Climate Zone, Annual Benefits 

for Typical Year, 3% discount rate 

Climate Zone Individuals 

Affected 

(thousands) 

Average Micro Risk Reduction 

Per Individual 

Annual Benefit (millions, 2010$) 

Lower 

Estimate 

Higher 

Estimate 

Lower 

Estimate 

Higher 

Estimate 

OptionOptions SE, SEUR, and SFCC

Zone 1 13,177 93.78 1,169.86 $0.032 $0.401 

Zone 2 23,907 90.38 1,226.80 $0.056 $0.763 

Zone 3 20,637 99.30 1,281.44 $0.053 $0.688 

Zone 4 21,214 175.84 1,658.12 $0.097 $0.915 

Zone 5 27,122 477.73 2,354.12 $0.337 $1.660 

Total 106,057 208.69 1,604.93 $0.575 $4.426 

Options SI, SC, SCR, and SCRSCUR (Proposed Option) 

Zone 1 13,177 98.5 1,316.1 $0.034 $0.451 

Zone 2 23,907 94.93 1,382.86 $0.059 $0.860 

Zone 3 20,637 104.54 1,445.01 $0.056 $0.775 

Zone 4 21,214 186.56 1,862.55 $0.103 $1.027 

Zone 5 27,122 514.96 2,649.27 $0.363 $1.868 

Total 106,057 222.99 1,806.48 $0.615 $4.981 

Option SN 

Zone 1 13,177 100.16 1,366.58 $0.034 $0.468 

Zone 2 23,907 96.50 1,436.66 $0.060 $0.893 

Zone 3 20,637 106.34 1,501.38 $0.057 $0.806 

Zone 4 21,214 190.00 1,932.95 $0.105 $1.066 

Zone 5 27,122 527.32 2,750.74 $0.372 $1.940 

Total 106,057 227.75 1,875.87 $0.628 $5.173 

See Table 3-22 for a description of options and Table 3-23 for a description of the exposure group abbreviations. 

4734 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-85 

Table 3-37:: Eye Irritation Benefits for Statutory Options by Age/Employment Status, 

Annual Benefits for Typical Year, 3% discount rate 

Age/Employment 

Status 

Individuals 

Affected 

(thousands) 

Average Micro Risk Reduction 

Per Individual

Annual Benefit (millions, 2010$) 

Lower 

Estimate 

Higher 

Estimate 

Lower 

Estimate 

Higher 

Estimate 

OptionOptions SE, SEUR, and SFCC

Infants 0-1 3,309 403.55 2,185.76 $0.035 $0.188 

Children 2-15 21,312 88.42 1,532.89 $0.049 $0.849 

Not CWP Industry 55,524 46.85 1,287.54 $0.068 $1.859 

Fabricator 238 26,845.10 26,845.10 $0.166 $0.166 

Retired/Unemployed 19,508 453.31 2,177.11 $0.230 $1.104 

Part Time 6,166 172.96 1,613.61 $0.028 $0.259 

Total 106,057 208.69 1,604.93 $0.575 $4.426 

Options SI, SC, SCR, and SCRSCUR (Proposed Option) 

Infants 0-1 3,309 429.17 2,456.66 $0.037 $0.211 

Children 2-15 21,312 95.31 1,714.52 $0.053 $0.950 

Not CWP Industry 55,524 47.49 1,444.11 $0.069 $2.085 

Fabricator 238 27,758.76 27,758.76 $0.172 $0.172 

Retired/Unemployed 19,508 501.70 2,501.58 $0.254 $1.269 

Part Time 6,166 187.18 1,835.40 $0.030 $0.294 

Total 106,057 222.99 1,806.48 $0.615 $4.981 

Option SN

Infants 0-1 3,309 437.92 2,549.98 $0.038 $0.219 

Children 2-15 21,312 97.65 1,777.13 $0.054 $0.985 

Not CWP Industry 55,524 47.55 1,498.10 $0.069 $2.163 

Fabricator 238 28,077.14 28,077.14 $0.174 $0.174 

Retired/Unemployed 19,508 517.93 2,612.92 $0.263 $1.325 

Part Time 6,166 191.93 1,911.72 $0.031 $0.306 

Total 106,057 227.75 1,875.87 $0.628 $5.173 

See Table 3-22 for a description of options and Table 3-23 for a description of the exposure group abbreviations. 

4735 

4736 

Table 3-38:: Eye Irritation Benefits for All Options, Present Discounted Value of 40-Year Stream 

of Benefits and Annualized Benefits (millions 2010$, 3% discount rate) 

Analytical Option Annual Benefits in 

Typical Year 

PDV of 40-Year Stream 

of Benefits 

Annualized Benefits 

Lower 

Estimate 

Higher 

Estimate 

Lower 

Estimate 

Higher 

Estimate 

Lower 

Estimate 

Higher 

Estimate 

Option SE/SEUR/SFCC $0.6 $4.4 $10.9 $83.9 $0.5 $4.1 

Option SI/SC/SCR/SCUR (Proposed) $0.6 $5.0 $11.7 $94.5 $0.6 $4.6 

Option SN $0.6 $5.2 $11.9 $98.1 $0.6 $4.8 

Option CE $0.5 $3.4 $8.9 $64.3 $0.4 $3.1 

Option CI $0.5 $3.9 $9.7 $73.1 $0.5 $3.5 

Option NE $1.5 $16.3 $27.9 $307.3 $1.4 $14.9 

Option NI $1.5 $16.8 $27.9 $316.6 $1.4 $15.4 

See Table 3-22 for a description of options and Table 3-23 for a description of the exposure group abbreviations. 

4737 

4738 3.7.2.2 Female Fertility

4739 

4740 Formaldehyde’s potential mode of action for reproductive outcome is uncertain. EPA reviewed 

4741 epidemiologic studies that evaluated formaldehyde exposure in relation to fecundability (the per-cycle 

4742 probability of conception). Please see EPA’s Draft Toxicological Review of Formaldehyde – Inhalation 

4743 Assessment through the Integrated Risk Information System (IRIS) Program (U.S. EPA 2010c) and the 

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

May 1, 2013 3-86 

4744 Review of the Environmental Protection Agency's Draft IRIS Assessment of Formaldehyde (NRC 2011) 

4745 for broader treatment of reproductive and developmental toxicity effects of formaldehyde. At this time, 

4746 EPA does not feel that it has sufficient information on the relationship between formaldehye exposure and 

4747 reduced fertility to include a valuation estimate in the overall benefits analysis. 

4748 

4749 Due to the uncertainties in both the concentration-response function and the economic valuation, 

4750 EPA does not feel that it has sufficient information on the relationship between formaldehye exposure and 

4751 reduced fertility to include a valuation estimate in the overall benefits analysis at this time. EPA does feel 

4752 that this effect is an important non-monetized impact which should be recognized as a contribution to the 

4753 overall benefits of this rule. 

4754 

4755 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-87 

4756 3.7.3 Summary of Benefits Assessment Results

4757 

4758 Table 3-39

4759 3.7.2.2 Asthma

4760 

4761 through present the annual benefits using a 3 percent discount rate associated with reduced 

4762 asthma risk for a typical year under the analytical options with the statutory emissions standards (see for 

4763 a description of the analytical options and for a description of the exposure groups). Because the 

4764 exposure model assumes that the benefits of reduced emissions from newly installed composite wood 

4765 products are accrued over 11 years and the numbers of individuals in different exposure groups are 

4766 assumed to be the same in each year, the annual benefits are the same starting in the eleventh year. Thus, 

4767 the eleventh and subsequent years are defined as typical years for the purpose of this analysis. presents 

4768 the typical annual benefits, the present discounted value of the 40-year stream of benefits, and the 

4769 annualized benefits associated with reduced asthma risk for all analytical options.

4770 

4771 The results in through indicate that the asthma -related benefits are generally higher for 

4772 composite wood products that have been more recently installed, new housing compared to renovated 

4773 housing, warmer and more humid climate zones, and individuals who work in the composite wood 

4774 products industry.

4775 

4776 The results in indicate that the most protective option with emissions standards that are 

4777 consistent with the TSCA Title VI statute (Option SN, which would require laminated products to be 

4778 made with both NAF resins and NAF platforms in order to be exempted from the definition of hardwood 

4779 plywood) has asthma-related benefits that are less than 20 percent larger than the benefits of the least 

4780 protective option with emissions standards that are consistent with the TSCA Title VI statute (Option SE, 

4781 which exempts all laminated products from the definition of hardwood plywood). The asthma-related 

4782 benefits under the proposed option (Option SCR, which would require laminated products to be made 

4783 with NAF resins in order to be exempted from the definition of hardwood plywood) are only slightly less 

4784 than those under Option SN, the difference being about 4 percent. Analytical options that would require 

4785 NAF resin technologies for all composite wood products (Options NE and NI) would result in benefits 

4786 that are nearly four times larger than under the proposed analytical option with emissions standards 

4787 consistent with the TSCA Title VI statute, and analytical options that would require less stringent 

4788 emissions standards than the statute (Options CE and CI) would result in benefits about 25 percent lower.

4789 

4790 

4791 presents the average annual number of cases avoided by health outcome and option from an annual 

4792 formaldehyde exposure reduction under the rule. 

4793 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-88 

Table 3-39: Asthma Benefits: Average Annual Number of Cases Avoided by Composite Wood 

SourceHealth Outcome and Age, Annual Benefits for Typical Year, Option SE (3% discount rate)

Composite Wood Source and 

AgeAnalytical Option

Individuals Affected 

(thousands)Cancer

Average Micro Risk 

Reduction Per 

IndividualEye

Irritation

Annual Benefit (millions, 2010$)

lower Estimate

high

er

Estimat

e

lower

Estimate

h

i

g

h

e

r

E

s

t

i

m

a

t

e

Lower 

Estimate

H

i

g

h

e

r

E

s

t

i

m

a

t

e

Structure age 0-1Option 

SE/SEUR/SFCC

4

9

2

9

7

1

8

658.1

1

 

6

5

4

.

5

2

$21.0 $31.122

,133 170,214

Structure age 1-2Option 

SI/SC/SCR/SCUR (Proposed

Option)

49210 7182

4

429.132

3,650

 

4

2

7

.

0

0

1

9

1

,

5

9

0

$13.7 $

2

0

.

3

Structure age 2-3Option SN

49211 7182

5

281.082

4,154

 

2

7

9

.

9

4

1

9

8

,

9

5

0

$9.0 $

1

3

.

3

Formatted Table

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Inserted Cells

Formatted Table

Deleted Cells

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

May 1, 2013 3-89 

Structu

re age 

3-4

492 718 186.28 185.77 $5.9 $8.8

Structu

re age 

4-5

492 718 125.93 125.84 $4.0 $6.0

Structu

re age 

5-6

492 718 87.67 87.84 $2.8 $4.2

Option CE

Structure age 6-77

4921

6

71818,0

15

63.46130,7

20

 63.80 $

2

.

0

$3.0

Option CI

Structure age 7-88

4921

9

71819,5

63

48.17148,3

89

 48.62 $

1

.

5

$2.3

S

t

r

u

c

t

u

r

e

a

g

e

8

-

9

O

p

t

i

o

n

N

E

492 71

8

38.53

39.04 $1.29

2

$1.958,

492 626,726

Structu

re age 

9-10

492 718 32.44 33.00 $1.0 $1.6

Structu

re age 

10-11

492 718 28.61 29.19 $0.9 $1.4

0-1 

years 

postren.

1,12

6

1,48

8 423.28 426.95 $30.9 $42.0

1-2 

years 

postren. 

1,12

6

1,48

8 277.27 279.86 $20.2 $27.5

2-3 years post-ren.Option NI

1,12640

1

,

4

1

8

3

 

185.58,

494

$13.4645,678

$18.2

Inserted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Inserted Cells

Formatted Table

Deleted Cells

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

May 1, 2013 3-90 

8

8

9

7

.

6

9

3-4 

years 

postren.

1,12

6

1,48

8 124.10 125.53 $9.1 $12.3

4-5 

years 

postren.

1,12

6

1,48

8 86.30 87.43 $6.3 $8.6

5-6 

years 

postren.

1,12

6

1,48

8 62.38 63.33 $4.6 $6.2

6-7 

years 

postren.

1,12

6

1,48

8 47.27 48.10 $3.4 $4.7

7-8 

years 

postren.

1,12

6

1,48

8 37.74 38.50 $2.8 $3.8

8-9 

years 

postren.

1,12

6

1,48

8 31.73 32.44 $2.3 $3.2

9-10 

years 

postren.

1,12

6

1,48

8 27.94 28.62 $2.0 $2.8

10-11 

years 

postren.

1,12

6

1,48

8 25.55 26.21 $1.9 $2.6

Total 17,8

02

24,2

70 138.69 139.52 $159.9 $225.7

See Table 3-22 for a description of options and for a description of the exposure group abbreviations.

4794 

4795 Table 3-40 and Table 3-41

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

May 1, 2013 3-91 

Table 3-46: Asthma Benefits by Composite Wood Source and Age, Annual Benefits for 

Typical Year, Options SI, SC, and SCR (Proposed Option, 3% discount rate)

Composite Wood 

Source and Age

Individuals Affected 

(thousands)

Average Micro Risk 

Reduction Per Individual

Annual Benefit (millions, 

2010$)

Lower 

Estimate

Higher

Estimate

Lower 

Estimate

Higher

Estimate

Lower 

Estimate

Higher

Estimate

Structure age 0-1 492 718 720.23 716.05 $23.0 $34.0

Structure age 1-2 492 718 469.70 467.17 $15.0 $22.2

Structure age 2-3 492 718 307.23 305.82 $9.8 $14.5

Structure age 3-4 492 718 202.99 202.31 $6.5 $9.6

Structure age 4-5 492 718 136.55 136.35 $4.4 $6.5

Structure age 5-6 492 718 94.40 94.50 $3.0 $4.5

Structure age 6-7 492 718 67.72 68.01 $2.2 $3.2

Structure age 7-8 492 718 50.86 51.28 $1.6 $2.4

Structure age 8-9 492 718 40.22 40.72 $1.3 $1.9

Structure age 9-10 492 718 33.51 34.06 $1.1 $1.6

Structure age 10-11 492 718 29.28 29.86 $0.9 $1.4

0-1 years post-ren. 1,126 1,488 502.45 506.15 $36.6 $49.8

1-2 years post-ren. 1,126 1,488 328.30 330.92 $23.9 $32.5

2-3 years post-ren. 1,126 1,488 216.31 218.22 $15.8 $21.5

3-4 years post-ren. 1,126 1,488 144.84 146.28 $10.6 $14.4

4-5 years post-ren. 1,126 1,488 99.44 100.58 $7.3 $9.9

5-6 years post-ren. 1,126 1,488 70.69 71.64 $5.2 $7.0

6-7 years post-ren. 1,126 1,488 52.52 53.35 $3.8 $5.2

7-8 years post-ren. 1,126 1,488 41.05 41.81 $3.0 $4.1

8-9 years post-ren. 1,126 1,488 33.81 34.53 $2.5 $3.4

9-10 years post-ren. 1,126 1,488 29.25 29.93 $2.1 $2.9

10-11 years post-ren. 1,126 1,488 26.38 27.04 $1.9 $2.7

Total 17,802 24,270 157.25 158.05 $181.3 $255.2

See Table 3-28 for a description of options and Table 3-29 for a description of the exposure group abbreviations.

4796 

4797 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-92 

Table 3-47: Asthma Benefits by Composite Wood Source and Age, Annual Benefits for 

Typical Year, Option SN, 3% discount rate

Composite Wood 

Source and Age

Individuals Affected 

(thousands)

Average Micro Risk 

Reduction Per Individual

Annual Benefit (millions, 

2010$)

Lower 

Estimate

Higher

Estimate

Lower 

Estimate

Higher

Estimate

Lower 

Estimate

Higher

Estimate

Structure age 0-1 492 718 741.80 737.42 $23.6 $35.0

Structure age 1-2 492 718 483.82 481.15 $15.4 $22.8

Structure age 2-3 492 718 316.35 314.84 $10.1 $14.9

Structure age 3-4 492 718 208.82 208.08 $6.7 $9.9

Structure age 4-5 492 718 140.27 140.02 $4.5 $6.6

Structure age 5-6 492 718 96.75 96.82 $3.1 $4.6

Structure age 6-7 492 718 69.20 69.48 $2.2 $3.3

Structure age 7-8 492 718 51.80 52.21 $1.7 $2.5

Structure age 8-9 492 718 40.81 41.30 $1.3 $2.0

Structure age 9-10 492 718 33.89 34.43 $1.1 $1.6

Structure age 10-11 492 718 29.52 30.09 $0.9 $1.4

0-1 years post-ren. 1,126 1,488 529.92 533.63 $38.7 $52.5

1-2 years post-ren. 1,126 1,488 346.07 348.70 $25.2 $34.3

2-3 years post-ren. 1,126 1,488 227.69 229.60 $16.6 $22.6

3-4 years post-ren. 1,126 1,488 152.08 153.52 $11.1 $15.1

4-5 years post-ren. 1,126 1,488 104.03 105.18 $7.6 $10.3

5-6 years post-ren. 1,126 1,488 73.59 74.55 $5.4 $7.3

6-7 years post-ren. 1,126 1,488 54.35 55.19 $4.0 $5.4

7-8 years post-ren. 1,126 1,488 42.21 42.97 $3.1 $4.2

8-9 years post-ren. 1,126 1,488 34.54 35.26 $2.5 $3.5

9-10 years post-ren. 1,126 1,488 29.71 30.39 $2.2 $3.0

10-11 years post-ren. 1,126 1,488 26.67 27.33 $1.9 $2.7

Total 17,802 24,270 163.72 164.50 $188.8 $265.5

See Table 3-28 for a description of options and Table 3-29 for a description of the exposure group abbreviations.

4798 

4799 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-93 

Table 3-48: Asthma Benefits for Statutory Options by Structure Type, Annual Benefits for 

Typical Year, 3% discount rate

Structure Type Individuals Affected 

(thousands)

Average Micro Risk 

Reduction Per Individual

Annual Benefit (millions, 

2010$)

Lower 

Estimate

Higher

Estimate

Lower 

Estimate

Higher

Estimate

Lower 

Estimate

Higher

Estimate

Option SE

New Apt 556 862 266.14 264.79 $9.6 $15.1

New Man 249 350 237.10 235.72 $3.8 $5.5

New RV 6 7 574.29 569.84 $0.2 $0.3

New SF Att 277 417 183.96 183.23 $3.3 $5.0

New SF Det 4,325 6,266 164.75 163.92 $46.1 $67.9

Ren Apt 1,867 2,765 188.57 188.12 $22.8 $34.4

Ren Man 473 646 192.74 192.42 $5.9 $8.2

Ren SF Att 627 861 122.55 122.06 $5.0 $6.9

Ren SF Det 9,422 12,096 103.46 103.19 $63.1 $82.5

Total 17,802 24,270 138.69 138.19 $159.9 $225.7

Options SI, SC and SCR (Proposed Option)

New Apt 556 862 295.59 294.01 $10.6 $16.7

New Man 249 350 273.92 272.21 $4.4 $6.3

New RV 6 7 738.78 733.05 $0.3 $0.4

New SF Att 277 417 199.77 198.84 $3.6 $5.5

New SF Det 4,325 6,266 177.31 176.30 $49.7 $73.0

Ren Apt 1,867 2,765 215.51 214.88 $26.1 $39.2

Ren Man 473 646 241.27 240.68 $7.4 $10.3

Ren SF Att 627 861 139.77 139.05 $5.7 $7.9

Ren SF Det 9,422 12,096 120.57 120.09 $73.6 $96.0

Total 17,802 24,270 157.25 156.56 $181.3 $255.2

Option SN

New Apt 556 862 305.83 304.17 $11.0 $17.3

New Man 249 350 286.70 284.88 $4.6 $6.6

New RV 6 7 794.08 787.93 $0.3 $0.4

New SF Att 277 417 205.28 204.28 $3.7 $5.6

New SF Det 4,325 6,266 181.70 180.62 $50.9 $74.8

Ren Apt 1,867 2,765 224.88 224.18 $27.2 $40.9

Ren Man 473 646 258.07 257.39 $7.9 $11.0

Ren SF Att 627 861 145.77 144.98 $5.9 $8.2

Ren SF Det 9,422 12,096 126.53 125.99 $77.2 $100.7

Total 17,802 24,270 163.72 162.95 $188.8 $265.5

See Table 3-28 for a description of options and Table 3-29 for a description of the exposure group abbreviations.

4800 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-94 

Table 3-49: Asthma Benefits for Statutory Options by Climate Zone, Annual Benefits for 

Typical Year, 3% discount rate

Climate Zone Individuals Affected 

(thousands)

Average Micro Risk 

Reduction Per Individual

Annual Benefit (millions, 

2010$)

Lower 

Estimate

Higher

Estimate

Lower 

Estimate

Higher

Estimate

Lower 

Estimate

Higher

Estimate

Option SE

Zone 1 2,157 2,935 117.81 120.09 $16.5 $23.3

Zone 2 3,956 5,341 121.47 123.44 $31.1 $43.6

Zone 3 3,294 4,466 125.35 127.16 $26.7 $37.5

Zone 4 3,656 4,999 142.67 144.41 $33.8 $47.7

Zone 5 4,739 6,528 168.76 170.72 $51.8 $73.6

Total 17,802 24,270 138.69 140.62 $159.9 $225.7

Options SI, SC and SCR (Proposed Option)

Zone 1 2,157 2,935 133.7 135.84 $18.7 $26.3

Zone 2 3,956 5,341 138.07 139.91 $35.4 $49.4

Zone 3 3,294 4,466 142.44 144.12 $30.4 $42.5

Zone 4 3,656 4,999 161.55 163.14 $38.3 $53.9

Zone 5 4,739 6,528 190.97 192.76 $58.6 $83.1

Total 17,802 24,270 157.25 159.04 $181.3 $255.2

Option SN

Zone 1 2,157 2,935 139.22 141.33 $19.4 $27.4

Zone 2 3,956 5,341 143.86 145.64 $36.9 $51.4

Zone 3 3,294 4,466 148.40 150.03 $31.7 $44.3

Zone 4 3,656 4,999 168.12 169.66 $39.8 $56.0

Zone 5 4,739 6,528 198.69 200.43 $61.0 $86.4

Total 17,802 24,270 163.72 165.45 $188.8 $265.5

See Table 3-28 for a description of options and Table 3-29 for a description of the exposure group abbreviations.

4801 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-95 

Table 3-50: Asthma Benefits for Statutory Options by Age/Employment Status, Annual 

Benefits for Typical Year, 3% discount rate

Age/Employment 

Status

Individuals Affected 

(thousands)

Average Micro Risk Reduction 

Per Individual

Annual Benefit (millions, 

2010$)

Lower 

Estimate

Higher

Estimate

Lower 

Estimate

Higher

Estimate

Lower 

Estimate

Higher

Estimate

Option SE

Infants 0-1 - - - - - -

Children 2-15 14,844 21,312 137.84 140.45 $132.5 $197.8

Not CWP Industry 499 499 129.14 129.14 $4.2 $4.3

Fabricator 1 1 519.55 519.55 $0.0 $0.0

Retired/Unemployed 1,712 1,712 154.12 154.12 $17.1 $17.4

Part Time 745 745 125.95 125.95 $6.1 $6.2

Total 17,802 24,270 138.69 140.87 $159.9 $225.7

Options SI, SC and SCR (Proposed Option)

Infants 0-1 - - - - - -

Children 2-15 14,844 21,312 155.56 158.28 $149.6 $222.9

Not CWP Industry 499 499 145.82 145.82 $4.7 $4.8

Fabricator 1 1 535.19 535.19 $0.0 $0.0

Retired/Unemployed 1,712 1,712 180.12 180.12 $20.0 $20.4

Part Time 745 745 145.63 145.63 $7.0 $7.2

Total 17,802 24,270 157.25 159.53 $181.3 $255.2

Option SN

Infants 0-1 - - - - - -

Children 2-15 14,844 21,312 161.73 164.49 $155.5 $231.6

Not CWP Industry 499 499 151.64 151.64 $4.9 $5.0

Fabricator 1 1 540.63 540.63 $0.0 $0.0

Retired/Unemployed 1,712 1,712 189.16 189.16 $21.0 $21.4

Part Time 745 745 152.48 152.48 $7.4 $7.5

Total 17,802 24,270 163.72 166.02 $188.8 $265.5

See Table 3-28 for a description of options and Table 3-29 for a description of the exposure group abbreviations.

4802 

4803 

Table 3-51: Asthma Benefits for All Options, Present Discounted Value of 40-Year Stream of 

Benefits and Annualized Benefits (millions 2010$, 3% discount rate)

Analytical Option Annual Benefits in Typical 

Year

PDV of 40-Year Stream of 

Benefits 

Annualized Benefits

Lower 

Estimate

Higher

Estimate

Lower 

Estimate

Higher

Estimate

Lower 

Estimate

Higher

Estimate

Option SE $160 $226 $2,947 $4,158 $143 $202 

Option SI/SC/SCR (Proposed) $181 $255 $3,347 $4,710 $162 $229 

Option SN $189 $266 $3,486 $4,903 $169 $238 

Option CE $123 $174 $2,263 $3,192 $110 $155 

Option CI $140 $197 $2,586 $3,638 $126 $177 

Option NE $619 $874 $11,455 $16,188 $556 $786 

Option NI $646 $912 $11,955 $16,882 $580 $819 

See Table 3-28 for a description of options and Table 3-29 for a description of the exposure group abbreviations.

4804 

4805 3.7.2.3 Infertility

4806 

4807 presents the annual benefits using a 3 percent discount rate associated with reduced infertility 

4808 risk for a typical year under the analytical options with the statutory emissions standards (see for a 

4809 description of the analytical options and for a description of the exposure groups). Because the exposure 

4810 model assumes that the benefits of reduced emissions from newly installed composite wood products are 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-96 

4811 accrued over 11 years and the numbers of individuals in different exposure groups are assumed to be the 

4812 same in each year, the annual benefits are the same starting in the eleventh year. Thus, the eleventh and 

4813 subsequent years are defined as typical years for the purpose of this analysis. presents the typical annual 

4814 benefits, the present discounted value of the 40-year stream of benefits, and the annualized benefits 

4815 associated with reduced infertility risk for all analytical options.

4816 

4817 The results in indicate that the infertility-related benefits are generally higher for composite 

4818 wood products that have been more recently installed, new housing compared to renovated housing, 

4819 warmer and more humid climate zones, and individuals who work in the composite wood products 

4820 industry.

4821 

4822 The results in present the total benefits by health effect and analytical option for 3 and 7 percent 

4823 discount rates, respectively. The results indicate that the most protective option with emissions standards 

4824 that are consistent with the TSCA Title VI statute (Option SN, which would require laminated products to 

4825 be made with both NAF resins and NAF platforms in order to be exempted from the definition of 

4826 hardwood plywood) has infertility-relatedquantified benefits that are less than 20 percent larger than the 

4827 quantified benefits of the least protective option with emissions standards that are consistent with the 

4828 TSCA Title VI statute (Option SE, which exempts all laminated products from the definition of hardwood 

4829 plywood). The infertility-relatedquantified benefits under the proposed option (Option SCR, which 

4830 would require laminated products to be made with NAF resins in order to be exempted from the definition 

4831 of hardwood plywood) are only slightly less than those under Option SN, the difference being less than 4 

4832 percent. Analytical options that would require NAF resin technologies for all composite wood products 

4833 (Options NE and NI) would result in benefits that are about four times larger than under the proposed 

4834 analytical option with emissions standards consistent with the TSCA Title VI statute, and analytical 

4835 options that would require less stringent emissions standards than the statute (Options CE and CI) would 

4836 result in benefits about 25 percent lower.

4837 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-97 

Table 3-52: Infertility Benefits for Statutory Options by Exposure Group, Annual Benefits 

for Typical Year, 3% discount rate

Exposure Group Individuals 

Affected 

(thousands)

Average Micro Risk Reduction 

Per Individual

Annual Benefit (millions, 2010$)

Option 

SE

Options 

SI/SC/SCR

Option 

SN

Option 

SE

Options 

SI/SC/SCR

Option 

SN

Composite Wood Product Source and Age

Structure age 0-1 44 4,970 5,500 5,685 $0.24 $0.27 $0.27

Structure age 1-2 44 3,203 3,537 3,653 $0.15 $0.17 $0.18

Structure age 2-3 44 2,089 2,300 2,373 $0.10 $0.11 $0.11

Structure age 3-4 44 1,388 1,521 1,567 $0.07 $0.07 $0.08

Structure age 4-5 44 946 1,030 1,059 $0.05 $0.05 $0.05

Structure age 5-6 44 668 721 739 $0.03 $0.03 $0.04

Structure age 6-7 44 493 526 537 $0.02 $0.03 $0.03

Structure age 7-8 44 382 403 410 $0.02 $0.02 $0.02

Structure age 8-9 44 313 326 330 $0.02 $0.02 $0.02

Structure age 9-10 44 269 277 280 $0.01 $0.01 $0.01

Structure age 10-11 44 241 246 248 $0.01 $0.01 $0.01

0-1 years post-ren. 79 3,387 4,016 4,236 $0.28 $0.34 $0.35

1-2 years post-ren. 79 2,205 2,601 2,739 $0.18 $0.22 $0.23

2-3 years post-ren. 79 1,460 1,709 1,796 $0.12 $0.14 $0.15

3-4 years post-ren. 79 990 1,147 1,202 $0.08 $0.10 $0.10

4-5 years post-ren. 79 695 793 828 $0.06 $0.07 $0.07

5-6 years post-ren. 79 508 571 592 $0.04 $0.05 $0.05

6-7 years post-ren. 79 391 430 444 $0.03 $0.04 $0.04

7-8 years post-ren. 79 317 342 350 $0.03 $0.03 $0.03

8-9 years post-ren. 79 270 286 291 $0.02 $0.02 $0.02

9-10 years post-ren. 79 241 251 254 $0.02 $0.02 $0.02

10-11 years post-ren. 79 223 229 231 $0.02 $0.02 $0.02

Structure Type

New Apt 110 1,838 2,046 2,118 $0.18 $0.20 $0.21

New Man 19 1,664 1,923 2,014 $0.03 $0.04 $0.04

New RV 0 4,401 5,827 6,326 $0.00 $0.00 $0.00

New SF Att 44 1,278 1,391 1,430 $0.06 $0.06 $0.06

New SF Det 310 1,180 1,275 1,308 $0.45 $0.49 $0.50

Ren Apt 264 1,318 1,505 1,571 $0.34 $0.38 $0.40

Ren Man 32 1,375 1,722 1,844 $0.05 $0.06 $0.06

Ren SF Att 56 906 1,032 1,076 $0.05 $0.06 $0.07

Ren SF Det 518 778 905 949 $0.46 $0.53 $0.56

Climate Zone

Zone 1 161 969 1,094 1,137 $0.16 $0.18 $0.19

Zone 2 292 993 1,123 1,168 $0.32 $0.36 $0.37

Zone 3 259 1,007 1,139 1,185 $0.28 $0.32 $0.33

Zone 4 281 1,134 1,281 1,332 $0.34 $0.39 $0.40

Zone 5 359 1,325 1,499 1,559 $0.51 $0.58 $0.60

Age/Employment Status

Infants 0-1 - - - - - - -

Children 2-15 - - - - - - -

NotCWP Industry 1,046 1,075 1,207 1,253 $1.21 $1.36 $1.41

Fabricator 2 4,087 4,222 4,269 $0.01 $0.01 $0.01

Retired/Unemployed 169 1,284 1,492 1,564 $0.26 $0.30 $0.32

Part Time 134 1,115 1,281 1,339 $0.14 $0.16 $0.16

All Exposure Groups

Total 1,352 1,110 1,255 1,306 $1.62 $1.83 $1.90

See Table 3-28 for a description of options and Table 3-29 for a description of the exposure group abbreviations.
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-98 

4838 

Table 3-53: Infertility Benefits for All Options, Present Discounted Value of 40-Year Stream of 

Benefits and Annualized Benefits (millions 2010$, 3% discount rate)

Analytical Option Annual Benefits in 

Typical Year

PDV of 40-Year Stream 

of Benefits 

Annualized Benefits

Option SE $1.6 $29.8 $1.4 

Option SI/SC/SCR (Proposed) $1.8 $33.8 $1.6 

Option SN $1.9 $35.1 $1.7 

Option CE $1.2 $22.7 $1.1 

Option CI $1.4 $25.8 $1.3 

Option NE $7.1 $131.2 $6.4 

Option NI $7.4 $137.2 $6.7 

See Table 3-28 for a description of options and Table 3-29 for a description of the exposure group abbreviations.

4839 

4840 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-99 

4841 3.7.3 Summary of Benefits Assessment Results

4842 

4843 and present the total benefits by health effect and analytical option for 3 and 7 percent discount 

4844 rates, respectively. The results indicate that the most protective option with emissions standards that are 

4845 consistent with the TSCA Title VI statute (Option SN, which would require laminated products to be 

4846 made with both NAF resins and NAF platforms in order to be exempted from the definition of hardwood 

4847 plywood) has benefits that are less than 20 percent larger than the benefits of the least protective option 

4848 with emissions standards that are consistent with the TSCA Title VI statute (Option SE, which exempts 

4849 all laminated products from the definition of hardwood plywood). The benefits under the proposed option 

4850 (Option SCRSCUR, which would require laminated products to be made with NAF resins in order to be 

4851 exempted from the definition of hardwood plywood) are only slightly lower those of Option SN, the 

4852 difference being less than 5 percent. Analytical options that would require all composite wood products 

4853 to be made with NAF resin technologies (Options NE and NI) would result in quantified benefits nearly 

4854 four times larger than under the analytical options with emissions standards consistent with the TSCA 

4855 Title VI statute and analytical options that would require less stringent emissions standards (Options CE 

4856 and CI) compared to the statute would result in quantified benefits about 25 percent lower. More than 80 

4857 percent of the total monetized benefits are attributable to reductions in cancer risk. 

