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respond or the existing firms respond is greatly affected
by the form of the regulation.
If you ban a product, it is an invitation to new
entrants. If you restrict the amount of an impurity that
a solvent contains, it might be much less inviting to a
new entrant.
If your concern is with the occupational safety
and health of the worker, then that invites a process change
rather than a product change in general.
So the form of the regulation, the time frame, the
stringency, all of these things, and we have historical
data to back this up, that this is not just kind of
loose-talk,- the form .-of the-:regulation can -greatly" affect
the technological response you expect and the particular kind
of innovation that you expect.
In my view, I think the greatest mileage to be
made by environmental agencies in general is to pay more
close attention to the technology that they are regulating
o
and have technological, engineering, chemical input into
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the response that they expect rather than merely paying
attention to the biological effects of exposure.
That has been the major scientific investment
by the agencies where they have made them, but they have
mace very little investment in responses. I am talking about
25 !..,._.
;j a SKIT, c new me nrm responcs to create a new croauct.
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This report goes, I hope, some distance in
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identifying those policies and those incentive systems that
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EPA might adopt in order to stimulate the firms to buy as the
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response in the direction which is profitable for all
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concerned or cost minimizing for those adversely affected.
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MR. LENTZ: Are you going to get into your
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methodology at all?
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DR. ASHFORD: The methodology, in fact, is clearly
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laid out in well, there are two methodologies. I might
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as well do it now.
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One methodology is how do we get the list of
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32 and the second is how do we conclude that those seven1
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.... . .-look attractive-. -.; :We ..got -the.' li-st -of 32 from: every, possible
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source possible.
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We did our own thinking, we talked to EPA, industry !
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people, things that have been buzzing around for a long time.
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What is it you can do to minimize what burdens might be put
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on an investment firm investing in the technology.
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Of course, we looked at the experience in the
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pharmaceutical industry, especially vis-a-vis testing, which
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is some parallel. We looked at the experience that we had
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uncovered by a statistically significant survev of chemical
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firms subjected to all kinds of regulation in a different
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studv cf the National Science Foundation.
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I am not aware of anything that we left cut in the
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32. I don't know of a single I would be willing to hear
that we left an important one out, but I think that just
3 about covers the lot.
4 How did we choose the seven that we thought were
particularly attractive?
That process was an internal process to our staff.
We, ourselves, from the general experience that we have had
a
in the regulation area, innovation area, which is considerable
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we individually rated these programs according to six or
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seven criteria and the criteria are carefully delineated
in the report.
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And did a weighting system and a concensus of what
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the .highest weighting .policies were. I am sure that a
different group of people, taking those 32, might come
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might come to a different conclusion, and,, in fact, we were
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careful, I think EPA was carefulto say that our choice
of seven might not necessarily be their choice of seven,
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for a lot of reasons, and some very unknown issues are
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political acceptability, the general state of the economy
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and other things.
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It is just somewhat encouraging to me that the
feedback that we have received from industry folks and others
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on this has not raised any obvious omissions of what might
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be a very attractive set of oolicies.
«:
We chose a set or six or seven, no single policy,
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Y
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all of which do somethingM.ifferent to the incentive to
break the market, and other policies, which have different
forms address some of the same incentive systems, but we
thought with less success.
I don't think any of us are so confident about the
relative importance of these policies as to put our
professional reputation on it, but what is important in
this process is to start.
That is, I think it is important if the area is
viewed to be a serious one, that is, if we are convinced,
and I am not necessarily convinced, but if we are
convinced that there is a significant hampering,
..technological change, which .is :not, .to^-be -expected /and. .which; ....
is not justified by the corresponding improvement in health
and safety, we think we are paying too much for the
whistle, then we can start, we can start experimentation on
a small term basis to see if these policies work and what
the industrial response is.
Of course, some firms will like the policies
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and some will not, but industry is not monolithic, its
innovative capacity is not monolithic, and the chemical
industry is not an industry, it is a collection of very,
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So we have to be segment specific, we h-ave to fine tune
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policies, we have to be careful about our choices, and I
would be fooling you if I told you we could go on another
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contract for EPA and do a computer modelling of 497 factors
which would be able to.predict with particularity what the
successes of these policies are.
I think there is no substitute for trial
experimentation or looking very carefully at places where
a
parts of these programs may have worked in the past, in
g
foreign countries with regard to specific elements that may
have been instituted here.
T think that is a black art and we hope that we
have contributed.something to the discussion which could
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serve at .least as a reference point for agreement,.. dis- .
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agreement or trial.
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That is a long-winded way of answering your
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question. In so doing I have cut out about four things I
wanted to say.
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Another word on innovation before I get
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specifically into these programs. One is that you can think
20
about two kinds of innovation, aside from the fact that
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process and product are the base you might be distinguishing,
two kinds of innovation from the perspective of the firm.
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One kind is what we have termed innovation for main
business purposes.
-5 i| ...
j Tnat is tne business the cnemical industry has been
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in, producing products which have utilities for the
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consumer and society. It is a function it serves and it
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has driven this innovation, it is driven by a combination of i
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two market stimuli.
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One is the recognition of market needs, there is
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a need for a new catalyst or a need for a catalyst that will
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allow a lower energy content to be used in a product.
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That is a good example, because the energy
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feedstock and feedstock cost changes have increased the
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demand for more efficient conversion of materials.
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The recognition that there is a need for a
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new catalyst drives the firm when it conducts its main
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,. business.innovation, to .-product, thos-e;. productsi;:-;-:-; "; -'.: -. ." .
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The second kind of innovation stimulus emerges
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from what the scholars call technology push. You have a
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product, can you find it useful for some other purpose.
IT
It turns out that the Dow silicone people have had the
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silicones around for a long time and they recognize that it
19
could be used in the context of transformers, as a trans-
20
former fluid replacement, because it had certain property.
21
They searched for and found a need for their
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product. And, of course, what they look for is very often
23
| determined by the technology, the know-how of the products
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they produce in-house. That is main business innovation
and the major question is, has the name of that main
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business activity going to change as a result of TSCA
regulations, and if so, how do we get it not to change more
than it needs to or offset any losses of good products to
the consumer and industrial user.
The second kind of innovation has to do with
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innovation for compliance purposes for regulation in
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general. And that is if, in fact, we are going to ban
benzidene dyes, then what needs to happen is a product needs
to emerge, not as a better dye, but as a safer dye that is
as good as benzidene.
In fact, it turns out that is an interesting
story, that there are better dyes and safer dyes already
produced, but the general .inertia of changing products
in the market, because firms' are not, in fact, at their
optimum production efficiency ever, it turns out to have
been an unnecessary production of products in certain uses.
DR. MOSES: In terms of the benzidene dyes, are
you talking about that use as well as production?
DR. ASHFORD: I am saying that for certain uses
there are better and safer dyes than benzidene and have
been for some time.
DR. MOSES: My question is a different question.
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Are you talking about use? Are you saying that, okay,
nobody is manufacturing benzidene dyes in the United States
certainly a lot of them are being imported and
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used?
Does that come under the purview of what you are
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talking about? Are you talking about not allowing anybody
to import and use products?
That doesn't have anything to do with the toxic
substances. We are just talking about new products and
products being manufactured domestically, right?
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DR. ASHFORD: I am not saying it has to do with
9
toxic substance control, per se, except that the act itself
10
has formed a basis for the non-use of benzidene dyes or will
11
There is a regulatory stimulus that now demands that some
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compliance with a health concern occur.
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DR. MOSES: I understand that. That is why I am
saying when you have it and you still have benzidene dyes
15
coming into the country and workers exposed to them, I
16
want to make sure I understand what you are talking about
17
in terms of policy, that is all.
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DR. ASHFORD: Importers are regulated under TSCA.
19
You don't need to be a producer.
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DR. MOSES: I know. I want to know if that is
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incorporated in what you are talking' about in terms of
policy, also the import that is all.
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DR. ASHFORD: I guess if I understand the thrust
of your question, I think you are implying that we have
dealt in this report with a much broader set of policy
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questions than we are.
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I am talking about those policy questions, but
that is not what the report and the study went to. The
reason I am starting broad is, I think, to appreciate what
this means it is as important to understand the problems that
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it doesn't address as the problems it does address.
PROF. BARAM: Is this similar to trying to determine
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what the total impact of regulation was on the well being and
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growth of the industry?
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DR. ASHFORD: Not. at all. We are not predicting
what the effects of TSCA will be on innovation. We have
talked about how firms innovate for main business purposes
and what things affect that investment decision and then
saying if anyone of those factors are affected, like venture
capital or the skill mix or the requirement to test for
health and safety of chemicals, what could the government do
to offset the non-production of products that we as a
society would otherwise want, without asking the question what
is the likely impact.
In fact, we make the .statement, I don't think you
can predict the impact and anybody who attempts to
predict the impact doesn't understand the area, frankly,
because the data that exist show a combination of effects.
You can stimulate main business innovation, you
ii can retard it or vcu can redirect it and all three of those
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things occur, and the magnitude of the effect in terms of
the regulation, its timing, the regulated segment and its
innovated capability, anybody who would generalize and
do a study, in my view, the study is not worth the price of
the paper it is printed on, because I know what we know,
and what we know demands a very specific investigation.
We are not predicting dilatorious effects of TSCA
8 on innovation, but we are saying mechanistically you might
9 expect some,
These are the kinds of things that might occur
11 and these are the kinds of things you can use to offset those
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dilatorious effects should you desire to do so. That is a
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good -question, .but we are .not. predicting/--...-... ^ . .-,.'
4 PROF. BARAM: In designing these policy options and
0 choosing them, I guess it was an attempt to make surethat
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whatever happened in the chemical industry would be
consistent with TSCA's purposes.
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DR. ASHFORD: Absolutely. There is no attempt to
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do a cost benefit analysis of where safety and utility
balance off. That is not our job. It is EPA's job,
because what constitutes an unnecessary hampering of
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technological innovation eventually will fold into the
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concept of what an unreasonable risk is, the dividing line
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between unreasonable risk and reasonable risk as you know for ;
regulatory purposes asks the question, is it worth paying the
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price we are paying.
PROF. BARAM: Let's say we are talking about
tax incentives, industry to do better testing in the chemical
innovation process. Presumably, then, your recommendations
for tax incentives would relate to health and safety
testing but not marketability of the product, and the market
for the product out there.
DR. ASHFORD: You have picked a bad example, and
the reason is because the last thing in the world we
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tax incentive as a device. Let's just assume that it is a
possible device. How would you approach it?
DR. ASHFORD: The point is it is quite possible
that you would be better off giving a tax incentive to do
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recommend would be blanket tax incentives for anything.
PROF. 3ARAM: If you did. Use it as an example.
DR. ASHFORD: Let me make a statement and then
I will try to answer the question.
The -reason we doh:'t choose the policy and the
reason I have a hard time answering the question is because
macro economic policies which generally decrease the
financial burden on the firm aren't necessarily going to get
you more innovation.
You have to specifically target. If you give the
c;
tax
PROF. BARAM: Let's not get into the merits of the j
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something which had nothing to do with health and safety to
produce better products than actually deducting the health
and safety.
I can't answer the question because I haven't
studied the problem, but I am sure I would never recommend
6 that blanket ~
PROF. BARAM: It is possible that it would seem to
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go beyond the mandate of TSCA. The mandate of TSCA would be
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limited to tax incentive pushes, let's say. And only to the
extent that it dealt with health and safety, I would think
DR. ASHFORD: We did not limit ourselves to TSCA
authority, because I think it is important that this
effort be coordinated ''through' section 9 or 'anything else
with other agencies generally, and number two, if it
means that we need to have a change in the industrial
policy towards the chemical industry that comes out of EPA,
not from EPA, but outside of EPA, then I think EPA could very
well want to recommend to the president or to the IRS or
anybody else different changes in structure.
Yes, you have a mandate for health and safety and
for not unduly impairing technological innovation, but when
| you use those words you are already intervening in commercial j
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.extra TSCA innovations.
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MS. SMALLWOOD: I want to make sure I understand,
This is an exercise in thoroughly going through
the state of the art of innovation in this area, and
sifting out or defining out a list of policies that
could be considered clearly within the purview of TSCA as
well as outside?
8
DR. ASHFORD: Yes.
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all that has happened?
DR. ASHFORD: That is right. That is all.
MS. SMALLWOOD: That is why I was asking you about
the..policy question in the..beginning, ..were .these ,in the... ....
statute or not. That you have done a literature search,
individual discussions, interviews and what have you.
So it is a culmination of potential policies
on the state of the art?
DR. ASHFORD: . In my view, it is the best state of
the art I don't know how to have gotten a better descrip-
tion of where we are today than doing what we did. It was
based on a tremendous amount of experience gained outside of
this contract.
It involved all the affected segments, and while
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people can disagree with our views and should. I don't know
what more intelligence to add to this except a few things I
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might say about a study we are doing about effects of
regulation on the pharmaceutical industry.
MS. SMALLWOOD: My criticism is it doesn't come
across very clearly that that is all this is because people
get into these other things that she and he are getting into.
It is clearly an enumeration of potential policy decisions
that could be taken?
DR. ASHFORD: Yes.
MS. SMALLWOOD: Period. End of report?
DR. ASHFORD: Yes.
MS. KINNEY: I think that is clear in the report.
DR. ASHFORD: I think it is clear. The executive
summary, which I re-read this morning for the 30th time
PROF. BARAM: I haven't read the report, but
obviously you had some criteria.
DR. ASHFORD: There is an internal ranking
I was asked how we chose these policiesn that reflect .our
staff's not EPA's position, not anyone else's positi9n,
but the criteria we used to weight are there for you to see.
You can take the 32 options and do you own weighting and
decide that you want a different list of six or seven and you
might say, look, there should be an anti-report.
MS. KINNEY: Back to something you raised earlier,
I one of the criteria they used is how consistent the
I re'coronencaticn is with the policy goals of the toxic
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substances act also, which was a primary criterion.
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DR. ASHFORD: Since you raised the question,
3
the criteria for evaluation probably ought to be locked at.
4
PROF. BARAM: You have to assume that no one has
5
really read this.
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MS. SMALLWOOD: The criteria is just listed in the
7
executive summary. It is hot delineated as to what they mean.
3
That was the next thing I was going to get into.
9
On page 15 in the text, and it is 1-8 at the top.
10
I guess that has a meaning.
11
DR. ASHFORD: There we go. Yes. There were nine
12
criteria. Capacity to countervail its effectiveness as a
.13 .. .. -.. ....-, :-.-.-...- :-, ":':'. .'.::...;..';.".;-'. .,-:'.,.// =: '..,>. ...-:,-
" 'technical measure.' "" '
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MS. SMALLWOOD: Ten of you text.
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DR. ASHFORD: Private costs, public costs,
16
supportive of TSCA's aids. We found that we, of course,
17
considered that that was paramount.
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MS. SMALLWOOD: Tell me where that is in the
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text.
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DR. ASHFORD: I think chapter IV.
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MS. SMALLWOOD: _ Is the business at the top relating
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to the chapter?
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DR. ASHFORD: Chapter V.
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1| MS. SMALLWOOD: The numbers at the top, does that
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DR. ASHFORD: Yes. Starting on page 5-1, the
choice .of the criteria and in some detail, really, we didn't
want to leave anything out, so in some detail we showed you
how we, in fact, ended up doing this.
Criteria for assessment on the first page of
page 5, chapter V, page 102 at the bottom. We can have two
kinds of discussion here.
One is what were the criteria for weighting or
another kind of discussion, which is given any set that you
might want to come up with or EPA subsequently come up with,
what is the best way to implement this program to get it
moving, because ultimately these are projects based on our
'own judgments anyway, ours' or yours, and we are hot going
to know, we are not going to know unless we look at new
evidence of existing programs if there are some or we
start the process.
MS. KINNEY: I would suggest that we spend a
relatively short time on the criteria, because it is set
out in the report.
DR. ASHFORD: Each one is detailed.
'MS. KINNEY: That is right.
I think it would be much more useful to us to go j
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into the other discussion, that is, how EPA goes about setting
in motion these or other recommendations, not necessarily
these, not confined to these. :
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MS. SMALLWOOD: I would like, to hear ""the
clarification of the conclusion. I read it several times,
and I am not sure what it was concluding.
DR. ASHFORD: What the report concludes?
MS. SMALLWOOD.: Yes. I am not trying to be picky.
Policy formation is a particular area of my training and so
I was most intrigued by the methodologies and I had
8
difficulty determining whether you said do a small one or not
9
do one.
Look at your conclusion in the executive-summary.
DR. MOSES:' 118, page 25.
MS. SMALLWOOD: Tell me what that says.
DR. MOSES: There are a lot of "mays" and not
necessarily
DR. ASHFORD: I think what that really says is that!
