Document MJy2zoyEbm0RBqogvE5jR87Bj

'I* AGENDA MEETING OF THE CMA BOARD OF DIRECTORS 2:00 p.m., Tuesday, October 28, 1980 West Alabama Room, Galleria Plaza Houston, Texas 2:00 p. m. 2:01-2:02 2:02-2:12 2:12-2:17 2:17-2:47 2:47-3:07 3:07-3:37 3:37-3:47 3:47-3:57 3:57-4:02 4:02-4:07 4:07-4:15 4:15 1. Opening Remarks and Introduction of Guests -H. Barclay Morley 2. Approval of September 9, 1980, Meeting Minutes -H. Barclay Morley 3. Report of Executive Committee -- Paul F. Oreffice 4. Treasurer's Report -- G. C. Herrman 5. Association Activities: a. Guidelines for Special Projects Advisory Group -G. V. Cox b. Status Report of Hazards Communications Special Committee -- W. C. Krumrei c. Superfund: Status, Outlook, and Activities -Louis Fernandez d. Environmental Management Committee and Hazardous Waste Response Center Program Recommendations -- C. L. Sercu, Dow Chemical U. S. A. e. ChemCAP Status Report and Program Review.Plans J. N. Sites f. Report of Director of Government Relations - W. M. Stover g- Report of General Counsel -- E. B. Frost 6. New Business 7. Adjournment TAB 1 2 3 4 5 6 7 Next Directors' Meeting: 8:00 a, m. , Monday, January 5, 1981, Ocean Reef Club, Key Largo, Florida CMA 037643 2130 MINUTES of the two-hundred eightieth meeting of the Board of Directors of the Chemical Manufacturers Association, Inc., held at the Galleria Plaza Hotel, Houston, Texas,' Tuesday, October 28, 1980, at 2:00 p.m. Directors: H. Barclay Morley, Chairman William G. Simeral, Vic Chairman Richard C. Ashley William G. Kay, Jr. Dexter F. Baker John Morrisroe Charles E. Brookes Paul F. Oreffice Harry W. Buchanan L. John Polite, Jr. Carlyle G. Caldwell Seymour S. Preston III Robert S. Dudley Toy F. Reid Richard E. Engebrecht William C. Roher Louis Fernandez Robert A. Roland William J. Ferracone John P. Sachs Robert W. Gerwig Harold A. Sorgenti Arthur L. Goeschel Alfred C. Stepan, Jr, James B. Henderson Allan J. Tomlinson Richard J. Hughes H. Kent Vanderhoef William B. Jackson Konrad M. Weis Leo H. Johnstone Harriette F. Witmer Emerson Kampen Louis G. Zachary Secretary: - General Counsel: Treasurer: Bruce M. Barackman Edmund B. Frost Gary C. Herrman By Invitation: Warren M. Anderson, Union Carbide Corporation Geraldine V. Cox, CMA Richard F. Gold, Stauffer Chemical Company W. E. Kennel, Amoco Chemicals Corporation W. C. Krumrei, The Procter & Gamble Company James N. Sites, CMA William M. Stover, CMA 1. The meeting was called to order by Chairman Morley. 2. APPROVAL OF SEPTEMBER 8, 1980 MINUTES Minutes of the September 8, 1980 meeting, as distributed, were approved. CMA 037644 3. TREASURER'S REPORT Mr. Herman's report is attached as Exhibit A. He noted the following significant items: Our latest financial results are through the end of September. These have been mailed to the full Board. They indicate total operating results are tracking fairly closely to budget. For the first ChemCAP assessment (which was billed in January of 1980) we have received S2, 523, 300 as compared to the budget goal of $2, 555, 000. The second assessment (which is designed to raise $3, 600, 000) will be billed in December with a due date of January 1981. The budget process for next year is already underway. Part of the standing committee reports were made to the Board in Septem ber and the remainder will be made in January. The Board Review Committees are scheduled to meet in November and Board members are urged to attend. The preliminary budget for next year will be presented to the Finance and Executive Com mittees in March and the proposed budget will be presented to the full Board in April. 4. REPORT OF ACTIONS TAKEN AT EXECUTIVE COMMITTEE MEETING___________________________________________________ Mr. Oreffice reported the following actions taken at the Executive Committee meeting the preceding day: Approved Special Projects Advisory Group (SPAG) guidelines, charter, committee nominees and staff expansion. An approved addition to the guidelines would provide for an annual review by SPAG concerning panel terminations. The Executive Committee will receive recommendations and approve terminations. Approved the Hazards Communications Special Committee recom mended principles for use in alternative guidelines and discussions with government agencies. e Heard a status report on Superfund. Approved appointment of members to the Public Risk Analysis Special Committee. CMA 037646 2132 Heard a status report of the State Activities Special Committee. Specific recommendations regarding a program of work will be considered as part of the regular budget process. Approved a CMA Groundwater Policy as recommended by the EMC. Exhibit B. Heard without objection the position the Association proposes to take regarding the definition of "processor" as used by EPA in regulations promulgated under various provisions of TSCA. CMA will stay out of this issue. Noted an advertisement relating to waste disposal sites to be run in The Washington Post and The Washington Star, which repeats a New York Times editorial on "Those Disastrous Studies at Love Canal" --- thoroughly discrediting them. Exhibit C. 5. ASSOCIATION ACTIVITIES (a) Guidelines for Special Projects Advisory Group (SPAG) In introducing Exhibit D, as modified by the Executive Com mittee, Mr. Roland emphasized that while SPAG was created originally to undertake properly coordinated advocacy under certain conditions following CMA administered research, what is now contemplated is that an existing technical research program is no longer a prerequisite for consideration of a proposed single-product advocacy program, i. e., the guidelines cover single product research and/or advocacy programs. Mr. Roland then described the concern which has been expressed for the proliferation of ad hoc single-product splinter groups, outside existing organizations, whose actions may adversely affect the continuity, consistency of position, and long-term litigation plans of CMA or allied organizations. To the extent that it is possible to do so, single-product advocacy groups should be brought under the umbrella of existing trade associations. SPAG provides a good mechanism for CMA to respond, on a selfliquidating basis, to the need for product advocacy on behalf of its members in those cases where the matter is of sufficient import ance from a precedent-setting viewpoint. ON MOTION, duly made and seconded, it was VOTED: To approve the recommendations CMA 037646 contained in Exhibit D relating to the SPAG program, including the guidelines as modified by the Executive Committee. After reviewing the drawbacks associated with splinter group activities, Mr. Morley requested that member companies insist, unless events dictate otherwise after careful review, that the mechanisms provided by CMA or other major associations be utilized in single product ad vocacy. In this connection he advised that an interested party need not be a member company to be included in SPAG programs. (b) Report of Hazards Communications Special Committee A status report, together with recommended principles for use in alternative guidelines and discussions with government agencies concerning labeling proposals, as approved by the Executive Committee, Exhibit E, was distributed to those present and received without objection. Mr. Krumrei's remarks are attached as Exhibit F. (c) Superfund: Status, Outlook, and Activities Dr. Fernandez referred to Exhibit G which provides a summary of the status of Superfund legislation. He advised that although no bill has been passed by the Senate as yet, we can't afford to become complacent. Since no one can predict what might happen in a lame duck session of the Congress, it is planned to convene a small advisory group within CMA immediately after the election to plan ongoing strategy and tactics. The media is expected to increase its efforts to push for Super fund legislation and there will be a continuing need for full in volvement of member companies in grass roots efforts to prevent Congress from enacting legislation even more onerous than that represented by the two House bills H. R. 7020 and H.R. 85. (d) Hazardous Waste Response Center (HWRC) An update of the HWRC program including new'operating guide lines, Exhibit H, was received without objection. CMA 037647 (e} ChemCAP Status Report and Program Review Plans Following Mr. Sites' remarks. Exhibit I, Mr. Henderson reported on the results of the meeting this date of the Board's Communications Policy Review Group which was established to provide oversight of the ChemCAP program. The group reviewed where we have been and looked at what the future direction ought to be. There was unanimous and enthusiastic endorsement of the range and sweep of ChemCAP. It was recognized that we were still in a start-up phase, especially at the company level. The publications people are getting the message, but much work needs to be done in individual companies to communicate management.interests and concerns to line management in the field. They need to understand management's endorsement if the aspects of the program at the community level are to be raised to ahe.-level of activity which the program deserves. The review group has requested additional research concerning the advertising. It is hoped the results of this can be reported at the January meeting at which time the Board will be asked to act in respect to endorsing the ChemCAP program in concept (as opposed to budget} for the next two years. At this point in time the review group is very much in favor of continuing the program. (f) Report of Director of Government Relations In presenting his report. Exhibit J, Mr, Stover announced that the appointment of Mr, Johnstone to the Industry Policy Ad visory Committee, a group established to advise the U.S. Trade Representative and the Secretary of Commerce in the area of international trade, has been confirmed by Trade Ambassador Askew and Commerce Secretary Klutznick, (g) PRIVILEGED MATERIAL REDACTED CMA037S48 6. NEW BUSINESS 2135 Mr. Morley emphasized the importance of the three Board review (audit) committee meetings scheduled for November and urged the parti cipation of all committee members whose input is needed in the budget process. He also urged active participation in the January Board m eting at which time the remaining standing technical and functional committee reports will be received. During discussion it was suggested, in connection with the Board review committee meetings, that while the principal interface should be with staff, a dialogue with the chairmen of the relevant technical and functional committees would be useful. Certified correct; 1 Chairman of the Board Bruce M. Barackman Secretary CMA 037649 Exhibit A TREASURER'S REPORT Five Months Ending October 31, 1980 This report will he prepared and distributed following the end of the month. For your reference, the following is provided: e The 1980-81 annual budget as originally approved. e The reclassification of expenses to provide for the hiring of a technical writer and secretary to offset outside technical consulting. e The 1980-81 annual budget as amended. CMA EC-10/27/80 BD-10/28/80 CMA 037650 CHEMICAL MANUFACTURERS ASSOCIATION Budget for Fiscal Year 1980-81 (As amended through October 31, 1980) REVENUE; 1980-81 Annual Budget Membership Dues & Entrance Fees CHEMCAP Special Assessment Jan. 1930 CHEMCAF Special Assessment Jan. 1981 Investment Income General Meeting Income (Net of Exp.) Publications Sales Overhead Reimbursement - Special Projects TOTAL $ 8,677,300 891,800 3,600,000 700,000 129,200 22,000 400,000 $14,420,300 GENERAL OPERATING EXPENSES; General Counsel Government Relations & Econ. Affairs Communications & Public Relations CHEMCAP Technical Administration Health, Safety & Chemical Regs. Distribution, Energy, Engineering Environment & Has. Waste Center CHEMTREC Special Research Projects Executive Departtnent Finance, Accounting & Business Printing & Distribution $ 638,700 860,700 965,300 4,491,800 187,700 521,600 367,400 743,900 503,300 453,800 891,000 665,300 289,700 TOTAL OPERATING EXPENSES $11,580,200 LEGAL & RESEARCH Legal Fees & Expenses Research & Consulting TOTAL TOTAL EXPENSES $ 1,420,000 1,373,000 $ 2,793,000 $14,373,200 Contribution to Reserves $ 47,100 Approved Amendment $- - - - $ 1980^81 Budget as Amended $ 8,677,300 891,800 3,600,000 700,000 129,200 22,000 400,000 $14,420,300 $- 79,700 *e - $ 79,700 $ 638,700 860,700 965,300 4,491,800 187,700 601,300 367,400 743,900 503,300 453,800 891,000 665,300 289,700 $11,659,900 $(79,700) $(79,700) $- $- $ 1,420,000 1,293,300. $ 2,713,300, $14,373,200 $ 47,100 CMA 037651 Exhibit B EMC Recommended Policy on Groundwater Background on the Issue EPA formed a Groundwater Policy Committee in October of 1979. Their objectives were to develop a protection strategy, clarify their involvement, achieve national re cognition of groundwater problems and develop a short and long term action plan. EPA briefed industry in February, 1980 and held workshops for public participation in June of 1980. They planned to publish a national groundwater policy in the Federal Register in September and hold public hearings in October and November of 1980. Policy was delayed and is not scheduled to appear in Federal Register until January of 1981. The public hearings have been cancelled indefinitely. In April, 1980 CMA formed a Groundwater Management Task Group under the direction of the Environemental Manage ment Committee. The initial Cma position on groundwater was approved by the EMC in May. The task group's goal was to respond to EPA groundwater strategy and to recommend a CMA policy on groundwater. Using EPA's unpublished framework the task group developed a recommended policy, however, it was not restricted to EPA's options. The EMC unanimously approved the Policy on October 15, 1980. Basic Assumptions - Groundwater is a valuable natural resource defined by the National Water Well Association as "the saturated zone of a permeable geological formation, which contributes significantly to wells and springs". In some cases, societal use of groundwater has impacted the quality and quantity of existing resources. Contaminated groundwater can have a serious adverse effect on human health and can damage the environment. Proper management of groundwater is required to protect the resource. A national groundwater policy is needed to encourage and support a scientifically well-balanced management strategy which will protect human health and the environment and responsibly maintain the multiple uses of the resource for diverse societal interests. Because of the differences in quality and quantity of groundwater resources in this country, a practical approach to a groundwater management strategy would be the development of individual state programs. CMA 037652 2 CMA Policy Considerations o All segments of society have contributed to groundwater contamination. o Existing groundwater varies in quantity and quality. o Remedial in-situ treatment of contaminated groundwater is dependent on technology and the costs involved. o Some contaminated groundwater supplies may present serious threats to human health or the environment. o Maintaining multiple uses of groundwater is essential. o Existing state law on groundwater and state expertise in groundwater management should not be discounted. THE POLICY Goal o The protection of human health and the environment while responsibly maintaining multiple uses of groundwater. Management Approach o The Federal Government should identify use classes for groundwater and develop a data base on groundwater contamination and sources of groundwater pollution. o The States should use the data base to assign and classify groundwater when a need for the resource is identified, either present or projected. Technical Approach o No single technique of groundwater management is appropriate in all cases. o The States should assign a variety of protection mechanisms to groundwater supplies so that the intended or actual use of the resource is not impaired. Federal/State Role o _ States' rights to manage groundwater under existing authority must be protected and supported. o The Federal Government should only provide technical and financial assistance sufficient for the states to carry out their management program. Action Required: Approval of above outlined policy CMA EC - 10/27/80 BD - 10/28/80 CMA 037653 THE WASHINGTON STAR Th/etJay, October 30, 1980 Exhibit C ebate has been taking place in Washington throughout Dthis year on proposed legislation to create a government-run "superfund" to pay for cleaning up hazardous waste-disposal sites across the country.The Administration has urged that billions of dollars be spent for this purpose -- without first developing reli able information on the nature and"scope of the problem. The chemical industry has directly supported governmental action, but at far less cost and limited to dealing with "orphan" or abandoned dump sites -- the one problem area not covered by existing government programs. And industry has consistently urged that legislative and regulatory responses to problems of this kind be based upon sound technical and scientific data. Nowhere has this information gap between problem and .proposed solution been more starkly revealed than in the En vironmental Protection Agency's approach to the tragedy of Love Canal, as noted in the following editorial that appeared in .The New York Times of October 17,1980. \ Those.Disastrous Studies at Love Canal The latest critique otall the tnwmigedona into pa*, pie's health at Love Canal It the ant damning yut. A committM of scientists appointed by Governor Carey now condudM that bungling by puttie ted prime esagatore `fueled ratter ttaa resolved public anxi ety.'* It suit isn't dear, after two years of intense study, whether people were physically harmed by the poisons reaping cot of the ws'i abandoned chemical dump. But the damage to tbaraddents'peace of mind, and trait in government, It tmntsahahla. What ae> counts tor such a fiasco? Howcaa anottor b* avoided? A panel chaired by Dr. Leals Thomasof tto Sloan- Ottering Ciacar Cottar he* fend an tstatiahiag: tawa of scientific ad managerial incompwmet la sovwnt toy studies of tto affitfr. It CMfiimed ttata study ot alleged efBonomoo by Carp was so poorlydarigMd ttat it should never hav* been undertakes--and ttat teFedard Environmen tal PratytiopAgency wua to Marne because it failed to reentt. qualified scientist* reels* tt> wortt The panel also criticised Dr. Beverly Paigm, a consultant to Lora Canal's homeowner*. saying that bar claim ts have found evidence of bodily barm "eannoc batata sarlsly" sod baa "the Impact of polande." Dr- Thomas's panai baa harsh word* too, ibr the New York State Health Oepanmaot It la rightly to- aaedofarousing hystericaltorstwo yensago wltha bradaswttat deserted Love Canal ara*"eavtroi mantel nightmare^ threatening;"protend and deva^ rVNfl Wt I'u--r.ipi. tepnmntb, An--m tatingeffiictk.'*Thit tmaponsiblertatorlewaa appar ently designed to obtain. Fedaral disasters*!. By ttt community, it made objective sctsnflflc studies retremelydifficult. In addition. It is now plain that state tod Fdtnl officials failad to commusicata aod cooparata as public agendas should. New York's Health Department, for iastanre, tskad for Fedaral fond* for chramaoma studies but *u turaed down by the Environmental Protection Agency. Yet that agency then proceeded to sponsor its own- -- now discredited -- chromosome study, without tree consulting the state There is no excuse for ttat kind of ineobaranca in impending toapubUeamergeocy. Fed up wftt E.P.A.'