ATTACHMENT B



## SOCIOECONOMIC IMPACT ASSESSMEN T

PROPOSED AMENDED RULE 6 7

. 16

- GRAPHIC ARTS OPERATIONS

Ju ly 20 11

Prepared by

San Diego County Air Pollution Control District

10124 Old Grove Road San Diego, CA 92131SIA for SDAPCD Rule 67. 16 B

- 2 SOCIOECONOMIC IMPACT A SSESSMENT

PROPOSED AMENDED RULE 67.16

– GRAPHIC ARTS OPERATIONS

TABLE OF CONTENTS

PAGE

EXECUTIVE SUMMARY 3

I. INTRODUCTION 4

II. NECESSITY OF AMENDMENTS TO RULE 67.16 4

III. SUMMARY OF PROPOSED AMENDMENTS 5

IV. TYPE OF INDUSTRIES AFFECTED BY AMENDED RULE 67.16 5

V. ESTIMATED EMISSIONS IN FROM GRAPHIC ARTS OPERATIONS IN SAN DIEGO COUNTY 6

VI. EMISSION REDUCTION POTENTIAL AND COS T

- EFFECTIVENESS OF THE PROPOSED AMENDMENTS 7

VII. RANGE OF PROBABLE COSTS TO INDUSTRY INCLUDING SMALL BUSINESS 9

VIII. CONCLUSION 10

REFERENCESSIA for SDAPCD Rule 67. 16 B

- 3 

### EXECUTIVE S UMMARY

This report represents the results of a socioeconomic impact assessment (SIA) of the San Diego County Air Pollution Control District’s (District) proposed amended Rule 67.16

- Graphic Arts Operations. The proposed rule will comply with the latest federal Control Technique s Guid elines (CTG s ) for lithographic, letterpress and flexible packaging printing industries.

P roposed amended Rule 67.16 contains v olatile o rganic c ompound (VOC) emission limits for inks, adhesives, coatings, fountain solution s and cleaning materials used in conventional (analog) printing processes . These limits are at least as stringent as those established by the federal

CTGs. The rule provides new exemptions for cleaning of UV lamps and reflectors

, electronic beam proce ssors and stripping of cured inks, coatings and adhesives. The amended rule also

includes new and revised definitions and updated test methods for determining compliance.

In addition, the rule contains an exemption for digital printing operations (compa ratively new technology) provided that specified records are kept for large scale digital printing operations

, as defined. This will allow the District to estimate the magnitude of VOC emissions from digital printing and provide an answer as to whether it is necessary to control them

.

It i s not anticipated that the proposed amendments will have a significant socioeconomic impact

on affected industries. SIA demonstrates that proposed emission limits in the rule are feasible and that complying materials a re available in the market place. Many printing facilities in San Diego County are already using fountain solutions, cleaning and adhesive materials that comply

with the proposed lower VOC content limits. The estimated cost

- effectiveness of proposed

amen dments to Rule 67.16 is well within the District threshold for the rules regulating VOC emissions that reflect Reasonably Available Control Technology.SIA for SDAPCD Rule 67. 16 B

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I. INTRODUCTION

California law requires air pollution control districts (excluding those with popul ations of less than 500,000 people) to perform a socioeconomic impact assessment (SIA) when adopting, amending, or repealing rules and regulations that will significantly affect air quality and emission

limitations.

The Health and Safety (H&S) Code Sectio n 40728.5, subdivision (b) specifies the following elements to be included in the socioeconomic impact assessment:

1. The type of industries or business, including small business, affected by the rule or regulation.

2. The impact of the rule or regulatio n on employment and the economy of the region affected by the adoption of the rule or regulation.

3. The range of probable costs, including costs to industry or business, including small business, of the rule or regulation.

4. The availability and cost

- e ffectiveness of alternatives of the rule or regulation.

5. The emission reduction potential o f the rule or regulation.

6

. The necessity of adopting, amending, or repealing the rule or regulation in order to attain state and federal ambient air quality st andards.

The H &S Code S ection 40 728.5 , s ubdivision ( e) states that “ upon the approval by a majority

vote of the district board, a county distri ct is n ot required to include the analysis specified in paragraphs (2) and (4) above in any assessment of econom ic impacts of any rule or regulation that only ha s a requirement that is substantially similar to, or is required by, state, or federal statute, regulation or applicable formal guidance document ”

.