{
the program that can begin to test these ideas out need not
be large, number one, that you need directive programs that
are specific, not mass relief like tax incentives, and that
regulatory exemptions, which is a way out of part of the
pressure put upon EPA, is not necessarily indicated or
exempting small firms, that these are not the policies that
we are focusing on. _
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MS. SMALLWOOD: Then what is it your are
recommending? Either cf those six?
DR. ASHFORD: :Tot either, the v/hole "ackace.
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Of the seven, choose six of the seven. |
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MS. SALONIK: I was the project manager for this j
and I wanted to add one thing. I think one of the true
4
purposes of this, rather than they were very careful not
to be too strong in their recommendation for any of these
because the first half of the report shows that they are
not at all sure how serious the impact on innovation is going
to be.
I think perhaps the true conclusion and purpose
of the report is to stimulate discussion, which indeed is
exactly what is happening here.
DR. ASHFORD: We have chosen seven policies that
we thought had a chance of meeting the criteria we articulate.
It turns out that you can do two of them you have to
choose between. You either give grants, which is a freebie,
or you give a loan, which is a different incentive system.
You don't do both or you don't give both to the
same firm. Those address different incentives that might be
given by TSCA.
It isn't a matter of trying one of the six, it is
a matter of trying them all in complimentarily designed
program.
We did not say you should have 20 percent of
'I option one, 30 percent 'of option two, st cetera. That is not
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I think the way one would choose it would
probadly different depending on the sector you are trying to
stimulate. If you are concerned about innovation in
the polymer industry, you might come up with a
different recommendation than innovation in fine chemicals.
So it is up to EPA whether it wants to implement
an such a program, and your advice should be factored into
what you think about this approach. The alternative is to
do nothing or to fall back on what I think is a totally
inappropriate government response, let's just give money
away, let's just reduce the economic burden on industry.
I don't think that is going to be very much of a
.payoff'.for- industry 'itself..' -I-doh-'t think' you-: are"-going'-tb :
stimulate new technology, I don't think you are going to get
its business in better long term operation, and I certainly
don't think it benefits anybody.
These kind of macro approaches won't work.
DR. MOSES: In the interim, you were just saying,
what do you do in the meantime. Are there any attempts
being made now to realistically,.not with stereotypical
views with one person saying industry isn't doing enough and
industry saying we will have to go out of .business, are
there attempts to try to assess what the economic impact is
or tc try to find a way of establishing not necessarily
policy criteria, but a>ay that the company can actually
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1 report what it actually is costing them to implement TSCA
2 or whatever. I have never seen anything like that except for
3 a few industries.
DR. ASHFORD: Industry has sponsored a projected
effect of TSCA on itself, and I just want to tell you that
DR. MOSES: But is it realistic?
DR. ASHFORD: No.
DR. MOSES: It is like the vinylchloride people.
9 DR. ASHFORD: It makes methodological errors.
10 DR. MOSES: Then how do you do it?
11 DR. ASHFORD: Why do it?
12 DR. MOSES: Because we don't really know what the
13 impact, is. Is there a way to start,getting at it?
14 MS. NELSON: I am going to talk about some of the
10 other things that the Office of Toxic Substances is doing to
16 look at innovation later on as well as the idea of what are
we doing with these particular options.
18 Maybe we should just put it off until my discussion
19 and you can ask it again if I don't answer it.
-° DR. MOSES: I think it is really important in
terms of what is in this document here. If you give up and
say we are never really going to be able to find it out, we
will never know what the cost is, we will never know whether
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industry, is..pulling the"wool over our eyes or whether they
have these costs, how can we know the truth of the matter?
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DR. ASHFORD: The issue is not the cost to industry]
The issue is its effect on innovation.
That is not the same. Because the costs of
internalizing the effects of consumer health reduction,
risk reduction, is going to end up increasing somebody's
accounting sheet, in some cases a transfer from consumer
health bills to the corporater ledger.
I am not going to sit as arbitratory of whether
that is good or bad. The fact that these things may cost
money is uncontroverted.
There may be rewards, but that is a subject that
has received a lot of debate. The important thing to begin
to talk about is what effects this is going to have on new
product development, because number one, that is what 2 (.b) 3
in the act is about, and number two, you can't even begin
to ask what the economic effects are unless you address that
question.
That is the first thing. If all you want to do
is calculate what the testing costs are going to be
DR. MOSES: I didn't say calculate what the
testing effects are going to be.
DR. ASHFORD: I am saying one cannot get a very
good feeling about what the economic impact is. When you
say what the effect of TSCA is, what is TSCA.
ii
il
;| How many regulatory signals has TSCA in fact been
{i
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34 ,
responsible for putting out to even measure three, four?
DR. MOSES: Very few.
DR. ASHFORD: You don't have a chance in hell of
answering the question on an emperical basis yet. The
difficulty of cost equation, we do not yet have a
6
requirement that tests be performed by industry.
TSCA has not mandated that and yet industry
8
routinely tests chemicals through the Bruce Ames mechanism
9
voluntarily.
Is that a cost that should be attributed to TSCA
or is it something that would have been taken in any event
because they don't want their product regulatd by OSHA
In the future'or subject to the products liability suits.
The experience in the pharmaceutical industry is
that a lot of the testing would' have been undertaken anyway,
'regardless of the Keffaufer-Harrison amendment.
We are in a transition period between a time of
no regulation and a .future time when the mechanism for
industrial production will be played by a different set of
rules.
This transition period is painful and it is old
technology, it is going to be redesigned in terms of plants
and uses for new products that will come.
j
I don't thin::, it is fair to ask what the impacts
of TSCA or any other regulation are in terms of the painful
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o
If you focus on that the benefit to cost ratio
3
10
11
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,13
14
15
16
4 industry be in 10 or 5 years, that is a more relevant
question, and a question which the chemical industry is
concerned with.
All this report seeks to do is ask the question,
a
what will, the availability and production of new chemical
Q
processes that meet consumer and industrial needs not
18
19
20
21
22
23
24
25
transition period.
doesn't look good. If you ask what will the cost to
what will the effect be, but if there is an effect, what
programs could be undertaken to offset them.
You may decide nothing should be done or we may
decide to embark on some specific integrated programs. That
Is stated clearly in the executive 'summary, of the six or
seven policies delineated, some things are being done.
Generic P&M rules are being effected. The fast
track P&M is not something official, but that we know occurs.
That is one of the policies that is recommended, get an
accelerated look at the options.
So EPA already is adopting, but not in a
coordinated way, not with the idea of focusing on innovation,
but with the idea of generally accomodating industry
interests.
So this is not a paper study which has not basis
j in fact. Seine of these things are being tried and their ;
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success may be evaluated on emperical evidence in a narrow
area.
3
MS. SMALLWOOD: Originally the difficulty for
4
me was that this requires that you isolate out all the other
things of the reasons why we are here and say what if a
policy was directed toward increasing innovation or making sure
that TSCA doesn't deny innovation, period, end of report,
8
don't think about anything else, focus on that.
9
And I think that is at least, that is the
10
difficulty that I have.
11
DR. ASHFORD: The reason I started out broadly
12
in my discussion this morning was because I anticipated that
13
question.
''" "' ' .'
MS. SMALLWOOD: I think that screwed us up even
15
more, going very broadly.
16 !
MS. KINNEY: Let's not discuss whether we should
17
have started one way or the other.
18
DR. ASHFORD: I started out by saying to you that
19
innovation could be uced for two solely different purposes,
20
one, to put it crudely, of interest to the stockholders and
21
second of interest to the environmental health specialists.
DR. MOSES: We do have some common interests,
23
then.
24
.DR. ASHFORD: Even I recognize that. If the
""
oolicies that mav stimulate innovation could x-erv well be
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designed to stimulate safer products, and the trick of this
agency is not to trade off health and economics, but to
guide industry so that the best technological response from
its perspective also produces the kind of technology that
benefits the consumer and worker.
Let me make a statement the often-created
image about environmental regulation having gotten rid of
90 percent of the problems and now we are on that difficult
fast rising diminishing return curve so that it isn't
10 worth it to clean it up is not what regulation of these
11 chemicals is all about.
12 Most things are not regulated. We can have our .
13 ..cake, and eat.it for:a,-very long 'time.. . We: want :.to-.'propose.- '
14 innovation that meets the health golas first and end up
15 being attractive for a commercial investment because who
16 is going to produce the chemicals the chemical industry.-
17 Let's make it of benefit to them to be socially
18 responsible. And I think it can be done.
19 MR. BRAITMAYER: Why were none of your top choices
some incentive to encourage that?
21 I mean that was my complete problem with this
00
report, is that that is obviously the issue, and if the
03 I
" ! EAP via TSCA wants to encourage safer chemicals, there are all
" ' kinds of ways of stimulating that, but they are way down the
list.
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DR. ASHFORD: From the point of view of the firm,
it doesn't care how it makes money in a sense, if it produces
3
a safer furniture polish or that is commerically successful
4
or a commercial successful transformer fluid, other things
being equal, it really doesn't care.
The choice about which industries to target using
this collection of policies is where that choice comes in.
If you decide that we need safeer furniture polishes and that
9
there is really harm to the consumer, then the area in which
10
you decide to give the loans or to stimulate innovation is
11
precisely the area where you want those products substituted.
12
And so the judicious choice of the industrial
13
segment that you target, will, factor .in., the -prime ....-.
14
environmental concern. The sets of policies that you
15
choose, while industry specific, aren't going to have
16
labelled on it this is a policy for safety of products.
17
It is a policy for new products, and if you want
18
them to be safer you make sure they go to the kind of
19
innovative firms that produce safe products, not the ones
20
that don't.
21
So that is where the choice comes in.
00
MR. BRAITMAYER: Are you implying that EPA could
23
make that choice or should make that choice? EPA is going
24
to be a judge of what company is going to be the most
innovative?
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1 \.pR. ASHFORD: I am saying if you want anything
2 other than either nothing, which means let things go as they
3 are, or a general macro economic policy across the board/
4 you are going to have to play god a little bit.
0 The_ answer to your question is yes. EPA, through
6 its judicious choice of where these spoils end up distributed,
7 will end up restructuring the rules of the game in a particular
8 industrial segment.
There is a lot of heat to take on that because
the winners will be happy and probably say nothing, and the
losers are going to scream.
12
This is not the first time this has happened.
13
Gasoline ..stations were..riotregulated -.by .,0'SHA-on.;.the . ., . : . .
14
benzene standard. Anytime that people have a competitive
advantage and you restructure the competitive nature of
industry, somebody will scream.
Let me suggest that somebody is going to win,
18
too, and it is in industry's interest, those that may be the
19
winners, and many may be the winners in fact, a great deal
20
may be the winners if you take into account not the
21
internal competition that we are talking about, but
22
regain the loss that we have had to the German chemical'
industry in international markets.
We are losinc international markets because
i
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things are not innovative, per se, in the chemical industry.
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You can have your cake and eat it for awhile if you are
careful. .If you object to government distorting the market
in this way, then this is just. one program that you can
object to, because there are millions of them.
MR. BRAITMAYER: I think basically, though, the
question here as I see it is if they decide that there are
certain areas that they are looking for in improved chemicals,
when maybe I misconstrued your comment.
I got the impression that you were more or less
promoting the idea of giving grants to specific firms to do
this. I am saying we should identify areas that the
government agrees that they want to see an improved chemical.
.Who. doesn rt;- shouldn't be the ... government -'.s .function?:-.. . . ... ... .
DR. ASHFORD: I am not advocating that particular
program. Let's take the fast track option. EPA's Pl-IN
office .could adopt a policy which says we are going to look
at the 200 P&M's and take these 25 and push them through
quickly.
The FDA does this all the time. It is not a new
thing to government.
The 475 that don't get expedited approval are
going to be pretty angry. The hard question is, should EPA
do that, should it play favorites?
MR. 3RAITMAYSR: The Patent does it.
DR. ASHFORD: If you o back and ask people
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fundamentally, if you ask industry off the record and
individually, do you want a system that will recognize
the real attractiveness from a consumer perspective of a
product, and within the 10 PMN's you apply, do you want us to
tell us which ones to promote, do you.want us to exercise
6 our judgment and say we are going to benefit you wherever we
7 can?
8 The answer will be, yes, unless you believe you
9 are not producing innovative products, unless you believe that
10 what you are producing a "me, too" chemical. If someone
11 else is producing a "me, too" chemical, maybe industry
12 would benefit by not producing a "me, too" chemical.
13 -There is no such thing as a chemical industry.
14 The industry itself is made up of many very different kinds of
15 firms, such as packagers. I don't know how to answer the
16 question when you play favorites. ,
\
17 MR. BRAITMAYER: You can set an objective and then
18 the industry will do the rest of it as long as the incentives
19 are there. If you say we want to come up with a much safer
20 transformer fluid, and if there will be some clear cut tax
advantage to the ones that can do this
oo
DR. ASHFORD: Let the ones come forward?
MR. BRAITMAYER: They will. We will say there is
74
a tax advantage to actually meeting that performance. If
that car. be calculated into your R&D calculations on what
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\
kind of areas you want to work on, then you don't have to do'
anything else. Because people are looking for those
3
advantages and the markets that are going to be developed
4
because it is a safer product.
DR. ASHFORD: What about the people whose
substitutes will get thrown off the market?
How will they respond?
MR. BKAITMAYER: That happens to all of us. We
9
are all in a competitive business and .we don't all have
10
you know, I am going monopolies. They just aren't
11
DR. ASHFORD: I don't know if I want to get into
12
an argument of whether you have monopolies or not. The
13
largest in the product and the name of a product, brand is a
14
fairly difficult thing and increasingly difficult thing to
15
penetrate.
16
There may not be collusion, but I think there are
17
monopolies. These are difficult questions.
18
MR. BRAITMAYER: I would like to find a market that
19
I can get into that is as you describe it.
20
MS. KINNEY: No, you want to be there right now.
21
You don't want to be trying to get into it.
DR. ASHFORD: If these policies can translate your
i
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good technological superiority into profit for you and into a I
i
market share which vou deserve because vou have the . :
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reduce the barriers to entrants, then you will be successful. 1
|
For those that have taken advantage of friction j
in the system and an inappropriate set of incentives., they
will be unhappy.
MR. BRAITMAYER: Aren't we talking about
innovation stimulating innovation?
DR. ASHFORD: Yes.
MR. BRAITMAYER: The way TSCA is structured,
evertying is a penalty from the industry standpoint. The
environmental advantages are being achieved at a cost.
I am saying, okay, let's offset some of this
cost and make it attractive to get innovation going again.
DR. ASHFORD: That is the purpose of these policy
options' exactly. That is'exactly what'this report addresses.
MS. KINNEY: What Jack is saying is that he would
disagree with the rankings you have made on your recommended
policies.
MR. BRAITMAYER: There are simpler ways at no
cost to the government.
DR. ASHFORD: What are they?
MR. BRAITMAYER: No, basically to set a policy
to pick out those things that you in a priority, stance
that you are willing to fast track and if maybe there would
be some effort working with other branches of the government .
j to get ta;-: incentives through to acr.ive these goals?
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DR. ASHFORD: Tax incentives to do what?
MR. BRAITMAYER: To come up with less toxic
compounds in areas where we have problems.
DR. ASHFORD: Tax incentives to produce a safer,
for example, furniture polish, if that was a problem area,
rather than
MR. BRAITMAYER: Right. If the Government is
making selective choices of areas that they deem to be the
most critical. You know what we are trying to do, so to
control only those that are high risk materials that is
the intent of the law, right?
It says some chemicals are high risk. It doesn't
say all.of .them.' UnreasonableI'risk'.-- .'' ' "-'.' "''' '. ' " '
DR. ASHFORD: There are two areas of concern.
One is to encourage innovation in order to come up with
substitutes for very harmful products, and that is important.
The second is to make sure that whatever gets invented and
then finally brought to market as an innovation, which is not
a substitute, is, in fact, not harmful, and we want to make
sure that however we make the difficult determination of
unreasonable risk, that the best kind of production
efficiencies and profit can occur to the firm in order that
03 |i
" " those things get mace in that direction.
I am not against you. I am with you. But I am
|! saying you have to be selective.
9
10
11
12
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14
15
16
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19
20
21
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45
You say you disagree with the set of policy
options. I heard you, but I wouldn't have concluded that
you disagreed.
MR. BRAITMAYER: You talk about the top seven, and
I go down to 19, which is one I would like to see much higher
on the list.
PROF. BARAM: Did you go out to industry to
8 determine which of these incentives would be most
9 desirable for the small or large firm? j
10 DR. ASHFORD: We did not go out to industry to
11 ask the rankings. Number 19 is increased capital availability
12 for chemical development via tax changes or via SEC rules.
13 . "; The -.reasons for -no't choos'ihg that, I: -'think, ''are:'
14 in the report, but the points is it is to give a tax
15 advantage to a specific area may be a very difficult thing
16 to get by politically, a very difficult thing to get by
17 politically.