* mismanagement, the Thomas panel racommanda that the Fedsnti Canterfor Disease Control or the National Institute of Environ mental Health Sciences uka charge of sadtstadfosc The proposal baa merit; bothagtnefos Inarasolid scieo. tifle reputation*. But as agency is iraouna from mv. Thi only way to pnvtnt similar fiaacocs is to require that scientific investigations affecting public senrillvW ties be thoroughly evaluated by natural esptrts before they on isfluaaee major decisions affecting public health. The failures at Love Canal have so ttRurad tte reddami there ttat they plainly qualified for special help, wtwherornor anychemicai actually burtthem. America^ Chemical Industry TV w, i< ih*Ch*niK4iNtimeAnNnsA9Bi,'uikm CMA 037654 single PRODUCT(S) advocacy Exhibit D Problem: The Chemical Industry/CMA advocacy program has concentrated pri marily on general rulemaking procedings to implement the Clean Air Act, the Clean Water Act, OSHA, TSCA, etc. The success of this advocacy program has been to neutralise adverse agency interpretations of the baric statutes. But now a wave of specific chemical rulemaking and enforcement actions threaten to wipe out gains we have made and the defenses we have built in the general advocacy program. Objective: In order to avoid Balkanization and a divide and conquer strategy on the part of Federal agencies, the chemical industry must provide for cosmunication and coordination regarding specific chemical ad vocacy. Background: The Special Programs Advisory Group (SPAG) was created a year ago to give CMA an organization capable of providing the necessary cosmunication and coordination. Over the past year, SPAG has started to consider advocacy programs and has developed proposed program guidelines. A proposed roster of new SPAG members has also been developed. With new guidelines and new manbers, SPAG will enable CMA to provide service for a number of new single product(s) ad vocacy groups. Recommendations: Approval of the SPAG guidelines and membership is recommended. In addition, it is recommended that CMA be given authority to hire new staff for the Special Programs area to the extent that such staff can be supported totally by new program funds. Impact Money: There will be no dues impact Company Personnel:Attendance at SPAG matings and Special Programs Panel Meetings Staff Personnel: New CMA Special Programs personnel will be added to meet increased workload to the extent that such additions can be supported by Special Programs funding. Action Required Approval of recommendation: 1. Approve Special Programs Guidelines (Appendix A) 2. Approve Special Programs Advisory Group Chartar (Appendix A-page A 13-18) 3. Approve SPAG committee nominees (Appendix B) 4. Approve expansion of Special Programs staff and associatad support staff based on increased workload to the extent that additions can be supported by Special Program Funding For Discussion: Splintar Group Advocacy in the chemical industry CMA EC-10/27/80 BD-10/28/80 CMA 037656 TABLE OF CONTENTS * Page I. CMA ADVOCACY AND SPECIAL PROGRAMS A. CMA Advocacy and Environmental Regulation B. The Limits of General Advocacy and the Growing Importance of Specific Chemical Proceedings C. The Need for Communication, Coordination and Cooperation in Specific Chemical Cases D. The Special Programs Advisory Group (SPAG) will Provide for Communication and Coordination and Its Charter and Guidelines Should be Approved 1" 1 2 2 2 II. DESCRIPTION OF SPECIFIC CHEMICAL CASES WHICH WILL ESTABLISH PRECEDENTS FOR REGULATION OF THE CHEMICAL INDUSTRY A. Toxic Substances Control Act (TSCA) B. Resource Conservation.and RecoveryAct (RCRA) C. Clean Air Act (CAA) D. Clean Water Act (CWA) E. Occupational Safety and Health Act(OSH Act) F. National Toxicology Program (NTP) - A NonRegulatory Activity within the Department of Health and Human Resources Having Significant Impact on The Chemical Industry 4 4 5 6 6 7 7 III. DIVISION OF BIOMEDICAL AND ENVIRONMENTAL SPECIAL PROGRAMS A. Divison Overview and History B. Staff Organization and Responsibilities C. Orientation of Panel Members D. Panel/Staff Interface E. Budget Management F. Future Needs G. Conclusions 8 8 9 10 10 11 12 13 CMA 037656 TABLE OF CONTENTS (cont'd) Table 1. The TSCA Section 4(e) Priority List Table 2. Schedule for EPA's Action on Chemicals Listed in Table 1. Table 3 . Industrial Categories for Which New Source Performance Standards are to be Developed Table 4. A Partial List of 65 Chemicals Designated as Priority Pollutants Table 5. Occupational Safety and Health Administration Table 6. Chemicals Having Substantial Evidence of Carcinogenicity; CAG List Table 7. Alphabetical Index of Chemicals Cited in the NTP Annual Plan Table 8. Biomedical and Environmental Special Programs Budget Page 1415 16 17 18 21 23 48 Figure 1. Organization of Biomedical and Environmental Special Programs 47 Appendix A. Biomedical and Environmental Special Programs Guidelines A-l Appendix B. Biomedical and Environmental Special Programs Advisory Group B-l CMA 037657 X. CMA ADVOCACY AND SPECIAL PROGRAMS The Chemical Industry is facing something new in the special programs area. No longer can specific chemical activi ties be focused primarily on scientific studies and private research. Increasingly, the generalized regulatory and policy conflicts of the 70's will be resolved in the context of regulatory proceedings directed at specific chemicals rather than in broad scale general rulemakings. It will not be easy for the chemical industry to meet the new challenge of precedent-setting rulemakings. These rulemakings, directed at specific chemicals, will present many conflicts and tensions relating to sales and marketing which are not presented in general rulemakings. This presentation will describe the problem in more de tail, present a proposed structure by which CMA can contribute to the solution of any problems, and outline the resources which may be required. A. CMA Advocacy and Environmental Regulation During the decade of the 70's Congress enacted a virtual tidal wave of environmental regulatory provisions in the Clean Air Act, the Clean Water Act, the OSH Act, TSCA, RCRA, etc. Taken together, these acts make the chemical industry the most regulated industry in the country and they could cost the industry many billions of dollars. These statutes are administered by regulatory authorities such as EPA and OSHA which have varying amounts of authority to promulgate general substantive rules to put flesh on the statutory skeleton. The Chemical Industry, in large part through CMA, has responded with a vigorous advocacy program directed at general agency rulemakings. As a part of this new advocacy, CMA has been revitalized and reorganized, its budget has been greatly increased, an in-house Legal Department has been created, and outside counsel are extensively used. Equally important is the reorganization of member company participation through the CMA committee structure. The Environmental Management Committee, CRAC, OSH Committee, and now the Special Committee on Hazard Identification play a critical role in the planning and execu tion of CMA advocacy. Member companies devote great amounts of time and talent to committee efforts. While it is yet too early to assess the outcome of the CMA advocacy effort, a pattern of success is beginning to develop. The CMA effort has blunted the adverse impact of many proposed general rules. So far, CRAC has been successful with Section 5 CMA 037658 of TSCA. The EMC has been successful in Section 311, Pre treatment, Section 307, Section 308 and Section 402 under the Clean Water Act, and in Section 4001 and 4002 of RCRA. EMC also was successful in dealing with non-attainment, PSD, and bubble issue matters under the Clean- Air Act. AIHC and the OSH Committee have had some success with OSHA in certain matters, but this agency remains industry's adversary. In labeling matters, there is hope of success with EPA, but, again, little hope with OSHA. Finally, it must be noted that many issues and controversies beyond those mentioned here remain to be settled. B. The Limits of General Advocacy and the Growing Im portance of Specific Chemical Proceedings As the agencies complete their initial general rulemaking implementation of their statutes, they turn to case by case, chemical by chemical application of the rules. To the extent that chemical industry advocacy has been successful, the gen eral rules are usually neutral or non-specific with regard to industry interests. In this situation often agencies will seek to establish by precedent what they could not win in the general rulemaking in specific chemical cases. As noted in Section II, a wave of specific chemical cases is on the way, and it is clear that the precedents set in these cases will finally set the terms of chemical industry regulation. Indeed, we have already seen in the Benzene case the importance a specific chemical case can assume for the entire industry. C. The Need for Communication, Coordination and Cooper ation in Specific Chemical Cases Chemical industry advocacy will be much more difficult in the context of specific chemical proceedings. There may be very many proceedings. The proceedings will directly affect speci fic marketing and commercial interests of only a few companies. It will be easy to lose track of the overall strategy and approach developed by CMA through the EMC, CRAC and the OSH Committee. The agencies may achieve their ultimate victory, not on merit, but by successful application of a divide and conquer theory. In the face of this challenge, the chemical industry must organize to ensure that there is communication and cooperation between the standing CMA committees and any special programs or groups operating in their area. Further, to the maximum extent possible, a general strategy should be made available for use by special programs and general coordination should be ensured. D. The Special Programs Advisory Group (SPAG) Will Provide for Communication and Coordination and Its Charter and Guidelines Should be Approve# ,The first CMA specific chemical advocacy program was the Benzene Panel which was approved by the Board in 1977. Com- 1 -2- CMA 037659 munications and coordination here was assured by the close staff support and by overlapping membership on the Benzene Panel, CRAC and OSH Committees. CMA staff realized that a'more formalized communication and coordination mechanism would be required if there were to be any significant increase in specific chemical advocacy programs. At a conference at Belmont, Maryland in July 1979, the concept of SPAG was developed by a group of industry representatives and CMA staff. The concept of SPAG is that representatives of standing CMA committees and special program representatives should be brought together to form a multidisciplined group which can ensure the necessary communication and coordination for spe cial programs. Another important function of SPAG is to set standards and provide oversight for special programs activi ties. The Executive Committee approved the creation of SPAG on an interim basis in September 1979. During the past year SPAG has been formed and has started to review advocacy programs. The most important activity has been the development of guide lines which will provide the basis for SPAG approval and supervision of special programs. Executive Committee approval of these guidelines, attached as Appendix A, is requested at this time. In addition, SPAG has been expanded to make its composi tion more like that of a standing committee and to reflect the increasing importance of specific' chemical proceedings. The expanded SPAG Membership List is presented in Appendix B for Executive Committee approval. The high quality of the SPAG membership will give CMA an excellent basis to advise new advocacy programs. It should also give SPAG an ability to assist the chemical industry in pro viding communication and coordination for specific advocacy programs which are formed outside of CMA. 3 CMA 037660 II. DESCRIPTION OF SPECIFIC CHEMICAL CASES WHICH WILL ESTAB LISH PRECEDENTS FOR REGULATION OF THE "CHEMICAL INDUSTRY The major laws of interest to CMA which will present precedent-setting specific chemical cases are: o Toxic Substances Control Act - EPA o Resource Conservation and Recovery Act - EPA o Clean Air Act - EPA o Clean Water Act - EPA o Occupational Safety and Health Act - OSHA The discussion in this report is limited to regulatory areas which will impact specific chemicals and thus may require services from CMA's Special Programs Division rather than standing committees. Specific chemical cases also will arise under FIFRA, The Food, Drug and Cosmetic Act, and The Consumer Product Safety Act, but these will not be dealt with here. A. Toxic Substances Control Act (TSCA) Under Section 4 of TSCA, an Interagency Testing Committee (ITC) was established to recommend a list of priority chemicals which the Administrator of EPA should consider for promulgation of testing rules. The ITC must give priority attention to those chemicals known or suggested to cause cancer, gene mutations, or birth defects. No more than 50 substances or mixtures may be on the list at any one time. Under Section 26 of TSCA, the agency has interpreted chemical substances to include categories. This will result in far more than 50 chemicals on this list. The chemicals which ITC already has recommended for testing are listed in Table 1. Once EPA has received the ITC recommendations, it has one year either to initiate action by requiring testing by rule for each substance or to publish its reasons for not doing so. No final testing rule has yet been issued; however, EPA has proposed testing rules on two of the ITC recommended substances and decided not to require any additional testing on one other. A specific schedule for the promulgating testing rule is shown -4- CMA 037661 in Table 2. In his revised affidavit in September 1980, Mr. Steven Jellinek of EPA said that he plans to complete his testing decisions on chemicals listed in Table 1 over a fouryear period, rather than the se?en years which he had proposed in his earlier affidavit in March 1980. The reduction in time necessary to make the decision will be achieved by replacing Advanced Notice of Proposed Rule (ANPR) with more informal contact and discussion with industry. ANPRs would be reserved largely for the more complex issues raised by chemical cate gories. As these testing rules will be chemical specific, and especially as EPA is seeking informal contact and discussion with industry, both research and advocacy activities within the Special Programs Division related to Section 4 testing rules are anticipated to increase considerably. There is a clear potential for damage to specific segments of industry if development of testing rules are not closely followed. In addition to developing health and environmental ef fects testing rules, EPA is now attempting to develop proposed rules that will limit or ban production and distribution of many chemicals in the United States. If, under pressure from various environmental groups, EPA starts developing many such rules and does not have adequate scientific information, demand for advocacy programs within the Special Programs Division will increase. The chlorofluorocarbon production ceiling is one of the first such actions under Section 6. Precedent-setting specific chemical cases can also be expected under Section 5 (e) . B. Resource Conservation and Recovery Act (RCRA) Under this law EPA currently is establishing an ambitious new regulatory framework. This will include specified controls on the disposal of virtually any form of solid waste. Imple mentation of RCRA by EPA will place upon industry an extensive and administratively burdensome regulation. By the end of this year, EPA will have listed nearly 600 hazardous wastes. This list will include wastes from the production of various chlor inated hydrocarbons, phosphates, titanium dioxide, paints, chlorobenzenes, nitrobenzenes and aniline, just to name a few. The CMA Special Programs Division may be called upon to undertake single product or product group advocacy as a result of these regulations. -5- CMA 037662 c. Clean Air Act (CAA) Table 3 lists industrial categories for which EPA plans to develop new source performance standards (NSPS's). EPA will propose a NSPS on non-metallic mineral processing within the next 60 days and is currently evaluating polymers and resins'for proposing a NSPS in the near future. The CMA Special Programs Division has already received a request from the Allied Chem ical Corporation to initiate a special program on non-metallic mineral processing. Standards of performance for new stationary sources are established under Section 111 of the CAA. This Section directs the Administrator to establish standards of performance for any category of new stationary sources of air pollution which " . . . causes or contributes significantly to air pollution which may reasonably be anticipated to endanger public health or welfare." It will cost the chemical industry $100 million if it does not participate in the development of reasonable standards through appropriate economic and scientific advocacy programs. Where the pollutants being emitted are potentially toxic or carcinogenic, regulation is effected under Section 112 of the CAA by establishing National Emission Standards for Hazardous Air Pollutants (NESHAP), rather than the us of _ Section 111. The most emphasis to date on establishing NESHAPs has been on the control of emission of benzene from various sources. These include maleic anhydride plants, ethyl ben zene/styrene plants, benzene storage, and fugitive emissions. By mid-1981 EPA plans to add nine chemicals to the Section 112 list. These are: arsenic, coke oven emissions, cadmium, acrylonitrile, perchloroethylene, tri-chloroethylene, methyl chloroform, methylene chloride and toluene. For some of these chemicals EPA does not have an adequate scientific basis to designate them under Section 112. In addition, all listings published by EPA so far contain 33 other chemicals for con sideration to be regulated under Section 112. D. Clean Water Act (CWA) The major area in which the CMA Special Programs Division may be asked to provide services is the clean water quality criteria and standards. EPA is currently finalizing water quality criteria for protection of aquatic life and human health for the 65 Consent Decree priority pollutants. These criteria may form the bases of state water quality standards. -6 - CMA 037663 A partial list of 65 chemicals designated as priority pollu tants is shown in Rafale 4. E. Occupational Safety and Health Act (OSH Act) OSHA has recently published a list of substances which are " candidates for further scientific review and possible id ra tification, classification, and regulation as potential oc cupational carcinogens. Chemicals on this list are shown in Table 5. This list does not include chemicals on EPA's Cancer Assessment Group listing. Chemicals identified by CAG as having substantial evidence of carcinogenicity are listed in Table 6. Since 1970, OSHA has initiated rulemaking proceedings on asbestos, vinyl chloride, coke oven emissions, arsenic, benzene, acrylonitrile, and beryllium in addition to the ori ginal 14 carcinogens. The CMA Executive Committee in 1977 approved an advocacy program for benzene in response to an unjustified workerexposure standard proposed by OSHA. The CMA Benzene Program Panel successfully supported the American Petroleum Institute in rebutting that standard. As OSHA initiates additional rulemaking procedures on specific chemicals, the need for services from CMA's Special Programs Division may also in crease. F. National Toxicology Program (NTP) - A Non-Regulatory Activity within the Department of Health and Human Resources Having Significant Impact on The Chemical Industry The Government agencies participating in the NTP program are: FDA, NCI, NIEHS, and NIOSH. The major task of NTP is to identify those chemicals that must be controlled to prevent disease. The program, proposed in the 1980 Annual Plan of NTP, called for testing about 600 chemicals with an operating budget of $68.8 million. An alphabetical index of chemicals cited in the annual plan is shown in Table 7. It is in the interest of companies producing and processing these chemicals to form special programs under CMA to continuously follow the research conducted by NTP and to generate their own data if they do not agree to the conduct of research being performed by the Govern ment. Even though EPA and OSHA are not currently participating in NTP, data generated from this program will be used by both of these agencies to regulate the production and