*** EO12866 Review Draft – Delibera tive Document – Do NOT Cite, Quote or Release During the Review ***

March 8, 2011 (RIN 2070-AJ57) 1 EO12866_Rin2070-AJ57_LRRP Clearance_FRM_Cost-BenefitsDiscussion_2011-04-08.docx

Discussion of Potential Costs and Benefits Associated with the Clearance and Clearance

Testing Requirements for the Renovation, Re pair, and Painting Program Final Rule [RIN 2070-AJ57]

On May 6, 2010, EPA published a proposed rule entitled Lead; Clearance and Clearance Testing Requirements for the Lead , Renovation, Repair, and Painting Program (75 FR 25038). The proposal included a num ber of proposed revisions to the 2008 Lead Renovation, Repair, and Painting Program (RRP) ru le, which established accreditation, training, certification, and recordkeeping requirements as well as work practice standards for persons performing renovations for compensation in most pre-1978 housing and child-o ccupied facilities. Specifically, EPA proposed requirements for dust wi pe testing, clearance, allowing a certified renovator to collect a paint chip sample and send it to a recogni zed laboratory for analysis, minor changes to the training program accreditation app lication process, standards for e-learning in accredited training programs, minimum enforcement provisions for authorized state and tribal renovation programs, and minor revisions to th e training and certificat ion requirements for

renovators.

EPA has decided not to require dust wipe te sting and clearance as proposed. However, EPA is finalizing several of the other proposed revisions to the 2008 rule , including a provision allowing a certified renovator to collect a paint chip sample and send it to a recognized laboratory for analysis, minor changes to the tr aining program accreditation application process, standards for e-learning in acc redited training programs, minimum enforcement provisions for

authorized state and tribal renovation programs, and minor revisions to the training and certification requirements for renovators. EPA is also promulgating clarifications to the requirements for vertical containment on exterior renovation projects, the pr ohibited or restricted work practice provisions, and the requirements for high-efficiency particulate air (HEPA)

vacuums.

This document discusses the anticipated costs an d benefits associated with the final rule. In most cases, EPA is unable to quantify the increm ental costs or benefits that could be expected from each revision. Thus, this document contains a primarily qualitative assessment of the costs

and benefits attributable to the final rule. For the most part, EPA believes that the incremental

costs attributable to this final rule are minimal.

1. Clearance in lieu of cleaning verification . The final rule eliminates a provision that allows renovation firms to skip the cleaning veri fication part of the mand atory cleaning protocol if another Federal, State, or lo cal law or regulation, or the cont ract between the renovation firm and the property owner, require s the renovation firm to use qualif ied entities to perform dust wipe testing and requires the renovati on firm to achieve clearance.

Elimination of this provision could result in some minimal additional cost for renovations

that must achieve clearance. EPA’s “Elect rostatic Cloth and We t Cloth Field Study in Residential Housing” showed th at cleaning verification should ta ke approximately 5 minutes per cloth for each pass, and each cloth may be used for up to 40 square feet of uncarpeted floor, countertop, or windowsill space. EPA estimated, as part of the 2008 final RRP rule economic analysis, that the material cost for each dis posable cloth is $0.46 a nd that handles are $13.60*** EO12866 Review Draft – Delibera tive Document – Do NOT Cite, Quote or Release During the Review ***

March 8, 2011 (RIN 2070-AJ57) 2 apiece. EPA assumed that these handles can be used for approximately 1,000 events. Breaking down these costs on a square foot basis, EPA estimated that cleaning verification would cost $0.06 per square foot, using a mean loaded wage rate of $20.62. Thus, us ing the interior event sizes used in the 2008 RRP rule economic analys is, cleaning verification would cost from $2.88 for a small bathroom remodel involving 48 square feet of uncarpeted floor, countertop, or windowsill space, to $19.20 for a large window re placement project in multi-unit target housing (likely to be the largest project for which cl earance would be required by the Department of Housing and Urban Development (HUD) and for which EPA has estimated costs). EPA is unable to estimate how many renova tions covered by the RRP rule w ould also have to be cleared under another statute, regulat ion, or ordinance, or the renovation contract.

While elimination of this provision would a dd some costs to the re novations that could have qualified for this provision, EPA’s “Cha racterization of Dust Lead Levels After Renovation, Repair, And Painting Activ ities” demonstrates that the wet disposable cleaning cloth method is very effective at cleaning up dust. It is likely that completi ng the entire RRP cleaning protocol, including cleaning veri fication, will increase the probab ility that clearance, where required, will be achieved on the first attempt, thus eliminating the burden of additional clearance attempts.