4858 

4859 About 84 percent of the total benefits are attributable to reductions in asthma risk and about 12 

4860 percent are attributable to reductions in cancer risk. About 2 and 1 percent of the total benefits are 

4861 attributable to avoiding eye irritation and reduced fertility, respectively.

4862 

4863 

4864 There are additional potential unquantified benefits for all of the options from other avoided 

4865 health effects. While EPA has not valued these avoided health effects in this proposal, EPA believes that 

4866 the effects could be substantial and has represented their inclusion in the table below using the letter “B”.

4867 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 3-100 

Table 3-40: Total Benefits for All Options (millions 2010$, 3% discount rate)

Analytical Option Cancer Eye 

Irritation 

Asthma Infertility

Total Benefits 

lower higher lower higher lower higher lower

Annual Benefit for Typical Year

Option SE/SEUR/SFCC $19.4 $42.1 $0.6 $4.4 $159.9 20 +B $225.7 46 +B $1 $181

Option SI/SC/SCR/SCUR (Proposed) $22.0 $48.0 $0.6 $5.0 $181.3 23 +B $255.253 +B $1 $205

Option SN $22.9 $50.1 $0.6 $5.2 $188.824 +B $265.555 +B $1 $214

Option CE $14.8 $32.1 $0.5 $3.4 $123.015 +B $173.536 +B $1 $139

Option CI $16.9 $36.9 $0.5 $3.9 $140.317 +B $197.441 +B $1 $159

Option NE $83.8 $181.6 $1.5 $16.3 $618.785 +B $874.4198 +B $7 $711

Option NI $87.6 $190.3 $1.5 $16.8 $645.689 +BF $911.7207 +B $7 $742

PDV of 40-Year Stream of Benefits 

Option SE/SEUR/SFCC $356 $776 $11 $84 $2,947367 +B $4,158860 +B $ $3,3

Option SI/SC/SCR/SCUR (Proposed) $405 $887 $12 $94 $3,347417 +B $4,710981 +B $ $3,7

Option SN $422 $926 $12 $98 $3,486434 +B $4,9031,024 +B $ $3,9

Option CE $272 $592 $9 $64 $2,263281 +B $3,192656 +B $ $2,5

Option CI $311 $680 $10 $73 $2,586321 +B $3,638753 +B $ $2,9

Option NE $1,545 $3,359 $28 $307 $11,4551,573

+B $16,1883,667 +B $1 $13,1

Option NI $1,618 $3,523 $28 $317 $11,9551,646

+B $16,8823,840 +B $1 $13,7

Annualized Benefits 

Option SE/SEUR/SFCC $17.3 $37.7 $0.5 $4.1 $143.0 18 +B $201.842 +B $1 $162

Option SI/SC/SCR/SCUR (Proposed) $19.7 $43.0 $0.6 $4.6 $162.420 +B $228.748 +B $1 $184

Option SN $20.5 $44.9 $0.6 $4.8 $169.221 +B $238.050 +B $1 $192

Option CE $13.2 $28.7 $0.4 $3.1 $109.914 +B $155.032 +B $1 $124

Option CI $15.1 $33.0 $0.5 $3.5 $125.516 +B $176.637 +B $1 $142

Option NE $75.0 $163.1 $1.4 $14.9 $556.176 +B $785.8178 +B $6 $638

Option NI $78.5 $171.0 $1.4 $15.4 $580.380 +B $819.5186 +B $6 $666

See Table 3-22 for a description of options and for a description of. “BF” represents the exposure group abbreviations.unquantified health benefits. 

4868 

Formatted Table

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

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

May 1, 2013 3-101 

Table 3-41: Total Benefits for All Options (millions 2010$, 7% discount rate)

Analytical Option Cancer Eye 

Irritation 

Asthma Infertility

lower higher lower higher lower high

Annual Benefit for Typical Year

Option SE/SEUR/SFCC $9.6 $20.6 $0.6 $4.4 $87.5 10 B $122.

Option SI/SC/SCR/SCUR (Proposed) $10.9 $23.5 $0.6 $5.0 $99.2 11 

+B

$138.

Option SN $11.3 $24.6 $0.6 $5.2 $103.3 12 

+B

$144.

Option CE $7.3 $15.7 $0.5 $3.4 $67.3 8 +B $94.3 19

Option CI $8.4 $18.1 $0.5 $3.9 $76.8 9 +B $107.

Option NE $41.5 $88.6 $1.5 $16.3 $338.6 43 

+B

$474.9

Option NI $43.5 $93.0 $1.5 $16.8 $353.3 45 

+B

$495.1

PDV of 40-Year Stream of Benefits 

Option SE/SEUR/SFCC $103.5 $223.2 $6.7 $51.0 $950 110 

+B

$1,330

Option SI/SC/SCR/SCUR (Proposed) $118.0 $256.4 $7.2 $5857.5 $1,081 125 

+B

$1,509

Option SN $123.1 $268.0 $7.3 $6059.8 $1,126 130 

+B

$1,572

Option CE $79.0 $170.2 $5.4 $39.1 $728 84 +B $1,019

Option CI $91 $197 $90.6 $45196.7 $8345.9 $1,16444.5 $15 97 +B $946 24

Option NE $451.0 $968967.

6 $16.4 $186.0 $3,711 467 +B

$5,204 1

Option NI $47347

2.6 $1,016.1 $16.4 $192191.7 $3,873 489 +B

$5,428 1

Annualized Benefits 

Option SE/SEUR/SFCC $7.7 $16.6 $0.5 $3.8 $70.8 +B $99.2 20

Option SI/SC/SCR/SCUR (Proposed) $8.8 $19.1 $0.5 $4.3 $80.6 9 +B $112.

Option SN $9.2 $20.0 $0.5 $4.5 $84.0 10 

+B

$117.

Option CE $5.9 $12.7 $0.4 $2.9 $54.3 $76.0 $1.0 $61.6 +B

Option CI $6.8 $14.7 $0.4 $3.3 $62.2 7 +B $86.8 18

Option NE $33.6 $72.2 $1.2 $13.9 $276.7 35 

+B

$388.

Option NI $35.2 $75.8 $1.2 $14.3 $288.9 36 

+B

$404.

See Table 3-22 for a description of options and for a description of. “B” represents the exposure group abbreviationsunquantified health benefits. 

4869 presents the average annual number of cases avoided by health outcome and option from an annual 

4870 formaldehyde exposure reduction under the policy. 

4871 

Formatted Table

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

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

May 1, 2013 3-102 

Table 3-56: Average Annual Number of Cases Avoided by Health Outcome and Option

Analytical Option Cancer Eye

Irritation Asthma Infertility

lower higher lower higher lower higher

Option SE 9 21 22,133 170,214 2,469 3,416 1,501

Option SI/SC/SCR (Proposed) 10 24 23,650 191,590 2,799 3,864 1,696

Option SN 11 25 24,154 198,950 2,915 4,019 1,765

Option CE 7 16 18,015 130,720 1,899 2,627 1,144

Option CI 8 19 19,563 148,389 2,166 2,988 1,301

Option NE 39 92 58,492 626,726 9,554 13,235 6,566

Option NI 40 97 58,494 645,678 9,968 13,800 6,874

See Table 3-28 for a description of options 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 4-1 

4872 4 Net Benefits 

4873 

4874 This chapter evaluates the various analytical options under consideration in terms of their net 

4875 benefits (i.e. benefits minus costs). In reviewing the net benefits, it is important to remember that these 

4876 estimates only partially account for the benefits of the rule; some potentially important groups of benefits 

4877 are excluded from monetization. Evidence for health effects associated with formaldehyde exposure is 

4878 provided by a wide variety of human clinical, epidemiology, and animal studies. In 2010, EPA released 

4879 a draft IRIS assessment of adverse cancer and non-cancer health effects from inhalation of formaldehyde. 

4880 The draft IRIS assessment identified seven categories of non-cancer health outcomes: (1) sensory 

4881 irritation; (2) upper respiratory tract pathology; (3) pulmonary function effects; (4) asthma and allergic 

4882 sensitization (atopy); (5) immune function effects; (6) neurological and behavioral toxicity; and (7) 

4883 developmental and reproductive toxicity. At this time, only three of the non-cancer health effect 

4884 categories weresensory irritation was judged to have sufficient data for quantitative concentration4885 response modeling in support of the benefits assessment: sensory irritation, asthma, and female 

4886 reproductive toxicity.. Therefore, the net benefits estimatesestimate includes monetized benefits for four 

4887 health effects: (1) nasopharyngeal cancer for individuals of all ages, (2)and eye irritation for individuals 

4888 of all ages, (3) asthma. However, because EPA believes that the unquantified benefits for other health

4889 related effects could be substantial, they have been represented in children ages 2 to 17 and 6 to 17, and 

4890 (4) female reproductive toxicity (i.e. reduced fertility) in women ages 20 to 40.the net benefits table with 

4891 the letter “B”. 

4892 

4893 Table 4-1 presents the analytical options that are considered in this economic analysis. The 

4894 analytical options can be grouped into two basic categories. The first category contains analytical options 

4895 with emissions standards at the levels required by TSCA Title VI. Within this category there are several 

4896 different options for how to regulate wood veneer laminated products. The second category contains 

4897 emissions standards other than the levels required by TSCA Title VI. There is one set of options with the 

4898 same emissions standards as Phase 1 of the CARB ATCM, and another set of options requiring all 

4899 products to meet the NAF emissions standards. This document discusses options with alternative 

4900 emissions standards simply for informational purposes. The breadth of the discussion here should not 

4901 necessarily imply that EPA has corresponding flexibility in implementing the statute. 

4902 

4903 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 4-2 

Table 4-1: Analytical Options Considered in the Economic Analysis

Analytical Option a Emissions 

Standards 

Notes a

Analytical options with emissions standards at the levels required by TSCA Title VI b

Option SE: Statutory emissions standards 

where wood veneer laminated products 

are exempt from the definition of 

hardwood plywood 

Hardwood plywood MDF 

Thin MDF

ParticleboardLaminators do not need TPC 

testing or certification. No ULEF 

certification. 

0.05 

ppm

0.11 

ppm

0.13 

ppm

0.09 

ppm

Same emissions 

standards as Phase 2 

of the CARB ATCM. 

Recordkeeping and 

supplier notification 

equivalent to CARB 

ATCM.

Option SI: Statutory 

emissions standards 

where wood veneer 

laminated products are

included in the 

definition of hardwood 

plywood 

Same as above

Same emissions standards as Phase 2 of the CARB ATCM, with a different 

definition of hardwood plywood. Recordkeeping and supplier notification 

equivalent to CARB ATCM.All laminators must have products tested and 

certified by a TPC. No ULEF certification. 

Option SP: Statutory 

emissions standards 

where wood veneer 

laminated products 

other than Custom and 

Architectural Panel 

products are exempt 

from the definition of 

hardwood plywood 

Same as above

Same emissions standards as Phase 2 of the CARB ATCM, with a different 

definition of hardwood plywood. Recordkeeping and supplier notification 

equivalent to CARB ATCM.Only laminators making Custom or Architectural 

panels must have products tested and certified by a TPC. Laminators making 

other products do not need TPC testing or certification. No ULEF 

certification. 

Option SN: Statutory 

emissions standards 

where wood veneer 

laminated products 

made using NAF resins 

to attach wood veneers 

to NAF platforms are 

exempt from the 

definition of hardwood 

plywood

Same as above

Same emissions standards as Phase 2 of the CARB ATCM, with a different 

definition of hardwood plywood. Recordkeeping and supplier notification 

equivalent to CARB ATCM.Laminators using NAF resins to attach wood 

veneers to NAF platforms do not need TPC testing and certification. 

Laminators making other products do not need TPC testing or certification. 

No ULEF certification. 

Option SC: Statutory emissions standards 

where wood veneer laminated products 

made with wood veneers attached to 

compliant platforms using no-added 

formaldehyde (NAF) resins are exempt 

from the definition of hardwood plywood

Laminators using NAF resins to attach wood veneers to compliant platforms 

do not need TPC testing and certification. Laminators making other products 

do not need TPC testing or certification. No ULEF certification. 

Option SCSCR: 

Statutory emissions 

standards where wood 

veneer laminated 

products made with 

wood veneers attached 

to compliant platforms 

using no-added 

formaldehyde (NAF)

resins are exempt from 

the definition of 

hardwood plywood. 

Reduced recordkeeping 

requirements for nonmanufacturers 

compared to other 

options.

Same as above

Same emissions standards as Phase 2 of the CARB ATCM, with a different 

definition of hardwood plywood. Recordkeeping and supplier notification 

equivalent to CARB ATCM.

Laminators using NAF resins to attach wood veneers to compliant platforms 

do not need TPC testing and certification. Laminators making other products 

do not need TPC testing or certification. No ULEF certification. Wholesalers 

and retailers that are not manufacturers under TSCA would only be required 

to keep invoices and bills of lading. No supplier notification required.

Formatted Table

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

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

May 1, 2013 4-3 

Table 4-1: Analytical Options Considered in the Economic Analysis

Option SEUR: Statutory emissions 

standards where wood veneer laminated 

products are exempt from the definition of 

hardwood plywood. ULEF certification 

allowed.c Reduced recordkeeping 

requirements for non-manufacturers.

Laminators do not need TPC testing or certification. ULEF certification 

allowed. Wholesalers and retailers that are not manufacturers under TSCA 

would only be required to keep invoices and bills of lading. No supplier 

notification required.

Option SFCC: Statutory emissions 

standards with regulatory provisions that 

are fully consistent with CARB ATCM.

Tested lots may be shipped before test results are available. Laminators do 

not need TPC testing or certification. ULEF certification allowed. Panel 

producers and fabricators must label products. 

Option SCRSCUR: 

Proposed Option. 

Statutory emissions 

standards where wood 

veneer laminated 

products made with 

wood veneers attached 

to compliant platforms 

using NAF resins are 

exempt from the 

definition of hardwood 

plywood. ULEF 

certification allowed. c 

Reduced recordkeeping 

requirements for nonmfgrs. compared to 

other options. 

Same as above

Same emissions standards as Phase 2 of the CARB ATCM, with a different 

definition of hardwood plywood

DistributorsLaminators using NAF resins to attach wood veneers to compliant 

platforms do not need TPC testing and certification. Other laminators must 

have products tested and certified by a TPC. ULEF certification allowed. 

Wholesalers and retailers that are not manufacturers under TSCA would only 

be required to keep invoices and bills of lading. Other recordkeeping 

equivalent to CARB ATCM. No supplier notification required. 

Analytical options with emissions standards other than the 

levels required by TSCA Title VI 

CARB 

Phase 1 levels d

Option CE: CARB 1 emissions standards 

where wood veneer laminated products 

are exempt from the definition of 

hardwood plywood

Hardwood plywood MDF 

Thin MDF

ParticleboardLaminators do not need TPC 

testing or certification. 

0.08 

ppm

0.21 

ppm

0.21 

ppm

0.18 

ppm

Same emissions 

standards as Phase 1 

of the CARB ATCM. 

Recordkeeping and

supplier notification 

equivalent to CARB 

ATCM.

Option CI: CARB 1 

emissions standards 

where wood veneer 

laminated products are 

included in the 

definition of hardwood 

plywood

Same as above

Same emissions standards as Phase 1 of the CARB ATCM, with a different 

definition of hardwood plywood. Recordkeeping and supplier notification 

equivalent to CARB ATCM.Laminators must have products tested and 

certified by a TPC. 

NAF emission 

levels e

Option NE: NAF emissions standards 

where wood veneer laminated products 

are exempt from the definition of 

hardwood plywood

Laminators do not need TPC testing or certification. 

Option NI: NAF emissions standards 

where all wood veneer laminated products 

are included in the definition of hardwood 

plywood

Laminators must have products tested and certified by a TPC. 

NAF emission levels

Option NE: NAF emissions 

standards where wood veneer 

laminated products are exempt 

from the definition of hardwood 

plywood

Hardwood plywood: 

90% of samples < 0.04 ppm. 

All samples < 0.05 ppm.

MDF and particleboard: 

90% of samples < 0.04 ppm. 

All samples < 0.06 ppmNote: This document discusses 

various options with respect to formaldehyde and composite 

wood products, including emissions standards that are 

different from those set in TSCA Title VI. This document 

Requires all composite wood 

product manufacturers to meet 

NAF emission standards. 

Recordkeeping and supplier 

notification equivalent to 

CARB ATCM.

Formatted Table

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Deleted Cells

Formatted Table

Deleted Cells

Deleted Cells

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

May 1, 2013 4-4 

Table 4-1: Analytical Options Considered in the Economic Analysis

discusses alternative emissions standards simply for 

informational purposes. The breadth of the discussion here 

should not necessarily imply that EPA has corresponding 

flexibility in implementing the statute.

a

 Panel producers must have products tested and certified by a 

TPC under all options. Recordkeeping and supplier 

notification requirements are equivalent to the CARB 

ATCM unless noted otherwise. 

b

 Emission levels for TSCA Title VI standard certification 

(and CARB Phase 2): Hardwood plywood = 0.05 ppm; 

MDF = 0.11 ppm; Thin MDF = 0.13 ppm; Particleboard = 

0.09 ppm.

c Emission levels for ULEF certification with reduced quality 

control testing: Hardwood plywood: 90% of samples < 0.05 

ppm and all samples < 0.05 ppm; MDF: 90% of samples < 

0.06 ppm and all samples < 0.09 ppm; thin MDF: 90% of 

samples < 0.08 ppm and all samples < 0.11 ppm; 

Particleboard: 90% of samples < 0.05 ppm and all samples 

< 0.08 ppm. Emission levels for ULEF certification with 

quarterly TPC test exemption: Hardwood plywood: 90% of 

samples < 0.04 ppm and all samples < 0.05 ppm; MDF: 90% 

of samples < 0.04 ppm and all samples < 0.06 ppm; thin 

MDF: 90% of samples < 0.04 ppm and all samples < 0.06 

ppm; Particleboard: 90% of samples < 0.04 ppm and all 

samples < 0.06 ppm. 

d

 Emission levels for CARB Phase 1: Hardwood plywood = 

0.08 ppm; MDF = 0.21 ppm; Thin MDF = 0.21 ppm; 

Particleboard = 0.18 ppm.

e

 Emission levels for NAF certification: Hardwood plywood: 

90% of samples < 0.04 ppm and all samples < 0.05 ppm; 

MDF and particleboard: 90% of samples < 0.04 ppm and all 

samples < 0.06 ppm. 

Option NI: NAF emissions 

standards where all wood 

veneer laminated products are 

included in the definition of 

hardwood plywood

Same as above

Requires all composite wood product manufacturers 

to meet NAF emission standards, with a different 

definition of hardwood plywood. CARB 

recordkeeping and supplier notification.

Note: This document discusses various options with respect to formaldehyde and composite wood products, 

including emissions standards that are different from those set in TSCA Title VI. This document discusses 

alternative emissions standards simply for informational purposes. The breadth of the discussion here should not 

necessarily imply that EPA has corresponding flexibility in implementing the statute.

4904 

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

May 1, 2013 4-5 

4905 4.1 Discounting and Time Frame for the Analysis 

4906 

4907 This analysis estimates the costs and benefits of each analytical option for a 30-year period of 

4908 composite wood product production. Thus, the estimates of the costs reflect the annualized costs of 30 

4909 years of composite wood production being subject to the rule’s requirements. Likewise, the benefits 

4910 estimates reflect the annualized benefits associated with the formaldehyde exposure reductions resulting 

4911 from 30 years of composite wood production being subject to the rule’s requirements. Both the costs and 

4912 the benefits are discounted using 3 and 7 percent discount rates, so that costs and benefits incurred in the 

4913 future are expressed in present terms that are comparable. Because the timing of the costs and the 

4914 benefits vary, they are annualized to make their comparison easier. An annualized value is the amount 

4915 one would have to pay at the beginning of each time period so that the sum of all payments in present 

4916 value terms equals the original stream of values. 

4917 

4918 The 30-year time frame was selected to be as short as possible while being long enough to 

4919 capture the important effects of the policy. In general, the downside of choosing a longer analysis time 

4920 frame is that uncertainties about both the baseline and policy scenarios increase with time. For example, 

4921 the likelihood that alternative technologies for manufacturing composite wood products might be 

4922 developed increases over time (which could result in different formaldehyde emission rates for products 

4923 and/or different costs for reducing formaldehyde emissions). Similarly, uncertainties about changing 

4924 demographics, medical treatments for adverse health effects, and consumer preferences with respect to 

4925 composite wood products all increase with time. However, selecting a time frame that is too short would 

4926 not capture all of the important effects of the policy scenarios under consideration. 

4927 

4928 The benefits analysis assumes that after eleven years any continuing (and declining) emissions 

4929 from a given composite wood product would contribute negligibly to that product's effect on 

4930 formaldehyde exposure. Thus, composite wood products are assumed to contribute to formaldehyde 

exposure for 11 years.59 4931 Specifically: 

4932 

4933  in the first year only new composite wood products are affected by the policy; 

4934  in the second year new and one-year-old composite wood products are affected by the 

4935 policy; 

4936  in the third year new, one- and two-year-old composite wood products are affected by the 

4937 policy; 

4938  in general, in the nth year, new, one-, two-, three-,..., and (n-1)-year-old composite wood 

4939 products are affected by the policy, for n = 1, 2, ..., 10; and 

4940  in the eleventh and all subsequent years new, one-, two-, three-, four-, five-, six-, seven-, 

4941 eight-, nine-, and ten-year-old composite wood products are affected by the policy. 

4942 

4943 Since the exposure scenarios are defined in part according to the 11 different ages for composite 

wood products, it is not until the 11th 4944 year after the implementation of the rule that benefits are realized 

under every exposure scenario. That is, it is not until the 11th 4945 year after rule implementation that ten-year 

4946 old composite wood products would have been required to be produced in compliance with the emissions 

4947 standards. Thus, the benefits are phased in over a period of eleven years. 

4948 

4949 Similarly, the benefits from a given year of composite wood production will phase-out over time. 

4950 Since the analysis considers the benefits and costs from 30 years of composite wood production, the 

 59 EPA calculated exposures using a 1.5 year emissions half life of formaldehyde from composite wood products With. 

this half life, the emission rate 10 years after new construction would be about 1 % of the initial value, and after 11 

years the emissions would be near zero. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 4-6 

estimated exposures have the following time profile after the 30th 4951 and last year of composite wood 

4952 production considered in the analysis: 

4953 

 in the 31st 4954 year, only one-, two-, three-, four-, five-, six-, seven-, eight-, nine-, and tenyear-old composite wood products are produced before the 31st 4955 year (benefits from new 

4956 composite wood products are produced after year 30 and therefore are not considered in 

4957 the analysis); 

 in the 32nd 4958 year, only two-, three-, four-, five-, six-, seven-, eight-, nine-, and ten-year-old 

composite wood products are produced before the 31st 4959 year (benefits from new and one4960 year old composite wood products are produced after year 30 and therefore are not 

4961 considered in the analysis); 

4962  in general, in the nth year after year 30, only n year-old and older composite wood 

4963 products are produced before year 31, for n = 1, 2, ..., 10; and 

 in the 41st 4964 and all subsequent years, all 11 ages of composite wood products that 

potentially contribute to formaldehyde exposure are produced after the 30th 4965 year and 

4966 therefore are not considered in the analysis. 

4967 

4968 Given this phase-in and phase-out, a time period of thirty years of composite wood production 

4969 was selected so that the first ten years of the policy (when the benefits of the policy are being phased in) 

4970 and the ten years after the 30 years of composite wood production that is analyzed (when the benefits of 

4971 the policy are being phased out) do not obscure the steady state benefits that would be experienced from 

4972 the policy. It is necessary to include the phase-in and phase-out of the benefits in order to be consistent 

4973 with the cost estimates, which reflect the costs of 30 years of production that complies with the emissions 

4974 standards. Given that this analysis assumes that after eleven years any continuing (and declining) 

4975 emissions from a given composite wood product would contribute negligibly to that product's effect on 

4976 formaldehyde exposure, 30 years of production that complies with the emissions standards corresponds to 

4977 40 years of exposure reductions. The first 10 years are a phase-in period for exposure reductions, the next 

4978 20 years are a steady-state, and the next 10 years are a phase-out period. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 4-7 

4979 4.2 Summary of Net Benefits 

4980 

4981 Table 4-2 and Table 4-3 present the total annualized net benefits by analytical option and 

4982 discount rate. The proposed rule (Option SCUR) has quantified net benefits of -$24 million to -$60 

4983 million per year using a 3 percent discount rate, and -$57 million to -$79 million per year using a 7 

4984 percent discount rate. 

4985 

4986 The estimated quantified net benefits under the analytical options that have emissions standards 

4987 that are consistent with TSCA Title VI range from negative $109-$18 million to positive $206-$273

4988 million using a three percent discount rate. Of these analytical options, Option SI is the only option 

4989 where netdifference between quantified benefits are negativeand costs is smallest under the lower 

4990 estimate of netOption SEUR. The next smallest difference between quantified benefits using the three 

4991 percent discount rate. Option SCR (the and costs is under the proposed option) is the only option (Option 

4992 SCUR). Of the analytical options that hashave emissions standards that are consistent with TSCA Title 

4993 VI where both the lower and the higher estimate for net, the largest difference between quantified benefits 

4994 and costs is positive using the 7 percent discount rate. under Option SI (which includes laminated 

4995 products in the definition of hardwood plywood). 

4996 

4997 There are smaller net benefits (smaller positive and larger negative quantified net benefits) under 

4998 Options CE and CI (the analytical options with emissions standards lower than those that are consistent 

4999 with TSCA Title VI). Net benefits are lower under these options because the estimated benefits are 

5000 substantially lower while the estimated costs are only modestly lower (because the costs are largely 

5001 driven by the certification, testing, and chain of custody requirements, which are not affected by the 

5002 emissions standards). 

5003 

5004 ) compared to the proposed option (Option SCUR). The difference between quantified benefits 

5005 and costs is largest under Options NE and NI (which have emissions limits that are more stringent than 

5006 those required by the statute) have substantially higher costs and benefits than the options with emissions 

5007 standards that are consistent with TSCA Title VI. Net benefits are positive under these options using a 3 

5008 percent discount rate, and are positive for the higher estimate of net benefits using a 7 percent discount 

5009 rate but are negative for the lower estimate using a 7 percent discount rate.). 

5010 

5011 There are additional unquantified benefits for all of the options from respiratory and other 

5012 avoided health effects. While EPA has not valued these avoided health effects in this proposal, EPA 

5013 believes that the effects could be substantial and has represented their inclusion in the table below using 

5014 the letter “B”.

5015 

Table 4-2: Total Annualized Costs, Benefits, and Net Benefits for All Options (millions 2010$, 3 

percent discount rate) 

Analytical Option Costs Benefits Net Benefits

Low End 

Estimate

High End 

Estimate

Lower 

Estimate

Higher

Estimate

Lower 

Estimate

Higher

Estimate

Option SE $100 $100 $18 +B $42 +B ($82) +B ($58) +B

Option SI $204 $293 $20 +B $48 +B ($273) +B ($157) +B

Option SP $104 $104 Not estimated Not estimated Not estimated Not estimated

Option SN $128 $137 $21 +B $50 +B ($116) +B ($79) +B

Option SC $112 $121 $20 +B $48 +B ($101) +B ($64) +B

Option SCR $72 $81 $20 +B $48 +B ($61) +B ($24) +B

Option SEUR $60 $60 $18 +B $42 +B ($42) +B ($18) +B

Option SFCC $100 $100 $18 +B $42 +B ($82) +B ($58) +B
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 4-8 

Option SCUR (proposed) $72 $81 $20 +B $48 +B ($60) +B ($24) +B

Option CE $99 $99 $14 +B $32 +B ($86) +B ($67) +B

Option CI $203 $292 $16 +B $37 +B ($277) +B ($167) +B

Option NE $379 $379 $76 +B $178 +B ($303) +B ($201) +B

Option NI $484 $573 $80 +B $186 +B ($493) +B ($297) +B

 Option SCUR is the proposed option. Parentheses indicate negative net benefits.

Lower estimate of net benefits is calculated by subtracting high end cost estimate from lower benefits estimate.

Higher estimate of net benefits is calculated by subtracting low end cost estimate from higher benefits estimate.

 “B” represents the unquantified health benefits.

5016 

5017 

Table 4-3: Total Annualized Costs, Benefits, and Net Benefits for All Options (millions 2010$, 7 

percent discount rate)

Analytical Option 

Costs Benefits Net Benefits 

Low 

EndLower

Estimate 

High End 

Higher 

Estimate 

Lower 

Estimate 

Higher 

Estimate 

Lower 

Estimate

Higher 

 Estimate 

Option SE $100112 $100112 $1628 B $24520 +B $62 ($103)

+B $145 ($91) +B

Option SI $194218 $293311 $184 9 +B $27823 +B ($109)302)

+B $84 ($195) +B

Option SP $104115 $104115 Not estimated Not estimated Not estimated Not estimated 

Option SN $143139 $185148 $19210 +B $28924 +B $7 ($138) +B $146 ($114) +B

Option SC $112123 $121132 $184 9 +B $27823 +B $63 ($123)

+B $166 ($100) +B

Option SCR $80 $89 $9 +B $23 +B ($80) +B ($57) +B

Option SEUR $68 $68 $8 +B $20 +B ($60) +B ($48) +B

Option SFCC $111 $111 $8 +B $20 +B ($103) +B ($91) +B

Option SCRSCUR

(proposed) $7280 $8189 $184 9 +B $27823 +B $103 ($79) +B $206 ($57) +B

Option CE $99111 $99111 $125 6 +B $18816 +B $25 ($104)

+B $89 ($95) +B

Option CI $192217 $292310 $142 7 +B $21418 +B ($150)303)

+B $22 ($199) +B

Option NE $379383 $379383 $639 35 +BF $97086 +B $259 ($348)

+B $591 ($297) +B

Option NI $473490 $573582 $667 36 +B $1,01390 +B $94 ($546)

+B $540 ($400) +B

Option SCRSCUR is the proposed option. Parentheses indicate negative net benefits. 

Lower estimate of net benefits is calculated by subtracting high end cost estimate from lower benefits estimate. 

Higher estimate of net benefits is calculated by subtracting low end cost estimate from higher benefits estimate.

 “B” represents the unquantified health benefits.

5018 

5019 

5020 

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

May 1, 2013 4-9 

Table 4-3: Total Annualized Costs, Benefits, and Net Benefits for All Options (millions 2010$, 7 

percent discount rate)

Analytical Option

Costs Benefits Net Benefits

Lower 

Estimate

Higher 

Estimate

Lower 

Estimate

Higher 

Estimate

Lower 

Estimate

Higher

Estimate

Option SE $112 $112 $80 $121 ($31) $9 

Option SI $208 $311 $91 $137 ($220) ($71)

Option SP $115 $115 Not estimated Not estimated Not estimated Not estimated

Option SN $154 $195 $95 $143 ($99) ($11)

Option SC $123 $132 $91 $137 ($41) $14 

Option SCR (proposed) $81 $89 $91 $137 $2 $57 

Option CE $111 $111 $62 $93 ($49) ($18)

Option CI $207 $310 $71 $106 ($239) ($101)

Option NE $383 $383 $317 $480 ($66) $97 

Option NI $480 $582 $331 $501 ($251) $21 

Option SCR is the proposed option. Parentheses indicate negative net benefits. 

Lower estimate of net benefits is calculated by subtracting high end cost estimate from lower benefits estimate.

Higher estimate of net benefits is calculated by subtracting low end cost estimate from higher benefits estimate.
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 5-1 

5021 5 Small Business Impacts 

5022 

5023 This chapter presents the impact of the costs of the proposed TSCA Title VI Implementation Rule 

5024 on the financial condition of small entities. The Regulatory Flexibility Act (RFA) of 1980, amended by 

5025 the Small Business Regulatory Enforcement Fairness Act (SBREFA) of 1996, requires regulators to 

5026 assess the effects of regulations on small entities including businesses, nonprofit organizations, and 

5027 governments. In some instances, agencies are also required to examine regulatory alternatives that may 

5028 reduce adverse economic effects on significantly impacted small entities. The RFA requires agencies to 

5029 prepare an initial and final regulatory flexibility analysis for each rule unless the Agency certifies that the 

5030 rule will not have a significant economic impact on a substantial number of small entities. The RFA, 

5031 however, does not specifically define “a significant economic impact on a substantial number” of small 

5032 entities. Sections 603 and 604 of the RFA require that regulatory flexibility analyses identify the types, 

5033 and estimate the numbers, of small entities to which the rule will apply; and describe the rule 

5034 requirements to which small entities will be subject and any regulatory alternatives, including exemptions 

5035 and deferral, which would lessen the rule’s burden on small entities. 

5036 

5037 The proposed rule will affect small businesses, but small non-profit organizations or small 

5038 governments are not expected to be affected by the proposed rule because they are not expected to be 

5039 panel producers, fabricators, wholesalers, or importers. Under the Regulatory Flexibility Act (RFA), a 

5040 “small business” is determined by the U.S. Small Business Administration’s regulations at 13 CFR 

5041 121.201 (which create small business size standards using either a sales or employment threshold, 

5042 depending on the nature of the industry), unless an agency establishes an alternate definition. 

