Office of Infrastructure Protection

National Protection and Programs Directorate

U.S. Department of Homeland Security 

Washington, DC 20528

CHEMICAL FACILITY ANTI-TERRORISM STANDARDS

ADVANCE NOTICE OF PROPOSED RULEMAKING

LISTENING SESSION HELD IN CHICAGO, IL ON

OCTOBER 2, 2014

CONTENTS:

Agenda

Transcript
Chemical Facility Anti-Terrorism Standards

Advance Notice of Proposed Rulemaking (CFATS ANPRM)

October 2, 2014 Listening Session 

Hosted by the Department of Homeland Security (DHS) – 536 Federal Building, 101 West Congress Parkway, Chicago, IL 60605

Agenda

8:00 a.m. – 9:00 a.m. Registration

9:00 a.m. – 9:20 a.m. Welcome, Introductions, and Overview

Kate Finnerty, Facilitator

Keith Nix, Department of Homeland Security, Office of Infrastructure Protection

David Schmidt, Department of Homeland Security, Office of Infrastructure Protection

9:20 a.m. – 9:30 a.m. Listening Session Format

Kate Finnerty, Facilitator

9:30 a.m. – 11:00 a.m. Public Listening Session

Comments from Listening Session Participants

11:00 a.m. – 11:15 a.m. BREAK

11:15 a.m. – 12:15 p.m. Public Listening Session

Comments from Listening Session Participants

12:15 p.m. – 12:45 p.m. Open Session (as time permits)

12:45 p.m. – 1:00 p.m. Closing Comments

1:00 p.m. Adjournment

Persons may also submit written comments to U.S. Department of Homeland Security, National Protection and Programs Directorate, 

Office of Infrastructure Protection, Infrastructure Security Compliance Division, 245 Murray Lane, Mail Stop 0610, Arlington, VA 20528-0610 

or through the Federal eRulemaking Portal at http://www.regulations.gov.

For more information on the CFATS ANPRM, please visit https://www.dhs.gov/CFATS-Rulemaking.
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UNITED STATES OF AMERICA

+ + + + +

DEPARTMENT OF HOMELAND SECURITY

+ + + + +

Regarding the matter of:

Public Listening Session

THURSDAY

OCTOBER 2, 2014

+ + + + +

U.S. CITIZENSHIP AND

IMMIGRATION SERVICES OFFICES

101 WEST CONGRESS PARKWAY

3RD FLOOR AUDITORIUM

CHICAGO, ILLINOIS 60605

+ + + + +

The above-entitled matter commenced 

pursuant to Notice before Kate Finnerty, 

facilitator.

PRESENT:

For the Department of Homeland Security:

Keith Nix, Deputy Branch Chief

Dave Schmidt, Chemical Facility Inspector

Kate Finnerty, Facilitator

Mary Blackmoor, Program Analyst

Sabrina Smith, Section Chief

Mitch Paine, Chemical Facility Inspector

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1 P R O C E E D I N G S

2 (9:00 a.m.)

3 MS. FINNERTY: Good morning, 

4 everybody, and welcome to the listening session 

5 for the Chemical Facility Anti-Terrorism 

6 Standards, Advance Notice of Proposed 

7 Rulemaking, or CFATS ANPRM, that was issued by 

8 the U.S. Department of Homeland Security on 

9 August 18th, 2014. We're glad that you are 

10 able to join us this morning.

11 This is the seventh listening 

12 session in a series that is held across the 

13 country, including six in person and two via 

14 webinar. My name is Kate Finnerty with 

15 Energetics Incorporated. DHS is leading the 

16 Advance Notice of Proposed Rulemaking effort 

17 and has asked me to be your moderator today.

18 Before we get started I would like 

19 to make a couple of announcements. All 

20 stakeholders are welcome to submit comments on 

21 the CFATS ANPRM, besides commenting in person 

22 at a listening session. There are two other 

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1 ways to submit written comments. They are both 

2 listed on the agenda that was handed out at 

3 registration and they are also listed in the 

4 Federal Register notice. They are the Federal 

5 e-rulemaking portal at www.regulations.gov and 

6 there's also a physical mailing address should 

7 you not have internet access.