processing of chemicals designated "toxic" by NTP. - 7- CMA 037664 III. DIVISION OF BIOMEDICAL AND ENVIRONMENTAL SPECIAL PROGRAMS A. Division Overview and History The Division of Biomedical and Environmental Special Programs (Special Programs) provides manufacturers, proces sors, and/or users of a chemical or chemicals with the op portunity to support collectively research and/or advocacy programs on specific chemicals. This division was known formerly as Special Projects. The Chemical Manufacturers Association (CMA) approved the first "special project" in 1972. The intent at that time was for CMA to collect and disburse the necessary funds, contract for the research to be done, and provide meeting facilities and surveillance over the conduct of the meetings. The time requirements on CMA staff were expected to be minimal since the participating companies would, provide all technical expertise and management skills necessary to conduct the programs. The administration of these programs was assigned to CMA secretaries of several standing committees. The number of special programs administered by CMA in creased at a moderate rate from 1972 to 1979. By the end of 1979, CMA was administering 17 special programs. In 19S0, requests for CMA to undertake new special programs suddenly increased tremendously'. This increase was due mainly to increased activities related to the Toxic Substances Control Act, Clean Air Act and Clean Water Act. Within the past nine months, CMA received five requests to undertake new programs and two inquiries as to how to initiate a new special program. The Special Programs Division presently coordinates research and advocacy activities for twenty special programs. t CMA took its first steps toward advocacy in 1977 when the Benzene Program Panel was formed in response to a workerexposure standard proposed by OSHA. Industry believed that the scientific studies on which this standard was based were flawed. The Benzene Panel's Charter was to develop a sound technical base that could be used by the industry to challenge the proposed regulations. The Benzene Panel's Charter was expanded in November 1978, to allow the Panel to represent the interests of the members of CMA before Federal and state agencies in all matters relating to safety and health issues arising out of the production, reaction, release, packaging, repackaging, storage, transportation, handling or use of ben zene. Until 1980, no other program panel had been chartered for advocacy. In September 1979, the CMA Executive Committee authorized the formation of a Special Projects Advisory Group (SPAG). Appendix A lists membership proposed for approval by the CMA Executive Committee at its October 27, 1980 meeting. Along with | f ii i \ -8- i i CMA 037666 CMA staff, SPAG revised the existing Special Programs Guide lines and developed new guidelines for advocacy programs. The revised Guidelines and SPAG's Charter are included as Appendix B of this report. Among its other duties, SPAG reviews requests for individual product advocacy by special program panels and determines whether appropriate conditions for these advocacy positions have been met. During 1980, SPAG recommended ap proval of a limited advocacy charter for the fluorocarbon program and a research charter for the ketone program. SPAG also reviewed plans for a rubber additives research program and a non-metallic minerals industry advocacy program. B. Staff Organization and Responsibilities The Special Programs Division has a staff of ten including a Director, four program administrators, a program coordina tor, and four secretaries. One program administrator and one secretary devote their time exclusively to the Fluorocarbon Program. The other three program administrators and three secretaries are responsible for the remaining nineteen (19) programs. Figure 1 outlines the organization of Special Programs with respect to both the staff and the specific programs. Program administrators prepare for and attend panel and task group meetings, prepare records of meetings, and contract for and administer all contracts in their respective areas. In addition, when appropriate, program administrators: o communicate with government agencies on scientific and regulatory matters; o coordinate information flow to and from the agen cies, the companies, other trade associations and academic communities; and, o coordinate the development of advocacy and regula tory position papers with appropriate CMA staff, standing committees, and outside consultants. Professional development of both program administrators and secretaries is encouraged within their respective areas of operation. Ways through which Special Programs and CMA can operate more effectively are discussed at regular staff meet ings. -9- CMA 037666 The Special Programs Division keeps the office of General Counsel informed of>the status of ongoing panel activities. A lawyer spends one-half of his time on special programs. C. Orientation of Panel Members At the orientation meeting for company representatives interested in a new special program, the acting program admin istrator distributes the Special Programs Guidelines. The Director of Special Programs emphasizes the major concepts covered by these Guidelines, and explains the importance of understanding them fully. The Director also explains, in detail, SPAG's function. Each panel's program, according to the revised Guide lines, will be reviewed annually by SPAG. Along with the review of ongoing research and/or advocacy programs, SPAG will, at this time, offer advice on how the panel may better integrate its work with the rest of CMA. This integration and co ordination is made easier because SPAG membership includes representatives from CMA's Chemical Regulations Advisory Com mittee (CRAC), Environmental Management Committee (EMC), and Occupational Safety and Health Committee (OSHC). In addition to periodic reviews of the panel, SPAG will review and update the Special Programs Guidelines on an annual basis. During the annual review, comments and criticism received on the Guide lines from panel members will be taken into consideration. New members who join an ongoing program are given the Special Programs Guidelines and the program Charter and recent minutes of that Program. With the acceptance of the new Special Programs Guide lines, it will be necessary to restructure any panel which is now set up for research only and later wishes to pursue advocacy. CMA staff will work closely with SPAG and the panel to implement this restructuring as smoothly as possible. D. Panel/Staff Interface Program Administrators are now playing a much more visible role in the operation of panels. They are guiding panels through interpretation of the new Guidelines and are working closely with panel and contractors in not only following the I r I - 10 - CMA 037667 research which is being performed, but making sure that the research is conforming to the agreements written by CMA. The Staff of Special Programs is consulting with other divisions of the CMA Technical Department for a more efficient approach to mutual problems. E. Budget Management To date CMA has spent $1,294,197 to administer research and advocacy commitments which total $14,413,655 (see Table $) . CMA administration budget: From 1972 to 1974 CMA did not charge special programs for the service it provided because during that time such services did not have a significant impact on CMA's budget. In 1974, when staff time required to admin ister special programs began to increase, CMA began to charge the programs based on the time spent by the program administra tor plus other direct expenses. This reimbursement was de signed to eliminate the use of membership dues for the payment of special programs. The programs currently are charged at a rate of $500/day, based upon time spent by the program administrator. This charge includes the direct and allocated costs of the full time professional and secretarial staff assigned to the Special Programs Division but does not include routine professional or support assistance from other Divisions of the Technical De partment or from the Legal, Government Relations, Communica tions, and Administrative Services Departments. Other direct costs, such as out-of-town travel, meeting room and program equipment rentals when meetings are outside of CMA, conference calls, telex, unusually large printing and mailings, etc., are charged to the program as miscellaneous administrative ex penses. Other CMA professional time, if required to work on specific or nonroutine aspects of the program, is charged at the same rate as the program administrator. Interest received by CMA on non-disbursed Special Program funds is credited to CMA general funds to defray administrative costs not recovered by the daily established rate. The fluoro carbon program, however, is an exception to this rule. Starting June 1, 1980, the fluorocarbon program has been charged $16,000 per month (equivalent to $800/day) to cover all administrative expenses. The program simultaneously is credited with 0.66% interest on the previous month's balance. The results of this experiment will be evaluated at the end of the current fiscal year. 11 - CMA 037668 Research/advocacy budget; CMA requires written commit ment for the full amount of the study budget from all partici pating companies before executing study contracts. A separate account is established to recei-ve and disburse funds for each program, including additions and extensions subsequently au thorized. Routinely, participating companies are invoiced at approximately 50% of their projected fiscal year commitments. Additional collections are made as necessary to maintain a reserve from which disbursements are made. The reserves are maintained as low as possible under financially sound manage ment. A financial statement for each program, detailing both the research/advocacy and administrative information, is prepared on a monthly basis. Review of these statements by the Director and the Program Administrators insures that each program is working within its authorized budget. A copy of this financial statement is provided to respective panel members at their meetings to keep them informed of the financial status of the panel. P. Future Needs If CMA is requested to expand the Special Programs Divi sion to meet the increased need of the chemical industry, the need for additional resources will not be limited to the Special Programs Division, but also will involve the Legal and Admin istrative Departments. The future needs can be broken down into the following categories: Program administrators/secretaries: Past experience has shown that the optimum number of programs a program admin istrator can handle efficiently is five, and that sharing a secretary among program administrators reduces efficiency. Thus, whenever a new program administrator is hired, a secre tary should also be hired. The total number of programs that can be administered efficiently by CMA will depend upon the structure of the Special Programs Division. With planned growth over a period of several years, CMA easily can administer up to 50 projects. However, such growth should only occur with proper coordination betw n the Technical, Legal and Administrative Departments. Legal department: The extent of help necessary from the Legal Department will depend mainly upon the types of n w programs administered by CMA. If CMA receives many requests for advocacy programs, the impact on the Legal Department will be considerable. - 12 CMA 037669 Accounting: The greatest impact of Special Programs' expansion will be on the Accounting Division. The Admin istrative Services Department should be consulted in evalua ting this impact. Word processing and reproduction capabilities! A dedicated word processing unit will become essential if the number of special programs administered by CMA exceeds 30. Partially dedicated reproduction and mailroom facilities will be essen tial if the number of programs administered by CMA exceeds 35. - Office space: As CMA expands the Special Programs Divi sion, additional office space for new program administrators and secretaries will be needed based upon the extent of expan sion. The expansion of the Special Programs Division may require the addition of personnel in the Legal and Admin istrative Services Departments, and should be taken into con sideration when analyzing the office space issue. Liability insurance; An outside expert or a brokerage firm should be consulted to provide CMA with guidance in this area. The information obtained should be factored into the decision process for expansion. G. Conclusions Within the past nine months, CMA received five requests to undertake new programs and two inquiries as to how to initiate a new special program. CMA can anticipate receiving many more inquires for special programs as a result of increased regula tory activities within various government agencies. After considerable revision of both the Special Programs Guidelines and the standard research agreement, and the estab lishment of the Special Programs Advisory Group, CMA is now capable'of fulfilling its new role as a more effective admin istrator of both research and advocacy programs. Compared to any other organization within the United States, CMA, at present, possesses the best capability to provide special program services and should expand its capabilities to serve the chemical industry at a higher level. As additional work is requested, staff requirements and additional needs will be identified along with their costs to maintain the Special Programs Division's self-funding status. - 13 - CMA 037670 Table 1. -- The TSCA Section 4(e) Priority List 1. Acetonitrile 2. Acrylamide 3. Alkyl epoxides 4. Alkyl phthalates 5. Aniline and bromo, chloro and/or nitro Anilines 6. Antimony (metal) 7. Antimony sulfide 8. Antimony trioxide 9. Aryl phosphates 10. Benzidine-based dyes 11. Chlorinated benzenes, mono- and di12. Chlorinated benzenes, tri-, tetra-, and penta13. Chlorinated naphthalenes 14. Chlorinated paraffins 15. Chloromethane 16. Cresols 17. o-Dianisidine-based dyes 18. Dichloromethane 19. 1,2-Dichloropropane 20. Cyclohexanone 21. Glycidol and its derivatives 22. Halogenated alkyl epoxides 23. Hexachloro-1,3-butadiene 24. Hexachlorocyclopentadiene 25. Hydroquinone 26. Isophorone 27. Mesityl oxide. 28. 4,4-Methylenedianiline 29. Methyl ethyl ketone 30. Methyl isobutyl ketone 31. Nitrobenzene 32. Phenylenediamines 3J. Polychlorinated terphenyls 34. Pyridine 35. Quinone 36. o-Tolidine-based dyes 37. Toluene 38. 1,1,1-Trichloroethane 39. Xylene - 14 CMA 037671 Table 2. -- Schedule for EPA's Action on Chemicals Listed in Table 1. Pte So. of jingle Chemicals or Cateooglae Action 5/81 3 Proposed miss and/or dseisions not to test 1941 a Proposed nils* and/or dseisions not to tsst 1942 13 Proposed tsst miss and/or dseisions not to tsst 1943 13 Proposed mis* and/or decisions not to tsst - 15 - Chemicals ITC Lists lilii nitrobenzene; Diehloromathane; l 1# 1-Triehloroethane 1" 2 2 Eight of the following chemicals! Acetonitrile Alkyl Phthalatss Antimony Antimony Trioxids Antimony Sulfide Aryl Phosphates Benzidine Oyes Chlotoparaffins Chloronaphthalenss Cresols Oianisidins Dyes Bsxachlorobutadisne Nsthylsnsdianilins o-Tolidins oyes Phsnylsnediamines Polychlorinated Tsrpbsnyls 4 1 4 4 4 2 5 1 2 1 5 1 4 5 6 2 (1) The sight remaining chemicals in the 1941 list (2) PIts of the following chsmicalsi Alkyl Epoxides 1 Acrylamide (Snwiron- 2 mental) Anilines 4 Chlorobenzenes l (Environmental) Cyclohexanone 4 1, 2-Diehloro- 3 propane Haloalkyl Epoxides ' 2 Pyridine 2 Toluene xylenes 1 1 3 (1) The S remaining cheaieals cm the 1942 list (2) Tbs following sight chemicals* Glyeidel Group lexaehlorocyele- psntadisns lydroguirons Iaophsrone Mesityl Oxids Methyl Ethyl Estone Methyl Isobutyl Esteem Quinonm CMA 037672 Table 3 INDUSTRIAL CATEGORIES FOR. NEW SOURCE PERFOIWANCE STANDARDS ARE TO BE EEVELCPED* STAIKUAKI FUEL OOfflUSTICN - BASIC CHEMICAL MNUFACIUIC 14. Stationary internal conbustion 1. Synthetic Organic Chemical Mfg aiginas 61. Borax and boric acid JEIMIJURGICAL PROCESSES 47. Hydrofluoric acid 10. By-product coke ovens 65. Phosphoric acid: Thermal process 23. Fcundrlee: Grey iron 40. Potash 41. Foundries: Steel 46. Sodlun carbonate 42. Secondary alimimm CHEMICAL PRODUCTS MANUFACTURE 20. Secondary copper 52. Amronia 66. Secondary zinc 2. Carbon black 67. Uraniun refining 31. Charcoal MINERAL PRODUCTS 71. Detergent 57. Asphalt roofing 17. Explosives 49. Brick aid related clay products 7. Fuel conversion 60. Castable refractories 34. Printing ink 58. Ceranic clay 35. Synthetic fibers 48. Fiberglass 28. Synthetic rubber 38. Glass 29. Varnish* 45. Gypsun EVAPORATIVE TOSS SOURCES 19. Metallic mineral processing 6. Dry cleaning 13. Mineral wool 9. Graphic arts 15. Non-metallic mineral processing 15. Industrial surface coating: Autos 64. Perlits 3. Industrial surface costing: Cans 21. Fhosphsts rock preparation 8. Industrial surface coating: Fabric 43. Sintering: Clay and flyash 37. Industrial surface coating: Large POLB0S AID RESINS appliances 54. ABS-SAN realne 32. Industrial surface coating: Metal 12. Acrylic resins 50. Phmolic resins colls 5. Industrial surface coating: Paper 62. Polyester resins PETROLEUM INDUSTRY 30. Polyethylene 25. Crude oil & natural gas producticn 55. Polypropylene 53. Polystyrene 72. HmhHm additives 4. Petroleum refinery: Ebgitive sources 51. Urea-melanlne resins 33. Transportation and marketing FOOD AID AGRICULTURAL 68. Alfalfa dehydrating WOOD PROCESSING 24. ood pulping: Acid sulfite 44. Amzroium sulfate 22. Chemical wood pulping: Neutral 59. Anirniraa nitrate fertilizer sulfite (N5SQ 69. Animal feed defluorination 36. Plywood, nanufacture 63. Starch 006130. PRODUCTS 70. Urea (for fertilizer & polymers) 56. Textile processing 27. Vegetable oil MINOR SOURCE CATEGORIES WASTE HDTNERAHON Lead --<d battery mscufacture 11. Incineration: inAratrial-iXimercial Solvent metal cleaning (degreasing) Industrial coating: furo. * This list ma issued raider $311 of the Clean Air Act by EPA on August 31. 1978 (43 Fad. Rag. 38872-77). The ranters were assigned by EPA to reflect priorities, the lowest ranters Indicating highest priority. - 16 - CMA 037673 I I Table 4.-- A Partial List of 65 Chemicals Designated as Priority Pollutants Arsenic Benzene Beryllium Cadmium Carbon tetrachloride Chlordane Chlorinated naphthalenes Chloroform 2-chlorophenol Dichlorobenzenes 2,4-Dimethylphenol 2,3,7,8-Tetrachlorodibenzo-p-dioxin Fluoranthene Heptachlor Hexachlotobutadiene Hexachlorocyclopentadiene Lead Nitrosamines Pentachlorophenol Selenium Silver Tetrachlocoethylene Thallium Trichloroethylene vinyl Chloride J - 17 - CMA 037674 Table 5 Occupational Safety and Health Administration * lUt of SubttintM Mhlc* Hor It C<nd1d<ti for furthor Scientific Htvlow Jr*' laialli >1*1 Sr*l 4-4c*<rl4B<--1*--I *ctic *14, Sw Mtl C*t4M--tl4M, J'--l-- i-mim 4 o>mhmmihim SMmmi cmm--imm, M$MU> Imtwmniia tw MIUMMMlvlBlIla MIKiW, .K^<MM1^-{.MM4M|. >-W--- -M-0<MUyl4.<(M4Ufl-->*)--1 MIIIm Mr--tarIM *-- IWMalM --WtM MKw, >ro l<%U;l>HltMtWMaM 4 4`--tyt4--U(M^--ttyl. Jx NlttW`1 hN t>arftt*i*m, 4w.1'^alrwTlM. talllat. 4,4*-tIMI. *r* .*-i4*i--i*--rj Min* MMIm, t,4,lMfMl> t| 1.4.4-lrMftl--MHIM W4*441<mM, l1--,4.1*Htyf>tM--Mfl1M|MHMrtiMwi,HIiw MUM*, IntllfM >!* 1MI< MU--JmM M>ltJir--Mi<--M,,*-m<-- >M >MMl-- pttM ' SfU 1mm 1 CMA 037675 uUtti (Isl) Sxt /,44lMlwwlMl Wlf*U ImMlM 4lll)*<tklTt4r Srw (l.l'-llylmytM.IMtwIw iMltaliHnlt, 4.ttra> Syw 4-4Urv.*4WlW44Ml !mi WIHw IwpilC <4. 4y4ril44 Sr": Iwwyl "v<k-ul4( Imkmmm, l*`.4<i(4iaaUrlwlK Syw Hirtltr** Ktn* Mwnwiww 4lw<a* Syw Qwlww 4lwlw y"*.ti**i.nia Syw Ol4C4tylM>(t4lM UU*y4rachlwt#* lyw I.J'^HmImMhiWIm Ulr|k|4rMl*l* tolyrlc 14, ?-MiaU-{ttJlylUl*)., XSyx Ok tUUatlK* totyrlc ttii, {laM*(MlflUI|*, U Syw t*l4l4# Cyr**l <4, ylH-yywyHW|4lW,wUwh> tilt J<"i Wml 6v*4Pil4, S*4j MyMmMyiTMnlt 6.1. tnMIrn wwtt 11 h"l hlylllyt, kelv>, ly*OW> 6.1. QlWCt 1k* M, yitMfea Wit tru t.Mwn4yl44iM4iiWiyM yeH. Malawi. "1*1 IMMIn Wit 6.1. Ilntt 11*4 1, (l>lW1n uK SfM l.MWltWIimylllilfnM H. 1. >((,<* Utrtullm Mil 6.1. #lr*rt trw< to Swy Cflwar, (S.(('.