The damage done, Part 1: A post-mortem on the Trump EPA’s assault on TSCA’s new chemicals program

Richard Denison, Ph.D., is a Lead Senior Scientist.

Part 1 of a 2-part series (see Part 2 here)

With last week’s announcement by EPA that it intends to reverse two of the most damaging policy changes the Trump EPA made to EPA’s reviews of new chemicals under the Toxic Substances Control Act (TSCA), there is hope that going forward EPA’s reviews will once again conform to TSCA’s requirements and better protect workers, consumers, the public and the environment.

Predictably, the chemical industry and its phalanx of law firms – who demanded and embraced the Trump EPA’s policy reversals – have been howling loudly, doing their best impressions of Chicken Little.  They predict huge backlogs and economic calamity of all sorts, including an end to American innovation, and their lawyers are already threatening legal action – a clever way to drum up business, no doubt.

The fact is that EPA spends scarce resources reviewing hundreds of new chemicals every year that their manufacturers are not serious about – and often not in any hurry about – commercializing.  And industry then uses any delays in those reviews to argue that the review process is too rigorous and demand that it be scaled back.

But facts are stubborn things.

In this first post I’ll look at a few reasons why the industry’s new round of fear-mongering is not based in fact.  And in a second post I’ll look at the decisions on new chemicals made under the Trump EPA to shed more light on the real reason why industry is upset:  It just may have lost the inside track that yielded such high dividends in the form of flawed approvals of hundreds of new chemicals.  Or, as one prominent industry attorney bluntly said recently in a related context, “the good days are over, quite frankly.” 

Debunking the return-of-the-backlog myth

Back in 2018, then-Administrator Scott Pruitt used the excuse of the backlog in new chemical reviews to upend EPA’s then-succeeding implementation of the TSCA amendments governing new chemicals.  Yes, a temporary backlog had developed because the TSCA amendments made major improvements that had to be immediately applied by EPA, without allowing any time for a transition.  But by the time Pruitt announced his illegal policy reversals and claimed they were necessary to address the backlog, EPA’s own data showed that the backlog had already nearly been eliminated by EPA career staff who were diligently implementing the program in a manner that conformed to the law.  Those same data showed that immediately following Pruitt’s imposition of changes, the backlog began to grow again.

EPA’s earlier success in addressing the initial backlog while legally implementing the law – before the Trump EPA upended things – bodes well for the Biden EPA to return to that state of affairs.  EPA’s announcement last week is a strong start to that process.

Debunking the stifling-innovation myth

This industry argument has been one of its favorite go-to’s for many years (see, e.g., here and here).  It goes like this:  “If EPA doesn’t quickly allow virtually every new chemical it reviews onto the market without restriction, American innovation will suffer.”  And industry goes further, to assert that TSCA itself calls on EPA to promote innovation and hence, that conducting rigorous new chemical reviews is somehow at odds with Congress’ intent under TSCA.

This spurious claim relies on the only reference to innovation in all of TSCA, in a list of the law’s policy intentions (section 2(b)(3)), same language in both the old and new law).  Industry players love to distort this provision, so let me quote it in its entirety (emphasis added):

(b) POLICY.—It is the policy of the United States that—

(3) authority over chemical substances and mixtures should be exercised in such a manner as not to impede unduly or create unnecessary economic barriers to technological innovation while fulfilling the primary purpose of this Act to assure that such innovation and commerce in such chemical substances and mixtures do not present an unreasonable risk of injury to health or the environment.

When citing this provision, industry typically does one of two things.  It either deceptively paraphrases the provision as saying that, under TSCA, EPA shouldn’t act in a manner that impedes innovation.  Or it selectively quotes the provision – deceptively lopping off the second half of it (the part I added emphasis to above).

But Congress made clear that TSCA’s primary purpose is to ensure that any innovations tied to chemicals do not present unreasonable risks – quite the opposite of industry’s assertion.

Given that the development and application of new chemicals are a clear source of innovation, how else did Congress intend for EPA to provide an assurance that innovation and commerce in chemicals do not present unreasonable risk other than through robust scrutiny of new chemicals prior to their commercialization?

Another reason to question the industry’s playing of the innovation card

You might think based on the industry’s and the last administration’s obsession with streamlining new chemical reviews and emphasizing speed to market over everything else that it really was motivated by its desire to get new chemicals into use as fast as possible.  The facts simply don’t bear that out.

I looked at chemicals that were cleared for market entry by either receiving a “not likely to present an unreasonable risk” determination by EPA, or being subject to a consent order signed by the chemical’s manufacturer and EPA.  I then asked this question:  For how many of these approved chemicals had their manufacturers submitted a Notice of Commencement (NOC), which is required under TSCA to be submitted within 30 days of a company starting to make or import a new chemical for commercial purposes?

If companies’ demands for fast EPA approvals were based on their need to get their new chemicals quickly onto the market, you would expect the they would have promptly filed a NOC for the vast majority of such chemicals.  Yet here are the facts:

  • Since TSCA was reformed in 2016, fewer than half (45%) of new chemicals that got a “not likely” determination have been NOC’d. Perhaps counterintuitively, a larger fraction (60%) of new chemicals subject to consent orders have been NOC’d.
  • If one looks only at the period since mid-2018 when the Trump EPA’s weakening policy changes took hold, nearly the same proportion (43%) of “not likely” chemicals have been NOC’d. An even smaller fraction of chemicals subject to consent orders (28%) have been NOC’d.

This phenomenon of many approved but un-NOC’d new chemicals has historically been the case even before TSCA reform.  The makers of a large fraction, on the order of half, of all new chemicals EPA reviews and approves for market entry decide for whatever reason not to start commercial manufacture.

Some have argued that the relatively low cost that companies incur to send their chemicals through the review process leads them to seek approval even of chemicals they have little likelihood of commercializing.  While those costs have gone up since TSCA reform because EPA raised the fees it charges (from $2,500 to $16,000) so that they come closer to reflecting the agency’s costs to review new chemicals, the fees are still relatively low; moreover, both in its 2018 fee rule, and again in the proposed revisions now pending, the Trump EPA stated it wanted to keep those fees low so as to “minimize the potential impact on innovation and competitive standing” (2018) or not “stifle economic development in the chemical industry” (2021).

The fact is that EPA spends scarce resources reviewing hundreds of new chemicals every year that their manufacturers are not serious about – and often not in any hurry about – commercializing.  And industry then uses any delays in those reviews to argue that the review process is too rigorous and demand that it be scaled back.

 

Stay tuned for Part 2, when I’ll look at the new chemical decisions EPA made under the Trump administration to shed more light on the real reason why industry is upset at the recent changes the Biden EPA is making.

 

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