POLICY (SECTION 2)

Section 2(b) (1) should be amended to require testing only of those chemical substances which are likely to pose an unreasonable risk to health or the environment. We do not believe that maximum testing of all new chemical substances is a practical or viable way to protect the public.

DEFINITIONS (SECTION 3)

The definition of "Test Protocol" is unduly restrictive in that it requires ". . . a standardized procedure for performing tests. . .". The science of toxicology is dynamic and progressive and new and more effective techniques of performing toxicity tests are constantly being developed. The Administrator should not be required to impede this development by so specifically prescribing test procedures. We suggest that the word "standardized" be deleted and the word "acceptable" be substituted or the words "acceptable to the Administrator".

TEST STANDARDS (SECTION 4)

We believe qualified toxicologists can reasonably predict or identify those kinds of substances that are likely to pose health or environmental problems from their knowledge of the effects of known chemicals, radicals, etc. The absence of a large and continued number of instances where the normal use of chemicals caused adverse health or environmental effects which were previously not known or predicted compared to the vast number of chemicals being used, indicates that industry is doing a responsible job of voluntary testing.

In order to more effectively protect the public by more effeciently using our nation's limited toxicological resources, testing should be restricted to those chemical substances the Administration determines pose an unreasonable risk to health or the environment. The extraordinary cost of testing all chemicals if it could ever be accomplished would be enormously disproportionate to the benefit the public might receive relative to any unexpected toxicity data which might be developed. Such indiscriminate testing would be a serious burden to the viability of the chemical industry and its ability to develop new chemicals. Authority given to the Administrator to not propose regulations for those chemicals which he determines are of no unreasonable environmental or public health threat does not provide a reasonably limitation on the scope of the testing requirements. Inherent bureaucratic reluctance to make such a determination could result in rulings requiring maximum testing of substantially all new chemical substances.

Attached as Exhibit A is a sample of the toxicity testing program Du Pont presently conducts and the type of testing we expect to do under various existing and proposed laws. You will note that we have indicated the money and time required to perform these tests. For example, on page 2 of Exhibit A, it would take about 4 years and cost approximately $440,000 to run the oral, dermal, inhalation, and special tests which could be required for one chemical substance identified as likely to pose a substantial danger to health or the environment. Such testing should be restricted to those chemicals which would require this extensive evaluation.

PRE-MARKET SCREENING OF NEW CHEMICAL SUBSTANCES (SECTION 5)

We believe it may be desirable from a public interest point of view to allow EPA to screen toxicity test data developed for chemicals which EPA has determined are likely to pose a substantial danger. We recognize that companies have a responsibility to the public to give EPA time to evaluate the data and initiate any necessary restrictions. We agree that 90 days, with a 90-day extension for good cause shown, should be sufficient to allow EPA to conduct effective screening.

We suggest that this Committee adopt the pre-market screening approach of H.R. 5356 and only require EPA to screen those chemicals which EPA finds pose, or are likely to pose, a substantial danger to health or the environment. We share EPA's concern, as expressed by Mr. Dominick, in his testimony before this Subcommittee, that pre-market screening should not put an unnecessary burden on the chemical industry by stifling innovation or making the development of new chemicals that much more expensive that it presently is.

We agree completely with Mr. Dominick's statement the EPA ". examine that particular portion of data relating to those particular substances, which may, indeed, turn out to cause a hazard to the environment." We feel this could best be accomplished by focusing the screening mechanism on those chemicals for which there is an indication of a substantial health or environment danger. We feel that such a screening procedure is an acceptable way for EPA to check and evaluate industry's data, which would eliminate the need for any type of pre-market certification directed toward the same end. Any certification procedure would, without commensurate benefit, result in delays because of EPA's inability to focus their efforts primarily on those chemicals they feel are the major problems. In addition, various other sanctions operate in the marketplace such as liability suits, adverse publicity, and cost of recall, or of idle production facilities designed for a product which has been restricted or banned further support the authority in the prescreening mechanism and encourage industry to be responsible and thorough in their testing.

We object to the unlimited authority given the Administrator under section 5(b) to issue restriction regulations for a chemical substance in the absence of data. This would encourage EPA to continually ask for additional data before allowing a chemical to pass through the screening period or to set restrictions based on what EPA alleges is an absence of data, consequently requiring a manufacturer to do further testing to rebut EPA's presumption of harm. The result would be additional and financial and time burdens on the manufacturer and deprivation of the public from the benefits of innovation. The Administrator has authority to require testing under section 4 and he should be required to base any regulations on data developed pursuant to such tests or any other data available to him.

