Document zQbxE6e2ZYB5o0Gvkpx73jdE7

agenda MEETING OF THE CMA BOARD OF DIRECTORS Tuesday, April 3, 1984 10:30 a.m. to 12 Noon 2:00 p.m. to 4:00 p.m. CMA Board Conference Room Washington, D. C. 1. Call to Order and Approval of Minutes of January 23*24, 1984, Meeting -- Chairman Fernandez 2. Report of Executive Committee -- Chairman Holmer 3. Treasurer's Report -- G. C. Herrman 4. Report of Finance Committee -- H. A. Sorgenti 5. Report of Nominating Committee -- Chairman Fernandez 6. Report of Membership Committee -- R. F, Bentele McCloskey varnish Company 7. CMA Committee Appointments -- R. A. Roland 8. Report of the President -- R. A. Roland a. Proposed Special Programs: (1) Butadiene; (2) Hydroquinone/Quinone b. Schedule of Meetings Fiscal 1984-85 -- Board of Directors, Executive Committee, and Finance Committee 9. Superfund Reauthorization Update -- Stacey Mobley, E. I. du Pont de Nemours & Company 10. Report of Task Group on Superfund Funding Alternatives -- Thomas G. Singley, Shell Oil Company 11. Report of Special Programs Advisory Committee -Chairman: Gary A. Sunshine, ICZ Americas Inc. 12. Reports of the vice Presidents: a. Technical Director -- G. v. Cox b. Director of Communications -- J. c. Holtzman e. Director of Government Relations -- w. M. Stover d. General Counsel -- D. F. Zoll 13. New Business 14. Adjournment TAB I 2 3 4 5 6 7 8 9 10 Next Meeting of the Board of Directors; Wednesday, June 6, 1984, at 5:30 p.m., in the Eisenhower C Room, The Greenbrier, white Sulphur Springs, West Virginia, followed by cocktails at 7:00 p.m. in the Eisenhower Reception Area and Dinner at 8:00 p.m. in the Eis nhower A Room. CMA 038068 2239 MINUTES of the two-hundred ninety-seventh meeting of the Board of Directors of the Chemical Manufacturers Association, Inc., held at CMA Headquarters, Washington, D. C., Tuesday, April 3, 1984. Directors: Louis Fernandez, Chairman George J. Sella, Jr., Vice Chairman Richard G. Askew Edwin C. Holmer Max S. Bass P. W. Ifland Alan Belzer John W. Johnstone, Jr. Raymond F. Bentele Robert D. Kennedy Louis W. Cabot Sidney M. Leahy Paul W. Chellgren John S. Ludington W. H. Clark, Jr. Robert H. Malott Lester E. Coleman Fred W. Montanari Ralph S. Cunningham John D. Ong Carl R. Eckardt Thomas E. Reilly, Jr. John T. Files Robert A. Roland Joseph P. Flannery David L. Rooke Robert C. Forney Vincent A. Sarni Floyd D. Gottwald, Jr. James F. Schorr Vincent L. Gregory Harold A. Sorgenti Ben C. Hayton Charles S. Stewart Paul F. Hoffman J. R. Street Secretary: Charles w. Van Vlack Treasurer: Gary C. Herman General Counsel: David F. Zoll By Invitation: Stuart T. Allen, SOCMA, E. I. du Pont de Nemours & Company David L. Saird, Jr., Exxon Chemical Company Timothy F. Burns, CMA Geraldine V. Cox, CMA Robert B. Hill, CMA Jon C. Holtzman, CMA Stacey J. Mobley, . I. du Pont de Nemours 6 Company Victor H. Peterson, CMA Vernon R. Rice, E. I. du Pont de Nemours & Company James H. Senger, Monsanto Company Thomas G. Singley, Shell Chemical Company David S. Smallwood, ARCO Chemical Company Richard G. Stoll, cma William M. Stover, CMA Julianne H. van Egmond, American Cyanamid Company 1. The meeting was called to order by Chairman Fernandez. 2. MINUTES OF THE LAST MEETING The minutes of the January 23 and 24, 1984, meeting were approved as distributed. : CMA 038069 2240 3. CORPORATE SECRETARY Mr. Roland announced the appointment of Charles w. Van Vlack as Corporate Secretary of the Association, replacing Bruce M. Barackman who has retired. ON MOTION, duly made and seconded, it was VOTED: That Charles W. Van Vlack be confirmed as Corporate Secretary. 4. REPORT OF EXECUTIVE COMMITTEE Chairman Holmer's reports on the specific actions taken by the Executive Committee at its meeting earlier that same morning were deferred and made part of the discussions of the corresponding Board agenda items. 5. TREASURER'S REPORT Mr. Herrman indicated that the full report had been previously mailed, and reported in summary that the use of reserves in the current fiscal year ending May 31, 1984, will be reduced to approximately $200,000 as a result of increased revenue and continuing control of expenditures. In addition, Mr. Herrman presented two resolutions and recommended their adoption. ON MOTION, duly made and seconded, it was VOTED: That the resolutions relating to signature requirements and the use of a facsimile signature machine for drawing on the Association's bank ac counts, as set forth in Exhibit A, be approved. 6. REPORT Of FINANCE COMMITTEE Mr. Sorgenti reviewed the proposed budget which had been revised as a result of discussions at the March Executive and Finance Conssittee meetings. The proposed budget, as distributed, contains an overall increase of 4.7%; provides some program changes; identifies a number of unfunded items; and authorizes an increase in personnel in the State Affairs and Federal Grass roots program areas. With respect to the unfunded items, the Finance Com mittee identified five projects totaling $165,000 which should be given consideration for funding if actual revenues received during the 1984-65 fiscal year exceed projections. During the course of the Finance Conmiittee's discussion, it identified the Engineering Standards program as one which might be transferred to some other appropriate organization. The Engineering Advisory Committee and staff will explore possibilities in this area. All other program areas were con sidered to be continuing priorities. CMA 038070 f\/ominaJir'f Comm 2241 The Finance Committee also recommended not tapping reserves in excess of $500,000 and seeking to build the level of those reserves to 40-50% of the annual budget. There was discussion of the dues being assessed to Canadian members and whether those dues remain appropriate. The Finance Committee agreed to review the matter and report back to the Board at a future meeting. Mr. Sorgenti, on behalf of the Finance Committee, then recommended ap proval of: e A fiscal year 1984-85 budget of $13,543,200 per Exhibits B, C, and D. e Funding through the current fee schedule, per Exhibit E. ON MOTION duly made and seconded, it was VOTED: To approve the recommenda tions as presented by the Finance Conmittee. Chairman Fernandez commended Mr. Sorgenti and the entire Finance Com mittee for their efforts. 7. REPORT OF NOMINATING COMMITTEE Chairman Fernandez presented, for information only, the slate of pro posed directors to be elected by the membership at the Annual Meeting in June. The proposed slate will be sent to the membership with the official notice of the Annual Meeting. 8. REPORT OF MEMBERSHIP COMMITTEE Mr. Bentele advised that the Membership Conmittee had examined the qualifications of the McCloskey Varnish Company and reeonsnended their elec tion. ON MOTION, duly made and seconded, it was VOTED: That the McCloskey varnish Company be elected to membership in the Association. 9. COMMITTEE APPOINTMENTS Mr. Roland presented the list of proposed chairmen and new members f the Association's standing committees and the list of interim committe CMA 038071 2242 appointments. Or. Fernandez reported that che Executive Committee had agreed that continuing effort was needed to spread the committee chairmanships among a wider number of companies. ON MOTION, duly made and seconded, it was VOTED: To approve the lists of interim and new committee chairmen and members of the Association's standing committees as set forth in Exhibits F and 0. . 10. REPORT or THE PRESIDENT Mr. Roland presented proposed programs on butadiene and on hydroquinone/ quinone. ON MOTION, duly made and seconded, it was . VOTED: To approve the proposed programs on butadiene and on hydroquinone/quinone as set forth in Exhibit H. Mr. Roland also reported on the schedule of Association meetings for the Board of Directors, Executive Committee and Finance Comittee for fiscal year 1984-85, as set forth in Exhibit I. 11. SUPERFUND REAUTHORIZATION Mr. Holmer summarized the deliberations and conclusions of the Executive Committee at its March 6 meeting on the Superfund Issue. It was agreed at the March meeting that: e Mr. Roland be given the authority and the flexibility to respond to any congressional initiatives regarding a new Superfund reauthorization bill which takes us away from the onerous provisions of the FloriO and Lent bills. e The spending level of the new bill should not exceed $640 million, the Administration's 1985 budget figure. e Funding alternatives will be provided by CMA's Super fund Funding Task Group. e No official CMA position will be taken without Board approval which is contemplated at its April 3 meeting. e If legislative developments present a situation of ex treme urgency requiring action before April 3, there will be no CMA policy commitment or public announcement until the matter is discussed with the CMA Officers and Executiv Committee and a decision made as to th appropriate course of action to be taken. CMA 038072 2243 Mr. Holmer than reviewed recant development! which require that some adjustments be considered in how the Association's strategy is being im plemented. These developments include the release that morning (April 3) of a revised Florio bill; the scheduling of a committee markup session on April 4; and the call from sympathetic House subcommittee members for more specific positions and language from CMA. After considerable discussion at its meeting earlier that morning, Mr. Holmer reported that the Executive Committee had unanimously agreed to the following general principles for consideration by the Board: e Continue to authorize Association representatives to approach subcommittee members to discuss substantive provisions and language consistent with the Association's adopted positions. e Authorize Association representatives to agree to an annual taxing level of approximately $600 million. e Advocate waste-end tax funding at the level of $300 million per year, based on a rate of $50 per dry weight ton. e Recognize that continuing the current CERCLA feedstock tax (with appropriate amendments) may be necessary to generate an additional $300 million per year. e Authorize EPA to borrow up to an additional $300 million per year to supplement the fund. e- Defer a final decision on the appropriateness of a gross receipts tax to provide additional funding. Request the Superfund Funding Task Group to explore the issue further and report back to the Executive Coassittee. e Public Compensation remains an unacceptable part of Superfund reauthorization. Mr. Mobley then reported on the details of developments in Congess during the past month (Exhibit J). Major points of his presentation in cluded: e CMA's testimony by Dr. Fernandez before the Florio subeonmittee was effective and well received. e E7A Administrator Ruckelshaus' testimony was not inconsistent with CMA's position. EPA will be prepared by December to dis cuss specific recommendations on reauthorization. e The full Senate Committee may begin hearings on April 11. e a draft of the new Florio bill will be available today (April 3). The redraft is likely to delete the fertilizer and mining indus tries from the funding provisions and further shift the burden to feedstocks. Public compensation will remain and the fund size is unlikely t be reduced. Markup has been tentatively scheduled for April 4 at 1:30 p.m. CMA 038073 2244 The Government Relations Committee Superfund Task Group requests authorization to approach the House subcommittee with specific legislative language. Mr. Singley reported on funding alternatives as set forth in Exhibit K. The funding report contained four options to raise approximately $600 million per year. This would be in addition to maintaining the government's general fund contributions at their current 12.5 percent rate. Each of the four op tions contained two common provisions: e $300 million waste-end tax levied at the rate of $50 per dry weight ton. e Authority for EPA to borrow up to $300 million annually to be paid back from future fund revenues and cost recoveries. The four funding alternatives presented were: e Impose a gross receipts tax. e Continue current feedstock tax with caps* gasoline additives exempted; and technical amendments. Expand feedstock tax utilizing a broader base of taxable sub stances . e Increase petroleum tax to 5 cents per barrel. Mr. Smallwood made a presentation specifically on the gross receipts tax, as per Exhibit L. With respect to the gross receipts tax, a letter from the Tax Policy Committee was noted opposing the use of such a tax (Exhibit M). The Board adjourned at noon and reconvened the same day at 2:00 p.m. There was considerable discussion on the policy, strategic, and tactical elements of the issue. Although a variety of viewpoints and suggestions were expressed, a consensus emerged on the appropriate posture for the Association to take at this time. ON MOTION, duly made and seconded, it was VOTED: That the following elements constitute the Association's program and position on Superfund reauthorization: e Association representatives be given the authority and flexibility to approach Representative Florio and/or other members of his sub committee to present and discuss substantive language consistent with the Association's positions on fund size; funding source alternatives; and other Superfund issues for which the Association has adopted a position. CMA 038074 2245 Public compensation provisions continue to be an unacceptable part of Superfund legislation. e With respect to fund size, authorize Association representatives to agree to an annual taxing level of approximately S600 million, to be raised as follows: - S300 million dollars from a waste-end tax at a rate not exceeding S50 per dry weight ton. - $300 million from the current CERCLA feedstock tax with the following modifications: - Exempt hydrocarbons used in gasoline. - Cap feedstock revenues at current levels. - Adopt CMA technical amendment package. - In addition, allow fund borrowing of up to $300 million per year. e The Superfund Funding Task Group should continue its efforts to define and develop further acceptable funding alternatives which will broaden the tax base, including further considera tion of a gross receipts tax. The Executive Committee will review the merits of that tax at a future meeting. e The Association should pursue an overall strategy that will: - Maintain and enhance the positive image and credibility established over the last several months on Superfund issues. - Continue to identify and exploit opportunities to delay the movement through the process of an unacceptable bill. 12. REPORT OF SPECIAL PROGRAMS ADVISORY COMMITTEE In Mr. Sunshine's absence, Mr. Roland referenced the report of the Special Programs Advisory Committee (SPAC) which had been distributed separately. Mr. Roland reported that there are currently 31 special pro grams in operation. He also reported that the Executive Committee had ap proved the reorganization of SPAC effective June 1, 1984. The new advisory committee will consist of three CMA Vice Presidents (Technical, Legal, and Administration) and two Association Directors, to be appointed by the Chair man of the Board. Pursuant to the Bylaws, Board approval is required for Directors to serve on standing cosssittees; therefore, ON MOTION, duly made and seconded, it was VOTED: That two Directors be authorized to serve as m mb rs of the reorganized Special Programs Advisory Committee. CMA 038075 2246 1 3. REPORTS OF THE VICE PRESIDENTS a. Technical Oicector. r. Cox's report is attached as Exhibit: ri. Additionally, 3ha reported on the Hazardous Materials Spills Conference wnioh will convene m early April. b. Director of Communications. Mr. Holtzman'i report is attached as Exhibit 0. Ha expanded on his report by highlighting the media visits that were undar way to support the Association's effort on Superfund. Ha solicited additional cooperation from Board members and their associates to participate directly m this program by agreeing to meet with the media m key media markets end congressional districts. c. Director of Government Relations. Mr. Stover's report is at tached as Exhibit P. He emphasised the need to reach the media in the next several weeks to obtain the maximum benefit in the Superfund debate. PRIVILEGED MATERIAL REDACTED 14. NEW BUSINESS Chairman Fernandas reported on developments relating to the "Entity" project. Although