The proposed amendments to Rule 67.16 comply with the emis sion standards of two federal guidance documents: Control Technique G uidelines (CTGs) for O ffset Lithographic Printing

and Letterpress Printing ( 1) and for Flexible Package Printing ( 2) . Therefore, the following report
does not include the analysis requi red by paragraphs (2) and (4)

II. NECESSITY OF AMEND ING RULE 67.16

San Diego County Air Basin does not attain the National and State Ambient Air Quality

Standards for ozone. Both federal and s tate laws require the District to implement rules that

co ntrol emissions of ozone precursors

-- volatile organic compounds (VOC) and oxides of nitrogen

. Current Rule 67.16

– Graphic Arts Operations regulates VOC emissions from printing and related operations. In addition, in 2006 the Environmental Protectio n Agency (EPA) issued two Control Technique s Guidelines (CTGs) for printin g industry: the CTG for Lithographic andSIA for SDAPCD Rule 67. 16 B

- 5

Letterpress Printing 1 and the CTG for Flexible Package Printing 2 that established more stringent

emission limits for cleaning solvents and f ountain solutions tha n those in existing Rule 67.16. The proposed amended Rule 67.16 follows the federal guidel ines. In addition, the rule requires updating because it was last amended in 1996.

III. SUMMARY OF PROPOSED AMEND MENTS TO RULE 67.16

The am ended rule will:

Reduce the VOC content limit for non

- refrigerated fountain solutions to 5% VOC by volume, and to 8.5% for refrigerated fountain solutions;

For cleaning materials, establish the new, lower emissions limits: VOC c ontent less than 100 g/l it er, or VOC vapor pressure 5 mm Hg at 20 o C or less;

Establish a new VOC content limit for adhesives at 150 g/liter, less water and less exempt compounds;

Include new or revised definitions including definitions for digital printing operations;

Exempt dig ital printing operations from Rule 67.16, provided that specified records are

maintained for large operations with a print capacity as defined in the rule ;

Provide new exemptions for stripping of cured inks, coatings and adhesives, cleaning of UV lamps a nd reflectors and electronic beam processors ; and

,

Update the test methods for determining VOC content of graphic arts and cleaning

materials and VOC vapor pressure of cleaning materials and the overall control efficiency of emission control systems.

IV

. TYPE OF INDUSTRIES AFFECTED BY AMENDED RULE 67.16

Proposed amended Rule 67.16 will affect owners and operators of companies conducting graphic arts operations , such as lithographic, letterpress and flexographic printing (NAICS Code 32311). Presently, t here are 16 companies with permits to operate in San Diego County subject to

Rule 67.16

. The m ajority of them (13 ) conduct lithographic printing

.

L ithography is a printing technique where the image and non

- image areas are on the same plane on a printi ng plate. The image area of the plate is hydrophobic (repels water) and the non

- image

area is hydrophilic (attracts water). A water system continually supplies a fountain solution wetting the non

- image area. Often lithographic processes are offset, i.e.

, the ink is transferred from the plate to a rubber blanket and then to a paper substrate. Lithography is used mostly in newspaper and book printing. Three companies in the county conduct flexographic printing where the image carrier is made of elastomer ic material and the image is raised above the non

-SIA for SDAPCD Rule 67. 16 B

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image area. The substrates in flexographic printing include plastic film s , foil, paper board s and envelopes , textiles, etc. One company uses letterpress printing, the oldest printing technology

where rais ed inked metal type is applied directly onto the substrate , in this case onto paper plates.

The newest printing technique that became qu ite popular in the last decade is digital printing. Unlike traditional printing it does not use real metal or rubber p lates to create images. The images are generated electronically in a computer that uses digital file s such as PDFs (portable document formats) and sends the images to a printer (inkjet or laser)

.

V. ESTIMATED VOC EMISSIONS FROM GRAPHIC ARTS OPERATIONS

IN SAN DIEGO COUNTY

VOC emissions from traditional analog printing processes occur a s a result of using VOC

- based inks, cleaning solvents, and fountain solutions. The magnitude of VOC emissions from these

processes is very well established , including emission factors for cleaning materials and inks,

i.e.

, their VOC content, and retention factors for VOC

- and water

- based inks applied t o porous surfaces such as paper.

T able 1 on the following page contains a list of facilities subject to proposed amen ded Rule

67.16 and their VOC emissions

. This list does not include operations

, each emitting less than an

average 15 lbs VOC per day of operation

, calculated on monthly basis

, that are exempt from the

rule emission limits

. These operations are also exempt from District permit requirements by

current Rule 11 (Exemptions from Rule 10 Permit Requirements) . In addition, T able 1 does not include facilities conducting digital printing operation s because the ir VOC emissions are not yet quantified

. It is assumed in th is report that such emissions are below the permit requirement

threshold (average of 15 lbs per day calculated on monthly basis from all operations at a stationary source ) as specified in Rule 11.

Table 1 also contains the number of employees at eac h facility obtained from the data published by the California Employment Development Department 3 and from the information provided by the affected companies.