8 The deadline to submit comments is 

9 October 17th, 2014, which is 60 calendar days 

10 after publication of the ANPRM in the Federal 

11 Register. All comments provided during this 

12 session today are being transcribed for 

13 note-taking purposes. A transcript of each 

14 listening session will be posted on a docket in 

15 the Federal Register at a later date. As such, 

16 for those making public comments today, please 

17 use the available microphones.

18 In case of an emergency, please exit 

19 out to your left here, back past registration 

20 down into the atrium. The guards will show you 

21 out through the lobby. The restrooms are 

22 located, again, to your left here just past the 

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1 elevators. The registration desk has an 

2 access key.

3 As a courtesy to all those 

4 participating, please put your phones on silent 

5 today. Thank you.

6 The purpose of today's session is to 

7 gather public comments, data, or views on how 

8 the current CFATS Regulation 6 CFR Part 27, 

9 issued in 2007, might be modified. Issuing the 

10 Advance Notice of Proposed Rulemaking enables 

11 the Department to provide stakeholders with an 

12 opportunity to submit public comments and 

13 suggestions for identifying ways to make the 

14 program more effective in achieving its 

15 regulatory objectives.

16 We are going to begin with opening 

17 remarks this morning, which will include a 

18 brief overview on the status of the CFATS 

19 program. The remainder of the session is 

20 dedicated to hearing from you.

21 At this time, I would like to 

22 introduce our first speaker, Mr. Keith Nix, 

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1 Deputy Branch Chief in the Field Operations 

2 Branch with the U.S. Department of Homeland 

3 Security, Infrastructure Security Compliance 

4 Division, or ISCD. Mr. Nix?

5 MR. NIX: Thank you. Can you hear 

6 through this mic here or do I need to, okay. I 

7 also feel it's low enough to turn the mic on.

8 The CFATS is helping to reduce the 

9 number of chemical facilities that are 

10 considered high risk. The Homeland faces a 

11 persistent and evolving threat from terrorist 

12 groups themselves. Chemical facilities 

13 potentially are attractive targets as a 

14 successful attack on some chemical facilities 

15 could potentially cause a significant number of 

16 deaths or injuries. Certain chemical 

17 facilities possess materials that could be 

18 stolen or diverted and used as or converted into 

19 weapons and used offsite.

20 In Section 550 of the Department of 

21 Homeland Security Appropriations Act of 2007, 

22 Congress authorized the Department to regulate 

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1 security at high-risk chemical facilities. 

2 Under Section 550, covered facilities must 

3 perform Security Vulnerability Assessments and 

4 implement Site Security Plans containing 

5 security measures that meet DHS defined 

6 Risk-Based Performance Standards or RBPSs. 

7 The Department developed the Chemical Facility 

8 Anti-Terrorism Standards, or CFATS, 6 CFR Part 

9 27 to implement this authority.

10 To determine if a facility is 

11 subject to CFATS, DHS looked at the unique 

12 circumstances faced by the facility starting 

13 with the quantity of the chemicals of interest 

14 the facilities possess. Potential regulation 

15 is not based on the facility type, meaning there 

16 are many different types of facilities that may 

17 be subject to CFATS, including chemical 

18 manufacturers, warehouse and distributors, 

19 chemical re-packing operations, oil and gas 

20 operations, hospitals, semi-conductor 

21 manufacturers, paint manufacturers, colleges 

22 and universities, and mining facilities.

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1 Congress did exempt several types 

2 of facilities from the regulation. Facilities 

3 that are regulated under the Maritime 

4 Transportation Security Act, or MTSA; 

5 facilities subject to regulations by the 

6 Nuclear Regulatory Commission, the NRC; 

7 facilities owned or operated by the Department 

8 of Defense or Energy; public water systems and 

9 water treatment works regulated under current 

10 Federal water quality laws administered by the 

11 U.S. Environmental Protection Agency.

12 Since the program's inception more 

13 than 3,000 facilities have voluntarily removed 

14 or reduced the onsite quantities of chemicals 

15 of interest, or modified processes to the point 

16 that they are no longer considered high risk. 

17 These actions have helped reduce the number of 

18 high-risk chemical facilities throughout the 

19 Nation and have correspondently made the Nation 

20 more secure.

