TSCA is the central law governing industrial chemicals in commerce. Passed in 1976, it gives the U.S. Environmental Protection Agency (EPA) broad authority to screen and regulate both new and existing chemicals. Many chemicals are subject to additional regulations based on their intended uses. Under TSCA, EPA has the authority to limit or prohibit the manufacture and distribution of a substance if it is found to pose an unreasonable risk.

A companion proposal in the U.S. House of Representatives, the discussion draft for the “Toxic Chemicals Safety Act of 2010”, was released the same day by Representatives Henry Waxman (D-CA) and Bobby Rush (D-IL). These long-awaited bills offer concrete targets for discussion and analysis in a political environment that has broad consensus for modernizing TSCA, but little consensus about the shape that modernization should take.

Stakeholder discussions are ongoing, but there is major disagreement between the two bills and the prospects for passage of the legislation during this term of Congress are probably low. With fewer than 20 weeks left in the congressional session, there may not be enough time to pass the bill through both the House and the Senate.

American Chemistry Council (ACC) president and CEO Cal Dooley said, “Safety must be the primary goal of chemical regulatory reform, as it is the top priority of our industry. This is a complex issue and we compliment Senator Lautenberg, and Congressmen Waxman and Rush, for bringing focus to the need for modernization of the law.”

Dooley added, “While TSCA has been protective of public health and the environment in the past, we should harness the scientific and technological advances made since its passage to assess the safety of chemicals while fostering innovation and preserving hundreds of thousands of American jobs. “

This complex legislation would make extensive changes to the industrial chemicals management framework in the United States. For the first time, chemical manufacturers, importers, and processors would be responsible for submitting a minimum data set for all chemicals in commerce and for establishing that their chemicals met a safety standard of “reasonable certainty of no harm,” according to the bill.

“We are encouraged that the Safe Chemicals Act (SCA) reflects some aspects of the principles that ACC released last year, which are mirrored by EPA’s principles,” said Dooley. “These include the need to prioritize chemicals for evaluation, a risk-based approach to EPA safety reviews, and a reduction in animal testing.” 

But the chemical industry is concerned that the bill’s proposed decision-making standard may be legally and technically impossible to meet. The proposed changes to the new chemicals program could hamper innovation in new products, processes and technologies. In addition, the bill undermines business certainty by allowing states to adopt their own regulations and create a lack of regulatory uniformity for chemicals and the products that use them.

Under the proposed bill, the EPA would be required to prioritize, evaluate, and manage new and existing chemicals in tight timeframes. EPA’s authority to impose restrictions and conditions on existing chemicals would be greatly enhanced, particularly by its ability to impose such conditions in its safety determinations. Confidentiality provisions would be narrowed, while EPA’s authority to order data production and testing would be expanded.

These and numerous other proposed changes to the legal framework would modernize various dimensions of TSCA, but would also impose substantial new burdens on both industry and EPA.

Our industry supports tiered (phased) testing approaches that use results-based prioritization to focus testing on chemicals of greatest concern to public health, thus reducing the total amount of testing and animal research necessary to protect public health. To this end, we support using hazard and exposure data to prioritize substances for further evaluation, which provides more efficient use of resources.

The products of chemistry are among the most thoroughly evaluated and regulated in commerce. Chemicals are developed, manufactured, distributed and used under a strict and comprehensive set of government rules found in more than a dozen separate federal laws.

The chemical industry is committed to enhancing the way chemicals are managed in the U.S., and TCC member companies go to great lengths to ensure their products are safe for their intended uses.

Each year, the seminar is organized by a committee of dedicated volunteers who work for TCC and ACIT member companies, government regulatory agencies, universities, safety councils, and other organizations and friends of the chemical industry.For an article about the evolution and history of the EHS Seminar, visit the TCC home page: http://www.txchemcouncil.org/

We invite you to attend the TCC/ACIT EHS Seminar at Moody Gardens Hotel and Conference Center in Galveston, TX, from June 7 to June 10. For information about the conference, speakers, exhibitors, tracks and topics, click here: http://ehs-seminar.com/.

 “This is good news for Houston-area citizens, who will be spared the threat of new federal regulations that could burden economic recovery and development,” said TCEQ Chairman Bryan W. Shaw, Ph.D.  “The TCEQ saw the possibility that PM_2.5 levels at one particular monitor could some day exceed federal requirements, and took proactive steps to reduce levels and prevent that from happening.”

There are three PM_2.5 monitors in Houston, but only the Clinton Drive monitor, located in an industrial area near the Ship Channel, showed elevated readings. Electron microscopy showed that a large portion of the Clinton monitor samples consisted of soil and dust particles.