((x, S MWWyryl- ((I^iiii^tfa4iyw|}<n| Mytl)uil(l,l'4MynylM) Wl Mil e.i. Mim him i, hmmim* S*4: knllK kf^twilwy, IHi> 6.1. Hum tow** 11 Um Mviwlwt 1*--It l.aytwl* 6.1, S1i in* Vnm | lw HkMylmMMMItot 6.1. toM tollt t , tow Miliat, Hiwitol Cl. totowt ftll 1 SlV 6.1. totfWt T*11w J4 Iwt will**, 4,4Misi4M*twy|]tt< ((.MtacWyi* Cytltoi*i*. liM.I.l.toMictlmi Syw |MM InMIarM SlythylMlw, M'-dldilar* 4 wUiyl.. 4yMre)r14i tyw mcilantliMiM hwradilarlto a-O'****-4-*!. 1.4-4laytkyl., iuIM Syw bitMUoui UlMiylHlMi toltnn. lyw Mltrw4.nrl4lHw giyMmyladw, Mltrat*. l|*i 0ly4wylattrMlw tthaaa. U4I| (<4ilrwt1wi). S/m ftoyltw ylycal *U (chlwwwtkyl) attar lyw tnt turn, l,MM1m>l44U(HU)ilflNyl)< Ijh .#'^Uyl^OO ttftaaal, t-Mrulw. Syw MtwNyWwytttytMrufto CtW. f.l.'Httlwwtoayl fwltWMayl lyw t.<mtUra.l.(toUmrnwwy)XMw Ctaylyaa, tow*. Syaj flayl twalto Cttylwt. MWtW!*l,ZWI*(MMrVMrt)4 lyw Hwraa 4---. 1,4.Mrlitw lyw ' ` ' .........-- M Hyirw 1 aa> ttwrma, Mltr*. lyw M1Ih4M1mmi Martl4**r*, toltn., TTilrMliiini SyM lllMfWH44l ***. UMtaytHyl., 414y#4to1w1to lyw MwttomylXyWUlW 414yWWlarlii Wy**1w. Wtkyl. lyw miwlw *a*1w Mtkyto. wlfW(l*t) tyw. MVU*4>W4mmI1Mi wywuiw. wMytoiy tyw %4rulw 4yWi> Hfluk Itowto, will WrtMM lyw MwyltyHmlw 4ywtlwl* - 19 - 4M**1*, (Itl) tw MniN <ir^w H)ru <. Mtuwni mhiU, itmtnum tilt CaltCTM IrUjtn*)- Jmj 94C4*tMl' (twhtlMlmlt'll*, Smi >T*treiirmftUMimitril4 l,l,4<a*tM*Mttt-<ycJmt*(c4ll*'*MJ*im. Jm* mm Sm* RwH'ivImlaa aatur* >r*irnu 1*14 Jmi Pxtcttu <*14 SH C.I. 1UH -mmwImmimim, 4^*iv. *M 4~Cklar*MMM>l>4llm mHMftmMMiit, l**t*i Smi l4iltmU-lM>MNllal JwMMUylm'twMiMmlliitMt 4iim*r*mlMl* mMmMiaim, (*nm Jm C.I. IW9 Smt*i <\4.4.firtl*MM*H*lMr 4Muw Umr Nuimrw M, tPMMMI wt*r S*i mtml mwnm Smi MM trimurn, xiiiiW ttaallmfe *14, Sm* *ltlPM IlNrul*, I.MMlmto Jmi i-rouiimmiHmlM Mi Hwmml 4il*i4*t mmr * nn, Mllm Jm IwltmmM NrlUm, JmmMMm<ii|miili'Ulim'<iM4Mll4i Mmlim Jm* l IIMMmirn* Qalmltm, U1M Jm imm SjmMUcrnlHMl*fHt*Mto Jm* iMmcalMim SMumlMCruMMRimiM1lam* ml 41fM*1>mM*, it\SMI 4l#M*l4t4 1mm Tiram* Mlmtarimu WeiMc *eii. mm Jm >MtM Jfcml'MJUiiMrMl*.nVw.lnfml*MUt-VIUUttWI). M4ric *14. *l*ml iUr Jm (4**i TIV*1<m, MWHi(1lfliWlWwrtMlll Jm (Mil uihrm JTmrtMflcJf, MIVlwM MimK ('mimWifm Jm (4mi *WfrMlm1 UMlMMIrl# Jm NurmtiM NMMhrM T>lMmt,MMm iM mt*lmm4laam -TihMlm Jm IMMmMiMmm mhMlim, 1MI> Jm M*iw JiWIh I i*mMmt mTtMMi, !**#, iWM, llMMrlflmm l,-41*ttr*4l,JM1mMW JM HtflMlM Mil, MM Jm I 4 mMaMMIw M, J-t-OI*mm<ilM,I HMMMl M, Jm* i.r4i*wii<timm M, t,l,J,JMMin|M4Mm Jm W* ( M, l,J.Vtr1*MtMI-tM4> iMI 4.4,rTrlMU|IUl<M*M * 20- "fWlMi 44 MTttlm 4 MUM CMA 037677 Table 6. -- Chemicals Having Substantial Evidence Carcinogenicity; CAG List 2<ActtyUminofluora*' Acrylonitrile (CAG, IARC) Allatoxins (IARC) ' Aldnn (CAG. NCI) 4-Aminbbipheoyl (IARC) Amitrole (IARC) Aramita (IARC) Arsenic and Arsenic Compounds (CAG. IARC) Asbestos iCaG. LaRC) Auramine and the manufacture of Auraimne (IARC) Araserme (IARC) ` Benzieiacndine (IARC) ` Benzta>anthracene (LARC).' Benzene (CAG. IARC) Benzidine (CAG, IARC) Benzo(a)pyrene (IARC) Benzotbifluoranthane (LARC) Benzolj)fluoranthene (IARC) 1 Beryllium and Beryllium Compounds (CAG, IARC) N,N-BU( 2-Chlorothyl )-2-Napbthylamine (Odomapbanae) (IARC) * Cadmium and Cadmium Compounds (CAG, IARC) Carbon Tetrachloride (CAG, IARC) 1.2-Dimethyihydraxine (IARC) Dimethyl Sulfate (TARC) 3.4-Dinitrotoluene (CAG Nd) 1.4-Dioxane (NCI) 1.2-DiphenyUiydrazine (CAG) Epichlorohydrin (CAG) ; Ethylenebisdithiocarbamate (EBDC) (CAG) Ethyieneimine (Azindine) (IaRC) * Ethylene Oxide (CAG, IARC) Ethylenethiourea (CAG. IARC) Ethyl MethanesulfonaU (IARC) Formaldehyde (CAG) Glycidaldehyde (IaRC) Hepuchlor (CAG, Nd) Hexaehlorobenzene (CAG, IARC) Hexachlorobutadiane (CAG) Chlorambucil (IARC) * Hexachlorocyciohexane (HCH) . ChloroaUcyi Ether: HCH (CAG) Bis( 2-chloroethyl)ethar (BCEE) (CAG) (IARC)1 HCH (Undane) (CAG) Bislchlorometfiyl lather (BCME) (CAG, IARC) Technical HCH (CAG) Chloromethyl methyl ether (CMME), technical grade Hydrazine (IARC) (IARC) Indcno<l,2.3^d)pyrene 'IARC) Chlordane (CAG, Nd) Iron Dextran (IARC) Chlorinated Ethanes Isosafroie (IARC) 1.2-Dichloroethane [Ethylene Chloride. Dichloride (EDC)I (CAG, IARC, NCI) Hexacbloroethene (CAG) 1.1.2.2-Ttrachioroethane (CAG) l.U-Trichloroethane (CAG, NCI, LARC) * Chlorobenzilate (CAG) Chloroform (CAG, IARC) Ethylene Kepone (Chlordecone) (CAG, Nd) Lasiocarpuie (IARC, Nd) Melphalan (IARC) * Mcthapyrilene (FDA) * 3-Methyicholanthrene' 4.4'-Methylenebis(2-Chioroaniline) (MOCA) (IARC) Methyl Iodide (CAG. IARC) Methyl Methanesulfanate (IARC) Chromium Compounds, Hcxavalent (CAG, IARC) N-Methyi-N'-mtro-N*oitrasofuiaidine (IARC) Chrysene (IARC) * Methylthiouracil (IARC) ` Citrus Rad No 2 fURf) Mitomycin C (IARC) * Coal Tar and Soot (CAG included is LARCs soots, tan. and oils designation) Mustard Gas (IARC) l*Naphthylamina, technical grade (CAG) Coke oven Emissions (Polycyclic Organic Matter <POM)) (CAG) Creosote (CAG) 2-Naphthylamine (IARC) Nickel and Nickti Compounds (CAG, IARC) Nitrogen Mustard and its hydrochloride (IARC) Cycasin (IARC) Nitrogen Mustard N-oxide and its hydrochloride (IARC) Cyclophosphamide (IARC)4 3>Nitm'toluidiM (Nd) Daunomycia (IARC) * 4-NitmquiaoUne>l'0nida1 DDT (Dichlorodiphenyitrichloroethane) (CAG) Nitroeamines Diallata (CAG) (IARC) * N-Nltroaodiethanolamina (IARC) Dib*nz(a,h)acridine (IARC) N-.Vitrosodlethyiamine (DENA) (CAG, IARC) Dibenz(a.j)acridiiM (IARO N'Nitrosodimetfaylamina (DMNA) (CAG, IARC) Dibenzia.hianthracene (IARC) N-Nitro*odi*thhutylamina (IARC) 7H-Dibenzo<c.g)carba*oie (IARC) N'Nitrosodi^hpropylainine (IARC) 7H>Dibemo4c.gIcazhaole (IARC) N>Nitrosomethyiethylamine (IARC) Dibenzo(a.*)pynM (IARC) N*(Sitrunxnethylvinylamine (IARC) Dibenzo(a^lpyrMW (IARO N-NitroeO'N-Ethyliirea (NEU) (CAG. IARC) Dibanxo(a.i)pyroe (IARO 1.2- Dibromo-3-chIocopropane (DBCP) (CAG, IARC NO) 1.2- Dtbroraoethane f Ethylene Bromide, Ethylene N-Nitroso*N-Methyiurea (NMU), (CAG. LARC) N-Nltroso-N-methylurethane (IARC) N-Nltroaomcrpboline (IARC) Dibromide (EDB)I (NO, CAG, IARO Xr-Dichlorohenzidine (DCS) (CAG, IARO Dieldrin (CAG) Diepoxybutane (IARC) N-Nltrosooornicotiae (IARC) N-Nltrosopipertdine (IARO N-NItraopyrroUdine (IARC) N-Nitrososarcosine (IARC) 1.2- Diethylhydrasine (IARO Diethylsulbestrol (DES) (IARC) Dihydrosafroie (IARC) 3,3*-Dimethoxyhmzidine (o*Diaaitidlae) (IARC) p-Dimethylaminoazobenzane (IARC) 7.12-Dlmethylbenx< a tanthracene 3.3*-Dimethylbenxidine (o-Tolidine) (IARC) Dimethyicarbamoyi Chloride (IARC) 1.1-DfmethylhydnuBM (IARO Pentachlnrooitrobenzane (PCNB) (CAG) Phenacetin (IARC) Polychlorinated Biphenyls (PCBs) (CAG, IARC) Prunamide (CAG) 1.2-Propane Sultom (IARC) . -Propiolactom (IARC) Propylthiouracil (IARO' Reserpine (Nd) ` Saccharin (FDA) ` 21 - CMA 037678 Safrol* (CAG. IARC) * Selenium Sulfide (NCI) Streptoiotocin (IARC) * 2,3.7.8-Tetrachlorodibenio-p-dioxin (TCDD) (CAG) TetracWoroetbylene (Perchloroethylene) (CAG, NCI) Thioaceumide (IARC)- Thiourea (IARC) o-Toluidine Hydrochloride (NCI) Toxaphene (CAG, IARC, NCI) Trichloroethylene (CAG. NCI) 2,4,6-Trichlorophenol (NCI) ____ Trisi l-azindinyl (phosphine sulfide (ThioTEPA) (IARC, NCI) * Tris( 2,3-dibromopropyl(phosphate (IARC, NCI) Trypan Blue, commercial grade (IARC) Uracil Mustard (IARC) Urethane (IARC) (Ethyl carbamate; ethyl ester of earbamic acid) Vinyl Chloride (CAG, IARC) Vinyiidcne Chloride (CAG) 1 This is not a comprehensive list of all chemicals having substan tial evidence of carcinogenicity. Other chemicals will be added. No attempt has been made to select chemicals based upon ap propriateness for regulation by EPA. The list is intended to be a .basis for selection by the venous program offices according to their specific oeeds. 1 Well known carcinogen tar which so report has hem prepend by CAG or IARC. 1 Fungal toxin, not an industrially manufactured product ' Used as a drug. 1 Evaluated by IARC as not having sufficient evidence of car cinogenicity. * used as a fbood. - 22 CMA 037679 Table 7. -- Alphabetical index of Chemicals Cited in the NTP Annual Plan Acetamide 25 Acetin 25 Acetohexamide 36 2-Acetyl aminof1uorene 4-Acetyl aminof1uorene N-Acetylaminof1uorene 40 40 40 Acetyl-o-toluldine 25 Acetylsalicyclic acid 36 Acid black 42 Acid orange #3 42 Acid red 25 68 Acrolein 25 Acrylamide 70 Agar agar 42, 55 Agaritlne 42 Aldicarb 36, 5, 62 Ally! chloride 51 Allyl Isothiocyanate 42 Ally! isovalerate 42 2- Aminoanthraqulnone 36. 51 3- Am1no-9-ethylcarbazole hydrochloride 3-Am1no-a,a,a-tr1fluorotoluene 25 1-Amino-2-methylanthraquinone 51 2- Am1no-4-n1trophenol 42 2-Amino-5-nltrophenol ' 42 - 23 - 51 CMA 037680 To reduce bulk Pages 24 - 45 are not included. They will be provided upon request. CMA 037681 Tris (2,3-dlbromo propyl) phosphate 67 Trls (1,3-dlchlorolsopyl) phosphate 67 Trls(2-ethyl hexyl)phosphate 32, 50 Trls(Isopropylphenyl)phosphate 34 . o-Trltolyl phosphate 32 p-Tritolyl phosphate 32 t-Tryptophan 38 Urethane 40 Vitamin A 74 Vinyl chloride 65 Vinylcyclohexane 50 Vlnylcyclohexene dioxide 61 Vlnylldene chloride 1, 27, 50, 56, 60 Vinyl toluene 50 Violet 3 50 Wollastonlte calcium silicates 34, 59 Mitch hazel 50 m-Xylene 32, 73 o-Xylene 32, 73 p-Xylene 32, 73 Xylenes, mixed 59, 72, 73 Xylenesulfonlc acid, sodium salt 50, 61 2,6-Xylldlne 61 Yellow #14 50, 56 Zearalenone 50 Zlram 50, 56 46 - CMA 037682 I A. B. DeAngalo,Pb.D. Prograw Mrinlitratot T A. Noyd, B.A. Meratary --Allyl Chi rida lutylated Hydroxytuluoim Reaina "Glycol Ethers "Mon-Metallic Ninarala "Phthelata Esters Tinylidene Chloride ]G. V. COX, Ptl.D. Vice President and Technical Director 1 H. C. Shah, Ph.D. Director D. J. BoltastD.S. Project Coordinator 1 J. T. Seawall,B.S. 1 Proqran Adninistrator 1 M. Da Marco, B.A. Secretary "Acrylonitrile --Ethylene Dlbroad.de --Phoegene Safety "Titaniim Dioxide '"Trichloroethylene C. R. Stack, Ph.D. I Prooram Adninistrator 1 L. Walton Secretary 1 J. C. Van Horn,H.S. 1 Proqran Adninistrator | b. *. Bilal 1 Secretary | --Bensene --Chlorobensenes " Rubber Additives ""Styrene "Vinyl Chloride Sine Dlalkyl Dlthlophosphates L"Tluorocartoona i FIGURE 1. Organisation of Biomdical and Environmntal Soeclal Program t CMA 10/8/BO CMA TABLE 8 BIOMEDICAL AND ENVIRONMENTAL SPECIAL PROGRAMS BUDGET* PROGRAM RESEARCH AND ADVOCACY CCMMITMENT AEMINISTRATIVE EXPEtEES TOTAL Acrylonitrile $ 728,484 $ 59,411 $ 787,895 Allyl Chloride 210,600 13,948 224,548 Benzene 1,430,444 83,526 1,513,970 Butylated Hydroxytoluene 21,944 25,213 47,157 Chlorobenzenes 300,972 . 22,334 323,306 Epichlorohydrin 214,882 27,332 242,214 Epoxy Resins --0-- 9,368 9,368 Ethylene Dihromide 10,000 28,836 38,836 Ethylene Dichloride Glycol Ethers 288,100 59,376 -0- 347,479 -0- Ketones -0- 10,901 -10,901 Phosgene 207,912 55,035 262,947 Fhthalate Esters 106,471 72,086 178,357 Rubber Additives 27,900 5,867 33,767 Styrene 708,218 54,934 763,152 Titanium Dioxide 30,725 14,615 45,340 Trichloroethylene Vinyl Chloride 490,506 1,326,562 77,152 112,958 567,658 1,439,520 Vinylidene Chloride 729,482 52,088 781,570 Zinc DiaDcyl Dithiophosphates -0- -0- Subtotal 6,833,202 784,983 7,618,185 Fluorocarbons 7f580f453 509,214 8,089,667 TOTAL $14,413,655 $1,294,197 $15,707,852 fluorocarbons program from start thru May 30, 1980. All other program start to September, 1980. bAPI is ao-sponaoring a portion of this research. Its share ($1,587,786) Is not shown in this figure. The figure dses include $303,388 paid to outside legal counsel not shown on the program stannary in Appendix A. - 48 - CMA 037684 9/22/80 APPENDIX A BIOMEDICAL AND ENVIRONMENTAL SPECIAL PROGRAMS GUIDELINES October 14, 1980 CMA 037686 TABLE OF CONTENTS 1.0 OBJECTIVE . 2.0 PROCEDURE FOR ESTABLISHING A NEW RESEARCH AND/OR ADVOCACY PROGRAM 2.1 Program Development 2.2 Program Approval by CMA 2.3 Program Acceptance by Companies 2.4 Additional Participation 3.0 ADMINISTRATION OF SPECIAL PROGRAMS 3.1 Program Panel 3.2 Task Groups 3.3 Financial 3.4 Inactive Program 3.5 Termination of a Program 4.0 INFORMATION HANDLING 5.0 BIOMEDICAL AND ENVIRONMENTAL SPECIAL PROGRAMS ADVISORY GROUP CHARTER 5.1 Purpose 5.2 Organization 5.3 Membership 5.4 Reviews 6.0 PURPOSE AND OBJECTIVES OF THE ASSOCIATION 7.0 ANTITRUST GUIDE FOR CMA COMMITTEE MEMBERS Figure <5-1. Procedure for Approving and Conducting Research and/or Advocacy Programs for a Chemical or a Group of Chemicals Page A-l A-2 A-2 A-3 A-4 A-5 A-6 A-6 A-8 A-8 A-10 A-10 A--11 A-13 A-13 A-13 A-14 A-15 A-17 A-13 A-16 X.O OBJECTIVE The objective of the Biomedical and Environmental Special Programs Division,- hereafter referred to as Special Programs, is to provide manufacturers, processors, and/or users of a chemical or chemicals with the opportunity to support collectively research and/or advocacy* on specific chemicals. It is the intent of the Chemical Manufacturers Association(CMA) to serve participating companies by providing proper and effective administration. It is anticipated that scientific information developed through research programs will promote the health and safety of the general public and of workers involved in manufacturing and processing of these chemicals. All significant findings of CMA-administered research programs will be disclosed to the public in a timely manner. *When referring to Special Programs, advocacy in volves external communication (not designed solely for information exchange) that relates to existing or de veloping regulations, legislation or litigation. CMA 037687 2.0 PROCEDURE FOR ESTABLISHING A NEW RESEARCH AND/OR ADVOCACY PROGRAM 2.1 Program Development CMA will undertake only those programs that are consistent with the purpose and objectives of the Association as approved by the Board of Directors (See Section 6.0). CMA's procedure for development of a research and/or advocacy program is included in Figure G-l and described below: (a) A member company must request, in writing, that CMA explore the possibility of admin istering a new research and/or advocacy program. (b) Initially, CMA will inform U.S. manufacturers of the subject chemical (s) and all Canadian member companies of the request received and will evaluate their interest in participating in the program. Consideration will also be given to other potentially interested parties. (c) If two or more manufacturers, including at least one CMA member company, are interested in participating in the program, CMA will hold a meeting for company representatives to discuss the feasibility of establishing the program under CMA's administration. Those attending should be prepared to discuss: (i) specific program needs and proposals; (ii) estimated costs; (iii) basis of funding; (The estimated cost may be equally shared among all com panies or may be pro-rated based on their production and/or use volum , sales volume, or other method agreed upon by the panel and CMA.) (iv) extent of participation by processors, users, other trade associations, and/or foreign companies; and (v) voting procedure. Each special program panel will prepare written voting A-2 CMA 037688 procedures before funding commitments ar made. These voting procedures will govern decision-making by the panel. At a minimum, the procedures must define a quorum and prescribe the number of votes needed to render a decision of the panel. Each panel will have only one voting representative per participating company. Other nonvoting members may be invited by the panel. Provisions to permit balloting by mail or by proxy may be included. (d) Representatives of interested companies will draft a charter and formulate a description of the proposed program. The charter must clearly describe the purpose and scope of the program. Model charters will be available from the program administrator. (e) Each company intending to participate in the program will appoint a representative. These representatives will form a program panel. If a program involves advocacy, its panel should include individuals with legal, reg ulatory, business and scientific expertise. If a'program involves research only, its panel must consist of members with experience in scientific and regulatory areas. (f) CMA will record time spent on program admin istration during the development phase of a program. All accumulated charges will be transferred to the program if it is approved by CMA. 2.2 Program Approval by CMA CMA's procedure for approval of a special program will be as follows: (a) The Director of Special Programs and Office of General Counsel will evaluate the proposal for the availability of CMA resources and the program's consistency with CMA policies and procedures. (b) A panel representative will present the draft charter of the proposed program to the Bio medical and Environmental Special Programs Advisory Group (SPAG) for its recommendation for approval* SPAG's charter is described in Section 5.0 of these Guidelines. A-3 CMA 037689 (c) After careful review of the draft charter and projected availability of both professional and financial resources from participating companies, SPAG will notify the Director of Special Programs, -and through him the Office of General Counsel and President, of its recommendation as to approval or disapproval of the program and the charter. (d) Based upon SPAG's recommendation the CMA Board of Directors will approve the program and commit CMA resources. The Board of Directors may delegate this authority to th Executive Committee or the President. 2.3 Program Acceptance by Companies CMA will distribute the draft charter, a descrip tion of the planned activities and a proposed budget to companies which may have an interest in participation. A form for accepting the basis of funding and pledging support of the proposed program will accompany the pro posal. Unpublished business information such as pro duction capacity and sales volume, when obtained to determine pro-rata share, will be held confidential. The Sponsoring companies, before committing them selves to participating in the program, must agree to: (a) conduct the program according to CMA general policies and procedures as described in these guidelines and according to the "Antitrust Guide for CMA Committee Members," (See Sec tion 7.0); (b) conduct the program with the full partici pation and guidance of CMA's Office of Gen eral Counsel and disclose to this Office all potential conflicts of interest; (c) arrange for employment of outside counsel, if required, through CMA; (d) accept CMA administration and disbursement of program funds at the panel's direction; (e) provide a program panel representative who is qualified and assigned to devote the time necessary to fulfill the panel responsibil ities as outlined in these guidelines; (f) follow CMA clearance procedure for release of information about and from the program. This commitment shall not preclude individuals or A-4 > i , CMA 037690 corporations from releasing information without CMA clearance where the law imposes the responsibility upon an individual or corporation; * (g) make validated research results, whether interim or final, available to the public. Access to raw data underlying studies in the public domain (including tissues, slides and the like) will be made available upon the receipt of reasonable requests which show the need for such data. Requests which will involve additional costs to be incurred by the participating companies and possible reimbursement due to such companies (e.g. under TSCA and FIFRA) will be reviewed by the panel in advance of any commitment to release the raw data; (h) disclose to CMA and other participants any private agreement(s) on the subject chemical(s) under consideration for the proposed work; (i) pursue long-range objectives of the program. For advocacy programs this may include litigation; (j) conduct the proposed program in accordance with the approved charter. Each panel member will be responsible for obtaining approval from his/her company of proposed changes in the scope of the charter. The panel must then request approval for such changes from SPAG and CMA; and, (k) restructure a panel which was structured for research and which later wishes to pursue advocacy. In such a case, the panel must also develop a new charter. 