2. Paint chip sampling option . EPA is finalizing the propo sed option allowing certified renovators to collect paint chip samples from painted components that will be disturbed by a renovation and submit those samples to an NLLAP-r ecognized entity for analysis. This revision is beneficial, in that it provides certified renov ators with another option for determining whether painted components contain lead-based paint. Th is revision adds no costs, because no certified renovators are required to use this option.

3. Additional materials required with training provider application. The final rule requires training providers to submit copies of the qualifications of th eir training manager and principal instructor along with their applic ations for accreditation. Training providers are already required to obtain and reta in these materials, the final rule merely requires them to be sent to EPA along with the application. EPA estim ates that these materials will consist of a 1- page resume and, possibly, a copy of a diploma, cour se completion certificate, or transcript. For a training provider with one trai ning manager and one principal instructor, this will mean an additional 2-4 photocopies. In the draft Info rmation Collection Request Supporting Statement accompanying the proposed rule, EPA estimated that each photocopy costs $0.09, for a total of $0.36 per accreditation or reaccredita tion application. An applicati on for reaccredit ation must be submitted every 4 years in order to maintain accreditation.

This amendment is beneficial because, when EPA reviews applications for accreditation, it is common for the Agency to request this doc umentation from training providers in order to verify that the training program manager a nd principal instructor(s) have the proper qualifications. Requesting this information takes time and can delay the review of an application. Having training providers submit this information upfront w ith the application will avoid such delays.

The final rule also requires training provide rs who use course materials approved by an authorized State or Tribal RRP program to subm it them to EPA along with their application. Previously, training providers w ho used EPA, State or Tribal course materials could merely*** EO12866 Review Draft – Delibera tive Document – Do NOT Cite, Quote or Release During the Review ***

March 8, 2011 (RIN 2070-AJ57) 3 certify that they were using such materials, a nd not submit them for review. However, given the diversity of the State and Tribal programs that EP A expects to authorize in the coming years, it could be very difficult for EPA to determine, wit hout reviewing the actual materials, whether the proposed course would be suitable for the Federal RRP program.

Submitting State or Tribal course materi als could involve a significant number of photocopies and additional maili ng costs. Using the example of the EPA model course materials, the instructor and student manuals for the renovator course consist of 434 and 312 pages respectively. Using EPA’s estimated co st per photocopy of $0.09, it would cost $67.14 to photocopy these two manuals. However, EPA does not know how many training providers

would want to use State or Tribal course materials rather than EPA’s model course materials. EPA has not received any applications for accr editation from renovation training providers who wish to use course materials from any of the 10 currently-authorized States. EPA believes that the most likely scenario would be a training prov ider who is accredited in an authorized State who would like to provide training in an adjacent non-authorized State.

4. Role of principal instructor. The final rule contains regul atory text intended to clarify the role of the principal instructor in providing training. The regulation, at 40 CFR 745.227(c)(3), previously stated that principal instructors are res ponsible for the organization of their courses and oversight of the teaching of all course material. The regulations also define “principal instructor” as “the individual who has the primary responsibility for organizing and teaching a particular course.” Nonetheless, the rule also allows training program managers to designate experts in a particular field ( e.g. , doctors or lawyers) as guest instructors, on an as needed basis, to teach discrete portions of the c ourse. EPA interprets these provisions to require a principal instructor to be present and primarily responsible for teaching the course, although guest instructors may be used to teach some porti on(s) of the course. Pr incipal instructors are also responsible for the qua lity of the instruction delivered by the guest instructors. To ensure that the regulation is clear on this point, EPA is amending the regulation to state that principal instructors are primarily responsible for teaching the course materials and must be present to provide instruction (or oversight of portions of the course taught by guest instructors) for the courses for which they have been designated the principal instructor. No costs are associated with this amendment, because it is merely a clarification of an existing EPA regulatory interpretation. The amendment is beneficial because it should reduce confusi on about the role of the principal instructor.

