Revised Chemical Data Reporting Begins in February
Environmental Law Alert 01/18/12 Peter A. Tomasi
It's that time of the decade again.
The five-month period to submit required reporting under the Inventory Update Rule, now known as the Chemical Data Rule ("CDR"), begins February 1 and runs through June 30. EPA finalized the CDR on August 16, 2011. 76 Fed. Reg. 50,816. The CDR requires manufacturers to report information to EPA regarding the volume of commercial chemical substances and mixtures manufactured, processed, and used by facilities located in the United States. The rule has changed significantly in the five years since reporting was last required in 2007, and the vague nature of the guidance provided with the rule has lead to concerns from some in Congress that EPA is setting industries up for enforcement.
Required under Section 8(a) of the Toxic Substances Control Act, the intent of the rule is to allow U.S. EPA to develop a comprehensive database identifying the universe of chemicals produced throughout the United States. The first iteration of the rule was issued in 1986 and only required reporting of organic (carbon-containing) compounds. However, revisions to the rule in 2003 and 2005 expanded the number and types of chemicals that must be reported to include inorganic compounds, including metals and minerals.
The CDR requires reporting of chemical production volumes for 2010 and chemical production, processing, and use information from 2011. The CDR also requires the reporting of byproducts that are being recycled or reprocessed. Under guidance issued by the agency with the rule, byproducts such as metallic or coke fines, as well as spent solvent solutions may be considered chemicals "manufactured" by a given facility and may require reporting under the rule. Industry sources have expressed concern over the scope of reporting required by the CDR, and EPA is being pressed by Congress for allegedly failing to provide guidance on what materials should and should not be reported. As noted in a January 13 letter from Representatives Fred Upton and John Shimkus to Administrator Lisa Jackson, EPA personnel were unable to answer a half dozen questions posed by industry during a November 16 webinar on the rule. According to Upton and Shimkus, EPA staff declined for over a month to answer questions regarding the type and scope of byproducts that must be reported under the rule because EPA had not yet reached consensus on the issue, because the answers were "context specific," or because appropriate staff were not available to address the questions posed. (EPA has since announced that it will be posting additional information online by February 1 to provide guidance for manufacturers and recyclers to understand reporting obligations, including recycling of byproducts.)
This lack of guidance places companies subject to reporting in a difficult position. On the one hand, failure to submit a report required under the CDR, or submission of an incomplete report, may expose a company to civil penalties or possible criminal enforcement for knowing and willful false submissions (including false confidentiality claims). On the other hand, the very detailed information required by the rule will be made available online, allowing competitors and others to view production data, and without any context to inform facility neighbors or concerned citizens about the way that manufactured products are handled. While EPA's promised guidance may clarify some issues, the complexity of the rule means that there will still be significant uncertainty regarding the scope of required reporting.
Unless delayed by EPA, as noted above, 2011 CDR reporting must be completed by June 30. If you have questions regarding whether your company is required to submit a report under the CDR, or regarding completion of this year's CDR report, please contact Peter Tomasi at (414) 277-5677 or firstname.lastname@example.org.