Wednesday, July 28, 2010

Reader Comment 07-28-10 IST Rules

Jennifer Gibson from NACD responded to my post about their opposition to HR 2868 (as passed in the House). Read her entire comment but she agreed with me that IST assessments would only produce limited options for chemical distribution, making the point that the evaluation would not be cost effective. Then she stated that:
“I would like to clarify that both H.R. 2868 as passed by the House of Representatives and S. 3599 as recently introduced by Senator Lautenberg would in fact impose IST consideration requirements on chemical distributors.”
The point that I think that she, and most opponents of an IST consideration mandate, fail to realize is that while an assessment must be conducted, the law (as crafted) does not specify how that evaluation would have to be conducted. DHS would be responsible for crafting the regulations that describe those requirements. Furthermore, looking at how DHS has crafted the current CFATS program, it is rather obvious how the folks at ISCD would attempt to design the data collection and evaluation process. An IST tool in CSAT would be a series of on-line questions that facilities would respond to. There would be initial questions about the facility operations to determine how COI are used at the facility. The responses to those questions would lead to additional questions pertinent to that facility. For distribution facilities one could easily see that those questions would be limited to inventory level questions to track options for possibly reducing maximum inventory levels or dispersing the most hazardous chemicals in multiple, separated tanks to reduce the maximum potential release. Such information would be readily accessible to facility management. The cost of this type of ‘assessment’ would be reasonable. The inventory management controls necessary to implement such an IST would be a small additional burden, but those costs would also be relatively easy to estimate. Even estimating the cost of installing additional tankage, if there was room on the facility for a reasonable dispersion plan, would not be an overly costly exercise. It is certainly true that many chemical manufacturers could have a costly chemical and civil engineering task a head of them in evaluating potential IST possibilities for their facilities. Regulations supporting an IST consideration mandate would need to take into account the cost of the assessment, an extremely complex and expensive assessment process would only be justified for the highest risk facilities. But again, this is a consideration for the regulatory process not the legislative process. Keeping the difference between regulations and legislation in mind is an important concept. As HR 2868 moves toward the Senate floor industry organizations must realize that there will be further attempts to add IST language back into the bill. At least one Senator in today’s hearing mentioned his intention to introduce a floor amendment to require an New Jersey style IST consideration mandate. Such a mandate will probably be the minimum requirement to get House approval in conference. Actually, given the three year limit on HR 2868 (as amended today), it might make a great deal of sense for industry to support such a consideration mandate. This would allow industry and DHS to iron out the details of such a regulatory program in a way that would make the most sense. After all, no one can really argue that facilities should not take a serious look at the chemicals and processes they use with a view to reducing their risk, both from deliberate acts or accidental release. If a reasonable risk reduction can be obtained at a reasonable cost, it will only enhance the facility’s operations and profitability.

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