NASF Releases Public Policy Update for April 2021

This month began with key news on COVID, specifically, a continued delay for OSHA’s much-anticipated COVID emergency temporary standard for U.S. workplaces. President Biden also just nominated California's a workplace safety chief, Doug Parker, to head OSHA.

In Congress, the White House push has begun for a sweeping $2 trillion infrastructure bill following recent passage of the nearly $2 trillion COVID stimulus package.

At the agencies, NASF is closely following action to implement the President’s executive order for review of vulnerabilities in critical supply chains and U.S. manufacturing capacity. On the state front, California launched bold next steps to ban hexavalent chromium, while it and other states accelerate regulatory action on PFAS.

NASF remains actively engaged on a number of rules and decisions impacting the finishing industry. We’ve summarized below just some of the pertinent legislative and regulatory developments and new announcements from recent days. 

NASF Virtual Public Policy Updates for Chapters 

The NASF Government Affairs team is continuing its outreach to NASF Chapters and members with virtual public policy briefings. If you would like to schedule an NASF public policy briefing for your chapter or your region, please contact Matt Martz at mmartz@nasf.org or Jeff Hannapel at jhannapel@thepolicygroup.com. To join NASF or find out more about membership, please contact Matt Martz at mmartz@nasf.org.

COVID Stimulus: The American Rescue Plan Act Becomes Law

As the NASF March 2021 newsletter was going to press, President Biden signed into law the American Rescue Plan Act (ARPA) on March 11, 2021. The act provides for $1.9 trillion in aid and relief to individuals, businesses and local governments that continue to feel the impact of the coronavirus pandemic. This most recent federal action brings the total economic relief tab to approximately $6 trillion in the past year. Some of the key relief provisions in the act are summarized below.

Direct Stimulus (Economic Impact) Payments – ARPA allows for approximately $410 billion in direct payments of up to $1,400 in 2021 to individuals who are eligible.

Extended Unemployment Benefits – ARPA extends the federal unemployment benefit supplement of $300 a week through September 6, 2021. It also contains a new provision to exempt $10,200 of unemployment benefits received in 2020 from income taxes. 

Expanded Child Tax Credits – The Child Tax Credit was increased from $2,000 per child up to $3,600.

COVID Testing, Tracing, and Vaccines – ARPA allows approximately $415 billion in increased funding for a national vaccination program, COVID-19 testing, contact tracing, scientific research and development, and manufacturing of pandemic-related medical supplies.

State and Local Government Aid – The act provides approximately $360 billion to state, local, and tribal governments to support the public health response, help address revenue losses, provide support for a recovery (including through assistance to households, small businesses and nonprofits, aid to impacted industries, and support for essential workers), and provide resources for investment in infrastructure, including water, sewer, and broadband services.

Homeowner Assistance Fund – ARPA provides nearly $10 billion relief for eligible homeowners to address delinquent mortgage payments and promote household stabilization. This effort is designed to minimize foreclosures, alleviate emergency shelter capacity, and mitigate potential COVID-19 infections.

Emergency Rental Assistance – ARPA provides $21.6 billion to assist households that are unable to pay rent and utilities due to the COVID-19 crisis. The new funding will leverage existing program structures to allowing for money to be disbursed quickly and efficiently and ensure that the hardest-hit families receive their equitable share of relief.

Employee Retention Credit and Paid Leave Credit Programs – ARPA extends the availability of the Employee Retention Credit for small businesses through December 2021 and allows businesses to offset their current payroll tax liabilities by up to $7,000 per employee per quarter. This credit of up to $28,000 per employee for 2021 is available to small businesses that have seen their revenues decline, or even been temporarily shuttered, due to COVID. The Act also extends through September 2021 the availability of Paid Leave Credits for small and midsize businesses that offer paid leave to employees who may take leave due to illness, quarantine, or caregiving. Businesses can take dollar-for-dollar tax credits equal to wages of up to $5,000 if they offer paid leave to employees who are sick or quarantining.

While most of the measures in ARPA are intended to be temporary to allow time for economic recovery, there have been discussions in Congress about making some of them extend beyond 2021 or become permanent, depending on the timing of the economic recovery and the effectiveness of the relief packages. The full text of the ARPA is available at:  https://www.congress.gov/bill/117th-congress/house-bill/1319/text.

