*** EO 12866 Review Draft – Deliberative – Do Not Cite, Quote or Release During Review ***

1 EO12866_RIN2070-AJ92_Formaldehyde-Imp_N PRM_IRFA_2013-04-11_MARKUP.docx 

### 1
2 Initial Regulatory Flexibility Analysis for 

### 3 Formaldehyde Emission Standard s for Composite Wood Products 

### 4 Proposed Rule; RIN 2070-AJ92 

### 5
6
7 U.S. Environmental Protection Agency, Office of Pollution Prevention and Toxics 

### 8 January 2012 

### 9 April 2013 

### 10
11
12 Pursuant to section 603 of the Regulatory Flexibility Act (RFA) (5 U.S.C. § 601 et seq.), EPA has 

### 13 prepared this initial regulatory flexibility analys is for the “Formaldehyde Emission Standards for 

### 14 Composite Wood Products” proposed rule. 

### 15
16

1. Need For the Rule 

### 17 18 TSCA section 601(d) directs EPA to promulgate regulations to implement the formaldehyde 

### 19 standards for composite wood products described in TSCA section 601(b)(2). EPA is issuing a proposed 

### 20 rule under TSCA Title VI to implement the stat utory formaldehyde emission standards for hardwood 

### 21 plywood, medium-density fiberboard, and particleboar d sold, supplied, offered for sale, or manufactured 

### 22 (including imported) in the United States. As directed by the statute, this proposal includes provisions 

### 23 relating to, among other things, laminated products, pr oducts made with no-added formaldehyde resins, 

### 24 testing requirements, product labeling, chain of custody documentation and other recordkeeping 

### 25 requirements, and product inventory sell-through prov isions, including a product stockpiling prohibition. 

### 26
27 2. Objectives and Legal Basis for the Rule 

### 28 29 The legal basis for the rule is TSCA secti on 601(d), which provides authority for the 

### 30 Administrator to “promulgate regulations to implem ent the standards required under subsection (b) in a 

### 31 manner that ensures compliance with the emission stan dards described in subsec tion (b)(2).” Therefore, 

### 32 the central objective of this proposal is to ensu re compliance with the TSCA Title VI formaldehyde 

### 33

emission standards. 

### 34
35 3. Description and Number of Small Entities to Which the Rule Will Apply 

### 36 37 The proposed rule potentially affects small ma nufacturers (including importers), fabricators, 

### 38 distributors, and retailers of composite wood products. These may include, but are not limited to, entities 

### 39 in the following industries: 

### 40
41 • Hardwood Veneer and Plywood Manufacturing (NAICS code 321211); 

### 42

• Reconstituted Wood Product Manuf acturing (NAICS code 321219); 

### 43 • All Other Miscellaneous Wood Product Manufacturing (NAICS code 321999); 

### 44 • Furniture and Related Product Manufacturing (NAICS code 337); 

### 45 • Miscellaneous Manufacturing (NAICS code 339); 

### 46 • Merchant Wholesalers, Durable Goods (NAICS code 423); 

### 47 • Merchant Wholesalers, Nondurable Goods (NAICS code 424); and 

### 48 • Retail Trade (NAICS Sector 44 and 45). 

### 49
50 This listing is not intended to be exhaustive, but rather provides a guide for readers regarding entities 

### 51 likely to be affected by this action. Othe r types of entities could also be affected. 

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2 

### 53 For purposes of assessing the impacts of the rule on small entities, small entity is defined as: (1) a 

### 54 small business as defined by the Small Business Ad ministration’s (SBA) regulations at 13 CFR 121.201; 

### 55 (2) a small governmental jurisdictio n that is a government of a city, county, town, school district or 

### 56 special district with a population of less than 50,000; and (3) a small organization that is any not-for-profit 

### 57 enterprise which is independently owned and op erated and is not dominant in its field. 

### 58 59

EPA estimates that the rule will aff ect approximately 879,000 small entities. 