5. Amendments to accreditation applications. EPA has interpreted the training provider accreditation regulations to requir e accredited training providers to submit amended applications whenever there is a change to the information provided in the training provider’s most recent application for accreditation or re-accreditati on, including information regarding the training manager and any principal instructor(s) teachi ng courses offered by the training provider. However, the regulations have not previously specified a time limit for submitting such amendments. The final rule requires providers to submit amendments within 90 days of the date a change occurs to information in each provider’s most recent application. If a training provider does not do so, it must stop providing training un til the accreditation application is amended. This amendment is unlikely to add additional cost s, because EPA believes that training providers have generally been updating their information in a timely manner. EPA is also revising the regulation to specifically state that no fee will be charged for accreditation application

amendments.*** EO12866 Review Draft – Delibera tive Document – Do NOT Cite, Quote or Release During the Review ***

March 8, 2011 (RIN 2070-AJ57) 4 The final rule also gives EPA a 30-day pe riod to approve or disapprove amendments involving a new training manager, any new or additional principal instructors, or any new permanent training location. A training provide r may not offer training under a new training manager or a new principal instructor, or training at a new permanent training location until 30 days after the date that EPA receives an am ended accreditation application. This 30-day time period will give EPA sufficient time to check th e qualifications of the training manager(s) or principal instructor(s) before the training manage r begins managing or th e principal instructor begins teaching a course. This 30-day time period also gives EPA sufficient time to verify the suitability of a new permanent training locati on by visiting the locati on. While this specific revision may add some burden for training providers , EPA believes that most training providers plan far enough ahead so that the 30-day peri od will not delay training course delivery.

6. Hands-on training topics. 40 CFR 745.225 includes requirements and procedures that training programs must follow to become accredited in order to provide instruction in lead-based paint courses. Minimum requirements for training curricula are found in th is section, which lists course topics that must be included in the di fferent training courses w ith an indication of the topics that require hands-on in struction. However, EPA inadve rtently omitted indicating which course topics required hands-on training fo r the renovator and dust sampling technician disciplines. Accordingly, the final rule identif ies the topics for which hands-on training is required in renovator and dust sampling technician courses. EPA believes that this amendment adds no costs, because the EPA model courses incl ude hands-on training in these topics and most training providers are using the EPA model cour ses to deliver training. However, EPA has received some questions on this issue, so this revision should reduce po tential confusion about which topics must be covere d in the hands-on training.

The final rule also adds a sentence to 40 CFR 745.225(e)(2) st ating that refresher courses for all disciplines except project designer must in clude a hands-on component. This does not add any costs, because it is a restatement of EPA policy.

7. Minimum e-learning course re quirements and recordkeeping. The final rule adds minimum requirements for e-learning courses and associated recordkeeping. These requirements

include:

 A unique identifier for each student

 Tracking each student’s cour se log-ins, launches, progress, and completion, and maintaining these records

 At least 16 periodic knowledge checks pe r course, which must be successfully completed before the student can continue through the course.

 A test of at least 20 questions at the e nd of the electronic learning portion of the course, of which 80% must be answered correctly by the student for successful completion of the electronic le arning portion of the course.

 An electronic learning course completion cert ificate which can be saved or printed by the student, but which cannot be immediat ely and easily edited by the student.

While the final rule imposes additional s ubstantive requirements and recordkeeping on training providers who wish to pr ovide e-learning courses, e-lear ning is optional and not required*** EO12866 Review Draft – Delibera tive Document – Do NOT Cite, Quote or Release During the Review ***

March 8, 2011 (RIN 2070-AJ57) 5 for any training provider. In addition, EPA be lieves that the recordkeeping requirements for elearning courses are comparable to, and no more burdensome than, the ordinary recordkeeping already required for courses provided in traditiona l formats. This revision is beneficial because it enumerates the important elements of e-learni ng that EPA is already using as it evaluates applications for e-learning course accreditation.

8. Recordkeeping periods for re novation training providers. The final rule requires providers of renovator and dust sampling technician courses to keep student training records for 5 years. Previously, training pr oviders were required to keep training records for 3 years and 6 months. This length of time was chosen because of the length of indivi dual certification periods for lead-based paint activities, which can be as long as 3 years and 6 months including interim certification. However, the renovator and dust sampling technician certif ication periods are 5 years, with no interim certification. In order to ensure that the tr aining records from the previous training course are available for certified renovators and dust sampling technicians taking refresher courses, EPA is increasing the gene ral recordkeeping period applicable to these disciplines to 5 years. In addition, because EP A has already extended the certification period for any certified renovator who was trained before April 22, 2010 to July 1, 2015, EPA is requiring training records from those courses to be kept until July 1, 2015 as well. This revision is beneficial, in that it ensures th at training records from the prev ious course would always be available for renovators and dust sampling tech nicians taking refres her courses.