To reduce PM_2.5 levels, the TCEQ enlisted the aid of the EPA; the City of Houston; Harris County; Port of Houston Authority; Port Terminal Rail Authority; and local industry.  A nearby parking lot was paved; barriers were installed to prevent trucks from driving on dusty shoulders; new, cleaner railroad engines were put into service; and many other actions were taken, including voluntary dust reductions from industry and enhanced dust suppression requirements. 

“We were pleased and thankful that we received such meaningful cooperation from so many organizations in the Houston area,” said TCEQ Commissioner Buddy Garcia. “It shows what can be accomplished when everyone works together toward a common goal.”

The PM_2.5 levels at the monitor came down, from the highest annual average reading of 16.0 micrograms per cubic meter to the latest average of 12.6 micrograms per cubic meter. Overall PM_2.5 averages in Houston also declined, from 13.2 micrograms per cubic meter to 11.9 micrograms per cubic meter. The federal standard for PM_2.5 is 15.0 micrograms per cubic meter.

“This is just the latest news in the positive trend in Texas air quality,” said TCEQ Commissioner Carlos Rubinstein. “Houston is meeting federal ozone standards for the first time, air toxics levels are coming down, and these good air quality stories are happening all over the state.”

Another important factor in the reductions is that the EPA recognized that many high monitor readings were caused by exceptional events that Texas does not control, such as smoke from agricultural burning in Central America and fine dust from Saharan dust storms.  Readings were adjusted accordingly.

Due to these changes to reduce dust in the area, and further restrictions on maritime and industrial emissions, the levels should continue to decline.

Following meetings with federal regulators last month, TCC Vice President and General Counsel Christina Wisdom submitted the following letter to EPA Region 6 Administrator Dr. Al Armendariz on April 30: http://www.txchemcouncil.org/categories/Committees/Air-Conservation/Items-of-Interest/

EPA issued a guidance document on January 5 stating that an area attaining either the 1-hour or 1997 8-hour ozone NAAQS, would no longer be obligated to submit a fee program SIP revision, and that “an area’s existing SIP should be considered an adequate alternative program.”

TCC pointed out that Houston’s air quality has improved dramatically in the last 20 years, and TCEQ’s monitoring data shows that Houston-Galveston-Brazoria (HGB) nonattainment area monitors demonstrate attainment with the 1997 8-hour ozone standard on average over the past three years (2007-2009).TCEQ can prove that these remarkable improvements in air quality in the HGB nonattainment area are due to reductions in emissions, resulting from the Texas SIP and applicable air pollutant control regulations.

TCC argued that TCEQ should move quickly to submit the request determination that the state is no longer obligated to submit a Section 185 fee program to satisfy the anti-backsliding requirements associated with the transition from the 1-hour standard to the 1997 8-hour standard.

“As CEOs have noted for the sixth year in a row, Texas continues to be a model for the nation as the best state to live and do business,” Gov. Perry said. “This top ranking by Chief Executive Magazine proves that our low taxes, reasonable and predictable regulatory climate and skilled workforce have not gone unnoticed.”

The survey asked 651 CEOs to rank each state based on three general categories: taxation and regulation, quality of workforce and living environment. States were then evaluated based on five subcategories and ranked by importance to the respondent.

The study noted that Texas scored high in all areas valued most by the CEOs, who mentioned Texas’ tax credits and business incentives as reason to relocate or expand a business in Texas, highlighting the Texas Enterprise Fund as the largest deal-closing fund of any state.

“Texas is pro-business with reasonable regulations,” said one CEO. Another CEO noted, “You feel like state government understands the value of business and industry to create jobs and growth.”

The Lone Star State is the 12th largest economy in the world and has created more private sector jobs in the last 10 years than any other state in the nation. No state has more Fortune 500 company headquarters than Texas. Additionally, Texas is the top exporting state in the nation for the eighth year in a row, and has the second lowest tax burden in the country. 

To view the survey results, click: http://www.chiefexecutive.net/ME2/Audiences/

To view the survey’s historical rankings, click: http://www.chiefexecutive.net/Media/BestAndWorstStates/2010/CEStateRanks.aspx

Honeywell expressed its commitment to continue doing business in Texas by announcing the completion of multi-million dollar rebuilding project.

“Through the hard work and dedication of Honeywell employees, our Orange facility and the surrounding Orange community is even stronger than before Hurricane Ike,” Honeywell Specialty Materials President and CEO Andreas Kramvis said. “We are looking forward to continuing to serve our specialty additives customers from our Orange facility for many years to come.”

The Honeywell facility in Orange is part of Honeywell Specialty Materials, which is a global leader in providing customers with high-performance specialty materials, including fluorine products; specialty films and additives; advanced fibers and composites; intermediates; specialty chemicals; electronic materials and chemicals; and technologies and materials for petroleum refining.

Most analysts had expected the industry’s powerhouses to report improved margins, higher pricing and an uptick in consumer demand for the January-to-March period.