### 60
61 4. Projected Compliance Requirements, Classes of Small Entities Subject to the Compliance 

### 62 Requirements, and Professional Skills Needed to Comply 

### 63 64 A. Projected Compliance Requirements 

### 65
66 This proposal implements the statutory form aldehyde emission standards for hardwood plywood, 

### 67 medium-density fiberboard, and particleboard sold, s upplied, offered for sale, or manufactured (including 

### 68 imported) in the United States. As directed by the statute, this proposal includes provisions relating to, 

### 69 among other things, laminated products, products made with no-added formaldehyde resins or ultra-low 

### 70 emitting formaldehyde resins, testing requirements, produ ct labeling, chain of custody documentation and 

### 71 other recordkeeping requirements, and product inve ntory sell-through provisions, including a product 

### 72 stockpiling prohibition. This proposal would esta blish requirements for manufacturers (including 

### 73 importers), fabricators, distributors, and retailers of composite wood products. The regulatory provisions 

### 74 in this proposal are designed to ensure complia nce with the TSCA Title VI formaldehyde emission 

### 75 standards while aligning, where practical, with the regulatory requirements under the California Air 

### 76 Resources Board’s (CARB) Airborne Toxic Control M easure (ATCM) to reduce formaldehyde emissions 

### 77 from composite wood products. By aligning itself with the existing CARB requirements, EPA seeks to 

### 78 avoid differing or duplicative regulatory requirements that would result in an increased burden on the 

### 79 regulated community. 

### 80
81 B. Classes of Small Entities Subject to the Compliance Requirements 

### 82 83 Small entities include small businesses, sm all organizations, and small governmental 

### 84 jurisdictions. The small entities that are potentially di rectly regulated by this rule are small businesses 

### 85 that are manufacturers (including importers), fabricat ors, distributors, or retailers of composite wood 

### 86 products. No small governments or small organizations ar e expected to be directly regulated by the rule. 

### 87
88 C. Professional Skills Needed to Comply 

### 89 90 Each panel producer must designate a person as quality control manager with adequate 

### 91 experience and/or training to be responsible for formaldehyde emission quality control. EPA has not 

### 92 proposed criteria for determining whether an individual’s experience or training are appropriate for this 

### 93 position, but experience in the wood products industry or a degree in chemistry or a related field might 

### 94 provide the skills needed to co mply with the requirements. 

### 95
96 A panel producer must be able to follow sampling and handling procedures for the material that is 

### 97 to be tested. However, those procedures must be described in the facility’s quality control manual, and 

### 98 specified skills should not be needed to follow the written procedures. 

### 99 100 Each panel producer must also designate a qua lity control facility for conducting quality control 

### 101 formaldehyde testing, and the quality control facility must have quality control employees with adequate 

### 102 experience and/or training to conduct accurate chemical quantitative analytical tests. But instead of 

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

3 performing these functions themselves, panel producers ha ve the option of hiring an accredited third party 

### 104 certifier (TPC) or a contract laboratory to fulfill these requirements. 

### 105
106 To obtain product certification, a panel producer must apply to an accredited TPC, and must 

### 107 provide information and notifications to the TPC. Fi nally, manufacturers, fabricators, distributors, or 

### 108 retailers of composite wood products must maintain records, and may need to request information from 

### 109 their suppliers and provide information to their cust omers. None of these activities requires any special 

### 110

skills. 

### 111
112 5. Other Federal Rules that may Duplicate, Overlap, or Conflict with the Rule 

### 113
114 The U.S. Department of Housing and Urban Development (HUD) has regulations governing 

### 115 formaldehyde emission levels from plywood and partic leboard materials installed in manufactured homes. 

### 116 (See 24 CFR 3280.308.) However, TSCA Title VI esta blishes specific formalde hyde emission standards 

### 117 for hardwood plywood, particleboard, and medium-densi ty fiberboard and does not provide EPA with the 

### 118 authority to modify these standards. Furthermor e, the Formaldehyde Standards for Composite Wood 

### 119 Products Act, which includes TSCA Title VI, directs HUD to revise th eir regulations to ensure that they 

### 120

reflect the emission standards in TSCA Title VI. An d the HUD regulations do not deal with the other 

### 121 elements addressed in these implementing regulati ons (where EPA does have the authority to make 

### 122 determinations) such as laminated products, pr oducts made with no-added formaldehyde resins or ultra

### 123 low emitting formaldehyde resins , testing requirements, chain of custody documentation, and product 

### 124 inventory sell-through provisions. Therefore, the re gulatory provisions of this proposal for which EPA 

### 125 has flexibility in implementing the statute do not dupl icate, overlap, or conflict with any other Federal 

### 126

rules. 