5043 

5044 To fulfill the requirements of the RFA, this analysis addresses two basic questions regarding the 

5045 proposed rule: (1) the number and type of small entities potentially affected, and (2) the extent of the 

5046 rule’s potential economic impact on those entities as measured by the cost-to-revenue ratio. This ratio is a 

5047 good measure of entities’ ability to afford the costs attributable to a regulatory requirement, because 

5048 comparing compliance costs to revenues or expenses provides a reasonable indication of the magnitude of 

5049 the regulatory burden relative to a commonly available measure of economic activity. Where regulatory 

5050 costs represent a small fraction of a typical entity’s revenues or expenses, the financial impacts of the 

5051 regulation on such entities may be considered as not significant. The impact ratios are calculated using 

5052 annualized costs, because these costs are more representative of the continuing costs entities face to 

5053 comply with the rule. 

5054 

5055 The small business impacts are presented separately according to the types of requirements they 

5056 are subject to. The number of small firms in the affected NAICS codes (described in Chapter 2) were 

5057 estimated using Census data and SBA’s small business size standards. Table 5-1 presents a summary of 

5058 the number of small firms affected by the rule. Section 5.1 presents the small business impacts for stock 

5059 panel producers. Section 5.2 presents the small business impacts for wood veneer laminated product 

5060 producers. Section 5.3 presents the small business impacts fabricators, wholesalers, and retailers. 

5061 Finally, section 5.4 presents a summary of the small business impacts. 

5062 

5063 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 5-2 

Table 5-1: Summary of Affected Number of Firms 

Employer Status Firm Type Number of 

Affected Firms 

Number of Affected 

Small Firms 

Employers 

Stock Panel Producer 54 31 

Wood Veneer Laminated Product 5,260 5,260 

Fabricator 28,014 27,879 

Wholesale 34,948 34,324 

Retail 247,689 202,630 

All Firms 315,965 270,123 

Nonemployers 

Stock Panel Producer - -

Wood Veneer Laminated Product 2,226 2,226 

Fabricator 44,478 44,478 

Wholesale 50,612 50,612 

Retail 511,359 511,359 

All Firms 608,675 608,675 

All Firms 

Stock Panel Producer 54 31 

Wood Veneer Laminated Product 7,486 7,486 

Fabricator 72,492 72,356 

Wholesale 85,560 84,936 

Retail 759,048 713,988 

All Firms 924,640 878,798 

Note that for the cost estimates presented in Chapter 2, stock panel producer firms were assumed to incur 

separate costs per type of composite panel product. As a result, the number of stock panel producer firms 

reported is higher in Chapter 2 compared to the number reported here. For example, a firm that owns a both 

particleboard mill and an MDF mill is counted twice in Chapter 2, but counted only once here. This is why 

the number of panel producer firms is 62 in Chapter 2 and 54 here. 

5064 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 5-3 

5065 5.1 Small Business Impacts for Stock Panel Producers 

5066 

5067 Table 5-2 presents the number of small stock hardwood plywood, MDF, and particleboard mills 

5068 and firms subject to the TSCA Title VI rule’s requirements for testing and third-party certification. 

5069 (Stock panel producers exclude hardwood plywood producers that are defined as laminated product 

5070 manufacturers under the CARB ATCM. Those firms are discussed in Section 5.2.) The small business 

5071 status of the majority of affected composite panel producing firms was determined using Dun & 

5072 Bradstreet (D&B), an online database containing information on the sales volume, number of employees, 

5073 and primary NAICS of establishments (Dun & Bradstreet 2010). For the remaining firms, the small 

5074 business status was determined using other business information directories, company websites, and 

5075 annual reports. 

5076 

Table 5-2: Stock Panel Producers, by Sector and Small Business Status 

Sector 

Total Number in Industry Number of Small Entities 

Firms Mills Firms Mills 

Stock Hardwood Plywood 32 41 22 22 

Medium Density Fiberboard 14 22 5 5 

Particleboard 16 30 5 7 

Total1 54 90 31 33 

Note: Total does not equal sum of rows because some firms and mills produce more than one product. Note that for the cost 

estimates presented in Chapter 2, firms were assumed to incur separate costs per type of composite panel product. As a result, the 

number of firms reported is higher in Chapter 2 compared to the number reported here. For example, a firm that owns both a 

particleboard mill and an MDF mill is counted twice in Chapter 2, but counted only once here. This is why the number of panel 

producer firms is 62 in Chapter 2 and 54 here. 

Sources: Composite Panel Association 2007, Dun & Bradstreet 2010 

5077 

5078 As indicated in Table 5-2, 31 of the 54 firms (approximately 57 percent of the total) and 33 of the 

5079 90 mills (37 percent) are small. Of these, 22 of the affected small firms (approximately 71 percent) are 

5080 hardwood plywood producers; five are MDF producers, and five are particleboard producers 

5081 (approximately 16 percent each). 

5082 

5083 Table 5-3 summarizes the economic impact to affected small panel producers as a result of the 

5084 TSCA Title VI rule. Firm-specific revenue data from Dun & Bradstreet were available for most small 

5085 firms; where data were not available, revenues were imputed as the average revenue for small firms in the 

5086 corresponding product category. 

5087 

5088 While all affected small firms incur rule familiarization and supplier notification costs due to the 

5089 TSCA Title VI rule, only a fraction will incur costs associated with changing production processes and 

5090 raw materials, or with testing and certification (since most firms already incurred those costs due to the 

5091 CARB ATCM). Per-firm costs for firms with production process, raw materials, and testing and 

5092 certification costs were calculated by dividing the total annualized costs by the number of affected firms. 

5093 

5094 All stock panel mills were assumed to have two product lines, and the baseline certification status 

5095 of their product lines was determined according to CARB’s (2011a) list of certified mills and CARB’s 

5096 (2011c) list of no-added formaldehyde (NAF) and ultra low emitting formaldehyde (ULEF) exemptions. 

5097 For example, if CARB only listed a mill as having Phase 2 (i.e., standard) certification, it was assumed 

5098 that the mill had two product lines with standard certification. As another example, a mill that is listed by 

5099 CARB as Phase 2 certified and also listed as having NAF exempt status would be assumed to have one 

5100 NAF product line and one product line with standard certification. The exception to this is particleboard, 

5101 where it is assumed that 5 of the 25 particleboard mills with standard certification status under the CARB 

5102 ATCM also produce a product line that is not certified under the CARB ATCM. There are only 3 

5103 particleboard mills that are small and have standard certification status under the CARB ATCM. To 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 5-4 

5104 ensure that cost impacts are not understated, the analysis assumed all 3 small particleboard mills with 

5105 standard certification under the CARB ATCM also have a product line that is uncertified in the baseline. 

5106 

5107 The analysis assumes that most mills making products that are not certified or that have ULEF 

5108 certification under the CARB ATCM will seek standard certification under the TSCA Title VI rule. The 

5109 exception is mills that have a product line that is ULEF certified and a product line that is NAF certified 

5110 under the CARB ATCM. These mills are assumed to convert the ULEF product line to NAF, so that both 

5111 product lines will be NAF certified under TSCA Title VI. 

5112 

5113 As indicated in Table 5-3, 2527 small stock panel firms (approximately 8187 percent of the total) 

5114 are expected to experience cost impacts that are less than one percent of their revenues, 53 firms 

5115 (approximately 1610 percent) are expected to experience impacts at levels between one and three percent 

5116 of their revenue, and 1 firm (approximately 3 percent) is expected to be incur costs exceeding three 

5117 percent of their revenue. Total cost impacts ranged from zero to approximately 5.5 percent of firm 

5118 revenues. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 5-5 

Table 5-3: Number of Small Composite Panel Producers, by Product Type, Baseline and PostRule Product Lines, and Impact Level 

Product 

Type 

Baseline Product 

Lines 

(CARB ATCM 

certification) 

Post-Rule 

Product Lines 

(TSCA Title VI 

certification) 

Number 

of 

Affected 

Small 

Firms 

Per-Firm 

Costs 

(thousands

, 2010$) 

Per-Firm 

Revenues 

(thousands, 

2010$) 

Range of 

Impacts 

Number of Firms 

with Impacts 

<1% 1-3% >3

% 

Hardwood 

Plywood 

2 product lines 

without certification 

2 product lines 

with NAF 

certification 

7 $35 

$2,500; 

$4,955; 

$6,200; 

$7,000; 

$7,500; 

$12,000; 

and 

$12,410 

0.3% - 1.4% 6 1 - 

2 product lines with 

ULEF certification 

2 product lines 

with standard 

certification 

4 $704

$2,600; 

$4,600; 

$12,410; 

and 

$20,000 

0.4% - 2.7% 24 2- - 

1 prod. with NAF 

cert.; 1 prod. with 

ULEF cert. 

2 product lines 

with NAF 

certification 

3$4 $12,410 -<0.1% 1 - - 

2 product lines with 

standard 

certification. 

2 product lines 

with standard 

certification 

7 $16 

$2,300; 

$3,700; 

$12,410; 

$12,410; 

$12,410; 

$24,000; 

and 

$30,000 

0.047% - 0. 

61% 7 - - 

2 product lines with 

NAF certification 

2 product lines 

with NAF 

certification 

2 $3.6 

$5,200 

and 

$60,000 

0.006% - 

0.07% 2 - - 

Hardwood 

Plywood & 

Particleboard 

2 HWPW prod. 

without 

certification; 1 PB 

prod. without cert., 

1 PB prod. with 

standard 

certification 

2 HWPW prod. 

with NAF cert.; 

2 PB prod. with 

standard 

certification 

1 $332 $6,000 5.5% - - 1 

Particleboard 

1 prod without cert.; 

1 prod. with 

standard cert. 

2 prod. with 

standard 

certification 

2 $296 

10,411 

and 

$15,000 

2.0% - 2.8% - 2 - 

2 prod. with NAF 

cert. 

2 prod. with 

NAF cert. 1 $3.6 $11,053 0.03% 1 - - 

1 prod. with NAF 

cert.; 1 prod. with 

standard cert. 

1 prod. with 

NAF cert.; 1 

prod. with 

standard cert. 

1 $3.6 $12,803 0.03% 1 - - 

MDF 

2 product lines with 

standard 

certification 

2 product lines 

with standard 

certification 

5 $3.6 

$14,100; 

$14,867; 

$14,867; 

$15,000; 

and 

$15,500 

0.023% - 

0.025% 5 - - 

Total 31 - - 0.0% - 5.5% 2527 53 1 

Notes: Numbers in parentheses represent cost savings. HWPW = hardwood plywood. PB = particleboard. 

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

May 1, 2013 5-6 

5119 5.2 Small Business Impacts for Wood Veneer Laminated Product Producers 

5120 (including firms making products defined as hardwood plywood ) 

5121 

5122 The small business impact analysis for wood veneer laminated product producers (including firms 

5123 making products defined as hardwood plywood under the proposed option) follows four basic steps: (1) 

5124 estimate the number of small firms, (2) estimate the cost per firm, (3) estimate the revenue distribution of 

5125 affected firms, and (4) based on the number of affected firms, the per-firm costs, and the revenue 

5126 distribution, estimate the number of firms by cost-revenue ratio. These steps are described in more detail 

5127 below. 

5128 

5129 5.2.1 Number of Small Laminator Firms 

5130 

5131 Due to the uncertainty in the estimated number and characteristics of wood veneer laminated 

5132 product producers, this analysis assumes that all wood veneer laminated product producers are small. To 

5133 ensure that per-firm costs are not understated, the number of small wood veneer laminated product 

5134 producers is estimated as the lower bound of affected firms from presented in Chapter 2 (i.e., 7,486 

5135 firms). As discussed in Chapter 2, the costs to laminators were estimated in part by estimating the 

5136 consumption of veneer by firms in laminator NAICS codes; using that information to estimate the surface 

5137 area of wood veneer laminated products that are produced; and estimating the production process and raw 

5138 materials costs based on that surface area If the small entity analysis were to use the upper bound for the 

5139 estimated number of laminators (i.e., 13,875 firms), the total costs for changes to production processes 

5140 and raw materials would be spread out over nearly twice as many firms. This would reduce the estimated 

5141 impact per firm. Therefore, using the lower bound estimate of affected firms yields a higher estimate of 

5142 the impact per firm. 

5143 

5144 5.2.2 Per-Firm Costs for Laminators 

5145 

5146 Table 5-4 summarizes the per-firm cost components for wood veneer laminated product 

5147 producers. The per-firm costs associated with rule familiarization, supplier notification, labeling system 

5148 setup, and recordkeeping are estimated by annualizing the per-firm costs presented in Table 2-84, Table 

5149 2-85, and Table 2-86 in Chapter 2. All costs except for recurring recordkeeping costs were estimated as 

5150 an average cost applied to all firms. Recurring recordkeeping costs were estimated to include a fixed cost 

5151 component of 2 hours of labor per firm plus a variable cost estimated as a function of revenue. 

5152 

5153 As described in Chapter 2, the recordkeeping and labeling costs were estimated based on the 

5154 responses to a questionnaire administered to nine fabricator firms. The firms that reported recurring 

5155 recordkeeping costs described these costs as data entry costs, which are costs that are likely to increase 

5156 with the volume of a firm’s sales. Based on revenue data from the Dun and Bradstreet database and other 

5157 publically available sources, the two respondents reporting recurring recordkeeping costs appeared to be 

5158 larger firms that likely have revenues that are significantly larger than the average revenue for affected 

5159 firms. Nevertheless, the costs they reported were still assumed to be the average costs incurred by 

5160 affected firms. For fabricators and wood veneer laminated product manufacturers, the per firm recurring 

5161 recordkeeping cost was estimated to be $12,917, which is $12,290 per year when annualized over 30 

5162 years using a three percent discount rate. For the purpose of the small business analysis, the cost impact 

5163 associated with recurring recordkeeping activities is estimated as a fixed cost per firm associated with 2 

5164 hours of labor plus a variable cost in terms of a percentage of firm revenue. This variable cost is 

5165 calculated such that the average annualized recurring recordkeeping costs are $12,290 per firm incurring 

5166 this cost. The variable portion of the recordkeeping cost is estimated to range from 0.1 percent to 0.8 

5167 percent of average revenues, depending on the NAICS code. 

5168 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 5-7 

5169 The per-firm costs of production process and raw material changes were estimated at the industry 

5170 level as the total annualized cost of the changes divided by the number of wood veneer laminated product 

5171 producers using added-formaldehyde resins in the baseline. In addition, wood veneer laminated product 

5172 manufacturers that are assumed not to switch to NAF resins after rule implementation are estimated to 

5173 incur additional annualized recurring recordkeeping costs of $3,531 per firm (the same as stock panel 

5174 producers). 

5175 

Table 5-4: Annualized Per-Firm Cost Components for Wood Veneer Laminated Product Producers, 

by NAICS 

NAICS Rule 

Familiarization 

Labeling 

Setup 

Production 

Process and Raw 

Material Costs 

RecordkeepingTest

ing and 

Certification

(products defined 

as fabricated 

productshardwood) 

plywood) 

Testing and Certification 

(products defined as 

hardwood) plywood)Basic 

Recordkeeping Additional 

Recordkeeping 

(for products 

defined as 

hardwood 

plywood) Fixed Costs

VariableFi

xed Costs

(Percent 

of 

Average 

Revenues)

Variable Costs

(Percent of 

Average 

Revenues)

321211 

$14.29 $220.97 

$56,470.59 

$47.2760,622

0.1%$47.

27

$60,6220.

1%

$3,530.59 

337110 $2,025.36 0.6% 0.6%

337129 $2,025.36 0.8% 0.8%

337121 $545.17 0.2% 0.2%

337122 $545.17 0.5% 0.5%

337211 $954.43 0.2% 0.2%

337127 $954.43 0.2% 0.2%

337215 $954.43 0.2% 0.2%

321911 $758.19 0.1% 0.1%

337212 $2,857.50 0.4% 0.4%

321999 $2,857.50 0.4% 0.4%

339920 $2,857.50 0.2% 0.2%

339932 $2,857.50 0.3% 0.3%

339992 $2,857.50 0.4% 0.4%

Notes: 

$14.29 is estimated as the initial cost of $294 annualized over 30 years using a 3% discount rate. 

$16.65 is estimated as the initial cost of $169 (material cost) plus $174 (labor cost) annualized over 30 years using a 3% discount rate. 

$220.87 is estimated as the initial cost of $4,552 annualized over 30 years using a 3% discount rate. 

Production process and raw material costs are estimated as the total cost of production for each NAICS divided by the number of laminated product 

producers using added-formaldehyde resins in the baseline. 

Recordkeeping costs for fabricated products are described above in section 5.2.2. 

See Chapter 2 for a description of testing and certification costs. 

$3,530.59 is estimated as the recurring cost of $3,710.72 annualized over 30 years using a 3% discount rate. 

NAICS 321211: Hardwood Veneer and Plywood Manufacturers; 337110: Wood kitchen cabinet and countertop manufacturing; 337129: Wood 

television, radio, and sewing machine cabinet manufacturing; 337121: Upholstered household furniture manufacturing; 337122: Nonupholstered 

wood household furniture manufacturing; 337211: Wood office furniture manufacturing; 337127: Institutional furniture manufacturing; 337215: 

Showcase, partition, shelving, and locker manufacturing; 321911: Wood window and door manufacturing; 337212: Custom architectural 

woodwork and millwork manufacturing; 321999: All other miscellaneous wood product manufacturing; 339920: Sporting and athletic goods 

manufacturing; 339932: Game, toy, and children's vehicle manufacturing; 339992: Musical instrument manufacturing. 

5176 

5177 Costs are calculated separately for four categories of wood veneer laminated product producers, 

5178 depending on the types of costs they are estimated to incur: 

5179 

Formatted Table

Merged Cells

Merged Cells

Merged Cells

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

May 1, 2013 5-8 

5180  Laminators that use NAF resins in the baseline. They are estimated to incur costs for rule 

5181 familiarization, supplier notification, and labeling setup. 

5182 

5183  Laminators that use added-formaldehyde resins in the baseline, switch to NAF resins, and are among 

5184 the fabricators that are not estimated to incur recurring recordkeeping costs (i.e., all fabricators that 

5185 make products sold in California and 89 percent of the fabricators making products that are not sold 

5186 in California). They are estimated to incur costs for rule familiarization, supplier notification, 

5187 labeling setup, and production process and raw material (to switch to NAF resins). 

5188 

5189  Laminators that use added-formaldehyde resins in the baseline, switch to NAF resins, and are among 

5190 the fabricators that are estimated to incur recurring recordkeeping costs (i.e., 11 percent of the 

5191 fabricators making products that are not sold in California). They are estimated to incur costs for rule 

5192 familiarization, supplier notification, labeling setup, production process and raw material (to switch to 

5193 NAF resins), and fabricator recordkeeping. 

5194 

5195  Laminators that continue to use added-formaldehyde resins under the TSCA Title VI rule, so that 

5196 their products are included in the definition of hardwood plywood. (These represent 2 percent of all 

5197 laminators.) They are estimated to incur costs for rule familiarization, supplier notification, labeling 

5198 setup, production process and raw material (to switch to enhanced UF resin systems and low emitting 

5199 platforms), fabricator recordkeeping, testing and certification, and panel producer recordkeeping. 

5200 

5201 In general, the analysis uses a simplifying assumption that firms with the less frequent costs also 

5202 incur the more frequent costs. That is, if 10% of firms incur recordkeeping costs and 5% incur labeling 

5203 costs, the small entity analysis assumes that 5% incur both recordkeeping and labeling costs, and 5% 

5204 incur just recordkeeping costs. The analysis also assumes that all firms with testing and certification costs 

5205 also incur recordkeeping costs due to the TSCA Title VI rule. 

5206 

5207 5.2.3 Revenue Distribution for Affected Laminator Firms 

5208 

5209 Revenue distributions for employer and nonemployer wood veneer laminated product producers 

5210 were estimated at the industry level using data from the 2007 Economic Census and the Census Bureau’s 

5211 2008 Nonemployer Statistics. While employer data were available at the six-digit NAICs level, 

5212 nonemployer data were only available at the three-digit level. As with fabricators, revenues were 

5213 assumed to be uniformly distributed within each revenue bracket, and revenue floors of $20,000 and 

5214 $1,000 were set for employers and nonemployers, respectively. Table 5-5 and Table 5-6 present the 

5215 estimated revenue distributions for employer and nonemployer wood veneer laminated product producers.
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 5-9 

Table 5-5: Estimated Revenue Distribution for Employer Wood Veneer Laminated Product Producers, by NAICS (thousands, 2010$) 

Percentile 

NAICS 

321211 

NAICS 

321911 

NAICS 

321999 

NAICS 

337110 

NAICS 

337121 

NAICS 

337122 

NAICS 

337127 

NAICS 

337129 

NAICS 

337211 

NAICS 

337212 

NAICS 

337215 

NAICS 

339920 

NAICS 

339932 

NAICS 

339992 

1 $50 $27 $23 $23 $25 $22 $27 $22 $27 $27 $50 $23 $22 $22 2 $81 $35 $27 $28 $30 $25 $34 $25 $35 $35 $81 $27 $25 $25 3 $112 $43 $30 $32 $36 $30 $43 $29 $43 $43 $112 $31 $29 $29 4 $136 $51 $34 $37 $42 $33 $51 $31 $51 $51 $136 $36 $31 $31 5 $164 $60 $38 $41 $47 $36 $59 $34 $60 $60 $164 $40 $34 $34 6 $192 $68 $43 $46 $53 $39 $66 $38 $68 $68 $192 $44 $38 $38 7 $216 $76 $47 $50 $60 $43 $74 $41 $76 $76 $216 $48 $41 $41 8 $244 $85 $50 $54 $65 $46 $82 $44 $84 $85 $244 $52 $44 $44 9 $272 $93 $54 $59 $71 $50 $90 $47 $92 $93 $272 $56 $47 $47 

10 $300 $100 $58 $63 $77 $53 $98 $51 $100 $100 $300 $60 $51 $51 11 $324 $124 $62 $68 $82 $56 $116 $53 $116 $124 $324 $64 $54 $54 12 $352 $144 $65 $72 $88 $60 $136 $56 $132 $144 $352 $69 $56 $56 13 $380 $168 $69 $77 $94 $63 $156 $60 $148 $168 $380 $73 $60 $60 14 $404 $188 $73 $81 $99 $66 $176 $63 $168 $188 $404 $77 $63 $63 15 $432 $208 $77 $85 $112 $70 $200 $66 $184 $208 $432 $81 $66 $66 16 $460 $232 $81 $89 $124 $73 $220 $69 $200 $232 $460 $85 $69 $69 17 $484 $252 $85 $94 $136 $77 $240 $72 $216 $252 $484 $89 $72 $72 18 $520 $276 $89 $98 $152 $80 $260 $75 $232 $276 $520 $94 $76 $76 19 $560 $296 $93 $104 $164 $83 $284 $78 $248 $296 $560 $98 $79 $79 20 $600 $320 $97 $116 $176 $87 $304 $81 $264 $320 $600 $108 $81 $81 21 $640 $340 $100 $124 $192 $90 $324 $85 $280 $340 $640 $120 $85 $85 22 $680 $360 $116 $132 $204 $94 $344 $88 $296 $360 $680 $136 $88 $88 23 $720 $384 $128 $144 $216 $97 $364 $91 $316 $384 $720 $148 $91 $91 24 $760 $404 $144 $152 $228 $100 $388 $94 $332 $404 $760 $164 $94 $94 25 $805 $428 $156 $160 $244 $112 $408 $97 $348 $428 $805 $176 $98 $98 26 $845 $448 $172 $168 $256 $124 $428 $100 $364 $448 $845 $192 $104 $104 27 $885 $472 $184 $180 $268 $132 $448 $108 $380 $472 $885 $204 $124 $112 28 $925 $492 $200 $188 $284 $144 $468 $120 $396 $492 $925 $220 $140 $124 29 $965 $520 $212 $196 $296 $156 $492 $128 $412 $520 $965 $232 $160 $136 30 $1,015 $550 $224 $208 $308 $168 $520 $136 $428 $550 $1,015 $248 $180 $148 31 $1,105 $585 $240 $216 $320 $176 $550 $144 $444 $585 $1,105 $260 $200 $156 32 $1,195 $615 $252 $224 $336 $188 $585 $156 $460 $615 $1,195 $276 $220 $168 33 $1,285 $650 $268 $232 $348 $200 $620 $164 $480 $650 $1,285 $288 $240 $180 34 $1,375 $680 $280 $244 $360 $212 $655 $172 $496 $680 $1,375 $300 $256 $192 35 $1,465 $715 $296 $252 $376 $220 $685 $180 $520 $715 $1,465 $316 $276 $204 36 $1,555 $745 $308 $260 $388 $232 $720 $192 $550 $745 $1,555 $328 $296 $212 37 $1,660 $780 $320 $272 $400 $244 $755 $200 $575 $780 $1,660 $344 $316 $224 38 $1,750 $810 $336 $280 $412 $252 $785 $208 $605 $810 $1,750 $356 $336 $236 39 $1,840 $845 $348 $288 $428 $264 $820 $216 $635 $845 $1,840 $372 $356 $248 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 5-10 

Table 5-5: Estimated Revenue Distribution for Employer Wood Veneer Laminated Product Producers, by NAICS (thousands, 2010$) 

Percentile 

NAICS 

321211 

NAICS 

321911 

NAICS 

321999 

NAICS 

337110 

NAICS 

337121 

NAICS 

337122 

NAICS 

337127 

NAICS 

337129 

NAICS 

337211 

NAICS 

337212 

NAICS 

337215 

NAICS 

339920 

NAICS 

339932 

NAICS 

339992 

40 $1,930 $875 $364 $300 $440 $276 $855 $228 $660 $875 $1,930 $384 $372 $260 41 $2,020 $905 $376 $308 $452 $288 $890 $236 $690 $905 $2,020 $400 $392 $268 42 $2,110 $940 $392 $316 $468 $296 $920 $244 $720 $940 $2,110 $412 $412 $280 43 $2,200 $970 $404 $324 $480 $308 $955 $252 $745 $970 $2,200 $428 $432 $292 44 $2,290 $1,000 $420 $336 $492 $320 $990 $264 $775 $1,000 $2,290 $440 $452 $304 45 $2,380 $1,075 $432 $344 $515 $332 $1,060 $272 $805 $1,075 $2,380 $456 $472 $316 46 $2,470 $1,135 $444 $352 $540 $340 $1,135 $280 $830 $1,135 $2,470 $468 $488 $324 47 $2,625 $1,195 $460 $364 $570 $352 $1,225 $288 $860 $1,195 $2,625 $484 $515 $336 48 $2,775 $1,255 $472 $372 $600 $364 $1,300 $300 $890 $1,255 $2,775 $496 $540 $348 49 $2,950 $1,315 $488 $380 $630 $376 $1,390 $308 $915 $1,315 $2,950 $525 $570 $360 50 $3,100 $1,375 $500 $388 $660 $384 $1,480 $316 $945 $1,375 $3,100 $560 $595 $372 51 $3,275 $1,435 $540 $400 $690 $396 $1,555 $324 $975 $1,435 $3,275 $595 $625 $380 52 $3,425 $1,495 $580 $408 $715 $408 $1,645 $336 $1,015 $1,495 $3,425 $630 $655 $392 53 $3,600 $1,555 $620 $416 $745 $420 $1,720 $344 $1,105 $1,555 $3,600 $665 $680 $404 54 $3,775 $1,630 $660 $428 $775 $428 $1,810 $352 $1,195 $1,630 $3,775 $700 $710 $416 55 $3,925 $1,690 $700 $436 $805 $440 $1,885 $360 $1,285 $1,690 $3,925 $735 $735 $428 56 $4,100 $1,750 $740 $444 $835 $452 $1,975 $372 $1,390 $1,750 $4,100 $770 $765 $436 57 $4,250 $1,810 $780 $456 $860 $460 $2,065 $380 $1,480 $1,810 $4,250 $805 $795 $448 58 $4,425 $1,870 $820 $464 $890 $472 $2,140 $388 $1,570 $1,870 $4,425 $840 $820 $460 59 $4,575 $1,930 $860 $472 $920 $484 $2,230 $396 $1,675 $1,930 $4,575 $870 $850 $472 60 $4,750 $1,990 $900 $480 $950 $496 $2,305 $408 $1,765 $1,990 $4,750 $905 $875 $484 61 $4,900 $2,050 $940 $492 $980 $515 $2,395 $416 $1,855 $2,050 $4,900 $940 $905 $492 62 $5,125 $2,110 $975 $500 $1,015 $550 $2,470 $424 $1,960 $2,110 $5,125 $975 $935 $520 63 $5,425 $2,185 $1,045 $535 $1,105 $585 $2,675 $432 $2,050 $2,185 $5,425 $1,030 $960 $565 64 $5,700 $2,245 $1,135 $565 $1,195 $615 $2,900 $444 $2,140 $2,245 $5,700 $1,135 $990 $610 65 $6,000 $2,305 $1,240 $600 $1,285 $650 $3,125 $452 $2,230 $2,305 $6,000 $1,240 $1,060 $655 66 $6,300 $2,365 $1,345 $630 $1,375 $680 $3,375 $460 $2,335 $2,365 $6,300 $1,345 $1,165 $700 67 $6,575 $2,425 $1,435 $665 $1,465 $715 $3,600 $468 $2,425 $2,425 $6,575 $1,435 $1,270 $745 68 $6,875 $2,485 $1,540 $700 $1,555 $750 $3,825 $480 $2,550 $2,485 $6,875 $1,540 $1,375 $790 69 $7,175 $2,725 $1,630 $730 $1,645 $780 $4,075 $488 $2,775 $2,725 $7,175 $1,645 $1,480 $840 70 $7,450 $2,975 $1,735 $765 $1,735 $815 $4,300 $496 $3,000 $2,975 $7,450 $1,750 $1,585 $885 71 $8,200 $3,250 $1,825 $795 $1,825 $845 $4,525 $525 $3,225 $3,250 $8,200 $1,855 $1,690 $930 72 $9,050 $3,525 $1,930 $830 $1,915 $880 $4,775 $565 $3,450 $3,525 $9,050 $1,960 $1,795 $975 73 $9,875 $3,800 $2,035 $865 $2,005 $915 $5,000 $605 $3,675 $3,800 $9,875 $2,065 $1,900 $1,060 74 $10,700 $4,050 $2,125 $895 $2,095 $945 $5,500 $650 $3,900 $4,050 $10,700 $2,155 $2,005 $1,180 75 $11,550 $4,325 $2,230 $930 $2,185 $980 $6,025 $690 $4,125 $4,325 $11,550 $2,260 $2,110 $1,300 76 $12,400 $4,600 $2,320 $960 $2,275 $1,045 $6,525 $730 $4,350 $4,600 $12,400 $2,365 $2,215 $1,420 77 $13,250 $4,875 $2,425 $995 $2,365 $1,165 $7,025 $770 $4,600 $4,875 $13,250 $2,470 $2,320 $1,540 78 $14,050 $5,250 $2,575 $1,090 $2,455 $1,285 $7,575 $815 $4,825 $5,250 $14,050 $2,725 $2,425 $1,660 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 5-11 

Table 5-5: Estimated Revenue Distribution for Employer Wood Veneer Laminated Product Producers, by NAICS (thousands, 2010$) 

Percentile 

NAICS 

321211 

NAICS 

321911 

NAICS 

321999 

NAICS 

337110 

NAICS 

337121 

NAICS 

337122 

NAICS 

337127 

NAICS 

337129 

NAICS 

337211 

NAICS 

337212 

NAICS 

337215 

NAICS 

339920 

NAICS 

339932 

NAICS 

339992 

79 $14,900 $5,750 $2,900 $1,195 $2,675 $1,390 $8,375 $855 $5,100 $5,750 $14,900 $3,075 $2,575 $1,780 80 $16,350 $6,250 $3,200 $1,300 $3,025 $1,510 $9,200 $895 $5,675 $6,250 $16,350 $3,400 $2,875 $1,900 81 $17,800 $6,750 $3,525 $1,405 $3,375 $1,630 $10,000 $940 $6,225 $6,750 $17,800 $3,725 $3,150 $2,020 82 $19,300 $7,250 $3,825 $1,510 $3,725 $1,750 $11,250 $980 $6,800 $7,250 $19,300 $4,075 $3,450 $2,140 83 $21,200 $7,875 $4,150 $1,615 $4,075 $1,870 $12,450 $1,075 $7,350 $7,875 $21,200 $4,400 $3,750 $2,260 84 $23,450 $8,675 $4,450 $1,720 $4,450 $1,990 $13,650 $1,195 $7,900 $8,675 $23,450 $4,725 $4,050 $2,380 85 $26,350 $9,450 $4,775 $1,825 $4,800 $2,110 $14,850 $1,330 $8,425 $9,450 $26,350 $5,150 $4,325 $2,525 86 $30,800 $10,650 $5,200 $1,930 $5,400 $2,215 $16,600 $1,465 $8,975 $10,650 $30,800 $5,850 $4,625 $2,925 87 $35,200 $12,750 $5,875 $2,035 $6,275 $2,335 $18,400 $1,600 $9,500 $12,750 $35,200 $6,550 $4,925 $3,350 88 $38,550 $14,850 $6,575 $2,140 $7,175 $2,455 $20,950 $1,735 $10,150 $14,850 $38,550 $7,250 $5,750 $3,750 89 $43,800 $17,900 $7,250 $2,245 $8,550 $2,825 $27,050 $1,870 $11,950 $17,900 $43,800 $8,600 $6,800 $4,175 90 $51,200 $21,500 $8,150 $2,350 $10,200 $3,350 $31,150 $1,990 $13,750 $21,500 $51,200 $10,450 $7,800 $4,575 91 $67,400 $26,550 $9,175 $2,455 $12,100 $3,850 $35,800 $2,125 $16,500 $26,550 $67,400 $12,500 $8,700 $5,000 92 $85,600 $33,550 $10,500 $2,800 $14,000 $4,375 $51,500 $2,260 $21,250 $33,550 $85,600 $14,550 $9,575 $6,250 93 $100,000 $41,400 $13,150 $3,325 $17,500 $4,900 $63,800 $2,395 $26,200 $41,400 $100,000 $17,350 $11,200 $7,550 94 $100,000 $63,800 $16,300 $3,850 $22,950 $6,000 $76,100 $2,650 $32,100 $63,800 $100,000 $20,600 $13,450 $9,250 95 $100,000 $100,000 $21,150 $4,400 $28,650 $7,275 $94,600 $3,325 $48,500 $100,000 $100,000 $27,850 $17,150 $14,250 96 $100,000 $100,000 $31,500 $4,925 $37,350 $9,550 $100,000 $4,000 $70,700 $100,000 $100,000 $39,000 $23,900 $18,450 97 $100,000 $100,000 $46,550 $6,500 $61,400 $14,950 $100,000 $4,700 $99,000 $100,000 $100,000 $95,000 $43,450 $34,100 98 $100,000 $100,000 $97,000 $9,425 $100,000 $24,000 $100,000 $6,900 $100,000 $100,000 $100,000 $100,000 $70,700 $48,800 99 $100,000 $100,000 $100,000 $20,150 $100,000 $79,700 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $98,800 