18 It is much easier to fast track PMN's than to chang
19 the tax laws for a specific industry. That is why that
20 policy option is not higher.
If you want to lobby for that, then you can't go
00
to EPA to lobby for that, you better go to the president
directly and you better go to stockmen directly and you
better see if you can get that through, and I bet you you
-5 can't.
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I agree from a mechanistic point of view, could
you get a tax break for specific lines that you want to
encourage, that is excellent.
MR. BRAITMAYER: Just say the R&D costs.
DR. ASHFORD: I don't think it will fly. I
think it will work, but I don't think it will happen. . .
PROF. BARAM: But that wasn't one of your criteria
8 in ranking these?
9 DR. ASHFORD: It certainly was. Absolutely.
10 That is why
11 DR. MOSES: That is trying to be realistic.
12 DR. ASHFORD: This is not an academic study.
13 PROF. BARAM: There are studies that approach
14 "certain 'industries that are ailing, 'the' steel industry,
10 the auto industry and the waste water treatment engineering
16 industry, and they tried to determine which government
1( policies should be fostered to stimulate more private
18 sector investment in doing a better job in those three
19 industries.
They went out to lots of people in industry in
-1 those three studies and tax incentives came out highest.
DR. ASHFORD: Sure the people benefitting from
tax incentives want tax incentives. . What is the rest of
the industrial establishment going to react by?
MR. BRAITMAYER: It is available to anybody and
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you are not specifying any one firm. You are saying that
2 anybody that comes up with something that they can demonstrate
3 as being a safer product than is currently available. If
you come up with this kind of a you can get in essence a
patent fast track, and here is the same thing it can be
done.
MS. KINNEY: Jack, you may be going on a
misinterpretation of something he said. I don't think Nick
meant that a particular company would be given a tax incentivej,
but that a particular industry would, and that there might
be other non-innovative industries that would react negativelyj
because they see their tax burden increasing as a result of
another segment of an industry or another industry getting a
tax benefit.
DR. ASHFORD: An example. Suppose that we didn't
have a PVC regulation and they said, gee, we need money to
develop-a safer product and we want you to give a tax
advantage to the entire polymer producing,PVC producing
industry.
Tell me what the polyethlene producers will do
with that. We have a safer product, we have had one for a
long time, we want to capture the market and here you go
subsidizing the PVC industry.
PROF. 3ARAM: But the installation of testing
li facilities
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MR. BRAITMAYER: You don't invest, you don't get
it.
3
PROF. BARAM: Why not make it across the board,
that any company involved in testing for safety to comply
with a set of regulatory requirements
DR. ASHFORD: Subsidize discriminate testing. It
is an inefficient way of getting what you want, because
you are subsidizing what the firm would have done anyway
9
on products liability suits.
10
It is nothing but a handout and it does not change
the relative attractiveness of different products within a
12
secment. It is absolutely the wrong thing to do.
13
None of them have ever worked.. In the European
studies that we have conducted in terms of government
15
policies, macro economically oriented, the handouts do not
16
work because they do not change
17
MS. SMALLWOOD: They don't create incentives
18
to do something different.
19
DR. ASHFORD: They just reduce economic burden on
20
the firm.
21
DR. MOSES: They pay for people they would have
00
hired anyway. .
i
23
PROF. BARAM: You should have it where every
firm has to demonstrate that whatever it is doing to
-3 i\
1 improve its profits does not redound to the profit of the
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1
company.
2
I am saying that with some careful analysis of the
3
tax incentive laws, one could begin to dissemble that
4
problem.
5
DR. ASHFORD: It is an example that destroys
6
itself, Michael. We get accelerated depreciation for
^ .,
i
polution control technology, but if you. made something a
8
different way, you can't deduct it.
9
In fact, that is exactly what you want to do. You
10 .
don't want gas scrubbers as a response to the industry. The
11 .
tax application of those policies are ass-backwards.
12
There are the wrong policies. They get it
13
. retrofit,, old plant, design. . .That, is; exactly .-why yqu: don't ....
14
want it.
15
You have to- find a way to reward those firms that !
16 I
have innovative capacity and can design better and safer j
17 '
products.
18
PROF. BARAM: Do you have evidence of this besides
19
the assertions that you are making now?
20 /
DR. ASHFORD: Solid evidence that the policies
21
in the past have led to inappropriate technological
22
responses, absolutely.
23
PROF. BARAM: These are assertions.
24 j
I DR. ASHFORD: No.
25
! PROF. 3ARAM: The tax incentive approach carefully ;
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taylored to the needs of the industry and public need didn't
work?
DR. ASHFORD: The tax'incentive approach does not
reward those firms to change process technology. It rewards |
those firms that develop compliance technology and the growth
of the compliance technology industry, its sales of devices
the legend.
8
While the rest of the economy falls down, that
9
industry continues to claim, but is that the kind of changing
10
11
12
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15
16
17
18
19
20
21
09
50
product process technology we want to wish upon the public
for decades to come?
If you are asking whether this set of eight
. policies -are.-going, to. work,:i;:---can only-.-tell, you--'the-'
following, and this is the new pieces of data which is not
in the book.
We looked carefully at the effects of regulation on;
innovation in the pharmaceutical industry, an area which
allegedly has been terribly hampered. We found that the
actual way in which new products get developed and the
choice of products has been radically changed as a result of
these regulations.
The kinds of products being developed, the search
for new kinds of products, the scientific mix of investigators1
i
24
has .chanced radically.
.0
rn V, ,-
Tnere are cnances occurring in innovation in trie
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automobile industry for the first time in 25 years. The
point is that when you finally begin to ask the firm to con-
3
centrate on process and a new product development rather than
4
retrofit, you get a different kind of payoff.
You get ancillary benefits, you get the sale of
those technologies in different industries, which has nothing
to do with compliance.
8
MS. SALONIK: I have a couple of examples here,
9
which I apologize for not getting to you before. From
10
Chemical Week, to illustrate in the chemical industry what
11
Mick is saying about some others well, one is the end of
12
an article on RCRA and there is a quote at the. end from
13
somebody from the environmental firm of Coopers and Librand
14
PROF. BARAM: Accounting firm.
15
MS. SALONIK: -I am being sarcastic. These are
16
people whose word can be trusted on this and not somebody |
!
with a bias in the other direction. . !
is . . I
That he believes that RCRA could be a strong force
19
in the industry because it is leading to a broad rethinking
20
of most of the chemical processes, and then there are six
21
examples here. .
22
Unfortunately, this doesn't have a date. The
23
other is from the most recent Chemical Week titled "How to
24 - '
limit-the rising cost of stricter regulations", which you
25
jj would assume, particularly in this journal, would be about
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to
cutting, back federal regulations, but, in fact, talks about
how firms are beginning to accept the fact that some of
these environmental and other health and safety regulations
are, in-fact, changes in social values which they have to
deal with like any other market demand or shift and are
6
restructuring themselves to deal with them in the most
efficient cost effective manner and are finding, in fact,
8
that they can sometimes turn their response to regulation
9
into a positive economic benefit.
DR. ASHFORD: Montey Throwdahl and I shared a
platform about six months ago, and Montey said he is
vice president of Monsanto he said, and I think I am
being faithful to him when I say this that that company
is looking now forward to market opportunities and belief
that the health and safety concerns will be a competitive
advantage to his industry.
I am hearing that off the record, I am hearing that
on the record. It doesn't mean there aren't going to be cost
to environmental regulation.
I am just saying that there are new opportunities
and from an investment perspective, attention paid to those
issues might very well yield better results than complaining
about the need to comply.
24
But that remains to be seen. Let rae sum ua.
I'nz-s repor- ana cur group nas at-empuec. cc come up witn wnan
Acrna Saporting Company
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we believe are a set of six or seven policies that you can
consider as a group on an experimental basis to see if we
3
can, in fact, offset some of the effects that might occur
4
as a result of TSCA.
I think Judy Nelson should talk about other work
that she is sponsoring and the extent to which the office
will or won't move forward on this program as an experimental
s
basis.
9
We only stopped at the point of recommending
10
sets of policies.
11
Jack, if you have strong feelings about those sets
12
of policies or think they should be re-thought or you want
13
to do an alternative analysis, I am sure this agency would
14
be really happy to hear it.
15
This was meant to serve as a starting point for
16
dialogue and I think intelligent discussion would benefit
everyone on this issue. I just hope we have clarified some
18
of the issues here.
19
MS. KINNEY: Before Judy starts, let's take a
20
five minute break.
21
(Recess.)
79
MS. KINNEY: The committee will come back to order,
23
olease. i
I
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Judy Nelson with the Regulatory Impact Branch of ;
EPA is here, also, and as she told Marion during some of the i
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questions, she is going to be addressing some of the things
that EPA is looking about with respect to.both, I guess,
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assessing what effects may be as far as cost on the
4 industry, and also what kinds of incentives could be used by
the agency to provide an incentive for safer products without
actually resorting to regulation, and then also what you are
doing in the area of the specific and more general things
8 that Nick's study dealt with.
9 MS. NELSON: Thank you. I thought I would break
it up into two parts, as a continuation of Nick's discussion
11 I
and talk first about the six policy options that M.I.T.
1°
recommended and some of the things that are being done or
» n
under consideration there, discuss that very briefly, and
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then I-will go'into several other studies :that we have under-
way to look at either innovation in the chemical industry
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or innovation with respect to specific chemicals.
I think Nick has summarized the study very
18
well and the policy options. In fairness to M.I.T., we
19
did not ask them to quantify the burden of TSCA on the
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chemical industry, so let me make that clear.
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I don't know if Michael heard that or not.
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MR. MOONEY: Would you make that clear, again?
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MS. NELSON: In fairness to M.I.T., we did not
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ask them to quantify the impact of TSCA on the chemical
industry, so nhat was outside of the scope of their study.
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MS. SALONIK: Outside of the budget, too, I might
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add.
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DR. ASHFORD: Outside of the realm of pockets.
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MR. MOONEY: If anybody could do it, M.I.T. could.
MS. NELSON: But we did ask them to basically
determine policies that would result in redirection of
innovation, reducing the negative effects of TSCA, while
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still meeting the goals of TSCA.
9
The six policies that they came up with are the
only ones I am going to talk about. I will go through each
of them very briefly..
The first one was dissemination of information,
either test results or labelling. This is something that I
think -we-are doing actively 'and'passively'over the -last few
years and will continue to do.
. Many of you know about the industry assistance
office,' which disseminates a great deal of information.
And you also know about the possibility of a labelling
standard, which we considered at one point.
At this time, we are not proposing labelling of
chemicals, and I don't know whether you are familiar or not
that the Occupational Safety and Health Administration has
recently proposed such a standard.
DR. MOSES: So those meetings with the groups
I t'ilkir.g about EPA, that is off, there is not going to be any
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joint effort between EPA and OSHA regarding labelling?
MS. NELSON: No, there is not, at this time.
We have supported the idea of labelling as an information
dissemination tool.
MR. LENTZ: When you said at this time, are you
saying that there is still a possibility?
Are you leaving the door open?
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MS. NELSON: I don't know.
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MR. MOONEY: If they can think of something
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OSHA left out.
MS. NELSON: I didn't say that, Tom.
MS. SMALLWOOD: Are you telling us something
without telling us?
. '" ' 'MS. NELSON:- From your'previous meetings you were
told there may be a proposed labelling standard.
DR. MOSES: Twice we were told.
MS. SMALLWOOD: Now somebody has decided there is
not going to be?
MS. KINNEY: Because of OSHA's action, EPA has
decided not to go forward.
MS. NELSON: I believe January 16, January 17, the
Federal Register notice contained the OSHA proposed labelling.
MR. MOONEY: Just before the 20th.
MS. NELSON: Somewhere between the 16th and the
;i 23rd it was printed in the Federal Register for those of you
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who are interested.
MS. KINNEY: Let me ask a question on the first
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recommendation, dissemination of information.
I got the impression from the recommendation, one
5
of the objectives was to actively disseminate information,
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not so much to the industry itself, as to the possible
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customers of the industry about what has been done on various
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chemicals, what tests and what the results are.
9
Is that what you are doing when you talk about the
10
industry assistance office?
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Do you mean disseminating it within the industry?
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MS. NELSON: I think it is all elements of the
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public, industry as well as they want to know as much about
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the effects of chemicals as a result of tests as the general
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public and the consumers. ;
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MS. KINNEY: Are you targetting the general public j
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in the consumers?
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I got the impression that you were really targetting
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the industry.
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MS. NELSON: No. I think we are targetting the
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general public. I think we would support the idea of
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targetting the general public. .
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MS. SMALLWOOD: Is that actually going on now,
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targetting the general public?
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We know you are doing the industry.
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MS. NELSON: I think there are more things that we j
could do in that area, but certainly the public participation {
programs, the other things that have been implemented, are
an effort to target it at everybody, possibly to all
groups, adn I think the agency as a whole has a new policy on
public participation and this is very supportive of that idea.
MS. SALONIK: Not anymore. OMB cut the entire
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public participation budget.
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MS.KELSON: Oh, did they?
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MS. SMALLWOOD: I was going to ask, did you know
something new that I didn't.
MS. NELSON: No, I don't.
MS. SALONIK: And Reagan and Stockman are not
likely to put it back, I don't think.
MS. SMALLWOOD: May I ask a question, because I \
.am not sure where you are in the structure. So that when we
are talking about these policies, the six that have been
recommended by Nick and others, are you now reporting that
you would like to do these or are you just re-reporting about
them?
MS. NELSON: I wanted to keep this brief, just
talk about what we were doing, where we were considering
options, where we basically .supported them and had in the
past and would continue to.
Let me just run through them. The second ...one is
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generic PMN's for classes of new chemicals.
There are various ways to implement that that
have been under consideration and I think you can consider
that the work that we do with test marketing exemptions,
there are test marketing exemptions right now; the PMN
review process, you are familiar with that, are really part
of that whole program.
There would be other ways that you could implement
it such as exemptions for certain types of chemicals. There
is a question about whether or not that should really be
done.
Going on to sort of government support for
better, .test-methods, . that is--'-something -that the-' -.Office .of :
Toxic Substances and EPA in the past has supported. We have
recommended it to R&D .and have supported budget in that area
and there are funds, and I hope we will continue to support
it.
Of course, this is an uncertain political
environment today. In the rea of fast track PMN's, which
Nick really talked a great deal about, and I don't know whetheir
I have a whole lot to add, you know that there are a number
of options under consideration for how to implement that.
Some of them vary from such things as notifying
i| the manufacturer in advance or notifying the manufacturer
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even if it is not the end of the 90 day period.
There are different ways that is in the very
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early stages of development. As Nick said, we are considering
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things, but I would say that there isn't a lot.
I think that, in fact, Warren Muir is going to
talk tomorrow and there may be discussion about that at
that time. Rather than steal his thunder, I would like to
go to the other studies.
We have also supported training and education for
professionals in the testing area, the things that Nick was
suggesting there. One of the more controversial and one
that I have left to the last has been the idea of direct
cost .subsidies .through .grants .and. loan....guarantees., for. testing
and compliance costs of new chemicals.
I will be frank that this has been fairly j
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controversial within EPA as to whether we should support j
them or not. I would expect a great', deal of discussion about
this issue to come up with the new administration, since we |
are in a change environment. °
/
This may be something that they will want to
consider along with tax options.
Let me turn and talk about
/ DR. iMOSES: Before you do, could you give me
| some idea cf which wav the cohtroversv, which direction it is
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MS. NELSON: EPA could recommend it with amendments
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MS. NELSON: It is so controversial I really don't
have a good feeling for that. It is a very debated policy j
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option. We would appreciate from this group a look at that
and their advice.
DR. MOSES: Well, it would require a change in the
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law, right, to do that?
In the original law there is not supposed to be
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any subsidization; right?
9
MS. NELSON: A change in this law or other laws.
DR. MOSES: So it is not something that could be
done by regulatory decision or administrative
to the TSCA. .-...,... . ,-,.-.,,..:/:. -. ..:.:,;.;.... '.-.-
DR. ASHFORD: Had we had a different super-fund
bill, you could have mentionedthat joint contributions could
-even up as providing a kidney for testing and that would have
been a very creative utilization of those revenues, frankly.
MR. MOONEY: Before you move on, you responded on
the generic PMN concept by mentioning the test market
exemption. Nick, is that what you are talking about? That
doesn't sound to me like an example of how one might
opera.tionalize that concept, because you are still burdened
with making application, and meeting a carrying a burden
of proof that is really not that different from a PMN itself.
MS. NELSON: Test marketing exemption is probably
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a poor example there. Let me give another example.
You might actually have either exemptions or
reduced requirements for certain classes of chemicals where
you knew that the class of chemical had low toxicity and
was combined with low exposure.