### 127
128 6. Potential Economic Impacts on Small Entities 

### 129 130 Of the nearly 879,000 small firms affected by th e rule, approximately 851,000 (about 97 percent) 

### 131 are expected to have costs impacts that are less than one percent of their revenues, 23,000 firms (about 3 

### 132 percent) are expected to experience impacts at levels between one and three percent of their revenue, and 

### 133 4,000 firms (less than 1 percent) are expected to incur costs exceeding three percent of their revenues. 

### 134
135 Many of the firms with cost impacts above 1 percent of their revenues are fabricators, 

### 136 wholesalers, and retailers with annualized costs less than $250 (i.e., they are firms with annual revenues 

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

### 138 3 percent and 42 percent of the firms with cost impacts that exceed 3 percent. 

### 139
140 7. Minimization of Economic Impacts on Small Entities Consistent with Statutory Objectives, 

### 141

and Consideration of Alternatives 

### 142 143 A. Small Business Advocacy Review Panel 

### 144 145 As required by section 609(b) of the RFA, as amended by the Small Business Regulatory 

### 146 Enforcement Fairness Act (SBREFA), EPA conducted outreach to sma ll entities and convened a Small 

### 147 Business Advocacy Review Panel on February 3, 2011 to obtain advice and recommendations of 

### 148 representatives of the small entities that potentially would be subject to the rule's requirements. The Panel 

### 149 solicited input on all aspects of th ese proposed regulations and on the framework for the third-party 

### 150 certification program under TSCA Title VI. Seventee n potentially-impacted small entities served as 

### 151 small-entity representatives (SERs) to the Panel, repr esenting a broad range of small entities from diverse 

### 152 geographic locations, and five trade associations. The Panel concluded its deliberations on April 4, 2011. 

### 153
154*** EO 12866 Review Draft – Deliberative – Do Not Cite, Quote or Release During Review ***

4 Consistent with the RFA/SBREFA requirements, the Panel evaluated the assembled materials and 

### 155 small-entity comments on issues related to elements of the IRFA. It is important to note that the Panel’s 

### 156 findings and discussion were based on the information available at the time the final report was prepared. 

### 157

EPA has continued to conduc t analyses relevant to the proposed ru le, and additional information may be 