100 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 

Note: NAICS 321211: Hardwood Veneer and Plywood Manufacturers; 337110: Wood kitchen cabinet and countertop manufacturing; 337129: Wood television, radio, and sewing machine cabinet manufacturing; 337121: Upholstered household furniture manufacturing; 337122: Nonupholstered wood household furniture manufacturing; 337211: Wood office furniture manufacturing; 337127: 

Institutional furniture manufacturing; 337215: Showcase, partition, shelving, and locker manufacturing; 321911: Wood window and door manufacturing; 337212: Custom architectural woodwork and millwork 

manufacturing; 321999: All other miscellaneous wood product manufacturing; 339920: Sporting and athletic goods manufacturing; 339932: Game, toy, and children's vehicle manufacturing; 339992: Musical 

instrument manufacturing. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 5-12 

Table 5-6: Estimated Revenue Distribution for Nonemployer Wood Veneer 

Laminated Product Producers, by NAICS 

Percentile NAICS 321 NAICS 337 NAICS 339 

1 $1,138 $1,179 $1,098 

2 $1,259 $1,339 $1,219 

3 $1,420 $1,540 $1,380 

4 $1,581 $1,701 $1,500 

5 $1,742 $1,902 $1,621 

6 $1,862 $2,103 $1,742 

7 $2,023 $2,264 $1,902 

8 $2,184 $2,465 $2,023 

9 $2,345 $2,626 $2,144 

10 $2,465 $2,827 $2,264 

11 $2,626 $2,988 $2,425 

12 $2,787 $3,189 $2,546 

13 $2,908 $3,390 $2,667 

14 $3,069 $3,551 $2,787 

15 $3,230 $3,752 $2,948 

16 $3,390 $3,913 $3,069 

17 $3,511 $4,114 $3,189 

18 $3,672 $4,315 $3,310 

19 $3,833 $4,476 $3,471 

20 $3,994 $4,677 $3,591 

21 $4,114 $4,838 $3,712 

22 $4,275 $5,050 $3,833 

23 $4,436 $5,400 $3,953 

24 $4,557 $5,750 $4,114 

25 $4,717 $6,050 $4,235 

26 $4,878 $6,400 $4,356 

27 $5,050 $6,700 $4,476 

28 $5,350 $7,050 $4,637 

29 $5,650 $7,350 $4,758 

30 $5,950 $7,699 $4,878 

31 $6,250 $7,999 $5,050 

32 $6,600 $8,349 $5,300 

33 $6,900 $8,699 $5,600 

34 $7,200 $8,999 $5,900 

35 $7,500 $9,349 $6,200 

36 $7,799 $9,649 $6,450 

37 $8,099 $10,000 $6,750 

38 $8,399 $10,600 $7,050 

39 $8,699 $11,200 $7,350 

40 $8,999 $11,950 $7,599 

41 $9,299 $12,550 $7,899 

42 $9,649 $13,150 $8,199 

43 $9,949 $13,750 $8,499 

44 $10,450 $14,500 $8,799 

45 $11,200 $15,100 $9,049 

46 $11,800 $15,700 $9,349 

47 $12,550 $16,300 $9,649 

48 $13,150 $17,050 $9,949 

49 $13,900 $17,649 $10,450 

50 $14,500 $18,249 $11,200 

51 $15,250 $18,849 $11,950 

52 $15,850 $19,599 $12,550 

53 $16,600 $20,199 $13,300 

54 $17,200 $20,799 $13,900 

55 $17,949 $21,399 $14,650 

56 $18,549 $22,149 $15,250 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 5-13 

Table 5-6: Estimated Revenue Distribution for Nonemployer Wood Veneer 

Laminated Product Producers, by NAICS 

Percentile NAICS 321 NAICS 337 NAICS 339 

57 $19,299 $22,749 $16,000 

58 $19,899 $23,349 $16,750 

59 $20,499 $23,949 $17,350 

60 $21,249 $24,699 $18,099 

61 $21,849 $25,750 $18,699 

62 $22,599 $27,000 $19,449 

63 $23,199 $28,500 $20,049 

64 $23,949 $30,000 $20,799 

65 $24,549 $31,500 $21,549 

66 $25,750 $33,000 $22,149 

67 $27,500 $34,500 $22,899 

68 $29,250 $35,750 $23,499 

69 $31,000 $37,250 $24,249 

70 $32,750 $38,749 $24,849 

71 $34,500 $40,249 $26,750 

72 $36,250 $41,749 $28,750 

73 $37,999 $43,249 $30,750 

74 $39,749 $44,499 $32,750 

75 $41,499 $45,999 $34,750 

76 $43,249 $47,499 $36,750 

77 $44,999 $48,999 $38,749 

78 $46,749 $51,000 $40,749 

79 $48,499 $55,000 $42,749 

80 $51,000 $59,000 $44,749 

81 $55,500 $63,500 $46,749 

82 $60,500 $67,500 $48,749 

83 $65,000 $71,500 $52,500 

84 $70,000 $75,499 $58,000 

85 $75,000 $79,499 $64,000 

86 $79,499 $83,499 $69,500 

87 $84,499 $87,499 $75,000 

88 $89,499 $91,499 $80,999 

89 $93,999 $95,499 $86,499 

90 $98,999 $99,499 $91,999 

91 $116,500 $118,000 $97,499 

92 $139,000 $139,000 $115,000 

93 $161,500 $158,500 $140,500 

94 $182,499 $179,499 $164,500 

95 $204,999 $198,999 $189,999 

96 $227,499 $219,999 $215,499 

97 $250,000 $239,499 $240,999 

98 $367,500 $320,000 $337,500 

99 $489,999 $459,999 $477,499 

100 $10,000,000 $10,000,000 $10,000,000 

Note: NAICS 321: Wood product manufacturing; 337: Furniture and related product manufacturing; 

339: Miscellaneous manufacturing. 

5216 

5217 5.2.4 Small Business Impact Summary for Wood Veneer Laminated Product Producers 

5218 

5219 Table 5-7 presents a summary of the number of affected small laminated product producers by 

5220 NAICS code, category of costs incurred, and employment status. Table 5-8 and Table 5-9 present the 

5221 small business impacts on employer and nonemployer wood veneer laminated product producers, 

5222 respectively. Table 5-10 summarizes the impacts to all small laminated product producers. 

5223 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 5-14 

5224 The number of firms by cost-revenue ratio bracket is estimated from the estimated number of 

firms, the per-firm costs, and the revenue distributions presented above in Table 5-5 and Table 5-6.60 5225 For 

5226 example, there are an estimated 165 employer wood veneer laminated product producers in the Wood 

5227 Kitchen Cabinet and Countertop industry (NAICS 337110) that will incur rule familiarization, labeling, 

5228 and raw materials costs ($2,260.62). Thus, employer firms with revenues below $75,354 ($2,260.62 

5229 divided by 3%) have cost-impact ratios above three percent and firms with revenue above $226,062 

5230 ($2,260.62 divided by 1%) have cost-impact ratios below one percent. Finally, firms with revenues 

between $75,354 and $226,062 would have cost-impact ratios between 1 and 3 percent. Since the 12th 5231 

5232 percentile of revenues for NAICS 337110 is below $75,354, 12 percent of these firms (20 firms) have 

cost-impact ratios above three percent. Since the 32nd 5233 percentile of revenues for NAICS 337110 is below 

5234 $226,062, 20 percent (32 minus 12 percent) or 33 of these firms have cost-impact ratios between one and 

5235 three percent. The remaining 68 percent of these firms (112 firms) have a cost-impact ratio below one 

5236 percent. 

5237 

5238 Overall, 5,532 small wood veneer laminated product producers (about 74 percent of the total) are 

5239 expected to have costs impacts that are less than one percent of their revenues, 759 firms (about 11 

5240 percent) are expected to experience impacts at levels between one and three percent of their revenue, and 

5241 1,159 firms (about 15 percent) are expected to incur costs exceeding three percent of their revenues. 

5242 

 60 Nonemployers were assumed to account for 30 percent of all affected wood veneer laminated product manufacturers. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 5-15 

Table 5-7: Number of Wood Veneer Laminated Product Producers with Cost Impacts, by NAICS

Categories of Costs 

Incurred 

NAICS 

321211 

NAICS 

321911 

NAICS 

321999 

NAICS 

337110 

NAICS 

337121 

NAICS 

337122

NAICS 

337127

NAICS 

337129

NAICS 

337211

NAICS 

337212

NAICS 

337215

NAICS 

339920

NAICS 

339932

NAICS 

339992 

All Small Employer Firms With Cost Impacts

Rule fam., label. 51 821 88 267 338 704 259 55 152 100 459 17 5 5

Rule fam., label., raw 

mat. 10 508 - 165 209 435 - 33 - - - - - -

Rule fam., label., raw 

mat., fab. record. 6 134 9 44 55 115 26 9 15 10 46 1 1 1

Rule fam., label., raw 

mat., fab. record., test., 

cert., HWPW record. 

1 30 2 10 13 26 6 2 4 2 11 1 - -

Total 68 1,493 99 485 615 1,280 291 99 171 112 516 19 6 6

All Nonemployer Firms With Cost Impacts

Rule fam., label. - 352 37 114 145 302 111 23 65 43 197 7 3 3 

Rule fam., label., raw 

mat. - 218 - 71 90 187 - 14 - - - - - - 

Rule fam., label., raw 

mat., fab. record. - 58 4 19 24 49 11 4 7 4 20 1 - - 

Rule fam., label., raw 

mat., fab. record., test., 

cert., HWPW record. 

- 13 1 4 5 11 2 1 1 1 4 - - - 

Total - 640 42 208 264 549 125 42 73 48 221 8 3 3 

All Small Firms With Cost Impacts

Rule fam., label. 51 1,173 125 381 483 1,006 370 78 217 142 656 24 8 8

Rule fam., label., raw 

mat. 10 725 - 236 299 622 - 47 - - - - - -

Rule fam., label., raw 

mat., fab. record. 6 192 13 62 79 164 38 13 22 15 66 2 1 1

Rule fam., label., raw 

mat., fab. record., test., 

cert., HWPW record. 

1 43 3 14 18 37 8 3 5 3 15 1 - -

Total 68 2,133 141 693 879 1,829 416 141 244 160 737 27 9 9

 Note: NAICS 321211: Hardwood Veneer and Plywood Manufacturers; 337110: Wood kitchen cabinet and countertop manufacturing; 337129: Wood 

television, radio, and sewing machine cabinet manufacturing; 337121: Upholstered household furniture manufacturing; 337122: Nonupholstered wood 

household furniture manufacturing; 337211: Wood office furniture manufacturing; 337127: Institutional furniture manufacturing; 337215: Showcase, 

partition, shelving, and locker manufacturing; 321911: Wood window and door manufacturing; 337212: Custom architectural woodwork and millwork 

manufacturing; 321999: All other miscellaneous wood product manufacturing; 339920: Sporting and athletic goods manufacturing; 339932: Game, 

toy, and children's vehicle manufacturing; 339992: Musical instrument manufacturing. 

5243 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 5-16 

Table 5-8: Small Business Impacts on Employer Wood Veneer Laminated Product Producers by 

NAICS 

Categories of Costs 

Incurred 

NAICS 

321211 

NAICS 

321911 

NAICS 

321999 

NAICS 

337110 

NAICS 

337121 

NAICS 

337122

NAICS 

337127

NAICS 

337129

NAICS 

337211

NAICS 

337212

NAICS 

337215

NAICS 

339920

NAICS 

339932

NAICS 

339992 

All Small Employer Firms With Cost Impacts <1%

Rule fam., label. 51 821 87 264 338 697 259 54 152 100 459 17 5 5

Rule fam., label., raw 

mat. 4 462 - 112 188 361 - 20 - - - - - -

Rule fam., label., raw 

mat., fab. record. 2 121 6 30 49 94 24 5 14 8 45 1 - -

Rule fam., label., raw 

mat., fab. record., test., 

cert., HWPW record. 

-6 - - 2 2 1 -1 - 4 - - -

Total 57 1,410 93 406 577 1,154 284 80 166 108 508 18 6 6

All Small Employer Firms With Cost Impacts >1% and <3%

Rule fam., label. -- 1 3 - 7 - 1-- - - - -

Rule fam., label., raw 

mat. 2 41 - 33 19 65 - 7 - - - - - -

Rule fam., label., raw 

mat., fab. record. 2 12 1 8 6 18 2 2 1 1 1 - - -

Rule fam., label., raw 

mat., fab. record., test., 

cert., HWPW record. 

-5 - 1 2 2 1 -1 - 3 - - -

Total 4 58 2 45 26 93 3 10 2 1 4 - - -

All Small Employer Firms With Cost Impacts >3%

Rule fam., label. -- - - - - - --- - - - -

Rule fam., label., raw 

mat. 4 5 - 20 2 9 - 6 - - - - - -

Rule fam., label., raw 

mat., fab. record. 31 2 6 1 2 1 2 -1 - - - -

Rule fam., label., raw 

mat., fab. record., test., 

cert., HWPW record. 

1 19 2 9 9 22 3 2 2 1 4 1 - -

Total 7 25 3 34 12 33 4 9 3 2 4 1 - -

 Note: NAICS 321211: Hardwood Veneer and Plywood Manufacturers; 337110: Wood kitchen cabinet and countertop manufacturing; 337129: Wood 

television, radio, and sewing machine cabinet manufacturing; 337121: Upholstered household furniture manufacturing; 337122: Nonupholstered wood 

household furniture manufacturing; 337211: Wood office furniture manufacturing; 337127: Institutional furniture manufacturing; 337215: Showcase, 

partition, shelving, and locker manufacturing; 321911: Wood window and door manufacturing; 337212: Custom architectural woodwork and millwork 

manufacturing; 321999: All other miscellaneous wood product manufacturing; 339920: Sporting and athletic goods manufacturing; 339932: Game, 

toy, and children's vehicle manufacturing; 339992: Musical instrument manufacturing. 

5244 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 5-17 

Table 5-9: Small Business Impacts on Nonemployer Wood Veneer Laminated Product Producers by 

NAICS 

Categories of Costs 

Incurred 

NAICS 

321211 

NAICS 

321911 

NAICS 

321999 

NAICS 

337110 

NAICS 

337121 

NAICS 

337122

NAICS 

337127

NAICS 

337129

NAICS 

337211

NAICS 

337212

NAICS 

337215

NAICS 

339920

NAICS 

339932

NAICS 

339992 

All Small Nonemployer Firms With Cost Impacts <1% 

Rule fam., label. - 130 14 48 61 127 47 10 27 18 83 2 1 1

Rule fam., label., raw 

mat. - 22 - 3 14 30 - 1 - - - - - -

Rule fam., label., raw 

mat., fab. record. -6 - 1 4 7 1 -1 - 2 - - -

Rule fam., label., raw 

mat., fab. record., test., 

cert., HWPW record. 

-- - - - - - --- - - - -

Total - 158 14 52 79 164 48 10 28 18 84 2 1 1

All Small Nonemployer Firms With Cost Impacts >1% and <3% 

Rule fam., label. - 95 10 32 41 85 31 7 18 12 55 2 1 1

Rule fam., label., raw 

mat. - 44 - 9 21 43 - 2 - - - - - -

Rule fam., label., raw 

mat., fab. record. - 11 - 2 5 11 2 - 1 - 4 - - -

Rule fam., label., raw 

mat., fab. record., test., 

cert., HWPW record. 

-- - - - - - --- - - - -

Total - 149 10 43 67 139 33 9 19 12 59 2 1 1

All Small Nonemployer Firms With Cost Impacts >3% 

Rule fam., label. - 127 13 34 44 91 33 7 19 13 59 3 1 1

Rule fam., label., raw 

mat. - 152 - 59 55 114 - 12 - - - - - -

Rule fam., label., raw 

mat., fab. record. - 41 3 16 15 31 8 3 5 4 14 1 - -

Rule fam., label., raw 

mat., fab. record., test., 

cert., HWPW record. 

- 13 1 4 5 11 2 1 1 1 4 - - -

Total - 333 18 113 118 246 44 23 26 18 78 4 1 1

 Note: NAICS 321211: Hardwood Veneer and Plywood Manufacturers; 337110: Wood kitchen cabinet and countertop manufacturing; 337129: Wood 

television, radio, and sewing machine cabinet manufacturing; 337121: Upholstered household furniture manufacturing; 337122: Nonupholstered wood 

household furniture manufacturing; 337211: Wood office furniture manufacturing; 337127: Institutional furniture manufacturing; 337215: Showcase, 

partition, shelving, and locker manufacturing; 321911: Wood window and door manufacturing; 337212: Custom architectural woodwork and millwork 

manufacturing; 321999: All other miscellaneous wood product manufacturing; 339920: Sporting and athletic goods manufacturing; 339932: Game, 

toy, and children's vehicle manufacturing; 339992: Musical instrument manufacturing. 

5245 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 5-18 

Table 5-10: Small Business Impacts on All Small Wood Veneer Laminated Product Producers by 

NAICS 

Categories of Costs 

Incurred 

NAICS 

321211 

NAICS 

321911 

NAICS 

321999 

NAICS 

337110 

NAICS 

337121 

NAICS 

337122

NAICS 

337127

NAICS 

337129

NAICS 

337211

NAICS 

337212

NAICS 

337215

NAICS 

339920

NAICS 

339932

NAICS 

339992 

All Small Firms With Cost Impacts <1% 

Rule fam., label. 51 951 101 312 399 824 306 64 179 118 542 19 6 6

Rule fam., label., raw 

mat. 4 484 - 115 203 391 - 21 - - - - - -

Rule fam., label., raw 

mat., fab. record. 2 127 6 30 53 102 25 5 14 8 47 1 - -

Rule fam., label., raw 

mat., fab. record., test., 

cert., HWPW record. 

-6 - - 2 2 1 -1 - 4 - - -

Total 57 1,568 107 458 656 1,318 332 90 194 126 592 20 7 7

All Small Firms With Cost Impacts >1% and <3% 

Rule fam., label. - 95 11 35 41 92 31 7 18 12 55 2 1 1

Rule fam., label., raw 

mat. 2 84 - 42 40 108 - 9 - - - - - -

Rule fam., label., raw 

mat., fab. record. 2 23 2 11 11 30 5 2 3 1 5 - - -

Rule fam., label., raw 

mat., fab. record., test., 

cert., HWPW record. 

-5 - 1 2 2 1 -1 - 3 - - -

Total 4 208 13 88 93 232 37 18 21 14 63 2 1 1

All Small Firms With Cost Impacts >3% 

Rule fam., label. - 127 13 34 44 91 33 7 19 13 59 3 1 1

Rule fam., label., raw 

mat. 4 157 - 79 57 123 - 18 - - - - - -

Rule fam., label., raw 

mat., fab. record. 3 42 5 21 15 33 9 5 5 5 14 1 - -

Rule fam., label., raw 

mat., fab. record., test., 

cert., HWPW record. 

1 31 2 13 15 33 6 3 4 2 9 1 - -

Total 7 358 21 147 130 279 48 32 28 20 82 4 2 2

 Note: NAICS 321211: Hardwood Veneer and Plywood Manufacturers; 337110: Wood kitchen cabinet and countertop manufacturing; 337129: Wood 

television, radio, and sewing machine cabinet manufacturing; 337121: Upholstered household furniture manufacturing; 337122: Nonupholstered wood 

household furniture manufacturing; 337211: Wood office furniture manufacturing; 337127: Institutional furniture manufacturing; 337215: Showcase, 

partition, shelving, and locker manufacturing; 321911: Wood window and door manufacturing; 337212: Custom architectural woodwork and millwork 

manufacturing; 321999: All other miscellaneous wood product manufacturing; 339920: Sporting and athletic goods manufacturing; 339932: Game, 

toy, and children's vehicle manufacturing; 339992: Musical instrument manufacturing. 

5246 

5247 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 5-19 

5248 5.3 Small Business Impacts for Fabricators, Wholesalers, and Retailers 

5249 

5250 The basic steps in the small business impact analysis for fabricators (excluding those fabricators 

5251 that are laminators, which are discussed in Section 5.2), wholesalers, and retailers are as follows: (1) 

5252 estimate the number of small firms, (2) estimate the revenue distribution of affected firms, (3) estimate 

5253 the cost per firm, and (4) based on the number of affected firms, the per-firm costs, and the revenue 

5254 distribution, estimate the number of firms by cost-revenue ratio. These steps are described in more detail 

5255 below. 

5256 

5257 5.3.1 Number of Small Fabricator, Wholesale, and Retail Firms 

5258 

5259 The number of small employer firms in the affected fabricator, wholesaler, and retailer NAICS 

5260 (described in Chapter 2) were estimated using data from the 2007 Economic Census, the Census Bureau’s 

5261 2008 Nonemployer Statistics, and SBA’s small business size standards. For those retail NAICS where 

5262 the Census revenue brackets overlapped the small business revenue threshold, the firms in the overlapped 

5263 bracket were counted as small. All nonemployer firms were assumed to be small. 

5264 

5265 5.3.2 Revenue Distribution for Affected Fabricator, Wholesale, and Retail Firms 

5266 

5267 The 2007 Economic Census has information on the number of employer firms by NAICS code in 

5268 18 revenue brackets. The 2008 Nonemployer Statistics has information on the number of nonemployer 

5269 firms by NAICS code in 12 revenue brackets. Impacts were separately estimated for six industry 

5270 categories: (1) employer fabricators, (2) employer wholesalers, (3) employer retailers, (4) nonemployer 

5271 fabricators, (5) nonemployer wholesalers, and (6) nonemployer retailers. For each industry category, the 

5272 number of affected firms by revenue bracket was estimated by combining the number of affected firms by 

5273 NAICS/employer status and the percentage of firms by revenue bracket within each affected 

5274 NAICS/employer status category. After compiling these data, the overall revenue distributions for each 

5275 percentile from 1 to 100 were calculated by assuming that revenues are uniformly distributed within each 

5276 revenue bracket. The bottom revenue bracket was assigned a revenue floor of $20,000 for employers and 

5277 $1,000 for nonemployers. Note that this analysis likely overestimates the number of affected firms in this 

5278 bottom revenue bracket because Census data includes firms with no revenue, and firms with no revenue 

5279 do not sell composite wood products and therefore are unlikely to incur costs due to the rule. The 

5280 resulting distributions are presented in Table 5-11. 

5281 

5282 

Table 5-11: Estimated Revenue Distribution for Fabricators, Wholesalers, and Retailers

Percentile 

Type of Firm 

Employers Nonemployers 

Fabricators Wholesalers Retailers Fabricators Wholesalers Retailers 

1 $25,110 $31,072 $25,110 $1,165 $1,206 $1,123 

2 $30,220 $41,292 $31,072 $1,329 $1,370 $1,247 

3 $34,478 $52,363 $36,182 $1,453 $1,576 $1,370 

4 $39,588 $63,435 $42,143 $1,617 $1,782 $1,494 

5 $44,698 $73,655 $47,253 $1,782 $1,946 $1,617 

6 $49,808 $84,726 $53,215 $1,946 $2,152 $1,741 

7 $54,918 $95,798 $58,325 $2,070 $2,358 $1,864 

8 $59,176 $105,167 $64,286 $2,234 $2,522 $1,987 

9 $64,286 $126,201 $69,396 $2,399 $2,728 $2,111 

10 $69,396 $143,027 $75,358 $2,563 $2,934 $2,234 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 5-20 

Table 5-11: Estimated Revenue Distribution for Fabricators, Wholesalers, and Retailers

Percentile 

Type of Firm 

Employers Nonemployers 

Fabricators Wholesalers Retailers Fabricators Wholesalers Retailers 

11 $74,506 $159,854 $80,468 $2,687 $3,098 $2,358 

12 $79,616 $180,888 $86,430 $2,851 $3,304 $2,481 

13 $84,726 $197,714 $91,540 $3,016 $3,510 $2,605 

14 $88,985 $214,541 $96,650 $3,181 $3,715 $2,728 

15 $94,095 $231,368 $102,611 $3,304 $3,880 $2,851 

16 $99,205 $252,401 $109,374 $3,469 $4,086 $2,975 

17 $104,315 $269,228 $121,994 $3,633 $4,291 $3,098 

18 $113,581 $286,055 $134,614 $3,798 $4,456 $3,222 

19 $126,201 $302,881 $143,027 $3,921 $4,662 $3,345 

20 $138,821 $323,915 $155,647 $4,086 $4,867 $3,469 

21 $151,441 $340,741 $164,061 $4,250 $5,032 $3,592 

22 $164,061 $357,568 $176,681 $4,415 $5,371 $3,715 

23 $176,681 $378,602 $189,301 $4,538 $5,729 $3,798 

24 $189,301 $395,428 $197,714 $4,703 $6,138 $3,921 

25 $201,921 $412,255 $210,334 $4,867 $6,496 $4,045 

26 $210,334 $429,082 $218,748 $5,032 $6,854 $4,168 

27 $222,954 $450,115 $231,368 $5,218 $7,263 $4,291 

28 $235,574 $466,942 $243,988 $5,524 $7,621 $4,415 

29 $248,194 $483,769 $252,401 $5,831 $8,031 $4,538 

30 $260,815 $504,802 $265,021 $6,138 $8,389 $4,662 

31 $273,435 $521,629 $277,641 $6,496 $8,747 $4,785 

32 $286,055 $552,128 $286,055 $6,803 $9,156 $4,909 

33 $298,675 $588,937 $298,675 $7,110 $9,514 $5,032 

34 $307,088 $625,745 $307,088 $7,417 $9,923 $5,218 

35 $319,708 $662,554 $319,708 $7,724 $10,384 $5,524 

36 $332,328 $694,104 $332,328 $8,031 $11,151 $5,831 

37 $344,948 $730,912 $340,741 $8,337 $11,919 $6,138 

38 $357,568 $767,721 $353,362 $8,644 $12,686 $6,445 

39 $370,188 $804,529 $361,775 $8,951 $13,453 $6,752 

40 $382,808 $841,338 $374,395 $9,309 $14,220 $7,059 

41 $395,428 $878,146 $387,015 $9,616 $15,141 $7,366 

42 $408,048 $914,955 $395,428 $9,923 $15,908 $7,673 

43 $416,462 $951,763 $408,048 $10,231 $16,676 $7,928 

44 $429,082 $983,313 $416,462 $10,844 $17,443 $8,235 

45 $441,702 $1,020,122 $429,082 $11,612 $18,210 $8,542 

46 $454,322 $1,067,448 $441,702 $12,226 $18,977 $8,849 

47 $466,942 $1,146,324 $450,115 $12,993 $19,745 $9,156 

48 $479,562 $1,225,199 $462,735 $13,607 $20,512 $9,463 

49 $492,182 $1,304,074 $471,149 $14,220 $21,433 $9,769 

50 $504,802 $1,382,950 $483,769 $14,988 $22,200 $10,076 

51 $517,422 $1,461,825 $496,389 $15,601 $22,967 $10,538 

52 $531,095 $1,540,701 $504,802 $16,369 $23,734 $11,305 

53 $567,903 $1,619,576 $517,422 $16,983 $24,502 $12,072 

54 $604,712 $1,698,452 $531,095 $17,750 $25,269 $12,839 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 5-21 

Table 5-11: Estimated Revenue Distribution for Fabricators, Wholesalers, and Retailers

Percentile 

Type of Firm 

Employers Nonemployers 

Fabricators Wholesalers Retailers Fabricators Wholesalers Retailers 

55 $636,262 $1,793,102 $562,645 $18,364 $26,856 $13,607 

56 $673,070 $1,871,978 $594,195 $18,977 $28,646 $14,374 

57 $709,879 $1,950,853 $620,487 $19,745 $30,436 $15,141 

58 $746,687 $2,029,728 $652,037 $20,358 $32,226 $15,908 

59 $783,496 $2,108,604 $683,587 $21,126 $34,017 $16,522 

60 $815,046 $2,187,479 $709,879 $21,739 $35,807 $17,289 

61 $851,855 $2,266,355 $741,429 $22,507 $37,853 $18,057 

62 $888,663 $2,345,230 $772,979 $23,121 $39,643 $18,824 

63 $925,472 $2,424,106 $799,271 $23,888 $41,434 $19,591 

64 $962,280 $2,502,981 $830,821 $24,502 $43,224 $20,358 

65 $993,830 $2,581,856 $862,371 $25,115 $45,014 $21,126 

66 $1,030,639 $2,734,350 $888,663 $26,344 $46,805 $21,893 

67 $1,098,998 $2,944,685 $920,213 $28,134 $48,851 $22,660 

68 $1,193,649 $3,128,727 $951,763 $29,925 $50,641 $23,427 

69 $1,288,299 $3,339,062 $983,313 $31,459 $53,711 $24,195 

70 $1,382,950 $3,549,396 $1,009,605 $33,249 $57,803 $24,962 

71 $1,493,375 $3,759,731 $1,041,155 $35,040 $61,895 $25,832 

72 $1,588,026 $3,970,065 $1,114,773 $36,830 $65,988 $28,134 

73 $1,682,677 $4,180,400 $1,193,649 $38,620 $70,080 $30,436 

74 $1,793,102 $4,390,734 $1,288,299 $40,411 $74,172 $32,738 

75 $1,887,753 $4,601,069 $1,382,950 $42,201 $77,753 $35,040 

76 $1,982,403 $4,811,403 $1,461,825 $43,991 $81,845 $37,597 

77 $2,077,054 $5,021,738 $1,556,476 $45,526 $85,937 $39,899 

78 $2,187,479 $5,232,073 $1,651,126 $47,316 $90,029 $42,201 

79 $2,282,130 $5,652,743 $1,730,002 $49,106 $94,122 $44,503 

80 $2,376,780 $6,073,412 $1,824,652 $50,897 $98,214 $46,805 

81 $2,487,206 $6,520,373 $1,919,303 $55,246 $102,307 $49,106 

82 $2,581,856 $6,941,042 $1,998,178 $60,361 $114,584 $52,177 

83 $2,813,225 $7,388,003 $2,092,829 $64,965 $128,395 $58,315 

84 $3,155,019 $7,808,672 $2,187,479 $70,080 $140,672 $63,942 

85 $3,523,104 $8,544,844 $2,266,355 $75,195 $154,483 $70,080 

86 $3,864,898 $9,333,598 $2,361,005 $79,799 $168,294 $76,218 

87 $4,232,984 $10,122,353 $2,455,656 $84,914 $180,571 $82,356 

88 $4,574,777 $11,200,318 $2,534,531 $89,518 $194,383 $88,495 

89 $4,916,571 $12,514,909 $2,629,183 $94,633 $208,194 $94,633 

90 $5,310,949 $13,829,500 $2,944,685 $99,237 $220,471 $100,771 

91 $6,178,579 $15,144,091 $3,260,186 $111,515 $234,282 $117,653 

92 $7,046,209 $17,089,687 $3,601,980 $134,533 $246,559 $140,672 

93 $7,913,840 $19,561,119 $3,917,482 $157,552 $276,229 $163,691 

94 $9,570,224 $22,505,804 $4,232,984 $180,571 $332,497 $186,710 

95 $11,778,738 $26,134,075 $4,548,485 $202,056 $386,208 $209,729 

96 $14,723,422 $31,392,440 $4,863,987 $225,074 $442,477 $232,747 

97 $19,087,866 $38,543,818 $5,179,489 $248,093 $498,745 $255,767 

98 $26,659,913 $49,638,969 $5,847,302 $350,401 $670,110 $365,747 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 5-22 

Table 5-11: Estimated Revenue Distribution for Fabricators, Wholesalers, and Retailers

Percentile 

Type of Firm 

Employers Nonemployers 

Fabricators Wholesalers Retailers Fabricators Wholesalers Retailers 

99 $43,591,849 $74,037,784 $6,604,507 $485,957 $879,839 $478,284 

100 $105,167,308 $105,167,307 $7,361,712 $2,557,673 $5,115,346 $10,230,695 

5283 

5284 5.3.3 Costs per Small Fabricator, Wholesale, and Retail Firm 

5285 

5286 The costs per small firm are estimated by annualizing the costs per firm presented in Chapter 2. 

5287 Except for recurring recordkeeping costs, the impact analysis uses a single average annualized cost per 

5288 firm for each cost element (rule familiarization, labeling and initial recordkeeping). 