there have been preliminary reports in ths prsss. an official announcement is planned for the end of May. Or. Fernandas will report to the Board later this year on what additional resources will b rsquirsd to implsmsnt the "Entity" effort. It wes agreed that tha full mem bership would be briefed at the Annual Maeeing in June. On motion, duly made and seconded, the meeting adjourned at 3:50 p.m. tbius Fernandes Chairman of the Board Charles w. Van viack Corporate Secretary CMA 038076 CHEMICAL MANUFACTURERS ASSOCIATION BANK RESOLUTIONS exhibit a Background: in order to improve the efficiency of CMA's disbursement process. it is recommended that the Association begin using a check signing machine on its two commercial checking accounts. The resolutions to effect this change would be as follows: RESOLVED: that the Association's Commercial Checking Account at National Savings and Trust (No. 019-204403-0) may be drawn on only by check signed by any two of the following: Robert A. Roland, President; Gary C. Herrman, Vice President-Treasurer; or Peter R. Agnew, controller. The facsimile signature of Robert A. Roland may be used to countersign checks drawn by Gary c. Herrman or Peter R. Agnew (not to exceed $10,000 per check). RESOLVED: that the Association's Payroll Checking Account at National Savings and Trust (No. 019-204309-9) may be drawn on only by check signed by one of the following: Robert A. Roland, President; Gary C. Herrman, Vice President-Treasurer; or Robert A. Roland/facsimile. CMA EC-4/3/84 BD-4/3/84 CMA 038077 CHEMICAL MMUMCnMM ASSOCIATIOM executive sMMi amo ucowhoatioms an Funowo p*opomo luoorr Fiscal i**r Saglmlng June 1. '904 ine Ending nay 31. IMS EXHIBIT B I. 7h* oreoosed ft 94/85 3ud9t Intielpitai i 9*f1C't IM us* of -llarvai to tM littflt of J498.2CO. TaUl progrin exeanOtturtt of 91],934.200 4ro -teuostto ind total rtv*nu*i of S12.OU.000 ir Mticioetod. AutnoniM )rw"l of ISO *r# rNtiitN, to incrtas* of itvn itaff 1pm on* current fl SCOi year. Sismar'ts of griPM m rKMMM for funding irv prvtentvd at :ui <2 tnd *J of Mis docunent. TM tpectfte Budget recamtndatlon is: Aooroval of 4 flieal ytsr 1984/11 Budget of 513,934,200 it molested in Md audgat docmwntation mien *111 rtgulr* tn j| of r*unti '.a wo extant of 5490,200. II. Funding to luoport tM FT 14/85 Budget of 513.934,200 iitueas continuation af tM senodul# of f*dt U present** 00 B49* 3 Of Mil CM. TM specific funding rtCMMMdtlM 1| Ct)t Me ft* senedul* retain unenangod. Aeeroval af Ma tenvault af foot tor peg* 3 af Mis tM. If approved, CW ratarvat if adjusted far cMital leaultHlant im aaprodadon ire attioatod to m: Estlueted Current Contribution To totorves Invettaamt In Fix** AttOtt Current rear Beared ation Aaproslmta Cain Natarves Ntserv* 9 lual aasarves June 1, fT 83/14 ProjactaS ft 84/si tstiaataa ft 85/88 Eatiuated ft 88/17 Estlueted FT 87/88 Ettlaatsd Ft 88/89 Estimate 1901 I N/A 1 N/A 5 N/A (271,5001 (152,300) 128.700 (498,200) (170.000) 144.500 235,500 (150.0001 tso.ooo 309,500 (150.000) 150.000 394,700 (150.000) 150.000 492.400 (150,000) 150,000 t 1.252.400 5.987,300 5.435.100 5.171.100 5,900.500 1.375.300 1.187,700 47.5 44.9 39.0 38.8 38.9 39.5 40.1 CM policy it Mat rotarvoc aMgld rtMln in tM rang* af 25* ta 905 af ganartl operating atpantat. Hmovr. in order to m Mia ta fund inlactad unantleipatad projects Mould May aacaaa necessary v Ba tutaarliad By Me taard or Executive CdMrtttee durMf tM court* of a flteal year, future year planning prevldns tnat reserves Mould rtMta aC tM Mgk and of MU ran**, 1.*.. to*rtlMtaly 44* to 50*. At <1 detailad under tin at for future yaart* attlmtaa. ratarvat inertua In future yeart uualnf apprealaately a inertat* ta dual revenue in fY 85/Sd and 5* incraaaat tMrtdftar. AtHMing aaaraalMtaly 5* increases in central expentat. tM rati* af ratarvat ta genenl operatic* expanses will 0* aalntiinad *ltln guideline*. tit. At directed by tM finance md Executive Caalttaat, tM atpantat, revenue and partem*! of tM tdoeritely funded Saaclal frearant are* art costed an* pratdnta* as a saearat* operating activity. Actual staffing and mpansas In Mis irtt ail I ba dependant on tM nun*or and levs! of apaetal program undertaken ana supported by tpaclfle product eanufactirer ind usar grauet. Details are par tab v2* af Mis aoctMent. (V. In conformn* te previous guidelines Mat use af rtarvat Be Mia Bale* 5100,000. cartel* r*caananCtd leant rmein unfunaad. Mould actual revenues rectivaa during tM fltcsl yatrtxcaad Budget projection, tM finance Canalatee bat rinewinilid tubtaeuant review and eontiddrulan b* given ta tM possibility of finding tM five tap priority projaett Http*. TMa* requests are presented at tM alt of Mis V. In preparing Ml* year's prapand budget, *e nave continued a process begun last year Mien it designed ta group Cm activity into breed proera cstegorlts. TM go*' is ta denies* amancee clarity of presentattoe acress tM felt range of activities, loginning mtn tM M, Me pregree categories include: * Coneerclsl freduction of CMolcals 0 Waste Handling ind Olspetsl e Incidental CMmcat Upesure I Public n**lM e Occupational Safety 4 NaalM 0 Clean water a Clean Air 0 Cbmieal Product Olstributlon a Energy I feedstock Swap Mas a Taxacton I International Trad* o flam Hanigntmt I Design a fattest ane fretactlon af TacMology a State Legislative and 8a*il*Mry Mtwert * Mltl ProgrM Activities OM't budget and tM 1.400 earner amlayeo* mrdng Mrougn Me Cammed* and Task treat assist Me industry in tacn of Map* progrM mods ta: a letearck. Analyte and Oavetop Positions on Individual Issuae * Initiate or eedify legulttory Events a Initiate or Modify lagltlttlvo Events a Cmmalcate ta tM Industry sM TVou# tM Madia a Litigate Mims lesults a Mltipty taeect iSrpigi OtMr Organliatlaas mtk Mtual tatarasu CMA 038078 OOtCAL NMIFJtCTUKRf ASSOCIATION SUMUT OF OIUCT FfOVUM AM MMMCMUr AMO JUMONT ACTIVITIES FT *1/83 Actual. Currant faar (udaat * Frajaetlan, PrgpoiH FI 14/*! lutifat. (ittatM Futura Taart exhibit c SUWMT TOTALS OF JCVE-WI, OlHtCT 0M, <WUGE*CNT 8 SUFFONT ACTIVITIES FT (2/13 AuAltaa Mall: AaandH FT (3/04 laMat Frajacttd FT 81/(4 Actual iatuiti 'Towtaa FT (4/M JisasL. estimated Furuoc TEAM M (1/SI Citiaataa Citiaataa Citiaataa FT B|/(9 Citiaataa EEVEWJl: awBirmig Ouai 1 Atiattaanti 112,0*1.200 III,000,000 Invattaant 1,397.100 900,000 nmiimi (Nat of Eioantat) 200.(00 ISS.40Q Aanaaua Traa ar (Qua* Susaort toi Soacial FraarM Araa (4,100 AM Qtnar i*,aoo 13.700 S11.174.SOO 111,712.200 112.(39,100 113,*10,300 114.424,900 118,292,800 1.230,000 1,1(0,000 1.1(0,000 1.140.000 1,1(0,000 1,140,300 217.100 1(1.300 1(1,300 1(0,300 1(1,300 188.300 30,000 1,700 SCO TOTAL ICVtlM sis.rn.ooo st2.0n.300 112.Ml ,100 113,030,000 114.1(1.200 314,930.(00 SIS,712,200 518,(17,800 OIAECT FtOGIAM ACTIVITIES: waaltn, SaFacy mi cnartcal Aaftilattoaa S MO.SOO S Ml,<00 Cnairwwtal Actlaltlai (M.400 407,(00 Oiiti-iauttaa - iacIMImj tna CKaaicit Trait* sort man taanaary Cantar (CMOITOfc) 744,100 740,700 Eaarfy an* CnatnaaHaa 200.300 212,300 TaeMleal Acainutritioa Outiida CaiHultiAf 244,000 271.(00 Ml.(00 1,431,000 /Mart) caatiltttva tetivitiat CaalttioalM ActWHia* Fmril Srittrooti Damn Ml,000 11.000 111,(00 1.122.200 (0.000 100.000 Staca LaftiUtiva 1 fulitary A//1rt 2*1.100 441,700 CaMwitcatiam ra*rm 2.300.(00 2.441.100 Oanaral Countal Outtiaa Ltfal Faas 107.100 1.009,700 1.4*7.100 1.(00,000 Aa*w * Sum Sami eat 134,400 147,200 Attaclatlaa LIiIim 140.000 142.S00 S 4*2,100 S 730.300 I 7M.no 1 000,200 S 149.400 S 8*7,700 (74,200 720.700 734,700 794.(00 034.100 871,000 737,000 202.700 274.100 1,493.100 1.110.100 41,000 1M.OOO <84,400 2,230.000 1.001.400 1,110.000 141.000 1S9.000 701,100 210.000 317,(00 (34.000 1,247.(00 130.100 331,700 (07.400 2.431,000 1.100,400 1,(00.000 1(0,300 177,(00 (24.400 220,100 333,700 M4.S00 1,310.000 137,000 302.100 137.no 2,103.400 1.141.700 1,100.000 IM.SOO 1M.300 444,100 231.100 w,4oo (24.200 1.379.500 143,000 370,100 M9.no 2.UI.000 1.211.900 1.794.000 177,000 IH.IOO 900.900 243.100 347,900 Ml.100 1,444.300 111,000 344,(40 703,100 2,011.000 1,200,100 1,112,200 in,no 201,400 984,300 288.100 3M.3CO M0.2C0 1,518,800 180.(00 400.000 730.300 7.981.(00 1.344,000 1.944,900 191,100 218.700 TOTAL s *.710.000 sn.m.ooo S11.010.200 Slt.3M.200 111.103.100 S12.2M.OOO S12.U1.300 S13.S2S.S30 unallocated wuwfiocar m GCNEJUL SUFMOT ACTIVITIES: bacutlua Oatartaa* MMtlaat A Caaiaatlaaa Aecountln* mi htiiaii Sameat Coaeutar mi lateral (n/oraatlaa SMalcaa Arlnttaf * OlltrllotlaH S 702.700 t 201.000 4*2.400 237.100 201.000 73*.*00 S 230.(00 470.000 241,300 201,400 710,100 S 210,(00 403.300 241.200 207,200 (00,200 t 223,(00 114.100 370,400 222.200 040,100 S 230.000 040.300 3((.no 233.300 900.100 S 240.700 847,300 400,300 249.000 933.300 t 201,200 SM.700 420,000 297.200 879,800 274,200 (28,800 480,200 270,100 TOTAL S 1.*20.000 S 1.M3.200 S 1.122.400 S 2.139.000 2.2*1.100 S 2.310,100 S 2.470.200 S 2.8*9.900 total emu 111.(41^000 si3.on.2oa 112.132.(00 113.134.200 13,121.700 114.429.1M tll.M7.SM 814.1H.4M Caacntatlaa ta (Uta if) Aatartaa S 2,140.000 SI 1.011.100) S (271,S001S (410.2001 230.100 S XT*.800 S 194,700 S an,400 1 AUTH0012U FCASOMl 140 1U 144 111 | 1S3 Acrm ms not funco it ruu kmcosmif am not ituoco move | 153 SFCC1AL MOEOAN STAFF 1* -menu. wn---------------- K*(W LEU imixs S (4,100 s to - 11 to S 30.000 S -- 10 1* s -* s - | 1S3 11 s" | 113 | 1' CMA 038079 CHOtlOUL NANtTACTUROB ASSOCIATION proposed iuogct SumuY nr REVENUE MO EXPENSES ar natural expense classification FY 32/83 Actual, Current 'aar Su4*et A arUjeet:on, Praposee FY 34/33 SuiJgtt. EstiuatM Future vtirt EXHIBIT D ACvCNuE; NennersNip Ski I XlUlIMKM Invescnent Revenue Meetings(Net ef Expenses) Revenue from ar (Ohm Support W) Special Pro*ran Arpp All Omar Actual rY U/e3 Results Apprevee ft al/ae fuoeet ProjeCteC FT *v4 Actual Resultt Prppesed ft 94/US ItriWrt ESIINATEO FuIuRE TEARS ' H" i'Jse FT 1371T TT^TTve" . i t. as Cttiuateo Ettinatao Ettintaa Ctrnatat 1,011.200 111.000,000 V ,337,100 300.000 ,174.(00 (11,712.200 .235.000 1,160.000 I12.S39.300'iV0.fiO.3oo: I. IAO.000 1, ISO,000 >114..144206..090000 Si 4,292.SCO 1,140.300 201.600 1(6,600 217,900 166.100 IAS.300 Ul.300 1(3,300 164,300 14.100 11.000 11,700 30,000 3,700 (00 TOTAL .71*.000 112.04*.300 SI2.(11.100 1 ll.OM.'WO GENERAL EXPENSES: Salary ( Relate* CxppOM Enployee (eneflts Travel A Staff Tretnln* Qua*. Subscriptions A Push cat Iona Conputar Sorvicao wttiafi A uertinapt Outttoo Noat* A Puolle Relations NMta Tours Apvertistn* Targeted Olltrlet Canwnteatlons Rational Coawiicettens Propria Outtiao PrlotlNf, Art, A Grapples AuOIP Visual A PU'l Oirtet Pottos*, 9rpl|t A Opt)vary Oiroct Supplies A General Office Tates. Insurance A AuPU CHENTRtC Telepeeee Rent A Occupancy Cannon Costs Less: Support t* Special * ,349.300 *24.900 301.200 4.7M.100 | 1,716,100 1 (.1(0.100 H 1.419. IOC I (.711.1001 1.994.(00 1 6,291.400 1,020.600 .011,200 1.1(1.400 1,2*4,7QC 1,104.900 1,372,200 1,440.300 1M.M0 334,800 412.100 412,TOE 4(4,100 477,100 (00.300 12,300 7.300 44.000 79.200 30.000 66.300 71,(00 133.(00 69,200 101.100 211,100 99,(00 I07.00E 223,700 104,500 112.300 214.100 109.700 114.000 Z44.7Q0 Itl,200 121,300 2(3.000 :20.900 73.400 210,100 177.200 141.600 141,000 100,000 126.300 299,000 (0,000 19,100 359.000 m* 94,000 172.TOC 34.700 391.400 103.SCO 410,900 101, MO 411.600 111,600 100.000 US.000 1(0.000 1(9.000 194,(00 204,400 211,100 49,700 100.000 (0,000 (1,000 97.700 10.700 (3.400 (6.300 321.700 3SS.AOO 119.000 37.000 431,100 (4,400 7(1,300 721.300 324,700 411.S00 231.100 49.100 4(4.$00 72.500 710,S00 110.400 307.000 371.200 219.100 4S.S00 440.700 73,000 7(7.500 102.700 397,100 310.300 2(7,300 49.900 *11.300 14.000 871,(00 844,(00 417.900 410.200 270.200 (2.400 114.900 84.2001 915.200 921,700 434.700 419,100 440,(00 *41.100 243.700 a7,joo 19.000 (43.7001 91.(001 340.900 979.200 17,100 191.300 37,200 1,009.000 1.021,300 413.600 414.100 112.700 60.700 621 .(CO 102.100 1.0(9,400 I.079.100 (140.4001 (341,700) (34*,S0Q <3(4,7001 (174,(00 (M3.MO (412.900 <411,600 TOTAL t 9,444.300 S 9,974,200 S 9.742.100 (10.949,700 HI.111,200012,0*4,100 112.490.400 91.133,700 NAJOA OUTSIDE PPCKI3; Outsien Lepel Peat QutsiPP Cansultlnf Ceelltlenlnf Activities TOTAL S 1,497,100 Ml .400 11.000 1 1,100.000 11.1*0,000 ll.MO.OOO 1 1.400,00c I 1,744.0001 1.112.200 1 1,944,900 1,431.000 1,493,100 134,000 1*4,ME (24,200 691,XD (11,200 90.000 41.000 130.100 137.00C 143. 111.000 1 2.171.700 1 1,111,000 1 1,110,100 t 2.144,100 S 2.411.100 I 2,132.000 I 2,(14.700 1 2.791.70C TOTAL DPtRSIS 111,441,000 113,001,200 112.132.400 111,134.200 113,*,70*14,124.100 RS.llT.SOO 91,121,400 Contribution ta lutn of) reserve* 1 2.144.000 1(1,011,900)1 (271,100)1 (494,200) 1 211,10)1 309,(00 I 394JCQ 1 4*2,410 pWAUTTNHOORl rut) PERSONNEL 141 144 144 113 113 113 113 1(3 CMA 038080 EXHIBIT E CMCMiCAL MAM#ACTUUCSS ASSOCIAUCiM PROPOSED 8U0GCT SWftART FT 83/V3 Actual, Currant Tr Budget a Projection, prOOOitd FY 34/85 Budget, Eitlmnted Future Yoirt MEMBERSHIP FEE CLASSIFICATION: Over $400 allIion S100 - 1400 ellllon Under S100 ellllon Actual Approved FT 82/113 FI al/W Raiults* Budeet j 8,180.800 S7.482.000 2,910,100 2,803,000 990,300 915,000 ProjoCtM Ft j/44 Actual Retulcs Proooted FTM/M Budoat CSTlMAIEO FUTURE tears Ft v FT *4/87 FT B7/m FT ad/O'j CttieutrU Ettieatad Ettieatad Ettieatad $7,549,500 17.902,800 2.705,000 2,951,000 919.900 858,400 TOTAL Sli,081.200Sl 1,000,000 S11.174.500 $11,712,200| 82,839.900 83,810,300 114,425,900 SIS,292,500 Include* CoMMleatlons umiwt CHEMICAL SALES CALENDAR YEAR 19XJ S MILLION Under - 1.0 1.0 2.5 2.5 - 5.0 5.0 - 7.5 7.5 - 10.0 10.0 - 15.0 15.0 - 25.0 25.0 50.0 50.0 * 100.0 100.0 - 400.0 Over - 400.0 THE ABOVE PROPOSES BUDGET ASSUMES NO CHANGE IN THE SCHEOULE OF FEES (SEE BELOW) FROM FISCAL YEAR 1983/84 TO 1984/85 mcwership FEE S 940 1,885 3,230 4,575 5,390 8,730 8,000 0.03248* 0.02988* 0.02708* 0.02428** * uo to But not Mr* than tM eeMerthlp foe ehlch eould be obtained by aultlplying the alnlM Mount of the neat higher chealcal taloa bracket by the percentage factor applicable to the higher bracket. ~ Maaiei Fee UI4.M0 Canadian *Men S 1.SU (Flat Fee) CMA 038081 COMMITTEE APPOINTMENTS EXHIBIT F 1. International Affairs Group Allen E. Sherr, American Cyanamid Company Edward J. Sowmsky, UNIROYAL, Inc. 2. Tax Policy Committee A. William Gallagher, Chevron Chemical Company -- Term ending May 31, 1985*' (replacing G. Wesley Read, El Paso Products Company) 3, state Affairs Committee D. H. Brewer, Olin Corporation -- Term ending May 31, 1985 (replacing R. N. Williams, same company) CMA EC-4/3/84 BO-4/3/84 CMA 038082 COMMITTEE NOMINEES Effective June 1. 