President Biden Announces Infrastructure Plan

On March 31, 2021, the Biden Administration released its broad plan to address the country’s infrastructure. The “American Jobs Plan” calls for a grand total of more than $2 trillion in federal investment emphasizing infrastructure. It takes a broad view of what constitutes “infrastructure” and supports President Biden’s other stated priorities, including climate change and environmental justice. With the possibility of a tax increase to help fund the package, stronger political headwinds are anticipated.

Legislative Outlook

To become a reality, President Biden’s broad infrastructure plan will need to be articulated in legislative language, and then proceed what appears to be a lengthy process in Congress. The White House would like to see significant progress by Memorial Day, but House leadership has indicated that July would be a more realistic target. 

While Democrats are generally supportive of the approach outlined by the President, several revisions are anticipated to get broader party support. Senate Republicans have voiced initial opposition to the President’s plan, particularly any proposed tax increases to pay for the plan. Some Republicans will likely support more traditional infrastructure provisions such as funding for roads and bridges.

Given the prolonged process ahead and the slim majorities in both the House and Senate, significant opportunities exist to influence the final bill. As the bill is developed, it will be important for the manufacturing and finishing community to remain abreast of changes to the bill and opportunities to shape those changes. 

Summary of the Infrastructure Plan

A copy of the White House fact sheet on the infrastructure plan is available at: https://www.whitehouse.gov/briefing-room/statements-releases/2021/03/31/fact-sheet-the-american-jobs-plan/. The key funding areas of the bill are summarized below:

Repair Roads and Bridges -- The plan includes $115 billion to improve bridges, highways, and roads in critical need of repair.

The plan calls for pairing repairs with improvements to safety and greater resilience, including from the anticipated impacts of climate change and includes provisions aimed at reducing traffic congestion, creating new facilities for pedestrians and cyclists (to reduce greenhouse gas emissions), and focus on programs to reduce crashes and fatalities, particularly for cyclists and pedestrians. In addition, resources will be allocated to address racial equity issues.

Major Investment in Electric Vehicle Market -- The plan further links infrastructure upgrades to tackling climate change with a proposed $174 billion investment in electric vehicles (EVs) to incentivize automakers and suppliers to transition to the manufacture of EVs and batteries. The automobile industry has indicated its willingness to invest $250 billion toward the EV transition by 2023.

The infrastructure package also proposes funding for point-of-sale rebates and tax incentives for EV-buying consumers and developing a national network of 500,000 EV chargers by 2030 to address longstanding consumer concerns over charging EVs. Environmental justice and racial equity concerns will be addressed in siting EV charging stations.

Electric Grid Upgrades-- The plan also allocates $100 billion to “reenergize America’s power infrastructure.” A central component of that effort calls for tax incentives to mobilize private capital to spur build out of new, high voltage transmission lines to increase grid resiliency and interconnection among existing regional grids. New transmission lines will be key to connecting expanding renewable energy generation with the demand for electricity.

Clean Energy Incentives -- The plan addresses energy generation and transmission and promotes incentives for “clean energy” (i.e., renewable and other low- or no-emission sources of energy) and energy storage through the extension of existing tax credits and clean energy grants to state, local, and tribal governments. The plan also calls for federal investment in decarbonized hydrogen and carbon capture demonstration projects.

Other Climate Change Focus -- The infrastructure plan aims to reduce carbon emissions with provisions to incorporate energy efficiency—through tax credits, funding, and grants—in the broader effort of building or retrofitting more than two million homes, modernizing public schools, and upgrading child care facilities.

The plan also would allocate $35 billion for research on technological solutions to climate change and $46 billion of federal procurement spending focused on clean energy technologies, and eliminate existing tax breaks for the fossil fuel industry to help fund the plan and to reduce carbon emissions.

Proposed Legislation to Offer Medical Monitoring for PFAS

Senator Kirsten Gillibrand (D-N.Y.) and Representative Madeleine Dean (D-Pa.) has announced the "PFAS Accountability Act", elevating efforts to address health impacts from per- and polyfluoroalkyl substances (PFAS). The bill focuses on improving legal pathways through which people exposed to PFAS can be awarded medical monitoring, in addition to encouraging funding for safety research on the family of thousands of nonstick toxic substances.

The legislation would create a medical monitoring program, with individual eligibility based on factors including pending litigation relating to exposure, or community proximity to sites like military bases and airports. Individuals would be considered "significantly exposed" based on either blood testing or ability to demonstrate proximity to a contaminated area for at least one year. 

People in vulnerable careers, like firefighters or workers who handle PFAS, would also be eligible. The legislation would also allow courts to award medical monitoring, and would establish a federal cause of action allowing exposed people to bring claims against PFAS manufacturers.