EPA can estimate the increased cost attri butable to this revision. EPA’s economic analysis for the 2008 RRP rule estimated that a total of 170 training pr oviders would become accredited for renovator training, and 56 renovator courses per training provider would be

needed to train the renovators re quired for the first year that the RRP rule was effective. EPA’s economic analysis for the Opt-Ou t and Recordkeeping Final Rule estimated that no new training providers would become accredited, and a total of 30 additional renovator courses per existing training provider would be needed to train the ad ditional renovators required during the first year after the Opt-Out Rule took effect . According to these analyses, a total of 20 renovator courses would be needed per training provi der during subsequent years. These analyses also estimated that 1 page of records would be kept for each notification provided, including pre-course notifications, re-notificat ions, and post-course no tifications. Each cour se would require a prenotification before the course be gan, giving general information on the training provider and the time and place for the course, and a post-notific ation after the course , which would include general information on the provider and info rmation on successful trainees and their photographs. EPA estimated that 12 percent of courses would also require a re- notification due to changes in date, time, or location. Thus, dur ing the first year, 86 courses would have been provided by each training provider, resulting in 182 notifications that would have to be kept for an additional 2 years, approximately, dependi ng upon when the course was actually given. Additional years would add 20 courses per year per training provider, resulting in 42 notifications that would have to be kept for an additional 18 months. In its economic analysis for the Opt-Out Rule, EPA estimated the recordk eeping costs per notific ation would total $0.24. Pro-rating this amount for 5 years results in an estimated recordkeeping cost of $0.34 per notification. Thus, recordkeeping costs for the 86 courses given pe r training provider in the first year would total $61.88 instead of $43.68. The reco rdkeeping costs for the 20 courses given per training provider in subsequent years would total $6.80 instead of $4.80. These estimates cover the entire 5 year period duri ng which the records would have to be kept.*** EO12866 Review Draft – Delibera tive Document – Do NOT Cite, Quote or Release During the Review ***

March 8, 2011 (RIN 2070-AJ57) 6 9. Trainee photographs. The final rule also includes certain minimum standards for the trainee photographs that must appear on re novator and dust sampling technician course completion certificates. Accredit ed training programs are require d to issue a course completion certificate for each person who passes a training cour se. A variety of information is required to

be on the certificate incl uding the name of the course, the name and address of the student, and contact information for the training program. Course certificates for renova tors or dust sampling technicians must include a photogr aph of the student, but the re gulation does not include size requirements or other specifications for the photograph. Since publishing the RRP rule, the Agency has been asked if there is a minimu m size for the photograph. EPA believes that it

would be beneficial to have mi nimum standards for the photograph in order to ensure that the person in the photograph is recogn izable. Therefore, the final rule requires the photographs on course completion certificates to be an accurate and recognizable image of the trainee and at least one square inch in size. This revision is not likely to add any costs, because EPA believes that training providers are alrea dy complying with these standards. The revision is beneficial because it should reduce potential confusion over the standards for trainee photographs.

10. State and Tribal programs. The final rule establishes certain minimum standards for authorized State and Tribal lead-based paint en forcement programs. These standards include a minimum penalty authority of $5,000 per violation pe r day, a requirement that the State or Tribe be able to sue to obtain penalties, and a require ment that the burden of proof and degree of knowledge or intent of the respondent be no gr eater than it is for EPA under the Toxic Substances Control Act (TSCA). The final rule also includes se veral clarifications on required

elements of authorized State and Tribal renov ation programs, such as requirements for dust sampling technician training and on- the-job training. These revisions are beneficial because they ensure that State and Tribal programs have adequate enforcement mechanisms and reduce potential confusion about what such programs must include. Th ese revisions impose no costs, because States and Tribes are not required to develop renovation and other lead-based paint programs, nor are they required to obtain EP A authorization for these programs. EPA will continue to implement the lead-based pain t programs, including renovation programs, in

unauthorized States and Trib al areas.