21 As of September, well, as of

22 September 29th, 2014, CFATS covers 3,701 

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1 facilities, of them 3,075 are final tiered, 626 

2 preliminary tiered facilities across all 50 

3 states. DHS has received, and in the process 

4 of reviewing an estimated 4,600 Site Security 

5 Plans and Alternative Security Programs. Of 

6 these, 2,185 Site Security Plans have been 

7 authorized and close to 1,200 have been 

8 approved, that's as of, I think, yesterday.

9 The first Authorization Inspection 

10 was conducted during the summer of 2010 and as 

11 of September 29th, 2014, 1,576 Authorization 

12 Inspections had been conducted.

13 Strengthening the CFATS program -

14 the Infrastructure Security Compliance 

15 Division is working to continuously strengthen 

16 the program and improve implementation of 

17 CFATS.

18 Although work remains to be done, in 

19 the past year significant progress has been 

20 made. This includes improving the Site 

21 Security Plan review process and increasing the 

22 pace of Site Security Plan reviews and 

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1 approvals, engagement with industry on their 

2 development of Alternative Security Program 

3 templates, working with experts to evaluate and 

4 validate or recommend ways to improve the CFATS 

5 risk-tiering methodology, introducing 

6 game-changing initiatives such as one-day 

7 inspections with smaller inspection teams, 

8 corporate approach for companies with multiple 

9 facilities, and increase pre-inspection 

10 coordination and outreach.

11 Alternative Security Programs are 

12 one path to compliance. The Infrastructure 

13 Security Compliance Division is also exploring 

14 with industry the possibility of creating 

15 segment specific Alternative Security Programs 

16 that include options for best practices that 

17 may apply to certain types of facilities. We 

18 have met with various industry associations, 

19 such as the National Association of Chemical 

20 Distributors on this topic and continue to look 

21 for new opportunities for engagement.

22 The work industry has done with the 

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1 Department to develop Alternative Security 

2 Programs templates is a prime example of how an 

3 agency implementing a regulatory program like 

4 CFATS can work with industry to develop the 

5 tools and answer regulatory needs while also 

6 accounting for industry realities and how 

7 industry associations can support the 

8 Department of Homeland Security's mission.

9 Permanent authorization - the 

10 Department supports a permanent authorization 

11 for CFATS, for the CFATS program and is 

12 committed to working with Congress and other 

13 security partners to establish a permanent 

14 authority for the CFATS program.

15 DHS firmly believes permanent 

16 authorization will provide industry with the 

17 necessary stability to move forward in 

18 effectively implementing CFATS and will send a 

19 clear message to facilities that may be seeking 

20 to avoid their obligation to report dangerous 

21 chemicals - that the CFATS program is here to 

22 stay.

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1 HR 4007, the CFATS Authorization 

2 and Accountability Act of 2014, was passed in 

3 the U.S. House of Representatives on July 8th, 

4 2014. The bill would permanently authorize 

5 the CFATS program and authorize appropriations 

6 for three fiscal years.

7 The Senate Committee on Homeland 

8 Security and Governmental Affairs passed a 

9 Senate version of the bill, Protecting and 

10 Securing Chemical Facilities from Terrorist 

11 Attacks Act of 2014, on July 30th, 2014.

12 We are grateful that Congress has 

13 recognized the progress that the program has 

14 made and the importance of permanently 

15 authorizing this program.

16 Executive Order - in August 2013 

17 President Obama issued Executive Order 13650, 

18 Improving Chemical Facility Safety and 

19 Security, to improve the safety and security of 

20 chemical facilities and reduce risk to workers, 

21 communities, and first responders.

22 The tri-chairs of the Chemical 

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1 Facilities Safety and Security working group is 

2 the Department of Homeland Security, 

3 Department of Labor, and the EPA, was 

4 established by the Executive Order, submitted 

5 a status report to the President, AActions to 

6 Improve Chemical Facility Safety and Security 

7 - A Shared Commitment,@ which was released on 

8 June 6th, 2014.

9 Recognizing that information, 

10 actions, and experiences of stakeholders are 

11 essential to understanding, managing, and 

12 mitigating the risk of potential chemical 

13 facility hazards, the working group initiated 

14 a robust stakeholder outreach effort to assist 

15 them in identifying success and best practices.