5289 

Table 5-12: Per Firm Costs 

Description of Costs Incurred Initial or 

Annual Cost 

Annualized Cost 

(3 Percent) 

Fabricators 

Rule Familiarization $294.40 $14.29 

Initial Labeling (firms with minor costs) $132.81 $6.45 

Initial Labeling (firms with more substantial costs) $4,552.00 $220.97 

Recurring Recordkeeping 49.68 $47.27 

Wholesalers 

Rule Familiarization $373.16 $18.11 

Initial Recordkeeping $2,510.80 $121.88 

Initial Labeling (firms with more substantial costs) $4,552.00 $220.97 

Recurring Recordkeeping 51.08 $48.60 

Retailers 

Rule Familiarization $282.84 $13.73 

5290 

5291 

5292 Recurring recordkeeping costs are assumed to be a function of revenue rather than a fixed cost 

5293 per firm. As described in Chapter 2, the recordkeeping and labeling costs were estimated based on the 

5294 responses to a questionnaire administered to seven wholesale firms and another questionnaire 

5295 administered to nine fabricator firms. Based on revenue data from the Dun and Bradstreet database and 

5296 other publically available sources, the two respondents reporting recurring recordkeeping costs appeared 

5297 to be larger firms that likely have revenues that are significantly larger than the average revenue for 

5298 affected firms. Nevertheless, the costs they reported were still assumed to represent the average costs 

5299 for the fraction of affected firms that will incur additional recordkeeping costs due to the rule. These 

5300 average costs were compared to average industry revenues to calculate the cost impact of recurring 

5301 recordkeeping. (This is equivalent to scaling the recurring recordkeeping costs to the revenues of the 

5302 firm.) The cost impacts of recurring recordkeeping were then added to the cost impacts from the other 

5303 cost elements to calculate the total cost impact. 

5304 

5305 As described in Chapter 2, 11 percent of the fabricators that are not currently complying with the 

5306 CARB ATCM (because their products are not sold in California) are assumed to incur recurring 

5307 recordkeeping costs that were estimated to average $12,917 and $179 per year for employer firms and 

5308 nonemployer firms, respectively. This is $12,290 and $170 per year when annualized over 30 years using 

5309 a three percent discount rate. The analysis assumes that these recordkeeping costs include a fixed cost 

5310 component associated with 2 hours of labor ($47.27 annualized, based on labor rates at fabricator firms) 

5311 and a variable cost component that is estimated as a function of revenue. The variable cost component is 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 5-23 

5312 estimated to be 0.3 percent of revenue, which is calculated by taking the employer firm variable cost of 

5313 $12,243and dividing by the average employer firm revenue of $4.2 million (Given the revenue 

5314 distribution for fabricators shown in Table 5-11, this is equivalent to a range of recurring recordkeeping 

5315 costs of $120 to $304,002 per year for employer firm fabricators, and a range of $51 to $7,439 per year 

5316 for non-employer firm fabricators.) As shown in Table 5-12, the average annualized cost per firm to 

5317 fabricators for the other rule’s other requirements ranges from $14 to $220. The cost impacts from these 

5318 costs are combined with the cost impacts from recurring recordkeeping to calculate total cost impacts. 

5319 

5320 For wholesalers, 43 percent of the firms that are not currently complying with the CARB ATCM 

5321 (because their products are not sold in California) are assumed to incur recurring recordkeeping costs that 

5322 were estimated to average $4,980 and $100 per year for employer and nonemployer firms, respectively. 

5323 This is $4,739 and $95 per year when annualized over 30 years using a three percent discount rate. The 

5324 analysis assumes that these recordkeeping costs include a fixed cost component associated with 2 hours of 

5325 labor ($48.60 annualized, based on labor rates at wholesaler firms) and a variable cost component that is 

5326 estimated as a function of revenue. The variable cost component is estimated to be 0.06 percent of 

5327 revenue, which is calculated by taking the employer variable cost of $4,690 and dividing by the average 

5328 employer firm revenue of $8.3 million. (Given the revenue distribution for wholesalers shown in Table 

5329 5-11, this is equivalent to a range of recurring recordkeeping costs of $65 to $59,410 per year for 

5330 employer firm wholesalers, and a range of $48 to $2,935 per year for non-employer firm wholesalers.) 

5331 As shown in Table 5-12, the average annualized cost per firm to wholesalers for the other rule’s other 

5332 requirements ranges from $18 to $220 per year. The cost impacts from these costs are combined with the 

5333 cost impacts from recurring recordkeeping to calculate total cost impacts. 

5334 

5335 

5336 5.3.4 Small Business Impact Summary for Fabricators, Wholesalers, and Retailers 

5337 

5338 Table 5-13 presents the small business impacts on fabricators, wholesalers and retailers. Overall, 

5339 about 95 percent of small firms are expected to have cost impacts that are less than one percent of their 

5340 revenue, about 4 percent of small firms are expected to have cost impacts between one and three percent 

5341 of their revenue, and about 1 percent of small firms are expected to have cost impacts that exceed three 

5342 percent of their total revenue. The number of firms by cost-revenue ratio bracket is estimated from the 

5343 estimated number of firms, the per-firm costs shown in Table 5-12, and the revenue distributions 

5344 presented above in Table 5-11. 

5345 

5346 For example, 3,154 fabricator firms with employees are estimated to comply with the CARB 

5347 ATCM because their products may be sold in California. These firms incur the incremental cost of 

5348 $14.29 for rule familiarization with the TSCA Title VI rule, but do not incur incremental costs for the 

5349 rule’s other requirements. Thus, only firms with revenues below $476 ($14.29 divided by 3%) would 

5350 have cost-impact ratios above three percent and firms with revenue below $1,429 ($14.29 divided by 1%) 

5351 would have cost-impact ratios above one percent. Since the 1st percentile for employer fabricators is 

5352 greater than $1,429, it is estimated that all 3,154 of these employer fabricators have cost-impact ratios 

5353 below one percent. It is also estimated that 5,032 fabricators that are nonemployer firms comply with the 

5354 CARB ATCM because their products may be sold in California. Like the compliant firms with 

5355 employees, these nonemployer firms only incur the incremental cost of $14.29 for rule familiarization. 

However, since the 1st percentile for nonemployer fabricators is greater than $476 and the 3rd 5356 percentile 

5357 for revenue is greater than $1,429, it is estimated that 2 percent, or 101 of these firms have cost-impact 

5358 ratios of between one and three percent, while the remaining 4,931 firms have cost-impact ratios of less 

5359 than one percent. 

5360 

5361 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 5-24 

Table 5-13: Small Business Impacts on Fabricators, Wholesalers, and Retailers

Description of Costs Incurred Number of 

Small Firms

Average Cost 

Per Firm for 

Small Firmsa

(annualized, 3 

percent) 

Number of Firms with Impacts 

<1% 1-3% >3% 

Fabricator Employers 

Rule Fam. 3,154 $14.29 3,154 - - 

Rule Fam. and Labeling (minor cost) 21,570 $20.74 21,570

Rule Fam. and Labeling (major cost) 1,460 $235.26 1,460 - - 

Rule Fam., Labeling (major cost) and Rec.Rec.a 1,694 $282.53 1,626 68 - 

Total 27,879 

Fabricator Nonemployers 

Rule Fam. 5,032 $14.29 4,931 101 - 

Rule Fam. and Labeling (minor cost) 34,413 $20.74 32,004 2,409 - 

Rule Fam. and Labeling (major cost) 2,329 $235.26 885 629 815 

Rule Fam., Labeling (major cost) and Rec.Rec.a 2,703 $282.53 730 811 1,162 

Total 44,478 

Wholesale Employers

Rule Fam. 30,884 $18.11 30,884 - - 

Rule Fam., Initial Rec. 845 $140.00 845 - - 

Rule Fam., Initial Rec., Rec.Rec.a 2,252 $188.60 2,252 - - 

Rule Fam., Initial Rec., Rec.Rec.a, Initial Labeling 343 $409.56 329 14 - 

Total 34,325 

Wholesale Nonemployers 

Rule Fam. 45,539 $18.11 43,717 1,822 - 

Rule Fam., Initial Rec. 1,247 $140.00 761 249 237 

Rule Fam., Initial Rec., Rec.Rec.a 3,321 $188.60 1,760 764 797 

Rule Fam., Initial Rec., Rec.Rec.a, Initial Labeling 506 $409.56 182 127 197 

Total 50,613 

Retail Employers

Rule Fam. 202,630 $13.73 202,630 - - 

Total 202,630 

Retail Nonemployers 

Rule Fam. 511,359 $13.73 496,018 15,341 - 

Total 511,359 

All Fabricators, Wholesale and Retail Firms 

All Costs 871,283 - 845,738 

 

22,335 

 

3,208 a The analysis estimates impacts due to rule familiarization, notification, labeling, and initial recordkeeping using an average cost 

that is treated as a fixed cost per firm, although in reality costs will vary by firm. By contrast, recurring recordkeeping (or “Rec. 

Rec.”) costs are estimated as a fixed cost plus a variable cost that is a function of revenue, since these costs are expected to be larger 

for firms with larger sales volumes. These variable costs are estimated to be 0.3% of fabricator revenues and 0.06% of wholesale 

firm revenues. 

5362 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 5-25 

5363 5.4 Summary of Small Business Impacts 

5364 

5365 Table 5-14 presents a summary of the small business impacts from the proposed TSCA Title VI 

5366 Implementation Rule. As indicated, 851,296298 small firms (about 97 percent) are expected to have costs 

5367 impacts that are less than one percent of their revenues, 22,133131 firms (about 3 percent) are expected to 

5368 experience impacts at levels between one and three percent of their revenue, and 4,369 firms (less than 1 

5369 percent) are expected to incur costs exceeding three percent of their revenues. 

5370 

5371 Note that many of the firms with cost impacts above 1 percent of their revenues are fabricators, 

5372 wholesalers, and retailers with annualized costs less than $250 (as shown in Table 5-13). All fabricators 

5373 except those with recurring recordkeeping costs and all wholesalers except those with initial labeling 

5374 costs that had impacts above 1% of their revenues had annualized costs that were below $250. Note that 

5375 this implies that their revenues were below $25,000). These firms account for 92 percent of the firms 

5376 with cost impacts that are between 1 and 3 percent and 42 percent of the firms with cost impacts that 

5377 exceed 3 percent. 

5378 

Table 5-14: Summary of Small Business Impacts 

Employer Status Firm Type 

Number of 

Affected Small 

Firms 

Number of Firms by Cost-Impact 

Ratio

<1% 1-3% >3% 

Employers 

Stock Panel Producer 31 2527 53 1 

Wood Veneer Laminated Product 5,260 4,873 249 138 

Fabricator 27,879 27,810 68 - 

Wholesale 34,324 34,310 14 - 

Retail 202,630 202,630 - - 

All Firms 270,123 269,648650 336334 139 

Nonemployers 

Stock Panel Producer - - - - 

Wood Veneer Laminated Product 2,226 659 545 1,021 

Fabricator 44,478 38,550 3,949 1,977 

Wholesale 50,612 46,420 2,961 1,231 

Retail 511,359 496,018 15,341 - 

All Firms 608,675 581,648 22,797 4,230 

All Firms 

Stock Panel Producer 31 2527 53 1 

Wood Veneer Laminated Product 7,486 5,532 795 1,159 

Fabricator 72,357 66,360 4,017 1,977 

Wholesale 84,936 80,730 2,975 1,231 

Retail 713,989 698,648 15,341 - 

All Firms 878,798 851,296298 23,133131 4,369 

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

May 1, 2013 6-1 

5379 6 Environmental Justice and Other Impacts 

5380 

5381 In addition to the cost analysis presented in Chapter 2, the small business analysis presented in 

5382 Chapter 5, several other types of impacts are important to consider in evaluating the effects of a 

5383 regulation. This chapter presents the incremental impact of the proposed TSCA Title VI Implementation 

5384 Rule on: 

5385 

5386  Environmental Justice, as required by Executive Order 12898–Environmental Justice; 

5387  Employment impact analysis 

5388  Paperwork burden, as required by the Paper Work Reduction Act; 

5389  State and Local Governments, as required by the Unfunded Mandates Reform Act; 

5390  Federalism, as required by Executive Order 13132–Federalism; 

5391  Tribal governments, as required by Executive Order 13175–Consultation and Coordination 

5392 with Indian Tribal Governments; 

5393  The environmental health risk or safety risk to children due to the regulation, as required by 

5394 Executive Order 13045–Protection of Children From Environmental Health & Safety Risks; 

5395 and 

5396  Whether voluntary consensus standards are used in its regulatory activities. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 6-2 

5397 6.1 Environmental Justice 

5398 

5399 This proposed rule establishes standards that reduce emissions of formaldehyde from 

5400 composite wood products. Formaldehyde exposure may cause a range of health effects including 

5401 nasopharyngeal cancer, sensory irritation, asthma, and female reproductive toxicity.and respiratory related 

5402 effects,. 

5403 

5404 The Economic Analysis for this rule monetizes the benefits from reducing eachcases of these 

5405 four identified health impacts,nasopharyngeal cancer and estimates total benefits as the sum of these four 

5406 categoriessensory irritation. Benefits valuation is done for formaldehyde exposure in five climate zones 

5407 from nine different housing types (five types of new housing and four types of renovated housing), 

5408 allowing for off-gassing of up to ten years, as well as occupational, school, and outside formaldehyde 

5409 exposure. The population in these climate zones and housing types is broken down into broad age and 

5410 employment categories to assess exposure. 

5411 

5412 Executive Order 12898 (59 FR 7629, February 16, 1994) establishes Federal executive policy 

5413 on Environmental Justice (EJ). Its main provision directs Federal agencies, to the greatest extent 

5414 practicable and permitted by law, to make EJ part of their mission by identifying and addressing, as 

5415 appropriate, disproportionately high and adverse human health or environmental effects of their programs, 

5416 policies, and activities on minority and low-income populations in the U.S. 

5417 

5418 This Environmental Justice analysis expands on the primary analysis by analyzing the 

5419 impacts specifically for minority and low-income populations. The methodology used in this analysis is a 

5420 disaggregation of impacts, i.e. number of cases avoided, by environmental justice groups, specifically 

5421 minority, tribal, and low-income populations. Disaggregation takes into account the differences in 

5422 housing types, climate zones, and age and employment categories, across environmental justice 

5423 populations. Data are the same as used in the total benefits analysis, presented earlier in this Economic 

5424 Analysis, and are taken from the American Community Survey (information on race and ethnicity, age, 

5425 family composition, and incomes: 2007 –to 2009), the American Housing Survey (information on 

5426 housing types, age, and renovations: 2009), and the exposure assessment for this rule. 

5427 

5428 The race and ethnicity categories in the American Communities Survey (ACS) are self5429 reported and not mutually exclusive. In order to avoid double-counting populations, all individuals who 

5430 identified as Hispanic separately were counted as such, regardless of any other reported racial category. 

5431 For non-vacant households in which no race or ethnicity data was reported, the ACS reports the previous 

5432 occupant’s racial category, which was used in this analysis. The ACS survey weights take into account 

5433 other sources of demographic information, in addition to race and ethnicity, making the sample nationally 

5434 representative. The ACS also contains detailed information on housing, including age and type of housing 

5435 (mobile home or trailer, single-family detached, single-family attached, apartment, and RVs). Population 

5436 and housing information were combined to estimate the number of cases avoided by environmental 

5437 justice population. As with the total benefits monetization, the number of cases avoided, by 

5438 environmental justice population, were then multiplied by monetization measures (e.g. willingness to pay, 

5439 or cost of illness) to obtain benefits estimates by environmental justice population. This approach 

5440 incorporates differences in housing types across minority and income groups. 

5441 

5442 Table 6-1 and Table 6-2 present the estimated number of adverse health cases avoided for each 

5443 year the regulation is in place. Table 6-1 presents the number of cases by health effect, option, and 

5444 minority group and Table 6-2 presents the number of cases by health effect, option, income group. Table 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 6-3 

5445 6-3 and Table 6-4 present the number of cases avoided by option aggregated across all health effects by 

5446 minority and income population, respectively. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 6-4 

Table 6-1: Number of Cases Avoided by Minority Population (Average Number of Cases Avoided 

Per Year of Regulation) 

Analytical Option 

Cancer Eye Irritation Asthma Fertility

Lower Higher Lower Higher Lower Higher

All Individuals 

Option SE/SEUR/SFCC 9 9 21 22,133 170,214

 

2,469 

 

3,416 

 

1,501 

Option 

SI/SC/SCR/SCUR 10 24 23,650 191,590 

 

2,799 

 

3,864 

 

1,696 

Option SN 11 25 24,154 198,950 

 

2,915 

 

4,019 

 

1,765 

Option CE 7 7 16 18,015 130,720 

 

1,899 

 

2,627 

 

1,144 

Option CI 8 8 19 19,563 148,389 

 

2,166 

 

2,988 

 

1,301 

Option NE 39 92 58,492 626,726 

 

9,554 

 

13,235 

 

6,566 

Option NI 40 97 58,494 645,678 

 

9,968 

 

13,800 

 

6,874 

Non-Hispanic White 

Option SE/SEUR/SFCC 5 5 12 12,511 101,464

 

1,301 

 

1,783 

 

876 

Option 

SI/SC/SCR/SCUR 6 6 14 13,375 114,319 

 

1,477 

 

2,017 

 

989 

Option SN 6 6 15 13,657 118,743 

 

1,538 

 

2,098 

 

1,028 

Option CE 4 4 9 9 10,219 78,039 

 

1,003 

 

1,373 

 

669 

Option CI 5 5 11 11,076 88,658 

 

1,145 

 

1,562 

 

759 

Option NE 22 53 35,781 376,411 

 

5,004 

 

6,876 

 

3,817 

Option NI 23 55 35,783 387,742 

 

5,222 

 

7,167 

 

3,993 

Non-Hispanic Black 

Option SE/SEUR/SFCC 1 1 3 3 3,144 23,118

 

399 

 

532 

 

212 

Option 

SI/SC/SCR/SCUR 1 1 3 3 3,367 26,011 

 

451 

 

601 

 

240 

Option SN 1 1 3 3 3,443 27,008 

 

469 

 

625 

 

249 

Option CE 1 1 2 2 2,542 17,703 

 

306 

 

408 

 

162 

Option CI 1 1 3 3 2,778 20,096 

 

348 

 

464 

 

184 

Option NE 5 5 13 6,738 83,156 

 

1,561 

 

2,079 

 

929 

Option NI 6 6 13 6,738 85,808 

 

1,629 

 

2,170 

 

974 

All Hispanic 

Option SE/SEUR/SFCC 2 2

 4 

4 4,805 31,388 551 

 

789 

 

276 

Option 

SI/SC/SCR/SCUR 2 2

 5 

5 5,116 35,314 626 

 

895 

 

314 

Option SN 2 2

 5 

5 5,222 36,666 652 

 

932 

 

327 

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May 1, 2013 6-5 

Option CE 1 1

 3 

3 3,902 24,102 423 

 

606 

 

210 

Option CI 2 2

 4 

4 4,234 27,352 484 

 

692 

 

240 

Option NE 8 8 19 12,361 115,160 

2,133 

 

3,053 

 

1,213 

Option NI 8 8 20 12,362 118,593 

2,227 

 

3,187 

 

1,272 

Non-Hispanic Native American or Alaskan Indian 

Option SE/SEUR/SFCC 0 0

 0 

0 108 942

 

17 

 

23 

 

10 

Option 

SI/SC/SCR/SCUR 0 0

 0 

0 117 1,075 

 

19 

 

26 

 

11 

Option SN 0 0

 0 

0 120 1,121 

 

20 

 

27 

 

12 

Option CE 0 0

 0 

0 87 727 

 

13 

 

17 

 

7 

Option CI 0 0

 0 

0 97 837 

 

15 

 

20 

 

9 

Option NE 0 0

 1 

1 267 3,334 

 

62 

 

84 

 

41 

Option NI 0 0

 1 

1 267 3,450 

 

65 

 

88 

 

43 

Non-Hispanic Other Race 

Option SE/SEUR/SFCC 1 1

 2 

2 1,566 13,301 201 

 

289 

 

127 

Option 

SI/SC/SCR/SCUR 1 1

 2 

2 1,675 14,870 226 

 

325 

 

143 

Option SN 1 1

 2 

2 1,712 15,412 235 

 

337 

 

149 

Option CE 1 1

 1 

1 1,265 10,149 154 

 

222 

 

97 

Option CI 1 1

 1 

1 1,377 11,446 175 

 

250 

 

109 

Option NE 3 3

 8 

8 3,345 48,665 793 

 

1,142 

 

566 

Option NI 3 3

 8 

8 3,345 50,085 825 

 

1,187 

 

592 

Option SCRSCUR is the proposed option. 

5447 

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

May 1, 2013 6-6 

Table 6-2: Number of Cases Avoided by Income Population (Average Number of Cases Avoided 

Per Year of Regulation) 

Analytical Option Cancer Eye Irritation Asthma Fertility

Lower Higher Lower Higher Lower Higher

Number of Cases Avoided in Typical Year 

All Individuals 

Option 

SE/SEUR/SFCC 9 21 22,133 170,214 

 

2,469 

 

3,416 

 

1,501 

Option 

SI/SC/SCR/SCUR 10 24 23,650 191,590 

 

2,799 

 

3,864 

 

1,696 

Option SN 11 25 24,154 198,950 

 

2,915 

 

4,019 

 

1,765 

Option CE 7 16 18,015 130,720 

 

1,899 

 

2,627 

 

1,144 

Option CI 8 19 19,563 148,389 

 

2,166 

 

2,988 

 

1,301 

Option NE 39 92 58,492 626,726 

 

9,554 

 

13,235 

 

6,566 

Option NI 40 97 58,494 645,678 

 

9,968 

 

13,800 

 

6,874 

Individuals Living Above Poverty Line 

Option 

SE/SEUR/SFCC 8 18 17,551 142,637 

 

1,997 

 

2,743 

 

1,223 

Option 

SI/SC/SCR/SCUR 9 20 18,682 160,241 

 

2,260 

 

3,095 

 

1,378 

Option SN 9 21 19,056 166,305 

 

2,352 

 

3,217 

 

1,433 

Option CE 6 14 14,341 109,557 

 

1,536 

 

2,108 

 

933 

Option CI 7 15 15,517 124,097 

 

1,748 

 

2,392 

 

1,057 

Option NE 33 77 48,806 530,167 

 

7,758 

 

10,677 

 

5,359 

Option NI 34 80 48,808 545,677 

 

8,086 

 

11,117 

 

5,601 

Individuals Living Below Poverty Line

Option 

SE/SEUR/SFCC 1 4 4,551 27,046 

 

442 

 

631 

 

278 

Option 

SI/SC/SCR/SCUR 2 4 4,935 30,750 

 

506 

 

721 

 

318 

Option SN 2 4 5,064 32,023 

 

528 

 

752 

 

332 

Option CE 1 3 3,647 20,756 

 

341 

 

486 

 

211 

Option CI 1 3 4,017 23,829 

 

392 

 

558 

 

243 

Option NE 6 15 9,641 94,701 

 

1,683 

 

2,397 

 

1,207 

Option NI 6 16 9,642 98,084 

 

1,766 

 

2,514 

 

1,274 

Option SCRSCUR is the proposed option. 

5448 

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

May 1, 2013 6-7 

Table 6-3: Summary of Number of Cases Avoided by Race and Ethnicity

Analytical Option 

Population 

Affected 

(thousands) 

Population 

Affected as 

Percent% of 

Total Affected 

Population 

Total Lower 

Estimates of 

Cases Avoided 

Total Higher 

Estimate of Cases 

Avoided 

Percentage of 

Total Cases 

Avoided 

Lower Estimate

Percentage of 

Total Cases 

Avoided 

Higher Estimate 

All Individuals 

Option SE/SEUR/SFCC

106,057 100.0% 

 

26,112 

22,142

 175,152 

170,236

100% 100% 

Option SI/SC/SCR/SCUR

 

28,156 

23,660

 197,175 

191,615

100% 100% 

Option SN 

28,844 

24,165

 204,759 

198,975

100% 100% 

Option CE 

21,066 

18,022

 134,508 

130,737

100% 100% 

Option CI 

23,037 

19,571

 152,696 

148,407

100% 100% 

Option NE 

74,650 

58,530

 646,619 

626,818

100% 100% 

Option NI 

75,378 

58,535

 666,449 

645,775

100% 100% 

Non-Hispanic White 

Option SE/SEUR/SFCC

69,169 65.2% 

 

14,693 

12,516

 104,135 

101,477

56.35% 59.56% 

Option SI/SC/SCR/SCUR

 

15,847 

13,381

 117,339 

114,333

56.36% 59.57% 

Option SN 

16,230 

13,664

 121,885 

118,758

56.35% 59.57% 

Option CE 

11,895 

10,223

 80,090 

78,048

56.57% 59.57% 

Option CI 

12,985

11,081

 90,989 

88,668

56.46% 59.67% 

Option NE 

44,625 

35,804

 387,157 

376,464

59.861.2% 59.960.1% 

Formatted Table

Formatted Table

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

May 1, 2013 6-8 

Option NI 

45,022 

35,806

 398,957 

387,797

59.761.2% 59.960.1% 

Non-Hispanic Black 

Option SE/SEUR/SFCC

12,540 11.8% 

3,756 145 23,865 121 14.42% 13.6% 

Option SI/SC/SCR/SCUR 

4,059 3,368 26,855 014 14.42% 13.6% 

Option SN 

4,163 3,444 27,885 011 14.43% 13.6% 

Option CE 

3,010 2,543

 18,275 

17,705

14.31% 13.65% 

Option CI 

3,310 2,779 20,746 099 14.42% 13.65% 

Option NE 

9,233 6,743

 86,177 

83,169

12.411.5% 13.3% 

Option NI 

9,347 6,744

 88,966 

85,822

12.411.5% 13.3% 

Non-Hispanic Other Race 

Option SE/SEUR/SFCC

7,381 7.0% 

 

1,896 4,806

 13,720 

31,393

21.7.3% 7.818.4% 

Option SI/SC/SCR/SCUR 

2,045 5,118

 15,340 

35,319

7.321.6% 7.818.4% 

Option SN 

2,096 5,224

 15,900 

36,671

7.321.6% 7.818.4% 

Option CE 

1,516 3,904

 10,468 

24,106

21.7.2% 7.818.4% 

Option CI 

1,662 4,236

 11,807 

27,356

7.221.6% 7.718.4% 

Option NE 

4,707 

12,368

 50,381 

115,178

6.321.1% 7.818.4% 

Option NI 

4,765 

12,370

 51,873 

118,612

6.321.1% 7.818.4% 

Non-Hispanic Native American or Alaskan Indian 

Option SE/SEUR/SFCC

652 0.6% 

 

134 108

 975 

943

0.5% 0.6% 

Option SI/SC/SCR/SCUR 

148 117

 1,112 

1,075

0.5% 0.6% 

Option SN 

152 120

 1,160 

1,121

0.5% 0.6% 

Option CE 

108 87

 752 

727

0.5% 0.6% 

Option CI 

120 97

 866 

837

0.5% 0.6% 

Formatted Table

Formatted Table

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

May 1, 2013 6-9 

Option NE 

369 267

 3,459 

3,335

0.5% 0.5% 

Option NI 

375 267

 3,582 

3,451

0.5% 0.5% 

All Hispanic

Option SE/SEUR/SFCC

16,318 15.4% 

 

5,633 1,567

 32,458 

13,303

21.67.1% 18.57.8% 

Option SI/SC/SCR/SCUR 

6,057 1,676

 36,528 

14,872

21.57.1% 18.57.8% 

Option SN 

6,203 1,712

 37,930 

15,414

21.57.1% 18.57.7% 

Option CE 

4,537 1,265

 24,922 

10,150

21.57.0% 18.57.8% 

Option CI 

4,960 1,378

 28,288 

11,447

21.57.0% 18.57.7% 

Option NE 

15,715 

3,348

 119,444 

48,672

21.15.7% 18.57.8% 

Option NI 

15,869 

3,348

 123,071 

50,093

21.15.7% 18.57.8% 

Option SCRSCUR is the proposed option. 

5449 

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

May 1, 2013 6-10 

Table 6-4: Summary of Number of Cases Avoided by Income

Analytical Option 

Population 

Affected 

(thousands) 

Population 

Affected as 

Percent of Total 

Affected 

Population 

Total Lower 

Estimates of Cases 

Avoided 

Total Higher 

Estimate of Cases 

Avoided 

Percentage of 

Total Cases 

Avoided 

Lower Estimate

Percentage of 

Total Cases 

Avoided 

Higher Estimate 

All Individuals 

Option SE/SEUR/SFCC

106,057 100.0% 

 

26,543 

22,142

 

175,572 

170,236

100% 100% 

Option SI/SC/SCR/SCUR

 

28,611 

23,660

 

197,670 

191,615

100% 100% 

Option SN 

29,307 

24,165

 

205,281 

198,975

100% 100% 

Option CE 

21,440 

18,022

 

134,798 

130,737

100% 100% 

Option CI 

23,438 

19,571

 

153,049 

148,407

100% 100% 

Option NE 

75,298 

58,530

 

648,430 

626,818

100% 100% 

Option NI 

76,026 

58,535

 

668,305 

645,775

100% 100% 

Individuals Living Below Poverty Line

Option SE/SEUR/SFCC

13,081 12.3% 

5,211 4,553 27,891 049 20.36% 16.015.9% 

Option SI/SC/SCR/SCUR 5,683 4,937 31,722 

30,754 20.59% 16.1% 

Option SN 5,843 066 33,038 

32,027 20.621.0% 16.21% 

Option CE 4,156 3,648 21,400 

20,759 20.02% 15.9% 

Option CI 4,599 018 24,574 

23,832 20.25% 16.1% 

Option NE 12,108 9,647 98,058 

94,716 16.85% 15.21% 

Option NI 12,229 9,648 101,607 

98,100 16.85% 15.32% 

Individuals Living Above Poverty Line

Option SE/SEUR/SFCC

92,631 87.3% 

20,45917,55

8

146,312142,

655 79.53% 83.78% 

Option SI/SC/SCR/SCUR 21,93918,69

0

164,406160,

261 79.30% 83.6% 

Option SN 22,43519,06

5

170,640166,

326 79.278.9% 83.56% 

Option CE 16,60914,34

7

112,349109,

571 79.86% 83.78% 

Option CI 18,07015,52

4

127,285124,

113 79.53% 83.56% 

Option NE 59,84648,83

9

545,209530,

244 83.04% 84.56% 

Formatted Table

Formatted Table

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

May 1, 2013 6-11 

Option NI 60,30748,84

3

561,338545,

758 83.04% 84.45% 

Option SCRSCUR is the proposed option. 

5450 

5451 Table 6-5 presents a summary of quantified benefits for minority populations. Quantified

5452 benefits estimates are presented, for each analytical option, in both totals for each environmental justice 

5453 population group and then as estimates for individuals within that group. As with the total benefits 

5454 analysis for this rule, a range of estimates is presented: from lower to higher. Estimates are reported in 

5455 2010 dollars, annualized at a 3% rate. 

5456 

5457 Results indicate that disaggregation of total benefits by population groups leads to variation in the 

5458 range of individual benefits, by minority population. The population of all individuals affected by the 

5459 rule shows the same estimates reported in the total benefits analysis; annualizedquantified benefits 

5460 ranging from $16218 to $28950 million per year for the options with emissions standards that are 

5461 consistent with the statute, and $1.530.17 to $2.730.47 per individual. The affected Non-Hispanic White 

5462 population accountedaccounts for 65 percent of the total affected population, accrued 54accrues about 60

5463 percent of the total annualizedquantified benefits, and experiencedexperiences average 

5464 annualizedquantified benefits ranging from $1.260.14 to $2.250.44 per individual. In comparison, 

5465 benefits for minority populations are higher. 

5466 

5467 Minority populations represent about 35 percent of the individuals affected by the rule and are 

5468 estimated to accrue about 4640 percent of the proposed rule’s totalquantified benefits. The affected Non5469 Hispanic Black population accountedaccount for 12 percent of the total affected population, accrued 15 to 

5470 16accrue about 13 percent of the total annualizedquantified benefits, and experiencedexperience average 

5471 annualizedquantified benefits ranging from $2.050.19 to $3.490.51 per individual. The affected Hispanic 

5472 population accountedaccounts for 15 percent of the total affected population, accrued 22accrues about 18

5473 percent of the total quantified benefits, and experiences average quantified benefits ranging from $0.20 to 

5474 $0.54 per individual. The affected Non-Hispanic Native American or Alaskan Indian population accounts

5475 for 0.6 percent of the total affected population, accrues 0.6 percent of the total annualized benefits, and 

5476 experienced average annualized benefits ranging from $2.17 to $3.94 per individual. The affected Non5477 Hispanic Native American or Alaskan Indian population accounted for 0.6 percent of the total affected 

5478 population, accrued 0.7 percent of the total annualized benefits, and experienced average annualized 

5479 benefits ranging from $1.66 to $2.93 per individual.0.17 to $0.46 per individual. 

5480 

5481 Following the Census methodology, low-income families are identified in this analysis as 

5482 having annual incomes below the poverty threshold. The poverty threshold, as determined by the U.S. 

5483 Census Bureau, varies by family size, age, and composition and is adjusted for inflation. Table 6-6 

5484 presents a summary of quantified benefits for low-income populations. As with the total benefits analysis 

5485 for this rule, a range of estimates is presented: from lower to higher. Estimates are reported in 2010 

5486 dollars, annualized at a 3% rate. 

5487 

5488 Results indicate that disaggregation of total benefits by population groups leads to variation in the 

5489 range of individual benefits, by income category. The population of all individuals affected by the rule 

5490 shows the same estimates reported in the total benefits analysis; annualizedquantified benefits ranging 

5491 from $16218 to $28950 million per year for the options with emissions standards that are consistent with 

5492 the statute, and $1.530.17 to $2.730.47 per individual. The affected low-income population 

5493 accountedaccounts for 12 percent of the total affected population, accrued 18 accrues about 14 percent of 

5494 the total annualizedquantified benefits, and experiencedexperiences average annualizedquantified benefits 

5495 ranging from $2.170.19 to $3.990.56 per individual. 