1984 EXHIBIT G 1. Chemical Regulations Advisory Committee Chairman: J. Ronald Condray, Monsanto Company Vice Chairman: Gerald A. Hapka, E. I. du Pont de Nemours & Company Term ending May 31, 1987: John D. Behun, Mobil Corporation Joel B. Charm, Allied Corporation Janice 0. Florin, Standard Oil Company (Indiana) Thomas W. Mooney, The Procter s Gamble Company George A. Rodenhausen, Celanese Corporation 2. Communications Committee Chairman: John F. Hussey, Monsanto Company Vice Chairman: Michael E. Thompson, Standard Oil Company (Indiana) Term ending May 31, 1987: Norman R. Angell, Chevron Chemical Company Leslye A. Arsht, Cabot Corporation Arthur C. Benedict, CXBA-GEIGY Corporation Frank M. Brogden, Tennessee Eastman Company Charles M. Coe, Allied Corporation 3. Distribution Committee Chairman: Frederic E. Allen, E. I. du Pont de Nemours fi Company Vice Chairman: Keith J. Bunting, Dow Chemical U.S.A. Term ending May 31, 1987; A. Cal Allen, Chevron Chemical Company Stephen F. Burke, Air Products and Chemicals, Inc. R. A. Christman, Mobay Chemical Corporation Howard E. Devoid, American Cyanamid Company Ronald M, Jacobson, Rohm and Haas Company 4. Energy Consulttee Chairman: James B. Borden, E. I. du Pont de Nemours & Company Vice Chairman: Gary S. Furman,'American Cyanamid Company Term ending May 31, 1987: James D. Beatty, The Procter & Gamble Company Edd K. Grigsby, Phillips Chemical Company John Q. LeKashman, Stauffer Chemical Company George M. Rose, Sohio Chemical Company William F. Zimmermann, Monsanto Company CMA 038083 2 5. Engineering Advisory Committee Chairman: j. S. Bardin, Allied Corporation Vice Chairman: William K. Wakefield, EMC Corporation Term ending May 31, 1987*. T. Robert Bell, Pennwalt Corporation Norman B. Hartsock, Eli Lilly and Company J. C. Hovious, Union Carbide Corporation Jack L. King, Borg-Warner Chemicals, Inc. G. Paul Lang, PPG Industries, Inc. 6. Environmental Management Committee Chairman: Thomas M. Heilman, Allied Corporation vice Chairman: F. 0. Bess, Union Carbide Corporation Term ending May 31, 1987: C. David Barrett, Celanese Corporation B. A. Barrosse, Jr., E. I. du Pont de Nemours & Company Gordon N. Lens, Chevron Chemical Company Russell H. Susag, Minnesota Mining and Manufacturing Company Richard A. Symuleski, Standard Oil Company (Indiana) 7. Government Relations Committee Chairman: Charles T. Marck, Dow Chemical U.S.A. Vice Chairman: Rady A. Johnson, Standard Oil Company (Indiana) Term ending May 31, 1987: Kenneth E. Davis, Rohm and Haas Company Robert J. Fields, FMC Corporation J. Wilson Malloy, Eastman Chemical Products, Inc. A. Allan Noe, Stauffer Chemical Company Colin Sandison, Exxon Corporation 8. International Trade Committee Chairman: Allan J. Spilner, Rohm and Haas Company Vice Chairman: Theodore F. Killheffer, E. I. du Pont de Nemours & Company Term ending May 31, 1987: Mark Blass, Air Products and Chemicals, Inc. Theodore F. Killheffer, E. I. du Pont de Nemours & Company George M. Mackie, Crompton t Knowles Corporation Donald H. Marshall, The BFGoodrich Company, Chemical Group Robert S. Reitzes, Monsanto Company CMA 038084 -3- 9. Occupational Safety and Health Committee Chairman: Harry A. Eschenbach, w. R. Grace & Co. Vice Chairman: Gary A. Sunshine, ICI Americas Inc. Term ending May 31, 1987: Claire w, Baughman, CIBA-GEIGY Corporation William A. Fishbeck, M.D., Dow Chemical U.S.A. John J. Fossett, Velsicol Chemical Corporation Gary LeClercq, M.O., Exxon Chemical Americas Ronald Van Mynen, Union Carbide Corporation 10. Patent and Trademark Committee Chairman*. Richard C. Witte, The Procter & Gamble Company Vice Chairman: Larry W. Evans, The Standard Oil Company (Ohio) Term ending May 31, 1987: John J. Hagan, American Cyanamid Company Patrick L. Henry, Allied Corporation Thomas L. Sager, E. I. du Pont de Nemours 6 Company Carl T. Severini, PPG Industries, Inc. 11. State Affairs Committee Chairman: James V. Murray, Union Carbide Corporation vice Chairman: Jerry Chambers, American Cyanamid Company Term ending May 31, 1987: Julie Archuleta, Occidental Chemical Corporaiton C. Robert Ball, Exxon Chemical Americas Charles E. Fitzgibbon, Eastman Kodak Company Talbot C. Smith, Pfizer Inc. 12. Tax Policy Committee Chairman: william M. Bellamy, Jr., Union Carbide Corporation vice Chairman: James C. Pugh, PPG Industries, Inc. Term ending May 31, 1987: Alan M. Breitman, American Cyanamid company Paul H. Durham, Phillips Petroleum Company George B. Erensen, Olin Corporation Robert T. Guinan, J. T. Baker Chemical Company James D. Knox, Hercules, Inc. Cornelius P. Powell, Air Products and Chemicals, Inc. James C. Pugh, PPG Industries, Inc. CMA EC-4/3/84 BD-4/3/84 CMA 038085 EXHIBIT H-l PROPOSED PROGRAM ON BUTADIENE Problem/Background Objectives Recommendation Impact Money Company Personnel CMA Personnel Action Required EPA has made a finding under TSCA 4(f) that butadiene may present a significant health risk and has initiated a 180-day review period which terminates May 7. It is anti cipated that EPA will issue an Advance Notice of Proposed Rulemaking (ANPR) under Section 6 of TSCA when the present review period ends. OSHA has also shown interest in the chemical through publication of a Request for Informa tion. In order to respond to initiatives within both EPA and OSHA, manufacturers of the butadiene monomer requested that CMA establish an advocacy program. Accordingly, the Special Programs Division convened an exploratory meeting which resulted in a decision to form a Panel. A proposed six-month budget was approved. The Panel will represent the interests of butadiene monomer producers, adopting and conveying advocacy positions, as appropriate. In order to support its positions, the Panel will collect information necessary to assess safety, environmental and health issues. It is proposed that the Executive Committee accept SPAC's recommendation for approval of this program. - Participating companies will support program activities and necessary over head. - One representative from each participating company. - No additional staff required. Approval of recommendation. CMA EC - 4/3/84 BD - 4/3/84 CMA 038086 Butadiene Program Panel J. L. McGraw American Synthetic Rubber Corp. P. O. Box 32960 Louisville, KY 40232 (502)448-2761 X249 Ms. Amy Shepard American Petroleum Institute 1220 L Street, NW Washington, OC 20005 (202)682-8475 Dr. Larry Andrews Arco Chemical 3801 Westchester Pike Newtown Square, PA 19073 (215)359-2011 Wayne A. Turner The Dow Chemical Company 2030 Dow Center Midland,. MI 48640 (517)636-8278 Jorge Olguin E. I. du Pont de Nemours a Co. 1007 Market Street, Legal Dept. Wilmington, DE 19898 (302)774-6078 Harold E. Serenbetz E. I. du Pont de Nemours a Co. Polymer Products Department Wilmington, DE 19898 (302)774-2846 Lawrence N. Curcio Exxon Corporation REHD, P. O. Box 235 East Millstone, NJ 08873 ( 201) 873-626-1 Vincent H. Johnkoski Union Carbide Corporation P. 0. Box 3005, Bldg. 3005 South Charleston, WV 25303 (304)747-2552 Dr. N. L. Morrow Exxon Chemical America P. 0. Box 241 Baton Rouge, LA 70821 (504)359-7939 Mr. Waveland Davis Goodyear Tire and Rubber Co. 1144 E. Market Street, Dept. Akron, OH 44316 (216)796-2121 100D Charles Richards Gulf Oil Products Company P. 0. Box 2001 Houston, TX 77252 (713)754-1174 Charles Ferraro Mobil Oil Corporation 211 College Road, East Princeton, NJ 08540 (609)452-1423 James J. Bonin Shell Chemical Company One Shell Plaza Houston, TX 77001 (713)241-1490 Dr. Jean-Claude Roger Standard Oil Company-Indiana 200 E. Randolph Drive Chicago, IL 60601 (312)856-2816 F. E. Bentley Texaco Chemical Company 4800 Fournace Place Bellaire, TX 77401 (713)520-3653 Legal Counsel Robert Sussman Covington and Burling 1201 Pennsylvania Avenue, NW Washington, DC 20044 (202)662-5270 CMA 038087 EXHIBIT H-3 PROPOSED PROGRAM ON HYDROQUINONE/QUINONE Prob Lem/Background Objectives Recommendation Impact Money Company Personnel CMA Personnel Action Required In December 1979, the Interagency Testing Committee (ITC) recommended to EPA that hydroquinone and quinone be considered for testing to determine their toxic effects on human health and the environment. EPA responded to these recommendations by issuing proposed test rules on these chemicals. The following studies were proposed: - Hydroguinone. mutagenicity, teratogenicity, neurotoxicity, reproductive effects, epi demiology, metabolism, environmental fate and environmental effects. - Quinone. carcinogenicity, environmental fate and environmental effects. In response to the proposed rules, the hydroquinone manufacturers asked CMA to set up a program on these chemicals. Accordingly, the Special Programs Division convened an explora tory meeting where a tentative budget to cover the initiation phase of the program was approved. The Program Panel will evaluate the testing being considered by EPA and submit comments in response to EPA's proposed rules. It is proposed that the Executive Committee accept SPAC's recommendation for approval of this program. - Participating companies will support program activities and necessary overhead. - One representative from each participating company. - No additional staff required. Approval of recommendation. CMA EC - V3/84 BD - 4/3/84 CMA 038088 \ HYDROQUINONE/QUINONE PROGRAM PANEL Robert F. Brothers Eastman Kodak Company 343 State Street Rochester, NY 14650 716-724-4792 Waveland D. Davis Goodyear Tire and Rubber Company 1144 E. Market Street, Dept. 1Q0D Akron, OH 44316 216-796-1112 EPIDEMIOLOGY TASK GROUP R. Hays Bell Eastman Kodak Company Health and Environmental Laboratories B-320, Eastman Kodak Rochester, NY 14650 716-722-2362 ENVIRONMENTAL RESEARCH TASK GROUP Michael w. smith Goodyear Tire and Rubber Company 1144 E. Market Street Akron, OH 44316 216-796-2362 TOXICOLOGY RESEARCH TASK GROUP R. Hays Bell Eastman Kodak Company Health & Environmental Labs B-320, Eastman Kodak Rochester, NY 14650 716-722-5036 Lawrence K. Hunt Goodyear Tire and Rubber Company Goodyear Research Goodyear Boulevard Akron, OH 44316 216-796-7445 CMA 038089 EXHIBIT I CHEMICAL MANUFACTURERS ASSOCIATION SCHEDULE OF MEETINGS 1984-85 BOARD OF DIRECTORS, EXECUTIVE COMMITTEE AND FINANCE COMMITTEE r 1984 Monday September 17 Tuesday September 18 Monday Tuesday October 29 October 30 8:00 a.m. 1:30 p.m. 9:00 a.m. 1:30 p.m. 9:00 a.m. Board of Directors Executive Committee Board of Directors Lodge at Pebble Beach** Pebble Beach, CA Executive Committee Board of Directors Galleria Plaza Houston, TX 1985 Monday Tuesday Monday Tuesday Tuesday January 28 January 29 March 4 March 5 April 2 Tuesday May 7 Wednesday June 5 8:00 a.m. 1:30 p.m. 9:00 a.m. 9:00 a.m. 9:00 a.m. 8:30 a.m. 10:30 a.m. 9:00 a.m. 3:30 p.m. 5:30 p.m. Board of Directors Executive Committee Board of Directors Boca Raton Hotel** Boca Raton, FL Finance Committee Executive Committee CMA Headquarters Washington, DC Executive Committee Board of Directors CMA Headquarters Washington, DC Executive Committee CMA Headquarters Washington, DC Executive Committee Board of Directors The Greenbrier White Sulphur Springs, WV **Indicates meetings to which spouse is invited CMA 8D-4/3/84 CMA 038090 ! exhibit j ! SUPERFUND STATUS REPORT l By Stacey J. Mobley, E. I. du Pont de Nemours & Co. CONGRESS i HOUSE Rep. James Florio's (D-N.J.) subcommittee has completed i hearings on the reauthorization of the EPA Superfund pro gram. Florio is expected to begin markup and consideration of H.R. 4813 and amendments as early as the week of March 19. o Rep. Norman Lent (R-N.Y.) has introduced his own i Superfund bill which will raise $1.1 billion a year from a tax on feedstocks and $.6 billion per year from a waste end tax. His bill has many provisions which we object to, but its positive points are: amends CERCLA 1 - it is for five years - no joint and several liability i no "victims" compensation f 1 ) * \ i ! i i t 1i iI i i |1 1ii! o The Public Works and Transportation Committee and the Ways and Means Committee have requested juris diction over Florio's bill. The Judiciary Committee is concerned about the liability and tort issue and may request jurisdiction. o Rep. Florio continues to talk positively about the Entity and he is willing to discuss any legis lative amendments that will assist in this effort. o Rep. John Dingell, the Chairman of the Energy and Commerce Committee, attended the March 15 hearings and asked questions about the funding levels, causation, and he said he wants Superfund reauthor ized in 1984. o EPA Administrator Ruckelshaus testified March 15 and supported Superfund reauthorization, but not until EPA completes a study of funding needs and other issues. He also said that compensation should not be a part of Superfund. o Dr. Louis Fernandez, Monsanto Company, testified for CMA on March 8. SENATE The Senate Environment and Public Works Committee may begin Superfund hearings during April. CMA 038091 2MEDIA The media has not been writing much about the Superfund reauthorization hearings on Florio's bill. ASSOCIATIONS CMA continues to hold regular meetings with other industry groups which are impacted by the Superfund legislation. Most other associations are working to get exempted from the feedstock or waste end tax. They are concerned about the liability and compensation provisions. CMA CMA has initiated an aggressive lobbying campaign in Washington and Congressional Districts armed primarily at the members of Florio's subcommittee, the Energy and Commerce Committee and the ways and Means Committee. Action Required: none Information only. CMA EC-4/3/84 BO-4/3/84 CMA 038092 ALTERNATE SOURCES OF SUPERFUNP REVENUE EXHIBIT K Discussion Since it is likely that reauthorization of CERCLA will call for an annual revenue level higher than the S300 million which would be provided by the waste-end tax, in January, the Executive Committee and Board of Directors asked the Superfund Task Group to explore various supplemental revenue options. Although CMA should continue to participate with the SPA to develop justifiable estimates of funding requirements, the Task Group can calculate annual tax needs of approximately $600 million, or twice the current level, and it is important to hold estimates in that range. The Task Group has considered various revenue sources in the context of benefit to the chemical industry and political-acceptability and has developed arguments in favor and against each of the options. It was the consensus that, of all the options considered for alternate revenue sources, the following represent the most advantageous and probable and are listed in order of preference. However, the wisdom of an exercise telling Congress how the chemical industry can be taxed must be questioned at this point in the debate. Common to each of these options is that the waste-end tax would provide the first one-half of the $600 million level and continuation of the current general revenue appropriation of 12.5 percent would add approximately $88 million per year. Further, as a "safety valve", EPA should be provided with expanded borrowing authority up to an additional $300 million annually to accommodate potential higher revenue needs. Options I* Receipts Tax An excise tax of 0.008 percent imposed on the gross receipts of all corporations with gross receipts in excess of $50 million annually. Some Arguments in Favor of Proposal 1. Powerful revenue raiser due to a very low percentage rate broadly applied. The first $50 million would be exempt and, thereafter, a rate equivalent to $8,000 on gross receipts of $100 million. Becomes more politically palatable because of this feature. 2. Broad based tax on all industries (services included). A tax on all industries/business is based upon an assumed recognition of full societal responsibility for the CERCLA program. 3. Should "public compensation" provisions be included in statutes, the broad based tax is the most equitable source of funding. CMA 038093 2 Some Arguments Against Proposal 1. This form of tax would penalize industries that must first invest substantial capital for facilities, equipment, and research and development before deriving any gross receipts. 2. Such a broad, new tax structure lends impetus to increase tax rates to retire the national debt and could serve as a source for infrastructure repair, social program and general entitlements programs. 3. The tax is unrelated to the ability of a corporate entity to pay and is clearly not related to the hazardous waste problem. "Service" industries would seriously object, as would any business that can demonstrate that it does not produce "hazardous" waste. 4. . cma's support of such a tax could backfire in the form of intensive opposition by other industry groups which may, in turn, advocate measures seriously disadvantageous to the- chemical industry. 5. It is unlikely that Congress will accept the concept, especially in a.general election year. Tax credits for the gross receipts tax would reduce the corporate income tax contributions, thereby creating an indirect subsidy while increasing federal budget deficits slightly. II. Current CERCLA Tax Maintain the existing taxes with three principal amendments: (a) adoption of technical amendments package} (b) specifically exempt hydrocarbons used in gasoline from separate taxation as chemicals; (c) freeze level of revenues to be raised from tax at current level of revenues to be raised from tax at current level of approximately $300 million per annum. In case of modification of the CERCLA tax, such elements as improvements in the pass-through mechanism haven't been fully addressed but don't appear as promising as once thought. Soma Arguments in favor of Proposal 1. Most realistic based on congressional and Administration preference for current system. "Reliable" revenue base, taxpayers identified, perceived as workable system with potential to be passed through to consumers. 