2.4 Additional Participation The proposal for a new program may be distributed to other trade associations or companies, if there appears to be a common scientific and business inter est. Initial contacts with other associations will be coordinated with CMA's Director of Association Liaison. Opportunities will be provided for additional participants to join the panel with appropriate allocations of expenses. A-5 CMA 037691 3.0 ADMINISTRATION OF SPECIAL PROGRAMS 3.1 Program Panel The Director of Special Programs will appoint a program administrator as the CMA representative on the Program Panel. The chairman and vice chairman of the panel will be elected by panel members. A critical factor in the successful conduct of a special research and advocacy program is the selection of chairmen with leadership abilities, technical competence and a commitment from his/her management for the time necessary to do the required job. No individual will be chairman of more than one panel without written commitment from the company. Each panel will elect or reelect the panel chairman and vice chairman annually. All panel and task group meetings must be called and attended by the CMA staff representative. All CMA program-related meetings with regulatory agencies or contractors must be arranged in coordination with CMA. Each panel representative will supply CMA with the name of his/her management contact. The management contact is the official of a participating company who has the authority to commit both professional and financial resources of the company to support the program. A panel representative can be a management contact also. CMA must be informed in writing when there is a change in the management contact or the panel representative. The panel has the ultimate responsibility for planning the research program, preparing and approving protocols, identifying potential contractors, directing the research, and reviewing technical publications. The panel will instruct the program administrator regarding the selection of contractors, proposed expenditure of funds and any modifications or extensions of planned protocols within the charter of the approved program and within the budget approved by the management contacts. To ensure scientific integrity, the panel members will decide on the appropriateness of third-party monitoring and/or in-depth technical auditing for every study. It is the individual panel member's responsibility to report to CMA's program administrator any contacts he/she has with study contractors regarding the panel's project. CMA has the obligation to oppose for just cause the hiring or utilization of any contractor. Any A-6 CMA 037692 disagreement will be referred to SPAG for its recom mendations. At the request of the panel* the program administrator will prepare and the CMA treasurer will execute agreements with approved organizations. The panel may request modification of any agreement, in cluding changes in the protocol; however, execution of these changes will be the responsibility of CMA. As a general guideline, CMA recommends that the initial funding for each study include an appropriate contingency fund. At the conclusion of any research project, the program panel may reallocate any unex pended funds to other approved panel activities. CMA's program responsibilities will include the collection, disbursement, and accounting of all funds related to the program, providing secretarial and technical services to coordinate and administer the program, and providing advice on policy matters relat ing to the conduct of research or advocacy programs. Program administrators will prepare for and attend panel and task group meetings, prepare records of meetings, and administer all contracts in their respective areas. In addition, the CMA program administrator will, when appropriate: (1) establish close working relationships with government agencies; (2) coordinate information flow to and from the agencies, the companies, other trade associations, and academic communities; and (3) coordinate the development of advocacy and regulatory position papers with appropriate CMA staff and outside consultants. In order to facilitate legal assistance to the panel, CMA's Office of General Counsel will be kept informed of the status of ongoing panel activities. The panel member will have the responsibility for all communications on program matters to interested parties within his/her own company. CMA will direct all technical and financial communications with participating companies to the panel members. The panel members are responsible for obtaining financial and personnel commitments from their companies. If in CMA's opinion, undue delays are attributable to lack of commitment on the part of the company or its representative, CMA may communicate directly with the management contact to alleviate the situation. Meetings will be held in Washington, D.C., unless otherwise approved by the Director of Special Programs. When a meeting is held outside of Washington, D.C, all expenses for that meeting, including those incurred by the program administrator and by panel authorized A-7 CMA 037693 guests, will be charged as administrative expenses to the panel. Panel members will always be individually responsible for their personal expenses. The panel may underwrite expenses incurred by one or more of its members in performing a preauthorized task. Each panel chairman, in conjunction with the pro gram administrator, will prepare an annual report for presentation to SPAG. 3.2 Task Groups Panels may organize task groups to perform speci fic functions. The panel chairman will appoint the members and chairman of the task group. Each task group must have a charter approved by the full panel and CMA. Task group chairmen will report to the panel at th discretion of the panel chairman. There will be a full panel review of task group activities and membership at least once a year. This review will establish the necessity for the continuation of the task group and whether the task group is acting within its approved charter. Any task group which has fulfilled its responsibilities under the established charter must be disbanded. 3.3 Financial 3.3.1 CMA administration CMA will charge participating companies the full costs, including overhead, for administering special programs. The program account will be charged at th established per diem for professional staff. The cur rent charge is 5500/day. This charge includes the di rect and allocated costs of the full time professional and clerical staff assigned to the Special Programs Division but does not include routine professional or support assistance from other Divisions of the Tech nical Department or from the Legal, Government Rela tions, Communications, and Administrative Services Departments. Other direct costs, such as out-of-town travel, meeting room and program equipment rentals when meeting outside CMA, conference calls, telex, unusually larg printing and mailings, etc*, will be charged as miscellaneous administrative expenses to the program. A-8 CMA 037694 Other CMA professional staff time, if required to work on specific or non-routine aspects of the program, will be charged at the same rate as the program administra tor. Interest received by CMA on non-disbursed Special Program funds will be credited to the CMA general fund to defray administrative costs not recovered by the daily established rate. 3.3.2 Panel research/advocacy budget CMA will require written commitment for the full amount of a study budget from all participating com panies before executing study contract(s). A separate account will be established to receive and disburse funds for each program. As a matter of CMA fiscal policy, participating companies will be invoiced for a minimum of 50% of the projected fiscal year commitments. Initial invoicing will occur immediately after participating company management approval of the program activities. During the course of the program, additional collections will be made as necessary to maintain a reserve from which disbursements are made. Reserve shall be maintained as low as possible under financially sound management. A new phase of a program will begin whenever there is a change in composition of sponsoring companies. At the completion of any phase of a program, uncommitted funds will be carried over to a subsequent phase. If a company voluntarily drops out of a program at the completion of all contracted work, a refund will be made if the pro-rated balance of uncommitted funds exceeds $2,500 for that company. A company which voluntarily drops out of a program during an ongoing study will be expected to provide its full financial commitment to the current study phase including any additions or extensions which were approved during the term of its participation. A financial statement for each program, detailing both research/advocacy and administrative information, will be prepared periodically. A copy of the statement will be provided to panel members at their meetings to keep them informed of the financial status of the panel. It is not possible to anticipate each and every element of financial exposure. However, it should be recognized as a matter of principle that the member companies represented on the panel will accept respon sibility for any costs resulting from activities of the panel (e.g., litigation expenses). ' A-9 CMA 037695 3.4 Inactiv Program Any panel which has no ongoing research or advo cacy program for two consecutive months will be con sidered inactive. Each inactive program panel will be charged a retainer fee equivalent to two days of ad ministrative charges per month beginning with the third month. 3.5 Termination of a Program The Board of Directors reserves the right to terminate any on-going program for just cause. At the time of termination of an on-going program, the Board will establish the procedure for termination. A program panel that votes to disband will be ter minated. A panel with no outstanding studies for twelve consecutive months will be terminated upon SPAG recommendation. A program cannot be terminated until all applicable charges have been paid. Upon termination of a program, no refunds will be made to participating companies unless the refund of unusad funds to any one participant equals or exceeds $2,500. In such a case, a refund will be made to all participants of the last phase of the program in direct proportion to the contribution they made at the begin ning of the last phase.* * To be rewritten to provide that ail panels will be subject to an annual review by SPAG and approval of Executive Com mittee. A-10 CMA 037696 4.0 INFORMATION HANDLING CMA, as a matter of policy, makes validated final results of research administered by it available to the public, including appropriate government agencies. In terim reports with significant findings, after proper validation, will be made available also. The significance of the findings in interim re ports will be determined by the panel in conjunction with the program administrator. Any disagreement will be brought to the attention of the CMA Technical Di rector and General Counsel through the Director of Special Programs. Any matter unresolved at these lev els may be brought to the Executive Committee and the Board through the President without going through SPAG. The decision of the Board will be final and binding to the panel and CMA staff. It must be recognized that CMA may be obligated under Section 8(d) of the Toxic Substances Control Act to report pertinent information to EPA, but is not obligated to report under Section 8(e). Section 8(e) determinations are the responsi bility of each individual or company, upon whom the statutory obligations rest. A contractor's scientific conclusions and pro fessional judgments will not be subject to CMA or panel approval. However, CMA and the panel will have the right to review such judgments and conclusions prior to their finalization for the purpose of suggesting clarifications, and format and editing comments, but not for the purpose of substituting CMA's opinion or that of the panel for the contractor's. CMA is obli gated to supply such comments, if any, within 30 days of the receipt of the draft final report. If the pro gram panel does not agree with the discussion and con clusions of the final report, it may include a rebuttal along with the final report before such report is re leased to the public. Prior to final payment to a contractor, the panel must accept, through ballot if necessary, any final report and other services which were to be provided as fulfilling all contractual obligations. If a panel member does not return the ballot on the report within 30 days, the vote will be recorded as favoring accept ance. Data generated by a contractor under CMA sponsor ship are the property of CMA as agent for the panel. CMA will not take physical possession of the raw data for any research projects that it administers, but will contract for the storage of such data, if necessary. A-ll CMA 037697 Non-participating companies and the general public wishing to purchase a final report may do so at cost of reproduction, handling and mailing. CMA staff will use its discretion in providing free copies of such re ports. CMA encourages publication of the panels' research in peer review scientific journals. Manuscripts pre pared by the contractor or panel or task group member for oral presentation or publication in scientific journals will be submitted to the program panel with adequate time for review prior to presentation or sub mission to a journal. Published reports should ac knowledge CMA sponsorship and may include attribution to the contractor and individual contributors. A-12 CMA 037698 5.0 BIOMEDICAL AND ENVIRONMENTAL SPECIAL PROGRAMS ADVISORY GROUP CHARTER 5.1 PURPOSE The Biomedical and Environmental Special Programs Advisory Group, hereafter referred to as SPAG, was authorized by the CMA Executive Committee in September, 1979. SPAG serves CMA's Biomedical and Environmental Special Programs Division, hereafter referred to as Special Programs, in an advisory capacity to ensure that all special programs are conducted in a manner consistent with CMA general policy and with the Special Programs Guidelines. SPAG must recommend approval of the charter of any proposed special program before it can be considered for operation by CMA. Any subsequent request for amendments to a charter must be reviewed by SPAG before CMA approval. SPAG will review and make recomendation on all advocacy* programs on individual chemical(s) requested by a program panel. With both research and advocacy programs, SPAG will determine that appropriate conditions and criteria are met and that the necessary resources are com mitted. When appropriate, and at the request of the program panel or CMA staff, SPAG will provide general oversight and counsel on policy issues. An ancillary function of SPAG is to provide CMA staff and special program panels with any new regu latory information that becomes available to them* 5.2 ORGANIZATION CMA standing committee chairmen will approve appointment of their committee representatives to SPAG. The Director of Special Programs will be the CMA representative to SPAG. CMA's General Counsel, Technical Director, and a representative from the Chemical Industry Institute of Toxicology, will be nonvoting ex officio members. Standing committee ^When referring to Special Programs, advocacy in volves external communication not designed solely for information exchange that relates to existing or de veloping regulations, legislation or litigation. A-13 CMA 037699 representatives on SPAG should coordinate activities of Special Programs with their respective standing committees* The maximum term of the -Chairman and individual SPAG members will be three years. Representatives of CMA standing committees will be appointed annually by their committee chairman in consultation with CMA staff. One-third of the SPAG membership will be ro tated annually. At the end of his/her term, the Chairman of SPAG will become a nonvoting ex officio member for one year. Membership in SPAG will be terminated if a member does not attend at least twothirds of the total number of meetings during any twelve-month period. A quorum will consist of a majority of SPAG members having full voting privileges. Each SPAG member has one vote and a decision shall be rendered by a majority vote of the total membership. In the event of a tie vote the Chairman's decision will be final. Voting by written proxy will be allowed. * 5.3 MEMBERSHIP SPAG will consist of 15 members, including the Chairman. The Chairman of SPAG will be appointed by the CMA President and the appointment will be confirmed by the CMA Executive Committee. Members of SPAG will be appointed by the President and will include at least one member from each of the following CMA committees: o Chemical Regulations Advisory Committee 0 Occupational Safety and Health Committee o Environmental Management Committee Other members will be selected based on expertise in one or more of the following: 0 Special Program Operations 0 Business Management 0 Regulatory Agencies Activities 0 Specific Scientific Disciplines 0 Law A-14 * To be rewritten to provide that the members and chairmen will be recommended by the President and appointed by the Executive Com mittee. CMA 037700 f 5.4 REVIEWS SPAG will review and prepare recommendations, if necessary, to revise Special Programs Guidelines to reflect changing requirements and new regulations at least once a year. The procedure for approving and conducting both research and advocacy programs is outlined in Figure G-l. SPAG will, at a minimum, review each special program once a year. This review will concentrate on scientific and/or policy issues, adequacy of profes sional and financial support from participating com panies, availability of CMA resources, and a yearend report on the program's status. During these re views, SPAG will act in an advisory, rather than a supervisory or management, capacity. A special program panel, or any panel member, may request review of scientific and policy issues by SPAG and seek its advice and guidance. SPAG may hold special meetings to review any issue of grave con cern. All reviews will be coordinated with the Pro gram Administrator, Director of Special Programs and the Special Program Panel Chairman. - When SPAG makes a recommendation, it must be 1 followed within such time as is designated by SPAG unless a reconsideration of the recommendation by SPAG has been requested by the panel within that period of time. If the program panel disagrees with SPAG's recommendations, the panel may petition CMA's Executive Committee or Board of Directors through the President. SPAG's charter, activities, and operation will be submitted for review by the Executive Committee by 1 May 31, 1981 and annually thereafter. 1 s i (1 ! 1 ! j A-15 1 i CMA 037701 Member Company Recommende Program i CMA Evaluates Other Companies' Interest A -------- Interested Companies Meet to Define Scope, Draft Charter, and Project Budget A Panel Presents Charter to SPAG and SPAG Prepares Recommendations i -------------CMA President Approves Program, Pending Receipt of Program Commitment 1 ----------- Participating Companies' Managements Submit Program Commitments 1 CMA Approves Research Program -- Task Groups are Formed and Protocols Prepared .. 