Source: http://thefederalregister.com/2012/08/30/2012-21360.html
Timestamp: 2018-09-26 13:26:12
Document Index: 463275969

Matched Legal Cases: ['art 173', 'art 173', '§ 171', '§ 173', '§ 171', '§ 5125']

Instructions:All submissions must include the agency name and docket number for this notice at the beginning of the comment. All comments received will be posted without change to the Federal Docket Management System(FDMS), including any personal information.
SUPPLEMENTARY INFORMATION: Table of Contents I. Executive Summary II. Background III. Proposed Amendments IV. Summary Review of Proposed Amendments V. Regulatory Analyses and Notices A. Statutory/Legal Authority for This Rulemaking B. Executive Order 12866, 13563, and DOT Regulatory Policies and Procedures C. Executive Order 13132 D. Executive Order 13175 E. Regulatory Flexibility Act, Executive Order 13272, and DOT Procedures and Policies F. Paperwork Reduction Act G. Regulatory Identifier Number (RIN) H. Unfunded Mandates Reform Act of 1995 I. Environmental Assessment J. Privacy Act K. International Trade Analysis L. National Technology Transfer and Advancement Act VI. List of Subjects I. Executive Summary
Affected entities Proposals • Division 1.4G consumer fireworks manufacturers complying with Part 173
• Division 1.4G consumer fireworks importers complying with Part 173
• Provide for alternative method to certify Division 1.4G consumer fireworks for transportation.
• Require retention of a record by certifying agencies, manufacturers and importers indicating a Division 1.4G consumer fireworks classification has been certified in a manner consistent with the proposed requirements.
To monetize the costs and benefits of the proposals in this NPRM, PHMSA used a number of assumptions to develop a base case. The overall costs and benefits of the proposals are dependent on the assumption that all affected entities are currently complying with the regulations and that 50 to 90 percent of applicants will choose a DOT-approved FCA to certify that Division 1.4G consumer fireworks complies with the American Pyrotechnics Association's (APA) Standard 87-1 (IBR, see § 171.7), in lieu of filing an approval application with PHMSA.1 We believe this alternative process will be attractive to the fireworks industry as it will expedite the transportation process without compromising the current level of safety, enable shipments of Division 1.4G consumer fireworks to reach the market in a more timely manner, and consequently provide a cost savings. Cost in this scenario, includes the cost attributed to shipments that are delayed while approval applications are pending with PHMSA.
1PHMSA based the percentage range (fifty to ninety percent) used in this rulemaking on the fact that over eighty percent of firework importers and manufacturers voluntarily participate in American Fireworks Standards Laboratory (AFSL) testing program to comply with the Consumer Product Safety Commission (CPSC) requirements. A range was chosen to demonstrate some level of uncertainty and to provide a tolerance for fluctuations in use of FCAs.
Costs associated with the proposals are primarily comprised of fees that FCAs may assess on manufacturers of Division 1.4G fireworks. There may also be costs associated with proposed recordkeeping requirements.2 Benefits will be derived from the expedited processing of consumer fireworks applications, resulting in faster time to market for each firework device. PHMSA estimates that the economic effects of this rulemaking, once finalized and adopted, will be sustained indefinitely. However, because of the difficulty of and uncertainty associated with forecasting industry effects into the far future, we assume a 10-year timeframe to outline, quantify, and monetize the costs and benefits of theproposals and to demonstrate the net effects of the proposals.
2PHMSA assumed that, absent relevant information on document retention practices of the fireworks industry, 50 percent of records will be stored in paper format and 50 percent of records will be stored in electronic format. Based on this assumption PHMSA estimated the record keeping cost to be approximately $610 per U.S. importer/manufacturer per year.