MR. MOONEY: You are talking about some definition
of a category of chemicals or products with the
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parameters sufficiently defined that I can conclude on my
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own that I fit into that category and I therefore don't need
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to file?
DR. ASHFORD: Yes. This is the generic PMN
recommendation, so that there is a set of understood rules of
the game, so you don't go naked into the system.
' MR. LENTZ:' Is Warren Muir going to talk about that
tomorrow?
MS. KINNEY: We can ask him to.
MR. LENTZ: The activity that is going on in that
area?
MS. KINNEY: You may want to go to the PMN study
group because there will be people here from that division
to talk at length about that.
MR. MOONEY: Does the fast track, will that take
amended or would that take amended in your view?
MS. NELSON: Both the generic PMN and the fast
'j track are within the mandate of TSCA, in my view. The ethers
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l are not necessarily within the mandate of TSCA.
2 MR. MOONEY: I can't manufacture^ until 90 days
"**-*.,
3 after I file my PMN, within the law?
4 MS. KINNEY: I think there is authority that
5 says you don't have to wait 90 days.
6 DR. ASHFORD: EPA has to give a-reason why it
" needs 90 more.
8 MR. MOONEY: When you are talking fast track,
9 there is a presumption that the time frame can be
10 compressed and I am questioning whether there is a
/'
11 statutory time frame established that you can't compress.
12 DR. ASHFROD: No.
13 MR. MOONEY: You mean I am not in violation of the
14. . -1 aw . i f: I. s tar. t -pr oducing 1 e s s than -;9 0 - -day's -.-a fter -.-*-''., ''.':'
lo MR. NELSON: It depends on how we implement that
16 particular policy, and I am sure that it can be argued both j
1( ways. Actually, I am not a lawyer and Nick is.
18 " DR. ASHFORD: I can't speak for the agency, but
19 the way I read it is that the determination must be made
within 90 days. If the determination is not made within
~l 90 days and no other action is taken, you may produce after
90 days.
EPA may make the determination in two days, in
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which case you can produce in two days after they have received
it and passed favorably on it.
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MS. SALONIK: I think you are wrong. I suggest
you wait until you hear from Warren tomorrow. I think Tom
is. right.
MS. KINNEY: The policy conflicts are that you
have in section 5 a public notice and a time in which
supposedly public groups could come in and comment in
addition to the administrator deciding to take action, and
that would be the argument for saying EPA cannot
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shorten the 90 day period.
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But there is authority under their we are
talking about the exemption authority, the administrator
may upon application and by rule exempt a manufacturer
.from requirements-.-of section. 5..'' '. .'.-.'.;. :v. >'' ... :" ;; '" '.
I think EPA could use that authority to say, this
is generally the cases we will say fast track, and if you
come in and meet these qualifications, we can fast track
you.
MR. MOONEY: And we are going to exempt you from
the 90 day minimum.
MS. KINNEY: That would be the exemption.
MS. NELSON: Janey, I would like to suggest that
I think Warren plans to talk about this tomorrow. He
certainly is more involved in the development of.this policy
than I am, so why don't we defer the questions on that
i until tomorrow?
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MR. LENTZ: What section did you just read that
out of?
MS. KINNEY: Right near the end of the section.
5(h).4.
MS. NELSON: I would like to turn and mention
6
three studies that are dealing with the effective innovation
7
on either the chemical industry or specific chemicals.
8
One of them has been completed, and it is the ICF analysis
9
which is currently out for public comment and looks at the
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effect of the PMN program on the chemical industry.
This is a three volume document which we published
in November, and the comment period has been extended and
will .close on/ February, .13 v .;'.-.... ; .-.'. .. :; '. V ..' ;'. .'":';. -.:';'. " :
I do have a couple copies here for people who
don't have it. We can get you more or they are available
from the industry assistant's office. Let- me summarize
for a minute a couple of things about it and how it differs
and is similar to the M.I.T. study.
This particular study looks only at the options
or alternatives for the PMN program as it applies to new
chemicals, the section 5 program.
It looks at the ' and evaluates the reproposed
rules and notice form which were published in October of
i '79, and several other options.
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In particular, it locks at the costs of
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complying or filling out the form, and it also looks at
various options for treating confidentiality and other
3 rule provisions.
4 It attempts to evaluate the different options
for rule provisions relative to the impacts on the
chemical industry, and it also looks at the costs. It
comes to a couple of similar conclusions with the M.I.T.
8 study.
9
First of all, there is a great deal of difficulty
in quantifying the effects of TSCA on innovation outside of
quantifying the costs of filling out the form.
In other words, it is difficult to quantify the
13
14'''
impacts on growth, the numbers of fewer new chemicals thai
make up the market.
15
MR. LENTZ: It is a speculative study, right?
16
MS. NELSON: It is a prospective study. It
attempts to quantify what would be the future effect of
18
TSCA on the chemical industry as a result of the PMN
19
program.
20
It is also similar to the M.I.T. study in that it
says that there are a number of provisions, things we will
00
both have adverse effects on innovation as well as some things
which stimulate innovation and that there would e some
24
redirection of innovation within the"chemical industry,
and of all of those the net effect of TSCA is unknown, the
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net effects of the premanufacturing program is unknown.
That conclusion was not focused on early by
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Nick, but was incorporated in the M.I.T. study to some extent.j
MR. LENTZ: Judy, trying not to be facetious,
do we know how many studies of that nature have been
6
conducted on the impact of TSCA, enough money, I think, to
7
have some innovation sponsored?
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MS. NELSON: You are right. This study is a
9
support document for the proposed rules, and once the comment
period closes we will be moving forward with the PMN rules.
MR. LENTZ: That study was required?
MS. NELSON: That study document was required, so
.it was .not optional .whether we did ..it or not.. .. .. . . .....
MR. MOONEY: There was an earlier Arthur D.
Little study.
MS. NELSON: Yes. The difference.in the studies
is that the Arthur D. Little study only attempted to quantify
the costs to perform and did not examine the various
rule provisions such as confidentiality and the import/export,
various other parts of the program.
Furthermore, the Arthur D. Little study did not
attempt to make any determination about impact on growth of
the chemical industry, et cetera. Or macro economic
jj concepts.
MR. LENTZ: Wasn't the Arthur D. Little study
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commissioned to determine the costs of the first proposed
PMN rule?
MS. NELSON: That is correct. 'This one looks at
the cost of the reproposed form, but goes beyond that. It
also looks at the various rule provisions. For anybody who
wants that, I have a couple of copies.
Let me go on. Two other efforts that we are
doing which have not been completed one of them is a
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major study'which would try to do the thing that Michael
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has asked the question about earlier and which .is
basically the purpose would be to develop a methodology
and determine what we would call the base line scenario for
the chemical industry .without.'TSCA ahd:. then to-, measure -thes,
impacts of TSCA.
Before I go into the'various parts of that study,
let me say that it is a difficult task. A very difficult
task, as Nick said.
DR. ASHFORD: I think it is impossible.
MS. NELSON: It may be impossible, and I am not
. absolutely convinced that it will be successful.
MS. SMALLWOOD: Who is doing it?
MS. NELSON: It is being done under contract for
us by Meta Systems, a contractor in Boston. They have two
subcontractors, Cha ;les River Associates and Data Resources,
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We started the effort in September of 1980 and
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so it is in its very early stages. It is anticipated to be j
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at least a two to three year study, and the only part of it
that we have worked on so far are to review the literature
on innovation and try to develop methodology as well as what
sorts of measures there are of innovation.
We "have spent quite a bit of time talking about
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that in general, and to find out what data was available.
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We do anticipate in the study attempting to collect more
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data. Maybe I should digress for a minute and say that I
consider one of the major problems of all the studies that
have been done today the lack of data on research and
development, expenditures and how decisions are .made to
develop new chemicals.
That is why many of the conclusions are all
qualitative rather than quantitative. It is an area that
has not been investigated in any depth.
DR. ASHFORD: Let me add, there is a difficulty
here, and that is what an innovation is not an innovation
is not an innovation.
In the pharmaceutical area of new chemical
additives, there has been the counting mechanism for
innovation. It is widely agreed that without weighing for
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therapeutic importance, you don't really know what the change j
in innovation is. j
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Merely counting chemical entities even if you
could get the data is only the beginning of evaluation
procedures as to whether we are in a better state of innova-
tion than we were before.
MS. SMALLWOOD: Is that why we are doing it?
MS. NELSON: That is one of the major problems
with trying to get the study off the ground and one of the
reasons why I am not 100 percent convinced it will be
successful.
You need to develop measures of innovation. You j
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need to be able to distinguish between the value of the
development of different chemical entities. You need to be
able to distinguish between product innovation and process
.innovation- and -all of -these': problems' ''are' -going to have to 'be'
overcome within the next six months if the study is going to
get off the ground.
DR. SLESIN: Last time I looked you couldn't
get a good number on chemicals being introduced, the value
they have or impact they have.
MS. NELSON: That is true that there is no published
data on that. If we feel that that is a valuable measure,
then the next step will be to probably try and survey the
industry to make determinations of that.
To do a survey we have to develop questions, get
clearance, and it may be very difficult.
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MS. KINNEY:. How much is being spent on that
study?
MS. NELSON: Maybe I should back up before I
answer the question and say that there are two phases to it.
The first phase is to develop the methodology and see whether
6
we can develop the survey instrument and would be able to
collect the data.
8
We have a type of contracting situation where there
9
is an option to extend the contract if we feel that it would
be successful and we can go forward in measuring the impact.
The first phase has about $200,000 in it, somewhere!
between 200 and 300. I can't remember the exact figure.
.. .-. .;., MR. /LENTZ :''. -.That- is..j-ust to .-'develop .'the'methodology
MS. NELSON: No, no. That includes the data
collection efforts.
MS. SMALLWOOD: That is just phase I, this big
gap between 200 and 300,000 dollars, that is just phase I.
MS. NELSON: Most of that money is to be spent on
survey and the development of the survey, getting it through
and collecting the data.
MR. MOONEY: Actually, conducting the survey?
MS. NELSON: Yes, so that the $200,000, covers not
only the methodology, which is a much smaller part of that,
|| and I don't have the figure between the two
MR. LENTS: The survey is for the baseline data
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before TSCA?
MS. NELSON: Yes. Well yes, primarily. We
may be looking at other things, too. That is hard to answer.
DR. ASHFORD: Let me just say that if the Chemical
Manufacturers Association this is my position, not EPA's
ever really wanted to do the job
MS. SMALLWOOD: They do it.
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DR. ASHFORD: Get it right.
9
MR. MOONEY: Let's get the record straight. The
industry is doing that and there has been substantial dialogue
with EPA over this entire subject, and Judy is well acquainted
with that.
- '' MS.; NELSON: ''That is''right.' 'Nick''said it 'was his
opinion
DR. ASHFORD: I think they have within their
capability the confidence of their member companies', and they
really could get reliable data if we wanted to. You say
they are actually doing this?
MR. MOONEY: Yes. Judy's numbers, $200,000
sounds like a lot of dollars, but it is Katey bar the door
when you get into one of these things. It is really tough
going, and the difficulty within any given company is that
any model questionnaire is never quite right for your own
24
accounting system.
We don't necessarily keep records and dollar figures
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and budgets in exactly the frame work that ends up emerging
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from either' an EPA questionnaire or a CPA questionnaire and
then you end up with difficult decision making on allocation
of costs.
What did you really spend these dollars for back
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then. Your definition of terms gets critical and the
mnagement time involved in going back and making those
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decisions gets very heavy and the whole thing gets very
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tough.
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In effect, it is kind of the same thing. ' It has
a couple of facets to it, one of which is trying to get at
the innovation issue and develop baseline perspective, and
then subsequently .it would.be anticipated one.could .track,
which sounds very much like what you are talking about with
MET A.
16
The other part of it is the ongoing operating
impact of TSCA, which at this point hasn't really gotten
that far. There hasn't been that much that has happened
and the costs have been largely the costs of regulatory
resources that have been involved in working implementation
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and that sort of thing. !
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DR'. ASHFORD: Are you pre-TSCA, are you investigating
ii the annual oroducticn of new chemical entities, incustrv
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segment by industry segment as a matter of historical
investigation?
If you don't do that, I don't know what you are
doing. I am sorry. I want to go right to this point.
If you are not making an assessment of the number
of new chemical entitites that are going to market year after
year during the period of time you want to investigate,
say 60 to 70 or 60 to 75, industrial segment by industrial
segment, if you are not doing that assessment, then I don't
know how to conclude anything from what your study will show.
If you are aggregating the data and you are using
sales data rather than physical quantity and you are not
identifying the new products by company or by industrial
segment, then I don't'understand how you can possibly
get to any cause and effect relationship or any trend
analysis, I really don't.
MS. KINNEY: Did I suggest that you get together
after the meeting and talk about the methodologies?
DR. ASHFORD: But that was my comment about if
CMA really wanted to get to the source of the problem, that
is what they have to determine.
MR. MOONEY: I suggest you hold your objection
until you find out what the study is all about..-
MS. NELSON: Nick hit upon one of the things we
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determine new chemical entities by industry segment and
possibly disaggregated below industry segment by product
lines.
I think that is a very necessary part to be able to
measure the impact of TSCA on innovation or to measure
other effects that are going on in the industry, of which
there are many.
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That will be a very difficult effort, so that is
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why we are being so cautious about saying we will be
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successful.
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Let me just very briefly hit what would be the
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second phase if the first phase is successful and we choose
13
to go into the second phase..
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We would be looking at the effects of TSCA
15
between the passage of the act and about 1980, or in other
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words, the retrospective effects of TSCA, the costs to date
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and what those effects would be, and we would also be
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attempting to estimate the potential future effects of
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TSCA on the chemical industry.
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As part of that, the baseline is going to have to
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examine what would occur without TSCA and then make a
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comparison between the without TSCA scenario and the with j
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TSCA scenario. It is not easy.
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MR. 3ULLINGTON: What are you goinc to do with all
this data?
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You are not going to do away with TSCA.
MS. NELSON: No, but I think the very major
3
purpose of the study would be to measure the burden to
determine the kinds of policies that may be useful.
It feeds into the M.I.T. study in the sense that
with better information disaggregated information by
industrial sector, and where innovation is occurring,
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where effects are, we can consider various policy options
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that may redirect innovation.
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It would give you a much better idea than we
currently have with the M.I.T. study.
MS. SMALLWOOD: Is that your interpretation of
the implication? :". V .'"' '"'"' -:'-' " :'" ' " " ' ' '"' ' ' ' :
Because this M.I.T. study simply says that it is
horrendous to try to do that phase I and II that you
enumerated and here are some policies that you want to try
on an experimental basis.
MS. NELSON: I,am not saying that we are not
considering trying those policies on an experimental basis,
but I do feel that Nick would agree that we lack data on
innovations by industrial sector and that we would be a lot
better able to taylor various policies if we had a better
feel.
DR. ASHFGRD: I have not seen the design of the
srudy, so I won't pass on another contractor's work at this
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point. But it is possible to get some information which
will allow you a better feel for the problem.
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Whether this effort does that or not, I will not
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comment. You can't settle the question to the degree that
people concerned with statistical significance of these kinds
of studies would like to have you do it.
You can't publish it in the Bell Technical
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Journal. They won't believe it.
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If you have an honest entree into the industry
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and how innovation is changing for those cases where you have
a significant change up or down, you may be able to get a
feeling about it on a segment basis.
I don't think the effort should be determined
worthless at the outset. I think Judy is well aware of the
content of the exercise. Whether her contractors are, I
don't know.
MS. NELSON: They hear it from me often.
DR. EISENBERG: I don't think the question is
whether, there is sufficient data to determine the impact
on innovation. I think the question is whether, in fact,
the data you need to measure that is the kind of data
that can be gathered.
i If, in fact, you cannot gather the data that is
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that can be gathered and then utilizing that as a measure,
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I think that might be counter-productive.
MS. NELSON: You have hit upon one of the
other concerns, one of the other problems that I have with
the study and why it is a phase I and phase II approach.
I am not convinced that some of the data that we would
need to measure innovation is even available, and I am aware
of that.
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MS. SMALLWOOD: It was let by somebody else. Not
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you?
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MS. KINNEY: She is saying that they have the
option, if they find that the information isn't accurate, they
have the option to terminate the contract.
' MS. NELSON:' Right.' That is why it is the way it
is. I do not know positively that it is not available.
We have in previous studies tried to gather the data from
published sources and from some discussions with various
industrial representatives, various companies.
I think that this effort is a much stronger
effort to collect the data than we have done in the past,
and we may very well come to the conclusion that the data
is not there.
MR. LENTZ: Do we have a time table for that,
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Judy?
When do you talk about that coming to the front
again? When would you know that? Is there a tarcet date
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comparability, or that you are not going to be able to get
in the first place because of the requirements of hiring
another person to sit down with mounds of paper?
