Posts Tagged 'burden reduction'

Steps Forward; Steps Back

Now that August is over and Labor Day is but a memory, it is time to focus on how the twostepsforwardCPSC spent the closing days of summer.  On a positive note, the agency was able to push forward helpful initiatives that ease compliance costs without diluting safety.  Then they had to put a damper on this positive glow with threats of resurrecting the discredited and flawed proposals dealing with voluntary recalls and public information (the §6(b) rule).

Forward Steps

The recently published NPR interpreting the fireworks rule is one of those steps forward.  The fireworks regulation has been on the books for several decades and is sorely in need of updating.  Among many other things, the regulation is designed to address overloaded fireworks but does so in a less-than-straight-forward manner.  It bans fireworks “intended to produce audible effects” if those “audible effects” are produced by using more than 2 grains of pyrotechnic composition.  Rather than measure the pyrotechnic materials in the fireworks device to determine compliance, for years the staff has listened for the intensity of the sound produced by the device to determine if it was intended to produce audible effects or whether the sound produced was merely incidental to the operation of the device.  The staff’s determination as to how loud the device was, based on what a staffer heard, was hardly either objective or measurable and has resulted in compliance actions that have been criticized for lack of objectivity.

The American Pyrotechnic Association has a standard that actually measures the presence of materials that may be used to produce an audible effect.  The APA standard has been adopted by the Department of Transportation regulations that deal with the shipment of fireworks.  The proposal, which has been pushed by Commissioners Robinson and Mohorovic in particular, would adopt the APA standard as the testing measure for the CPSC as well. An objective standard would add clarity both for the staff who must make compliance decisions, and the industry which can stop worrying that compliance is dependent on a staffer’s ear.

Another example of a “step forward” is a proposal determining that four types of plastics used extensively in children’s products do not need to be tested for the presence of phthalates.  This proposal would put into action what product manufacturers have been telling the agency for some time—phthalates are not added to these substances and so testing for them both is unnecessary from the standpoint of safety and is costly and burdensome.  This proposal, which has been a long time in the making, compliments the flexibility found in the 2009 statement of policy on phthalates testing and, hopefully, should provide some relief to a number of manufacturers and importers.

Backward Steps

However, the Commissioners could not end the summer on a positive note.  Instead, on the last day of August, the Commissioners met to talk about their regulatory priorities for the upcoming fiscal year.  Observers of the agency are well aware of the controversy engendered by the agency proposal to significantly change the way voluntary recalls are negotiated and agreed to.  Similarly the proposed changes to §6(b) dealing with how information about individual products is made public would distort the statute and surely subject the agency to needless litigation. I have discussed the problems with these proposals in detail, and the Congress has told the agency to cease and desist.

Chairman Kaye has repeatedly expressed his lack of interest in moving forward with these two troublesome proposals.  However, each time he has been given the opportunity to vote to remove them from the agency’s regulatory priorities list, he has refused to do that.  At the recent priorities hearing he was given yet another chance to do that and he did not step up.  Instead, Commissioner Adler, a staunch foe of §6(b) and a supporter of the voluntary recall rule, announced that he would be trying to draft a “compromise” to offer at some unknown point in the future (and not specifying if that would be before or after the elections).  For those who thought that perhaps these two ill-conceived proposals were behind you, do not be so sure.  Commissioner Adler’s gambit may provide the excuse 3 Commissioners need to defy logic, good public policy and the Congress to promulgate these divisive and poorly thought-through rules.

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EU-U.S. Regulatory Cooperation: Strides Made but More Should Be Done

Today the George Washington University Regulatory Studies Center released a significant report, “International Regulatory Cooperation:  Benefits, Limitations, and Best Practices.”  This report builds on earlier work done by the Center and examines opportunities to improve regulatory cooperation between the European Union and the United States.  The report is timely because negotiators from the U.S. and the EU this week are continuing their discussions to hammer out the Transatlantic Trade and Investment Partnership (TTIP) agreement.