Table 1 shows that the total VOC emissions from sources subject to Rule 67.16 are about

6 4 tons/y ear, with the majority of emissions ( 6 6 %) coming from the use of cleaning materials.

Th e printing inks are not a main contributor to the total emissions from graphic arts operations

due to a significant retention of volatile organic compounds ( up to 95% of ink oils ) that occurs during non

- heat lithographic printing on porous substrates such as paper. Therefore, the proposed rule amendments almost entirely address control measures to reduce VOC emissions

from the use of cleaning materials.SIA for SDAPCD Rule 67. 16 B

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T able 1. Sources and VOC Emissions Subject to A mended Rule 67.16.

VOC Emissions tpy

Company Number of

Employees 3 Operation Fountain
Solutions Cleaning

Materials Total

,

including

inks

1 20

- 49 Lithographic, single sheet fed
heat set w/ cat. oxidizer; also

non

- heat set, digital 0 .01 0.02 2.6

2 App.195 Letterpress , single sheet fed Paper Plates printing 0 0.0 1 0. 1

3 50

- 99 Lithographic, single sheet fed 1.34 8.87 10.5

4 50

- 99 Lithographic web fed 0.06 6.23 7.9

5 20

- 49 Lithographic, web fed & flexograp hic, single sheet &

web fed 0.06 0.45 2.0

6 50

- 99 Lithographic, single sheet fed 0.01 0.65 1.0

7 50

- 99 Lithographic, single sheet fed 0 .01 6.62 7.6

8 App.500 Lithographic, web fed 0.13 2.24 2.8

9 50

- 99 Lithographic , web fed 0.19 2.57 3.4

10 100

- 24 9 Lithographic, web fed 0.21 1.35 1.9

11 100

- 249 Lithographic, web fed 0.71 5.96 7.0

12 50

- 99 Flexographic & lithographic,
web fed 0.1 0.71 2.2

13 50

- 99 Flexographic 0.06 1.29 3.1

14 20

- 49 Lithographic, web fed 0 .01 0.96 1.0

15 100 Lithographic, web fed 0.01 2.75 4.3

16 1 20 Flexographic, envelopes 0 1.6 6.7

Total 2.9 42.3 64

. 1

VI. EMISSION REDUCTION POTENTIAL AND COST

- EFFECTIVENESS OF THE

PROPOSED AMEND MENTS

1. Cleaning materials.

As shown in Table 1, the e stimated emissions from the use of cl eaning materials in graphic arts subject to the proposed amendments are approximately 42. 3 tons per year. These VOC

containing materials are used for manual and automatic cleaning of printing presses and their

parts. The proposed emission limits for cle aning materials in the amended Rule 67.16 are 100 g VOC per liter or a VOC vapor pressure of 5 mm Hg at 20 o C. In the current rule, t he VOC

content limit for cleanin g materials is 200 g/l or the VOC vapor pressure 45 mm Hg at 20 o C . If

all facilit ies choos e to use a cleaning material complying with the VOC content limit , the

estimated emission reduction will be approximately 50% , i.e. proportional to the reduction in the

VOC content , or approximately 2 1 tons per year.SIA for SDAPCD Rule 67. 16 B

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However, if a facility chooses to comp ly with the rule by using a cleaning material with a VOC vapor pressure not exceeding 5 mm Hg a 20 o C , estimating emission reduction s will present some problems . The majority of cleaning materials are mixtures of several organic compounds;

therefore it is very difficult to determine the correlation between the vapor pressure of such

mixture s and their evaporation rates. In addition, some graphic arts companies in San Diego

C ounty are already using cleaning materials with a complying VOC composite vapor pre ssure
, some are using solvents with a vapor pressure as low as 0.5 mm Hg at 20 o C.

Therefore , to be more realistic and assuming that only half of the estimated emission reductions will actually take place, this rule provision is conservatively estimated to reduce VOC emissions by 10. 5 tons per year.

The c urrent rule requires fountain solutions to contain less than 15 vol . % of VOC s . The proposed amendments will reduce the VOC concentration to 5vol

. % if a fountain solution is not refrigerated, or 8.5vol

. % if it is refrigerated to at least 60 o F

. As shown in Table 1, the total

emissions from fountain solutions are about 3 tons/year. The majority of fountain solutions presently used by the graphic arts industry in San Diego County do not contain high vol atility alcohols such as isopropyl alcohol, very widely used in the past. Instead, they use low volatility alcohols, or their esters. In addition, most fountain solutions are normally sold as concentrates

and are diluted with water

, sometimes in proporti ons as high as 1:10 or 1: 20. Many companies are already using fountain solutions that are in compliance with the VOC limits in the proposed

rule

. Therefore, it is not expected that reducing VOC concentration limits for fountain solutions

will result in measurable emission reductions

.