### 158 developed from public comment on the proposed rule. 

### 159
160 The Panel’s most significant findings and reco mmendations on the TSCA Title VI implementing 

### 161 regulations are summarized below. 

### 162
163

1. In general . The Panel recommended that EPA adopt regulatory requirements that are 

### 164 consistent with the CARB ATCM wherever possible. EPA agrees with this recommendation and has 

### 165 tried throughout this proposal to remain consis tent with CARB where it is practical to do so. 

### 166
167

2. Manufactured-by dates and stockpiling . The Panel generally agreed with those SERs that 

### 168 recommended that EPA propose to establish the manufact ured-by date at 180 days after promulgation of 

### 169 the final rule and make the reference period for de termining whether stockpiling has occurred the 12 

### 170 month period prior to promulgation of the final rule. 

### 171
172 EPA is proposing to establish the manufactured-by date at 1 year after promulgation of the final 

### 173 rule. This is primarily to allow for development of the third-party certification infrastructure and to give 

### 174 panel producers who are not already complying with the CARB ATCM adequate time before the 

### 175 manufactured-by date to select an accredited third-pa rty certifier, develop a quality control manual, and 

### 176 complete the initial testing to qua lify for product certification. 

### 177
178 EPA is proposing to establish the stockpiling reference period, or base period, as the calendar 

### 179 year 2009 because, under TSCA Title VI, the base peri od must end before the statute was enacted. 

### 180
181

3. Quality control and compliance testing . The Panel recommended that EPA consider CARB’s 

### 182 method of establishing equivalency and carefully eval uate any alternative test method permitted. EPA is 

### 183 proposing to use CARB’s method of establishing equi valency between test methods and EPA is also 

### 184 proposing to recognize those alternative test methods that CARB has approved. 

### 185
186 The Panel further recommended that EPA provide clear direction on product decertification and 

### 187 recertification procedures and the recall of noncompliant products. In response to these 

### 188 recommendations, EPA has proposed specific provisions on what actions are required and allowed in the 

### 189 event of a failed test result. EPA has also proposed to require panel producers to hold lots selected for 

### 190 testing until the test results are received. 

### 191 192

4. Labeling and recordkeeping. The Panel generally recommended that labeling and record 

### 193 keeping provisions should be closely harmonized w ith CARB’s requirements, including allowing panels 

### 194 to be labeled by bundle, rather than individually. Th e Panel did recognize that subtle differences between 

### 195 the TSCA Title VI implementing regulations a nd the CARB ATCM may make identical labels 

### 196 impossible. EPA is proposing labeling requirements that are virtually identical to CARB’s, except that 

### 197 the labels must say that the products are TSCA Title VI compliant instead of CARB compliant. For 

### 198 entities that are manufacturers under TSCA (i.e., th ey manufacture, produce, or import composite wood 

### 199 panels, component parts, or finished goods), EPA’s proposed recordkeeping and chain

- of custody 

### 200 documentation requirements are also virtually identical to CARB’s. For distributors and retailers that are 

### 201 not manufacturers under TSCA, EPA is proposing that the only records they be required to keep are 

### 202 invoices and bills of lading. This requirement is less burdensome than reco rdkeeping and chain of 

### 203 custody requirements similar to those in the CARB ATCM. 

### 204
205*** EO 12866 Review Draft – Deliberative – Do Not Cite, Quote or Release During Review ***

5 5. Laminated products and engineered veneer. The Panel recommended that EPA continue to 

### 206 seek available information, and exempt those laminate d products that can be exempted consistent with the 

### 207 direction given in TSCA Title VI. The Panel further recommended that EPA work with small businesses, 

### 208 especially those laminating on a made-to-order basis, to design a testing scheme that is practical for those 

### 209 businesses, and at the same time, is calculated to ensure compliance with the emissions standards. The 

### 210 Panel also recommended that EPA consider basing the number and frequency of required quality control 

### 211 tests on production volume, thereby requiring fewer tests for smaller producers. EPA has incorporated all 

### 212 of these recommendations into this proposal, by pr oposing to exempt laminated products that are made 

### 213 with certified platforms and NAF resins, and by prop osing to allow for quality control testing frequency 

### 214 based on production volume for hardwood plywood producers. 

### 215
216

6. Definitions . The Panel recommended that EPA develo p a definition of “hardboard” that takes 

### 217 the revised ANSI standard into account while ensuring that similar products are similarly regulated under 

### 218

TSCA Title VI. While a revised ANSI standard for “hardboard” has yet to be finalized, EPA believes that 

### 219 its proposed definition takes into account both widespread industry usage of the term and the intent of the 

### 220

statute. 

### 221
222 Recognizing that TSCA Title VI was not intended to apply to structural plywood, the Panel also 

### 223 recommended that EPA develop a clear definition for “int erior use” in order to eliminate confusion in the 

### 224 regulated community. According to the Panel, the de finition should be based on the intent of the statute 

### 225 and consider how the hardwood plywood is likely to be us ed and stored once incorporated into a finished 

### 226 good. EPA has proposed a definition of “intended for interior use” that includ es these considerations. 

### 227
228

While the SERs differed in their advice on the definition of the term “panel,” the SBAR Panel 

### 229 recommended that EPA reduce uncertainty in the regu lated community by including in its regulation a 

### 230 clear definition of “panel” that is based on the inte nt of the statute, and c onsiders trade usage and the 

### 231 limitations of current test methods. Again, EPA is proposing a definition that takes these factors into 

### 232

account. 

### 233
234

B. Alternatives considered 

### 235 236
The Over the course of this rulemaking, EPA consid ered alternatives for various provisions of the 

### 237 rule. For example, EPA’s Economic Analysis 

### for the proposed rule examined a number of alternative 

### 238 analytical options in addition to the proposed rule . Among the alternatives based on the formaldehyde 

### 239 emissions standards set in Title VI of TSCA, EPA analyzed options with different 

### options provisions for 

### 240 how laminated products might be included in the definition of hardwood plywood, certification of 

### 241 ULEF products, and 

### for the rule’s chain of custody and recordkeeping requirements. 

### These Most of the 

### 242

alternatives EPA considered would have applied to bo th small and large entities



### , but

, given the number of 

### 243
small entities in the affected industries, some of these alternatives 

### would largely could affect many small 

### 244

entities. 