The study examines the efforts of three federal agencies to foster regulatory cooperation, including a case study on the efforts of the CPSC, which I authored.   The case study builds on my experiences over an eight-plus year time span as a CPSC Commissioner, when I saw first-hand the need for collaborative efforts among jurisdictions internationally to address the issue of import safety. The study looks at the potential benefits of and the limits of and barriers to regulatory cooperation.  I also have made recommendations for changes that I believe would improve the agency’s ability to work with its foreign counterparts to improve safety.  The report identifies ways to reduce unnecessary regulatory divergences (and related wasteful regulatory costs) such as convergence on testing and standards, sharing of data and more active consideration of unnecessary differences when promulgating or reviewing regulations.

The CPSC has a good track record working with its foreign counterparts to enhance consumer safety. However, given the complexity of both consumer products and the global marketplace, consumer safety will demand even greater and more creative work among regulators but that work needs to minimize the unnecessary regulatory burdens that come from an unimaginative approach to regulation.

I would welcome feed-back to the recommendations made in this report.  Give me your comments here or at nnord@ofwlaw.com.

Summer Reading

August is here, Congress is leaving town and it is time to settle in by the pool for a good read.  Let me recommend a few Woman-Reading-By-The-Poolthings.  For those looking for something light and frivolous, I recommend the CPSC’s proposed direct final rule instructing that only those toys made from the trunks of trees (Just the trunks?  Really?) will be exempt from pre-sale testing for heavy metals.

However, for a more thoughtful perspective not only on this rule but also on the overly-constrained approach a majority of Commissioners have adopted to trying to provide relief from its overly burdensome testing rules, I recommend Commissioner Mohorovic’s statement accompanying this rule.  He has rightly pointed out that the Commission has framed its work on burden reduction in such a way that real, meaningful results—that reduce costs without compromising safety—will be almost unachievable.  As the Commissioner states, where testing costs add a safety value then those costs are worthwhile, but where testing is required for the point of testing, as is the case under the CPSC’s current approach, then valuable safety resources are being squandered.

To further round out your CPSC reading list, be sure to check out the CPSC Commissioners’ blogs.  You can find them on the agency web site. I was so pleased to see that the Commissioners now are able to post blogs on the web site. This was not true back in 2009 when I started “Conversations with Consumers.”  To write and post a blog I had to go outside the agency and set it up privately.  Check out the Commissioners’ blogs from time to time to get a sense of what issues are of special interest to the leaders of the agency.

Defining “Wooden-Headedness”

In The March of Folly, historian Barbara Tuchman writes:

Wooden-headedness, the source of self-deception, is a factor that plays a remarkable large role in government.  It consists of assessing a situation in terms of preconceived fixed notions while ignoring or rejecting any contrary signs.  It is acting according to wish while not allowing oneself to be deflected by the facts.

Late last week the CPSC Commissioners voted to write Ms. Tuchman’s definition of “wooden-headedness”  into the Code Le_avventure_di_Pinocchio-pag046of Federal Regulations by issuing a direct final rule to give long-awaited “relief” from the burden imposed by its third party testing rules as directed by Congress way back in 2011[1].

The Commission has been promising relief from its burdensome testing requirements but has been doing everything it can to avoid doing anything since 2011 when Congress first directed it to take action.  Now after four years of study and promises to Congress (even as recently as last month), the Commission has found [INSERT LOUD DRUM ROLL HERE] that toys made from unfinished and untreated wood from the trunks of trees do not have to be tested for the presence of seven heavy metals regulated by the toy standard.