2. Adhesive materials.

The proposed VOC content limit for adhesives is reduced from 300 g/l to 150 g/l (less water and less exempt compounds). While this limit is significantly lower than the previous one, there will

be no significant emission reductions because adhesives are not used in the majority of graphic arts operations in the county. The companies that use adhesives are already in compliance with the proposed limit.

3. Cost

- effectiveness of the proposed rule.

The em ission limits of cleaning products will only affect the companies that are presently using

solvents with a VOC content close to 200 g/liter as prov ided by existing Rule 67.16. These companies will have to replace them with complying products, having eithe r a VOC content less than 100 g/liter, or with a low composite vapor pressure as required by the proposed rule.

It should be noted that many air districts in California, including s uch large districts as Bay Area

and South Coast Air Quality Management Dis trict s
, have very similar or even more stringent rules for graphic arts industry. Therefore low VOC content adhesives, cleaning materials and fountain solutions are widely available in the market place at the prices not much different from the cleaning pr oducts that w ere previously sold.SIA for SDAPCD Rule 67. 16 B

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The District’s information obtained from cleaning products manufacturers and local distributors of graphic arts materials shows that there is no significant difference in the cost of cleaning

materials complying with a pr oposed VOC composite vapor pressure limit and the ones presently

used. On the other hand, if a facility chooses to use cleaning products complying with the VOC

content limit of the amended rule, they will have to buy products that are slightly more expens ive

than the non

- complying ones. For example, according to the information from local distributors, conventional high VOC content solvents are sold for about $10 per gal lon , while low VOC content products cost between $10 and $17 per gal lon , with the aver age cost of $ 13.5 per gallon,

which is an increase of app roximately 35%. Assuming that the solvents complying with the proposed rule limits have the same cleaning effectiveness as previously used products, the cost effectiveness of the proposed rule wil l be about $2,265/ton, or $1.1/lb of VOC emissions

reduced 4

. This value is significantly lower than the District cost

- effectiveness threshold of $ 6 /lb

of VOC reduced for prohibitory rules reflecting RACT

.

In reality, the cost of compliance with proposed amendments to Rule 67.16 may be somewhat higher for some facilities because the amount of low VOC content p roducts used to achieve the same quality of cleaning may be higher than the amount of conventional cleaning materials . On

the other hand

, some printi ng companies in San Diego County may not need to replace cleaning

materials because they are using products that comply with the VOC vapor pressure limits in the proposed rule. T herefore they would not incur any additional expenses.

VII. RANGE OF PROBAB LE COSTS TO INDUSTRY INCLUDING SMALL

BUSINESS

As mentioned above, the majority of facilities subject to the rule will not incur any additional

costs as a result of amendments of Rule 67.16, because they either use low vapor pressure cleaning materials or have add

- on emission control equipment. Those facilities that will have to replace their high VOC content solvents will find a variety of complying materials at reasonable prices.

In the previous socioeconomic impact assessments for several proposed ru les, the District has defined a small business as an entity that meet s all of the condi tions below.

1. The business is independently owned and operated. (California Government Code, Section

11342 .610, Small Business definition)

2. The business is not dom inant in its field of operation. (Same)

3. The business has gross annual receipts not more than $500,000. (SCAQMD, Rule 102)

4. The business employ s ten persons or less. (SCAQMD Rule 102)

5. The business has t otal annual VOC emissions less than 10 tons . (H&S Code, Section 42323, Small Stationary Source).SIA for SDAPCD Rule 67. 16 B

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According to the District ’s permit files and information obtained from the California Employment Development Department 3 , none of the businesses subject to the proposed amended

rule meet all conditions mentioned above

. As shown in Table 1, all of them employ more than

ten people . In addition, some companies are not independently operated but are part of bigger corporations. Therefore proposed Rule 67.16 amendments will not affect small business es

.

III

. CONCLUSION

Proposed amended Rule 67.16 will not negatively impact affected indu stry, inclu ding small

business entities. It will provide air quality ben efits by reducing emissions of v olat ile o rganic compounds that are precursors of ground level ozon e, a major component of photochemical

smog.SIA for SDAPCD Rule 67. 16 B

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References

1. Control Techniques Guidelines for Offset Lithographic Printing, EPA 453/R

- 06002, September 2006

.

2

. Control Techniques Guidelines for Flexible Packagi ng Printing, EPA

- 453/R

- 06003

, September 200 6

.

3. California Employment Development Department, Labor Market Information, http://www.labormarketinfo.edd.ca.gov

.

4. Bay Area Air Quality Management District. Staff Report for the BAAQMD Regulation 8,

Rule 20

– Graphic Arts Printing and Coating Operations, October 2008.