Tuesday, September 21, 2021

Critical Economic Assets and CFATS – Part 2

This is part of an on-going series of posts looking at the potential for an expansion of the effort of the Chemical Facility Anti-Terrorism Standards (CFATS) program to cover facilities that produce critical economic asset chemicals. The current CFATS regulations specifically allow CISA to declare a facility to be a high-risk facility covered by the CFATS program if they are a producer of critical economic asset chemicals.

The first post in the series looked at the historic background of this type coverage in the CFATS program and how DHS tried to look at the process.

The problem with the initial effort by DHS to look at this issue was that it took a scatter fun approach to determine if a particular reporting facility was a producer of more than 20% of the domestic production of a chemical. In this blog post, I will look at an alternative of identifying facilities that are producers of critical economic asset chemicals.

Identifying Critical Chemicals

The first thing that is necessary is determining what should be considered a critical chemical that could be used to define a critical economic asset. The CFATS regulations provide a first step in this by their definition in 6 CFR 27.105 of the term ‘security issue’ as “the type of risks associated with a given chemical.” That definition then goes on to list the three security issues used found in the DHS chemicals of interest (COI) list in Appendix A to the CFATS regulations, and then adds a fourth “Critical to government mission and national economy.”

The discussion in the preamble to the Appendix A final rule about the list of COI makes it clear that the Department only considered those chemicals for listing if they were “released, stolen or diverted, and/or contaminated, have the potential to create significant human life and/or health consequences.” This would mean that critical chemicals would not necessarily be included in Appendix A. What is probably needed is a new listing of chemicals that could trigger a reporting of the production or distribution of chemicals of economic interest (CEI), an Appendix B to the CFATS regulations.

CEI Designation

DHS, in crafting the CFATS Appendix A, was aided by the fact that there are a number of different regulatory lists that identify hazardous chemicals. Thus, DHS had a large universe of chemicals pre-defined that it could whittle down to a mere 300+ chemicals divided into three security issues that could help further refine the characteristics of the chemicals that would trigger the Top Screen reporting requirement. There are not such lists for easily defined chemicals of economic interest. So, DHS is going to have to start from scratch.

First, we are going to need an operational definition of the term ‘chemical of economic interest’. I would propose that the term would be defined as ‘a chemical which, if the supply of which was interrupted, would interfere with the completion of a government mission, or create significant economic and/or health consequences’. Identifying specific chemicals that meet that definition would be the next step.

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