16 This opportunity included 

17 engagement across all levels of government with 

18 owners and operators, industry associations, 

19 labor organizations, and communities affected 

20 by chemical plant disasters.

21 The status report highlights 

22 activities already undertaken to improve 

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1 chemical facility safety and security and 

2 provide a plan for moving forward to continue 

3 the initial progress made across the five 

4 areas. The status report includes an 

5 aggressive action plan to further minimize risk 

6 and continue to change the national landscape 

7 of chemical facility safety and security.

8 This action plan lays out 25 

9 priority actions in 5 areas that include: 

10 strengthening community planning and 

11 preparedness, enhancing federal operational 

12 coordination, improving data management, 

13 modernizing policies and regulations, and 

14 incorporating stakeholder feedback in 

15 developing best practices.

16 This status report is a milestone, 

17 not an endpoint. The most important lesson 

18 learned from this event is that every 

19 stakeholder group in the chemical facility 

20 community has a role to ensuring safe and secure 

21 operations.

22 Safety and security are a shared 

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1 commitment. DHS and our inter-agency 

2 colleagues are striving to improve safety and 

3 security of chemical facilities with our 

4 partners on behalf of the American public. DHS 

5 and our partners are making progress on the 

6 action items. One of those items includes the 

7 issuing of an Advance Notice of Proposed 

8 Rulemaking for the CFATS program.

9 As we work to mature CFATS, the 

10 CFATS regulatory program, DHS is initiating 

11 this rulemaking process to help identify how to 

12 make the CFATS program more effective in 

13 achieving its regulatory objectives. DHS 

14 believes that after seven years of experience 

15 implementing the CFATS program, both the 

16 Department and the regulating community, have 

17 gained first-hand insight into how a 

18 non-prescriptive security regulation could be 

19 most effective.

20 This ANPRM will provide an 

21 opportunity for the Department to hear and 

22 consider the views of the regulated industry 

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1 and other interested members of the public on 

2 their recommendations for program 

3 modification. DHS invites interested persons 

4 to submit written documents, data, or views on 

5 how the current CFATS regulation, 6 CFR Part 27, 

6 might be improved.

7 The public is encouraged to comment 

8 on all aspects of the program. This rulemaking 

9 covers all regulatory and guidance documents 

10 including Appendix A and the list of chemicals 

11 of interest covered by the program.

12 DHS has highlighted several topics 

13 on which public comment would be particularly 

14 helpful, including general regulatory 

15 approach, treatment of non-traditional 

16 chemical facilities, clarification of 

17 terminology, the Risk-Based Performance 

18 Standards, Appendix A, considerations for 

19 small business, and alignment with other 

20 regulatory programs.

21 Written comment may be submitted 

22 online through the Federal e-rulemaking portal 

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1 at www.regulations.gov or by mail to the U.S. 

2 Department of Homeland Security, National 

3 Protection and Programs Directorate, Office of 

4 Infrastructure Protection, Infrastructure 

5 Security Compliance Division, 245 Murray Lane, 

6 Mail Stop 0610, Arlington, Virginia 

7 20528-0610. Please note that any personal 

8 information included in submissions will be 

9 publicly viewable.

10 Thank you for taking the time to be 

11 here today. We look forward to hearing your 

12 comments and suggestions on how DHS can mature 

13 the CFATS program.

14 MS. FINNERTY: Thank you, Mr. Nix. 

15 We are also joined today by two DHS chemical 

16 facility inspectors, Mr. David Schmidt, who's 

17 here on our panel, and Mr. Mitch Paine. Thank 

18 you all for joining us.

19 The remainder of the session today 

20 is set aside to hear from you, the stakeholders. 

21 But before we hear from you, I'd like to outline 

22 the format and the ground rules for the session.

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1 This is a listening session with the 

2 purpose to hear a diverse set of opinions from 

3 across the broad spectrum of stakeholders who 

4 have an interest in improving and streamlining 

5 the CFATS rule. We hope to hear a range of 

6 suggestions and all viewpoints are welcome. 

7 As such, we are not seeking a discussion or 

8 consensus today on any of the topics.