However, fluctuating raw material costs have been a concern. The cost of crude oil rose 5.2 percent during the quarter, while natural gas costs fell 32.2 percent.

Those fuels are important base materials that the industry uses to make ethylene, propylene, ammonia and other products. Those in turn are used to make thousands of everyday items, including carpets, paint, shoes and raincoats. But unlike energy price run-ups in 2008, chemical makers appear ready for increases this summer.

“The chemical companies have gotten much better at announcing and passing through selling price increases to customers,” Deutsche Bank analyst David Begleiter said.

And chemical industry merger and acquisition (M&A) activity may be set for a major rebound in 2010, driven by pent-up demand from cash-rich companies, according to an industry analyst.

“Strategic buyers, armed with balance sheets flush with cash, are seeking ways to accelerate growth beyond their organic means,” said BB&T analyst Frank Mitsch in a research note.

The amount of cash on the balance sheets of 15 US chemical companies under coverage by BB&T reached a decade-high of $8.3bn in 2009 – 60% above 2008 levels, he noted.

“With many players on the sidelines in 2009, we believe there is notable pent-up demand that is just waiting to be executed on in 2010,” said Mitsch.

With consolidation a key driver of M&A activity, companies in the fragmented markets of coatings and adhesives – such as Valspar, RPM International and HB Fuller – could appear on radar screens of buyers.

In addition, companies emerging from bankruptcy such as Chemtura, WR Grace, LyondellBasell, Solutia and Tronox could be potential targets, along with companies with focused portfolios such as Arch Chemical and Nalco (both in water treatment), he added.

Leveraged buyouts (LBOs), which disappeared in 2009, could also be on the comeback. “As earnings have elevated from the abysmal 2008 to early 2009 levels, private equity firms are increasingly able to justify valuation multiples,” Mitsch said.

Mitsch said his top LBO candidate was US-based phosphates company Innophos. A buyout could be feasible at nearly twice the company’s current share price of around $30 based on various cash flow metrics, he said. Other LBO candidates included Eastman Chemical and PolyOne.

Senate Majority Leader Harry Reid (D-NV) has promised to have the EPA study “well in hand for the debate” on the sweeping bill, which would curb greenhouse gas emissions across the U.S. economy.

Typically, EPA’s work takes about six weeks to complete, which means Reid cannot expect to start a floor debate until at least after lawmakers return from their Memorial Day recess in early June.

In addition, the U.S. Energy Information Administration (EIA) will take up to eight weeks to analyze the stalled Senate climate bill after receiving most of its details from the office of Senator John Kerry. Elements of the bill were delivered to the EIA both verbally and by hard copy.

“We received details. It's not a copy of legislation, but it was specific enough to allow us to go forward with our modeling efforts,” said Jonathan Cogan spokesman for the EIA, the independent statistics arm of the Department of Energy.

Because of the way it was delivered, some stakeholders such as environmentalists and utility lobbyists are openly wondering if the bill is complete, despite six months of work on it by Kerry, a Democrat, Senator Lindsey Graham, a Republican, and Senator Joseph Lieberman, an Independent.

Kerry also has been careful not to commit any of the bill’s details to paper but some of its key features have been leaked by sources.

Previously, government agencies have found the impact of climate legislation on consumers to be negligible. The EIA found last August that a bill passed in the House of Representatives would raise household costs about $134 in 10 years.

Details of the Kerry plan on how to tackle emissions from the transportation sector, and how permits would be distributed to power companies, are still unclear. Sending the bill to the agencies for analyses before it has been publicly revealed could help lawmakers with time running short before elections in November.

Barring any changes in the legislation that would set back the EIA, the climate bill could be on the Senate floor in June at the earliest, but more likely in July. That assumes political differences are ironed out and Kerry moves forward with the bill. The Congressional Budget Office is also likely to conduct its analysis of the bill.

His comments came just five months after the Copenhagen climate conference failed to yield much progress despite efforts by world leaders, including President Barack Obama.

De Boer said the next major U.N. climate conference in Cancun, Mexico, in December will “not provide an answer that is good enough.” He was speaking to reporters at an international climate meeting in Koenigswinter, Germany.

“A good outcome of Cancun will be an operational architecture on climate change,” he said. “And then we can decide on a treaty.”

De Boer said he expects such an international climate treaty before the end of 2012, but even that will “not be the definitive answer to the climate change challenge.”

Originally, the Copenhagen conference was intended to produce the international treaty that has been in the works since 2007. Instead, it showed a great rift between industrialized nations, new economic powers like China, and developing countries.

Germany and other countries have said they have not given up on a deal in Cancun. Germany and Mexico were hosting the meeting in Koenigswinter of more than 40 ministers and high representatives, which is aimed at getting the U.N.’s negotiating process back on track.