### 245
246

EPA 

### is proposing made a concerted effort to keep the 

### option costs and burdens associated with 

### 247 this rule as low as possibl e while still ensuring compliance with the 

### lowest total cost among these 248 options. This will minimize an y significant economic impact TSCA Title VI emissions standards. 

### 249 In developing the proposed rule, EPA considered the statutory requirements and the benefits from 

### 250 protection of human health and the environment, as well as the compliance costs imposed by the rule, 

### 251 both in general and on small entities. 

### The EPA took a number of steps to reduce the economic impact 

### 252 that might be imposed by this rule on both small a nd large entities, where doing so was consistent with 

### 253 the statutory mandate. Although EPA did not have suff icient information to analyze and quantify the cost 

### 254 and burden reductions resulting from many of these de cisions, these steps still reduce the impacts of the 

### 255 proposed rule. Some of the steps that EPA took are summarized below. 

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6 

### 257

1. Aligning with the CARB ATCM where practical . This regulatory proposal is designed to ensure 

### 258 compliance with the TSCA Title VI formaldehyde em ission standards while aligning, where practical, 

### 259 with the regulatory requirements in California in or der to avoid differing or duplicative regulatory 

### 260 requirements that would result in an increased burden on the regulated community. Some of the areas 

### 261 where EPA has aligned the proposal with the CARB ATCM are described below. Aligning the TSCA 

### 262 implementing regulations with California’s requiremen ts helps reduce costs for the nearly 100 composite 

### 263 wood product mills, the 32,000 fabricators, the 32,000 wholesalers, and the 101,000 retailers that are 

### 264 already complying with the CARB ATCM in the baseline. However, EPA deviated from the CARB 

### 265 ATCM where doing so would reduce burden while still ensuring compliance with the TSCA Title VI 

### 266

emissions standards. Based on EPA’s Economic Analysis 

### included two options fo r the , the proposed 

### 267 rule costs $19 million to $31 million per year less than an option that is fully consistent with the CARB 

### 268

ATCM. 

### 269
270

2. Defining hardwood plywood and laminated products . TSCA Title VI includes laminated products 

### 271

within the definition of hardwood plywood 

### that had higher total cost s than the proposed rule 272 (because they did not include the proposed rule’s unless EPA determines, based on all relevant and 

### 273 available information, that they can be exempted through rulemaking. EPA considered various options 

### 274 for the definition of hardwood plywood. EPA is prop osing to exempt laminated products in which a 

### 275 wood veneer is attached to a comp liant and certified platform using a NAF resin from the definition of 

### 276 hardwood plywood. Unlike panel producers, fabricators do not need to conduct formaldehyde emissions 

### 277 testing or comply with TPC certifica tion requirements. Instead, fabricators need to ensure that they are 

### 278 using compliant composite wood products through reco rdkeeping and labeling. These laminated product 

### 279 producers would also be required to maintain record s demonstrating that they are using NAF resins. 

### 280
281 EPA’s proposed definition of laminated product does not include the provision in the statutory 

### 282 definition limiting applicability to the manufacturer or fabricator of the finished good in which the 

### 283 product is incorporated. If EPA ha d retained the applicability limitation in TSCA Title VI, an entity that 

### 284 purchases certified particleboard or MDF panels, cuts and otherwise prepares them for future use as 

### 285 kitchen cabinet doors, attaches a hardwood veneer us ing a NAF resin, and then sells them to a kitchen 

### 286

cabinet manufacturer would not be considered a la minated product manufacturer and would not qualify 