.... .. .-........-. ..-..", .;.: ....- ..{ . .; -':-. v ...-. :
' ' '' MR. MOONEY:' Well, it 'is' all" of the above. You
try to establish a baseline that will reflect what are the
consequences of TSCA. Nick was talking earlier about if
you do a particular test, can you, in fact, chalk up the
cost of that test to the fact that TSCA exists.
Well/ no, a lot of the times. You would have
been doing it anyway. But to look back and pick a year,
pick 1978 or any year, to go back and try to sort through
your whole R&D expenditures and allocate into these
various little compartments whatever you define them to be,
I don't relish the task.
MS. NELSON: Product development , going back and
determining what the investment decision process was.
79
for reaching that conclusion?
2
MS. NELSON: The closest target date I would say
3
is whether to go forward with a survey or a data
4
collection effort, and I believe that comes up in late
summer '81, about four or five months from now.
6
DR. MOSES: The constraints would basically be
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what Tom was talking about over here, that it would be
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impossible because of the different ways different companies
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collect data and report it out, that there is not enough
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DR. ASHFORD: If you want to find causes for
variation in what the chemical industry has produced
prior to TSCA, then I think you need to have those things
and then I think the difficulties you articulate is
important.
Just give me the counting of the products and
the segments. Forget the cause and effect, and look and
3
see whatever variation, for whatever reason, I want to
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draw a graph. Just give me the data for ten segments and
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let me draw the graph and I am willing to tell you that
I will put my money on my ability to extrapolate a line
more than any computer model you build in this area.
..... = . I -.am ..talking, about s.ome thing, very -'simple, and' ,.; .
I ask the question, to what extent is that data never going
to come out because of the natural reluctance of individual
firms they compete with each other, after all.
ANd if you can't get the data on the production
volume and nature of the chemicals, forget about the
investment strategies. You are not going to go anywhere.
MS. NELSON: It is much Isss the difference in
accounting procedures, which can be overcome.
DR. MOSES: .It is the resistance to give out the
information in the first place?
MR. MOONEY: Frankly, it is the cost of doing
it, too, and it is not free. A time commitment means that
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when one of these studies go, a corporation, if it buys into
2
it lock, stock and barrel, can be putting into it numbers
that make the $200,000 for the total study on EPA's part
look inconsequential.
You are talking about hundreds of thousands of
6
dollars within one company.
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MS. NELSON: That has been one of the problems
8
with CMA's study.
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MR. MOONEY: I wouldn't want to suggest that
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everybody who belongs to CMA is participating in that study.
CMA's membership is a particular cross section of the
chemical industry that doesn't begin to reflect the makeup
of the CSMA or any of the various other trade associations
that are involved.
DR. EISENBERG: What about just the sheer question
that Nick asked. Forget about the costs associated, forget
about trying to determine where the money spent was
spent for the product or spent for something you would have
done otherwise yourself, but just a simple body count of new
chemicals or production.
DR. MOSES: Yes, no, 2,000 pounds. That is it.
DR. ASHFORD: You don't even have to name the
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DR. EISENBERG: Just a simr.le body count.
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DR. EISENBERG: Without asking all those questions.
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MR. MOONEY: How many did you commercialize, when
did you introduce what? I think most companies would have
that information.
MR. BRAITMAYER: That could be done fairly
quickly.
DR. ASHFORD: That may held because you, yourself,
may not be conscious of the terms of that.
DR. MOSES: We run into that all the time in
health studies. We ask too many questions, you can't get
enough people, what do you want to know, what are you going
to do with it when you find it out.
If they don ' t ask for information, they might .do
it and that may help EPA.
MS. NELSON: I think that is a good idea. We
haven't reached the point of making that decision yet, but
that is certainly something we will consider.
You certainly have helped today.
MR. BRAITMAYER: .1 am not even sure that that curve
is going 'to tell you very much.
DR. MOSES: Let's look at it and see what it is.
MS. NELSON: It tells you more than you know now.
DR. ASHFORD: Let me tell you what it told us in
the pharmaceutical industry. It alleged that the Keffaufer
ij amendments decreased, the incus trv. How do vou draw a cause
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and effect relationship between the cause of a fall two years
prior to the passing of an amendment. That is what it does.
It is important if you want to construct a
baseline post-TSCA, let's create a pre-TSCA and post-TSCA,
and if you really want to know how large an effect you are
really having, not the irritation of the law, not the change
in the management relations and not the industry dialogue,
but you want to know are you being hurt and do you need
incentives, answer the basic question.
10 MR. BRAITMAYER: You will come up with a similar
11 . curve, that you will find out that innovation was going down
12 for a lot of reasons, economy, shortages, all kinds of
13 things.
'14 ' DR. 'ASHFORD: 'if'it is going down and then you
10 have TSCA or OSHA and it goes one way or the other or it
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goes up in some industries and down in other industries, isn't
that terribly useful information for yourselves as well?
1 MS. NELSON: Since the chemical industry is not a
19
monolithic industry, merely do that on an industry segment
('_;
by industry segment basis. That would help us in targeting
various policies like we were talking about.
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MR. BRAITMAYER: As long as we could agree what
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companies to weigh the significance of these new product
developments, major advances in catalysts, major advances
in polymers.
You people have a tremendous amount of ingenuity
and intelligence in this area. The pharmaceutical companies
is a real black area.
MR. MOONEY: If it doesn't sell, it isn't
innovative.
DR. ASHFORD: Not only sales, it is the length
the product stays on the market, too.
MR. MOONEY: But that is ultimately the test and
it is a very frustrating thing to technical people at times
who have behaved in an innovative way to deal with a problem
.that is part. .of the ..development- chain'' .and ' the ''end 'result
is something that, however important you think it is, just
does not achieve the commercial goals set for it.
DR. ASHFORD: It might be because there is too
much foreign competition from the domestic perspective or
other reasons, but it is important to know where you ought
to put your bucks.
Where are you hurting the most and where is the
opportunity for the greatest recovery, economic recovery?
That is important to know; isn't it?
And the answer doesn't lie in analvzinq R&D
"° budgets, by the way.
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MR. BRAITMAYER: A lot of us don't want to do that,
either.
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DR. SLESIN: Can one assume that the reason there
4
is an innovation problem in the chemical industry, the
allegation is that there is a serious innovation gap.
DR. ASHFORD: There is an innovation problem in
this nation across the board. It has nothing to do with
8
regulation.
MR. MOONEY: Nothing? A little bit?
DR. ASHFORD: No. Well, all right.
MS. KINNEY: There are lots of reasons and
12
regulation is one that is suggested.
1.3
' DR. ASHFORD: 'Regulation is'such a small
14
percentage, a small percentage of the capital expenditures
15
go to innovation the regulation in the industry. You
16
can't really attribute a cause and effect in terms of major
11
problems.
18
As you said or intimated yourself, the fall in
19
chemical production preceded the reg'ulatory era by some time.
20
MR. BRAITMAYER: The growth of the industry and I
21
the maturity level of the industry were affected.
DR. ASHFORD: If you compare, and this is hard
23.
compare your loss of markets'to the German chemical industry,
it doesn't have any clear relationship to the fact that we
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They have very stringent OSHA. regulations.
MR. ERAITMAYER: And they give very nice tax
incentives to export.
DR. ASHFORD: It is important to ask the question
whether those tax incentives really if you have to export,
MR. BRAITMAYER: The Germans have a nice market
at home, but their real impact is in the world.
DR. MOSES: Like the Japanese in cars.
9 MS. SMALLWOOD: If the second study got this
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much discussion, what is the third study?
DR. ASHFORD: There is always someone to keep
track.
' : MS. NELSON:' Jessie is very good at that.
Let's go on to that very briefly. We are doing
some .work on chlorofluorocarbons. Most of the work is in
support of the potential regulation on chlorofluorocarbons.
One of the aspects of the work that we are doing is to look
at what sort of changes are going on in the industry, both
the manufacturers of chlorofluorocarbons and more ('
importantly, equipment makers who provide equipment to users
and users themselves.
It is sort of innovation and changes can occur
there. The contractor for the chlorofluorocarbons work is
Rand Corporation in Santa Monica, California. They have done
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familiar with it.
I am only going to talk about one task in all the
3
work that they are doing, because it is the only one that
4
really relates to innovation. This particular task is a
contract that asks them to look at and identify various
innovations that are occurring with manufacturer's
equipment, manufacturers that supply it and users.
They are looking at things like who performs
g
the R&D and who developes the various innovative processes,
how they determine their investment, how long it takes to
bring these innovations to the market.
12
After they characterize those innovations that
13
are occurring or can occur in the future,/..they .are
14
attempting to measure to what extent those things can
15
encourage the reduction of chlorofluorocarbons, whether or
16
not those could occur in European countries and whether or
11
not we can use those to support the regulation or encourage
18
faster reduction of the emissions to the ozone.
19
It is only a task. It has not started yet. It
20
is being somewhat delayed by our efforts to work on regulation
21
and other parts of the program. But it is something we
00
anticipate doing, and I think we will have some benefit
23
to the agency both in the international arena of chlorofluoro-j
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carbons and with our regulation development process.
Since we are kind of short on time, I think I j
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will end it with that.
Are there any questions on that particular one?
It is a little early to really describe it other than to
mention it.
MS. KINNEY: Judy, you mentioned earlier that you
thought it might be useful to the committee to express some
recommendations on the recommendation in the M.I.T. study
with respect to grants or subsidies with respect to testing.
Are there other things that you think would be particularly
useful for this committee to address?
MS. NELSON: Let me first of all say that I meant
it with respect to all six options, six or seven, look at
what M.I.T. recommended. I said that the grants and loan
guarantees was.-a.more.-controversial -ar..ea> but.; I' -think,-the '.=
committee could provide recommendations on six that would be
useful to us.
Your comments today I have found very helpful
on what we tend to call the innovation study or the look at
the impact of.the TSCA, retrospective and prospective impact,
the major subjects that I talked about, and I think that
anymore thoughts you have or specific ideas about how that
study could be taylored would be useful.
i
DR. ASHFORD: How do you think industry fee Is '
about a loan guarantee for a grant program? Getting money
from the government that way?
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1 MR. BRAITMAYER: I think that is going to be a
2 bag of worms.
3 MR. MOONEY: There isn't any industry view. There
4 isn't one industry view. I oppose it.
5 MR. BRAITMAYER: So do I.
6 MS. KINNEY: Why?
" MR. MOONEY: I would prefer to do my business on
8 my own. I don't need government money.
9 DR. ASHFORD: Do some small innovative firms
10 need government money?
11 .MR. MOONEY: I can't speak for them. There are
12 bound to be some firms out there that would love to have it.
13 I don't know how big that segment of the industry is.
14 DR. ASHFORD: .Is there need for any policy? .
15 You said you would rather do it on your own.
16 Does that mean you would like to let TSCA proceed on its
17 own basis without worrying about the effects of the
18' regulation?
19 MR. MOONEY: I prefer to see TSCA implemented
20 in a reasonable way. It is the law of the land, it reflects
-1 public policy and we have got to make it work right.
OO
DR. ASHFORD: You think 2(b)3 is not a serious
23 concern in terms of TSCA?
24 MS. KINNEY: No. I think he is saying that he
~° : wants to see TSCA implemented in a way that minimizes the
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burden so that you don't have to do things to compensate.
MR. MOONEY: To put it in terms of the
3 recommendations you are talking about
4 MR. NELSON: You prefer the ones that are -within
the mandate of TSCA?
MR. MOONEY: I prefer a creative regulatory
structure, the structure must be put together because it is
8 the law, and I would rather see that done in a way that
9 accomplishes the purposes of the act in a way that is going
10 to represent minimal burden.
DR. ASHFORD: If it costs you $300,000 to do an
12 animal test for carcinogenesis and it looks as if you ought
13 to do one because you get a positive Bruce. Ames,. .there are.
14 companies producing small volumes of chemicals for whom that
15 investment is not a- profitable one.
16 What is the way out of that problem. Either you
17 don't do testing or you don't get the product. Is that
18 acceptable?
19 .MR. MOONEY: First, you take a hard look at
20 whether or not you do need to do it. Given that the data
21 base argues vigorously for the conduct of such a study,
09 I don't know where you can get that study done for $300,000,
assuming that is the rate, I think there are chemicals that
are simolv coinc to co down the tube because the economics
oz it ina.-ce it imioossisie to run a cusiness "rcritaolv.ana
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properly with that kind of commitment.
DR. ASHFORD: Do you believe that some of those
chemicals, because they have great utility and because there
is a chance that they would turn out to be safe on an animal
experiment ought to pass through the system?
MR. BULLINGTON: Yes.
DR. ASHFORD: Aren't we going to lose good ones
8 there?
9 MR. BRAITMAYER: Yes. Is it practical to
produce.
DR. ASHFORD: I am just intrigued by your answer.
I don't understand it, because what you are saying is that j
.if indications are that there is good reason to believe we
need a rather expensive study before we go ahead and produce, j
that for .these small-volume 'chemicals' it' is .'better not'to
produce them and to deny the society their usefulness.
MR. MOONEY: That is the price of the law.
DR. ASHFORD: And that would be perfectly
acceptable?
DR. MOSES: That is what the pharmaceutical
industry does now.
DR. ASHFORD: Yes, but they have a monopoly
pricing system. That is okay with you, is that right?
I find myself in a peculiar position, arguing
for industrial development for the producer
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MR. BRAITMAYER: We are looking for common sense,
quick, practical solutions. We are looking for a way of
3
saying let's take we have to concern ourselves with TSCA,
4
with those things that have .unreasonable risk, which
represents a very, very small segment of the total chemicals
produced.
The first thing we have to do is to find some way
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to weed out and concentrate on those that really represent the
9
segment and get a mechanism set up to free up the rest of it
10
so we can proceed with our business.
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DR. ASHFORD: I understand.
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'"''" " MR. BRAITMAYER: ' That," I think, is the' area we
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have to concentrate on, say, there are certain things that
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are toxic and there is a serious, valid concern.
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We are going to find those things and we are not
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going to produce them.
DR. ASHFORD: I am hearing a mature response.
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which produce the standard products, better consumer
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the way they have traditionally crept?
MR. 3ULLIMGTON: There are other chemicals to
replace them and now vcu sav that we oucht to oroduce bad
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DR. ASHFORD: I don't think anyone could say I
was saying that.
MR. BULLINGTON: We are trying to tell you that if
we see a possible problem chemical, then we don't want to
get into that market, because then we are going to have
pressure put on us to get rid of that same chemical.
So we have got to kick it out before it ever
gets there.
MR. BRAITMAYER: As soon as our customers find
out it has a problem they won't touch it. From a practical
standpoint we couldn't sell it. You may get an Ames test
and you may say I want to run a few more Ames tests because
I don't believe that result for one. re.asp.n. or another, .that ...
is a different thing.
We are not going to blindly accept the first
test.
DR. ASHFORD: You run a series of Ames tests and
you don't run an animal test?
MS. NELSON: How do you feel about the better test
methods recommendations, the development of better test methods
MR. MOONEY: I think that is good. I think that
is an ongoing proposition right now, whether it involves
federal or independent company dollars.
That is going to continue and it has to continue,
,. I
I particularly ir tnere is an abuse of this concept that the
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long term chronic study is a be-all and end-all in toxicology.
2 It isn't.
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If the mutagenicity battery can be refined to the
point that we have confidence in it, that has got to be a
tremendous accomplishment. That is going to continue.
MS. KINNEY: It seems to me if government starts
giving subsidies to do testing, you remove some of the
8
incentive from industry to put some of their money in
9
developing better ways of doing the testing.
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MR. BRAITMAYER: I think industry will develop a
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cheaper, quicker method than a government consulting
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organization, because they don't have practical constraints
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on them.
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DR.. ASHFORDY You believe : that structure "
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activity relationships will eventually become a very part
16
of predictive sets of tools?
MR. MOONEY: It already is.
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DR. MOSES: That is why testing gets tested now.
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DR. ASHFORD: Let me tell you what intrigues me.
20
I read through the OSHA testimony on generic carcinogen
21
standard where people talk about the useful, and it is
controverted by industry witness after industry witness, it
is not a good tool. It can't be use. Bruce Ames is not a
24
good predictor.
25
ii Here I hear 180 decress around from that. Has
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the. world changed or has the forum changed?
N \
9 'v
Nx MR. MOONEY: The forum is different, and I am
3 ^~"
unprepared to accept that you fairly reflect the substance
4
of all of those two months of testimony.
I don't think anybody is going to deal in
c
absolutes on this, Nick. If what you are coming around to
i
is, will I buy into a scheme in which I take structural
8
activity analysis as my sole criteria, no way. Absolutely
not.
10
DR. ASHFORD: No. I agree.