2. Politically supportable by industries other than the petrochemical industry and also preferred by many CMA member companies. CMA 038094 3 3. Necessary revisions in the application of the tax can probably be achieved, subject to political considerations, 4. Inequities in the current CERCLA tax are probably acceptable when limited to current levels and combined with the wasteend tax. Some Arguments Against Proposal 1. Counter to CMA's arguments supporting the waste-end tax in place of the current CERCLA tax. 2. Endorses perpetuation of the inequities forced by the current tax. Retains the same narrow taxing base within the chemical and petroleum industries, generally unrelated to the hazardous waste problem. Ill. Expanded CERCLA Tax Continue to finance CERCLA through current system, but broaden tax base to include other substances (similar to Florio/Lent approach or include "hazardous" substances). Some Arguments in Favor of Proposal 1. The "reliable" revenue source of a "feedstock" tax system would be retained. Has support in Congress. 2; includes other industries not currently paying into the fund and might provide greater incentive to monitor EPA's activities. 3. Inclusion of "hazardous" substances would place a greater reliance on risk assessment than "deep pockets" and would more appropriately correspond to the "release" concept of CERCLA. Some Arguments Against Proposal 1. Generally would only rearrange taxes within the chemical industry and does not broaden the tax base widely. Could encourage inclusion of gasoline blending components. 2. Strong objection can be anticipated from industries that would be subject to an expanded listing, particularly the mining and fertilizer industries. 3. Would still not have a direct relationship to hazardous waste disposal activities and may increase susceptibility of fund to public compensation provisions. CMA 038096 4- IV. Increase Petroleum Tax Increase the current CERCLA tax on crude oil and petroleum products from .790 par barrel to 5.0C per barrel. Arguments in Favor of Proposal 1. Tax system currently in place and relatively simple to collect. Perceived that costs can be dispersed throughout the products system. 2. Imports have no competitive advantage since collected at refinery gate. 3. Preferred by some CMA member companies. Some Arguments Against Proposal 1. Tax imposed upstream and difficult to pass on. Impacts only one segment of industry. 2. Tax already considered seriously as a deficit reduction device -- at a higher rate -- by both Administration and Congress. There may be strong pressure against loading another, fairly limited tax increase on petroleum, even though the tax is already in place. 3. Provides encouragement to include gasoline blending components and other petroleum based tax schemes. 4. Encourages taxation of natural gas used as a feedstock to product chemicals. Recommendation CMA should consider which option to focus on and if the Plorio bill does not pass in regular session, at least fully develop an appropriate proposal for a possible lams duck session and certainly for 198S. The Superfund Funding Task Group should be sunset except for that specific task. ACTION RBQOIRED: Information Only CHA EC 4/3/84 SD 4/3/84 CMA 038096 CORPORATE GROSS RECEIPTS TAX EXHIBIT L RATE: TAXPAYERS: EXEMPTIONS: 380 per SMM Gross Receipts Corporations Filing u.S. Income Tax Returns Gross Receipts Less than S50MM 1980 CORPORATE BUSINESS RECEIPTS Summary ($ in Millions) Number of Companies Business Receipts Net income All Companies 2,710,538 35,731,616 $ 296,787 Over 350 Million 8,192 33,650,690 5 201,059 Percent 0.31 64 68 Source: 1980 Statistics of Income, Corporation Income Tax Returns, U.S. Department of the Treasury, IRS, Publication 16 (Rev. 5-83) CMA 038097 CMA MEMBER COMPANY EXPOSURE CORPORATE GROSS-RECEIPTS TAX Company Exxon Mobil Texaco DuPont Standard of Indiana ARCO Shell Phillips Procter & Gamble Dow Union Carbide Monsanto W. R- Grace American Cyanamid Pfizer Merck , Celanese Hercules SCM Upjohn Rohm & Haas Stauffer Ethyl Air Products Reichhold Lubrizol Dow Corning Mallinckrodt Stepan Essex Estimated Gross Receipts ($ MM) 94,591 58,515 41,100 33,331 29,500 25,937 19,678 15,465 11,994 10,618 9,061 6,325 6,128 3,454 3,453 3,063 3,062 2,469 1,855 1,829 1,828 1,618 1,614 1,569 815 801 663 442 208 161 0.QQ8J Tax ($ MM) 7.6 4.7 3-3 2-7 2.3 2-1 1*6 1*2 0.96 0-85 0*73 0.51 0.49 0.23 0-28 0.25 0-25 0.20 0-15 0-15 0-15 0-13 0.13 0-13 0.065 0-064 0-053 0.035 0-017 0-013 CMA 038098 -3- ARGUMENTS IN FAVOR Fairness Minimal Economic Distortion Guaranteed Revenue Generation Administrative Simplicity \ 1> i * CONCERNS Unrelated to Ability to Pay Expansion to Cover General Entitlements and Reduce Federal Budget Deficit / il CMA 038099 EXHIBIT M THE DOW CHEMICAL COMPANY 2030 Willard H. Dow Center March 26, 1984 MIOIANO, MICHIGAN MAM Dr. Louis Fernandez CMA Chairman of the Board Monsanto Company 800 N. Lindbergh Blvd. St. Louis, MO 63167 MAR 29 1934 '"'Mr. Robert A. Roland CMA President 2501 M Street, NW Washington, DC 20037 Gentlemen: SUPERFUND/GROSS RECEIPTS TAX PROPOSAL I am writing to you on behalf of the CMA Tax Policy Committee. At the Tax Policy Committee meeting held in Washington on March 21, the issue of the use of a gross receipts tax as a replacement for the present Superfund was thoroughly reviewed. It is a fair statement that the tax people present were strongly opposed to any proposal that would recommend the U. S. Congress adopt a gross receipts tax for any purpose. Two powerful reasons exist to support this position. A gross receipts tax has immense potential as an income generator and its abuse once adopted would almost be certain. In addition, the threat of imposition of that tax would almost certainly martial the entire business community, outside chemicals and petroleum, solidly against us. A gross receipts tax on business in the range of 6 percent would have the potential of eliminating the $200 billion federal budget deficit. A gross receipts tax could fund the wildest forms of victim's compensation or national health care schemes that could be developed. Its impact on the business community in general would be both awesome and awful. Its impact, if fully developed, for a capital intensive business like chemicals or petroleum refining, could be devastating and crippling. This is particularly true since the tax would be payable in years in which a specific company might have no profits or even a substantial loss. Gross receipts taxes have been given brief consideration in respect of financing two world wars; and because of the illadvised nature of the tax, they have been shrugged off as unacceptable. This is true even in th face f adopting very high rate excess profits taxes. CMA 038100 Superfund/Gross Receipts Tax Proposal Page 2 March 26, 1984 It is not even clear that a gross receipts tax would be constitutional since it reaches beyond the concept of "income" in the normal sense of that term. The U. S. Constitution forbids a federal direct tax other than one which is apportioned. This issue is not perfectly clear but one which we would certainly raise in defense of our companies if such a tax were imposed. Other companies would almost immediately perceive the adoption of even a very low rate gross receipts tax as a serious threat to their economic position. Even if they are wrong in their perception of the orphaned waste dump site as a chemical industry issue, I am convinced that is their perception. There can be little doubt that they would bring their collective muscle to bear to crush this idea as swiftly as possible. In a positive fashion, it is suggested that we refocus every one's attention on the purpose of Superfund; that is, to provide funds to clean up dump sites, particularly those sites where the originators can no longer be found or held legally responsible. Let's concentrate on funding that problem in a reasonable fashion and working hard to convince the tax writing committees that a waste end fee backed with appropriate alternate financing, including borrowings, b available to make up shortfalls. I thank you gentlemen for taking into consideration the views of the Tax Policy Committee on this issue which is primarily a tax issue. Sincerely, CaJ. tU Glenn W. White Chairman, Tax Policy Committee Director Tax Department cc: Mr. Edwin C. Holmer, Exxon Chemical Company Mr. D. L. Rooke, The Dow Chemical Company CMA 038101 EXHIBIT N report of the technical director The Technical Director's report highlights CMA accomplishments and activities in its advocacy of prime issues. commercial production of chemicals CHEMICAL INDUSTRY INSTITUTE OF TOXICOLOGY - The CUT will host CMA's Chemical Regulations Advisory Committee at its annual meeting, March 21, 1984, at Research Triangle Park, NC. CMA News will cover this event. e CRAC'S INFORMATIONAL MEETING - On April 19, 1984, CRAC will sponsor a TSCA Informational Meeting in Washington, DC. The meeting's theme is "TSCA Implementation On the Move." MEETING WITH DR. JOHN A. MOORE, ASSISTANT ADMINISTRATOR, OFFICE OF PESTICIDES AND TOXIC SUBSTANCES - On February 14, 1984, CRAC met with Dr. Moore for th'e first time to discuss EPA's implementation of TSCA and CRAC's activities. Dr. Moore is concerned about the confidential business information issue as it relates to TSCA. He noted that industry must be prepared to address the perception chat too much data is claimed confidential under TSCA. ADMINISTRATOR'S TOXIC SUBSTANCES ADVISORY COMMITTEE (ATSAC) - On behalf of CMA, CRAC representatives will participate in the March 28 ATSAC program. The CRAC representatives and other interested parties were invited to discuss the confidential business information issue. This is the first ATSAC meeting since Dr. Moore's appointment. NATIONAL RESEARCH COUNCIL STUDY! TOXICITY TESTING STRATEGIES TO DETERMINE NEEDS AND PRIORITIES - On March 2, the National Research Council (NRC) released a study which found that toxicity data for chemicals in coamtercial use are scarce, particularly for those chemicals regulated under the Toxic Substances Control Act (TSCA). CMA Issued a statement concerning the NRC study on March 5. The CMA statement pointed out that hazard evaluation is not based solely on toxicity data and chat when exposure and other information is considered there is often no need to perform the extensive set of tests that the NRC Included in their study. The CRAC Testing Task Group is reviewing the study so that CMA can answer questions regarding the seemingly insufficient amount of toxicity data found by the NRC researchers. e WORKSHOP ON INDICATORS OF DATA DOCUMENTATION - CRAC's Reporting Task Group la planning a workshop for May 8-9. The workshop will develop a set of indicators that characterize the completeness of health and environmental data references. These indicators vlll provide data base users a simple means of discriminating between poorly documented data and well-documented data. Another objective of this workshop is to recommend a format to the technical community for use of these indicators by data reviewers and generators. The workshop is being cosponsored hy the National Library of Medlcln and the Council on Environmental Quality. CMA 038102 2 RISK MANAGOIENT - CMA negotiated a contract with Government Institutes. Inc. to publish the proceedings of the Risk Management of Existing Chemicals Seminar. The proceedings and an executive summary will be published in June 1984. CONFERENCE ON STRUCTURE ACTIVITY RELATIONSHIP (SAR) ANALYSIS - On June 6-8, CMA is cosponsoring, with the American Chemical Society, a conference on SAR Analysis and Toxicity Assessment. The Conference will explore the state of the art in SAR analysis and its application in assessing the ecological and human health effects of chemicals. Representatives of CMA member companies will participate in the presentation and panel discussions of the conference. BIOMEDICAL AND ENVIRONMENTAL SPECIAL PROGRAMS ARSENIC - CMA awarded a contract to the University of Pittsburgh to study the relation between exposure to Inorganic arsenic and respiratory cancer risk among workers at a smelting plant in Tacoma, Washington. The new study and CMA's ongoing epidemiologic study at the University of Michigan are Intended to determine if there is a threshold level for carcinogenic effect due to arsenic exposure. The results of these two studies are expected to be available in early fall. BUTADIENE - CMA submitted comments to EPA and OSHA on March S in response, to the agencies' requests for information on 1,3-butadlene. Conents addressed toxicologic and epidemiologic issues, exposure to butadiene in the workplace, and allocation of regulatory responsibility between EPA and OSHA. CHLOROBENZENES - CMA recently released a final report on in vitro studies of three chlorobenzenes. EPA will use the studies, in conjunction with other data, to make a decision on the need for oncogenicity testing of l,2,4-trlchlorobenzene. The research was done as part of a negotiated testing agreement. EPOXY RESINS - CMA filed comments on EPA's December 30, 1983, Advance Notice of Proposed Rulemaking on testing of the "glycldol and its derivatives category." The Epoxy Resins Panel offered an improved definition of the category and recommended several modifications to EPA's proposed subcategorixatlon scheme. The Panel also provided EPA with a proposed testing program for the category. ETHYLENE DIBROMXDE - CMA testified at OSHA hearings on the proposed occupational health standard for EDB on February 10, 1984. The EDB Panel staced that it was technologically and economically feasible for manufacturers to meet OSHA's proposed 100 ppb PEL (8 hour TWA), but that it was not feasible to meet the lover PELs of 43 ppb and 13 ppb proposed by other groups. FLUOROCARBONS - On February 21, 1984, the National Academy of Sciences (NAS) released its "Causes and Effects of Changes in Stratospheric Ozone: Update 1983." For its second consecutive report, the NAS estimate of ozone depletion in the stratosphere due to ehlorofluorocarbons alone was reduced 2 to 4Z. When changes caused by other trace gases are taken lnt account. CMA 038103 Che atmospheric models calculate a slight Increase in total column ozone over the next century. h'AS indicated chat the new estimates result not only from Improved mathematical models, but also from better measurements of the atmosphere now available. GLYCOL ETHERS - The CMA Glycol Ethers Panel is preparing comments in response to EPA's January 24, 1984, Advance Notice of Proposed Rulemaking regarding potential regulatory action on four glycol ethers. The Panel has hired consultants in Developmental Biology and Risk Assessment to assist with the development of a response. HYDROOUINONE/QUINONE - CMA requested and received an extension to the comment period on EPA's proposed testing rules on hydroqulnone and quinone. Comments on these rules will be submitted in early April, 1984, KETONES - In February, 1984, the CMA Ketones Panel submitted a status report to EPA on the MEK/MIBK Negotiated Testing Program. The report indicated that the MIBK teratology study had begun and the final report is expected in May, 1984. EPA vary recently audited the study. METHYLENEDIANILINE - The CMA MDA Panel has almost completed its "Survey of Non-MDI Uses of MDA." PHTHALATE ESTERS - EPA Activities - The CMA Phthalate Esters Panel is preparing a report on its Phase I Environmental Effects Testing Program which will summarize the test data, propose the next phase of testing under the Negotiated Testing Agreement with EPA and recommend acceptable environmental levels of various phthalate esters. The report will be sent to EPA as part of the Phase II testing proposal. CPSC Activities - The Panel has requested that the Connisaloners reconsider their denial of the Panel's appeal on their Freedom of Information Act request for interim and draft reports on exposure studies conducted by CPSC. The Panel has also appealed to the Commissioners to reconsider the CPSC Staff's response to the Panels request for a third-party audit of a CPSC-sponsored exposure study. Miscellaneous Activities - Panel representatives recently met with members of the National Sanitation Foundation to discuss the toxicity data on phthalates and their implications for risk assessment. The Foundation reviews formulations for use in building water systems, and has stopped reviewing formulations containing phthalate esters while it evaluates the safety of the compounds. The Foundation's Safety Committee will meat within a month to develop guidelines for approving these formulations. PHOSGENE - The CMA Phosgene Panel's Medical and Toxicology Task Group met with scientists at Johns Hopkins University to