### 287 for the proposed exemption from the definition of hardwood plywood. The door producer would then 

### 288 have to comply with the third party certification and testing requirements applicable to hardwood 

### 289 plywood manufacturers. By not differentiating between entities that produce an entire finished good and 

### 290 those that only produce part of the g ood, EPA’s proposed definition allows more entities to qualify for the 

### 291 exemption from the definition of hardwood plywood, which reduces the burden of compliance. 

### 292 293 Based on EPA’s Economic Analysis for the prop osed rule, the proposed definitions of hardwood 

### 294 plywood and laminated products will result in 98% of laminated product produc ers being regulated as 

### 295 fabricators rather than panel prod ucers. As a result, based on EPA’s Economic Analysis, the rule will 

### 296 cost $92 million to $172 million per year less than if all laminated products were included in the 

### 297 definition of hardwood plywood. 

### 298 299

3. Reducing recordkeeping for non-manufacturers . EPA is proposing that distributors and retailers that 

### 300 do not import, produce, or manufacture composite wo od panels, component parts, or finished goods be 

### 301 required to maintain invoices and bills of lading, inst ead of needing to obtain records identifying the panel 

### 302 producers that produced the composite wood products and the dates that the products were manufactured 

### 303 and purchased from the panel producers (similar to th e chain of custody and recordkeeping requirements 

### 304 in the CARB ATCM). EPA believes that distributors and retailers usually keep invoices and bills of 

### 305 lading as part of their general recordkeeping practices, so this re quirement does not impose additional 

### 306 recordkeeping burdens on most distributors and retail ers. Based on EPA’s Economic Analysis for the 

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

7 proposed rule, these reduced recordkeeping requirements decrease the cost of the rule by over $40 million 

### 308 per year compared to recordkeeping requirements similar to the CARB ATCM. 

### 309
310

4. Reducing testing for NAF and ULEF products . EPA proposes to provide producers of panels made 

### 311 with NAF or ULEF resins, as they are defined in TS CA Title VI, with an exemption from TPC oversight 

### 312 and formaldehyde emissions testing after an initial tes ting period of 3 months fo r each product type made 

### 313

with NAF resins and 6 months for each product type made with ULEF resins. EPA has not calculated the 