Annual Net Benefits Low redirected
application rate (50%)
High redirected application rate (90%) BENEFITS Expected Annual Private-Sector Benefits of Expedited Verification $14,680,000 $26,430,000 TOTAL ANNUAL BENEFITS 14,680,000 26,430,000 COSTS Record Retention Costs: Costs of 2 Additional Years of Paper Record Retention, All U.S. Importers per year 10,200 58,000 Cost for Required Electronic Storage Space, All U.S. Importers and Manufacturers per year Negligible Negligible Total Annual Record Retention Costs 10,200 58,000 FCA Processing Costs: Costs of application processing conducted by FCAs ** 3,937,500 7,087,500 Total Annual FCA Processing Costs 3,937,500 7,087,500 TOTAL ANNUAL COSTS 3,947,700 7,145,500 TOTAL ANNUAL NET BENEFITS 10,732,300 19,284,500
PHMSA estimates the 10-year present value of the net benefits is about $80 million to $143 million (discounted at a 3 percent rate) or $55 million to $98 million (discounted at a 7 percent rate). PHMSA concludes that the aggregate benefits justify the aggregate costs. A summary of the range of expected annual costs and benefits is provided in the table below.3
3Figures are rounded.
Annual Benefit ($2012) $14.5-26.5 million. Annual Cost ($2012) $4-7 million. Benefit-Cost Ratio 3.70-3.71. Net Benefit $11-19 million.
Section 173.56(j) requires that the firework device is manufactured in accordance with APA Standard 87-1 and passes a thermal stability test. An applicant requesting PHMSA approval based on § 173.56(j) submits an application that contains required information specified in APA Standard 87-1. For example, the standard requires that the size of the device, as well as the various formulas and weights of each type of chemical composition contained in the device must be specified in the application. Only formulas containing chemicals identified in APA Standard 87-1, Table of “Standard Fireworks Chemicals” can be approved under the provisions of APA Standard 87-1. PHMSA has expanded on the Table of “Standard Fireworks Chemicals” to further detail chemicals that are permitted and prohibited in consumer fireworks devices.4 The manufacturer must submit a signed application with a detailed diagram of the device and certify thatthe device complies with APA Standard 87-1.
4PHMSA's expanded list of permitted and prohibited chemicals for consumer fireworks devices can be found at the following URL:http://www.phmsa.dot.gov/staticfiles/PHMSA/DownloadableFiles/Hazmat/Regulations/Approved%20and%20Prohibited%20Fireworks%20Chemicals-02-21-2012.pdf.
After significant review of our fireworks program, we have identified areas that should be modified to decrease the delay in processing approvals. PHMSA is proposing to revise the HMR to provide an alternative option that will expedite the process for obtaining authorization to transport Division 1.4G consumer fireworks into and throughout the U.S., without compromising the current level of safety. PHMSA believes the revisions proposed in this NPRM will reduce burdens and enhance flexibility for the regulated community, while maintaining an equivalent level of safety provided in the HMR.5
5Over the past forty years, there have been 35 reported transportation incidents in the U.S. involving fireworks that were declared hazardous materials. During this same period, there has never been a death or major injury attributed to fireworks while in transportation when there was compliance with the regulations. While there have been two incidents that resulted in fatalities in that forty year period, both involved the improper setup or storage of display fireworks, and were not attributed to the transportation of Division 1.4G consumer fireworks. Detailed hazardous materials incident reports for hazardous materials incidents specified in § 171.16 may be found at the PHMSA Web site at the following URL:https://hazmatonline.phmsa.dot.gov/IncidentReportsSearch/Search.aspx.
Additionally, for each firework device certified and issued an FX number, the DOT-approved FCA that reviewed the application, the manufacturer, and the importer will be required to maintain the device's thermal stability test report and a copy of the application. Currently, most consumer fireworks manufactured or assembled in the U.S. and those imported into the U.S. are voluntarily tested to ensure that they comply with the Consumer Product Safety Commission (CPSC) requirements. The testing facility, the manufacturers, and the importers utilizing this voluntary process are required to maintain records of these tests for three years.6 As it is current industry practice for importers to maintain similar records under the CPSC requirements, there will be limited additional paperwork burden for importers. The DOT-approved FCA will also be required to maintain a copy of the certification procedures used for each device certified. We propose thatFCAs, manufacturers and importers maintain these records for a period of five years; however, PHMSA will maintain the records for up to 10 years consistent with current practices for other approvals. The Associate Administrator, or designated official, may inspect the DOT-approved FCA's facilities and records to verify compliance with the recordkeeping requirements, the HMR, and the FCA approval.