discuss a proposal for studying the pathogenesis and treatment of phosgene poisoning. This proposal will be considered by the Panel at their May meeting. Members of the Engineering and Safety Practices Task Group continue to evaluate CMA 038104 4 proposals for designing detection and monitoring instrumencion for phosgana. VimiDENE CHLORIDE (VDC) - In October, 1983, EPA announced tha availability of an external review draft of its Health Assessment Document for VDC. CMA filed comments on the draft in January, 1984. In the comments, the CMA VDC Panel presented its opinion that EPA ignored the preponderance of negative data and made a quantitative carcinogenic risk estimation in man from limited positive data. The Panel will present its oral argument at EPa's Science Advisory Board Meeting in April, 1984. EFFECTIVE WASTE HANDLING AND DISPOSAL e 1983 HAZARDOUS WASTE SURVEY - The 1983 survey of chemical Industry hazardous waste disposal practices was forwarded to the member companies at the end of March. The 1983 survey was designed to supplement the data collected as part of the 1981/1982 survey and will further enable CMA to analyze chemical waste disposal practice trends. CMA representatives met with EPA to coordinate our 1983 survey with EPA's ongoing activities. e SUPERFUND FUNDING LEVELS POSITION - The EMC'a Superfund Task Group, In conjunction with the GRC's Superfund Task Group, has developed a reconraended position of the necessary funding level to effectively managethe Superfund program. The anelysla indicates an annual need in tha range of $600 to $800 million par year, which translates to $400 to $600 million par year additional revenues. HAZARDOUS WASTE TRACKING COMPUTER PROGRAM - CMA hss in pises s computer program that will track Suparfund site cleanup activities. Wa are entering EPa's most up-to-datt data and will be incorporating this Information aa an integral part of our Suparfund advocacy activities. DEEPWELL INJECTION EDUCATIONAL BOOKLET - CMA and the EMC'* specially funded Underground Injection Control Work Group have finished the final editorial review of an aducational booklet on deepwell disposal. Tha booklet should be ready for publication and distribution by mid-April. EPA NATIONAL GROUNDWATER STRAIECY - CMA submitted comments to EPA on tha Agency's draft national groundwater strategy. CMA had significant concerns with EPA's failure to consider groundwater quality and quantity aa part of tha draft strategy. a RCRA GROUNDWATER MONITORING - CMA raprasantatlvas participated in an EPAEnvlroomental Tasting and Certification, Inc. (ETC) workshop on tha problems with tha praaant RCRA groundwater monitoring program. Participants vara from industry, stats and local government, EPA, academia, and environmental organizations. CMA 038105 5 INCIDENTAL CHEMICAL EXPOSURE AND PUBLIC HEALTH CRAC's Impact Analysis Task Group is preparing an article detailing the chemical industry's activities to reduce risks to health, safety, and the environment. The article, aimed at both a general audience and chemical industry audience, will explain what the industry does to identify risks, communicate information about them, and reduce them to the extent feasible. The Universities Associated for Research and Education in Pathology (UAREP) continued its study to determine the nature and scope of human health effects associated with waste sites. Arthur Young & Company, the contract manager for the Board of Sponsors, completed an audit of the project at the end of February. The company concluded that the study was behind schedule, but could be completed in a professional and timely manner. Arthur Young & Company will provide its management expertise to UAREP to ensure that the study meets its deadlines. CLEAN WATER ANALYTICAL METHODS - CMA representatives participated in EPA's annual analytical methods priority pollutants seminar on March 28 and 29, 1934, in Norfolk, Virginia. The seminar Is a critical link for advocating modifications to the analytical methods for developing regulations and/or determining compliance under the Clean Water Act. e EFFLUENT GUIDELINES - CMA has entered into four contracts to develop technical data and support materials for submission to EPA on the anticipated revisions to the proposed effluent guidelines for the organic chemicals, plastics, and synthetic fibers Industry. EPA is expected to publish the revisions this summer and issue final regulations in 1985. e NPDES COMPLIANCE POLICY - CMA submitted a letter to EPA expressing our concern with the Agency's express Intent to issue a policy for effluent dischargers who are unable to meet the July 1, 1984, BAT/BCT Clean Water Act deadline. The EPA policy would provide for NPDES permits not to exceed July 1, 1984, accompanied by administrative orders providing a compliance schedule not to exceed July 1, 1987. CLEAN AIR e DISTILLATION NSPS - CMA submitted comments to EPA on March 13, 1984, on proposed new source performance standards for distillation processes. CMA commented on the Agency's continuing failure to allow flares as acceptable controls to comply with the standard. e POM NESHAPS - CMA will submit generic comments on EPA's proposed regulatory strategy for controlling air pollution from polycyclic organic materials. CMA 038106 6 BENZENE NESHAPS RECISSION - CMA is developing detailed comments on EPa's proposed recission of proposed regulations of benzene emission for maleic anhydride, ethylbenzene/styrene, and benzene storage facilities. The Agency's proposed action is based upon extensive data and risk assessments conducted by CMA. OCCUPATIONAL SAFETY AND HEALTH e OSHA HEAD RESIGNS - Thorne Auchter resigned as head of the Occupational Safety and Health Administration effective March 30. Patrick Tyson, deputy administrator, will serve as acting administrator until a permanent agency head is named. Agency policies are expected to remain unchanged for a while. e OSHA REVOKED ABOUT 150 UNNECESSARY, UNENFORCEABLE PROVISIONS OF ITS STANDARDS -- OSHA announced in 49 FR 5318, February 10, 1984, chat it revoked 153 unnecessary standards. Including 149 advisory provisions that were legally unenforceable. The agency amended Its regulations to make clear that only mandatory provisions of standards incorporated by reference are adopted as OSHA standards. OSHA originally adopted many of these provisions from Industry consensus standards developed by the American National Standards Institute and the National Fire Protection Association. They were Intended to be recommendations and, therefore, used the word "should" or other advisory language Instead of a mandatory "shall." OSHA's past efforts to enforce nonmandatory standards have been unsuccessful. Former Assistant Secretary of Labor, Thorne G. Auchter, said the deletions would streamline and clarify the agency's regulations without reducing worker protection. In taking this action, the agency Implemented a number of CMA recommendatlona. WORKER EDUCATION AMD TRAINING SYMPOSIA - Following a survey of CMA members on techniques used In their companies, the OSH Conaittee Is sponsoring a series of symposia on worker education and training. They will be open to both CMA members and nonmembers, and will Include information on worker education and training under the new OSHA Hazards Communication Standard, Dates and places are: April 24. 1984 June 14, 1984 September 25, 1984 Houston, TX Philadelphia, PA San Francisco, CA o SINGLE* AND MULTI-GENERATION REPRODUCTIVE TOXICITY STUDY - The Reproductive Hazards Work Group contracted with Argus Research Laboratories to evaluate single- and multi-generation animal reproductive toxicity studies. Currently, the contractor is reviewing published literature. The work group is conducting a telephone campaign t encourage member companies to contribute unpublished data for this review. CMA 038107 OCCUPATIONAL INJURY AND ILLNESS REPORTING (OIIR) - Fourth quarter 1983 OIIR participation graw 422 in response to the Safety Statistics Work Group's telephone campaign. Approximately 601 of CMA's member companies submitted fourth quarter data. WOBURN HEALTH STUDY - On February 7, 1984, the Harvard School of Public Health Department of Biostatistics and F.A.C.E. (For a Cleaner Environment) released an epidemiologic study of Woburn, Massachusetts. The study examined the relationship of contaminated well water to reproductive and childhood disorders among residents of Woburn. Although the authors reported a statistically significant association between exposure to contaminated wells and childhood leukemia, prenatal deaths, and certain birth defects and childhood illnesses, serious flaws in the study preclude acceptance of these findings. Some limitations include: (l) the use of nonrandom samples, (2) interviewer prior knowledge of addresses of respondents and therefore the probability of exposure, (3) the use of unvalidated interview responses, (4) the application of cross-sectional exposure data to the entire study period, (5) failure to include data on prenatal exposures and (6} biological plausibility between exposure and outcomes was not established. U.S. CANCER MORTALITY RATES AND TRENDS - NCI and EPA published tables of age-standardized cancer mortality races by county for the periods 1950-1959, 1960-1969, 1970-1979. These races cannot be used for hypothesis testing but should be useful for Identifying populations to be studied in the search for causes of cancer. SAFE AND COST-EFFECTIVE CHEMICAL PRODUCTS DISTRIBUTION EMERGENCY RESPONSE TRAINING - On February 16 and 17, 1984, CHEHTREC sponsored an Emergency Response Team Workshop in Houston, Texas. There were 54 attendees from the chemical and carrier industries. The next workshop will be held in St. Louis, Missouri on May 9 and 10. TRAINING AIDS - The Emergency Response Work Croup is planning to develop a library of training aids for emergency response personnel. Their first cask will be to identify and critique existing training aids that have been developed by the companies that are members of the group. CHEHTREC/DISTRIBUTION NEWSLETTER - The first combined CHEMTREC/Diatribution Newsletter was mailed on March 1. Industry reaction has been very good. Special interest was shown in Highway Carrier Safety Profile and we have sent several copies out for member company use. REGULATIONS ROUTING RESTRICTIONS - The Distribution Committee adopted the Materials Transportation Bureau's hazardous materials routing restrictions as a key issue. We will coordinate with highway interests before we actually petition for a rule. RAIL SAFETY - The Department of Transportation, Materials Transportation Bureau, issued HM 175 and amended HM 174 to require head shields. Improved CMA 038108 8 insulation and largar valves on certain pressure tank cars used in flammable gas and ethylene oxide service. e VINYL CHLORIDE RESTRICTIONS - The Materials Transportation Bureau has requested industry's input on preemption proceedings in Framingham, Mass. Framingham has attempted to impose extensive restrictions on the temporary storage of tank cars containing vinyl chloride. The Distribution Committee is considering the matter to determine the correct response. e NEW HAZARDOUS MATERIALS RULES - Transport Canada has proposed new rules for hazardous materials which would require registration of shippers, records on employees, information on products shipped and packings used. Comments are due by April 19. e NATIONAL TRANSPORTATION BOARD COLOR CODING FOR RAIL CARS - NTSB has again asked CMA to develop a recommendation regarding color coding of rail tank cars, tfe plan to meet with NTSB and the rail car leasing representatives to discuss a solution. SAFETY RELIEF VALVES - NTSB will address safety relief valves In the near future and is expected to ask CMA's assistance in correcting the problem with "improperly Installed or non-functioning valves". e MARPOLII - The Coast Guard has proposed a modification of MARPOL Annex II which would make compliance easy for ship owners and reduce the need for ' reception facilities. The Marine Technical Vork Group has reviewed this proposal and believes it would be acceptable. e MARINE POLLUTION - Ve are working with the Coast Guard on the IMO convention regarding marine pollution. The Coast Guard continues to believe that they should cooperate on developing a convention but influence the terms to be more acceptable to U.S. Industry. CMA and member companies oppose a convention. TANK CAR COMPENSATION - CMA unsuccessfully protested before the ICC a cap on tank car mileage compensation for cars used in clay service because of its Impact on the Ex Parte 328 car compensation negotiations. Ve have appealed to the ICC. ENERGY AND FEEDSTOCK SUPPLIES ENERGY TAXES - SRI International has been selected to study the affects of an energy tax on the competitive position of U.S. producers in selected chemical markets. The study, expected to be completed In May, might highlight soma detrimental effects of new Superfund taxes. ENERGY CONSERVATION - CMA has appealed the decision of the American Society of Heating, Refrigerating, and Air-conditioning Engineers (ASHRAE) which approved an energy conservation standard for existing Industrial buildings. CMA is concerned that the standards will be adopted by certain states and other regulatory bodies as mandatory requirements for Industry. The standard requires energy audits, engineering studies, and building CMA 038109 9 conservation measures that could be costly. CMA urges ASHRAE to Issue the 100.4P standard as a technical guide so that chemical industry management will not have resources diverted arbitrarily from the most cost-effective opportunities. CMA is also urging members to communicate their concerns to the ASHRAE President and Board of Directors. e NEW PLANT ENERGY USE SURVEY - The Energy Information Administration is requesting public comment on a proposed new survey of industrial energy consumption. They maintain that the information is necessary for understanding and describing energy consumption, and to provide input to the analysis of proposed energy policies. NATIONAL CODES AND STANDARDS VOLUNTARY STANDARDS - CMA is preparing ballots on 19 American National Standards: UL 44 (Rubber-Insulated Vires and Cables), UL 50 (Cabinets and Boxes), UL 62 (Flexible Cord and Fixture Wire), UL 83 (Thermoplastic-Insulated Vires and Cables), UL 674 (Electrical Motors and Generators for Use in Hazardous Locations), UL 781 (Portable Electric Lighting Units for Use In Hazardous Locations), UL 823 (Electric Heaters for Use In Hazardous Locations), UL 844 (Electric Lighting Fixtures for Use in Hazardous Locations), UL 845 (Motor Control Centers), UL 1581 (Reference Standard for Electrical Vires, Cables, and Flexible Cords), NEMA TC2 (Electrical Plastic Tubing and Conduit), NEMA TC5 (Corrugated Polyolefin Coilable Plastic Utilities Duct), NEMA TC6 (PVC and ABS Plastic Utility Duct for Underground Installation), NEMA TC7 (Smooth-Wall Coilable Polyethylene Electrical Plastic Duct), NEMA TC8 (Extra-Strength PVC Plastic Communications Duct and Pittlngs for Underground Installation), and NEMA TCI3 (Electrical Non-Mctalllc Tubing). e CHANCES OF CMA REPRESENTATIVES ON STANDARDS ORGANIZATIONS - CMA named V. L. Stuart of Dow as principal CMA representative on the ANSI Piping and Process Equipment Standards Board, C.J. Erickson of Du Pont as CMA representative to American National Standards Committee C50 (Rotating Electrical Machinery), and repeated a request for extending voting privileges for CMA representatives to Code-Making Panel No. 12 of the National Electrical Code Committee. e CMA ACTIONS ON VOLUNTARY STANDARDS - CMA representatives approved Instrument Society of America representation on: -- the ANSI Electrical and Electronics Standards Board, extension of five overage standards under EESB jurisdiction; -- approved formation of a Joint Telecommunications Standards Coordinating Committee consisting of representatives of the ANSI Information Systems and Electrical and Electronics Standards Boards; and. CMA 038110 10 -- approved establishment of a Photovolcaics Coordinating Committee under EESB. e TECHNOLOGY APPLICATIONS - The final program for the Fourth CMA Process Computer Forum was mailed to the membership on March 7, 1984. CMA EC - 4/3/84 BO - 4/3/84 CMA 038111 EXHIBIT 0 REPORT OF THE DIRECTOR OF COMMUNICATIONS JON C. HOLTZMAN CLEAN AIR - Radio newsfeeds on clean air were produced and distributed to CMA's 2400 station network. *- CLEAN WATER - The news bureau continued coordination of Citizens for Effective Environmental Action Now (CEEAN) which included preparation of a follow-up mailgram to selected CEEAN supporters to initiate further contact with members of Congress on BAT modification. CEEAN communication activities were initiated on pretreatment issues. Broadcast services produced and distributed four radio and two television newsfeeds on clean water issues. WASTE HANDLING AND DISPOSAL - Report of Superfund testimony dominated our activi ties. We coordinated media activities related to testimony by Dr. Fernandez on Superfund reauthorization. Developed targeted communications plan for Superfund reauthorization-hazardous waste issues. This will involve intense media activity around the country. Assisted in "hot box" preparation of witnesses for testimony. We also began production of television and radio materials on Superfund issues for distribution to states targeted in CMA's advocacy planning. We also conducted 12 media tours on this issue; produced and distributed six radio and one television newsfeeds on the issue; developed and distributed press release/handled media inquiries on CMA waste-end tax testimony; responded to media inquiries on Florio Superfund proposal; conducted research on media and issues in target states for Superfund communication efforts; and continued identification of major speaking platforms for appearances by Board members. CMA will be shooting film footage at four or five waste sites on EPA's National Priority List. The purpose: to document waste clean-up activities for use in a documentary film and newsfnatures. CMA NEWS continues its in-depth special reports on timely issues. Recent reports have focused on waste management practices in the industry, risk assessmentrisk management, right-to-know, and will cover Superfund testimony. COMMERCIAL PRODOCTION OF CHEMICALS - The news bureau developed and distributed materials (news release, background paper, talking points) and responded to press inquiries on CMA benzene health effects study. The broadcast section developed and distributed radio newsfeatures on related issues including product testing and safety, TSCA reauthorization and new technology. We also produced and distributed second "Lifestyles" radio program series (14 programs) on consumer issues related to commercial use of chemicals. Distribution expanded to 1,400 stations nationwide (from 1,200). We are achieving 80% usage according to station reports. PUBLIC COMPENSATION - The New Jersey Chemical Industry Council is studying a state-wide targeted communications program concerning a state public compensa tion bill and will seek CMA support. CMA 038112 TRADE AND TAXATION - The annual economic briefing by Myron Foveaux was conducted for the press. Press materials on CMA's annual economic survey/foreeast were produced and distributed at the briefing and afterwards. Radio newsfeeds on economic/trade-taxation, maritime legislation and inter national trade and export issues were produced and distributed. TRANSFORTATION - The following activities were conducted on this issue: coordi nation of activities related to the Hazardous Materials Spills Conference in Nashville April 9-11; development of general information presentation on CHEMTREC; development of media training program for CHEMTREC workshops; conducted two media tours on transportation/CHEMTREC issues; production and distribution of two radio newsfeeds on transportation issues. ENERGY AND FEEDSTOCK SUPPLIES - The broadcast service produced and distributed four radio and four television newsfeeds on energy issues, including natural gas decontrol. REGIONAL COMMUNICATIONS - The Louisiana Chemical Association's final drive to interview 100 media persons should be reached by the end of February. A survey will then be taken to determine if the "blitz" by LCA has changed the attitudes of the media towards LCA and the chemical industry in the state. We are supporting the Texas Chemical Council's targeted communications program dealing with hazardous waste management and siting. A multi-media program is aimed at the media, communities and employees. On completion, TCC will write a a report describing the program and how it can be adapted for use by other Chemical Industry Councils. The department is working closely with task groups of the Environmental Manage ment Committee to develop publications dealing with alternatives to land disposal of hazardous waste and with case studies of hazardous waste disposal. GENERAL COMMUNICATIONS - The CMA Issues Briefing Book has received wide distribu tion (nearly 1200 copies) and favorable response. Many member companies are duplicating and distributing books throughout their organizations. In the mail: a "yellow pages" section for the back of the book featuring background and CMA position on 20 emerging issues. Two new CMA ads are running in the media trade press from February through June 1984. Included in the schedule are Editor 6 Publisher, Columbia Journalism Review, Broadcasting. The objectives; (1) to let the media know that we want to openly discuss the issues; (2) to encourage media to look to CMA as an information source. A targeted, low-cost effort. CMA is completing a booklet that substantiates how member companies have historically worked throughout the Association to adhere to the CMA State ment of Principles on Health, Safety and Environmental Quality. CMA 038113 -3- CATALY5T - The judges have chosen the 18 catalyst Award Winners for 1984. cma received 157 nominations in this year's competition. Results will be made public on April 2. Early returns on CMA's Catalyst/Science Education television public service announcements: 60 stations report 1,037 telecasts. Excellent response to school give-away program for back inventory of CMA audiovisual materials shows 63 schools ordering 155 free films, videotapes and slide presen tations . The CONSUMER INFORMATION section is printing a new catalogue of communications materials available from CMA. Preparations are underway for activities with th National Science Teachers Association and other consumer groups. Contact has also been made with the General Federation of Women's Clubs to use their platforms for our issues. The department developed a script for videotape presentation to explain clean Sites, Inc, to concerned audiences. EMPLOYEE COMMUNICATION A recently completed survey prepared by and sent out under the auspices of the Communications Committee, determined that many employee communications editors do not receive or do not use CMA's issue-oriented materials. Steps are being taken to increase the flow of such materials to employee communications editors in formats that will make them more appealing and more usable. CMA EC-4/3/84 CMA 038114 REPORT OF THE DIRECTOR OF GOVERNMENT RELATIONS WILLIAM M. STOVER EXHIBIT P NATIONAL ECONOMIC POLICIESi CMA URGES STATUTORY MORATORIUM ON APPLICATION OF RESEARCH AND DEVELOPMENT TAX REGULATIONS Treasury Regulations 1.861-8 require U.S. corporations, for Federal income tax purposes, to allocate a portion of research and development expenses incurred in this country to foreign source income. The impact of this allocation is to reduce the extent these companies can deduct these expenses currently and to increase their U.S. income taxes significantly. The Economic Recovery Tax Act of 1981 suspended enforcement of these regulations for a two-year period which expired in December, 1963. On March 13, 1984, the Senate Finance Committee approved a 2-year extension of the statutory moratorium. In November, 1983, CMA testified before the Subcommittee on Oversight of the House Coomittee on Ways and Means in favor of legis lation to extend the statutory moratorium or to make the moratorium permanent. The impact of these regulations would be injurious to the U.S. chemical industry that exports a significant portion of its products and conducts much of its research and development activities in the United States. It is estimated that the current annual impact of these regulations on the chemical industry would exceed $300 million. . CMA is an active member of the business coalition that is seeking passage of legislation to extend the statutory moratorium on the application of the Regulations. The coalition is supporting a 2-year extension of the statutory moratorium in the Senate deficit reductions tax package. It is anticipated that this legislation will be the subject of a House-Senate conference beginning in mid-April. NATIONAL ECONOMIC POLICIESt DOMESTIC INTERNATIONAL SALES CORPORATIONS (DISC) The Senate Finance Committee has agresd to includs S. 1804 (Dols, R-KS), tha Administration's Foreign Sales Corporation (FSC) alternative to DISC in the deficit reduction tax package that will be considered by the Senate later this month. In including the FSC legislation, the Finance Committee responded to s strong, coordinatsd initiative of the Administration and the Washington business legislative community. The FSC legislation was dsveloped by the Administration to provide a GATT legal alternative to DISC. The failure of the United States to replace the DISC provisions of tha Internal Revenue Code could subject U.S. exports to import restrictions in Europe and other GATT countries. CMA 038115 -2- Tha DISC provisions are particularly important to tha chamical industry. It is estimated that the amount of annual tax deferrals under DISC in the chemical industry is over $300 million. Moreover, the total amount deferred by the chemical industry since DISC was enacted in 1971 is estimated to be over $2.5 billion. CMA is actively working in the coordinated legislative effort of the Washington business community to enact FSC in the present Congress. On Monday, March 19, CMA will host a luncheon briefing on the provisions of the Administration's FSC bill for staff numbers of Members of the House ways and Means Committee. It is anticipated that Senate Finance amendments on this subject will be added to a House-passed bill that may be considered by a House-Senate conference in mid-April. NATIONAL ECONOMIC POLICIESt SENATE FINANCE REVERSES TREASURY REGULATIONS ON HYDROCARBONS USED IN GASOLINE The Senate Finance Coamiittee has approved a technical correction amendment that would specifically exempt light hydrocarbon used in gasoline from separate taxation as chemicals under the Superfund excise taxes. The Senate Finance amendment which was adopted as a part of its deficit reduction tax package, would reverse the effect of an interpretation of the Superfund excise tax law that was proposed by the Treasury last fall. ENERGY AND FEEDSTOCK SUPPLIESt NATURAL GAS PROPOSALS Twelve Senators who represent a cross-section of the Senate's differing views on how to deal with the natural gas issue have met in closed-door sessions to discuss the components of a bill. They are considering a compromise proposal proffered by Senate Energy Committee Chairman James A. McClure (R-ID) close to a consensus version developed at the close of the last session of Congress. While-the effort of the group is focused on a comprehensive approach to natural gas legislation, there is consideration of a much "shorter" bill. This bill would likely cap indefinite-priceescalator clauses in contracts and repeal the Power Plant and Industrial Fuel Use Act (FUA) and incremental pricing provisions and recontrol authority in the Natural Gas Policy Act (NGPA). It may not address take-or-pay reductions by pipelines, deregulation of gas prices or contract carriage, leaving those issues to the Federal Energy Regulatory Commission or current law. An even more limited bill nay be introduced by Senator Howard Metzenbaum (D--OH), an opponent of gas decontrol who is not involved in the compromise talks. His version would simply limit indefinite price escalators and repeal the FUA and NGPA incremental-pricing policy. CMA 038116 3- The highly controversial nature of the issue may preclude enactment in this election year of a compromise bill, given the increasing temptation to do as little as possible or address only consensus items. The negotiation process has reached a point where the industrial sectors are very close to their "bottom lines." Some of them would now prefer the status quo rather than have legislation that may not serve their interests. It appears that the Administration remains supportive of the process underway, yet not committed to actively push for legislation in this session of Congress. Certain high-impacted interstate pipelines have offered a comprehensive proposal in an effort to gain producer and user coalition consensus. CMA is participating in discussions underway on a working consensus document. Coalition effort has primarily been concentrated in the Senate because action there will trigger activity in the House. It has, however, become 'apparent that the House could act if a "short bill" gains momentum. A stalemate exists presently in the House Energy and Commerce Committee, where a compromise bill has the majority of votes but not the support of Chairman John D. Dingell (D-MI-15). NATIONAL ECONOMIC POLICIES; TRACE REMEDIES The Trade Remedies Reform Act of 1984 (H.R. 4784), which was introduced by Representative Sam Gibbons (D-FL-7) on February 8, was reported to the ways and Means Committee on February 29. The bill establishes, along with other important remedy measures, the authority to impose countervailing duties against imported material manufactured from raw materials which have multi-tiered prices. The bill also establishes a mechanism to deal with industry targeting by foreign governments. Additional Committee action has not yet been scheduled for the bill. There is no comparable bill in the Senate. While H.R. 4784 contains many other provisions which modify existing countervailing duty and antidumping laws, none are as controversial as those mentioned above, CMA member companies are already actively lobbying the Congress directly on both sides of the issue. Accordingly, the CMA Executive Committee decided at its March 6 meeting to take no position on the Gibbons bill. The CMA International Trade Committee's import Policy Task Group continues to explore possible revisions to the trade reswdy lavs which would have a broader CMA consensus than does H.R. 4784. Congressional staff assures CMA that they too are open to alternate suggestions which would be agreeable to the broadest possible U.5. business constituency. CMA 038117 -4- NATICNAL ECONOMIC POLICY; U.S./CANADA FREE TRADE AGREEMENT The Canadian chemical industry plans to use its large natural gas deposits in Alberta to produce petrochemicals, world-scale plants and export markets are essential to the success of this effort. The United States is the best and most logical market. Duty-free access to this market is, therefore, extremely important to the Canadians. A thorough report has been issued by the Canadian petrochemical industry and distributed to the CMA International Trade Committee (ITC) for study. The Canadian government is seeking negotiations with the United States for a free trade arrangement in six industrial sectors, including petrochemicals. The Trade Policy Committee of the Canadian Chemical Producers' Association (CCPA) has held a meeting with the CMA ITC and representatives of SOCMA and SPI to discuss such an agreement. It is clearly understood that actual negotiations toward a free trade arrangement will be.carried out by the respective governments. A second meeting of CMA and CCPA and representatives of SOCMA, SPI and NACA is now planned for Tuesday, April 17 in Toronto, Canada. The agenda includes naming of the petrochemicals requested by the Canadians to be in the free trade category. The ITC and its task groups are considering the possible effects of such an.agreement with Canada. Ultimately, a policy recommendation will be made by the ITC to the CMA Board. NATIONAL ECONOMIC POLICYi U.S./ISRAEL FREE TRADE AGREEMENT The U.S. and Israel announced last Fall their intentions to establish a free trade area between the two nations. Although no legislation establishing such an agreement has been released by either the Administration or the Congress, it is believed that the Administration favors a rapid ratification and implementation. The U.S. International Trade Commission (USITC) is examining the probable economic insets of such an agreement with Investigation 332-180 which will conclude on May 30, 1984. In 1993, Israel imported chemicals into the United States valued at $132.8 million. Of these, $53.5 million were imported duty-free because the items in question have a zero percentage rate of duty. An additional $72.6 million of chemicals entered duty-free because the items in question were covered by the Generalized System of Preferences (GSP). The remaining $6.7 million of chemicals imported from Israel were charged varying rates of duty, while it appears that the vast majority of chemicals already come in from Israel duty-free, 54.7 percent of these imports entered the U.S. under the GSP program which expires in January, 1985. CMA 038118 -5- The CMA International Trade Committee is currently preparing a proposed CMA position for consideration by the Executive Committee, NATIONAL ECONOMIC POLICY; EEC RETALIATION In retaliation for the U.S. import quotas on EEC specialty steel imports, the EEC has imposed a combination of quotas and duty surcharges on select U.S. exports, including certain petro chemicals. Because discrepancies existed between the EEC and U.S. data with regard to exchange rates and trade statistics, the United States requested an emergency meeting of the General Agreement on Tariffs and Trade (GATT) in an attempt to modify the EEC retaliation. while the EEC refused to rescind its action which went into effect on March 1, it did agree to modify the terms of the retaliation as follows: 1. Because the European currency unit has dsclined in value relative to the U.S. dollar, the EEC agreed to raise the quota level on styrene and polyethylene sheet by 20 percent. 