11
MR. MOONEY: And so there are going to be
12 '
situations where I learn something from it and other
13
situations where I won't, and you have to have that judgment
14
involved .in .your ..safety assessment, process,. ..-.....-. . . .. ..--..
15
That is no different than using any other
16
criteria. ITC uses volume as its first screen. In its
17
last publication of 107 chemicals. That is narrowed down
18
from 50,000 and their first cut was volume, which is
19
equally simple minded and one way to go.
20
But to me they all are factored into the analysis.
21
DR. ASHFORD: I agree about the short term tests.
22
But what I conclude from what you are saying is that given a
23
little bit of time we are going to be able to get the
24
i predictive ./tools so that we can make sensible predictions
25 j / '
i about the toxicitv or a chemical and there is not come to be
Acme Reporting Company
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an unnecessarily difficult burden on technological
innovation.
3
What we want from the regulatory structure is
a smoothing, an accelerated handling and no dragging of
feet, but innovation isn't going to be particularly
hampered.
If that is what you are saying, I think that that
a
is important to understand.
9
MR. MOONEY: There are differing views on that
10
subject. I think I personally come out reasonably lined up
with Monte Throedahl. I think you can take any given
12
development,, any given..set of .circumstance..? .and.:look at. it...,
13
for the positive you can find in it or the negative that you
can find in it.
15
You can either say, god, this is going to kill
16
me or you can say I think I will see if I can find a
maximum advantage out of this particular set of circumstances.
18
You pay your money, take your choice.
19
I think if we have any ingenuity at all,.the
20
industrial sector can find ways, if permitted to operate in
21
a reasonably free market do we have a free market that
is a serious question. I am not an economist I 'think we
can survive.
24
I am not looking for ways to waste money, but
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1 advocating that we go out and get ourselves another half
2 dozen new pieces of legislation this decade on the theory
3 that regulation is good for us.
MR. BULLINGTON: I think Tom is trying to hedge
a little bit. We don't want to in any way imply that we
represent the whole chemical industry and every part of it.
There are so many different phases, and there may be some
8 areas that are affected by a whole lot more by TSCA than
9 maybe the'group that is represented here today.
10 You are right, Tom, wedo not want a lot more
11 legislation right now. We are trying to swallow what we are
12 up against, and I think that we are facing the facts pretty
13 'well.
14 We are fighting it, and I think industry will
15 come aroudn.
i
16 MS. KINNEY: Let's hear one more comment and then
17 open for public comments.
18 MR. BRAITMAYER: I think basically, we look at
19 TSCA as a problem because it hasn't been fully defined and
-° honed to the point that we really know what they want to do.
-1 Once we get that established, then it is a problem that all
industry has to face, whether it has to do with government
regulations of one sort or another.
- ^ . . , .
succeed or fan as to now it relates to its customers,
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domestically and world wide.
A company is going to continue to innovate
3 because it wants to prosper in its market place. Some
4 people may use TSCA as an excuse, but it is just another
complication to our lives.
6 MR. MOONEY: I fully support that. I think too
7 much has been said that is very polarized, that argues that
8 the only factor involved in a decline of innovation is
9 regulation.
10 That is absurd. I will take equal issue as I did
11 in arguing that it is in no way involved. It is involved,
but lots of other things are, too.
1 O
' '"' " MR. LENTZV ' You know,:':T ceftainly':endorse a' lot df
14 things that were said here, but Tom made an earlier remark
about reasonable regulations and unreasonable regulations
1 fi
could be very counter-productive.
MR. MOONEY: Nick, we are on the edge of, and
18
we will be getting.into testing discussions later, but we
19 have as an immediate publication on the 27th the minimum
pre-market data proposition out of OACD that the agency
01
has just published testing guidance on.
Now, it. is guidance, it is voluntary, et cetera,
et cetera. How the agency behaves in utilizing that guidance]
from here en, will have a lot to say about whether that is a !
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burdensome oiece of cuidance or not. '
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It describes a series of tests that I think
conservatively fit into a 50 to ?100,000 ballpark. If I am
manufacturing, I have a prospect of selling 500 to a thousand
pounds of in the course of a business year, I will have to
look hard at the economics of that or I will have to look
very hard at the base set and really do an intelligent
job of picking and choosing, and I presume in my hypothetical
that I am going to do that.
. Now, if the agency begins to start using base set,
although it says in its guidance it is not going to do this
if it now starts to test for its 5 (.e) actions on
insufficiency of data and how closely one conforms-'.to -that
base set ..becomes a very' sick factor in whether or not there
is a subsequent 5(e) action, either actual or implied by a
telephone call, how the agency behaves will have a lot to
do with what happens to a lot of little, small volume
chemicals, because I can see a manufacturer who is in that
business saying, nuts, it is not worth it.
I can't deal with the economics. I have got a
85 year payout on that chemical. And there is a chemical that
then never sees the commercial light of day.
That is probably happening now. Certainly it
will hapnen. There is too heavv a hand. We don't know.
11
24 |i DR. ASHFORD: We don't know. That is the trouble.
MS. KIrT'-lEY: Le~'s cser. the floor now for cc~~.~r.-s
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from the public.
Please identify yourself when you make a comment.
3
Are there any comments?
Are there any public people here maybe that is
the question.
Judy and Nick, thank you both very much. I think
it was a good discussion, very stimulating.
Before we go, let me" just mention, if people on
Q
the advisory committee need to make phone calls, please don't
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use the phones in here. Use the phone at the back of the
room.
For those people who came in late, the testing
work group this afternoon will meet in the 6th floor conferenc
in the East Tower rather than in the room that is listed
on the agenda.
.(Whereupon, at 11:57 a.m. the meeting was
recessed; to reconvene at approximately four o'clock the
same day.)
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3 MS. KINNEY: Before we et into the discussion
4 of the study groups and any recommendations , I would like to
ask if people have had a chance to look at the minutes from
the last meeting. If you haven't, let's hold off until
tomorrow morning.
8 MS. SMALLWOOD: Could we do that?
9 MS. KINNEY: All right. We will do those
10 tomorrow morning, then.
11 Let's go on to the discussions, summaries of
12 what we did in the work groups this afternoon and then' .......::
13 presentation of any .jrecommendations or resolutions that
14 we have.
lo Let's start with the section 4 group; Jessie, and
1 fi
other members of the work group, feel free to chime in.
17 MS. SMALLWOOD: I think what I will do, since we
18
had such a lively, active and informative group, I am going
19 'to read the recommendations and then let the committee
members give a sentence or two so that we don ' t take up too
much time.
90
The subcommittee agrees that the use of categories
in testing rules is desirable and should be used whenever an
74 i
appropriate category can be defined. That is one recommenda-
tion.
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I have to say I so move?
MS. KINNEY: Actually, yes, why don't we make it
3
formal.
MS. SMALLWOOD: I so move.
The subcommittee agrees that the use of categories
in testing rules is desirable and should be used whenever
an appropriate category can be defined.
8
MS. KINNEY: And categories should be used.
9
DR. MOSES: It does say
10
MS. SMALLWOOD: When appropriate categories can
be defined.
12
MS. KINNEY: Why don't you explain what we talked
13
about so we understand the background.
14
MS. SMALLWOOD: Our particular issue was to look
15
at the proposed rules and the biggest issue with the comments
16
from the public hearing was on the use of categories versus
l'
single chemical testing. And we went into almost every
18
available aspect considering whether we felt strongly one
19
way or the other, and since we did not feel strongly one
20
way or the other, the recommendation that I have given you
21
is what we agreed to.
00
The second part of the recommendation is that we
23
recommend that this issue be put on the agenda for full
discussion at the next meeting by the full gruop, and asking
them to read in the regulations, July IS, 1980, page 43515
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MS. SMALLWOOD: 48515, 48522, and it is July 18,
1980, acrylamides, something, something, something.
MS. KINNEY: It was in the packet. Does any
committee member want to .add anything to this? .
DR. MOSES: I think we are kind of giving the
impression that we got to that a little more easily than
we actually did. Well, I think the rest of the people here
should get an idea that there were sort of a polarized
not polarized points of view, but Tom has a very strong
point of view.
MS. SMALLWOOD: Louis had a strong point of view.
DR. MOSES: I think it might be nice, so the rest
of the people understand I hate to state somebody else's
103 I
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to page 48522 so that they get the full flavor of the various j
j
issues that we discussed in depth. j
3 MS. KINNEY: That one I don't think we have to
vote on. That is just a recommendation which we- can
keep in mind for the discussion tomorrow when we talk about
the agenda.
MS. SMALLWOOD: Yes. So I only have really one
recommendation.
9
MR. LENTZ: Would you give the pages again?
23
point of view.
MR. MOONEY: First f )f all, I flet that the
: ;.
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j recommendations that YOU nave tliere was one that we were coiner!
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to bring forward to lay on the table or whatever the
parliamentary procedure is to be acted upon later, not at
this meeting.
MS. SMALLWOOD: No, to be discussed at another
time, but to bring forth as a motion now. That is what I have
just done.
MS. KINNEY: Not to be voted on as to whether we
adopt it.
9
MS. SMALLWOOD: Particularly after they have read
10
those pages, that is correct. Thank you.
n
MR. MOONEY: Yes, because I think it is a
12
complicated issue we are dealing with that in my mind revolves
13
around the complexities of figuring out what .category means.
14
It seems simple at first and when you try to apply the
15
concept which we are endorsing as a concept, the wickets
16
get sticky when you try to figure out what it really means
17
and what the implications of establishing a category are
18
and what you do as a consequence of generating the data
19
under a category rule with specific mention of a category.
20
So it is not an easy issue to get into, and there
21
is plenty of room for divergent .views. I happen to be a
supporter of chemical specific rules simply because I think
they are a lot easier to articulate.
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You .can make sense out of them a lot easier, and
not invite the complexities and questions that arise when you
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try and construct a category, but I am not suggesting that
I don't believe appropriate categories can be defined, I
just can't simply define one . at the moment.
MS. KINNEY: Lou, why don't you briefly explain
your concern?
c
DR. SLESIN: As Tom just said, I think there was
general, perhaps even universal agreement that the concept
Q
of categories is a useful one. I would like to go a step
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further and say that the implementation of that concept is
an important step.
The issue here is a matter of trying to get through
some of the backlog of chemicals so that you don't have to
test each one, but that one can make reasonable inferences
about one chemical based .on .the. test results . of another, .pne...
The reasons are manifold for this. One is that you
have limited testing capacity, limited money which you can
even spend on this and a very, very large universe of
chemicals to get through, and so the concept of categories
would carry you through so that you don ' t have to use
scientific perfectionism, if t/ou will, to say that you must
only regulate or somehow restrict the use of manufacture
of a chemical unless you are absolutely certain about the
effects of that chemical.
' .
That is to say that you can make judgments about
25
a chemical based on the effects of another chemical. And the
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debate really is how much scientific evidence do you have
to have to be able to make that inference. I would say that
that is a judgment of risk that really is not clarified
by the act and would depend on the agency's decision making
process.
The point here is that you just have so many
chemicals that I think that you have to do that, and I think
it is one of EPA's tasks to try and clarify how you go
about doing this, and from our meeting this afternoon,
it is clear that EPA is really not out of the wood in terms ofj
making a decision as to how the agency will approach this
task.
,. . Ir. frankly.,', was ^..little'disappointed .that.:the. ,-.:,.
agency hadn't come further in the sense that although the
comment period already closed mid-October, from my reading of
the comments that were submitted, there were not too many
surprises, that is the positions made by industry in the
past and by environmental groups have not really changed
all that much and have been clear to the agency.
I do get the feeling,once again, that the agency
is arbitratina between the environmental position and the
I
industrial position, with no clear point of view, no mandate,.!
I
no policy towards how to deal with this very complex problem, |
and that, I think, was rather problematic.
It is not that the agency has to agree with my
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position, but I would like to hear a position.
9
That is, they proposed one in the Federal Register
3
six months ago, and they seem to be unwilling at this point
to say where they are even today in their thinking. ,-Has it
progressed, have they changed their mind?
6
They are only willing to say that the issues are
^
complex and that they are mulling them all over. I believe
8
that, but it would be, I think, very useful to know at
9
each time when we meet with them where they are in their
10
thinking so you could say maybe you should go left or right
11
or whatever in the direction that they are following.
12 . - .--......
: . .;-. '.'. :;..r-tnink that-'is one of- the'-Jrea-s'dns "'the:' sub- ' ''
13
committee suggested they brief us on where they are. They
14
don't have to tell us that they have made up their mind
15
or that the policies are set, but just tell us what they
16
are thinking rather than telling us that the issues are
17
complex and no resolution has been reached.
18
The second part of that proposal, recommendation
19
or resolution is that they come and tell us and address the
20
full committee and give us a progress report. But not
21
platitutdes and not generalities, but what the agency is
22
j thinking, what is the policy of the agency vis-a-vis
categories, and what can we expect.
MS. SMALLWCCD: I would like to add that. I think
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of both either singular chemical or categorizing them, and
I guess what we expected was some kind of leaning or
direction as to when one they were going to deal with or
were moving toward, which they had not defined at this time.
The other thing is that the issue, and Sonya.-i
brought this out, but there were three alternatives listed
in the proposed in the rules, which they weren't leaning
8
to any of those, which was a little bit confusing. I guess
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what I ought to try to make clear is as the acting chair of
that committee is that we want them to come to us when we
meet again in March with more defined, with some direction
leaning and reasons why they are leaning that way, even if
they don't say to us, this is a tentative proposed
direction.
DR. SOBRIAN: Didn't they ask us if we had any
other alternatives other than their three, that they would
appreciate hearing what we would have to say on that
particular issue of how to test things in a category,
chemicals in a category? >
MS. SMALLWOOD: It was clear that they were
listening and that they were attentive to our discussion,
and I am sure if any committee member here who has
specific thinking or some research or feelings or
experiences about that issue submitted to them, they would
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I am sure that is the case, yes. They were very
2
specific about soliciting from us, our leanings or whatever.
3
MS. KINNEY: I think they are interested in seeing
if there is any general recommendation from the committee.
The comment period on the proposed regulation is closed,
6
and so I think it is questionable whether someone, an
individual member of the committee, could submit comments
8
and still have those considered part of the record, but I
9
think they certainly were very open to any suggestions
10
from the committee.
MR. MOONEY: We are dealing with some general
12
aspects of section 4 rule making that I think go well beyond
.13 : '.'-...'-''-. ''. :/ '; -v ';-.- '' "'- -;'v. - ' ..-'-': -': . '' . \; ':''' ' '> ='''. ' :
that one, so I don't think we need to be concerned about the
14
specific chlorobenzene rule and the fact that the comment
15
period is closed.
16
MS. SMALLWOOD: The subcommittee dealt with the
17
general substance and issues, rather than the
18
MS. KINNEY: It was raised in the chlorobenzene
19
text.
20
MS. SMALLWOOD: Yes.
21
MS. KINNEY: Any questions?
22
i MS. WARREN: Are they trying to resolve the issue
23 | .
once and for all whether you can proceed on a category
Dasis?
MS. KIDNEY: No. I cot the impression that they
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1
" are coming around to a recognition that things may vary
2
greatly from situation to situation as to whether to use
3
a category or not.
4
MR. MOONEY: I think they felt that they maybe
5
hadn't been quite clear enough in their chlorobenzene
6
discussion in making the point that this is a proposal for
7
the chlorobenzerB category, but doesn't necessarily mean
8
that we are going to behave this way in dealing with any
9
future categories.
10
DR. MOSES: That-is an important point. We didn't
n
get around to that until the session was over.
12
MS. S.MALLWOOD: I think if there was any one
13
conclusion, that might have been it. I am serious.
14- ''.:"..- .. .-..'':.- '. .. '' '/'.:'' .' "..'.:..'''.. '.''" '.-'".'.,'.'..-".'' -.'
DR. MOSES: One interesting thing that was brought
15
up is they might not even have to have a rule at all for
16
the chlorobenzenes because a lot of the testing has been
17
done. Industry apparently already has information on what
18
is needed and is going to proceed with it and it may not
19
be necessary to do it at all.
20
MS. SMALLWOOD: And still be within the court order
21
requirements.
22
MS. KINNEY: Let's move on to the section 5
23 ! '
| work group. Jacky?
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li Should I give that group a chance to caucus?
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] MS. WARREN: Do the next one.
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MS. KINNEY: Let's go to toxic enforcement.
DR. EISENBERG: Michael isn't here and Michael
is taking Peggy's place.
MS. SMALLWOOD: Who is taking your place?
DR. EISENBERG: Frances is here, but she figured
she would lay off for a week.
I want to apprise the committee that the reason
this was on the agenda in the first place was because of a
question that Peggy raised at the last meeting of enforcement
in general as far as TSCA was concerned, and the questions
raised to the various people from OTS, their answers were
always the same, that enforcement was handled outside of
OTS.