1 Panel Selects Contractor i Panel and CMA Monitor Contractor's Work y Panel Accepts and CMA Releases Final Report .................. ""I...... . ' --------- Additional Work Done if Necessary j-- -J SPAG Periodically Reviews Research Programs :I Panel Develops Detailed Advocacy Program l ________ SPAG Makes Recommendations on Advocacy Program A- CMA Approves Advocacy Program 1 Panel Implements Advocacy Program 1 CMA Staff Clears Ail Advocacy Communications ______ _______ SPAG Periodically Reviews Advocacy Programs FIGURE G-l A-16 Procedure for Development and Operation of Research and/or Advocacy Programs for a Chemical or a Group of Chemicals. CMA 037702 APPENDIX B BIOMEDICAL AMD ENVIRONMENTAL SPECIAL PROGRAMS ADVISORY GROUP (SPAGI PURPOSE: SPAG will serve the Biomedical and Environmental Special Programs Division in an advisory capacity to ensure that all special programs are conducted in a manner consistent with CMA general policy and with Special Programs Guidelines. SPAG will review and make recommendations on all advocacy programs on individual chcmicalis) requested by a program panel. Frank A. Bower, Ph.D. Jackson B. Browning Edward M. Callahan Fred C. Dehn, Ph.D. Richard J. Kociba, D.V.M., Ph.D. TERM ENDING HAY 31, 1981 E. I. du Pont de Nemours i Company, Chestnut Run, Wilmington, PE 19898 Union Carbide Corporation, 270 Park Avenue, New York, NY 10017 Allied Chemical Company, Columbia Rd. t Park Avenue, Morristown, NJ 07960 PPG Industries, Inc., One Gateway Center, Pittsburgh, PA 15222 The Dow Chemical Company, 1801 Dow Center, Midland, MI 48640 td KI* H. Donald Feeney G. J. Levlnskas, Ph.D. Curtis W. Smith, Ph.D. Otto Sturzenegger, Ph.D. Car 1 Uml and TERM ENDING HAY 31, 1982 ( Borg-Warner Chemical Corp., International Center, Parkersburgh, WV 26181 Monsanto Company, 880 North Lindbergh BTvd., St. Louis, MO 63166 Shell Chemical Company, P. O. Box 2463, Houston, TX 77001 C1BA-CE1GY Corporation, Ardsley, NV 10582 Exxon Chemical Coaq>any U.S.A., P. O. Box 3272, Houston, TX 77001 William C. Becker Calvin Bennlng, Ph.D. Conrad Kent, Esquire Myrl E. Miller, Ph.D. Gary Ter Haar, Ph.D. TERM ENDING HAY 31, 1983 The BFGoodrich Company, 6100 Oak Tree Blvd., Cleveland, Oil 44111 Essex Chemical Corporation, 146) Broad Street, Clifton, NJ 07015 Stauffer Chemical Company, Westport, CN 06880 IMC Chemical Group, 421 East Hawley Street, Mundelein, IL 60060 Ethyl Corporation, 451 Florida Avenue, Baton Rouge, LA 70801 t CMA 037703 Exhibit E OSHA/EPA LABELING PROPOSALS STATUS CMA ALTERNATIVE POSITION BACKGROUND Previous briefings on the nature of hazards communica tion regulatory activities by OSHA and EPA are still accur ate. However, very recent developments have seen the EPA proposal stalled virtually on the eve of publication in the Federal Register. This has happened as a result of apparent agreement between Steve Jellinek and Eula Bingham that fur ther discussion between the two agencies would be required to resolve the fundamentally different approaches taken by each to date.^/ This development represents a serious situation if OSHA's specification approach were to dominate. Accord ingly, CMA's strategy has been modified to gain participation in the resolution process. A joint meeting with Jellinek and Bingham has been successfully negotiated and is scheduled for November 6. Preparation for these discussions has necessitated an accelerated development of CMA alternative positions as guidelines for the OSHA regulatory process. A draft sub stantive outline which embodies a number of basic principles has the general support of the Hazards Communications Special Committee. The single area of substantive concern requiring further resolution is that of trade secret protection with regard to substance/mixture identification to customer em ployees. The HCSC feels confident that a position broadly acceptable to the CMA membership can be developed which will accord the protection desired. RECOMMENDED POSITION The fundamental principles proposed for Executive Com mittee endorsement as guidance to HCSC in its continuous de velopment of alternative positions and discussions with the agencies on the subject of hazards communications are as follows: 1. Any hazards communication program must provide read ily comprehensible and effective protective information about known hazards associated with chemicals used by employees in their work areas. VEPA developed performance standards with a nongeneric treatment of chronic hazards limited to carcinogenicity; OSHA has consistently moved towards specification standards using a generic approach to chronic hazards which included many other poorly understood health effects beyond carcinogenicity such as reproductive hazard, behavioral modification, etc. CMA 037704 ! 2. Such programs must incorporate an education and training element as a minimum along with other appropriate communication devices such as labels, material safety data sheets, placards, etc. 3. Chemical identity of materials in the work area willbe provided to employees or their physicians. Proprietary identities will be protected by adequate confidentiality agreements. Downstream identification of proprietary infor mation for customers' employees beyond common name will be made only for purposes of medical treatment by consultation between physicians on a confidential basis; all other hazard protection information short of specific chemical identity will be appropriately conveyed without other restriction. Note: (If a mixture contains a regulated carcinogen at or above established cut-off levels, the identity of that carcinogen will be fully disclosed re gardless of trade secret claims. 4. Performance standards are the only practical way to retain sound existing company programs, but the need for an enforceable program is recognized and can be provided by workplace hazards commmunication plans subject to inspection (not approval in advance). 5. Acute hazards will be handled generically in accord ance with ANSI criteria. 6. All other hazards should be substance specific and determined by regulation to constitute a significant risk. In general, this realistically applies primarily to carcino gens at the present time but, with improvements in the state of scientific understanding, could include reproductive tox ins, behavioral modifications, etc. Obviously, if an employ er knows of recognized hazards beyond those established by regulation, he must communicate this information. 7. There is no rational basis for determining acute hazards of mixtures other than by assessing the properties of the mixture taken as a whole either by evaluation of avail able information or by testing. 3. There is no rational basis for different regulation of chemical mixtures which pose hazards on the basis of in tentional addition or natural presence of constituent sub stances. 9. All procedures and positions adopted previously by CMA which are consistent with AIHC with respect to the iden tification and handling of chronic hazards will be main tained. 2 CMA 037705 j 10. Any effort to require inclusion of epidemiology study base information is beyond the scope of a hazard communication proposal. ACTION REQUIRED HCSC requests endorsement of the above principles for use in alternative guidelines and discussions with the agencies. CMA EC - 10/27/80 BD - 10/28/80 3 CMA 037706 Exhibit F Remarks of Mr. Krumrei CMA Board of Directors October 28, 1980 The background statement on the paper in front of you gives the very recent developments through last week Wednesday. I believe that the meeting with Mr. Jellinek and Dr. Bingham on November 6 should be helpful for these reasons: Jellinek, at least, is completely in agreement with us, that the two agencies need to coordinate and to try to get comity on the regulations. He has been extremely helpful in setting up this meeting and we are hopeful that this will result in a much more cost-effective OSHA standard. It obviously delays the publication of any standard until after the election and therefore removes the intense political pressure under which the agencies have been operating. We are frankly surprised that they would be willing to delay the publication of these documents but nonetheless they have. In a meeting last Thursday with Dr. Bailus Walker who heads up this area with OSHA, and with some of his people, we are very pleased to learn that some of our earlier arguments have been heard and that they are apparently moving from the design or specification standard approach to the performance approach in at least one area i.e., the labeling of pipes, pumps, vessels, etc. Although they would not give us a copy of the revised proposal, they allowed us to see that portion of it, and it indicates that most of the labeling requirements have been removed and therefore the major por tion of the cost for the OSHA proposal will be eliminated if the new version stands. In addition. Dr. Walker listened very attentively to our primary concerns about the present OSHA proposal. These are, that it is a design or specification standard instead of a performance standard, that it does not adequately provide for trade secret handling, and that it does not adequately separate acute and chronic hazards in that they are both treated generically. In that meeting and in the meeting in the afternoon with additional members of his staff, we think we made some progress in these areas as well. His final request to us was that we provide him with an alternative to their proposal couched in regulatory language, since they are still "open-minded." He actually CMA 037707 - 2- indicated he would like to have as many as three or four al ternatives, but, we will be lucky to get one finished. This then is the reason why I am asking your agreement to allowus to use the principles that are in front of you in the development of our alternative. I am fully aware of the difficulty of writing regulatory language for a trade association as diverse and as large as ours. I am not happy with that prospect, but I am convinced at this point that the only way we can attain anything near what we need, is to do just that. I assure you that we will very carefully review our alternative with Mr. Roland and Mr. Frost, and if the three of us conclude that the area is sufficiently sensitive, we will ask for concurrence of the Executive Committee before we give it to OSHA. Dr. Walker said that he was not anxious to have a proposal that was so far off base that they would be embarrassed or where it would lead to litigation. He further indicated that he is anxious to get our alterna tive and that he will give a "reasonable" time, without spe cifying the length of time. He made it very clear, however, that he is still under time pressure, and that he does not want rhetoric nor should we use this as a mechanism for further stalling or delaying the standard. We told him that we would act as expeditiously as we can considering that it is a complex standard and that we had a large number of companies involved. As a matter of fact when I indicated to him we would pledge our continued cooperation to develop a proposal and to pro vide in a public hearing a full explanation of our problems, along with the necessary experts to answer questions, he asked whether we would also pledge to not bring suit in the Fifth Circuit Court. My response was that I would pledge that we would not do so, as long as he would pledge to accept all of our changes. Other areas that I would like to bring to your attention are the following; First, we are proceeding to develop a procedure which will be amended at determining the relative economic impacts of the OSHA and EPA proposals and our alternatives, we have identified some contract organizations and will be placing such a contract as soon as we have a better picture of what the proposals are actually likely to be. If we can continue to be successful in getting changes made before the proposal is published, this may obviate the need for a major expendi ture in this area. CMA 037708 3 We are also developing a proposed argument on trade secrets along with as much data as we can obtain to present to the_ OSHA counsel in a meeting on November 5. Mr. Roland has mailed to all Executive Contacts a letter requesting the type of information we need. I would like to urge your im mediate attention to this with your company contacts so that we can get as much information prior to that meeting as we can possibly assemble. In addition, our Confidentiality Task Group has developed a proposed confidential disclosure agreement which we will be discussing with the CMA membership in the future. Another area that I mentioned last time, is the activity at the state level. We have been very pleased to have the Soap and Detergent Association take immediate action on our re quest to ask their representatives in the various states to provide information in this area at the state and local level. They not only have put out the request but several state representatives have already submitted reports. I believe that this will operate as an interim procedure but would urge that th*is committee address the state problem at some time in the future to be able to handle other things as they arise. CMA EC-9/27/80 BD-9/28/80 CMA 037709 SUPERFUND: STATUS, OUTLOOK AND CMA PROGRAM Exhibit G Congress recessed October 2 for the November elections leaving considerable legislative business unfinished, including Superfund. A "lame duck" session begins November 12, and al though budget matters are considered the main reason Congress will return, we much anticipate that the proponents of Superfund will push hard for enactment of a law this year. In late September the House of Representatives passed two Superfund bills by wide margins: H.R.85 and H.R.7020. The focus now moves to the Senate where S.1480 has been stalled most recently by parliamentary maneuvering by members wishing to attach their tax cut proposals to any tax bill. Since the Superfund proposals are now considered tax measures due to the mechanism for industry funding, they became a prime vehicle for the tax cut maneuvering. The Administration, the media and many Congressmen will undoubtedly continue to approach the issues of oil spills, hazardous substances spills and dumpsites as a top priority. The media campaign aimed at attracting public attention to hazardous substances incidents has subsided but can be expected to intensify soon after the elections. The chemical industry and the business community will face the principal challenge during the "lame duck" session in the Senate, where the onerous and precedent-setting provisions of S.1480 continue to threaten. A more detailed status report follows. HOUSE OF REPRESENTATIVES The House has approved two superfund bills: one to clean up oil and hazardous substances spills, a second aimed at abandoned dumpsites. The two bills will establish three trust funds financed primarily by a tax on the oil and chemical industries. CMA 037710 The first, bill to pass the_Housa, H.R. 85 CBiaggi,D-NJ) had bean reported by threa House Committees: Merchant*Marina; Public Works; Ways and Means. H.R.35 passed by a vote of 288-3-11 on September 13. It will sat up two $375 million trust funds for five years, financed entirely by taxes on the oil and chemical industries. The bill deals with oil and hazardous substances spilled into navigable waters, and with in-placa pollutants. The chemical industry supported passage of H.R.35 in the House after Rep. John 3. Breaux, (D-LA) agreed tc offer an amendment (adopted] to limit a company's liability for a spill. Under the amendment EPA must determine that a spill of a designated hazardous substance involved a harmful quantity before a company could be held responsible for cleanup costs and economic damages. CMA considered this an absolutely essential amendment since it preserves the essence of an earlier compromise reached in connection with amendments to the Clean Water Act passed in 1978. The second Superfund bill, H.R.702Q (Florio,D-NJ), passed the House by 351-23 on September 23. H.R.7020 will establish a $1.2 billion trust fund for five years, to enable EPA to act on an emergency basis to clean up, each year, the 100 most dangerous abandoned dumpsites. Recovery of the cleanup costs would come from the responsible companies. The bill had been reported by two committees: Commerce, and Ways and Means. It requires the oil and chemical industries to pay three-quarters of the trust fund by means of a tax on oil and petrochemical feedstocks. H.R.7020 will give EPA new emergency powers to taka whatever remedial actions are deemed necessary to relocate, contain or clean up releases or "threatened" releases of hazardous substances from abandoned hazardous chemical dumps. It also would allow EPA to sue in federal court for recovery of cleanup costs from any company that "caused or contributed" to the release. The chief threat on the House floor came from Rep. Albert Gore, Jr.,' (D-TN). He had prepared three liability amendm nts for introduction, the most damaging of which would have established liability for third party damages. CMA considered the third party damages amendment as totally unacceptable. A compromise was eventually struck which resulted in a withholding of that amendment. The other Gore amendments were somewhat modified and adopted by the House. Together, H.R.35 and H.R.7020 will provide $1.95 billion to clean up oil and hazardous substances contamination, $350 million more than requested in the Administration's original proposal. CMA 037711 SENATE -3- The Senate has at least partially resolved the jurisdictional questions raised with respect to S.148Q by referring the bill to the Finance Committee until November 21. The Finance Committee held two days of hearings on the bill September 11 and 12. Dr, Louis Fernandez, Vice Chairman, the Monsanto Company, testified September 11 on behalf of CMA. Our testimony reemphasized that CMA has strongly supported legislation to address the problems caused by abandoned hazardous waste sites, and our belief that such legislation should include a federal response fund. That fund would permit necessary cleanup and containment activities at sites which present an imminent threat to public health or the environment and where no other party is taking responsible action. While still opposed in principle to industry funding, CMA expressed the belief that the most appropriate means of delivering the industry portion of Superfund costs would be through a tax placed on hazardous waste. Dr. Fernandez firmly expressed chemical industry oppositionto S.1480. The Senate Commerce Committee, which had requested jurisdiction over insurance and transportation aspects of S.1480, also held hearings September 11 and 12. CMA was represented September 12 by Jackson Browning, Director of Health, Safety, and Environmental Affairs, Union Carbide Corporation. Mr. Browning addressed S.1480 in terms of its disruption of the Hazardous Materials Transportation Act, the rail deregulation bill and the insurability of risks. The Commerce Committee has not been granted jurisdiction over S.1480, but Chairman Howard Cannon CD-NV1 has submitted a number of amendments in preparation for floor consideration. Several other Senators, including Randolph (D-W.VA1, Helms CR-NC1 and Schmidt (D-NM), have amendments pending. CMA*s program of communication in the Senate includes contacts with relevant Senators, the leadership and interaction with the business community. THE ADMINISTRATION The administration continues to place a high priority on passage of Superfund legislation this year. In an effort to break the deadlock in the Senate over S.1480 CMA 037712 the Administration has initiated a series of discussions with EPA, key Senate staffers and industry. To data, the discussions and informal drafts have centered around the S.148Q concepts and have yielded little progress. The Administration is hoping a compromise can produce a substitute for S.1480, and thus add new legislative momentum. CMA EC-10/27/80 BD-iQ/28/80 CMA 037713 1 1 1 \ LIABIL1T1 V CAUSATION DEl'EMSES DAMAGES, COSTS, LOSSES O o CO a.itoo 1 II.H. 1020 M.ti. IV> --Till* 111 (llatariloud Gubulance Strict, Joint and several (where person can apportion and show hit* contribution was not a significant factor, liability alia11 be Halted to tbat portion) Strict, Joint and several (with apportionment where defendant sstab- llabea tbat only a portion of damages ara attributable to hie watte). Strict, Joint tiul aever&l Cor owner or operator Could be looser than coaaon law causa tion (damages "resulting froa"). Alao a aodlflad showing of causation for proof of nedical aapanasa (preauaptlon of causa) Any person who "caused or contributed to" a raleasa or threatened releaae la liable (According to tha Coainlttec report, "Tha Connlttea Intends that the usual coupon law prlaclplae of causation. Including those of proximate causation, should govern the deterulnatlon of wbetlier a defendant "caused or cootrlbuted" to a releaae or threat ened release.") ConMon taw prlnclplea of consul lou are nslntalnad Caused aolaiy by an act or