9 DHS is interested in comments on the 

10 topics described in Part 4 of the ANPRM, as 

11 listed by Mr. Nix a few minutes ago. All 

12 presenters are asked to keep their comments 

13 directly related to the topics contained in the 

14 rule.

15 In a few minutes I will open the 

16 floor for public comments. Individuals will

17 have a maximum of five minutes to present to the 

18 panel, which does include any introduction to 

19 your remarks. Members of the panel may then 

20 ask clarifying questions. To help with 

21 timekeeping, I will show a yellow card when you 

22 have one minute remaining and a red card when 

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1 your time is up. We do ask that you respect 

2 everyone's time today and stay within the 

3 designated time frames.

4 If there are no questions on the 

5 process, let's go ahead and begin. I will now 

6 open the floor for public comments related to 

7 the CFATS Advance Notice of Proposed 

8 Rulemaking. Those interested in providing 

9 public comments today, if you would please make 

10 your way towards the microphone located in the 

11 middle of the room.

12 MR. FANSHER: Hi, my name is John 

13 Fansher. I'm with MGO Supply Company. We're 

14 propane, liquid petroleum, and gas 

15 distributors. We handle primarily propane and 

16 butane. I hadn't really intended to get up and 

17 speak but since there's a handful of us I 

18 thought why not.

19 Okay, really just a couple of 

20 comments. And one is, you know, I operate 23 

21 of these facilities across the country. I have 

22 one that if I were to rate what I perceive to 

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1 be the risk of these facilities, the one that 

2 turned out to be a high-risk facility, I would 

3 rate it about number 20. So, it would be 

4 helpful, as an operator, to understand a little 

5 more of the criteria that puts you as a 

6 high-risk facility.

7 And, you know, better understand if 

8 I don't think that the judgment is correct, how 

9 I go about trying to have that re-evaluated or 

10 just to make sure that there wasn't an error of 

11 some sort.

12 I did, early on, have a consultant 

13 contact DHS and try to determine, you know, why 

14 this particular facility ended up a high risk. 

15 And, he kind of came back and said, well, 

16 there's a whole number of variety of reasons 

17 that it could have and it could be a combination 

18 of these. And so I never did really figure out 

19 why this particular facility tiers out the way 

20 it does.

21 Beyond just trying to get my hands 

22 around that and figure out, you know, what, if 

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1 anything, I can do to maybe get this dropped to 

2 a lower level, you know, we continue to build 

3 and acquire these facilities. And if I had 

4 some better understanding of how to avoid 

5 getting in a high risk, or what standards, what 

6 it is you're looking for that makes you say, 

7 okay, it's not a risk, I can maybe build that 

8 or design that into the facilities that we, you 

9 know, that we build going forward. Or, if it 

10 has to do with logistics, you know, maybe we 

11 could stay away from certain types of pieces of 

12 property or land or whatever it is.

13 But, not knowing the criteria and 

14 understanding exactly, you know, how that's 

15 determined, I can't be proactive in the 

16 process. Thank you.

17 MS. FINNERTY: Thank you, sir. Do 

18 we have any comments or questions from the 

19 panel?

20 MR. SCHMIDT: No.

21 MS. FINNERTY: Thank you. Are any 

22 other members of the public here today that 

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1 would like to submit public comments? I will 

2 keep the floor open for public comments until 

3 12:45 p.m. and I will place all microphones on 

4 mute to reduce background noise. I will return 

5 to the podium should additional members of the 

6 public join us today and indicate that they 

7 would like to provide public comments.

8 In the meantime, please feel free to 

9 move about the room and discuss these issues 

10 here today with your colleagues. Thank you.

11 (Off the record.)

12 MS. FINNERTY: Thank you for 

13 participating in today's listening session on 

14 the Chemical Facility Anti-terrorism Standards 

15 Advance Notice of Proposed Rulemaking. The 

16 open comment session is now closed. Please 

17 visit the docket to view the listening session 

18 notes and to submit additional comments.

19 Please visit the chemical security 

20 website to view the remaining schedule of 

21 listening sessions. We are now adjourned.

22 (Whereupon at 12:46 p.m. the 

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1 meeting was concluded.)

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