2. The EEC will continue to resolve the discrepancies in U.S. and EEC trade data. (The U.S. data shows a much greater quantity of styrene and vinyl acetate monomer being shipped than the EEC data show being received.) If the U.S. data are shown to be correct, the EEC will further modify its action. 3. The intent of the EEC action is to reduce trade in the affected commodities, but not to eliminate it. If U.S. exports to the EEC of methyl alcohol, vinyl acetate monosMr, styrene or polyethylene are reduced to zero, the EEC will reconsider its action. CMA has alerted member companies of the new tariffs and quotas on each affected product. The Trade Representative's office has been given extensive help in assessing the economic impact. Unofficially, CMA has protested the unfairness of the EEC retslistion. CMA 038119 FRODUCT DISTRIBUTION; PRESIDENTIAL SIGNING OF MARITIME BILL EXPECTED. The House approved on March 6 by voice vote legislation to replace the longstanding U.S. regulatory system over ocean common carriers. The Shipping Act of 1984 (S. 47), already cleared by the Senate, now goes to the President for his expected signature to make it law. The bill is viewed as an important first step in helping to revitalize the u.s. merchant marine. The compromise legislation reflects a balancing of shipper and carrier interests and includes some of the most far-reaching reform language since enactment of the 1916 Shipping Act. The effort represents a culmination of years of Congressional attempts to modernize the nation's maritime regulatory statutes. Four sessions of Congress have taken up the issue with bills being reported out of eleven committees. Differing House and Senate versions were reconciled after the Judiciary Committee injected into the process a form of competitive standards for judging whether carrier conference rate agreestents would be given antitrust immunity. The policy stated is to assure minimal government intervention in a nondiscriminatory regulatory process and promote an efficient and economic U.S. liner fleet system that is as consistent as possible with the international shipping practices of our trading partners. In support of maritime legislation CMA has on numerous occasions presented testimony and provided written comment on matters of importance to the chemical industry. Many of the CMA suggestions to enhance the competitive ability of U.S. exporters have been incorporated in the final version. FRODUCT DISTRIBUTION HAZARDOUS MATERIALS UNIFORMITY LEGISLATIOH A con^rahensive safety bill which deals with hazardous materials transportation has been the subject of hearings in the Subcommittee on Surface Transportation of the Senate Commerce, Science and Transportation Committee. Xf hazardous materials transportation issues are considered further. Chairman John C. Danforth (R-MO) may introduce a separate proposal that couples the provisions of that bill to amend the Hazardous Materials Transportation Act (HMTA) with the positions of a coalition representing public and private sector interests. Any likely measure is expected to encourage uniformity of CMA 038120 -7- federal, state and local hazardous materials regulation, and seek improved emergency response, coordination and enforcement. Unlike the coalition bill, the proposal may seek general revenue support and require a study of the concept of an industry funding mechanism. Similar safety legislation has been offered in the House Pulbic works and Transportation Subcommittee on Surface Transportation by Representative Tom Lantos (D-CA-11). Hearings were held February 28, 29 and March 1 and a coalition panel of shipper, carrier, state and local representatives presented testimony on the hazardous materials transportation aspects. Substantial progress has been made by the coalition to reach a consensus agreement on the need for federal uniform hazardous materials legislation, yet differences of opinion do exist. CMA review of the coalition's legislative proposal focuses on the funding mechanism and the preemption of state and local fees. Our views have been conveyed to the Hill and filed for the House hearing record. No further Congressional activity has been scheduled, but the reauthorization of the HMTA may provide a vehicle for debate on the issue later in the year. PRODUCT DISTRIBUTION: CONGRESSIONAL ACTION ON RAILROAD DEREGULATION SOUGHT Senator John C. Danforth (R-MO) is circulating draft language for a Joint Resolution that would deal with how the Interstate Commerce Commission (ICC) is implementing the Staggers Rail Act of 1980. The Joint Resolution would have the effect of law if passed by Congress and signed by the President. Issue areas under discussion include the revenue adequacy of railroads, market dominance and pro-competitive features. Final wording has not been agreed upon. Concern has been expressed that the ICC has disregarded provisions in the Rail Act that provide consumer and shipper protection. Captive traffic has been particularly impacted by the monopolistic power of the railroads. Oversight hearings have been held before the Surface Trans portation Subcommittee of the Senate Commerce, Science and Trans portation Committee, and by the Subcommittee on Commerce, Trans portation and Tourism of the House Energy and Commerce Conmittee. Legislative hearings may be scheduled on bills that have been introduced as well as the Joint Congressional Resolution. CMA 038121 -8 CMA is urging that specific pro-competitive language should be added to existing law or that a Joint Resolution be passed directing the ICC to comply with Congressional intent. CMA position papers and draft language has been submitted to the appropriate Congressional staff and the effort is underway to meet with coalitions among the aluminum, coal, chemical and utility industries. Public sector groups are also meeting to express concern over railroad rates and seek Congressional review of ICC procedures. COMMERCIAL PRODUCTION Of CHEMICALS; TSCA In the House, Chairman James Florio (D-NJ) has been preoccupied with Superfund reauthorization and has not been able to devote time to his TSCA amendments package, H.R. 4304. CMA, nonetheless, has been working to develop positions in response to Mr. Florio's bill, and has had preliminary meetings with majority and minority staff of the Florio Subconmittee. Regarding the minimum/tiered testing proposals, CMA remains opposed to a fixed battery of premanufacture testing on an inflexible basis. Nevertheless, because of the perception in certain sectors- of the Congress and the public about the adequacy of the data included in the PMN process, we are exploring ways of providing greater assurances as to the adequacy of the process. Regarding the proposed confidentiality changes, we believe the 90 day PMN review period should not be suspended while confidentiality disputes are resolved. Other provisions in the bill are being reviewed for the purpose of determining their objectives and CMA's positions. In the Senate, the majority staff of Chairman David Durenberger's Subcommittee is working on a draft options paper including possible amendments to TSCA. Four main areas have been identified as follows; o an unwieldy section 4 test rule process; o inadequacy of PMN data; o excessive confidentiality claims; and o inadequate use of section 6 control actions on existing chemicals. CMA is working with other trade associations to address these concerns and develop positions which can be constructively used at the appropriate time to help shape the outcome of Senate efforts to amend TSCA. CMA 038122 -9- OCCUPATIONAL SAFETY AND HEALTH: THE MILLER BILL In the House, Chairman George Miller (D-CA) has been unable to develop compromise language sufficient to attract consensus support for his occupational disease bill, H.R. 3175. In the Senate, Chairman Don Nickles (D-OK) continues to await House floor action on the Longshore Act amendments before he schedules hearings on occupational disease compensation. Senator Edward Kennedy's (D-MASS) staff is said to be drafting a broad occupational disease compensation measure, the first part of which would deal with specific substances such as asbestos, and the second part would embody a generic approach to workplace diseases. Details as to substance of the draft and when it will be introduced are unavailable. OLD WASTE SITES/CERCLA Representative James Florio (D-NJ) has completed hearings on Superfund reauthorisation in his Subcommittee on Commerce, Transportation and Tourism. He will try to begin markup of H.R. 4813 the week of March 19, but only if he can solve some of the political concerns of his subcommittee members. Three Democratic members have substantial concerns with the funding aspects of H.R. 4813. Even if Florio solves these concerns, he will still have to resolve such issues as liability and coaqpensation. At this time no data has been set by Florio to begin markup, CMA continues to express its strong opposition to the funding levels and mechanissis in Representative Florio's and Representative Lent's bills. CMA is also aggressively opposing other issues in the legislation such as joint and several liability and "victims" compensation. Dr. Louis Fernandes, Monsanto Company, testified before Florio's subcommittee on March 8 for CMA. He stressed the need for epa, Congress and industry to study the dumpsite data to arrive at what can be reasonably cleaned up in a year and how much money would EPA be able to spend in a year. Dr. Fernandez also discussed, in response to questions, the Entity, liability, post closure and "victims" condensation. EPA Administrator Ruekelshaus testified March 15 and asked Florio to wait on Superfund reauthorization until EPA completes, by the end of 1984, the Congressionally mandated study on funding mechanisms and levels. Ruekelshaus said that the compensation issue should be addressed separately and Congress should look at this issue more broadly than just exposure to dumpsites. The media has not been reporting regularly or aggressively on Florio*s bill or the superfund hearings. CMA 038123 -10- CMA has underway an aggressive education and lobbying effort in Washington, D.C. and in hey Congressional Oistricts. We also are meeting regularly with other industry groups that are interested in the Florio legislation. SAFE DISPOSAL/RESOURCE CONSERVATION AND RECOVERY ACT (RCRA) AMENDMENTS At the end of its 1983 session, the House passed H.R. 2867, a bill to amend the Resource Conservation and Recovery Act. The Senate version of this bill S. 757 is ready for consideration by the full Senate. However, the press of other legislation and issues has caused its consideration to be delayed a number of times. CMA is in the process of reviewing draft language prepared by the staff of the senate Environment and Public Works Cosnittee on minimum technological requirements for existing surface impoundments. This language would require surface impoundments in interim status to be brought into compliance with a double liner standard four years after the enactment of the bill. However, surface impoundments which currently have at least one intact liner and are not located in areas of vulnerable hydrogeology would be exempted from the double liner requirement. t The Conmittee draft amendment is still unacceptable to CMA. Efforts are underway by CMA to ensure that surface isqpoundments which are part of a NPDES system are exempt as a class of impoundments in the Senate amendment. Furthermore, CMA is trying to incorporate a reasonable environmental test into the exemption of all other surface impoundments. While there are a number of other provisions contained in S. 757 and H.R. 2867 which CMA has cause to be concerned with, it does not appear likely that any amendments will be offered on the Senate floor to improve those provisions. It ie now anticipated that the Senate will consider S. 757 sometime in early April. CLEAN WATER ACT The Senate is expected to debate Clean Water Act Amendments later this spring. The floor debate will cover S. 431, the comprehensive bill sponsored by Senator John Chafee (R-RI) and S. 2006, a bill to assure that states develop programs to reduce non-point sources of pollution. CMA does not support the Chafee bill as it stands, since its only relief is the compliance deadlines. CMA is working to have included a local pretreatment program under the Clean water Act. CMA supports the pretreatment amendment which Senator Steven Symma (R-XD) plans to CMA 038124 u offer. CMA is participating in a pretreatrtent coalition of public and private sector interests which is working to have Democratic co-sponsors support Symms. In the House, there is the opportunity to achieve a better local pretreatment amendment. Congressman Robert Roe (D-NJ), chairman of the Subcommittee on Water Resources, has begun drafting clean water amendments which he plans to be considering by the summer. CMA is communicating with House members about constructive local pretreatment, compliance deadline extensions and BAT modifications. SAFE DRINKING WATER ACT (SWDA) Congressman Henry Waxman's (D-CA) Subcommittee has completed hearings on the Safe Drinking Water Act (SWDA) amendments which were introduced by Congressman Eckart. It is apparent that Congressman Waxman has decided not to move forward with tha markup on Congressman Eckart's bill, H.R. 3200, until he is able to obtain a better under standing of the issues considered most important to the environmental community. It would appear, therefore, that the earlier efforts to obtain a compromise version of H.R. 3200 on which the majority and minority Members of the Energy and Commerce Committee could agree have been unsuccessful. Major areas of disagreement between the various parties interested in H.R. 3200 continue to be the definition of an underground drinking water source.' Additional areas of disagraement are the possible amendment to include sole source aquifers and the provision to require EPA to regulate all nonhazardous surface impoundments. The differences between the various interested parties on standard setting provisions do not seem insurmountable. It Is unclear at this point what type of support there is in the House for movement on a safe Drinking Water Act amendment this year. Senator Durenberger, Chairman of the Toxic Substances and Oversight Subcommittee of Senate Environment and Public Works Committee, may introduce a Safe Drinking Water Act amendments bill within the next few weeks. His Subcommittse is scheduled to begin hearings on possible legislation March 22nd. It is unclaar at this point what Senator