Sod or an act of war i Caused solely by >an act of God, act of war, negligence on the part of tha United States Goveriuaent, an act or oulaston of a third party (other then an employee or agent or a person In contractual relationship with defend ant) If defendant establishes ha exercised due care, or any coubtnatlon of the foregoing To extent ceusbd by a natural plienouenon, an act of war, mi act or onlesion of an lodepenlent third party or negligence of the clelaant ( Seaoval, contalnaent and cnergency responsei all daaagea for loaa duo to personal Injury or loaa of natural raaourcea. Including Injury to or loaa of uaa of raal or peraonal proparty or of natural raaourcaa, all out of pocket nedical aapenaaa, and loet tea revenue# flenoval, contalnaent and emergency assistance Itenovnl costs, injury to or deal.ruc tion of reel or personal property. Injury to or destruction of natural resources, loss of profits or ta ps Irncnt of earning capacity due to Injury or destruction of natural reaourcea If 25 percent of tnconu derived froa util list loti uf such resources- t I AS OF OCTOBER 1, 1980 1 fund size 1 mm source 1 LIMITATIONS OH AUK FEE I score 1 substances addressed 1 IHTER1H PERMITTED SITES O <4 Ol T S.lkflO 14.0&5 billion over elx years H.fi. 7020 (1.2 billion over four years 11.B. 85--Title III (Hazardous Substance Spills) $75 million per year (for five yaara) 510 nllllon Federal appropriations, tj.575 billion Industry fans (front-mi approach1 6$ percaot prlaary pstroehenlcala, 20 percent inorganic raw materials, 1$ percent crude oil) lOO million Federal approprlatIona, 1900 nllllon lnduatry feaa (front-end approach t excise tu oa apse tried patrocbanlcal feedstocks, Inorganic eubetancee and crude oil) All Industry fees (eaciae Uk on specified petrochemical feed stocks sad Inorganic substances) - i- Mo link between fees and Federal approprlatIona Spending from Fund United to 10 times the general revenue appropriated for that year Ho link between fees and federal appropriations Any roleaae or substantial threat of auch relaaaa Into the environment (However, recovery for Federally permitted releaaaa ahall be purauant to ealatlog lav) Salaaaa or aubatantlal threat of a relaaaa from an Inactive hazardous waste altst conditions atoller to but not lasted lately Identifiable as a raiaaaa of haierdoua vasta from an Inactive basardoua waata site Discharge or a aubatantlal threat or auch discharge of a hazardous substance Into navigable waters Any hazardous eubatance (which la very broadly defined). Also any pollutant or contaminant which stay prcacnt an imminent or aubataatial danger f Covered Natardoua waste (SCHA 3001) Excluded from general coverage but Administrator authorlied to taka emergency response actions at auch sites where there la an lantnsnt end aubatantlal audsogerment Substances designated under Section 311 of the Clean Water Act Covered for liability purposes if leaching designated hazardous aubstancea In harmful quantities Into navigable waters -1 "--nr FEDERAL CAUSE Or ACTION FOR PRIVATE 0AMA0E8 ADMINISTRATOR'S DISCRETION PREEMPTION SUNSET PROVISION S.1U80 II.H. 1020 IBS NO Uhnuvcr there la a releaae or a eubataatlal threat of a releaae of a baxardous substance Into the environment or a reteaaa or aobataatlal threat of a releaae Into the environment of any pollutant or contaminant which any present an Imminent or substantial danger, the President la authorised to reuova or contato the hasardoua sub stance, pollutant or contaminant or take any other emergency reaponae measure he Judge* aeceaaary. Upon receipt of evidence that a releaae or substantial threat of a releaae froa an Inactive elte presents or nay present an tanIneat end substantial endangernent, tin Administrator nay taka energency response action} When ever the Administrator determines that an Inactive site (on the top priority site list) presents or nay present an unreasonable risk of harm, he nay, after notice and opportunity for oonnant, take necessary remedial action or by order require any responsible party (owner, operator, generator or disposer) to take such action. II.R. 85--Title III (HaMrdouii Substance Spills) If3 NO NO tes Authority to establish and collect fees and obligate funds expires October 1, 1986. Unless reautborlxed, authority of Administrator would terminate five yeere after enactment The ecclee taxes and the trust fund would be effective as of October 1, I960, and would termlnata aftar September 10, 1985. The excise taxes and the trust funde would be effective as of October 1, 1980, and would termin ate after September 10, 1985. _ds 0 HAZARDOUS WASTE RESPONSE CENTER UPDATE Exhibit H At its September 8, 1980, meeting, CMA's Executive Committee approved a limited, full program for the Hazardous Waste Response Center (HWRC). The Executive Committee asked the task group to establish new operating guidelines for their activities. In brief, the guidelines for task group operation are: operate within the same manpower level as last year; work with the EPA in approaching and establishing priorities for their site management program; develop general protocols for site management that member companies can use? provide site management training for member company personnel, particularly smaller companies; and sampling and testing should not be part of the pro gram at CMA survey sites except for the health pro tection of CMA site workers. The HWRC task group is presently re-organizing to ac commodate the new guidelines. Our initial efforts will con centrate on two projects. First, the group will develop a site management flow chart and make it available to member companies. Based on the task group's accumulated experiences at Lipari, Motco, and Tate Cove, this document will present the steps in checklist form which we feel are appropriate for managing a presently inactive hazardous waste site. Second, the group will develop protocols for specific steps required by the site management document. An initial meeting with EPA explored which protocols would be of interest to both groups. During this meeting, we developed several interest areas for task group consideration. These are listed below: 1. Sampling and Monitoring e Drum consolidation -- present practice requires that each drum at a site should be sampled and analyzed. This is very expensice since each analysis can cost from $500 to $1000. Analysis costs could be reduced considerably if several or many drums could be con solidated and the resulting pool sampled and analyzed. A drum consolidation protocol would specify the nature of and how to gather information necessary to allow safe consolidation of drummed material for analysis. Analytical Methods for Concentrated Mixtures -- EPA analytical methods development is geared toward trace chemicals in aqueous solutions. They do not have ad equate analytical procedures for preparation and anal ysis of highly concentrated mixtures which are usually found on waste disposal sites. In particular, there is a need for analytical methods which are fast and can be used in the field. CMA 037717 -2- Sampling from Drums -- there are no economical and safe techniques for obtaining a representative sample of the contents of a closed'drum. These need to be developed. A groundwater monitoring protocol needs development's well. 2. Personnel Safety To protect on-site investigators and workers, the EPA presently requires fully enclosed chemical suits and selfcontained air under most situations. We are concerned that decreased maneuverability, impaired vision, poor com munication, and limited time for work may pose a greater threat to worker safety than the threat from possible chemical exposure. The HWRC task group should help EPA to develop guidelines for worker protection which balance these two threats. 3. Management Techniques At issue in this area is simply "How does one manage ac tivities at a waste site?" EPA realizes that industrial management techniques are forced to be efficient by mar ketplace competition; whereas, government management' techniques have no such forcing mechanism. HWRC task group might critique EPA's site management techniques on some specific sites and help to develop some general guidelines for both EPA and member company use. 4. Training EPA is very interested in CMA assisting them to develop and evaluate curricula for training on-site investigators and workers. The task group feels that the drum consolidation protocol merits initial attention. It has the potential for savings of superfund dollars and also individual member company dollars when they are faced with drums on their own sites or with re quests from state/federal agencies to reclaim their drums from abandoned waste sites. Thus, our first protocol project will be a drum consolidation protocol. The task group does not presently plan to continue site investigations as they were done last year, we expect this year's site studies will be undertaken in response to the need to field test any protocols which have been developed. Action Required] none, information only CMA EC-10/27/80 BD-10/28/80 CMA 037718 Exhibit I CHEMCAP STATUS REPORT AND PROGRAM REVIEW PLANS Virtually all originally planned chemCAP program elements are now in place. The four "hey issues" booklets have been printed; the slide presentation? motion picture film and Public. Service Announcements have been completed? News Media Tours programming has increased; the initial cycle of six advertise ments has been published; CMA's News Bureau is issuing more and more materials dealing with the five major concern areas. "Key issue" booklets, total number printed; Transporting Chemicals Safely Protecting the Environment Chemical Worker Safety Chemical product Safety 175,000 245,000 170,000 120,000 Overall Total 710,000 To date, 95 member companies have ordered the booklet, with 34 companies ordering in quantities of 1,000 or more. Not surprisingly, Protecting the Environment has proven our "best seller." We enclose it with all requests for materials, since it discusses the environmental problems which concern more people than any others. Advertising. The first cycle of six ads has been completed, and the ad agency is developing a more visually attractive design for a less expensive one-page format to appear December-June. As of the beginning of October, the six ads has stimulated 6,700 letters requesting booklets. Almost half the responses came from Time Magazine readers, while Newsweek accounts for a quarter and the New York Timas accounts for 15 percent. The ad on water quality elicited the most response. # News Media Tours. To focus on the No. 1 public concern of waste, six member-company experts on waste disposal have been added to the Science Advisory Group. Our goal is to book these experts in 30 target cities around the country, September-April. As of the beginning of September, the media tours had already covered 20 markets and resulted in 48 television and 60 radio appearances and numerous press interviews. CMA037T19 Neva Bureau. Members of the Science Advisory Group have been interviewed on hazardous waste issues for a second set of five radio tapes, just completed and sent to major markets and to member company communications personnel for personal place ment. Also distributed: Five issue papers recently prepared on the same subject. Several mailings have gone to editors of the National Newspaper Association--small daily and weekly newspapers. The 10,000 members of NNA have just also received in their association's publishers Auxiliary an advertising supplement containing feature materials on the five issue areas. Audio-Visual Materials. All public relations contacts of major companies have just received the 18-minute speaker's slide presentation, "The Chemical Industry: Meeting the Challenge of Change." Additional sets (cost $30) will include two scripts, a pulsed cassette tape and a speaker's guide. "Doing Something," the ChemCAP film, is being made available for member companies in early November. The 21 minute film (cost $125) comes in a case with an owner's guide. Five 30-second television Public Service Announcements derived from the film are in production. Because of TV programming over loads during the election and holiday seasons, we plan to send the clips to more than 800 targeted stations on a one-per-month basis after January. e Speakers Program. About 1200 Speakers Resource Manuals have been distributed throughout the industry, and 375 people are on our "up-date" list. As for companies that have started speakers programs or that have re-oriented programs by adding ChemCAP materials, many seem to be waiting for the slide presentation as a spur to program development. e Company Involvement. A rising number of companies appear to be getting involved in ChemCAP programming, particularly with employees (the best indicator of numbers is those ordering ChemCAP booklets). Steps have been taken to begin ChemCAP Community Committees in 12 cities and target areas. The key to their growth and effectiveness is company involvement and commit ment to ChemCAP-like programs in these local areas. e Tracking Research. "Focus group" studies are now being carried out to come up with a more effective ad. Analysis of letters responding to our ads show these to be overwhelmingly favorable. CMA 037720 A follow--up study to the original Cambridge benchmark study will take place in March and April, with a report and analysis ready by June; this will show the amount of progress since the bench mark study in January. ChemCAP Review and Future Planning. We have begun the process of reviewing ChemCAP and planning where it should be going after June 1981. The Long-range Planning Group of the Communications Committee met September 16. The full Committee then discussed the Group's recommendations October 21. The recommendations of the Committee are being presented to the Board's Communications Policy Review Group October 28, with a report and discussion by the full Board anticipated by January 1981. Action required - None. For information only. CMA BD-10/28/80 Exhibit J REPORT BY THE DIRECTOR OF G0VERN!1ENT RELATIONS WILLIAM.M. STOVER OCTOBER 14, L980 CONGRESS RETURNS NOVEMBER 12 FOR "LAME DUCIC" The House and Senate adjourned October 2 for a six-week recess focussed on the national elections. Members return November 12 to begin the first post-election session following a Presidential election in over 30 years. According to the leadership, the "lame duck" session was made necessary because work could not be completed on a range of money bills needed to keep the Government operating. The essen tials of the budget process -- reconciliation, the second budget resolution and appropriations bills -- are yet to be acted upon. The pressures of the calendar were not the only reasons for delaying these, money matters, however. Some Members contend that Democrats, faced by larger, deficits than predicted, prefer to delay action until after the elections. Controversy over timing of a proposed tax cut has also played a part. The Administration opposed action prior to election day, but encountered opposition and parliamentary manuevering from the Senate Finance Committee and from many Republicans. Beyond giving necessary attention to money bills, the agenda of the "lame duck" session, and its duration, are impossible to predict. The possibilities range from brief and pro forma to ex tended and controversial. The tone and content could well be determined by the outcome of voting on November 4. RAILROAD DEREGULATION BILL BECOMES LAW In the early morning hours of October 1, amid last minute debate on federal budget authorizations, both Houses of Congress overwhelmingly passed a comprehensive railroad deregulation bill. The conference report passed the House on a voice vote (after six teen hours of debate) and the Senate then approved it by 61 to 3. The President signed the legislation into law on October 14. CMA participation in the development of a desirable new law began even before our first Senate hearing appearance June 7, 1979. In the effort to assure that rail reform legislation would also produce improved rail service for the chemical shippers, CMA CMA 037722 -2- repeatedly indicated willingness^to permit railroads greater financial freedom. This objective was balanced, however, by concern for captive shippers, and our advocacy program was therefore aimed at obtaining acceptable maximum rate protection provisions. Other issues, such as an allowance for rail sur charges, contract rates and car compensation provisions, were also considered important by Association members. The Senate version, passed on April 1, 1930, provided important protection for captive rail shippers, primarily because of a Long/Cannon compromise amendment which establishes a threshold, to be set by the Interstate Commerce Commission (ICC), at which a shipper can challenge a railroad's rate. These goals proved far more difficult to achieve in Lie House where the original bill and a later Committee version allowed for wider freedom to railroads in raising freight rates without ICC review. The controversy then moved to the Rules Committee and the bill encountered considerable delay prior to the granting of a rule and in scheduling House floor action. 