5496 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 6-12 

5497 Table 6-7 summarizes the number of cases avoided by affected minority and low-income 

5498 population groups, and Table 6-8 summarizes the quantified benefits. This Environmental Justice 

5499 analysis shows slightly larger individual benefits for affected minority and low-income population groups

5500 (see ).. Minority populations represent 35 percent of the individuals affected by the rule and are estimated 

5501 to accrue 4640 percent of the proposed rule’s totalquantified benefits. Individuals living below the 

5502 poverty line represent 12 percent of the individuals affected by the rule and are estimated to accrue 15 to 

5503 16about 14 percent of the proposed rule’s totalquantified benefits. Given these results, EPA has 

5504 determined that this proposed rule will not have disproportionally high and adverse human health or 

5505 environmental effects on any population, including any minority or low-income population. These 

5506 proposed standards would reduce emissions of formaldehyde from composite wood products for all 

5507 populations that are exposed, with slightly larger quantified benefits for individuals from minority or low5508 income affected populations. 

5509 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 6-13 

Table 6-5: Summary of Quantified Benefits by Race and Ethnicity (annualized at 3% rate)

Analytical Option 

Population 

Affected 

(thousands) 

Population 

Affected as Percent 

of Total Affected 

Population 

Total Benefits 

Lower Estimate 

(millions 2010$ or 

percent of total) 

Total Benefits 

Higher Estimate

(millions 2010$ or 

percent of total) 

Total Benefits per 

Affected Individual

Lower Estimate 

(in dollars) 

Total Benefits per 

Affected Individual 

Higher Estimate 

(in dollars) 

All Individuals 

Option SE/SEUR/SFCC

106,057 100.0% 

$16218 $24542 $1.530.17 $2.310.39

Option SI/SC/SCR/SCUR $18420 $27848 $1.740.19 $2.620.45

Option SN $19221 $28950 $1.810.20 $2.730.47

Option CE $12514 $18832 $1.180.13 $1.770.30

Option CI $14216 $21437 $1.340.15 $2.020.34

Option NE $63976 $970178 $6.020.72 $9.151.68

Option NI $66780 $1,013186 $6.290.75 $9.551.76

Non-Hispanic White 

Option SE/SEUR/SFCC

69,169 65.2% 

53.560.4% 53.761.3% $1.260.16 $1.900.37

Option SI/SC/SCR/SCUR 53.660.4% 53.861.4% $1.430.18 $2.160.42

Option SN 53.660.4% 53.861.4% $1.490.18 $2.250.44

Option CE 53.660.5% 53.861.4% $0.9712 $1.460.28

Option CI 53.760.5% 53.861.5% $1.110.14 $1.670.33

Option NE 53.360.2% 53.661.0% $4.930.66 $7.521.57

Option NI 53.360.2% 53.661.0% $5.140.69 $7.851.64

Non-Hispanic Black

Option SE/SEUR/SFCC

12,540539 11.8% 

15.913.3% 15.112.9% $2.050.19 $2.960.43

Option SI/SC/SCR/SCUR 15.813.3% 15.112.9% $2.320.21 $3.350.49

Option SN 15.813.3% 15.112.9% $2.420.22 $3.490.51

Option CE 15.813.3% 15.112.9% $1.570.14 $2.260.33

Option CI 15.813.3% 15.112.9% $1.790.16 $2.580.38

Option NE 16.013.3% 15.213.0% $8.140.81 $11.771.84

Option NI 16.013.3% 15.213.0% $8.490.85 $12.291.93

Non-Hispanic Other Race 

Option SE/SEUR/SFCC

7,381380 7.0% 

8.17.7% 8.37.5% $1.780.18 $2.760.43

Option SI/SC/SCR/SCUR 8.07.6% 8.37.5% $2.010.21 $3.110.48

Option SN 8.07.6% 8.27.4% $2.090.22 $3.230.50

Option CE 8.17.6% 8.37.5% $1.360.14 $2.110.32

Option CI 8.07.6% 8.27.4% $1.550.16 $2.390.37

Option NE 7.8.2% 8.57.7% $7.140.80 $11.121.85

Option NI 7.8.2% 8.47.6% $7.430.84 $11.571.93

Non-Hispanic Native American or Alaskan Indian 

Option SE/SEUR/SFCC

652651 0.6% 

0.76% 0.6% $1.660.17 $2.430.38

Option SI/SC/SCR/SCUR 0.76% 0.76% $1.920.19 $2.800.43

Option SN 0.76% 0.76% $2.010.20 $2.930.46

Option CE 0.76% 0.76% $1.280.13 $1.880.29

Option CI 0.76% 0.76% $1.490.15 $2.170.34

Option NE 0.6% 0.6% $6.290.69 $9.271.55

Option NI 0.6% 0.6% $6.620.72 $9.741.63

All Hispanic 

Option SE/SEUR/SFCC

16,318 15.4% 

21.818.0% 22.217.6% $2.170.20 $3.330.45

Option SI/SC/SCR/SCUR 21.918.1% 22.217.6% $2.470.22 $3.780.51

Option SN 21.918.1% 22.217.6% $2.570.23 $3.940.54

Option CE 21.818.0% 22.117.6% $1.670.15 $2.550.34

Option CI 21.918.1% 22.217.6% $1.910.17 $2.920.39

Formatted Table

Formatted Table

Formatted Table

Formatted Table

Formatted Table

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

May 1, 2013 6-14 

Option NE 21.818.1% 22.117.7% $8.530.85 $13.121.94

Option NI 21.818.1% 22.117.8% $8.910.89 $13.712.03

Option SCRSCUR is the proposed option. 

5510 

5511 

Table 6-6: Summary of Quantified Benefits by Poverty Status (annualized at 3% rate)

Analytical Option 

Population 

Affected 

(thousands) 

Population 

Affected as Percent 

of Total Affected 

Population 

Total Quantified 

Benefits 

Lower Estimate 

(millions 2010$ or 

percent of total) 

Total Quantified 

Benefits 

Higher Estimate

(millions 2010$ or 

percent of total) 

Total Quantified 

Benefits per 

Affected 

Individual 

Lower Estimate

(in dollars) 

Total Quantified 

Benefits per 

Affected 

Individual 

Higher Estimate 

(in dollars) 

All Individuals 

Option SE/SEUR/SFCC

106,057 100.0% 

$16218 $24542 $1.530.17 $2.310.39

Option SI/SC/SCR/SCUR $18420 $27848 $1.740.19 $2.620.45

Option SN $19221 $28950 $1.810.20 $2.730.47

Option CE $12514 $18832 $1.180.13 $1.770.30

Option CI $14216 $21437 $1.340.15 $2.020.34

Option NE $63976 $970178 $6.020.72 $9.151.68

Option NI $66780 $1,013186 $6.290.75 $9.551.76

Individuals Living Below Poverty Line 

Option SE/SEUR/SFCC

13,081 12.3% 

17.514.1% 17.814.5% $2.170.19 $3.330.46

Option SI/SC/SCR/SCUR 17.714.3% 18.014.7% $2.490.22 $3.820.53

Option SN 17.714.3% 18.014.7% $2.600.23 $3.990.56

Option CE 17.514.1% 17.814.5% $1.670.15 $2.560.35

Option CI 17.714.3% 18.014.6% $1.930.17 $2.950.41

Option NE 17.213.9% 17.414.3% $8.380.81 $12.901.94

Option NI 17.314.0% 17.514.4% $8.800.85 $13.552.05

Individuals Living Above Poverty Line

Option SE/SEUR/SFCC

92,631 87.3% 

81.485.6% 8185.1% $1.430.16 $2.150.38

Option SI/SC/SCR/SCUR 81.385.5% 8084.9% $1.620.19 $2.430.44

Option SN 81.285.4% 8084.9% $1.680.19 $2.530.46

Option CE 81.485.7% 8185.1% $1.100.13 $1.640.29

Option CI 81.285.5% 8084.9% $1.250.14 $1.870.34

Option NE 81.885.9% 81.585.3% $5.640.71 $8.541.64

Option NI 81.785.8% 81.485.2% $5.880.74 $8.901.71

Option SCRSCUR is the proposed option. 

The number of individuals above and below the poverty line does not sum to the total number of individuals because poverty status could not 

be determined for some individuals. 

5512 

5513 

Formatted Table

Formatted Table

Formatted Table

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

May 1, 2013 6-15 

Table 6-7: Summary of BenefitsNumber of Cases Avoided by Race, Ethnicity, and Poverty Status under the 

Proposed Option (annualized at 3% rate) 

Population Affected Populati

on 

Affected

(thousan

ds)

Population Affected as 

Percent of Total 

Affected Population

Total Benefits

Lower Estimate

(millions 

2010$)Cancer

Total Benefits

Higher Estimate

(millions 2010$)Eye 

Irritation

Total Benefits

Lower Estimate

(% of total 

affected 

population)

Total 

Benefits

Higher

Estimate

(% of total 

affected 

population

)

lower higher lower higher lower higher

All Individuals 106,0

5710

100%2

4

$18423

,650

$278191,

590 100.0%23,660 100.0%191,615

Minority Race/Ethnicity 36,88

84 35%10 $8610,275

$12877,2

71 46.4%10,279 46.2%77,281

Poverty Status 13,08

12 12%4 $284,935

$4430,75

0 15.4%,937 15.7%30,754

5514 

5515 

Table 6-8: Summary of Number of Cases AvoidedQuantified Benefits by Race, Ethnicity, and Poverty Status 

under the Proposed Option (annualized at 3% rate) 

Population Affected

Populatio

n 

Affected

(thousan

ds)

Populatio

n Affected

as Percent 

of Total 

Affected 

Populatio

n

CancerTot

al 

Quantified 

Benefits

Lower

Estimate

(millions 

2010$)

Eye 

IrritationTot

al Quantified 

Benefits

Higher

Estimate

(millions 

2010$)

AsthmaTot

al 

Quantified 

Benefits

Lower

Estimate

(% of total 

affected 

population)

Fertility

Total Quantified Benefits

Higher Estimate

(% of total affected population)

lower higher lower higher lower higher lower higher

Number of Cases Avoided

All Individuals 10106,

057

24100% 23,650$2

0 191,590$48 2,799100.0%

3,864100.0

%

1,696 28,156 197,175

Minority Race/Ethnicity 436,88

8

1035% 10,275$8 77,271$18 1,32239.6%

1,84738.6

%

708 12,309 79,836

Poverty Status 213,08

1

412% 4,935$3 30,750$7 50614.3% 72114.7%

318 5,761 31,793

5516 

Formatted Table

Deleted Cells

Deleted Cells

Merged Cells

Deleted Cells

Formatted Table

Formatted Table

Inserted Cells

Inserted Cells

Merged Cells

Deleted Cells

Formatted Table

Deleted Cells

Deleted Cells

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

May 1, 2013 6-16 

5517 6.2 Employment Impact Analysis 

5518 

5519 While a standalone analysis of employment impacts is not included in a standard cost-benefit 

analysis61 5520 , such an analysis is of particular concern in the current economic climate of sustained levels of 

5521 high unemployment. Executive Order 13563, states, “Our regulatory system must protect public health, 

5522 welfare, safety, and our environment while promoting economic growth, innovation, competitiveness, and 

5523 job creation” (emphasis added). For this rule, EPA presents a qualitative assessment of the potential for 

5524 employment impacts in the short and long term for producers, fabricators, distributors, and retailers of 

5525 composite wood products and goods made from them. 

5526 

5527 An environmental regulation can be understood as an increase in demand for a particular output: 

5528 environmental quality. Meeting this new demand can result in increased demand for the various factors 

5529 of production (including labor) available to the economy. However, regulated sectors generally have to 

5530 rely on revenues generated by their other (market) outputs to cover the costs of satisfying society's 

5531 increased demand for environmental quality. This increase in the costs can lead to reduced demand by 

5532 regulated sectors for labor and other factors of production. The net effect of an environmental regulation 

5533 on employment in the regulated sectors and the overall economy is therefore indeterminate. The costs 

5534 imposed on directly regulated sectors may affect their competitive position and put some specific jobs at 

5535 risk. At the same time, environmental regulations may create jobs in other sectors, e.g. in the 

5536 environmental protection sector. Tracing out these opposing effects against the temporal dynamics of 

5537 labor markets is complex and makes deriving estimates of how regulations will impact economy-wide net 

5538 employment a difficult task. 

5539 

5540 Adding to this complexity, effects on employment are also likely to change over time. 

5541 Employment in some sectors will be affected at the time of promulgation or when a regulation becomes 

5542 effective, while others will only be affected farther into the future. When the economy is at full 

5543 employment, an environmental regulation is unlikely to have a considerable impact on long run net 

5544 employment; instead, labor would primarily be reallocated from one productive use to another, e.g. from 

5545 producing electricity or steel to producing pollution abatement equipment. Theory and peer-reviewed 

5546 published empirical evidence support the argument that, in the case of full employment, the net 

5547 employment effects from environmental regulation are likely to be small and transitory even in the 

regulated sector and therefore would have an imperceptible impact on the macro economy.62 5548 

5549 

5550 On the other hand, Schmalansee and Stavins (2011) ) point out that positive net employment 

5551 effects are possible in the near term, during a period of sustained unemployment, due to the potential 

5552 hiring of previously unemployed workers by the regulated sector to help meet new requirements (e.g., to 

5553 install new equipment) or by the environmental protection sector to produce new abatement capital. On 

5554 the other hand, it is also theoretically possible to have near term negative net employment effects. For 

5555 example, during periods of sustained high unemployment it may take workers displaced by regulations 

5556 longer to find alternative employment. In the longer term, the net effect on employment is more difficult 

5557 to predict and will depend on the way in which the related industries respond to the regulatory 

5558 requirements and whether the labor market remains in sustained disequilibrium or returns to full 

5559 employment. There are also significant methodological challenges in assessing the net employment 

5560 impacts when the economy is not at full employment. For example, the opportunity cost of labor is more 

5561 difficult to assess, labor demand caused by an environmental regulation may have positive external 

5562 effects (the unemployment rate is reduced as workers are hired), and reductions in labor may give rise to 

 61 Except to the extent that labor costs are part of total costs in a benefit cost analysis. 

62 See Berman and Bui 2001, Morgenstern, et al. 2002. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 6-17 

5563 negative external effects (as higher unemployment rates can be associated with longer durations of 

5564 unemployment). 

5565 

5566 Section 6.2.1 discusses the qualitative assessment of immediate and short term impacts. Section 

5567 6.2.2 describes longer term impacts, focusing primarily on annual, or ongoing, employment impacts in the 

5568 regulated sectors. 

5569 

5570 6.2.1 Immediate and Short Term Employment Impacts 

5571 

5572 There are a number of initial activities that firms may need to perform to comply with this rule, 

5573 depending on the type of firm (panel producer, fabricator, wholesaler, or retailer) and their baseline status. 

5574 In the short term these activities include: 

5575 

5576 Rule Familiarization: Firms will need to read the rule in order to understand the requirements; 

5577 

5578 Testing and Certification: Panel producers will need to perform formaldehyde emission testing on 

5579 their composite wood products and attain certification from an accredited TPC. These entities must 

5580 undergo qualifying tests at a TPC lab, obtain an on-site audit from a TPC, implement quality control 

5581 systems, and train quality control employees in order to receive initial certification; 

5582 

5583 Recordkeeping: Some firms will need to revise their recordkeeping systems in order to comply with 

5584 the chain of custody requirements in the rule; and 

5585 

5586 Labeling: Firms that package or repackage composite wood products or finished goods containing 

5587 composite wood products will need to modify their labels to include their name, the date the finished 

5588 good was produced, and a statement of compliance. 

5589 

5590 Furthermore, some panel producers may need to change their production processes and raw 

5591 materials in order to meet the emission levels required by the rule or to achieve NAF certification. Some 

5592 panel producers may choose to install an on-site lab for quality control testing, so that they can receive 

5593 test results (and thus ship tested lots) quicker than if they hired an off-site lab to perform the testing. And 

5594 some laminators may choose to switch to NAF resins in order to avoid being considered a panel producer 

5595 under the rule. 

5596 

5597 The average first year cost per firm is shown in Table 6-9. There will be a range of actual costs 

5598 incurred, depending on such factors as whether or not the firm is in compliance with the CARB ATCM in 

5599 the baseline; whether or not the firm’s existing recordkeeping systems are sufficient to comply with the 

5600 rule’s chain of custody requirements; the size and complexity of the firm’s operations; and whether or not 

5601 a laminator uses NAF resins and compliant platforms (and thus whether it is considered a platform 

5602 producer or a fabricator under the rule). However, for the sectors with the largest number of firms 

5603 affected by the rule (fabricators, wholesalers, and retailers), the average cost per firm in the first year is 

5604 relatively modest, and is unlikely to create significant employment effects. To the extent that firms in 

5605 these industries have costs that are significantly above average, they will typically be larger firms that 

have additional resources to comply with the rule’s requirements.63 5606 

5607 

5608 Costs per firm are higher for panel producers and laminators. Costs are likely to be the highest 

5609 for stock panel producers that are not CARB certified in the baseline, and for laminators that are 

 63 The average employer firms in the affected fabricator, wholesale, and retail industries have 26, 17, and 32 employees 

per firm, respectively. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 6-18 

5610 considered panel producers. The average number of employees in employer firms in the affected NAICS 

5611 codes is 38 employees per firm for stock panel producers and 26 employees per firm for laminators. 

5612 However, there are only 11 stock panel producers in the U.S. that are not CARB certified for any of their 

5613 products and another 5 that are CARB certified for some but not all of their products. While the analysis 

5614 assumes that 150 to 277 U.S. laminators will be considered panel producers because they will continue to 

5615 use NAF resins, information is not currently available to indicate the particular industries such firms are 

5616 likely to be in, the specific types of products they make, their firm sizes or production volumes, or other 

5617 characteristics that would provide insights into how their employment might be affected by the rule. 

5618 

Table 6-9: Average First Year Cost per Firm for Affected Firms

Type of Firm

Total First Year Cost 

($ million) Number of Firms 

Average First Year Cost per 

Firm 

Low End 

Scenario 

High End 

Scenario 

Low End 

Scenario

High End 

Scenario

Low End 

Scenario

High End 

Scenario

Stock Panel Producers $32 $32 6254 6254 $48,38736,27

7 $48,38736,277

Laminators 1 $55 $102 7,486 13,875 $7,347407 $7,351385

Fabricators $91 $57 72,215492 65,82666,103 $1,260 $866855

Wholesalers $71 $71 85,560 85,560 $830829 $830829

Retailers $215 $215 759,048 759,048 $283 $283 1 Costs to laminators represent the costs to all firms that affix a wood or woody grass veneer to a purchased 

particleboard, MDF or veneer core platform. This includes both laminators that use NAF resins to affix veneer to a 

compliant platform (that are considered to be fabricators under the proposed rule), and laminators that do not use NAF 

resins (that are considered panel producers under the proposed rule). Low and high end scenarios reflect the estimated 

number of laminators and the number of product lines certified per firm, not the low and high costs for each category 

of entities.

5619 

5620 6.2.2 Longer Term Employment Impacts 

5621 

5622 Determining the direction of ongoing employment effects in the regulated industry, in the longer 

5623 term, is challenging due to competing effects. Complying with the new or more stringent regulation 

5624 requires additional inputs, including labor, and may alter the relative proportions of labor and capital used 

5625 by regulated firms in their production processes. Morgenstern, Pizer and Shih (2002) demonstrate that 

5626 environmental regulations can be understood as requiring regulated firms to add a new output 

5627 (environmental quality) to their product mixes. Although legally compelled to satisfy this new demand, 

5628 regulated firms have to finance this additional production with the proceeds of sales of their other 

5629 (market) products. Satisfying this new demand requires additional inputs, including labor, and may alter 

5630 the relative proportions of labor and capital used by regulated firms in their production processes. 

5631 

5632 More specifically, Morgenstern, Pizer, and Shih (2002) decompose the effect of regulation on net 

5633 employment in the regulated sector into the following three subcomponents:

5634 

5635  The Demand Effect: higher production costs from complying with the regulation will raise 

5636 market prices in regulated industries, reducing consumption (and production) of their output, 

5637 thereby reducing demand for labor within the regulated industry. The “extent of this effect 

5638 depends on the cost increase passed on to consumers as well as the demand elasticity of 

5639 industry output” (p. 416). 

5640 

5641  The Cost Effect: Assuming that the capital/labor ratio in the production process is held fixed, 

5642 as “production costs rise, more inputs, including labor, are used to produce the same amount 

5643 of output,” (p. 416). For example, to reduce pollutant emissions while holding output levels 

5644 constant, regulated firms may require additional labor. 

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

May 1, 2013 6-19 

5645 

5646  The Factor-Shift Effect: Regulated firms’ production technologies may be more or less labor 

5647 intensive after complying with the regulation (i.e., more or less labor is required relative to 

5648 capital per dollar of output). “Environmental activities may be more labor intensive than 

5649 conventional production,” meaning that “the amount of labor per dollar of output will rise.” 

5650 However, activities may, instead, be less labor intensive because “cleaner operations could 

5651 involve automation and less employment, for example” (p. 416). 

5652 

5653 The demand effect is expected to have an unambiguously negative effect on employment, the cost 

5654 effect to have an unambiguously positive effect on employment, and the factor-shift effect to have an 

5655 ambiguous effect on employment. Without more information with respect to the magnitudes of these 

5656 competing effects, it is not possible to predict the total effect an environmental regulation will have on 

5657 overall employment levels in the regulated sector. However, regulations that impose smaller costs at the 

5658 firm level are less likely to create noticeable net employment impacts (whether positive or negative) than 

5659 regulations with more significant cost impacts. 

5660 

5661 Morgenstern et al. estimated the effects of pollution abatement expenditures on net employment 

5662 in four highly polluting/regulated sectors (pulp and paper, plastics, steel, and petroleum refining). They 

5663 conclude that increased abatement expenditures generally have not caused a significant change in net 

5664 employment in those sectors. More specifically, their results show that, on average across the industries 

5665 studied, each additional $1 million (1987$) spent on pollution abatement results in a (statistically 

5666 insignificant) net increase of 1.5 jobs. While the specific sectors Morgenstern et al. examined are 

5667 different than the sectors considered here, the methodology that Morgenstern et al. developed is still an 

5668 informative way to qualitatively assess the effects of this rulemaking on employment in the regulated 

5669 sector. 

5670 

5671 The activities required for compliance with the rule in the longer term include the following: 

5672 

5673 Testing and Certification: Once certified, a panel producer is required to conduct on-going small 

5674 scale quality control testing, submit reports to the certifying TPC, and receive on-site audits and large 

5675 chamber testing to maintain its certified status; 

5676 

5677 Recordkeeping: Firms that import, produce, or manufacture composite wood products must keep 

5678 records showing the date of purchase of the composite wood product, the supplier, and all precautions 

5679 taken to ensure that the product meets emissions standards; and 

5680 

5681 Labeling: Firms that package or repackage composite wood products or finished goods containing 

5682 composite wood products will need to modify their labels to include their name, the date the finished 

5683 good was produced, and a statement of compliance. 

5684 

5685 Furthermore, panel producers and laminators that changed their raw materials inputs will continue to 

5686 use the alternative materials. 

5687 

5688 The average subsequent year cost per firm is shown in Table 6-10. Costs in subsequent years are 

5689 less than the cost in the first year. There will be a range of actual costs incurred, based on the factors 

5690 described above for the first year costs. As with the first year costs, the average cost per firm for the 

5691 sectors with the largest number of firms affected by the rule (fabricators, wholesalers, and retailers), is 

5692 relatively modest and is unlikely to create significant employment effects for a typical firm. Costs per 

5693 firm are higher for panel producers and laminators, particularly for stock panel producers that are not 

5694 CARB certified in the baseline, and for laminators that are considered panel producers. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 6-20 

5695 

Table 6-10: Average Subsequent Year Cost per Firm for Affected Firms

Type of Firm

Total Subsequent Year 

Cost ($ million per year) Number of Firms

Average Subsequent Year 

Cost per Firm

Low End 

Scenario 

High End 

Scenario 

Low End 

Scenario 

High End 

Scenario 

Low End 

Scenario 

High End 

Scenario 

Stock Panel Producers $21 $21 6254 6254 $32,25826,7

31 $32,25826,731 

Laminators 1 $17 $30 7,486 13,875 $2,271241 $2,162 

Fabricators $24 $20 72,215492 65,82666,10

3 $332333 $304307 

Wholesalers $14 $14 85,560 85,560 $164158 $164158 

Retailers - - 759,048 759,048 - -0 1 Costs to laminators represent the costs to all firms that affix a wood or woody grass veneer to a purchased 

particleboard, MDF or veneer core platform. This includes both laminators that use NAF resins to affix veneer to a 

compliant platform (that are considered to be fabricators under the proposed rule), and laminators that do not use NAF 

resins (that are considered panel producers under the proposed rule). Low and high end scenarios reflect the estimated 

number of laminators and the number of product lines certified per firm, not the low and high costs for each category 

of entities.

5696 

5697 There are several reasons that the estimates from Morgenstern et al. cannot reasonably be applied 

5698 in this setting to estimate the employment impacts of this rule. First, the industries regulated by this rule 

5699 are not among the four sectors analyzed by Morgenstern et al, and they are different enough in structure 

5700 that estimates would not be directly comparable to the pulp and paper industry that was included in the 

5701 study. Also, Morgenstern et al. focused on pollution abatement costs rather than the types of certification, 

5702 testing, chain of custody, and labeling required by this rule. Finally, the lack of published, peer-reviewed 

5703 research on employment impacts from environmental regulation on the composite wood industry limits 

5704 the ability to defensibly estimate employment impacts of emission standards for composite wood 

5705 products. 

5706 

5707 The three effects described by Morgenstern, Pizer, and Shih can be described for this rule, but the 

5708 magnitudes cannot be estimated. Affected firms will face higher costs to produce and sell their products, 

5709 as certification, quality control procedures, and/or recordkeeping are required for compliance. Economic 

5710 theory, outlined by Morgenstern et al., suggests that the demand effect will have a negative impact on 

5711 employment in the regulated sector. As firms face higher costs of production, market prices for outputs 

5712 will rise and consumer demand will decline, reducing the quantity produced. But the size of the demand 

5713 effect cannot be quantified in this case because information about cost pass through to consumers is not 

5714 available for the regulated sectors. The cost effect reflects the increase in employment required for firms 

5715 to continue producing the same amount of output as prior to the regulation but without elasticity 

5716 information for the markets affected by the rule, it is not possible to determine how production may 

5717 change. The factor shift effect may be positive if quality control, recordkeeping, and other measures 

5718 required by the rule are more labor-intensive than the firms’ ordinary operations, but the relative labor 

5719 intensity is not known. Because the magnitude of these three effects is not known, the net impact on 

5720 employment cannot be estimated. 

5721 

5722 6.2.3 Summary of Employment Impacts 

5723 

5724 The theoretical model developed in Morgenstern et al. cannot predict the net employment impacts 

5725 in the regulated sectors due to the competing effects: the demand effect is negative, the cost effect is 

5726 positive, and the factor shift effect is ambiguous. Therefore the overall effect is ambiguous. Because 

5727 information is not available on the magnitude of each component effect, the overall net effect on 

5728 employment cannot be determined. For example if there were two negative effects (assumes the factor-
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May 1, 2013 6-21 

5729 shift effect is negative) and one positive effect the positive effect might dominate both negative effects, 

5730 depending on their magnitudes, so the overall net effect depends on the magnitude of the competing 

5731 effects. 

5732 

5733 Other uncertainties that characterize this analysis include: uncertainties about firms’ adjustments 

5734 of capital and labor in response to the regulation (factor shift effect); uncertainties regarding labor 

5735 intensities of different equipment and choice of resin types to comply with the standards; uncertainties 

5736 about the types of technologies that may be used for quality control programs; uncertainty about how 

5737 relative market shares of domestic production of composite wood products versus imports may change 

5738 over time; and uncertainties about how demand for composite wood products is affected by business 

5739 cycle fluctuations. 

5740 

5741 Given the current level of unemployment, net positive employment effects are possible, 

5742 especially in the near term, due to the potential hiring of idle labor resources by the regulated sector to 

5743 plan for and meet new requirements. In the future, when full employment is expected to return, any 

5744 changes in employment levels in the regulated sector due to this program are expected to be mostly offset 

5745 by employment changes in other sectors. 

5746 
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5747 6.3 Paperwork Burden Analysis 

5748 

5749 This section presents a summary of the burden and associated costs for the respondents associated 

5750 with the recordkeeping and reporting requirements of the proposed TSCA Title VI Implementation Rule. 

5751 The detailed paperwork burden analysis is presented in the information collection request (ICR) 

5752 supporting statement for this proposed rulemaking. It provides the average annual burden and cost 

5753 estimates for the next three years of the program. 

5754 

5755 The paperwork burden and associated costs include the activity types listed below. Note that not 

5756 all entities will incur burden or costs from these activities because they may already be meeting the 

5757 requirements under the CARB ATCM and/or their existing recordkeeping and labeling systems may 

5758 already be sufficient. 

5759 

5760  Rule Familiarization: All respondents will need to read the rule in order to understand 

5761 the requirements; 

5762  Testing and Certification: All composite panel producers will need to perform 

5763 formaldehyde emission testing on their composite wood products and attain certification 

5764 from an accredited TPC. These entities must undergo qualifying tests at a TPC lab, 

5765 obtain an on-site audit from a TPC, implement quality control systems, and train quality 

5766 control employees in order to receive initial certification. Once certified, a mill is 

5767 required to conduct on-going small scale quality control testing, submit monthly reports 

5768 to the certifying TPC, and receive quarterly on-site audits and large chamber testing to 

5769 maintain its certified status. Mills that produce products made with NAF resins that meet 

5770 more stringent emissions limits may apply for exemptions from some of the on-going 

5771 testing requirements; 

5772  Recordkeeping: Firms that import, produce, or manufacture composite wood panels, 

5773 component parts, or finished goods are required to keep records showing the date of 

5774 purchase of the composite wood product, the supplier, and all precautions taken to ensure 

5775 that the product meets emissions standards. Wholesalers and retailers that do not import, 

5776 produce, or manufacture composite wood panels, component parts, or finished goods are 

5777 required to maintain invoices and bills of lading; and 

5778  Labeling: Firms that package or repackage composite wood products or finished goods 

5779 containing composite wood products will need to modify their labels to include their 

5780 name, the date the finished good was produced, and a statement of compliance. 

5781 

5782 Note that the paperwork burden analysis in the ICR treats some baseline burdens and costs 

5783 differently from the cost analysis in Chapter 2 of this economic analysis. Neither analysis includes 

5784 burdens or costs that were already performed to meet the CARB ATCM requirements and will not need to 

5785 be performed again to comply with the TSCA Title VI requirements. For example, both analyses assume 

that mills making product lines that have a standard certification64 5786 or a NAF certification under the CARB 

5787 ATCM will not need to submit new data or resubmit existing data to their existing TPC in order to receive 

5788 the equivalent certification under the TSCA Title VI regulations and therefore burdens and costs are not 

5789 estimated for these activities. 

5790 

 64 The term standard certification is used here to describe a certification other than an ultra-low-emitting formaldehyde 

(ULEF) or NAF certification. The proposed rule does not provide for reduced testing frequencies for products made 

with ULEF resins, so mills that have a ULEF certification under the CARB ATCM will incur additional costs under the 

TSCA Title VI rule. 
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May 1, 2013 6-23 

5791 The cost analysis in Chapter 2 of this economic analysis calculates the incremental cost of the 

5792 TSCA Title VI rule. The incremental cost excludes the costs associated with activities performed in the 

5793 baseline such as TPC audits at CARB certified panel producers, and recordkeeping at firms that sell 

5794 products in California. The paperwork burden analysis in the ICR calculates the incremental burdens and 

5795 costs of the rule, but it also calculates total burden and costs including activities that are performed to 

5796 comply with the CARB ATCM in the baseline. Furthermore, the cost analysis in Chapter 2 is limited to 

5797 domestic entities, while the ICR considers the burden and cost to both domestic and foreign entities. 

5798 

5799 Table 6-11 presents the summary of the three year average incremental and total cost burden. 

5800 The columns labeled total burden and total cost present the bottom line burden and cost for the ICR. The 

5801 columns labeled incremental burden and incremental cost present the burdens and costs with the baseline 

5802 assumptions that are consistent with the economic analysis in Chapter 2. Note that these burden and cost 

5803 estimates differ slightly from those presented in Chapter 2 because the unit burdens and costs are rounded 

5804 slightly differently for the calculations. This is necessary because a different level of disaggregation is 

5805 needed for the ICR supporting statement. (The ICR supporting statement calculates the costs at the 

5806 activity level, while the cost analysis calculates them at the establishment level.) In addition, costs 

5807 associated with changes to production processes or raw materials are not considered paperwork burden 

5808 and therefore not included in the paperwork burden analysis. See the ICR supporting statement for a 

5809 detailed description of how these calculations were performed. 