11. Vertical containment. The final rule includes several provisions designed to clarify

when vertical containment must be used and en sure that renovation firm s consider all of the appropriate factors when designing containment systems for exterior projects. Specifically, the final rule requires vertical c ontainment to be used whenever a renovation project is being performed within 10 feet of the property line. This requirement will help to ensure that neighboring properties are not contam inated by exterior renovations. The final rule also amends the regulatory text to remind renovation firms to consider the possibility for windy conditions when designing exterior containm ent. Finally, the rule adds a definition of “containment” that provides additional guidance on what vertical containment consists of and what should generally be considered when designing containment systems.

In EPA’s economic analysis for the 2008 RRP rule, EPA addressed those situations where the renovation firm must take extra precau tions to effectively contain dust and debris, including work areas in close proximity to other buildings, work areas that abut a property line, and windy conditions. The 2008 economic analysis specifically notes th at it is sometimes necessary to erect a system of vertical cont ainment to prevent paint dust and debris from contaminating the ground or any object beyond the work area. To account for these situations,*** EO12866 Review Draft – Delibera tive Document – Do NOT Cite, Quote or Release During the Review ***

March 8, 2011 (RIN 2070-AJ57) 7 EPA estimated that approximately 2% of exterior jobs would use exterior containment, and the

incremental cost of vertical containment vari es from $330 per wall to $1,640 per wall, depending on the size of the job. Thus, EPA has already ac counted for the additional costs incurred for using vertical containment system s on renovations performed within 10 feet of the prope rty line.

12. Prohibited and restricted practice clarifications. The final rule contains a number of minor revisions to the language on prohibited an d restricted renovation practices, and adds a definition of “painted surfaces” to further clarif y when practices are prohibited or restricted. Specifically, the final rule clarif ies that the prohibiti ons and restrictions on renovation practices, such as the prohibition on open flame burning or to rching, apply to all painted surfaces, not just surfaces where the presence of lead-based paint ha s been confirmed. The definition of “painted surface” additionally clarifies that term means component surfaces that contain paint or other surface coatings. The final rule also clarifies th at the restriction on the use of machines that remove paint through high speed operation a pplies anywhere painted surfaces are being disturbed by such machines, the restriction is no t limited to situations where all of the paint is removed by such machines. Lastly, the final ru le clarifies what EPA meant by HEPA exhaust control. These revisions clarify existi ng requirements and reflect established EPA interpretations. Therefore, these revi sions do not impose additional costs.

13. HEPA vacuum operation and maintenance. The final rule adds a requirement that high-efficiency particulate air (HEPA) vacuums be operated and maintained in accordance with the manufacturer’s recommendations, including f ilter change intervals. HEPA vacuums are already mandatory for the specialized cleaning pr otocol required by the RRP rule. While this revision may add some additional costs in the form of more frequent filter changes, EPA believes that most renovation firms are already operati ng and maintaining their HEPA vacuums in

accordance with the manufacturer ’s instructions. EPA is unable to estimate how many renovation firms are not doing so, and might thereby incur additional costs to comply with this new requirement.

14. On-the-job training . The final rule clarifies that the certified renovator assigned to the renovation must only provide on-the-job training to other re novation workers (who have not had certified renovator training) in the RRP-required work practic es that the renovation workers will be performing. This is a stakeholder-reque sted clarification of the existing RRP rule requirements and does not add any costs.

15. Grandfathering cut-off date. The effective date of the final rule will be the last date that individuals may take advantage of the “gra ndfathering” provisions of the RRP rule. Under the 2008 RRP rule, individuals who successfully complete an accredited abatement worker or supervisor course, and indivi duals who successfully complete the HUD, EPA, or the joint

EPA/HUD model renovation traini ng courses may take an a ccredited refresher renovation training course in lieu of the initial renovation training to become a cer tified renovator. In addition, individuals who have successfully comple ted an accredited lead-based paint inspector or risk assessor course, but are not currently ce rtified in the discipline, may take an accredited refresher dust sampling technician course in lieu of the initial training to become a certified dust sampling technician.

While this restriction is likely to impose so me burdens on individuals wishing to become certified renovators or dust sampling technicians, EPA is unable to estimate the extent of these*** EO12866 Review Draft – Delibera tive Document – Do NOT Cite, Quote or Release During the Review ***

March 8, 2011 (RIN 2070-AJ57) 8 burdens. EPA does not have information on the ava ilability of pre-RRP lead-safe work practices courses, nor can EPA estimate how many previ ously-trained individu als would choose to

become renovators after the effective date of the rule.