The question -then was..could .we'get somebody. , . .
to come on in from the enforcement area that could tell us
exactly how the various sections of TSCA are being enforced
if, in fact, they are at all. We had someone I am trying
to set the stage that this was primarily an informational
meeting for us.
I would like to share with you some of what we
have gleened because I don't think the rest of the committee
really was aware we certainly weren't as to how, in
fact, enforcement actions were being taken, whether, in fact,
they were at all, and what the overall strategy was for TSCA
enforcement. " '
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It turns out that TSCA enforcement is handled by
a separate assistant administrator entirely. It is the
Office of Enforcement, and there is one division which is
geared towards enforcement of TSCA, as well as pesticides,
one of the divisions in that assistant administrator's
office.
The three branches are housing policy and
strategy branch and the legal case branch primarily to put
together briefs and take things to court for litigation.
They also have a regional enforcement network whereby in
each one of the regions there are a number of personnel
assigned to handle, in the past it has been primarily
.pesticide -work./ ; but how .'getting .in to. -the -TSCA': side. :
I will mention the various sections of TSCA and
what kind of enforcement actions have taken place so far and
what they anticipate in the future.
The efforts that they have been primarily geared
in is three areas. First is PCB's, the second has been the
inventory reporting requirements and third has been the
f
chlorofluorocarbon area.
It appears that as far as the future is concerned,
the emphasis is going to be on PMN applications that is
section 5, and also section 8, A, 3, C, D and E, reporting
24 || requirements.
il
They are only new beginning to get into the sharing
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of information with the other agencies. In other words,
the information is being gleened either through inspection
3
activities their staff is rather small and all of the
inspection work, they rely entirely upon the regional
offices to do the inspection work, not the headquarters.
The headquarters staff is geared primarily towards
the policy and strategy area as well as, I think, in the
8
case preparation side. At the present time, from whatever
9
violations are noted on the inspection and compliance
10
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activities by the regional people, enforcement action is {
taken.
12
They have a concurrence activity here at headquarters
13
So rather than the region themselves, at this'point in time .
14 '
taking any enforcement action,, it is first sent to headquarter
15
to concur in and then it goes back to the region depending
16
on what the next step in the enforcement action is.
17
That is because it is a new program, they are
18
trying to get uniformity and there isn't that much confidence
19
yet that the regions know what it is that they should be
20
doing.
21
So they are starting off primarily with concurrence
here at the headquarters and then turning it over slowly to
23
the regions as, in fact, they gain experience and show
competency in the area.
Frances, aid I leave anything out?
Acrns Ssscrtirc Cornocnv
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MS. SMITH: I think that was a magnificent summary.
DR. EISENBERG: Michael might want to add something
3
tomorrow. I am putting together a resolution because we
were primarily looking at it as an information transfer
at this point.
MS. KINNEY: There has been a report inside EPA
saying that a proposal had been submitted recommending
that the enforcement office at EPA be eliminated altogether
g
and that enforcement responsibilities be shifted to the
state.
The U.S. Attorney General would get involved only
12
if the states requested that assistance. Did they refer to
13
that at all?
14
DR. EISENBERG: Not at all. In fact, they pointed
out, forcefully so, that at this point in time they are still
16
relying heavily on the concurrence of headquarters
enforcement rather than the enforcement act, if a violation
18
is noted in the field based upon inspection or anything
19
like that/ rather than the regional office having the sole
20
authority or even the prime authority to take any enforcement
21
action, before they could, it first comes up to headquarters.
They have to concur in the action and then the
action may, in fact, be taken at the legal level, but
concurrence at headquarters is mandatory.
MS. KINNEY: Was that just for TSCA?
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1 DR. EISENBERG:' Yes.
2 MS. KINNEY: I think the reason for that might be
2
that there is very little activity at the regional level
on TSCA.
DR. EISENBERG: They said the primary reason is
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that it is a fairly new program, the guidance is only now
going out to the regions in the area and because of that they
want to establish some uniformity and awful lot of
questions are being raised and coming back to headquarters
for policy and guidance.
They don't see this as continuing. They see a
loosening up and in the near future turning over the
enforcement without the concurrence at the headquarters
level.
MS. KINNEY: They did not anticipate that there
would be changes in that?
DR. EISENBERG: No. First of all, what you
brought up wasn't mentioned at all.
MS. KINNEY: The thing that causes me problems
is that with toxic, the states don't have the same kind of
role that they do in safety or water or in cleaning and it
would be terribly difficult, it seems to me, to shift
enforcement authorities, and I am not sure that the states
could.
5 '
! DR. EISENBERG: They did get into the states' rol;
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They are treading very softly. They don't know whether, in
fact, there is any legal mandate and they are afraid to
test it now because of the situation they might be con-
fronted with by their own contractors, primarily in the
area of confidentiality.
They are exploring the arrangements that they can
get into with the states in the inspectional area because
a'
they know they are in better position primarily because of
9
resources.
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
MS. KINNEY: They would deputize the state?
DR. EISENBERG: They don't know. They are looking
at the sections of TSCA, whether section 11 acting as agents
or contractual arrangements, whatever it is. They don't know
.yet .-' ;.. "'..-.: ." ".'..' ..- -..V'-.'-. ''''v'-- . -:.; ': '"' /.r-'-..-:'/..,: : ' ''.''" ' "':
MS. SMALLWOOD: Am I to conclude then that maybe
they haven't done any enforcement and they are now checking
out what to do?
DR. EISENBERG: That is not the case. They listed
statistics as to the number of enforcement actions they
have taken. In fines alone they feel they have taken in
close to a quarter of a million dollars in fines and
penalties and most of it has been in the PCS work.
In fact, most of- the enforcement action has been in
that.
_D
MR. MOONEY: You mentioned enforcement'.'on the PMN
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area?
DR. EISENBERG: Yes. One of the problems has
3 been when the deadline came on the inventory work and the
4 question came up as to those people that started submitting
information after the deadline on the inventory, are those
should you consider those as are they trying to get in
under the inventory rather than on a PMN, if you
8 follow, Tom?
9 MR. MOONEY: I was thinking in terms of the filings
10 and the action taking place.
11 DR. EISENBERG: The PMN is one area that they want
12
to start focusing on in the future, primarily section 5, as
13 I recall, PMN requirements, where, they see a future on the
14 enforcement side, information not being submitted.
lo I mean, it is very difficult going through records
16 and, in fact, determining whether, in fact, there is a
violation on the section 8 ' s.
18
In fact, their sources of information for that,
19 where those would be coming from would have to be perhaps from
other agencies like OSHA or perhaps from labor unions.
21 MS. KINNEY: Other questions?
oo
If not, let;s go on to section 5 work group.
MS. WARREN: We had mostly an informational
"4 I
presentation also on discussion or significant new use rules.
They have had a reorganization over there which we had a
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1 presentation on in the work group the last time that we met,
2
but they are focusing on setting priorities for approximately
o
50 candidates for significant new use rules which they
4 refer to as the SNURQUEUE, which sounds' like a disease.
All of the chemicals that they ..are presently
considering for significant new use rules are chemicals
that are passed through the PMN process. They are not
focusing any attention on significant new use rules for
9
existing chemicals.
That was very clear. They have shelved the idea
of a generic new use rule and they are proposing now to
12
establish a general policy, a policy statement for signi-
13
ficant new use rules, which could be followed their
''.. ".. ..' " ''.'. . .: '''''' ':''.'-:'.'. ..'.':.' " "<
thinking is so rough on this, even though they have been
going around and around on it in the past, but they are new
16
people for one thing, and they said that a new use rule
could be done after the policy is proposed, but they are
18
looking for policy available for publication by this
19
summer. r>
20 ,
They have four candidates in addition to the one
21
chemical specific that came out in the Federal Register
which says that there is nothing presidential about what
23
they have proposed there, and the four that they are
24
considenna are three intermediates and a flame retardant
25 il
: chemical.
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They wouldn't give us much information about
them. One thing they asked, because they are just starting
to think about a significant new use policy should be,
they would like to get the advisory committee involved,
which is a new and different approach for the agency.
Ordinarily we have been coming in after the
fact, after a proposal is already out for comment. And
a
they asked if we would address two particular questions.
9
One is what criteria should be used to set
priorities for the candidates that are in the queue of the
significant new use rules and then the second question is a
12
broader one, which is what ought to be the triggering
13
criteria for issuance of a significant new use rule and how
14' . . ....... . .
do you decide when a significant new use rule is appropriate.
15
They told us I asked them to look back through
16
whatever sort of white papers or whatever they might have
r.
prepared I mean to ask us to do that, people who may not
18
have thought about it before, and we have no indication of
19
what their thinking is, we got the impression it was because
20
they hadn't decided what they were going to do at all.
21
They said if there were such documents they would
get them to us shortly or otherwise say they are not
23
available. I would like to put that on the agenda for
24
the next meeting.
i
25 ;
It is an area that we have urged them t;
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involved and get going on and now they are preparing to do
2
that and would like input from us.
3
MR. MOONEY: We have pounded on them often enough
to give them some indication.
MS. KINNEY: Could it be done better by the
6
section 5 work group than the full committee?
MS. WARREN: I think it could be done by the
8
work group, but the work group is rather small at this time,
9
MR. MOONEY: You make the point there is a lot
10
of heavy lifting there and Jacky and I can reflect on being
11
part of a conservation foundation sponsored group that
12
addressed those criteria and I suppose we put the better
13
part of five full working days in a series of meetings of .
14., ' .... ..:'.' . ' -..-...: -'....-.'.' .'.'''..': ' .,::.'.':..,.:' '..
exploring that issue, like testing categories, it i's'not
15
simple.
16
It is going to be tough to do a consciencious
17
job on it.
18
MS. SMALLWOOD: Could the workings be brought to
19
bear?
20
MR. MOONEY: The end product certainly can be
21
shared. It was delivered to Mr. Jelenick.
09
MS. WARREN: It was delivered to Mr. Jelenick's
wastebasket a few months ago. i
24
MR. MOONEY: That may be, but he developed a
response to it, a commentary on it. It would be a starting
Acrrsa Saoorfinq Comocny
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V /*./
point. That was a group of environmentalists and industry
2 x v '
people trying to find a concensus 'position. It might be
2
worth looking at at least. ^
MR. LENTZ: . Did they reach a consensus position
or come close?
6 MR. MOONEY: Yes. I leave it to the reader to
decide how much substance is in the position. We all sign
a
off on the document that eventually went to Jelenick.
9
MS. RAMSEY: That was a year ago, wasn't it?
10
MR. MOONEY: No. As a matter of fact, it was
delivered to Snteve either at the very time that we had the
12
meeting of this group in November, I think-was when it was
13
MS. SMALLWOOD: You mean this past November?
14
MR. MOONEY: Yes. But it can turn into a real
15- . - ' ':.:-.'..'' '-. ''/. '' .'. .' ,'.:"-. "'-.".'' :'-:.- ' '':'. ' / .' .".' .''.' '.."
exercise trying to think 'the thing through. It is kind of
16
fun, but we could do that. At least it would give the group
17
someplace to start.
18
MS. RAMSEY: I will look through my files.
19
MR. MOONEY: It would have been a transmittal
20
from Sam Gusman to the foundation.
21
MS. KINNEY: From conservation foundation.
22
MS. WARREN: I think that is an excellent idea.
23
The reason I asked if they had any papers reflecting
24
something that they were doing was the very problem that we
/ '
25 ; 7 !
have to start from square one and it is much easier to get |
i '
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somebody else's thoughts on it.
MS. KINNEY: Do we want to do that as a full
3
committee next time or would you prefer, say, to have a
section 5 working group work on it next time and perhaps
present recommendations to the full committee at the next
6
meeting or have an interim meeting even of that smaller
7
group between two of our full meetings?
8
It doesn't have to be limited simply to the people
who were
10
MS. WARREN: Do we have the wherewithal to do that?
MS. RAMSEY: It depends on who comes and from
12
where.
13
MS. WARREN: I am happy to do that, but not if it
14 . , , '
is. only two people. . . ..... ,-.,..,.
15 " ''''' " '
MR. LENTZ: Yes. We need enough people to
16
contribute to it to come up with something worthwhile.
17
MR. MOONEY: We have a remarkable number of people
18
in our testing group. If you think you can resolve
19
category to my satisfaction, I will shift over.
20
DR. MOSES: It will move quickly.
21
MR. MOONEY: Now I am afraid to leave.
22
MS. KINNEY: Since you are the one who was the
23
moving force behind trying to address categories, the
24
principal of selecting categories for that group next time,
25
Tom, I suggest you stay with that group. But I think there
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may be others there who would be interested in shifting over,
people like myself, who don't have the scientific expertise
to participate in that discussion might be able to parti-
cipate more fully in this.
DR. SOBRIAN: Salina is in that group; isn't she?
MS. KINNEY: She is in testing.
DR. MOSES: Where is Janet?
8
MS. KINNEY: She has been in section 6.
MR. MOONEY: All by herself.
10
MS. SMALLWOOD: No. I was in it with her before
11
two of us.
12
MS. KINNEY: Who would.be interested in working on
13
the significant new use rule, the two issues Jacky mentioned?
14
MR. LENTZ: I will continue on it.
MR. BULLINGTON: I will.
16
MS. KINNEY: And I will. So that would give us
three people. So, Frances, Al, Jacky and Check and myself.
18
MR. LENTZ: I think the timing of this sounds
19
like it is very good, that we really do it because the
20
way they are speaking is that they are going to have a
21
first rough draft, if you will, in March, that is going to be
oo
laid on Ed Cline's desk and our meeting is in March and he
is shooting for a June or summer deadline for something to
ccrne out.
So it sounds like it is an opportunity to make seme
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124
input at a policy making stage.
MR. KINNEY: I think that is good, because we have
3
been pushing.them to give us more opportunities like that.
Any other discussion on your group?
MS. WARREN: Yes. We, then, because of their
seeming reluctance to consider existing chemicals, whatever
considerations there are regarding significant use of the
o
existing chemicals, we developed a little resolution to
9
encourage the agency not to focus exclusively on new
10 ,
chemicals.
There are a lot of problems with trying to address
12
the whole question of significant new use on existing
13 '
'chemicals. Very practical kinds of things like not knowing
what all the other uses are of a chemical so that you know
15
whether something is in use or not.
1 fi
The information just isn't available. Let me
read the resolution. ATSAC recommends that the development
18
of agency policy on significant new use rules should consider
19
new uses of existing chemicals as well as new uses of new
20
chemicals. In devising a policy governing significant new
21
use rules for existing chemicals, the agency should consider
00
identifying priority candidates for significant use rules
23
using such authorities as the section 5 (b)4 risks list and.
section SA.
25
If vcu rsrr.ernber, triers was a section 8A ruis that
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125
circulated around with 2300 chemicals on it, the purpose of
which was ultimately to identify high priority candidates
3 for whatever they would do with the regulation.
4 Since the whole universe of existing chemicals is
difficult to attack, they thought we ought.to focus on ones
6 for which there is existing concern. They are already
7 doing that, I guess in section 4 of the ITC regulations.
8 ATSAC recommends that the development of agency
9 policy on significant new use rules should consider new
10 uses of existing chemicals as well as new uses of new
11 chemicals.
In devising a policy governing significant
13 new use rules -for existing chemicals, the agency should
14 consider identifying priority candidates for significant
lo new use rules using such authorities as the section 5(b)4
16 risks list and section 8A.
1( Do you have any questions about it?
18 MS. KINNEY: Do you want to move the resolution?
19 Is there a motion that we adopt the recommendation?
20 MS. WARREN: I so move.
21 MS. KINNEY: Discussion?
If not, all in favor say "aye".
All opposed?
The recoirjnendaticn is adopted.
MS. WARREN: Then the second thing that we talked
-------
12$.
about Was the status of the pre-manufacture notice program.
9
You have now gotten the status report that the program
3
prepares and if you turn to the last page, page 9, the figures
4
on the number of PMN's coming in with no toxicity data
continue to be really astonishing to me.
6
If you look at the last number in the last column,
66 percent of the pre-manufacture notices they received in
8
1980 had no toxicity data submitted with them. Two other
9
significant figures there are a lot of significant
10
figures on that page, but category A-l, which is the
largest chemical companies doing business over $500 million a
12
year, 47 of the 130 PMN's that came from that group have no
13 ..
toxicity.-data,and.-.category,B-'l .is,..diversified -companies ; ..
who have significant other business than chemical, also
15
over $500 million a year.
16
Ninety-four of the 121 companies have no toxicity
1" '
data. I wanted to bring that to your attention because it
18
is something that the committee has talked about in the
19
past, the fact that the PMN program continues to not provide
20
incentives for companies who develop data.
