Archive for February, 2016

The Leap Year Effect at the CPSC

Leap year occurs every four years when an additional day is added to the calendar—February 29.  This is a corrective measure to account for a lack of precision in the earth’s orbit around the sun.   According to old folk traditions, during a leap year, role reversals are common, upsetting the usual norms of behavior.  We saw two examples of the leap year effect in operation last week when the CPSC considered its 2016 operating plan.

During last week’s meeting, Commissioner Mohorovic proposed that the agency adopt an enforcement policy to eliminate a costly and burdensome p impacting the apparel and footwear industry but that could set a useful precedent for other industries as well.  The 2008 Consumer Product Safety Improvement Act requires that manufacturers and importers certify that their products comply with safety regulations.  One of those regulations deals with the flammability characteristics of fabrics used in apparel, sets out testing criteria to determine flammability and exempts from testing those fabrics that, because of their weight and material, inherently do not present the risk that the rule is concerned with.  As the agency rushed to quickly (and somewhat thoughtlessly) implement the requirements of the CPSIA, a majority of commissioners determined that apparel manufacturers needed to certify that exempt fabrics were, indeed, exempt from testing—in other words, they were required to certify that they did not need to test and certify.  Talk about circuitous logic!

But this overreach by the agency is costing the apparel industry—and consumers–$250 million each year in paperwork costs.  These costs have nothing to do with assuring the safety of consumers and are totally related to wasteful paperwork requirements.  Commissioner Mohorovic was able to convince his colleagues to reverse their earlier position and adopt an enforcement policy that abrogates this process of “certifying that you do not need to test and certify.”

In a similar example of good judgment trumping regulatory excessiveness, at last week’s meeting, Commissioner Buerkle convinced her colleagues to agree to direct staff to prepare a briefing package on the attributes of the California revised rule (known as TB-117) addressing the smoldering hazards associated with upholstered furniture.  The flammability hazards associated with upholstered furniture have been flummoxing the agency since it was created.  The agency exacerbated the problem by insisting that any rulemaking address every ignition source for upholstered furniture fires —not only the vast majority of fires that are caused by smoldering cigarettes, but also those caused by open flames such as lighters and candles. This insistence made the process of writing a rule that much more difficult.  And since the majority of fires are caused by smoldering cigarettes, the agency’s approach meant that the risk of upholstered furniture fires went unaddressed while the regulators pursued unrealistic and uneconomical solutions.  Given this dithering on the federal level, California took the practical step of writing a standard that applied to smoldering fires, which account for the vast majority of fires.

Commissioner Buerkle’s proposal asking the staff to analyze the California regulation is a good first step in moving the agency toward a realistic and, hopefully, more timely effort to address this important issue.  After close to 40 years of analysis, it is time that the agency brought this rulemaking to a sensible resolution.  I hope that Commissioner Buerkle’s proposal has given the CPSC staff the latitude to accomplish this objective—one which advances consumer safety in a practice way.

Isn’t it too bad that leap year comes only every four years.

“Means are Inconsequential; Only the Ends Matter”

History is replete with examples of bad things that happen when good people, with good motives, act to achieve an end without regard to the means used.  The CPSC’s letter last week to sellers of self-balancing scooters (most of us call them hover boards) brings squarely to mind that Machiavellian notion about ends justifying means.

The agency’s action came in the form of a letter from the acting director of compliance to sellers of hover boards telling them that their products should comply with the newly-released UL voluntary safety standard addressing the risk of fire associated with some of these products. Those products that do not comply with this voluntary standard will be considered by agency staff “to be defective and . . .may present a substantial product hazard,“  thereby triggering the reporting and recall provisions of §15 of the Consumer Product Safety Act and related penalty provisions.  While this may perhaps be a good safety result, the statute sets out a path for achieving this result and that path involves a bit more by way of due process than just issuing a decree to make it so, as seems to have been done here.  That path forward is set out in §9(b) of the Act and instructs the agency on how to rely on voluntary standards to address an established safety risk.

Few would argue against the need to address the safety issues associated with hover boards that have been highlighted in recent months.  And the CPSC is to be praised for its desire to investigate and fashion an across-the-board solution as opposed to its unfortunate recent tendency to regulate class-wide hazards by recall or retailer intimidation.  But no matter how laudable the motives of the agency may be, short-circuiting the statute is never good practice by a regulator.  Yet, in a striking example of ends justifying means, this is exactly what the agency has done.

9(b) of the Act sets out a process for the agency to use when it wishes to rely on voluntary standards to address safety hazards. That process requires the agency to collect and consider public comments before making a final decision to rely on a standard written by a voluntary standards organization. Once the agency uses this process to rely on a voluntary standard, the reporting and related enforcement provisions of §15(b) apply.  This process has rarely been used by the agency.  Why this is true is inexplicable to me. However, its use would have allowed the agency to quickly put in place a regulatory mechanism to address the risks associated with these products in a way that was consistent with the statute and that respected the due process considerations central to good regulatory practice.  Aside from being the right thing to do, it would also bolster the agency’s enforcement position in the (unlikely) event its actions are ever challenged. Instead, the agency acted by fiat to achieve the result §9(b) contemplates without bothering to follow the statute.

Some may argue that these products are so dangerous that the agency needed to act quickly and just could not be bothered to follow the law.  But again, the statute contemplates this type of imminent hazard situation and instructs the agency on the path to follow in such circumstances, a path that also includes due process protections. The statute was written to balance the public’s legitimate safety concerns with the public’s need for procedural protections to assure a just and fair result.  Hop-scotching over the statute, no matter the reason, is not something the federal government should do.

Saying Goodbye to Another CPSC Star

Several weeks ago, Neal Cohen, the CPSC small business ombudsman, called to tell me that he was leaving the agency.  Neal created the job of ombudsman and it turned out to be one of the most difficult and most under-appreciated but critically important positions at the CPSC.

The office of small business ombudsman was set up in 2010 in an effort to respond to the growing cries, especially from the small business community, that the agency’s regulations implementing the 2008 CPSIA statute were imposing a crushing burden on product sellers, notably small businesses.  When the office was set up, I argued that it should be a true ombudsman, bringing to the agency the concerns of small businesses as well as developing and advocating for solutions to the problems that community faced because of agency action.  Instead, the office was designed to be an outreach and education office—to help the small business community understand and comply with regulations.   While not fully meeting the true definition of an ombudsman, this still was a very important role, especially given the complexity of the rules the agency was in the midst of writing.  And Neal was just the right person to fill the position.

Over the past five years, Neal has worked tirelessly to make sure that businesses, especially small ones, understand their safety obligations as product sellers.  He has designed educational programs, given presentations throughout the country, answered thousands of emails and phone calls, and through that process, has helped the agency put a human and caring face on its work.  The latest achievement of his office, development of the Regulatory Robot, an on-line tool to help businesses understand what regulations they are subject to, will continue to be a testament to his dedication and hard work.

Whoever follows Neal in this role will have big shoes to fill but also a very good role model for how to get done a difficult but important job.  February 19, 2016 will be Neal’s final day at the agency. And as Neal leaves federal service to go into the private sector, no doubt he will come to understand even more the important public service he provided.


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