6Importers and domestic manufacturers participating in a voluntary program implemented by American Fireworks Standards Laboratory (AFSL) may use the test results obtained from AFSL to support certifications that the tested fireworks comply with all rules, bans, standards, or regulations applicable under the Consumer Product Safety Improvement Act of 2008. AFSL estimates that over 80% of U.S. importers and manufacturers currently utilize this voluntary program. All Participants in this voluntary program must maintain all records and documents for three (3) years from date of generation. Seehttp://www.afsl.org/images/Domestic_Certification_Program_Final_012511.pdf(last visited June 12, 2012).
EP30AU12.059 Alternative Process for Division 1.4G Consumer Fireworks
EP30AU12.060 EP30AU12.061 Reporting and Recordkeeping Requirements
This notice of proposed rulemaking (NPRM) is published under the authority of the Federal Hazardous Materials Transportation Law, 49 U.S.C. 5101et seq.Section 5103(b) authorizes the Secretary to prescribe regulations for the safe transportation, including security, of hazardous material in intrastate, interstate, and foreign commerce. This NPRM provides an alternative to the current process for approving Division 1.4G consumer fireworks more quickly and efficiently, without compromising safety. Furthermore, section 5120(b) authorizes the Secretary of Transportation to ensure that, to the extent practicable, regulations governing the transportation of hazardous materials in commerce are consistent with standards adopted by international authorities.
Executive Order 13563 is supplemental to and reaffirms the principles, structures, and definitions governing regulatory review that were established in Executive Order 12866 Regulatory Planning and Review of September 30, 1993. Executive Order 13563, issued January 18, 2011, notes that our nation's current regulatory system must not only protect public health, welfare, safety, and our environment but also promote economic growth, innovation, competitiveness, and job creation.7 Further, this executive order urges government agencies to consider regulatory approaches that reduce burdens and maintain flexibility and freedom of choice for the public. In addition, federal agencies are asked to periodically review existing significant regulations, retrospectively analyze rules that may be outmoded, ineffective, insufficient, or excessively burdensome, and modify, streamline, expand, or repeal regulatory requirements in accordance with what has been learned.
7Seehttp://www.whitehouse.gov/the-press-office/2011/01/18/improving-regulation-and-regulatory-review-executive-order.
Executive Order 13610, issued May 10, 2012, urges agencies to conduct retrospective analyses of existing rules to examine whether they remain justified and whether they should be modified or streamlined in light of changed circumstances, including the rise of new technologies.8
8Seehttp://www.gpo.gov/fdsys/pkg/FR-2012-05-14/pdf/2012-11798.pdf.
• Between 50 and 90 percent of applicants will choose to file a Division 1.4G consumer fireworks application with a DOT-approved FCA instead of filing an application with PHMSA.
• Domestic manufacturers and importers of Division 1.4G fireworks that participate in the voluntary CPSC Domestic Testing Program will choose certification by a DOT-approved FCA.
• The existing DOT-approved explosive test laboratories will likely apply for approval as a DOT-approved FCA.