21
The agency just published on Tuesday the section 5
22
guidance, which is a policy statement, in effect. They don't
23
even say that it is open for comment. It is basically
24
the OECD minimi1-p. base set data, but the agency hasn't made
! ''
25 :
clear what the impact of that policy statement really is.
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8
9
10
11
12
.13
14
15
16
17
18
19
20
21
23 ,
127
MR. BULLINGTON: I think you are still assuming
here that a lot of the PMN's have a reasonable risk associated
with them.
MS. WARREN: How do we know, when there is
absolutely no. .information, no LD-50's, no nothing?
MR. BULLINGTON: It is obvious that you haven't
looked at the PMN's that are coming in and you are judging
the work of the group on this.
DR. MOSES: This is from EPA, isn't it?
MR. BULLINGTON: Yes. The ones that they have
question about, they are rejecting, isn't that true?
MS. WARREN: No, they are very upset about-this,
as a matter'of fact.'
MR. MOONEY: We have to recall that Mr. Jellinick
said at our ATSAC meeting in November and Mr. Muir, again,
said at a seminar last week that section 5 is one of the
success stories of TSCA implementation.
You may take issue of his position, but that has
been publically stated and I find that interesting because
one could argue that this apparently has proven to be an
impressive piece of regulation.
If it has been a success, how can we continue to
{claim that the whole thing is a disaster?
MS. WARREN: You accept their position as a
success.
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128
DR. SLESIN: For the longest time, the fact that
they got the inventory out was the success of the program,
3 of the whole program, and certainly the section the
4 inventory can be viewed as being part of the process, and
certainly up to last year, that was the success of TSCA
program, was issuing the inventory.
MS. KINNEY: I think the real problem from a
8 public perspective in assessing what is happening is that so
9 much of the information on those pre-manufacture notices
10 has been claimed confidential, so it is impossible for us to
11 assess whether it is reasonable for 66 percent of them to have
12 come in with no toxicology data.
13- . '":.' MR. BULUNGTON: 'Didn 't he -say'the other day that
14 if they felt that the information was inadequate they were
15 going to return it and say that we are not even putting the
16 clock in motion?
17 That is what they told us at the last meeting.
18 MS. KINNEY: That is if they feel that they
19 haven't adequately complied with things in the statute as
20 far as what has to be contained in a PMN.
21 MR. MOONEY: In terms of insufficiency of data
for purposes of involking section 5E, if it is insufficient
in the context of evaluating unreasonable risk under the
statute, then they ought to be using 5E mere than they have,
They seem satisfied with the extent to which thev have used
-------
129
section 5E.
MS. WARREN: They said they would budget it with
manpower with the capability of handling 200. They are
getting twice that number. They have gone back to the
companies who have come in with no data and I guess have
6 gotten enough to satisfy them, but they also said the public
7 is not even getting what they expect at the level of 200 a
8 year, that because of that in fact, Ernie Rosenberger
9 said, I am surprised the program hasn't broken down because
10 of the large numbers.
11 MR. BULLINGTON: Can we look at the minutes of the
12 last
13 . . .... MS... WARREN: .-. :I am 'reporting-.what, was -said- to -us
14 today in the PMN work group. It may be different from what
15 they said to us two months ago, but it is what they said to
16 us today.
17 DR. EISENBERG: I think your statement about the
18 fact that 66 percent of the submissions don't have any
19
toxicity data and you find that alarming-, when we talked
about this in the past, and even what Al was getting at was
21 the fact that you may not need toxicity tests of all the
chemicals, but I think what we were after was if, in fact, thei
i
firm did not submit any toxicity tests because they felt j
01
for whatever reason, the least they could do is indicate
why in their opinion they felt it wasn't necessary to run it
i
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\ 130
on these compounds because of information they may have on
\
similar compounds and what they know .about it or whatever.
3
As long as they submit their rationale, their
reasoning for not doing the tests themselves, why they felt
it wasn't necesaary.
MS. KINNEY: You see, if they get that with the
OECD guidelines.
8 MR. MOONEY: They won't.
g
DR. EISENBERG: When they say that no toxicity
data is received, does that mean
MR. MOONEY: Max is asking for a'risk assessment
1°
and the OECD guideline or base set is not a risk assessment.
13
If ...people were .to provide -the .QECD.-base.,;..you;.still have; the.: .
14
issue of risk assessment, that is part of the evaluation.
15
DR. EISENBERG: I am not sure I am getting into
16
risk assessment, per se. There is a reason why the toxicity
i
data is not submitted, either because they chose not to run
18
the tests for no reason at all or they felt that it
19
wasn't necessary to run it because of the information they
20
knew or because of some literature surveys that-they have
21
done or whatever.
99
MR. MOONEY: I submit that that is, in fact, a
!
23
risk assessment data. /
/
MR. 3ULLINC-TON: Is that tcxicity data?
MR. MOONEY: Mo.
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DR. EISENBERG: I don't think it is fair for you
to put a label of risk assessment on that because that
connotes a higher level of testing than I am referring to.
MS. SMALLWOOD: You are really saying they either
have done the test and are not reporting it or they haven't
done the tests
DR. EISENBERG: For whatever reason.
Q
MR. MOONEY: Doesn't the testing and not reporting
9
it a violation of the law?
10
DR. EISENBERG: I am referring to the situation
where the tests were not run for whatever reason. Whatever
12
the reason is, if, in fact, they felt that it wasn't necessary
13 ...
..to., run .it, then they ought, to. say why. :. :=.'.-, .... ..-.- : " -..
14
MS. KINNEY: I think Tom is giving a literal
interpretation of the law and he is right, there is nothing
16
in section 5 that says if you didn't'do this testing you
17
have to submit your reasons why.
18
It seems to me that a manufacturer who wants to
19
assure that he doesn't get a phone call saying there may be
20
a 5E action because there is insufficient information here,
21
just to avoid that may well want to say I haven't done these
99
tests, because, and that would seem to be the prudent course
23 !
for a manufacturer.
24
DR. EISENBERG: On the other hand, though, the
manufacturer won't do that unless there is an action on
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EPA's part. If you say a phone call, the point is they are
getting so many PMN's they don't have time for that anymore.
3
On the other hand, if they don't consider an
application until that is submitted along with it, that is
something else. And we talked about that last time, what
do you consider a completed application.
When does the clock start running?
MR. MOONEY: That, of course, is one of the key
9
bones of contention in the rule making on section 5 that is
10
not yet finalized, the issue/of invalidity.
11
DR. EISENBERG: Yes. If nothing is submitted
12
whatsoever, why should that be considered an application
13
that the clock starts running on.
14
MS. KINNEY: Because the section 5 criteria,
15
the items in section 5 only, say that if you have toxicity
16
data, you have to submit it, or if you are subject to a
11
testing regulation, you have to submit it.
18
But the problem,and one of the problems Jacky
19
has been alluding to, is in a sense section 5 may provide an
20
incentive not to do testing, because if you don't do testing,
21
you don't have to submit anything and you may slip through
90
without them noticing anything about you.
23
A lot may be manufacturers doing what they think
24
is the most prudent thine for them.
25
DR. SLESIN: Saying that "EPA has the 5E option and,|
I
v ;
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therefore, they are in compliance when the 5E option is not
involked, disregards the fact that EPA has said on
numerous occasions that they have the funds to do three or
four or five actions a year.
Here is an example of industry voluntary compliance
6
with the spirit of the act versus forcing through regulation,
8
a 5E regulation, which is an expensive action if we can
believe what EPA says, you are saying they must do this, they
gets through the gate. j
j
MR. MOONEY: I suggest you put to Warren Muir j
tomorrow the question of whether or not EPA thinks something
.has gotten through the-.,gate... :l...^doir'.t."think-.he. c-an say.?-- . -.-/.
they have been derelict if they have, in fact, let some
things through the gate.
MS. KINNEY: I think we are talking about an
example of why category test rules are terribly important,
if you are going to get toxicity data.
DR. SLESIN: It seems to me if there is no
compliance on the OECD proposal, then America is in violation
of an international agreement of some kind. A promise
was given at the HLM that we would start getting them the
basic test data and it is clear that 66 percent I believe
i seme of them don't need it, but 66 percent don't require any
I
i
! data a^ all. Do you believe that?
-------
1 MR. BRAITMAYER: I think one of the problems
2 that we have here is that, you know, the inaction of the
3 agency with regard to the minimum base set tests and industry
4 has not been told, and the one problem that we face is
5 indecision, and not knowing what to do.
6 We can deal with specifics if we know what they
7 are. We may not like them, but at least we can make some
8 judgments. And without anything specific, and if you can
9 submit it and get it at least on the docket without tests,
10 there are many that will try that.
11 There are others that will have a higher standard
12 of compliance with intent of the law, but until it gets
13 specific and uniform, I think it is going to be extremely
14 "'difficult to get this high' level-of compliance, because
15 nobody knows what it is they are supposed to be complying
16 with.
^ DR. SLESIN: 177 of these there is no information
18 in the public record in the first place as to what they are
19 going to be used for. It is really hard to make a risk
20 evaluation without
21 MR. MOONEY: Hard for you to make a risk evaluation
09
DR. SLESIN: Absolutely. Hard for any of us,
23 in .fact. ' i
i
24 MR. MOONEY: Apparently not for the EPA. . j
or
! DR. SLESIN: we are saying we would like to see mere
i
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data. There is not even generic use information, which is
part of the rule. If you keep the use confidential, you are
2
supposed to say what the generic use is.
MR. BULLINGTON: Have you seen the reports? You
are making some assumptions.
c
DR. SLESIN: It is right in front of you, page 3,
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
09
in terms of the use.
MR. MOONEY: I suggest you might want to take a
look at how many of these are high molecular weight polymers,
how many are small volumes, the kind of things that would
have been exempted under the European system.
DR. EISENBERG: We can ask Warren tomorrow.
MR. MOONEY: I think he..will,.agree with , . . .
Lou's contention that there isn't enough data coming down.
MR. BULLINGTON: Looking through the bills,
I saw one that gave confidentiality to everything. Why
they didn't kick that out
MS. WARREN: They say if you knew what we know, it
is a miniscule quantity, an inoculous polymer, fine. A
member of the public from whom a lot of relevant information
has been withheld, I have to conclude that these figures
say to me that industry is not doing what they said they.
would do.
On its face, I have to look at 'this and say 66
25 i!
j percent, no toxicity data at all, no explanation. There is
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a doctrine in the law that says the thing speaks for itself
and I think this is an example of that. I have to be
persuaded to the contrary.
MR. BRAITMAYER: I also feel that if this base
set is established, I think you are going to see a
different picture in the future. Because that gives the
agency the grounds to say, look, you haven't complied, it
8
is back in your lap.
9
Since we haven't had that yes, if you call
10
them up, since May, I believe, that they would tell you that
that is what you ought to be doing, if you ask their advice,
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but there hasn't been any formal definition of this.
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Now; ;I .-think ..it..is going:-'.to rbe,-mor-e ;o.n--the:., t.able^ -
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and there will be.
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MR. MOONEY: There are some very interesting
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legal questions here. Lou brought up the point about this
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OECD commitment, the issue of a decision which has not yet
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been taken by the council to endorse the MPD or base set,
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presumably it will be, but it is interesting to contemplate
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what is the burden on the U.S. as a consequence of an EPA
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concurrence in a decision under OECD, when its own statutory
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authority is, at least on the face of it, seemingly,at odds .
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with this mandatory concept of a base set.
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It is mandatory under the 6th Amendment for
chemicals in excess of one ton.
A cm a 3 a sort in a Com-rarvr
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137
1 MR. BRAITMAYER: With all the legalities aside,
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from a practical standpoint there has got to be a worldwide
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approach to this. It is going to shake out-one way or
another.
MR. MOONEY: I suspect it will.
MS. KINNEY: Is there any other discussion on
section 5?
MS. WARREN: No, I think that is it.
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MS. RAMSEY: If you have that resolution which
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has been adopted, I will get it typed.
MS. KINNEY: Let me just announce a couple of
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changes in the schedule tomorrow morning. Actually, there
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is no . why don'.'.t.we "say that w.e 'will meet -.at, 8 : .45 'tomorrow
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morning, since we have already discussed our resolutions and
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what we can do between 8:45 and 9:00 o'clock is discuss the
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minutes and approve those.
Warren Muir will be here at nine o'clock tomorrow
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instead of 9:15. A meeting with the Acting Administrator
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has been moved up until ten o'clock for him, so he will be
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here only from nine to ten.
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MR. MOONEY: Who is the Acting Administrator?
MS. WARREN: Barber.
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MS. KINNEY: Administrator for a day.
After Warren leaves, Carol Bastion and Ed Cline
will be here to continue the discussion that he started and
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also to talk about CFC's. She is the person who was with
CEQ. She may still be there. I think she is coining
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specifically to talk about CMC so it may be that she has
come here and is working on the CMC rule.
We will start at a quarter of nine tomorrow.
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Any other discussion?
DR. SOBRIAN: You wanted to put the discussion of
the response to the four year report somewhere on tomorrow's
agenda. Do you know where?
MS. KINNEY: Have people had a chance to look at
that today or before they came?
It was sent to us in the mail.
'. v -.' " DR.'MOSESV: 'Yesv '-:Vr' got'-iti'" ' : '";:: ''"" ; ";M-' '; '"
MS. KINNEY: Why don't we let's go ahead, then.
I take back those 15 minutes of sleep I gave you.
MR. MOONEY: Can we vote on that?
MS. KINNEY: One thing, let me ask you, do we want
Steve did send out written responses to the four year report.
Those responses were very similar to what he gave in his
oral presentation here.
Do you all want to address those?
Do you feel any need to?
MS. SMALLWOOD: Maybe the question is since I
! '
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raised the question about do we want to deiI with them, maybe j
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the first question is what would happen once we went over !
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them again?
What use would it be?
We know what he said and we have read them and
all of that. Is something going to happen that will make a
difference?
c
Maybe we should forget it.
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MS. KINNEY: I think that is a very good point,
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and I quite frankly don't know that there would be
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any future action that would be appropriate on our part.
MS. SMALLWOOD: Then forget it.
MS. KINNEY: One other thing that I would like you
to be thinking of tomorrow, quite frankly, I don't feel at
this point like .I .am ready to take any position..on the :... .;.. ...
various recommendations that were made in the innovation
policy study we discussed this morning.
MS. SMALLWOOD: Me, either.
MS. KINNEY: If people would be giving some
thought to whether they do want to try to address those,
either tomorrow or in a future meeting, we can talk about
that tomorrow morning.
MS. SMALLWOOD: Then I will raise that same questio
what is going to happen
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MS. KINNEY: I think that is something that is
currently before the agency right now. They are in the process
ij of trying to decide what they want to do, and so some kind of
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recommendation from us would be something that could be
useful.
MS. SMALLWOOD: That has some validity, okay.
MR. MOONEY: There is a whole transition going on,
too. Even if this were a year ago and you raised that
question, it would be hard to forecast what good it does,
but right now it is really up in the air.
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MS. SMALLWOOD: Since they don't have a secretary
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for this unit yet? v
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MS. KINNEY: They don't even have an administrator.
MR. MOONEY: Marcia is setting policy at the
moment.
MS. RAMSEY: Watch out. Here I come.
'' '. '.'MS:.-. SMALLWOOD': ' As ibhg.:as you ' 'don't' implement it,'
right?
MR. LENTZ: You have been around too long,
Jessie.
DR. SOBRIAN: Two meetings and she knows.
MS. RAMSEY: I think while policy is being
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discussed and established, I don't think it would hurt
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if ATSAC has a position and some recommedations. I certainly
thing it would be helpful to make them sooner rather than
later.
MS. SMALLWOOD: You are talking about on the
;| innovative policy one?
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DR. MOSES: As a subcommittee and not: as a
group you are talking about?
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MS. RAMSEY: Yes. It would probably have much
4
more effect.
MS. KINNEY: Any other discussion?
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MS. SMALLWOOD: I move adjournment.
DR. EISENBERG: Second.
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MS. KINNEY: We are adjourned until 8:45 tomorrow
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morning
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(Whereupon, at 4:50 p.m. the meeting was adjourned.
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142
REPORTER'S CERTIFICATE
DOCKET NUMBER:
CASE TITLE: Committee Meeting
6 EEARING DATE: January 29, 1981
7 LOCATION: Washington, DC
8
9 I hereby certify that the proceedings and evidence
10 herein are contained fully and accurately on the tapes and'"-'-
11 notes reported by me at the hearing in the above case before
12 United States Environmental Protection Agency
Administrator's Toxic Substances Advisory Committee
13 and that this is a true and correct transcript, of the same.
14
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16 Date: 2-6-81
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09
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20 Official Reporter
Acme Reporting Company, Inc.
21 1411 K Street, N.W.
Washington, D.C. 20005
Asm a ;t=ccrr!nc: Csrrs^
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