3y the time floor debate began in earnest the position of captive shipper interests had strengthened, as reflected in passage of the Eckhardt/Rahall amendment July 24. That amend ment was supported by GtA and a broad coalition of utilities, ports, labor, agricultural consumer and coal groups and rail roads. Sponsors of the original bill were then forced to delay further consideration. Ensuing deliberations resulted in the measure being again returned to the House floor. The Staggers/Rahall/Lee compromise amendment was Chen approved and the bill was passed by the House September 9. The House-Senate Conference produced still more controversy and manuevering, but details were worked out and the bill clear ed for final approval and the Presidential signature. PROSPECTS DIM FOR TAX CUT LEGISLATION THIS YEAR Extensive hearings were held in July and August on tax reduction legislation in both the House and Senate and a bill containing a tax cut package was reported by the Senate Finance Committee in September. No final action was taken on this issue before the election recess, however. Congressional approval of a major tax cut bill in the "lame duck" session appears unlikely. Regardless of the outcome of the elections, there probably will be little enthusiasm on the part of most legislators to become involved in such a complex and time-consuming issue at chat time. CMA 037723 -3- Whenever Congress decides Co address the tax reduction issue, capical formation incentives will be high on the priority list. The Committee will have at least three alternate deprecia tion proposals to choose from, namely: The "simplified Cost Recovery System" sponsored by Senator Lloyd Bentsen (D-TX) and adopted by the Senate Finance Committee in H.R. 5329, in which equipment and machinery would be classified in one of four recovery accounts of 2,4,7 or 10 years. The "Capical Cost Recovery Act" by Representatives James Jones (D-OK) and Barber Conable (R-NY) in H.R. 4646. This proposal, known as "10-5-3" replaces the useful life method of depreciating property with a simple formula that roughly halves depreciation time: ten years for buildings, 5 years for equipment and 3 years for cars and tight trucks. The Administration proposal concerning which details have not yet been revealed, but which is expected to accelerate depreciation by about 40%. It would retain the useful life concept. Our CMA Tax Policy Committee is holding a special meeting in Houston during the Semiannual Meeting to discuss the various capital cost recovery proposals under Congressional consideration.. The Committee hopes to reach a consensus on proposals CMA should actively support and desired modifications. EEC ACTIONS AGAINST U.S. EXPORTS The European Economic Community (EEC) continues to take actions against U.S. exports to the Market of man-made fibers and petrochemicals. We have formed an EEC Action Committee in response to the government's request that we jointly prepare a defense against EEC charges. Close coordination has resulted with five government agencies involved (U.S.T.R., U.S. Department of Conanerce, Energy, and State, and the International Trade Connission). Also, discussions were held with a European chemical Industry delegation in the period June 30th to July 2nd. There is an early indication that bilateral discussions may be held which would Include high level government/Industry teams. On February 15th, 1980, the EEC authorized the U.K. to impose quotas on polyester filament yam, and nylon carpet yam. On April 30th dumping duties were assessed on acrylic fibers. Actions have been taken against other man-made fibers. CMA 037724 Additionally, the EEC is carrying out dumping actions on selected products including styrene and vinyl acetate monomer. On August 15th, dumping duties were imposed on U.S. liquid ammonia nitrate. Dumping cases against para and orthoxylene are expected next.. Dumping- cases are being prepared on additional petrochemicals. There is heavy pressure exerted on the EEC government by the European chemical industries for a much broader action than dumping charges against petrochemicals such as imposition of some kind of import levy on petrochemicals generally. The EEC asserts that U.S. price controls on crude oil and natural gas provide a substantial (around 10Z) cost advantage to U.S. producers, and are a subsidy. The Market understands chat U.S. price controls phase out on crude oil in 1981 and on natural gas in 1985. However, they believe that solution is too long, range. The U.S. chemical industry and government have pointed out that U.S. hydrocarbon price controls are only a small part of the competitive problem, and chat the phase-out of U.S. price controls will eliminate whatever advantage they presently hold. Every action possible Is being taken to convince the European chemical Industry and Che EEC that no action should be taken that would bring unfortunate countermeasures. Total U.S. chemical exports of $17.3 billion In 1979 are nearly 42Z above last year's record, creating a surplus over imports of $9.3 billion. Exports were 11.7^ of 1979 sales. The U.S. government will continue to encourage this level of export activity. The indications are that the problem of high U.S. exports to Che EEC are continuing in 1980. RESTRICTIONS ON EXPORT OF HAZARDOUS SUBSTANCES The chemical industry has been criticized increasingly for exporting products restricted or banned in the United States. In the early summer of 1978, a government interagency working party including representatives of: Consumer Affairs (White House) Deparonents of: State FDA Agriculture EPA Commerce Consumer Product Safety Commission Energy Export-Import Bank HEW 0PIC CMA 037726 -5- Justice Defense Labor Treasury Action CEQ Nuclear Regulatory Commission Office of Management and Budget and other Executive Offices was formed to consider federal policy on the export, of hazardous substances. The catalyst for this activity was a controversy over exports of TRIS-treated children's sleepwear. Heading the effort was Esther Peterson, Special Assistant to the President on Consumer Affairs. Preliminary draft reports of the Working Group were obtained. A task group from the industry met with representatives of the Consumer Affairs Office, the CEQ, the Deparhnentts of Coamerce and State, and the Office of the Special Trade Representative in early 1979. Suggestions were made toward improving the report;, bun resulting changes were minor. The fifth revised draft of the Working Group proposal for an Executive Order was published in the Federal Register on August 12. It proposed that the government establish an inventory of "banned or significantly restricted substances" under major health and safety legislation already in place. It would be necessary to disseminate to foreign countries receiving the products a considerable amount of information on these products. Further, an interagency group would review this group of products and put those which are considered to be severe hazards on a commodity control list. Products on this list would require validated licenses by the Commerce Department for export or could be banned from export. The CMA Task Group believes that there is no gap in existing law or need for the Executive Order. It can accept, however, the proposed notification procedure if disclosure of confidential information is avoided and other Improvements made. It strongly opposes the export banning proposal including the requirement for export licenses. A CMA policy statement supporting this position was approved by the CMA Executive Committee on September 8. Extensive comments on the working party proposal were prepared and submitted to Esther Peterson. We have been informed, and it was confirmed in a New York Times story, that the Administration will not issue the Executive Order. The 97th Congress is likely to take this issue up in early 1981. CMA 037726 -6- EN--E.R..G...Y..: UTILITYOIL REDUCTION BIILL The President proposed to reduce utility use of oil and _ natural gas by 1 million barrels per day by 1990. The oil "backout" bill would provide $10 billion in grants to utilities and for cost-effective investments in conservation and alter nate fuels. The Senate passed a bill in late June. The House Energy and Power Subconanittee is currently considering a similar proposal; however, a recent staff draft added a number of environ mental requirements that may make it impossible for many utilities to switch from oil and gas to coal. As a result, this bill in its present form does not have the support of either the coal industry, the utilities or the Administration. A coalition of Northeast Governors has taken an active role in the legislation^ but it is possible that consumer and environmental issues may not be re solved in order to pass a bill this year. CIA looks upon any such proposals as a means to amend and correct the Fuel Use Act. ENERGY: FUEL USE ACT AMENDMENT Pending before the House Energy and Power Subcommittee is a bill which incorporates most of the amendments' to Che Fuel Use Act (FUA) which were developed by Che CMA Energy Committee, along with chose of the National Association of Manufacturers and the Council of Industrial Boiler Owners. At present, efforts are being'made to get cosponsors for this bill (H.R. 7500) in an effort to have it considered during the "lame duck" session of Congress or next year. CMA continues to communicate the need for continued definition of Congressional intent and legis lative changes to the FUA. ENERGY: NATURAL GAS RATE DESIGN STUDY As mandated under the Public Utiility Regulatory Policy Act (PURPA), the Economic Regulatory Administration (ERA) sent to Congress in lace May a study on the federal rate design for natural gas. ERA is required to make a formal proposal to Cong ress by November 9, 1980. It appears chat the formal recommenda tion will include an economic cost, or marginal cost pricing concept. CMA, coordinating with other groups, is watching_these developments closely. We are seeking to guard against an in equitable shift of higher gas costs to industrial users, thereby achieving the same results as incremental pricing. CMA plans to meet with key Congressional staff personnel to discuss our concerns over economic pricing principles which could be sub mitted by DOE. We have testified in the regulatory arena. CMA 037727 -7- ENERGY: INDUSTRIAL CONSERVATION INCENTIVES CMA continues to monitor legislative proposals designed to stimulate industrial energy conservation and lessen national energy demands. Both the CMA Energy Committee and the CMA Tax Policy Committee are analysing pending bills such as S. 3006 introduced by Senator Malcolm Wallop (R-WY). That bill proposes a 20% investment tax credit for alternative energy property, specifically defined energy property and qualified conservation property in addition to the present 10% investment tax credit. Another incentive measure is Representative Cecil Heftel's (D-HI-1) H.R.8177, which would increase current 10 percent tax credits for "alternative energy property" and "specially de fined property" to 20 percent, and create new 20 percent in dustrial conservation tax credit for investments that use lass energy per unit of output. Also it would increase current IQ percent credit for recycling equipment to 20 percent. ENERGY: SECURITY CORPORATION Dr. John Sawhill was named by President Carter to head the new U.S. Synthetic Fuels Corporation and five members of a Board of Directors were appointed subject to Senate confirma cion. The interim appointees evidently now have the authority to hire staff and operate until the end of the next session of Congress. ENERGY: MOBILIZATION BOARD The President proposed and both the Senate and House sub sequently passed legislation which would create an Energy Mobilization Board and put "critical energy projects" on a "fast track" through the granting of permits and compliance with other regulatory requirements. The big difference bet ween the two legislative proposals was that the House bill permitted only waiver of procedural rules. Even though the House-Senate Conference Committee agreed on a compromise, the House, in a floor vote, rejected the Conference Report and returned it to the House Commerce Committee. There is some feeling that this legislation can be revived during the post-election session if President Carter is re-elected. Republican support is unclear. The liklihood of a Presidential proclamation creating an EMB-like executive agency is remote. CMA 037728 I -8- PATENT LAW REVISION AWAITS. ACTION H.R. 6933, the patent law revision bill reported by che House Judiciary Committee on August 20, was sequentially referred to the House Government Operations Committee- at the request of that Committee's chairman, Hep, Jack 3rooks (D-TX). Mr. 3rooks objected to two provisions of the bill: (1) che section establishing the U.S. Patent and Trademark Office as an independent agency and (2) che section pertaining to government patent policy. On September 13, after two days of hearings, the Govern ment Operations Subcommittee on Legislation and National Security approved H.R. 6933, subject to an amendment which would delete the independent Patent and Trademark Office provision. On September 23, the full House Government Operations Committee approved the subcommittee version of the bill and oredered it reported. H'.R. 6933,' as reported, thus contains three principal parts: 1. Reexamination of contested patents in the patent office, 2. Government Patent Policy, and 3. Restructuring of the Patent Office fee system. The House Judiciary Committee accepted the Government Operations Committee's amendment. H.R. 6933 was scheduled for House floor action on the con sent calendar a few days before the election recess, but was not considered. If H.R. 6933 passes the House in the "lame duck" session, a House-Senate conference probably will be appointed to resolve the differences between this bill and two Senate-passed bills: S. 414, which would establish a uniform government patent policy for small businesses and non-profit institutions; and S. 1679, which would provide for reexamination of challenged patents in the Patent Office. f RESTORATION OF THE PATENT GRANT The ad hoc industry cask group which has been working on legislation to restore the patent grant for chemical products delayed in marketing by government regulation plans to renew its activities this fall in order to prepare for consideration of CMA 037729 -9- such legislation early in the 97th Congress. The prospects for a patent restoration bill next year will depend largely on the composition of the House Judiciary subcommittee re sponsible for patent matters. TSCA REAUTHORIZATION - H.R.7126, S, 1147 Chairman James Scheur's (D-NY) bill to reauthorize the Toxic Substances Control Act for two more years, FY 1981-1982, was not called to the House floor during September due to the heavy backlog of "must" legislation which needed to be acted upon before the election recess. H.R. 7126 remains on the calendar subject to call of the House leadership and a rule from the Rules Committee. The bill is expected to reach the floor after the House returns from, the election, recess. Disposition of the OTA contract (to conduct a chemical victim compensation study) provision of the House bill has not yet been resolved. Th Senate version, S. 1147 passed last year, would reauthoriz TSCA for FYs 1980, 1981, and 1982. It contained novictim compensation study or PCB incinerator study provisions, and a House-Senate conference would ordinarily be necessary to resolve differences between the two bills. CMA is monitoring developments closely. ECKHARDT HEARINGS ON CONSULTANT CONFLICTS Congressman Bob Eckhardt's (D-TX) Oversight and Investi gations Subcommittee is continuing its inquiry into the us and misuse of cost-benefit analysis in the regulatory decision making process. He has held three hearings dealing with specific examples of potential conflicts of interest alleged to arise when a regulatory agency contracts for an economic or other analy sis with a private consulting firm which has performed similar work for the regulated industry. One of these examples involved EPA's contract with A.D. Little (ADL) for an economic analysis of the proposed premanu facture notification regulations under section 5 of TSCA. The August 22 hearing raised such issues as whether ADL's work for EPA was influenced by the firm's involvement with chemical industry clients; whether problems EPA has had with economic analyses, such as the ADL study, are responsible for the signi ficant delays in the Agency's implementation of TSCA; and whether ADL attempted to merchandise its study for EPA as a "door-opener" for ADL to obtain new business with the chemical industry. CMA 037730 -10- Chairman Eckhardt concluded Che current phase of these hearings on September 30 by taking testimony from EPA's Barbara 3lum and representatives of the Department of Energy and the National Highway Traffic Safety Administration (the other two agencies involved in the three examples cited.) This hearingfocused on agency policy on the use of regulatory analyses, a listing of all rules or regulations delayed because of inade quate regulatory analyses, agency policy regarding contract practices and steps to identify and prevent conflicts of interest, and a list of all instances in which the agency has used private contractors to perform economic analyses subsequent to the use by the regulated industry of such contreactors to provide argu ments in agency rulemaking proceedings. A Subcommittee report is expected by the end of the year. HEARINGS ON BRAIN TTJMORS IN TEXAS CHEMICAL PLANT WORKERS No dates have yet been set for Congressman Eckhardt's Over sight and Investigations Subcommittee hearings on glioblastoma multiforma and other tumors reported in workers in petrochemical plants along the Texas Gulf Coast. However, preliminary results of the NIOSH/OSHA epidemiology investigations will be presented at the October 27-29 New York Academy of Science seminar chaired by Drs. Irving Selifcoff and Cuyler Hammond of the Mt. Sinai School of Medicine. This is expected to further fuel the debate on whether the reported 13 primary brain tumor deaths in the last 30 years at the Union Carbide plant and the 24 such cases in the last 40 years at the Dow plant exceed expected levels and are related to occupational exposure. Chairman Eckhardt is concerned that the NIOSH/OSHA studies will be unable to assign responsibility to specific chemicals, in light of the Supreme Court's benzene decision requiring the agency to demonstrate that a particular chemical poses a signi ficant risk to human health and that such risk would be reduced by the regulation proposed. The Eckhardt Subcommittee could hold hearings after the elections, or early in the next Congress. OSHA REFORM LEGISLATION Senator Schweiker's bill to exempt safe businesses from routine safety inspections, regardless of company size, is dead in this Congress. However, a Chamber of Commerce/NAM-backed exemption for safe small businesses (10 or fewer employees), passed the House August 27 as a rider to the Labor/HHS Appropria tions fop FY 1981. Chances of passage by the Senate in November appear to be good, since the Senate had previously approved a CMA 037731 similar measure as an amendment to the ERISA multi-employer pension bill in July. Any predictions should be qualified by the fact that the Labor/HHS Appropriations must survive the perennially controversial abortion debate. CHA does not, as a matter of principle, endorse such special exemptions for small businesses, but will be working with the Chamber of Commerce and NAM during the next Congress in an effort to achieve meaningful OSHA reform. A recently formed Occupational Safety and Health Committee Task Group, chaired by Allied Chemical's Jonathan Plant, is already at work identifying issues and developing recommended positions. PRODUCT LABELING HEARINGS On September 16 and 17, Congressman James Scheuer's (D-NY) Consumer Protection Subcommittee held hearings on H.R. 6977 to expand the Consumer Product Safety Commission's labeling authority. The bill would amend the Federal Hazardous Substances Act to extend CPSC's authority to cover chronic as well as acute hazards in the product labeling area. EPA's and OSHA's labeling activities, which are being addressed through the CMA Special Committee on Hazards Communications, were not raised as issues at this hearing. We are continuing to monitor the Scheuer Sub committee for possible developments or implications in the area of EPA/OSHA labeling regulations. HOUSE SUBCOMMITTEE ISSUES GROUNDWATER REPORT Rep. Toby Moffett (D-CT), Chairman of the Government Operations Subcommittee on Environment, Energy and Natural Resources, has held hearings on groundwater pollution and may hold additional hearings in November. This appears to be only the beginning of a growing effort by EFA and Congress to in vestigate the alleged widespread contamination of the nation's groundwaters. The Government Operations Committee September 23, approved a report entitled "Interim Report on Groundwater Contamination: Environmental Protection Agency Oversight." Rep. Moffett called a September 29 press conference to release the report which was based on data collected over the past two years by the EPA. CMA 037732 -L2- The Moffett report recommended that: (1) SPA continue vigorous cooperation with the states to enunciate as swiftly as possible a definitive national groundwater policy. That policy must be designed to locate potential threats to groundwater and eliminate them before precious groundwater supplies are irreversibly damaged. (2) EPA utilize its statutory authorities to the maximum extent feasible to protect our groundwater resources. (3) EPA report to the Congress on its progress coward protecting the nation's groundwater. Toward chat end, EPA should present within 120 days a report detailing any additional resources and statutory authorities needed to protect the nation's groundwater. Th*. EPA study which provided the. basis for- the. Moffert report was conducted under the authority of the Safe Drinking Water Acc. This study, known as the "Surface Impoundment Assessment" (SIA) was designed to locate impoundments containing liquid wastes and assess their potential impact on groundwater. Doug Costle, EPA Administrator,*released the SIA information to Moffett with the following caveats: The information, provided by the states and not the owners of the sites, was collected only to provide a "first round approximation" of the magnitude of the problem; the data did not provide conclusive data on specific sices; the information sources were often secondhand. Rep. Moffett's Subcommittee is preparing a questionnaire to send to the owners and operators of the 2100 industrial sices listed in the SIA study in an effort to firm up the data. CMA reviewed an early draft of the questionnaire and recommended technical changes to the Subcommittee staff. We will continue to endeavor to provide assistance to the Subcommittee. cma 3D-1Q/23/8Q CMA 037733