EPA Proposes Changes to TSCA Fees Rule

ACA to Comment on EPA’s Priority Chemicals for TSCA Risk Evaluation

On Dec. 21, 2020, the U.S. Environmental Protection Agency (EPA) proposed updates to its Toxic Substances Control Act (TSCA) Fees Rule, finalized in October 2018. TSCA requires that EPA collect fees from chemical manufacturers and processors to help defray 25% of costs associated with most TSCA implementation efforts; 50% of costs associated with manufacturer-requested risk evaluations of TSCA workplan chemicals; and 100% of costs for manufacturer-requested risk evaluations of other chemicals. The law also directs EPA to review the TSCA Fees Rule, and, if necessary, adjust fees every three years. In March 2020, the agency announced its plan to initiate a new rulemaking process to update the fees rule.

EPA is accepting comments on the proposal through Feb. 25, 2021.

EPA proposes increases to risk evaluation fees based on projected costs per chemical to conduct a risk evaluation. EPA estimates approximately $2.84 million per chemical for chemicals on the TSCA Work Plan and $5.67 million per chemical for chemicals not on the TSCA Work Plan.

EPA proposes the following fee increases to recover a percentage of total costs:

  • $2,560,000 paid jointly by manufacturers and importers for EPA-initiated chemical risk evaluations. Current fee amount is $1,350,000 per chemical.
  • A company requesting a risk evaluation of a TSCA workplan chemical would make two payments of $945,000 plus an additional final payment to cover any remaining costs to cover 50% of actual costs. Current fee amount is $1,250,000 plus an additional payment to recover 50% of actual costs.
  • A company requesting a risk evaluation of a chemical not included on the TSCA workplan would make two payments of $1,890,000 with a final payment to cover any remaining (100%) of actual costs. Current fee amount is one payment of $2,500,000 with an additional payment for any remaining actual costs.

EPA is not proposing an increase for the PMN (pre-manufacture notice) filing fee, set at $16,000. EPA proposes an increase for other fees associated with new chemical review, as follows:

  • Companies would pay $500 to a bona fide notice of intent to manufacture or import. Currently no fee is required.
  • Companies would pay $500 to file a notice of commencement after PMN review. Currently, no fee is required.

EPA also proposes changes to timing for fee payment. For EPA-initiated risk evaluations, payment is collected over two installments, with the first payment of 50% due 180 days after EPA publishes the final scope of a chemical risk evaluation. The second payment is due not later than 545 days after EPA publishes the final scope of a risk evaluation. Currently, payment is due in one payment 120 days after publication of the final scope. The timeline for manufacturer-requested risk evaluations is also extended to 180 days after providing EPA with notification for the first payment of three installments.

Background

In its press release announcing the proposed updates, EPA identified changes to the original 2018 TSCA Fees Rule as accomplishing the following:

  • Narrowing the scope of the rule by exempting importers of articles containing a chemical substance, companies that produce a chemical as a byproduct or manufacture or import as an impurity, companies that produce a chemical in de minimus amounts, companies that use chemicals solely for research and development purposes, and companies that manufacture a chemical that is produced as a non-isolated intermediate from fees.
  • Using cost data gathered over the last two years, instead of estimates, to update the fee calculations.
  • Ensuring fees are fairly and appropriately shared across companies by proposing a production-volume based fee allocation and including export-only manufacturers for EPA-initiated risk evaluations.
  • Allowing for corrections to be made to the list of manufacturers subject to fees for EPA-initiated risk evaluations after the final list is published, ensuring the accuracy of the list.
  • Increasing flexibility for companies by extending the amount of time to form consortium to share in fee payments.
  • Ensuring EPA can fully collect fees and enabling companies to better prepare for paying fees by allowing payments in installments for EPA-initiated and manufacturer-requested risk evaluations.

Additionally, EPA’s proposal adds new fee categories associated with new chemicals activities. While EPA is proposing to add three new fee categories for Bona Fide Intent to Manufacture or Import Notices, Notices of Commencement of Manufacture or Import, and an additional fee associated with test orders, EPA is proposing exemptions for:

  • Research and development activities;
  • Entities manufacturing or importing less than 2,500 lbs. of a chemical subject to an EPA-initiated risk evaluation fee (unless all companies are manufacturing/importing below that level);
  • Manufacturers of chemical substances produced as a non-isolated intermediate; and
  • Manufacturers of a chemical substance subject to an EPA-initiated risk evaluation if the chemical substance is imported in an article, produced as a byproduct, or produced or imported as an impurity.

More information on TSCA Fees is available on EPA’s website, here.

Contact ACA’s Riaz Zaman for more information.

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