The Commission’s action last week is justified by a contractor’s study which is itself a study in the precautionary principle run amuck.  The contractor was tasked with doing a literature search looking at the same natural materials (untreated wood, fibers such as wool, linen, cotton or silk, bamboo and beeswax among other things) which the Commission exempted from testing for lead back in 2009.  Yet only for trunk wood was the contractor able to report sufficient data to show no presence of the suspect heavy metals in concentrations that violated the toy standard.  For most of the other materials there was insufficient evidence reported to show the absence of violative concentrations of the heavy metals. The contractor, however, did find that a report that wool from sheep dipped in arsenical pesticides (which are no longer used) had high concentrations of arsenic as did wool from sheep grazing next to a gold smelting mine.  In other words, if the contractor, in doing its literature search, found a study documenting a problem, then the material was disqualified.  If the contractor could not find a study documenting a problem, the material was also disqualified on the basis of insufficient information.

Back in 2009, the agency staff was able to make rather more expansive determinations quite quickly and efficiently, without expensive contractor studies, and to my knowledge, public health and safety has not been threatened by this action.  The current agency action seeks to take the smallest, most ineffectual step possible and then point to a constrained reading of the statute and an inconclusive contractor study to justify inaction.

Congress told the agency to take action to reduce testing burdens or report back if statutory impediments required Congressional action.  The agency has done neither.  Instead, the Commission, on several recent occasions, has promised Congress that action on test burden reduction will be forthcoming.  One hopes that limiting testing exemptions to toys made from tree trunks is not what the Commissioners had in mind when those statements were made.  It is hard to believe that Congress will find this a satisfactory response either.

So if you use bamboo or perhaps linen or beeswax in crafting your toy, you are out of luck because there is no evidence these materials are unsafe.  For those small businesses out there who might make a toy from a tree limb or decorate the toy with bark or twigs, you are also out of luck!  And if you are looking for clarity, too bad.  As one of my friends in the small business community said when she heard about this, “Is a branch 12 inches in diameter a trunk? Do I need to ask the lumber yard if the wood came from a trunk? Will they even know? Will I need to have proof the wood came from a trunk?  It just comes across as comical.  Is there value in this determination?  I suppose, but for many it is just too little, way too late. Four years late to be exact.”

The fact is that public health is not impacted by toys that include components of natural materials—the agency’s experience with lead has shown that.  Indeed, the natural materials exemption is a very narrow one and hardly opens the flood gates to testing avoidance. One must ask why the agency is so adverse to finding a workable solution to reducing testing burdens.  Wooden-headedness brings about wooden thinking.

[1] Direct final rules are reserved for those rules that are noncontroversial, and usually deal with routine, narrow or non-substantive matters. They go into effect unless someone objects.  In this case the rule, and the testing relief it proffers, could not be more narrow.

The Real World Speaks; The Government Does Not Hear

Last week I traveled to St. Louis University to speak to students attending the school’s Product Safety Managementst-louis-cityscape Course.  This executive education course is presented by the Center for Supply Chain Management Studies at the Cook School of Business at the University and is unique in presenting a concentrated focus on product safety-related issues.  I was asked to discuss how the CPSC is organized and how agency policy and decisions get made and I discussed my perspectives, as a former commissioner, on the agency’s seemingly more contentious and less collaborative approach to product safety.

The class was made up of professionals from small, medium and global businesses with backgrounds that included law, engineering, business and science. The joy of opportunities like this is not only having several hours with engaged and very smart professionals in the classroom, but also having time outside of class to interact informally.  While I hope I imparted knowledge, I know that I learned a great deal.

Boiling it down to a sentence, here was my message to the class:  The CPSC is moving to more aggressive and expansive regulations and more aggressive and punitive enforcement.  For companies that want to stay out of the agency’s sights, they should consider, among other things,

  • implementing strategies to update and fine-tune their compliance programs;
  • making sure that they have appropriate written procedures for addressing safety complaints and can demonstrate those procedures are followed;
  • having and being able to show good control over their supply chain;
  • keeping good records to show a testing program, test results and compliance with applicable regulations; and
  • registering for the Business Portal of the Public Database as one device to know what some consumers are saying about their products.

Of course, safety must always be a core value of the company, and at all levels, including senior management.  Unless that is true, none of these efforts will be truly effective in minimizing a company’s exposure.