In Copenhagen, nations did agree that global temperatures must not rise above 3.6 degrees Fahrenheit in comparison with preindustrial times. In order to achieve this, scientists say industrialized countries need to cut their emissions of heat-capturing gases such as carbon dioxide by 25-40 percent compared with 1990 by 2020, and developing countries must enter a low carbon path.

De Boer said industrial nations have started to act, but are not yet doing enough. “I don't think we will get enough of an answer in Cancun to get us to the 25-40 range,” he said.

Also, while nations in Copenhagen agreed on a fast-start $30 billion financial aid package, poorer nations need assurances that this package actually consists of new and additional funds, he said. By 2020, the annual help needs to be shored up to $100 billion and richer nations need to say how they are going to do that, he said. “There will be no action without a great deal of funding,” he said.

Those interested in chemical toxicity can query a specific chemical and find all available public hazard, exposure, and risk-assessment data, as well as previously unpublished studies related to cancer, reproductive, and developmental toxicity.

The EPA said ToxRefDB is part of ACToR (Aggregated Computational Toxicology Resource), an online data warehouse that collects data from about 500 public sources on tens of thousands of environmentally relevant chemicals, including several hundred in ToxRefDB.

The database captures over 30 years and $2 billion of animal testing results. It also connects to EPA’s chemical screening tool called ToxCast, a multi-year, multi-million dollar effort that uses advanced science tools to help efficiently understand biological processes impacted by chemicals that may lead to adverse health effects.

“Tens of thousands of chemicals are in commerce and current chemical testing is expensive and time consuming. Results from chemical testing are scattered throughout different sources,” said Dr. Robert Kavlock, director of EPA's National Center for Computational Toxicology. “ToxRefDB allows the public to search, find and compare available studies about chemical toxicity and potential health effects.”

The EPA website can be found by clicking here: http://actor.epa.gov/toxrefdb/faces/Home.jsp;jsessionid=E1D8718053D139E3339EC12BEADF2B79

• AmeriTrac Railroad Services

  Art Colwell of BASF, Gary Hockstra of Dow and Tom Rich of ConocoPhillips

• Austin Industrial, Inc.
• AXion Logistics, LL
• DMC – Carter Chambers
• Dow Chemical
• EPSCO International
• GHX Industrial – The Gasket and Hose Resource
• JV Industrial
• Nalco Company  
• Safway Services, LLC
• Waco Filters 

More photos of the ACIT Mid-Coast Economic Outlook Breakfast can be found here: http://www.flickr.com/photos/chemicalcouncil/sets/72157623891961462/

• Aggregate Technologies AWC
• Axion Logistics
• Bradley's Motors
• Chem Fabrication
• Evergreen Tank Solutions
• Flare Ignitors Pipeline & Refinery
• GHX Industrial, Inc.
• Infinity Construction Group
• KMAC Specialty Services Lamons
• LISCO Valve
• McGill Maintenance Partnership
• Miken Specialties
• P.A. Inc.
• Reliable Turnaround Services
• S&B Engineering
• Skyline Technologies
• Testronics
• The Eads Company
• The Mundy Companies
• TIC
• Tower Performance of Texas
• Waste Connections
• Wholesale Electric
• Zachry Industrial

More photos of the ACIT Mid-Coast Region Golf Tournament can be found here: http://www.flickr.com/photos/chemicalcouncil/sets/72157623891990324/

May 20^th – ACIT Houston Ship Channel Crawfish Boil and Mixer at Bridge Water in Baytown.  For more information, go to the following link:http://www.acit.org/articles/425/1/ACIT-Houston-Ship-Channel-Crawfish-Boil-amp-Mixer---May-20-2010/Page1.html.

June 7^th through 10^th – Registration is now open for the TCC/ACIT EHS Seminar, to be held at Moody Gardens in Galveston. For more information or to register, please click here.

June 10^th - TCC/ACIT Awards Banquet at Moody Gardens in Galveston.  For more information, go to the following link (Mike, this is for ACIT newsletter):http://www.acit.org/articles/337/1/TCCACIT-Awards-Banquet---June-10-2010/Page1.html

This is for the TCC newsletter:http://www.txchemcouncil.org/articles/682/1/TCCACIT-Awards-Banquet---June-10-2010/Page1.html

June 24th – ACIT Houston Ship Channel Clay Shoot at the American Shooting Center in Houston.An announcement will be sent out at a later date.

June 25^th – ACIT South Texas Golf Tournament at the River Hills Country Club in Corpus Christi.An announcement will be sent out at a later date.

August 19^th & 20^th – The 4^th Annual Maintenance & Reliability Symposium “Improvement in Maintenance & Reliability – Leading the Recovery” to be held at Moody Gardens in Galveston.  For more information, please click here.