### 314 savings due to the NAF provisions, but based on EPA’ s Economic Analysis for the proposed rule, the 

### 315 ULEF provisions reduce the total rule costs by $0.5 million per year. 

### 316
317

5. Not requiring retailers to relabel . EPA is proposing that retailers that divide or repackage regulated 

### 318 composite wood products would not be required to label each separate bundle or item with the 

### 319 information on the original label. Exempting reta ilers from the relabeling requirements decreases costs 

### 320 for any retailers that may engage in these activities. 

### 321
322

6. Reducing quality control testing fo r small hardwood plywood producers . EPA is proposing to base the 

### 323 frequency of quality control testing for hardwood plywood producers on the amount of product produced. 

### 324 Hardwood plywood producers would have to test at le ast four times per week per product type and 

### 325 production line if weekly production is 400,000 square feet or more; at least twice per week if weekly 

### 326 production is 200,000 square feet or more but less than 400,000 square feet; and at least once per week if 

### 327 weekly production is 100,000 square feet or more but less than 200,000 square feet. And unlike the 

### 328 CARB ATCM, EPA is proposing to reduce the frequenc y of quality control testing for producers making 

### 329 less than 100,000 square feet of hardwood plywood per week per product type from once per week to 

### 330 once per 100,000 square feet. If the panel producer ne ver produces 100,000 square feet of a particular 

### 331 product type at one time, EPA is proposing to require ju st one quality control test of that product type per 

### 332 production run or lot produced. Furthermore, EPA is proposing that hardwood plywood producers not be 

### 333 required to conduct quality control testing when prod uct type production ends, changes are made to the 

### 334 resin formulation or the amount of resin used, or th ere is a significant decrease in press time. These 

### 335 provisions reduce the cost of quality control testing fo r eligible panel producers, particularly for very 

### 336 small panel producers. 

### 337
338

7. Reducing quality control testing for certai n panel producers with consistent operations . EPA is 

### 339 proposing to allow particleboard and medium-density fiberboard producers that demonstrate consistent 

### 340 operations and low variability of test values to requ est that their TPC reduce the required frequency of 

### 341 quality control testing from once per shift (8 or 12 ho urs) to up to once per 48-hours. This reduces the 

### 342 cost of quality control testing for eligible panel producers. 

### 343
344

8. Grouping of products and product types for testing . The proposal allows TPCs to approve the 

### 345 grouping of products with similar characteristics for qua rterly testing. It also allows flexibility in 

### 346 determining which products constitute a product type fo r quality control testing purposes, so that products 

### 347 with similar emissions made with the same resin system s may be considered to be the same product type. 

### 348 Allowing products and product types to be gr ouped like this reduces the cost of testing. 

### 349
350

9. Defining hardboard. EPA is proposing to define hardboard based on the ANSI standards A135.4 

### 351 (Basic Hardboard), A135.5 (Prefinished Hardboard Paneling), and A135.6 (Hardboard Siding). This 

### 352 definition will exempt hardboard products (including those made with phenol-formaldehyde resin) from 

### 353 the statutory emission standards and the testing an d certification requirements, so hardboard producers 

### 354

will not incur costs for those activities. 

### 355
356

10. Extending manufactured-by date for sell-through provisions . Although TSCA Title VI allows EPA 

### 357 to set the manufactured-by date for the sell-through provisions at 180 days after promulgation of the final 

### 358 rule, EPA proposes to set this date at 1 year after publication of the final rule. Extending the compliance 

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

8 timetable beyond the statutory minimum decreases the compliance burden on panel producers, by 

### 360 allowing them extra time to seek certification of their products. 

### 361
362

11. Allowing alternate test methods . EPA is proposing that in addition to ASTM D-6007-02 and ASTM 

### 363 D-5582, the following methods would also be allowe d for quality control testing (with a showing of 

### 364 equivalence): EN 717-2 (Gas Analysis Method), DMC (Dynamic Micro Chamber), EN 120 (Perforator 

### 365 Method), and JIS A 1460 (24-hr Desiccator Method). Allowing this flexibility in test methods decreases 

### 366 the cost of complying with the rule, particularly for firms that 

### are not manufacturers have already 

### 367 adopted an alternate test method under 

### TSCA) but that were the CARB ATCM. 

### 368
369

12. Not requiring recordkeeping for exempt products . EPA is proposing that manufacturers, fabricators, 

### 370 distributors, and retailers of products exempted from the rule not be required to keep records 

### 371 demonstrating that they are exempt. For example, windows that contain less than five percent by volume 

### 372 of composite wood products, exterior doors and gara ge doors that contain less than three percent by 

### 373 volume of composite wood products , and exterior and garage doors made with NAF-based or ULEF

### 374 based resins are exempt. Firms selling such window s and doors would not be required to maintain 

### 375 records showing that the products qualify for an exemption, which reduces the recordkeeping costs for 

### 376

these firms. 

### 377
378

13. Continuing existing certifications . EPA could have prohibited the sale of products certified under the 

### 379 CARB ATCM until they were recertified by a TPC ac credited under the TSCA program, effective with 

### 380 the publication of the final rule. Instead, EPA’s pr oposed TPC rule allows TPCs approved by CARB to 

### 381 certify products under TSCA Title VI until one year after the publication of the final rule, as long as they 

### 382 remain approved by CARB for that period and comply with all aspects of the TSCA program other than 

### 383 the accreditation requirements. Under the proposed implementation rule, products currently certified by 

### 384 these TPCs would be considered certified for purpo ses of TSCA Title VI during that same period. 

### 385 Allowing the temporary continuation of existing certifications provision is less burdensome 

### to c ertain 386 laminated product producers. Specifically, one of the for mills than preventing any of them from 

### 387 selling their products until their TPC is accredited by a TSCA Title VI recognize d accreditation body or 

### 388

bodies. 