5810 

Table 6-11: Summary of Three Year Average Incremental and Total Burden Hours and Costs, 

by Geographic Location ($2010) 

Respondent Type 

Number of 

Respondents 

Incremental Burden 

Hours (excludes 

baseline burden) 

Incremental Cost 

(excludes baseline 

cost) 

Total Burden 

Hours (includes 

baseline burden) 

Total Cost 

(includes baseline 

cost) 

Domestic

Producers 370 193,453187,274 $21,680,292128,772 221,328215,023 $24,683,876064,208 

Fabricators 79,701 1,837,729866,226 $62,701,57964,002,296 2,608,828637,325 $81,855,67883,156,395 

Wholesalers 85,560 841,827813,330 $32,656,18731,360,750 1,156,087127,590 $40,682,38739,386,950 

Retailers 759,048 1,011,963 $71,555,904563,045 1,011,963 $71,555,904563,045 

Total 924,679 3,884,972878,793 $188,593,962054,863 4,998,206991,901 $218,777,845170,598 

Foreign

Producers 1,129 234,293170,643 $25,977,52920,070,682 $477,692 412,218 $53,971,65347,412,391 

Fabricators 31,083 716,285727,417 $24,441,066949,118 1,020,576031,708 $31,999,65532,507,707 

Wholesalers 33,368 1,029,608018,476 $33,513,802008,510 1,467,274456,142 $44,691,791186,499 

Retailers - - - - -

Total 65,580 1,980,186916,536 $83,932,39778,028,310 2,965,542900,068 $130,663,099124,106,597 

Total

Producers 1,499 427,744357,917 $47,657,67841,199,455 $699,020 627,241 $78,655,52871,476,599

Fabricators 110,784 2,554,012593,643 $87,142,55588,951,415 3,629,402669,033 $113,855,243115,664,102 
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May 1, 2013 6-24 

Wholesalers 118,928 1,871,434831,806 $66,169,96364,369,234 2,623,362583,732 $85,374,20483,573,449 

Retailers 759,048 1,011,963 $71,555,904563,045 1,011,963 $71,555,904563,045 

Total 990,259 5,865,153795,329 $272,526,100266,083,149 7,963,747891,969 $349,440,879342,277,195 

5811 
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May 1, 2013 6-25 

5812 6.4 Unfunded Mandates Reform Act (UMRA) 

5813 

5814 Title II of the Unfunded Mandates Reform Act of 1995, Pub. L. 104-4, establishes 

5815 requirements for Federal agencies to assess the effects of their regulatory actions on State, local, and 

5816 Tribal governments, and the private sector. Under section 202 of the UMRA, EPA generally must 

5817 prepare a written statement, including a cost-benefit analysis, for proposed and final rules with “Federal 

5818 mandates” that might result in expenditures by State, local, and Tribal governments, in the aggregate, or 

5819 by the private sector, of $100 million or more (when adjusted annually for inflation) in any one year. The 

5820 proposed rule is not expected to affect state, local, or Tribal governments because the proposed rule 

5821 affects entities that manufacture, import, or sell composite wood products, and government entities are 

5822 not engaged in these activities. 

5823 
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May 1, 2013 6-26 

5824 6.5 Executive Order 13132 - Federalism 

5825 

5826 Executive Order 13132, entitled Federalism (64 FR 43255, August 10, 1999), directs federal 

5827 agencies to consider whether a rule has federalism implications (i.e. whether it has substantial direct 

5828 effects on the states, on the relationship between the national government and the states, or on the 

5829 distribution of power and responsibilities among the various levels of government, as specified in 

5830 Executive Order 13132). 

5831 

5832 The proposed rule does not have any direct effects on states or local governments (individually or 

5833 collectively), on the relationship between the national government and the states, or on the distribution of 

5834 power and responsibilities among the various levels of government. No state or local governments are 

5835 expected to engage in the import, manufacture, or sale of composite wood products, and thus state and 

5836 local governments will not incur direct compliance costs as a result of the rule. The rule does not preempt 

5837 state or local law, and the rule is required by statute. 

5838 
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May 1, 2013 6-27 

5839 6.6 Executive Order 13175 - Tribal Implications 

5840 

5841 Executive Order 13175, entitled Consultation and Coordination with Indian Tribal Governments

5842 (59 FR 22951, November 6, 2000), directs federal agencies to consider whether a rule has tribal 

5843 implications (i.e. whether it has substantial direct effects on tribal governments, on the relationship 

5844 between the Federal government and the Indian tribes, or on the distribution of power and responsibilities 

5845 between the Federal government and Indian tribes). No tribal government is expected to engage in the 

5846 import, manufacture, or sale of composite wood products, and thus tribal governments will not incur 

5847 direct compliance costs as a result of the rule. The rule does not change the relationship between the 

5848 Federal government and Indian tribes, or change the distribution of power. 

5849 
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May 1, 2013 6-28 

5850 6.7 Executive Order 13045 - Protection of Children 

5851 

5852 Under Executive Order 13045, a regulation must be reviewed if the regulatory action is 

5853 economically significant and concerns an environmental health risk or safety risk that may 

5854 disproportionately affect children. This analysis shows that the per-child benefits from this proposed rule 

5855 are substantially larger than the average benefit per person across individuals of all ages.This proposed 

5856 rule is not economically significant, but EPA has nevertheless evaluated the environmental health effects 

5857 of formaldehyde emissions from composite wood products on children. The economic analysis only 

5858 monetizes the potential benefits associated with avoided cases of nasopharyngeal cancer and eye 

5859 irritation, some of which clearly would accrue to children. However, as indicated above, some studies 

5860 have reported associations between elevated levels of formaldehyde levels and other health endpoints, 

5861 such as respiratory symptoms. To the extent that the reductions reported in this rule would lead to 

5862 reduced respiratory symptoms in children, the monetized estimate for cancer alone is likely an 

5863 underestimate. As shown in Table 6-12, children under the age of two represent 53 percent of the 

5864 individuals affected by the rule and are estimated to accrue between 0.3 and 1.710 percent of the proposed 

5865 rule’s total quantified benefits. Children aged two through fifteen represent 1920 percent of the 

5866 individuals affected by the rule and are estimated to accrue about 7516 to 22 percent of the proposed 

5867 rule’s total quantified benefits. These results are driven by the benefits associated with avoiding asthma 

5868 incidence, which are only estimated for children ages 6 through 17 for the lower benefits estimate and for 

5869 children ages 2 through 17 for the higher benefits estimate. Given these results, EPA has determined that 

5870 this proposed rule will not have disproportionally high and adverse human health or environmental effects 

5871 on children. These proposed standards would reduce emissions of formaldehyde from composite wood 

5872 products for individuals of all ages that are exposed and children are likely to accrue similar or higher 

5873 benefits from the exposure reductions compared to adults. 

5874 

Table 6-12: Summary of Quantified Benefits for Children Compared with All Individuals under the 

Proposed Option (annualized at 3% rate) 

Population Affected 

Population 

Affected 

Annually 

(thousands) 

Population 

Affected as 

Percent of 

Total Affected 

Population 

Total 

Quantified 

Benefits 

Lower Estimate

(millions 2010$)

Total Quantified 

Benefits 

Higher Estimate

(millions 2010$)

Total Quantified 

Benefits 

Lower Estimate

(% of total 

affected 

population) 

Total Quantified 

Benefits 

Higher Estimate 

(% of total 

affected 

population) 

All Individuals 106,057 100.00% $184.3120.22 $277.9247.63 100.00% 100.00% 

Children ages 0-1 4,9713,309 4.693.12% $0.47 $4.79 0.262.35% 1.7210.06% 

Children ages 2-15 19,65121,31

2 18.5320.10% $136.953.16 $209.9910.57 74.3115.63% 75.5622.19% 

5875 

5876 
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May 1, 2013 6-29 

5877 6.8 Executive Order 13211 - Energy Effects 

5878 

5879 Executive Order 13211, entitled Actions Concerning Regulations that Significantly Affect Energy 

5880 Supply, Distribution, or Use (66 FR 28355, May 22, 2001), directs federal agencies to identify actions 

5881 that will have a significant adverse energy effect. Adverse effects are defined as: 

5882 

5883  Reductions in crude oil supply in excess of 10,000 barrels per day; 

5884  Reductions in fuel production in excess of 4,000 barrels per day; 

5885  Reductions in coal production in excess of 5 million tons per year; 

5886  Reductions in natural gas production in excess of 25 million mcf per year; 

5887  Reductions in electricity production in excess of 1 billion kilowatt-hours per year or in excess of 

5888 500 megawatts of installed capacity; 

5889  Increases in energy use required by the regulatory action that exceed any of the thresholds above; 

5890  Increases in the cost of energy production in excess of one percent; 

5891  Increases in the cost of energy distribution in excess of one percent; or 

5892  Other similarly adverse outcomes. 

5893 

5894 The regulations under consideration will not significantly reduce energy production nor significantly 

5895 increase energy costs. 

5896 
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May 1, 2013 6-30 

5897 6.9 National Technology Transfer and Advancement Act 

5898 

5899 Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (“NTTAA”), 

5900 Public Law No. 104-113 (15 U.S.C. 272 note) directs EPA to use voluntary consensus standards in its 

5901 regulatory activities unless to do so would be inconsistent with applicable law or otherwise impractical. 

5902 Voluntary consensus standards are technical standards (e.g., materials specifications, test methods, 

5903 sampling procedures, and business practices) that are developed or adopted by voluntary consensus 

5904 standards bodies. 

5905 

5906 The proposed rule involves numerous technical standards, many of which EPA is directed to use 

5907 by TSCA Title VI. Technical standards identified in the statute include the two quarterly test methods, 

5908 ASTM E-1333-96 and ASTM D-6007-02, a quality control test method, ASTM D-5582-00, and various 

5909 standards that define specific composite wood products, such as ASTM D-5456-06 (Structural Composite 

5910 Lumber Products), ASTM D-5055-05 (Prefabricated Wood I-Joists), ANSI A190.1 (Structural Glued 

5911 Laminated Timber), ANSI/HPVA HP–1–2009 (Hardwood and Decorative Plywood), ANSI A208.2–2 

5912 2009 (Medium Density Fiberboard), ANSI A208.1–2009 (Particleboard), PS-1-07 (Structural Plywood), 

5913 and PS-2-04 (Wood-Based Structural-Use Panels). 

5914 

5915 The proposed rule also incorporates other voluntary consensus standards that EPA has identified, 

5916 including the standards that define hardboard (ANSI A135.4, ANSI A135.5, and ANSI A135.6) and three 

5917 alternative quality control test methods: EN 717-2 (gas analysis), EN 120 (perforator), and JIS A 1460 

5918 (24-hour desiccator).
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May 1, 2013 R-1 

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6036 National Research Council (NRC). 2011. Review of the Environmental Protection Agency's Draft 

6037 IRIS Assessment of Formaldehyde, Washington, DC: The National Academies Press. 

6038 Neghab, M., A. Soltanzadeh and A. Choobineh. 2011. Respiratory Morbidity Induced by 

6039 Occupational Inhalation Exposure to Formaldehyde. Industrial Health. 49(1): 89-94. 

6040 Personal Communication with AHFA. 2010. Conversation between Bill Perdue (American Home 

6041 Furnishings Alliance) and Abt Associates Inc. November 3, 2010. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 R-4 

6042 Personal Communication with AWI. 2010. Conversation between Phil Duvic (Architectural 

6043 Woodwork Institute) and Abt Associates Inc. November 18, 2010. 

6044 Personal Communication with BIFMA. 2010. Brad Miller's (BIFMA) Written Responses to 

6045 Questions about FSCWPA Impacts on Members. November 23, 2011. 

6046 Personal Communication with California Retailers Association. 2011. Conversation between 

6047 Pamela Williams (California Retailers Association) and Abt Associates Inc. January 20, 2011. 

6048 Personal Communication with CPA. 2011. Conversation between Chris Surak (CPA) and Abt 

6049 Associates. January 21, 2011. 

6050 Personal Communication with Evergreen Engineering. 2009. Communication between David 

6051 Smith (Evergreen Engineering) and Abt Associates. August 31, 2009. 

6052 Personal Communication with HPVA. 2011a. Conversation between Kip Howlett (HPVA) and 

6053 Abt Associates Inc. January 4, 2011. 

6054 Personal Communication with HPVA. 2011b. Conversation between Brian Sause (HPVA) and 

6055 Abt Associates. January 28, 2011. 

6056 Personal Communication with KCMA. 2010. Conversation between Richard Titus (Kitchen 

6057 Cabinet Manufacturers Association) and Abt Associates Inc. regarding written questions about 

6058 FSCWPA Impacts. October 28, 2010. 

6059 Personal Communication with NALFA. 2010. Conversation between Dennis Bradway 

6060 (Mannington Floors and North Amnerican Laminate Floor Association) and Abt Associates Inc. 

6061 regarding written questions about FSCWPA Impacts. November 22, 2010. 

6062 Piccirillo, J. F., I. Costas and M. E. Reichman. 2007. Cancers of the Head and Neck. SEER 

6063 Survival Monograph: Cancer Survival Among Adults: U.S. SEER Program, 1988-2001, Patient 

6064 and Tumor Characteristics. L. A. Ries, J. L. Gloeckler, G. E. Young, M. P. Keel, Y. D. L. Eisner 

6065 and M.-J. D. Horner. Bethesda, MD, National Cancer Institute, SEER Program, NIH Pub. No. 07-

6066 6215: 7-22. 

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6069 PubMed Health. 2010. Hypothyroidism. Available at: 

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6071 Random Lengths. 2009. 2009 Big Book: The Buyers and Sellers Directory of the Forest Products 

6072 Industry. Eugene, OR. 

6073 Rice, C. 2002. Wage Rates for Economic Analysis of the Toxics Release Inventory Program. 

6074 Ries, L. A. G., J. L. Young, G. E. Keel, M. P. Eisner, Y. D. Lin and M. J. Horner. 2007. SEER 

6075 Survival Monograph: Cancer Survival Among Adults: U.S. SEER Program, 1988-2001, Patient 

6076 and Tumor Characteristics. S. P. National Cancer Institute. Bethesda, MD. 

6077 RISI. 2009. A Monthly Economic Analysis of the North American Particleboard and MDF 

6078 Markets. Particleboard and MDF Commentary. 

6079 RISI. 2011a. Crow's Weekly Market Report. March 18, 2011. 

6080 RISI. 2011b. Crow's Weekly Market Report. February 18, 2011. 

6081 RISI. 2011c. Crow's Price Data: Southern Pine - 3/4" - U.S. Southeast. Accessed March 21, 

6082 2011. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 R-5 

6083 RISI. 2011d. Particleboard and MDF Commentary. January 2011. 

6084 SalesGenie. 2010. Business to Business Directory: California, NAICS 337110. Available at: 

6085 http://www.salesgenie.com/ (Accessed December 17,) 

6086 Schlosser, P., P. Lilly, R. Conolly, D. Janszen and J. Kimbell. 2003. Benchmark dose risk 

6087 assessment for formaldehyde using airflow modeling and a single-compartment, DNA-protein 

6088 cross-link dosimetry model to estimate human equivalent doses. Risk Analysis. 23: 473–487. 

6089 Schmalensee, R. and R. N. Stavins. 2011. A Guide to Economic and Policy Analysis of EPA’s 

6090 Transport Rule. White paper commissioned by Excelon Corporation. 

6091 SEER Program (www.seer.cancer.gov). 2010. Survival of nasopharynx cancer. SEER*Stat 

6092 Database: Incidence - SEER 13 Regs Research Data, Nov 2010 Sub (1992-2007). Acessed 

6093 October 12, 2011. 

6094 Stavins, R. 2001. Lessons from the American Experiment with Market-Based Environmental 

6095 Policies. October 1, 2001. 

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6097 Lindbohm and A. Anttila. 1999. Reduced Fertility Among Female Wood Workers Exposed to 

6098 Formaldehyde. American Journal of Industrial Medicine. 36: 202-221. 

6099 Tham, I. W. K. and J. J. Lu. 2010. Post-treatment Follow-Up of Patients with Nasopharyngeal 

6100 Cancer. Nasopharyngeal Cancer. J. J. Lu, J. S. Cooper and A. W. M. Lee, Springer Berlin 

6101 Heidelberg: 233-240. 

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6103 1-4, Final Report to the US Environmental Protection Agency. University of Chicago, Chicago, 

6104 IL. 

6105 U.S. Bureau of Economic Analysis. 2011a. National Income and Product Accounts Table 2.1 

6106 Personal Income and Its Disposition. 

6107 U.S. Bureau of Economic Analysis. 2011b. National Income and Product Accounts Table 3.4U. 

6108 Personal Current Tax Receipts. 

6109 U.S. Bureau of Labor Statistics. 2010a. Employer Costs for Employer Compensation. Series ID 

6110 CMU2020000000000D. . 

6111 U.S. Bureau of Labor Statistics. 2010b. May 2009 National Industry-Specific Occupational 

6112 Employment and Wage Estimates. NAICS 321000 - Wood Product Manufacturing. 

6113 U.S. Bureau of Labor Statistics. 2010c. May 2009 National Industry-Specific Occupational 

6114 Employment and Wage Estimates. Sectors 44 and 45 - Retail Trade. 

6115 U.S. Bureau of Labor Statistics. 2010d. May 2009 National Industry-Specific Occupational 

6116 Employment and Wage Estimates. Sector 42 - Wholesale Trade. 

6117 U.S. Bureau of Labor Statistics. 2010e. Employer Costs for Employer Compensation. Series ID 

6118 CMU2020000000000P. . 

6119 U.S. Bureau of Labor Statistics. 2011a. National Compensation Survey: Occupational Earnings 

6120 in the United States, 2010. Table 2. 

6121 U.S. Bureau of Labor Statistics. 2011b. Employer Costs for Employee Compensation, Total 

6122 Benefits, All civilian occupations. Series ID CMU2030000000610D, CMU2030000000610P, 

6123 CMU2030000000620D, CMU2030000000620P. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 R-6 

6124 U.S. Bureau of Labor Statistics. 2011c. Labor Force Statistics from the Current Population 

6125 Survey. Quarter 1, 2011. 

6126 U.S. Census Bureau. 1997. 1992 Enterprise Statistics: Company Summary. 

6127 U.S. Census Bureau. 2009a. Sector 42: EC0742I1: Wholesale Trade: Industry Series: 

6128 Preliminary Summary Statistics for the United States: 2007. 

6129 U.S. Census Bureau. 2009b. Sector 31: EC0731I2: Manufacturing: Industry Series: Products 

6130 Statistics for the United States: 2007. 

6131 U.S. Census Bureau. 2009c. American Housing Survey Microdata. 

6132 U.S. Census Bureau. 2009d. 2007-2009 American Community Survey (ACS) 3-Year Estimates. 

6133 U.S. Census Bureau. 2009e. Sector 31: EC0731I3: Manufacturing: Industry Series: Materials 

6134 Consumed by Kind for the United States: 2007. December 29, 2010. 

6135 U.S. Census Bureau. 2010a. Sector 31: EC0731A1: Manufacturing: Geographic Area Series: 

6136 Industry Statistics for the States. 

6137 U.S. Census Bureau. 2010b. Sector 44: EC0744A1: Retail Trade: Geographic Area Series: 

6138 Summary Statistics for the United States, States, Metro Areas, Counties, and Places: 2007. 

6139 U.S. Census Bureau. 2010c. Data Item: Wholesale type of operation.” American FactFinder 

6140 Help. Census Data Information. 

6141 U.S. Census Bureau. 2010d. Sector 00: NS0800A2: 2008 Nonemployer Statistics: Geographic 

6142 Area Series: Nonemployer Statistics for the US, States, Metropolitan Areas, and Counties: 2008. 

6143 U.S. Census Bureau. 2010e. Number of Firms, Number of Establishments, Employment, Annual 

6144 Payroll, and Estimated Receipts by Enterprise Employment Size for States, NAICS Sectors: 2007. 

6145 December 15, 2010. 

6146 U.S. Census Bureau. 2010f. Sector 42: EC0742SSSZ5: Wholesale Trade: Subject Series - Estab 

6147 & Firm Size: Summary Statistics by Employment Size of Firms for the United States: 2007. 

6148 U.S. Census Bureau. 2010g. Sector 44: EC0744SSSZ4: Retail Trade: Subject Series - Estab & 

6149 Firm Size: Summary Statistics by Sales Size of Firms for the United States: 2007. 

6150 U.S. Census Bureau. 2010h. Sector 42: EC0742SSSZ2: Wholesale Trade: Subject Series - Estab 

6151 & Firm Size: Summary Statistics by Employment Size of Establishments for the United States: 

6152 2007. 

6153 U.S. Census Bureau. 2010i. Census Data Information. Survey Methodology: 2007 Economic 

6154 Census: Retail Trade: Subject Series: Product Lines. 

6155 U.S. Census Bureau. 2010j. Sector 44: EC0744SLLS1: Retail Trade: Subject Series - Product 

6156 Lines: Product Lines Statistics by Kind of Business for the United States and States: 2007. 

6157 U.S. Census Bureau. 2010k. Sector 31: EC0731SG3: Manufacturing: Summary Series: General 

6158 Summary: Industry Statistics for Subsectors and Industries by Employment Size: 2007. 

6159 U.S. Census Bureau. 2010l. Sector 00: NS0800A1: 2008 Nonemployer Statistics: Geographic 

6160 Area Series: Nonemployer Statistics by Legal Form of Organization: 2008 

6161 U.S. Census Bureau. 2010m. Census Data Information. Sector 44: EC0744SLLS1: Retail Trade: 

6162 Subject Series - Product Lines: Product Lines Statistics by Kind of Business for the United States 

6163 and States: 2007. Data Item: Products and Services Code. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 R-7 

6164 U.S. Census Bureau. 2010n. Sector 31: Manufacturing: EC0731SG1: Summary Series: General 

6165 Summary: Industry Statistics for Industry Groups and Industries: 2007. 

6166 U.S. Census Bureau. 2010o. Sector 42: EC0742SSSZ3: Wholesale Trade: Subject Series - Estab 

6167 & Firm Size: Summary Statistics for Single Units and Multiunit Firms for the United States: 

6168 2007. 

6169 U.S. Census Bureau. 2010p. Sector 44: EC0744SSSZ3: Retail Trade: Subject Series - Estab & 

6170 Firm Size: Summary Statistics for Single Unit and Multiunit Firms for the United States: 2007. 

6171 U.S. Census Bureau. 2011. Sector 42: EC0742SLLS1: Wholesale Trade: Subject Series - Product 

6172 Lines: Product Lines Statistics by Kind of Business for the United States and States: 2007. 

6173 U.S. Department of Health and Human Services (HHS) National Toxicology Program. 2011. 12th 

6174 Report on Carcinogens. June 10, 2011. 

6175 U.S. Environmental Protection Agency. 1998. Industry Specific Information Collection Request 

6176 (ICR) for the Development of Plywood and Particleboard Maximum Achievable Control 

6177 Technology (MACT) Standards. 

6178 U.S. Environmental Protection Agency. 2001. EPA Cost of Illness Handbook. Available at: 

6179 http://www.epa.gov/oppt/coi/ (Accessed March 10, 2011) 

6180 U.S. Environmental Protection Agency. 2006. National Emission Standards for Hazardous Air 

6181 Pollutants: Plywood and Composite Wood Products; List of Hazardous Air Pollutants, Lesser 

6182 Quantity Designations, Source Category List; Final Rule. Federal Register (71 FR 8341, 

6183 February 16, 2006) (FRL–8028–9). 

6184 U.S. Environmental Protection Agency. 2010a. U.S. EPA Pressed Wood Manufacturing Industry 

6185 Survey. 

6186 U.S. Environmental Protection Agency. 2010b. Memorandum from Peter Preuss to Steve Page 

6187 entitled “Recommendation for Formaldehyde Inhalation Cancer Risk Values. January 22, 2010. 

6188 U.S. Environmental Protection Agency. 2010c. IRIS Toxicological Review of Formaldehyde6189 Inhalation Assessment (External Review Draft). Washington, DC, U.S. Environmental Protection 

6190 Agency. 

6191 U.S. Environmental Protection Agency. 2013. Approach to Assessing Non-cancer Health Effects 

6192 from Formaldehyde and Benefits from Reducing Noncancer Health Effects as a Result of 

6193 Implementing Formaldehyde Emission Limits for Composite Wood Products. 

6194 U.S. Internal Revenue Service. 2007. Starting a Business and Keeping Records. Publication 583. 

6195 Revised January 2007. 

6196 U.S. International Trade Commission. 2008. Wood Flooring and Hardwood Plywood: 

6197 Competitive Conditions Affecting the U.S. Industries. 

6198 U.S. International Trade Commission. 2011. U.S. Interactive Tariff and Trade Dataweb. 

6199 U.S. International Trade Commission (U.S. ITC). 2011a. HTS - 4408: Veneer Sheets and Sheets 

6200 for Plywood and Other Wood Sawn Lengthwise, Sliced or Peeled, Not More Than 6 mm (.263 in. 

6201 Thick: U.S. Domestic Exports: Annual Data: 2007. 

6202 U.S. International Trade Commission (U.S. ITC). 2011b. HTS - 4408: Veneer Sheets and Sheets 

6203 for Plywood and Other Wood Sawn Lengthwise, Sliced or Peeled, Not More Than 6 mm (.263 in. 

6204 Thick: U.S. Imports for Consumption: Annual Data: 2007. 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 R-8 

6205 United States Postal Service. 2011. First-Class Mail Prices. Available at: 

6206 http://www.usps.com/prices/first-class-mail-prices.htm (Accessed February 23,) 

6207 Weitzel, D. L. 1990. Economic Valuation of Environmental Health Benefits: A Review of the 

6208 Literature, National Economic Research Associates, Inc. Report to the Washington State 

6209 Department of Ecology. 

6210 Will, A. 2010. Estimating National Levels of Home Improvement and Repair Spending by Rental 

6211 Property Owners, Joint Center for Housing Studies, Harvard University. 

6212 

6213 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 A-9 

6214 Appendix A: Product Lines Assumed to Include Composite Wood Products

6215 

6216 Table A-1 and Table A-2 present the product lines that are assumed to contain composite wood 

6217 products. Census data on the number of firms that sell these product lines was used to estimate the 

6218 number of retail and wholesale firms affected by the rule’s requirements.

6219 

Table A-1: Retail Trade Sector Affected Product Line Key

Product 

Line Code Meaning of Products and services code Product Line Level

Composite Wood 

Product Line?

20000 Industry total Total Yes

20100 Groceries & other foods for human consumption off the premises Broad

20101 Meat, fish, seafood& poultry, incl prepack meats req refrigeration Detailed

20102 Produce, including fresh & prepackaged fruits & vegetables Detailed

20103 Frozen foods, incl packaged foods sold in a frozen state Detailed

20104 Dairy products & related foods, incl milk, cheese, butter, etc Detailed

20105 Bakery products baked on premises Detailed

20106 Bakery products not baked on the premises, excl frozen Detailed

20107 Delicatessen items, incl deli meats & other service deli items Detailed

20108 Bottled, canned, or packaged soft drinks Detailed

20109 Candy Detailed

20111 All other foods Detailed

20113 All other foods Detailed

20114 All other foods Detailed

20130 Alcoholic beverages served for immediate consumption Broad

20140 Packaged liquor, wine, & beer Broad

20141 Distilled spirits, including liquor, brandy, & liqueurs Detailed

20142 Wine Detailed

20143 Beer & ale Detailed

20150 Cigars, etc & smokers' access, excl sls from vending op by others Broad

20160 Drugs, health aids, beauty aids, including cosmetics Broad

20161 Prescriptions Detailed

20162 Nonprescription medicines Detailed

20163 Vitamins, minerals, & other dietary supplements Detailed

20164 Health aids, incl first-aid prod; foot prod; ortho equip; etc Detailed

20165 Cosmetics, incl face cream, make-up, perfumes & colognes etc Detailed

20166 Oth hygiene needs, incl deodorants; hair & shaving products, etc Detailed

20167 Hearing aids & supplies Detailed

20180 Soaps, detergents, & household cleaners Broad

20190 Paper & related prod, incl paper towels, toilet tissue, wraps, etc Broad

20200 Men's wear, including accessories Broad

20201 Men's overcoats, topcoats, raincoats, outer jackets Detailed

20202 Men's suits & formal wear Detailed

20203 Men's sport coats & blazers Detailed

20204 Men's tailored & dress slacks Detailed

20205 Men's casual slacks & jeans, walking shorts, etc. Detailed

20206 Men's career & work uniforms Detailed

20207 Men's dress shirts Detailed

20208 Men's sport shirts, incl t-shirts, knit & woven shirts, etc Detailed

20209 Men's sweaters Detailed

20211 Men's hosiery, pajamas, robes, underwear Detailed

20212 Men's sports apparel, incl tennis, golf, jogging, swimming, etc Detailed

20214 Men's accessories, incl hats, gloves, neckwear, handkerchiefs, etc Detailed

20215 Custom-made garments Detailed

20216 Men's sweat tops, pants, & warm-ups Detailed

20217 Other men's wear Detailed

20220 Women's, juniors', and misses' wear, including accessories Broad

20221 Furs, fur garments Detailed

20222 Dresses, including all types Detailed
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 A-10 

Table A-1: Retail Trade Sector Affected Product Line Key

Product 

Line Code Meaning of Products and services code Product Line Level

Composite Wood 

Product Line?

20223 Dressy & tailored coats, outer jackets, rainwear Detailed

20224 Suits, pantsuits, sport jackets, blazers Detailed

20225 Slacks/pants, jeans, walking shorts, skirts Detailed

20226 Tops, incl t-shirts, knit & woven shirts, blouses, sweaters Detailed

20227 Women's sports apparel, incl tennis, golf, jogging, swimming, etc Detailed

20229 Hosiery, including pantyhose, socks, tights Detailed

20231 Bras, girdles, corsets Detailed

20232 Lingerie, sleepwear, loungewear Detailed

20233 Hats, wigs, hairpieces Detailed

20234 Accessories, incl handbags, wallets, neckwear, gloves, belts, etc Detailed

20235 Custom-made garments Detailed

20236 Women's sweat tops, pants, & warm-ups Detailed

20237 Oth apparel, incl uniforms, smocks & oth apparel items Detailed

20238 Other women's, juniors', & misses' wear Detailed

20240 Children's wear, incl boys', girls', infants' & toddlers' Broad

20241 Boys' (sizes 2 to 7 and 8 to 20) clothing & accessories Detailed

20242 Girls' (sizes 4 to 6x and 7 to 14) clothing & accessories Detailed

20243 Infants' & toddlers' clothing & accessories Detailed

20260 Footwear, including accessories Broad

20261 Men's footwear, including dress & casual footwear Detailed

20262 Women's footwear, including dress & casual footwear Detailed

20263 Children's footwear, incl boys', girls', infants', & toddlers' Detailed

20265 Men's athletic footwear, incl sneakers & outdoor/hiking boots Detailed

20266 Women's athletic footwear, incl sneakers & outdoor/hiking boots Detailed

20267 Children's athletic footwear, incl sneakers & outdoor/hiking boots Detailed

20268 Footwear access, incl polishes, laces, trees, storage bags, etc Detailed

20269 All other footwear, including accessories Detailed

20270 Sewing, knitting materials & supplies, needlework goods, etc Broad

20271 Fabrics Detailed

20272 Patterns Detailed

20273 Sewing supplies, notions, yarns, laces, trimmings, etc Detailed

20280 Curtains, draperies, blinds, slipcovers, bed & table coverings Broad

20281 Curtains & draperies Detailed

20282 Vertical & horizontal blinds, woven wood blinds, & shades Detailed

20283 Furniture coverings, including ready-made & custom-made Detailed

20284 Domestics, incl towels, sheets, blankets, table linens, etc Detailed

20285 Furniture coverings & domestics Detailed

20300 Major household appliances Broad

20301 Kitchen appliances, parts, & accessories Detailed

20302 Laundry appliances, parts, & accessories Detailed

20303 Other major household appliances, parts, & accessories Detailed

20310 Small electric appliances & personal care appliances Broad

20320 TVs, video recorders, video cameras, video tapes, DVDs, etc Broad

20321 Televisions & related parts & accessories Detailed

20322 Video recorders, cameras & electronic game/DVD comb devices, 

etc Detailed

20323 DVDs and video tapes, prerecorded and/or recordable Detailed

20324 Video recorders, cameras, tapes & electr game/DVD comb dev Detailed

20330 Audio equip, musical instr, radios, stereos, CDs, records, etc Broad

20331 Audio equipment, components, parts & accessories Detailed

20335 Compact discs, records, tapes, & audio books Detailed

20337 Musical instruments, sheet music, & related items Detailed

20338 Audio content downloads Detailed

20340 Furniture, sleep equipment & outdoor/patio furniture Broad Yes

20341 Upholstered furniture Detailed Yes

20342 Sleep sofas, daybeds, futons, & other dual-purpose pieces Detailed Yes
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 A-11 

Table A-1: Retail Trade Sector Affected Product Line Key

Product 

Line Code Meaning of Products and services code Product Line Level

Composite Wood 

Product Line?

