DEEP DIVE: EPA Urges Congress to Bolster TSCA Implementation Budget

** Image ** EPA Assistant Administrator for the Office of Chemical Safety and Pollution Prevention Michal Freedhoff urged Congress to provide the agency with additional funding during her 24 January 2024 testimony to the EPW committee. (Credit: EPW Committee)

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The Environmental Protection Agency (EPA) could find itself in the crosshairs of an election-year budget fight, as Democratic and GOP members of the U.S. Senate’s Environmental and Public Works Committee (EPW) articulated different visions for the scope of the EPA’s implementation of amendments to the Toxic Substances Control Act (TSCA). 

While there was bipartisan consensus around the broad notion that the EPA’s implementation of TSCA protocols would be vital for both worker safety and consumer safety, several GOP members voiced concerns about the implications of the chemical program across a wide spectrum of issues, from agriculture to national security. 

“Although we are focused on building an efficient and sustainable scientific and regulatory infrastructure for this still young law, in order for the TSCA program to work as Congress and the American public expect and deserve, we simply must have more resources,” EPA Assistant Administrator for the Office of Chemical Safety and Pollution Prevention Michal Freedhoff said during her 24 January 2024 testimony to the EPW committee. 

In her prepared remarks, Freedhoff said the federal government doesn’t need additional laws. Rather, she added, it needs to fully fund the EPA to implement the laws on the books. 

Review

In 2016, Congress enacted the Frank R. Lautenberg Chemical Safety for the 21st Century Act to amend TSCA due, in part, to long-standing concerns that EPA lacked sufficient authority to obtain information and regulate chemicals that present unreasonable risks, according to a 2021 report from the Congressional Research Service.

On 8 January 2024, the EPA finalized a rule that bars companies from making or processing 329 per- and polyfluoroalkyl substances (PFAS) which were listed on the inactive portion of the TSCA inventory without a complete EPA review and risk determination. 

The TSCA program’s 2023 fiscal year budget was $82.8 million, and President Joe Biden’s 2024 budget calls for a $48 million increase, or $130.7 million total. This increase would provide more than 100 new employees to aid the chemical review process and support risk evaluation and management of existing chemicals, particularly with emerging concerns surrounding the proliferation of PFAS. The funding package would also contribute to the modernization of workflow systems and information technology. 

EPW Committee Chairman Sen. Tom Carper, (D-De.) said the EPA has been tasked with high expectations and a heavy workload but has not always been equipped with the necessary funding to complete this technical work. 

For example, the EPA was required to complete formal reviews on only 20% of new chemicals in the first 40 years since its founding in 1976, but now is tasked with completing reviews for 100% of new chemicals. 

“Insufficient resources, over the course of multiple fiscal years, have led the agency to miss deadlines and delay decisions,” Carper said. “This situation has created grievances from both those in industry pushing to get their chemicals to market and from environmental advocates eager to see harmful chemicals regulated.” 

Carper and Freedhoff said EPA has punched above its weight despite being underfunded. It has developed a standardized review approach for mixed metal oxides, which are used for batteries, electric vehicles, semiconductors, and renewable energy generation. It has also designated five new chemicals to prioritize for risk evaluation, including vinyl chloride, one of the hazardous chemicals spilled during the Norfolk Southern freight train derailment in East Palestine, Ohio in February 2023.

Ranking Committee Member Sen. Shelley Moore Capito (R-W.Va.) said the EPA should look to streamline its New Chemicals Program for Premanufacture Notice (PMN) chemicals and that the Intergovernmental Personnel Act (IPA) could help staff the experts the EPA needs to implement TSCA. She also pointed to Title 42 as a mechanism for funding for additional positions. 

“It doesn’t matter what side of the aisle you are,” said Capito. “It's always, ‘I just need more money. If I had more money, I would solve every single problem.’ And sometimes we have to be more efficient. We have to be more innovative.” 

Freedhoff said the EPA has utilized the IPA but said there are limits to its utility as other agencies are also facing similar challenges with resources. Bringing on additional senior scientists to work on PMN cases is a more expensive endeavor, she added.  

Analysis

“We have tried to heed Congressional direction to reflect the accurate costs of implementing the law in our proposed fees rule,” EPA Assistant Administrator for the Office of Chemical Safety and Pollution Prevention Michal Freedhoff said, adding that she expected it to be finalized in the coming weeks. It is currently under review by the Office of Management and Budget (OMB).

The proposed revisions aim to ensure that the TSCA fee amounts capture up to 25% of the actual costs of TSCA activities, distribute fees equitably, and identify fee payers through a transparent process.

• Exemptions:  Would exempt certain manufacturers from EPA-initiated risk evaluation fees, including importers of articles containing a chemical substance, companies that produce a chemical as a by-product or manufacture or import as an impurity, companies that use chemicals solely for research and development purposes, companies that produce a chemical in less than 2,500 lbs., and companies that manufacture a chemical that is produced as a non-isolated intermediate. 
• Fee Allocation: A production-volume-based fee allocation means export-only manufacturers pay fees for EPA-initiated risk evaluations. 
• Payment Flexibility: Increase flexibility for companies by extending the amount of time to form a consortium to share in fee payments and allowing payments in installments for EPA-initiated and manufacturer-requested risk evaluations. 
• Refunds: A partial refund of fees for premanufacture notices withdrawn at any time after the first 10 business days during the assessment period of the chemical. 
• Test Order and Test Rule Fees:  An expansion of the fee requirements to companies required to submit information for test orders and modify the fee payment obligations to require payment by processors subject to test orders and enforceable consent agreements (ECA). 
• Fee Adjustment: The EPA announced legally mandated changes to the fee requirements under TSCA, which directs the EPA to adjust the fees every three years. An adjustment went into effect on 1 January 2022, and applies to all TSCA fees.  

Freedhoff told 3E after the hearing that while there may be some sunk costs in the form of additional IT expenses and scientific equipment upfront in the White House budget, the additional costs reflect the needs of the underfunded agency to keep up with the demands of the work required of the EPA to protect its stakeholders in the general public and industrial producers or users of affected chemicals. 

“The [Biden Administration’s] budget request is what we think it takes to implement the law, the way Congress expected us to implement the law,” Freedhoff said. “The House budget is the pre-2016 budget for the office, so there are pretty stark differences there. I don't think there had been a robust workforce analysis that had been done in the first few years of law effort — the 2024 budget request is based on that kind of analysis. Right now, that's what we think it takes to get the job done.” 

About the author: Stefan Modrich is a Washington, D.C.- based reporter for 3E. He covers the latest developments in environmental health and safety policy and regulation. Modrich previously wrote for S&P Global Market Intelligence, The Arizona Republic and Chicago Tribune. He is an alumnus of Arizona State University and the University of Zagreb.