HR 6992 Recognition Program – CFATS Reauthorization

As I noted in an earlier post HR 6992, the House version of a Chemical Facility Anti-Terrorism Standards (CFATS) program reauthorization bill, made some changes to the CFATS Recognition Program introduced in S 3405. It is not yet clear (since the Senate Homeland Security and Governmental Affairs Committee have not yet published their report and amended version of the bill) whether this new language will also be reflected in the reported version of the Senate bill.

Definitions

Section 4 of the bill (as does §5 of S 3405) adds a new subparagraph (5) to 6 USC 622(c). HR 6992 adds two additional definitions, and excludes a definition found in the Senate bill. The first new definition is for the term ‘participating facility’ which is defined as “a covered chemical facility that is a member of a participating industry stewardship program” {new §622(c)(5)(A)(ii)}.

HR 6992 does away with the definition of ‘industry stewardship program’ and substitutes instead ‘participating industry stewardship program’. That term is defined as an industry stewardship program that {new §622(c)(5)(A)(iii)}:

• Meets the eligibility requirements under subparagraph (C)(i); and

• Provides regulatory recognition to covered chemical facilities that meet industry best practices.

 

Compliance Requirements

The new §622(c)(5)(C)(ii) from both bills provides the performance requirements for facilities participating in the CFATS Recognition Program, but there are significant differences in language of the two subparagraphs.

The House bill provides two new reporting requirements for the sponsoring industry organizations. These establish a requirement for the organization to ‘promptly report’ when an participating facility ceases to be{§622(c)(5)(C)(ii)(II)}:

• A member in good standing of the participating industry stewardship program; or

• In full compliance with the requirements of the participating industry stewardship program.

The House bill also completely removes the program description requirements found in the new §622(c)(5)(C)(ii)(II) proposed in the Senate bill. Those requirements were near duplicates of the program criteria established earlier in the new §622(c)(5)(C)(i) in both bills.

Incentive Exceptions

Section 5 of the Senate bill establishes a program of incentives to encourage facility participation in the in the CFATS Recognition Program and §4 of the House bill makes some significant changes to those incentives. First, it removes the Tier reduction incentive provided for in the Senate bill. Then it adds two exception conditions to the reduction in inspection frequency provisions of the Senate program. Those exceptions are {new §622(c)(5)(C)(iii)(I)(aa)(AA)}:

• In the case of any inspection relating to any planned measure in the site security plan of a participating facility that has not been fully implemented; or

• In a case in which a participating facility is not in full compliance with the requirements under the Chemical Facility Anti-Terrorism Standards Program;

Implementation Requirements Erased

The House bill also completely does away with the ‘implementation’ requirements found in the new §622(c)(5)(D) in the Senate bill. Those requirements set forth:

• How stewardship programs would apply to participate in the CFATS Recognition Program;

• How the Department would respond to those applications; and

• How stewardship programs could submit revised applications for program denied participation.

Commentary

Michael Kennedy, a lawyer long involved in the CFATS program, has an interesting article over at SecurityInfoWatch.com about the CFATS reauthorization process that includes both HR 6993 and S 3405. Since Michael has been involved in much of the behind the scenes negotiations between industry and committee staff on these two bills, his comments are inciteful and cogent.

Towards the end of the article he makes an important point about the CFATS Recognition Program:

“Because many of these recognition programs, commonly referred to as industry stewardship programs, are closed to the public, security consultants could be forced to work closer with or even become dues paying members of various trade organizations, such as the American Chemistry Council, Association of Chemical Distributors, Agricultural Retailers, the Society of Chemical Manufacturers and the Fertilizer Institute – all of which support the measures – in order to access these programs and properly advise their clients.”

Another point that Congress needs to keep in mind is that wide spread use of these recognition programs will reduce congressional oversight capabilities over the implementation of the CFATS programs. Rather than having a one-stop shop for information about inspection processes, inspector qualifications and site security plan implementation details, congressional investigators will have to dig into the processes at multiple private organizations.

This recognition program could also exacerbate the inconsistency problems that some in industry are complaining about. While the current CFATS program has a certain (certainly inevitable) level of inconsistent application due to how individual chemical security inspectors interpret security guidance form the Director this will certainly expand when security program managers at different industry stewardship programs interpret that guidance from the DHS Infrastructure Security Compliance Division. I doubt that industry will complain about those inconsistencies since most facilities would have the option to shop different organizations to find the most compatible (less costly) implementation for their facility.

Of course, the details are in the DHS implementation of the program. The language in the House bill provides ISCD with the wider latitude in establishing the program. In the long run, with the further opportunity for open industry, labor and activist community involvement in the process of writing of the regulations, I think that the House language for the program is the better bet.