Groups that have been active on PFAS issues have already backed the new bill, including the activist organization Environmental Working Group. The bill's implications for PFAS manufacturers could prompt significant industry pushback. The American Chemistry Council said it will review the legislative language to determine how PFAS are defined by the bill as well as exposure levels and which chemistries are included. For more information on this proposed legislation and its potential impact on the surface finishing industry, contact Jeff Hannapel with NASF at jhannapel@thepolicygroup.com. 

California Announces Rule to Transition Hexavalent Chromium Processes to Trivalent Chromium

California Air Resources Board (CARB) announced that it is moving forward with a rulemaking that would require the transition of all decorative chromium processes to trivalent within two years, begin transitioning functional chromium processes to trivalent chromium within four years, and impose stringent control measures on other processes using hexavalent chromium. CARB has targeted the end of 2021 to finalize the rule.

Last month NASF and its California chapters arranged a chromium plating symposium for CARB regarding the status of trivalent chromium plating technology and the current barriers and time lines for a broad application of trivalent chromium processes. 

The symposium highlighted the surface finishing industry’s proactive approach to promoting innovative technologies and implementing risk management options for hexavalent chromium and included subject matter expert panels in four areas: (1) decorative chromium plating; (2) functional or hard chromium plating; (3) implications for aerospace and defense applications; and (4) perspectives from job shops in California.

Despite the fact that the chromium plating industry’s releases only four pounds of hexavalent chromium emissions in California (based on CARB’s estimate) and is responsible for less than one percent of all total hexavalent chromium emissions, CARB has decided to move forward with this rule to eliminate hexavalent chromium finishing processes.

NASF and its California Chapters have repeatedly informed CARB officials that customer preferences and specifications as well as lack of available trivalent chromium technology present significant barriers to implement the rule requirements as outlined by CARB. The rule could cause irreparable economic damage to the chromium plating industry in California as well as to the vital supply chains it serves.

NASF and its California Chapters continue to hold an ongoing dialogue with CARB officials on the rulemaking. In addition, the California Chapters are embarking on a campaign to inform CARB members and state legislators that the industry: (1) has effectively reduced hexavalent chromium emissions; (2) is committed to transition to trivalent chromium processes where the technology exists and customers will allow, and (3) will sustain potentially severe economic damage in California. 

NASF and its California Chapters will continue to work with state officials and industry partners to develop a rule that is protective of human health and the environment and is economically sustainable. For more information of this rulemaking, please contact Jeff Hannapel with NASF at jhannapel@thepolicygroup.com.

EPA Grants Temporary Reprieve to TSCA PBT Chemical Prohibition 

Many surface finishing companies have received letters from customers asking them if any of as list of five persistent, bio-accumulative and toxic (PBT) chemicals are used in the manufacture of any component or product that they purchase from them. The NASF is issuing the following guidance on the issue:

On January 6, 2021 EPA issued a prohibition under section 6(h) of the Toxic Substances Control Act (TSCA) for five persistent, bio-accumulative and toxic (PBT) chemicals, including:

TSCA section 6(h) requires EPA to take expedited action on specific PBT chemicals to address risk and reduce exposures to the extent practicable. Despite a multi-year rulemaking process, a large majority of effected industries were unaware of how widespread at least one of the regulated PBT substances is in the products or components that they manufacture or import. PIP (3:1) is a widely used plasticizer and flame retardant that is present in a wide range of components, particularly electronics including cell phones, semi-conductor manufacturing equipment, wiring harnesses, and even, as EPA noted, “equipment used to move COVID-19 vaccines and keep them at appropriate temperature.” 

With the prohibition entering into effect on March 8, and only limited exemptions in the current rule, many companies were faced with a major dilemma in that compliance could prevent access to as well as the import of critical parts or materials. EPA indicated that it was not its intent during the development of the rule to have such a broad disruptive impact. 

To avoid imminent supply chain disruptions to large sectors of the economy, EPA agreed to a 180-day pause in enforcement of the PIP (3:1) prohibitions, exercising its enforcement discretion in the form of a “no action assurance” letter. EPA also announced a 60-day comment period to re-examine the rules issued on January 6, 2021 for the five PBTs, with a particular re-examination of exposures to potentially exposed or susceptible subpopulations, and the environment, and whether additional or alternative measures should be considered. The EPA press release, with links to additional information, is available here.