I also learned a great deal from the students.  One message especially resonated since it came from several different class members from different types of companies.  These students described the importance their companies placed on regulatory compliance in the face of very constrained resources.  They described the challenges of complying with different regulatory approaches to addressing the same risks, on local, state, national and international levels.  They described different testing methods to measuring compliance—tests mandated by regulatory bodies in the U.S and abroad and by cautious retail customers who want to assure that the CPSC does not appear on their doorstep and have the market power to make those tests happen—with all these tests differing one from the other.  The complaint I heard was that there is an expectation of compliance with no realistic understanding of the level of resource needed for full compliance, given the complexity of the myriad rules that have now been issued.  Nor is there any effort, or feeling of responsibility, on the part of the government to simplify those rules to make them less burdensome so that compliance can be more realistically achieved.

Bottom line from my Midwest journey:  The real world speaks but the government does not hear.

Happy (?) Birthday

Perhaps someone, somewhere celebrated the 6th birthday of the CPSIA 10 days ago, but it sure blew right by me.  It took the Product Safety Daily publication to remind me that it had occurred. ?????????????????????????????????????????????????????????????????????????????????

The American Apparel and Footwear Association posted a short, thoughtful blog about the significance of the CPSIA’s anniversary, noting that the law did achieve some important safety benefits but not without some very significant and unnecessary costs.  And it is my position, as a commissioner who lived through the internal debates at the agency, that the CPSC was complicit in exacerbating those unnecessary costs and complexities.  The good things in the law could have been achieved without the heavy toll extracted.  That the agency has not moved to reduce testing burdens as instructed by Congress is either regulatory incompetence or arrogance run amuck.  But I repeat myself.

Testing Assumptions

This week I had the pleasure of speaking to the leadership and staff of the American Association for Laboratory Accreditation.  The association accredits third party testing laboratories to a wide range of standards including, but not limited to those issued by the CPSC.  My presentation was an opportunity to discuss how the agency has implemented the CPSIA with a special focus on the agency’s testing requirements.  However, this was also an opportunity to have a free-wheeling conversation about the role that testing and testing laboratories play, and should play, in product safety.

I asked these experts whether third party testing of children’s products was the most effective way in all cases to assure regulatory compliance.  Interestingly, these representative of the testing laboratories agreed that while third party testing is the most expensive compliance tool, it is not always the most effective tool.  They pointed to the EPA’s green appliance regulations as an example of an effective regulatory regime that does not mandate third party testing. They pointed to NIST’s accreditation of first, second and third party testing laboratories to make the point that it is possible to oversee the integrity of in-house testing.

I pointed to the rule to require warning labels on slings—cloth infant carriers—that the agency plans to proposed next week, asking whether sending slings to a third party testing laboratory to “test” whether the label was correct was an efficient use of resources.  While the audible answer was “probably not”, judging by the body language of the folks in the room, the real answer was “are you kidding me?!”

I asked these experts about whether testing variability occurs among different labs or within the same lab.  The answer I got was “Of course it exists.  Everyone knows that.”  Apparently, everyone but the CPSC. This is an issue I tried to get the agency to address when I was a Commissioner but agency leadership was steadfast in refusing to even see lab variability as an issue.

We talked about the feasibility of laboratories discounting prices to small businesses who are suffering mightily under the burden of CPSC-required testing.  Commissioner Adler has suggested that laboratories do that since the testing requirements of the law and the CPSC regulations have provided laboratories with such a business windfall.  The conclusion of these experts was that this is not a workable option for a wide variety of reasons.

However, we did talk at some length about the role testing laboratories could play in assuring that testing resources are directed at those products that pose the greatest risk and are not wasted on unnecessary testing.  I challenged the industry to participate constructively in suggesting ways to reduce testing burdens beyond the rather unimaginative actions now being taken by the CPSC. While the industry may experience some short-terms gains by a system that requires excessive and burdensome third party testing, everyone, including testing laboratories, benefits from a system that deploys resources efficiently and reduces the costs that product sellers (and consumers) pay to assure safety in the marketplace.

 


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