Duranbarger's bill will contain, ainca no draft language has been made available. CMA 038125 12 CLEAN AIR ACT On March 13, the Senate Environment and Public Works Committee approved by sixteen to two S. 768, the comprehensive package of Clean Air Act amendments. The bill will be ready for Senate floor consideration once the Committee issues a report. CMA is a major participant in the industry coalition developing floor strategy. The major amendment added to S. 768 in the Committee was a worsening of the acid rain provisions, to require 10 million tons reduction of S02 over ten years in 31 Eastern states. This amendment caused Ranking Minority Member Jennings Randolph (0-WVA) to vote against the bill as amended. The other dissenting vote was that of Senator Steven Syoma (R-ID), who has expressed concern about several provisions of the bill including the amendment of Section 112 regarding hazardous air pollutants. Senator Max Baucus (D-MT) offered a far reaching amendment to Section 112 which was not approved. CMA's Clean Air Act Task Group and other industry representatives contacted the members of the Committee to defeat Baucus. But, S. 768 still contains amendments to Section 112 which CMA opposes. In the House, there still is no comprehensive clean air bill, but Representative Tom Wirth (D-CO) has introduced a bill that would adversely amend Section 112 of the Clean Air Act. H.R. 5084 includesi o Automatic listing if EPA does not make determinations whether substances are hazardous air pollutants by deadlines o Stringent, complex system of emission standards and interim emission standards o Permits for all new, modified and existing sources o Controls for emissions from motor vehicles. Hearings are slated to begin late March in the House Health and the Environment Subcommittee. CMA will request to testify regarding possible Clean Air Act amendments including the proposed Wirth bill. CMA 038126 13- STATE LEVEL COMMUNICATION AND COORDINATION STATE LEGISLATIVE ACTIVITY Legislative activity for 1984 will peak during the next three months. A number of the smaller states such as Virginia, Indiana, Maryland, Georgia and West Virginia have already concluded their sessions. Several other important states to the chemical industry, including Louisiana, are beginning their sesssions in April. The Louisiana legislature is also meeting in special session during the last week of March to consider a 750 million to one billion dollar tax increase which could have a significant impact on the business climate in the state. Overall, the budget situations in most states have improved dramatically over the near crisis conditions of the last several years. With states having moved! to get their financial houses in order, the most important federal issues for the Governors and state legislators is the federal budget deficit. STATE AFFAIRS COMMITTEE PROGRAMS UNDERWAY NIC Meeting. State Affairs Committee members and staff participated in the National Industrial Council's (NIC) annual meeting of state associations. This group represents the leaders of all the state manufacturers associations which constitute a crucial and integral part of CMA's State Affairs Network. State Affairs staff briefed the participants on recent developments relating to the right to know issue. In addition, CMA cosponsored other elements of the NIC program. A similar effort is planned with the Council of State Chambers of Cossnerce in late April. NCSL. The National Conference of state Legislatures (NCSL) met late in March in Salt Lake City. Two issues discussed with significant implications for the chemical industry were Public Compensation and Groundwater. State Affairs Consulttee members and other chemical industry representatives together with CMA staff, engaged in nationwide grassroots efforts to obtain the best possible NCSL policy on these issues. In addition to organizing the grassroots efforts in key states with individual state legislators, the State Affairs Program also coordinated on the scene lobbying activities in Salt Lake City involving approximately seven member company state affairs professionals. CMA 038127 14- Communications. Interaction between CMA and our state affairs network continues to develop and has resulted in a substantial improvement in the timeliness and content of the division's weekly publication on legislative and regulatory activity, The State Affairs Peport. Members of the SAC Environmental Task Group and EMC Clean Air Act Task Group met with the State Territorial and Air Pollution Programs Administrators (STAFFA) toxics work group to present the industry viewpoint on toxic air regulatory programs at both the federal and state level. CMA representatives were asked to comment on STAFFA's plans for an air toxic clearinghouse to provide information to the states. The CMA position paper on state toxic air pollutants was discussed and distributed to the state air directors. The AIHC State Resources Deployment Task Force recently released their profiles of chemical lists. Many of these lists are considered as a basis for the regulatory programs of state or local units of government. This compilation is currently being reviewed by the Environmental Task Group and will be sent out through CMA's state network. The Hazardous Materials Transportation Task Group is currently coordinating plans for participation in the Hazardous Materials Advisory Council (HMAC) annual conference which will be held in the Washington area in May of this year. The Hazard Communication Task Group, in conjunction with representatives of the OSH committee task groups, is undertaking a long range look at where the right to know issue is heading in the states in 1985 and beyond. As part of this effort, the task group is also considering what strategies, tactics and resources will be appropriate to address this issue as it evolves in the post federal hazard communication standard period. The Hazardous Waste Disposal Task Group continues to focus its major efforts on the public compensation and superfund issues. In preparation for expected major activity in 1985, the group was briefed on and discussed the workers compensation/occupational disease issue. The Information Management Task Group is sponsoring a meeting on March 22 of all participants in the Commerce Clearing House (CCH) group contract with CMA. This meeting will critique the vendor's performance to date in terms of the timeliness and accuracy of its legislative reporting service. The task group will use the results of this meeting as a basis for negotiating the 1985 contract for computer based legislative reporting with CCH or another vendor. CMA 038128 -15- :<2Y ISSUE:__ SUPEAJUND AND HAZARDOUS WASTE A key New Jersey state senator testified in early March at Congressional hearings in support of many of the key features of the Florio Superfund reauthorization bill. The National Governors Association is also expected to provide support for many of the provisions of the bill which impact states. Although we have been able to substantially contain the spread of joint and several liability to state superfunds, considerable activity continues in 1984 on the size of these funds and the revenue sources being used to finance them. A bill is expected shortly in New Jersey to move away from the present fair market value feedstock tax to a broader based waste end fee. It is estimated that the number of taxpayers will increase from approximately 200 to more than 1500. In New York, an industry supported bill to raise additional funds from general revenues has moved from Senate Committee. The administration in California has proposed a 300 million dollar state bond issue to raise immediate resources to accelerate the cleanup efforts. Fund related bills are also being considered or are expected in Michigan, Iowa, Idaho, Connecticut, Maryland, Colorado, Kansas, Missouri, West Virginia, Louisiana, Oregon and Wisconsin. In the area of hazardous waste management many bills have been introduced to address state RCRA issues. The most significant new bill was introduced in California to severely regulate both existing and new surface impoundments and treatment facilities. KEY ISSUE; PUBLIC COMPENSATION By late March, the state public compensation issue had stabilized to the degree that the states where legislative activity, reasonably expected in 1984, are now fairly well defined. The proposals in New Jersey remain the most serious legislative threat. Although hearings originally had been expected as early as March, no committee activity is now anticipated before May. The New Jersey Chemical Industry Council's Legislative Coonittee has established an ad hoc subcosmiittee to work these bills. The subcommittee is chaired by the vice chairman of CMA's State Affairs Committee, so communication and coordination will be assured. In addition, CMA state affairs and legal staff have been working closely CMA 038129 -16- with member company representatives to provide substantive input to the CIC effort. A clearer picture of the timing and direction of the debate is expected as a result of a meeting scheduled for late March between CIC representatives and the sponsor. In Massachusetts activity has accelerated on the study commission established late last year to explore the need for public compensation legislation. The commission is now meeting weekly and is expected to make a report by early fall, state Affairs Committee members met with the Associated Industries of Massachusetts (AIM) staff in early March to discuss how to best support their efforts. Although several pieces of legislation have been introduced, no action is expected this year. Three compensation bills have been introduced in California and a hearing on one of the Assembly bills amending the existing compensation law was scheduled for late March. At this time it is unclear how serious this activity will be this year. Other states with proposals introduced or expected include New York, Minnesota, Illinois and Delaware. A detrimental workers' compensation bill in Ohio now appears dead for this session. KEY ISSUE; RIGHT TO KNOW The litigation involving the federal hazard cewunication standard and the extent of its impact in preempting state and local right to know laws will probably not be resolved until early 1965. In addition to the states of New Jersey, New York and Connecticut which had previously intervened challenging the standard, Illinois has also now joined the suit. While this litigation is pending, many states are still taking the position that they will not be preempted. There is some fora of right to know activity in approximately twenty states so far this year. The moat serious and contentious situation is in Pennsylvania. An'extremely onerous bill was reported out of conmittee and will receive House floor consideration in April. Industry is supporting a bipartisan package of amendments which would bring the bill into closer conformance with the provisions of the federal standard. The vote in Pennsylvania will be extremely close. The other major state where legislation had reached the critical stage was Michigan. However, with the Republicans having gained CMA 038130 -17 control of the Senate, a virtual stalemate exists. Further action is not expected before the fall. A number of states such as North Carolina, Tennessee and Indiana are moving to administratively adopt the federal standard. We hope this will effectively foreclose less desirable legislative activity. Other states actively considering right to know legislation include Iowa, Washington, Maryland, Missouri, Kansas, Kentucky, Florida, Hawaii and Colorado. New workplace related bills are expected soon in Louisiana and Delaware. Community right to know will be an issue in Illinois, Minnesota and Maine, on the positive side, it is now highly unlikely that right to know will emerge this session in Ohio. In addition to all the new legislative activity, several major states who passed broad, complicated and stringent laws in 1983 are struggling to put regulations in place. Agencies in New Jersey, Illinois and Massachusetts are falling behind schedule in their efforts. KEY ISSUE; WATER A bill has been introduced in Maine which requires the state testing lab to provide free water testing services for private wells if any one of the following criteria are met: the well is in the vicinity of a known source of groundwater pollution; the well has had a preliminary testing and shows the presence of hazardous chemicals; other wells in the area show the presence of hazardous chemicals; and the state has reasons to suspect* contamination. The Department of Human Services has the sole power to decide when free testing services are necessary. The Department of Environmental Resources in Florida has formulated a proposed rule which would establish maximum contaminant levels for selected volatile organic contaminants would have to be "routinely monitored" as well. Any potential source of groundwater, e.g,, evaporation percoaltion pond would conceivably need to meet the maximum contaminant level within 100 feet of the edge of the pond. Some of the concentration levels are even below what is generally regarded as being the detection limit for some of these parameters. CMA 038131 -18- KEY ISSUE; AIR Officials of the State and Territorial Air Pollution Program Administrators (STAPPA) are pushing for Congressional support of a proposal to strengthen the role of state toxics regulations in EPA's efforts to control hazardous air pollutants under the Clean Air Act. STAPPA's proposal would accelerate the Clean Air Act toxics listing process, establish best available control technology as the baseline for nation controls and significantly expand current research efforts to improve toxics risk assessment and monitoring techniques. If the agency decides the problem is not national in scope, STAPPA's proposal would refere the chemical to a toxics clearinghouse for an update on the latest research, controls and monitoring data. Drawing on state and local input, the state regulator would eventually set a state regulation, enforced by the state. KEY ISSUE; CHRONIC HEALTH The National Cancer Institute and the U.S. Environmental Protection Agency have published a three volume reference report on cancer mortality rates for counties in the United States. The publication contains comparative data from the decades of the 1950's, 1960's and 1970's. The purpose of the document is to provide information on geographical distribution of cancer mortality. It should not be considered as an analysis of trends in cancer rates. The mortality data are listed for geographic areas for each sex and for white and non-white races. Users of the report should bear in mind that population migration patterns, the long time period between exposure and appearance of most cancer and the medical advances in the knowledge, detection and treatment of cancer are not considered in this study. KEY ISSUE; TRANSPORTATION Legislation introduced in New York by local and state governments would give increased authority to issue meeting rules for hazardous materials. Regional training centers would be established to provide emergency response and enforcement training to local jurisdictions under the bill. The centers would supplement not replace private training classes. DOT would be required to register hazardous materials shippers, transporters and container manufacturers. A study df the most effective method of imposing a user fee on participants in the registration process is to be undertaken by DOT. CMA 038132 19Cincinnati, Ohio has adopted federal regulations to enforce a total ban. on the highway shipment of hazardous materials. The ban is based on the Federal Motor Carrier Safety Regulations which require that motor vehicles carrying hazardous materials must use routes that do not go through heavily populated areas. Representatives of the trucking industry have been meeting with city officials to discuss what would appear to be a clear-cut case of inconsistency with DOT policies. Good Samaritan bills are pending in a number of states including Arkansas, Illinois, Indiana, Iowa, Massachusetts and Missouri. Good Samaritan legislation that would expand coverage from LPG hazardous materials in general has been introduced in Georgia, Mississippi, North Carolina, South Carolina and West Virginia. CMA 038133