As we noted above, many surface finishing companies have received letters from customers asking them if any of the five PBT chemicals are used in the manufacture of any component or product that they purchase from them. Based on input from chemical suppliers, we are not aware of any uses of these chemicals in the surface finishing industry. Because PIP (3:1) is used as a plasticizer, surface finishers may want to ask suppliers whether this chemical is used in making plastic tank liners, and if so whether it can be released from the liners.

If you have any questions or would like additional information on EPA’s prohibition on these PBT chemicals, please contact Jeff Hannapel with NASF at jhannapel@thepolicygroup.com.

PFAS in Rainwater

Based on a recent research both new and phased-out per- and polyfluoroalkyl substances (PFAS) were detected in rainwater collected in the Ohio-Indiana region. The research team used mass spectrometry to detect 17 kinds of PFAS in rainwater collected in summer 2019 at seven urban, suburban, and rural sites at concentrations of ranging from 50-850 parts per trillion.

The researcher hypothesized that these persistent chemicals may be transported in the atmosphere and can be deposited far from the source via precipitation. The research team indicated that it was surprised that long- and short-chain PFAS were equally present in rainwater, expecting to find lower concentrations of long-chain PFAS because they are less volatile and water soluble. 

Rainwater samples also contained high levels of perfluorooctanoic acid (PFOA), which is no longer made in the US. The continued presence of PFOA is likely explained by its ability to persist in the environment over the long term. In addition, high levels of PFOA’s relatively new replacement, hexafluoropropylene oxide dimer acid (HFPO-DA), were also found in the rainwater samples. The next step in the research is to perform isomeric fingerprinting in the hopes of tracing some of the PFAS that were detected in rainwater back to local point sources in the region.

State Agency Chiefs Release Updated White Paper on PFAS

There are no federally enforceable PFAS standards, so states have taken the lead in developing enforceable standards and other values for PFAS in drinking water, groundwater, surface water, soil, or other environmental media. The Environmental Council of the States (ECOS) in 2019 compiled information on state PFAS standards, advisories, and guidance values in a white paper entitled, “Processes and Considerations for Setting State PFAS Standards.” 

This document outlines ECOS’ findings on state efforts and considerations for future regulatory activities on PFAS. The document, initially published in February 2020, was updated in early 2021 with new information and state participants. A copy of the white paper is available at: https://www.ecos.org/documents/ecos-white-paper-processes-and-considerations-for-setting-state-pfas-standards-2021-update/.

NASF is Reviewing the Latest Proposed Update to OSHA Hazard Communication Standard

The Occupational Safety and Health Administration (OSHA) recently issued a notice of proposed rulemaking (NPRM) to amend and update the agency's Hazard Communication Standard. The proposed rule was published in the Federal Register on February 16, 2021 and can be found here. A general overview presentation by OSHA and other materials and updates, can be found here.

The proposal would update the current US regulation to align with the most recent version (revision 7) of the UN Globally Harmonized System of Classification and Labeling of Chemicals (GHS). It also seeks to harmonize provisions of the HCS with Canada and other U.S. agencies, and respond to issues that have emerged from industry and other stakeholders since OSHA's last change to the standard in 2012.

The proposed revisions will trigger compliance obligations for employers meaningfully subject to the Hazard Communication Standard, including: updating the label and safety data sheet (SDS) for every chemical manufactured or imported into the US; updating written programs; updating training programs; providing training updates to all employees; and reclassifying many chemicals. In addition under this proposal, a chemical manufacturer or importer would be responsible for additional requirements that go beyond GHS, including identifying:

• each downstream chemical reaction of its chemical (with any substance or mixture) 

• that is conducted or naturally occurs in commerce in the US;

• each hazard posed by each of those reactions;

• each product (including by-products and decomposition products) of those reactions; and

• and classifying each hazard posed by those reaction products.

In other words, the chemical supplier-manufacturer could be responsible for performing the front end of a process hazard analysis for every downstream chemical reaction of its product or a mixture containing its product, and for classifying its product based on the hazards of the products of those downstream reactions.

NASF, in concert with other manufacturing organizations, is reviewing the proposed rule changes to determine if comments are needed. The deadline for comments is April 19, 2021.

If you have questions, please reach NASF by contacting Jeff Hannapel at jhannapel@thepolicygroup.com or Christian Richter at crichter@thepolicygroup.com.

To join NASF or find out more about membership, please contact Matt Martz at mmartz@nasf.org.

This policy update is courtesy of the National Association for Surface Finishing (NASF). For more information, visit nasf.org.