• A 10-year timeframe to outline, quantify, and monetize the costs and benefits of the proposal and to demonstrate the net effects of the proposal
Annual Net Benefits9 Low redirected
High redirected
BENEFITS Expected Annual Private-Sector Benefits of Expedited Verification $14,680,000 $26,430,000 TOTAL ANNUAL BENEFITS 14,680,000 26,430,000 COSTS Record Retention Costs: Costs of 2 Additional Years of Paper Record Retention, All U.S. Importers per year 10,200 58,000 Cost for Required Electronic Storage Space, All U.S. Importers and Manufacturers per year Negligible Negligible Total Annual Record Retention Costs 10,200 58,000 FCA Processing Costs: Costs of application processing conducted by FCAs10 3,937,500 7,087,500 Total Annual FCA Processing Costs 3,937,500 7,087,500 TOTAL ANNUAL COSTS 3,947,700 7,145,500 TOTAL ANNUAL NET BENEFITS 10,732,300 19,284,500 C. Executive Order 13132
This proposed rulehas been analyzed in accordance with the principles and criteria contained in Executive Order 13132 (“Federalism”), and the President's memorandum on “Preemption” published in theFederal Registeron May 22, 2009 (74 FR 24693). This proposed rule will preempt State, local, and Indian tribe requirements but does not propose any regulation that has substantial direct effects on the States, the relationship between the national government and the States, or the distribution of power and responsibilities among the various levels of government. Therefore, the consultation and funding requirements of Executive Order 13132 do not apply.
9Figures are rounded.
10Cost calculated by multiplying the estimated cost of $700 per application by number of Division 1.4G consumer firework applications redirected to an FCA (i.e. for 50% redirected 5,625 × $700 and for 90%.
Federal hazardous materials transportation law provides at § 5125(b)(2) that, if DOT issues a regulation concerning any of the covered subjects, DOT must determine and publish in theFederal Registerthe effective date of Federal preemption. The effective date may not be earlier than the 90th day following the date of issuance of the final rule and not later than two years after the date of issuance. PHMSA has determined that the effective date of Federal preemption forthese requirements will be one year from the date of publication of a final rule in theFederal Register.
The Regulatory Flexibility Act (5 U.S.C. 601et seq.) requires an agency to review regulations to assess their impact on small entities unless the agency determines that a rule is not expected to have a significant impact on a substantial number of small entities. The total number of U.S. importers that are expected to be impacted by the proposed rulemaking is estimated to be between 62 and 206. PHMSA chose to use a range to reflect an uncertainty in the number of U.S. importers. This uncertainty is a result of the high turnover in the fireworks industry resulting in large year-to-year fluctuations in the number of importers. This range is a result of combining estimated import data with data provided by a consumer fireworks trade association. The figure of 62 was derived from import data obtained from a publically available business directory and PHMSA's approvals database; while the figure of 206 was derived from statistics provided by AFSL, a consumer fireworks trade association. Specifically, the figure of 206 is derived from the AFSL Consumer Fireworks Membership list that shows 175 members. AFSL claims to represent 85 percent of all U.S. consumer fireworks importers in the U.S., therefore, we calculated a total of 206 (175/.85 = 206). PHMSA believes the actual number of U.S. importers lies somewhere between 62 and 206. PHMSA estimates the number of U.S. manufacturers to be five, based on the number of hazmat registrants. This results in a range from 67 to 211 U.S. manufacturers and importers. PHMSA seeks comment specifically on the accuracy of these numbers.
OMB Control No. 2137-0557: Increase in Annual Number of Respondents:211. Increase in Annual Responses:5,175. Increase in Annual Burden Hours:430. Increase in Annual Burden Costs:$14,875.
Address written comments to the Dockets Unit as identified in theADDRESSESsection of this rulemaking. We must receive comments regarding information collection burdens prior to the close of the comment period identified in theDATESsection of thisrulemaking. In addition, you may submit comments specifically related to the information collection burden to the PHMSA Desk Officer, Office of Management and Budget, at fax number (202) 395-6974.
Under E.O. 13609, agencies must consider whether the impacts associated with significant variations between domestic and international regulatory approaches are unnecessary or may impair the ability of American business to export and compete internationally. In meeting shared challenges involving health, safety, labor, security, environmental, and other issues, international regulatory cooperation