20343 Sleep equipment, incl mattresses, springs, cots, waterbeds, etc Detailed Yes

20344 Oth living room, dining room, bedroom furniture, incl headboards Detailed Yes

20345 All oth furniture, incl outdoor, office, computer-related, kitchen Detailed Yes

20346 Office furniture, including computer-related furniture Detailed Yes

20347 Outdoor/patio furniture Detailed Yes

20348 All other furniture, including kitchen, dinette, etc. Detailed Yes

20360 Flooring & floor coverings Broad Yes

20361 Soft-surface (textile) floor coverings & accessories Detailed

20363 Hardwood flooring Detailed Yes

20364 Other hard-surface floor coverings & accessories Detailed

20370 Computer hardware, software, & supplies Broad

20375 Computer & peripheral equipment Detailed

20376 Prepackaged computer software, including software downloads Detailed

20380 Kitchenware & home furnishings Broad Yes

20381 Cookware & cooking accessories Detailed

20382 Dinnerware, china, glassware, tableware, giftware Detailed

20383 Decorative accessories, incl lamps, lampshades, mirrors, etc Detailed Yes

20384 All other kitchenware & home furnishings Detailed

20385 All other kitchenware & home furnishings Detailed

20386 Giftware & glassware, including vases Detailed

20387 All other kitchenware & home furnishings Detailed

20388 China/glassware Detailed

20389 Flatware & holloware Detailed

20391 Clocks Detailed Yes

20392 All other kitchenware & home furnishings Detailed

20400 Jewelry, incl watches, watch attach, novelty jewelry, etc Broad

20401 Diamond jewelry Detailed

20402 Pearl jewelry Detailed

20403 Other gemstone jewelry Detailed

20404 Loose gemstones, including diamonds & colored gemstones Detailed

20405 Karat gold jewelry Detailed

20406 Watches Detailed

20407 Diamond, gemstone, & pearl jewelry Detailed

20408 Estate/antique jewelry Detailed

20411 All other jewelry Detailed

20412 Costume & novelty jewelry Detailed

20413 All other jewelry Detailed

20414 Platinum jewelry Detailed

20415 All other jewelry Detailed

20420 Books Broad

20440 Photographic equipment & supplies Broad

20460 Toys, hobby goods, & games Broad Yes

20461 Toys, including wheel goods Detailed Yes

20462 Games, including video & electronic games Detailed

20463 Hobby goods Detailed Yes

20490 Optical goods, incl eyeglasses, contact lenses, sunglasses, etc Broad

20500 Sporting goods Broad Yes

20501 Team sporting goods equip sold to teams, institutions, etc Detailed Yes

20502 Team sporting goods equipment sold to individuals Detailed Yes

20503 Tennis equipment Detailed

20504 Golf equipment Detailed

20505 Snow-skiing & snowboarding equipment Detailed Yes

20506 Exercise/fitness equipment Detailed

20507 Firearms, hunting equipment, & supplies Detailed Yes

20508 Fishing tackle, including bait Detailed

20509 Camping & backpacking equipment & supplies Detailed
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 A-12 

Table A-1: Retail Trade Sector Affected Product Line Key

Product 

Line Code Meaning of Products and services code Product Line Level

Composite Wood 

Product Line?

20511 Trophies & plaques Detailed

20512 Bicycles, parts & accessories Detailed

20513 Boats, canoes, kayaks, boat motors, parts & accessories Detailed

20514 New boats, motors, & parts & accessories Detailed

20515 Used boats, motors, & parts & accessories Detailed

20516 Scuba & skin diving equipment Detailed

20517 Water skiing, surfing, & sail boarding equipment Detailed

20518 Billiards equipment & supplies Detailed Yes

20519 Boats, motors, parts & accessories Detailed

20521 All other sporting goods Detailed Yes

20522 All other sporting goods Detailed Yes

20523 All other sporting goods Detailed Yes

20524 In-line roller skates & accessories Detailed

20525 All other sporting goods Detailed Yes

20526 All other sporting goods Detailed Yes

20527 Motorized sport vehicles, incl ATVs, snowmobiles, etc Detailed

20528 All other sporting goods Detailed Yes

20580 RVs, incl camping & travel trailers, campers, parts & accessories Broad Yes

20581 New camping trailers, including collapsible Detailed Yes

20582 New travel trailers, including 5th wheel Detailed Yes

20583 New truck campers for mounting on pick-up trucks Detailed Yes

20584 New motor homes Detailed Yes

20585 Used recreational vehicles Detailed

20586 All other recreational vehicles, parts, & accessories Detailed Yes

20600 Hardware, tools, & plumbing & electrical supplies Broad

20601 Hardware Detailed

20602 Tools & equipment Detailed

20603 Plumbing fixtures & supplies Detailed

20605 Wiring & wire products Detailed

20606 Welding supplies Detailed

20607 Electrical supplies Detailed

20620 Lawn, garden, & farm equipment & supplies Broad

20621 Cut flowers Detailed

20622 Cut flowers -- unarranged Detailed

20623 Cut flowers -- arranged Detailed

20624 Indoor potted plants -- blooming Detailed

20625 Indoor potted plants -- nonblooming Detailed

20626 Indoor potted plants & floral items Detailed

20627 Outdoor nursery stock Detailed

20628 Fertilizer, lime, chemicals, & other soil treatments Detailed

20631 Lawn & garden tools Detailed

20633 All other lawn, garden, & farm equip & supplies Detailed

20636 Lawn & garden machinery, equipment, & parts Detailed

20637 Farm machinery, equipment, & parts Detailed

20638 All other farm supplies, including grain & animal feed Detailed

20639 All other lawn & garden supplies Detailed

20640 Dimensional lumber & oth bldg/structural materials & supplies Broad Yes

20641 Dimensional lumber, nontreated Detailed

20642 Treated lumber Detailed

20643 Boards, all grades Detailed

20644 Gypsum, specialty boards, & treatments Detailed

20645 Engineered wood products, incl glue-lam, LVL, etc Detailed

20646 Structural panels, incl softwood plywood, & OSB Detailed

20647 Oth panel products, incl hardwood plywood, waferboard, etc Detailed Yes

20648 Bldg components, incl floor trusses, roof trusses, etc Detailed

20649 Connectors, including joist hangers, tie-downs, etc. Detailed
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 A-13 

Table A-1: Retail Trade Sector Affected Product Line Key

Product 

Line Code Meaning of Products and services code Product Line Level

Composite Wood 

Product Line?

20651 Steel studs Detailed

20652 Doors & moulding Detailed Yes

20653 Windows, skylights, & patio doors Detailed Yes

20654 Glass Detailed

20655 Masonry supplies, including cement, lime, plaster, brick, etc. Detailed

20656 Insulation (all types) & weatherization products Detailed

20657 Siding, exterior trim, & soffit Detailed

20658 Roofing (all types), including roofing supplies Detailed

20659 Ceilings & ceiling systems Detailed

20661 Kitchen & bath cabinets & countertops Detailed Yes

20662 Heating & HVAC units; ductwork; heating stoves Detailed

20665 Refrigeration equipment & supplies Detailed

20666 All other building/structural materials & supplies Detailed

20670 Paint & sundries Broad

20673 Interior paint Detailed

20674 Exterior paint Detailed

20675 Stain, varnish, shellac, & other coatings Detailed

20676 Painting equipment, including tools, brushes, scrapers, etc. Detailed

20677 Painting supplies Detailed

20680 Manufactured (mobile) homes, excluding modular homes Broad Yes

20681 New single-section manuf (mobile) homes, less than 14 ft wide Detailed Yes

20682 New single-section manuf (mobile) homes, 14 ft wide Detailed Yes

20683 New single-section manuf (mobile) homes, more than 14 ft wide Detailed Yes

20684 New multisection manuf (mobile) homes, two sections Detailed Yes

20685 New multisection manuf (mobile) homes, three or more sections Detailed Yes

20686 Other new manufactured (mobile) homes & parts & accessories Detailed Yes

20687 Used single-section manufactured (mobile) homes Detailed

20688 Used multisection manufactured (mobile) homes Detailed

20690 Wallpaper & other flexible wallcoverings Broad

20700 Cars, trucks, motorcycles & other powered transportation vehicles Broad

20712 New motorcycles, motor scooters, motor bikes, incl parts & access Detailed

20713 Used motorcycles, motor scooters, motor bikes, incl parts & access Detailed

20714 All other powered transportation vehicles Detailed

20720 Automotive fuels Broad

20730 Automotive lubricants, including oil, greases, etc Broad

20740 Automotive tires, tubes, batteries, parts, accessories Broad

20741 Automotive tires & tubes Detailed

20742 Auto parts (over-the-counter), accessories, & sundry supplies Detailed

20749 Automotive batteries Detailed

20780 Household fuels, including oil, LP gas, wood, coal Broad

20800 Pets, pet foods, & pet supplies Broad

20850 All other merchandise Broad

20851 Stationery products Detailed

20852 Office paper, incl computer, copier, fax & typewriter paper Detailed

20853 Office & school supplies Detailed

20854 Office equipment Detailed

20855 Greeting cards Detailed

20856 Magazines & newspapers Detailed

20859 Luggage & leather goods Detailed

20861 Antiques, items over 100 years old Detailed

20862 Collectibles, incl items which are old, but less than 100 yrs old Detailed

20863 Art goods, including original pictures & sculptures Detailed

20864 Utility trailers, including horse/livestock trailers Detailed

20865 Telephones, including cellular phones Detailed

20866 Ice Detailed

20867 Coins, medals, & other numismatic items Detailed
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 A-14 

Table A-1: Retail Trade Sector Affected Product Line Key

Product 

Line Code Meaning of Products and services code Product Line Level

Composite Wood 

Product Line?

20868 Stamps, autographs, & other philatelic materials & supplies Detailed

20869 Artists' materials & supplies Detailed

20871 Religious goods, except books Detailed

20873 Monuments & grave markers Detailed

20874 Fireworks Detailed

20876 Pools, pool chemicals, & pool supplies & accessories Detailed

20877 Souvenirs & novelty items Detailed

20878 Seasonal decorations Detailed

20879 Artificial/silk flowers, plants, & trees Detailed

20881 Craft supplies Detailed

20882 Typewriters Detailed

20883 All other merchandise Detailed

21100 Meals, snacks & nonalcoholic bvgs prepared for immediate cons Broad

21109 Soup and salad bars Detailed

21111 All other meals & snacks Detailed

21220 Meals, snacks & nonalcoholic bvgs prepared for catered event Broad

29810 All other merchandise Broad

29900 All nonmerchandise receipts Broad

29901 Construction receipts Detailed

29902 Repair & maintenance receipts Detailed

29903 Materials used in landscaping or lawn service Detailed

29904 Labor charges for work performed by this establishment Detailed

29905 Labor charges for work contracted out to other establishments Detailed

29906 Other labor charges Detailed

29907 Parts installed in repair Detailed

29908 Parts & materials used in furniture repair or upholstery work Detailed

29909 Delivery charges Detailed

29911 Delivery & installation charges Detailed

29912 Rental of video tapes, DVDs, video/DVD players, etc Detailed

29913 Receipts from coin-operated amusement machines Detailed

29914 Receipts from pleasure boat storage & docking services Detailed

29915 Receipts from instructions & lessons Detailed

29917 Receipts from photofinishing performed by this establishment Detailed

29918 Receipts from photofinishing contracted out to other estabs Detailed

29921 Rental or lease of boats, aircrafts, etc. Detailed

29922 Rental or lease of recreational vehicles Detailed

29924 Rental or lease of appliances, stereos, TVs, photo equip, etc Detailed

29927 Rental or lease of equipment Detailed

29929 Receipts from photocopying, faxing, & check cashing services Detailed

29932 Rental of space and/or mobile homes (residential) Detailed

29933 Rental of clothing, formal wear, etc. Detailed

29935 Carpet repair rcpts & oth labor charges - work perf by this estab Detailed

29936 Carpet cleaning receipts for work performed by this establishment Detailed

29938 Printing or engraving to order Detailed

29943 Value of service contracts Detailed

29944 Commissions rcvd for sale of credit life ins & arr of financing Detailed

29945 Wire services & commissions Detailed

29946 All other nonmerchandise receipts Detailed

29948 All other nonmerchandise receipts Detailed

29952 All other nonmerchandise receipts Detailed

29953 All other nonmerchandise receipts Detailed

29955 All other nonmerchandise receipts Detailed

29956 All other nonmerchandise receipts Detailed

29961 All other nonmerchandise receipts Detailed

29963 All other nonmerchandise receipts Detailed

29967 All other nonmerchandise receipts Detailed
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 A-15 

Table A-1: Retail Trade Sector Affected Product Line Key

Product 

Line Code Meaning of Products and services code Product Line Level

Composite Wood 

Product Line?

29968 All other nonmerchandise receipts Detailed

29969 All other nonmerchandise receipts Detailed

29972 All other nonmerchandise receipts Detailed

29975 All other nonmerchandise receipts Detailed

29976 All other nonmerchandise receipts Detailed

29977 All other nonmerchandise receipts Detailed

29979 All other nonmerchandise receipts Detailed

6220 
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 A-16 

Table A-2: Wholesale Trade Sector Affected Product Line Key

Product 

Line Code Meaning of Products and services code Product Line Level

Composite Wood 

Product Line?

10000 Industry total Total Yes

10100 New and used automobiles, motorcycles, and trailers Broad

10112 Used automobiles Detailed

10114 Motor scooters, mopeds, and golf carts Detailed

10130 Light trucks and truck bodies, 14,000 lb or less Broad

10132 Used light trucks Detailed

10140 Medium trucks, 14,001 lb to 33,000 lb Broad

10141 New medium trucks and tractors Detailed

10142 Used medium trucks and tractors Detailed

10150 Heavy trucks and tractors, over 33,000 lb Broad

10155 Used heavy trucks, tractors, and trailers Detailed

10200 New and rebuilt automotive parts and supplies Broad

10213 Electrical engine parts Detailed

10214 Brake parts Detailed

10215 Exhaust system parts Detailed

10217 Hoses, belts, gaskets, and wiper blades Detailed

10218 Filters, including oil, air, gas, and transmission Detailed

10219 Engine parts, excluding electrical parts Detailed

10221 Body parts and repair materials Detailed

10222 Suspension parts, including shocks, struts, and balljoints Detailed

10223 Other automotive parts and supplies Detailed

10224 Automotive accessories Detailed

10240 Used automotive parts, accessories, and equipment Broad

10300 Tires and tubes Broad

10311 New automobile tires and tubes Detailed

10312 Re-treaded and used tires and repair materials Detailed

10313 New truck and bus tires Detailed

10314 Re-treaded and used truck and bus tires and repair materials Detailed

10400 Household and lawn furniture Broad Yes

10411 Upholstered furniture Detailed Yes

10412 Mattresses and beds Detailed Yes

10413 Lawn and outdoor furniture Detailed

10414 Other furniture Detailed Yes

10415 Sleep sofas Detailed Yes

10420 Office and business furniture Broad Yes

10421 New wooden and metal office furniture Detailed Yes

10422 New store and restaurant furniture Detailed Yes

10423 New public furniture Detailed Yes

10424 Used office and business furniture Detailed

10500 Household china Broad

10520 Linens, domestics, curtains, and draperies Broad

10521 Bedspreads, blankets, and bedding Detailed

10522 Curtains and draperies Detailed

10523 Shades and blinds Detailed

10524 Towels and washcloths Detailed

10525 Other linens and domestics Detailed

10530 Flooring and floor coverings Broad Yes

10531 Rugs and carpeting Detailed

10532 Hardwood flooring Detailed Yes

10533 Other hard-surface floor coverings and accessories Detailed

10540 Miscellaneous home furnishings Broad Yes

10541 Metal flatware and kitchen utensils Detailed

10542 Mirrors, lamps, and picture frames Detailed Yes

10543 Other home furnishings Detailed

10600 Rough, dressed, and finished dimensional lumber Broad Yes

10611 Untreated lumber Detailed
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 A-17 

Table A-2: Wholesale Trade Sector Affected Product Line Key

Product 

Line Code Meaning of Products and services code Product Line Level

Composite Wood 

Product Line?

10612 Treated lumber Detailed

10613 Boards Detailed

10620 Plywood and millwork Broad Yes

10621 Softwood plywood and Oriented Strand Board (OSB) Detailed

10622 Other panel products Detailed Yes

10623 Gypsum, waterboard, and other specialty boards Detailed

10624 Wood millwork Detailed Yes

10625 Metal millwork Detailed

10626 Trusses, wood siding, and wood shingles Detailed

10700 Concrete, cement, sand, gravel, stone, brick, block, and tile Broad

10711 Ready-mixed or transit-mixed concrete Detailed

10712 Cement and lime Detailed

10713 Sand, gravel, and crushed stone Detailed

10714 Brick, block, tile, and clay or cement sewer pipe Detailed

10720 Nonwood roofing, nonwood siding, and insulation materials Broad

10721 Nonwood roofing Detailed

10722 Nonwood siding Detailed

10723 Insulation materials Detailed

10730 Flat glass and other construction glass Broad

10740 Other construction products and materials Broad Yes

10741 Rain-carrying equipment Detailed

10742 Prefabricated buildings and non-wood structural assemblies Detailed Yes

10743 Manufactured mobile homes Detailed Yes

10744 Other construction materials Detailed

10800 Photographic equipment and supplies Broad

10813 Photographic film Detailed

10815 Other photographic equipment and supplies Detailed

10900 Office equipment, excluding computers Broad

10920 New computer equipment Broad

10921 Computers Detailed

10922 Computer storage devices Detailed

10923 Computer printers Detailed

10924 Other computer peripheral equipment Detailed

10930 Used computer equipment Broad

10950 Packaged computer software Broad

10960 Restaurant and hotel equipment and supplies Broad

10970 Store machines and equipment Broad Yes

10971 Vending machines Detailed

10972 Other store machines and equipment Detailed

10973 Electric signs Detailed

10974 Scales, except laboratory scales Detailed

10975 Store fixtures and displays Detailed Yes

11000 Surgical, medical, and hospital supplies Broad

11011 Surgical and medical instruments and equipment Detailed

11012 Orthopedic and prosthetic appliances and supplies Detailed

11013 Other surgical, medical, and hospital supplies Detailed

11020 Dental equipment, instruments, and supplies Broad

11021 Dental equipment Detailed

11022 Dental instruments and supplies Detailed

11030 Optical and ophthalmic goods and supplies Broad

11031 Ophthalmic goods Detailed

11033 Optometric equipment and supplies Detailed

11034 Eyeglasses, contact lenses, and other optical goods Detailed

11040 Religious and school supplies Broad

11041 Religious supplies Detailed

11042 School supplies Detailed
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 A-18 

Table A-2: Wholesale Trade Sector Affected Product Line Key

Product 

Line Code Meaning of Products and services code Product Line Level

Composite Wood 

Product Line?

11050 Miscellaneous professional equipment and supplies Broad

11051 Architects' equipment and supplies Detailed

11052 Drafting instruments and supplies Detailed

11053 Engineers' equipment and supplies Detailed

11054 Laboratory equipment and supplies Detailed

11055 Scientific instruments Detailed

11056 Veterinarians' equipment and supplies Detailed

11057 Other professional equipment and supplies Detailed

11100 Semi-finished iron and steel products Broad

11111 Sheet bars and tin plate bars Detailed

11112 Wire rods Detailed

11113 Rough castings and foundry products Detailed

11114 Forgings Detailed

11116 Other semi-finished iron and steel products Detailed

11120 Flat iron and steel products Broad

11121 Plates Detailed

11122 Hot-rolled and cold-rolled strips Detailed

11123 Cold-rolled sheets Detailed

11124 Hot-rolled sheets Detailed

11126 Galvanized and coated sheets Detailed

11127 Tin plate and terneplate Detailed

11128 Fabricated and structural plate products Detailed

11129 Other flat iron and steel products Detailed

11140 Iron and steel wire and wire products Broad

11141 Wire, including plain, coated, barbed, and twisted Detailed

11142 Nails Detailed

11143 Wire rope, strand, strapping, and reinforcement mesh Detailed

11150 Iron and steel pipes and tubing Broad

11152 Tubing Detailed

11153 Standard steel pipes Detailed

11154 Other steel pipes Detailed

11160 Other iron and steel products Broad

11162 Hot-rolled bars and bar-size shapes Detailed

11163 Cold-finished bars and bar-size shapes Detailed

11164 Concrete reinforcement bars Detailed

11165 Structural shapes, excluding bar-size shapes Detailed

11167 Other finished products Detailed

11170 Alloy steel Broad

11171 Hot-rolled or cold-finished bars Detailed

11173 Pipes, tubing, and plates Detailed

11175 Other alloy steel Detailed

11180 Stainless steel Broad

11181 Plates Detailed

11182 Strips Detailed

11183 Sheets Detailed

11184 Bars and bar-size shapes Detailed

11185 Other stainless steel, including tubing Detailed

11200 Copper and brass Broad

11211 Structural copper wire mill products Detailed

11212 Flat products, including sheets, strips, and plates Detailed

11213 Tubular products Detailed

11214 Rods, nonelectrical wire, and extruded shapes Detailed

11220 Aluminum shapes and forms Broad

11221 Plates - .250 inch and over Detailed

11222 Sheets and coils - .006 to .249 inch Detailed

11223 Rolled or extruded rods Detailed
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 A-19 

Table A-2: Wholesale Trade Sector Affected Product Line Key

Product 

Line Code Meaning of Products and services code Product Line Level

Composite Wood 

Product Line?

11224 Pipes and tubing Detailed

11225 Foil - up to .005 inch Detailed

11230 Other nonferrous metals Broad

11320 Minerals and ores Broad

11400 Electrical apparatus and equipment Broad

11411 Power and distribution transformers Detailed

11412 Switchgear and switchboard apparatus Detailed

11413 Motors and generators Detailed

11414 Conduit, raceway, and fittings Detailed

11415 Electric light bulbs Detailed

11416 Interior wiring, excluding conduit Detailed

11417 Exterior wiring and cable, excluding conduit Detailed

11418 Lighting fixtures Detailed

11419 Industrial controls Detailed

11421 Other electrical apparatus and equipment Detailed

11500 Electric household appliances Broad

11511 Televisions Detailed

11512 Radios, stereos, tape players, and CD players Detailed

11513 VCRs, video cameras, digital video disc (DVD) players Detailed

11514 Electric household ranges and ovens Detailed

11515 Household refrigerators and freezers Detailed

11516 Electric household washing machines and dryers Detailed

11517 Household vacuum cleaners and sewing machines Detailed

11518 Other electric household appliances Detailed

11600 Electronic parts and equipment Broad

11612 Integrated circuits Detailed

11613 Capacitors and resistors Detailed

11615 Semiconductors Detailed

11616 Electronic connectors and other passive electronic parts Detailed

11618 Other electronic parts and equipment Detailed

11650 Communications equipment and supplies Broad

11651 Telephones Detailed

11652 Other communications equipment Detailed

11700 Hardware Broad

11711 Hand tools, including power driven tools Detailed

11712 Bolts, nuts, rivets, and other fasteners, excluding nails Detailed

11713 Cutlery Detailed

11800 Plumbing and hydronic heating equipment Broad

11811 Plastic pipe fittings and valves, excluding pipes and tubing Detailed

11812 Metal pipe fittings and valves, excluding pipes and tubing Detailed

11813 Plumbing fixtures Detailed

11814 Hydronic and gas furnaces, stoves, water heaters Detailed

11815 Boilers, radiators, and convectors Detailed

11816 Well pumps and motors Detailed

11818 Other plumbing and heating equipment and supplies Detailed

11900 Forced air heating and air-conditioning equipment Broad

11911 Forced air furnaces Detailed

11912 Central air-conditioners Detailed

11914 Heat pumps Detailed

11916 Air cleaning and filtration systems Detailed

11917 Compressors for air-conditioners Detailed

11918 Condensing units for air-conditioners Detailed

11919 Registers, grills, duct insulation Detailed

12000 Refrigeration equipment and supplies Broad

12011 Commercial refrigerators Detailed

12012 Unit coolers for commercial refrigerators Detailed
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 A-20 

Table A-2: Wholesale Trade Sector Affected Product Line Key

Product 

Line Code Meaning of Products and services code Product Line Level

Composite Wood 

Product Line?

12013 Condensing units for commercial refrigerators Detailed

12014 Refrigerants Detailed

12015 Other commercial refrigeration equipment Detailed

12100 Construction and mining machinery Broad

12200 Farm machinery, equipment, and parts Broad

12215 New irrigation equipment Detailed

12216 Other new farm machinery and equipment Detailed

12220 Lawn and garden machinery, equipment, and parts Broad

12221 New power lawn mowers Detailed

12222 Other new lawn and garden machinery Detailed

12230 Food-processing machinery, equipment, and parts Broad

12231 New commercial food-processing machinery Detailed

12232 New packing, packaging, and bottling equipment Detailed

12233 Used commercial food-processing machinery Detailed

12234 Used packing, packaging, and bottling equipment Detailed

12300 Hydraulic and pneumatic pumps, motors, and parts Broad

12311 Pumps Detailed

12312 Motors Detailed

12313 Pump and motor parts Detailed

12320 General-purpose industrial machinery Broad

12321 New pumps, compressors, and equipment Detailed

12323 New diesel engines, excluding automotive engines Detailed

12326 New controlling, recording, and indicating instruments Detailed

12327 Other new general-purpose industrial machinery Detailed

12328 Used general-purpose industrial machinery Detailed

12330 Metalworking machinery, equipment, and parts Broad

12340 Materials handling machinery, equipment, and parts Broad

12341 New conveying equipment Detailed

12342 New hoists and cranes Detailed

12343 New forklifts Detailed

12344 New industrial trucks and tractors Detailed

12345 Used materials handling machinery Detailed

12350 Oil well, oil refinery, and pipeline machinery Broad

12351 New oil refining and pipeline machinery Detailed

12352 New oil field machinery, equipment, and supplies Detailed

12353 Used oil well, oil refinery, and pipeline machinery Detailed

12360 Other industrial machinery, equipment, and parts Broad

12361 New metal smelting and refining machinery Detailed

12362 New power plant machinery, excluding electrical Detailed

12363 New printing trades machinery Detailed

12364 New textile and sewing machinery and equipment Detailed

12365 New woodworking machinery Detailed

12366 Other new industrial machinery and equipment Detailed

12367 Used industrial machinery and equipment Detailed

12370 Mechanical power transmission supplies Broad

12371 Bearings and bushings Detailed

12372 Other mechanical power transmission supplies Detailed

12380 Industrial valves and fittings Broad

12390 Hydraulic and pneumatic valves Broad

12391 Hydraulic valves Detailed

12392 Pneumatic valves Detailed

12400 Hydraulic and pneumatic cylinders and rotary actuators Broad

12411 Hydraulic cylinders and rotary actuators Detailed

12412 Pneumatic cylinders and rotary actuators Detailed

12420 Hydraulic and pneumatic connectors and assemblies Broad

12421 Hydraulic and pneumatic connectors Detailed
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 A-21 

Table A-2: Wholesale Trade Sector Affected Product Line Key

Product 

Line Code Meaning of Products and services code Product Line Level

Composite Wood 

Product Line?

12422 Hydraulic and pneumatic assemblies Detailed

12430 Other hydraulic and pneumatic accessories and parts Broad

12440 Welding supplies, excluding gases Broad

12450 Industrial containers and supplies Broad

12451 New and reconditioned drums and barrels Detailed

12460 Abrasives, strapping, tape, and inks Broad

12466 Other industrial supplies Detailed

12500 Beauty and barber equipment and supplies Broad

12511 Beauty and barber equipment Detailed

12512 Beauty and barber supplies Detailed

12520 Janitorial equipment and supplies Broad

12521 Power janitorial equipment Detailed

12522 Nonpower janitorial equipment Detailed

12523 Janitorial supplies Detailed

12530 Laundry and dry-cleaning equipment and supplies Broad

12540 Service establishment equipment and supplies Broad Yes

12541 Burial caskets and other funeral equipment Detailed Yes

12542 Other service establishment equipment Detailed

12543 Upholsterers' equipment Detailed

12544 Shoe repair equipment Detailed

12600 Aircraft and aeronautical equipment Broad

12613 Other new aircraft equipment and supplies Detailed

12614 Used aircraft and aeronautical equipment Detailed

12620 Marine machinery, equipment, and supplies Broad

12630 Other transportation equipment and supplies Broad

12700 Sporting and recreational goods and supplies Broad Yes

12711 Firearms, ammunition, and reloading equipment Detailed Yes

12712 Bicycles and bicycle tires and tubes Detailed

12713 Billiards, pool, and bowling equipment Detailed Yes

12714 Camping and fishing equipment and accessories Detailed

12715 Athletic equipment and accessories Detailed

12716 Skiing and snowboarding equipment Detailed Yes

12717 Marine pleasure craft, equipment, and accessories Detailed

12718 Other sporting and recreational goods Detailed Yes

12800 Toys and hobby goods and supplies Broad Yes

12811 Video game players Detailed

12812 Other toys and games, including children's vehicles Detailed Yes

12813 Crafts and craft supplies Detailed Yes

12814 Other hobby goods and accessories Detailed Yes

12900 Ferrous metal scrap Broad

12920 Nonferrous metal scrap Broad

12930 Recyclable paper and paperboard Broad

12940 Recyclable materials Broad

12941 Recyclable textiles Detailed

12943 Recyclable plastics Detailed

12944 Recyclable glass Detailed

13000 Jewelry, diamonds, gemstones, and watches Broad

13016 Other jewelry, silverware, and plated ware Detailed

13030 Precious metals--gold, silver, and platinum Broad

13120 Nonlumber forest products Broad

13130 Prerecorded compact discs (CDs) Broad

13140 Prerecorded video tapes, and digital video discs (DVDs) Broad

13150 Miscellaneous durable goods Broad

13153 Works of art Detailed

13154 Other miscellaneous durable goods Detailed

13155 Signs, excluding electric signs Detailed
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 A-22 

Table A-2: Wholesale Trade Sector Affected Product Line Key

Product 

Line Code Meaning of Products and services code Product Line Level

Composite Wood 

Product Line?

13160 Fire extinguishers and fire safety equipment Broad

13170 Safety equipment Broad

13200 Printing and writing paper Broad

13211 Newsprint Detailed

13213 Other printing and writing paper Detailed

13300 Office paper, office supplies, greeting cards, and labels Broad

13312 Office and consumer paper, including stationery Detailed

13313 Inked ribbons, pens, and pencils Detailed

13314 Toner and toner cartridges Detailed

13316 Other office supplies Detailed

13400 Paper and plastic products Broad

13411 Cardboard boxes Detailed

13412 Paper dishes, cups, and napkins Detailed

13413 Industrial paper and plastic Detailed

13414 Disposable plastic boxes, containers, cups, dishes Detailed

13415 Other paper and plastic products Detailed

13500 Pharmaceuticals Broad

13512 Nonprescription drugs Detailed

13513 Cosmetics and beauty supplies Detailed

13516 Other toiletries and druggists' sundries Detailed

13517 Veterinarians' medicines Detailed

13600 Knit and woven piece goods Broad

13613 Synthetics, excluding synthetic knits Detailed

13700 Notions Broad

13800 Men's and boys' clothing Broad

13814 Men's and boys' work clothing and uniforms Detailed

13900 Women's, misses', and girls' clothing Broad

14000 Footwear Broad

14013 Women's, misses', and girls' footwear Detailed

14014 Men's and boys' footwear Detailed

14100 Packaged frozen food Broad

14112 Frozen fish and seafood products Detailed

14113 Frozen vegetables Detailed

14115 Frozen meat products Detailed

14117 Other frozen foods, excluding frozen dairy products Detailed

14200 Dairy products Broad

14212 Cheese Detailed

14214 Ice cream and other frozen dairy products Detailed

14217 Yogurt Detailed

14300 Poultry and poultry products Broad

14400 Confectioneries Broad

14415 Other confectioneries Detailed

14600 Fresh meat and meat products Broad

14611 Beef not slaughtered on location Detailed

14700 Fresh fruits and vegetables Broad

14800 Coffee, tea, and powdered drink mixes Broad

14811 Coffee Detailed

14812 Tea Detailed

14820 Bread, baked goods, and baking ingredients Broad

14830 Nonperishable (canned) food Broad

14831 Nonperishable (canned) fruits, vegetables, and juices Detailed

14839 Sauces, salad dressing, dips, and vinegar Detailed

14841 Condiments Detailed

14848 Other canned food, including canned poultry products Detailed

14850 Soft drinks and bottled water Broad

14851 Packaged soft drinks Detailed
*** EO 12866 Review Draft – Deliberative – Do Not Quote, Cite, or Release During Review***

May 1, 2013 A-23 

Table A-2: Wholesale Trade Sector Affected Product Line Key

Product 

Line Code Meaning of Products and services code Product Line Level

Composite Wood 

Product Line?

14852 Pre-mix and post-mix bulk soft drinks Detailed

14853 Bottled water Detailed

14855 Sport and energy drinks Detailed

14880 Grocery specialties Broad

14885 Pet food Detailed

15300 Plastics materials and basic shapes Broad Yes

15311 Plastic pipes, rods, tubes, and shapes Detailed

15312 High pressure laminates Detailed Yes

15313 Plastics raw materials Detailed

15314 Other plastics materials and basic shapes Detailed

15320 Industrial gases Broad

15330 Chemicals and allied products Broad

15335 Detergents and soaps Detailed

15342 Adhesives, sealants, and glues Detailed

15344 Other chemicals and allied products Detailed

15400 Refined petroleum products Broad

15420 Liquefied petroleum (LP) Broad

15800 Farm supplies Broad

15814 Herbicides, soil sterilizers, and soil conditioners Detailed

15815 Insecticides, fungicides, and pesticides Detailed

15816 Other agricultural chemicals and fertilizers Detailed

15817 Seeds and bulbs for planting Detailed

16000 Paint, paint supplies, wallpaper, and wallpaper supplies Broad

16011 Architectural coatings Detailed

16012 Industrial/Original Equipment Manufacturer (OEM) coatings Detailed

16013 Special-purpose coatings Detailed

16014 Paint supplies Detailed

16015 Wallpaper and wallpaper supplies Detailed

16100 Books, periodicals, newspapers, and other printed materials Broad

16110 Flowers and florists' supplies Broad

16120 Art goods, including novelties and souvenirs Broad

16121 Art goods Detailed

16122 Novelties and souvenirs Detailed

16130 Textile bags, bagging, and burlap Broad

16150 Wigs, yarns, and leather products Broad

19700 Service receipts and labor charges Broad

19701 Labor charges for repair work Detailed

19702 Parts installed in repair work Detailed

19703 Other service receipts and labor charges Detailed

19720 Receipts for service contracts Broad

19730 Advertising specialties, including paper novelties Broad

19740 Receipts for installing equipment Broad

19810 Miscellaneous commodities Broad

19930 Sales of integrated systems Broad

19940 Rental and operating lease receipts Broad

19944 Other rental receipts Detailed

19950 Construction receipts Broad

19960 Custom computer software Broad

19970 Receipts for printing or photocopying Broad

19980 Receipts for machine shop job work Broad

6221