### 389 390

14. Allowing representative emission levels to be us ed to demonstrate test method equivalence . The 

### 391 CARB ATCM requires a demonstration of equiva lence between ASTM E-1333-10 and any other 

### 392 approved test method. This equivalence demonstrati on is based on ten comparison sample sets consisting 

### 393 of testing a minimum of five sample sets in each of at least two of three ranges of emissions. Like 

### 394 CARB, EPA is also allowing test methods other than ASTM E-1333-10 to be used if the results are 

### 395 shown to be equivalent to ASTM E-1333-10. However, EPA believes that it will be very difficult, if not 

### 396 impossible, to find products with emissions in the in termediate range (0.07 to less than 0.15 ppm) and the 

### 397 upper range (0.15 to 0.25 ppm), because the levels in the intermediate range exceed the CARB Phase 2 

### 398 standards for some products, and the levels in the upper range exceed the CARB Phase 2 standards for all 

### 399 products. Instead, EPA is proposing that equivale nce be demonstrated in a range of formaldehyde 

### 400 concentrations that is representative of the emissions of the products that the TPC certifies. This will 

### 401 reduce the burden of showing test method equivalence, as it will not require testing samples at emissions 

### 402 levels that may not be commercially available. 

### 403
404 EPA also considered and rejected various alternatives to the rule that could also affect the 

### 405 economic impacts of the rule on small entities. For the reasons described below, these alternatives are not 

### 406 consistent with the statutory objectives of the rule and are not included in the proposed rule. 

### 407
408

1. Exempting additional products from the definition of hardwood plywood . EPA is proposing to exempt 

### 409 laminated products in which a wood veneer is attached to a compliant and certified platform using a NAF 

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

9 resin from the definition of hardwood plywood. EPA considered other alternatives to excluding some or 

### 411 all laminated products from the definition of hardwood plywood. One alternative 

### options would have 412 excluded all laminated products from the definition of hardw ood plywood, and the second would 413
have option in EPA’s Economic Analysis excluded all laminated products other than architectural panels 

### 414 and custom plywood from the definition of hardwood plywood. 

### Both Other alternatives in the 

### 415 Economic Analysis excluded all laminated products from the definition of hardwood plywood (along with 

### 416 various combinations of other potential rule provisions). All of these alternative options would apply 

### 417 regardless of the types of resins used in making the laminated products exempted from the definition of 

### 418 hardwood plywood. 

### 419
420 Because eligibility for the exemptions for lamina ted products in the alternative options was not 

### 421 based on the type of resins used to attach a wood veneer to a platform, currently available information 

### 422 indicates that these options would have allowed la minated products that exceed the formaldehyde 

### 423 emission standards to be exempted from the definition of hardwood plywood. Therefore , on the basis of 

### 424 information currently available to the Agency , EPA has concluded that such alternative options are not 

### 425 consistent with TSCA Title VI’s statutory mandate that EPA promulgate regu lations in a manner that 

### 426 ensures compliance with the emission stan dards in TSCA section 601(b)(2). 

### 427
428

2. P roviding additional de minimis exceptions . EPA has decided not to propose an exception from any of 

### 429 the regulatory requirements for products containing small amounts of composite wood products, other 

### 430 than implementing the statutory exceptions for certain windows and doors. EPA does not have the 

### 431 authority to promulgate a de minimis exception to th e statutory requirements (e.g., emissions standards, 

### 432 or quarterly testing); rather EPA has the authority to promulgate a de minimis exception for the other 

### 433 regulatory provisions (e.g., record keeping, chain-of-c ustody, quality control testing, and labeling). EPA 

### 434 does not know of any information that suggests that products with a de minimis amount of composite 

### 435 wood products would necessarily be made from panels that meet the statutory emissions standards, as 

### 436 required by the statute. Thus, EPA believes it is necessary to make these products subject to the already 

### 437 reduced regulatory requirements. EPA has concluded th at, on the basis of information currently available 

### 438 to the Agency, excepting such products would not be consistent with TSCA Title VI’s statutory mandate 

### 439 that EPA promulgate regulations in a manner that ensures compliance with the emission standards in 

### 440 TSCA section 601(b)(2). 

### 441
442

3. Not requiring retention of tested lots . EPA is proposing to require that panel producers retain lots of 

### 443 composite wood products from which quality control or quarterly samples have been selected until the 

### 444 samples have been tested and the results received. Without this requirement, panel producers could 

### 445 inadvertently sell products exceeding the emission sta ndards in TSCA section 601(b)(2). Furthermore, 

### 446 EPA believes that the proposed approach may be less burdensome overall and offer better protection to 

### 447 importers, distributors, wholesalers, retailers, and consumers than an approach relying on after-the-fact 

### 448

enforcement actions and customer notifications. 

### 449
450