We believe that section 5(a) of S. 426 which exempts a subsequent manufacturer of a chemical substance for which test data has been submitted by the original manufacturer from submitting duplicative data is inequitable and should be amended. Such authority penalizes those companies that develop new products, test them according to a protocol and submit the results to EPA for screening relative to a competitor who could produce the same chemical without having to do the research to develop the chemical or the testing to demonstrate its safety. Considering the time and money expended by a responsible company doing the research and testing, it would receive only a de minimis advantage in the form of a few days' or month's lead time.

We do not advocate that the nation's limited toxicological capabilities be burdoned by unnecessary duplicative testing, but rather that the law require a subsequent producer to pay a reasonable compensation to the original tester for the use of his data. Such an approach was adopted by Congress in passing the Federal Environmental Pesticide Control Act of 1972. We also suggest that any subsequent manufacturer be required to make a showing that his chemical substance is identical or substantially identical to the chemical substance for which the original test data was submitted.

RESTRICTIONS ON USE OR DISTRIBUTION (SECTION 7)

For the reasons stated in our discussion of Section 5, we encourage limitation of the authority in Section 7(a) to issue restrictions .. in the absence of acceptable test data required under sections 5 or 6. .". Such unlimited authority would tend to deter EPA from making a proper substantive evaluation of all test data submitted.

The quality control authority of section 7(c) should be amended to allow the Administrator only to require a manufacturer to periodically verify that the composition of his chemical substance is identical or substantially so to that chemical substance for which a particular restriction or use or distribution is applicable. The Administrator should not have the authority to dictate the type of quality control procedures a manufacturer must use to achieve the desired control.

If the Administrator becomes concerned that a chemical substance is contaminated to the point where it presents an unreasonable health or environmental threat different from the pure chemical substance, he would have the authority to treat the contaminating chemical as a separate chemical substance. The Administrator could then use all the authority given him in the bill to regulate the contaminated substance.

REPORTS (SECTION 10)

The Administrator should not be mandated to require reports from all manufacturers of chemical substances. In order to provide him with the flexibility to use EPA's resources efficiently, the Administrator should be given discretionary authority to require reports of any manufacturer if and when needed.

EXEMPTIONS AND RELATIONSHIPS TO OTHER LAWS (SECTION 11)

In view of the number of environmental laws presently in effect, we recommend that any toxic substances law be designed to provide for regulation of gap areas not covered by other laws. Only if a risk to health or the environment cannot be sufficiently prevented or reduced by other federal laws, should EPA have authority to use this Act. We advocate that the Committee amend this section accordingly.

CONFIDENTIALITY (SECTION 16)

Since the chemical industry is so technologically oriented and lead time in the marketplace is vital, appropriate safeguards of confidential information are essential to protect secrets or other confidential information submitted by a company. We believe that the confidentiality section of S. 888 affords such protection and we advocate that S. 426 be amended accordingly.

STATE REGULATIONS (SECTION 23)

In order to avoid a myriad of state regulations applicable to any given chemical substance, a state or local government should be required to show that a local health or environmental risk exists which cannot be abated by federal regulation. Section 23(b) should be amended accordingly.

AUTHORIZATION FOR APPROPRIATIONS (SECTION 26)

Section 26 (b) should be amended to set an upper limit on any fee set by the Administrator on the manufacturer of each chemical substance for which test data has been submitted. Such an upper limit could be $500. Any fee greater than this would and unduly burden small manufacturers and could serve to encourage some persons not to submit data.

MARKET TESTING

We encourage the Committee to add a provision to S. 426 which would provide for market testing. Test marketing is essential to be able to determine whether a market in fact exists for a product before large capital expenditures are made for production and distribution facilities. In view of the importance of lead time in the market, it would be necessary to be able to test market on a limited and regulated basis early in the developmental stage of a product. S. 426 should be amended to add a provision authorizing EPA to permit a manufacturer to test market a chemical substance upon a showing by the manufacturer that test marketing under whatever restrictions EPA determines are necessary, would not pose an unreasonable health or environmental risk.

HEARING RIGHTS

We believe that the hearing rights afforded interested parties are seriously deficient. In connection with regulatory proposals establishing test protocols designating products requiring pre-market screening, restricting or prohibiting use, hearing rights are limited to oral or written presentation of data, views or arguments. There is no right to cross-examine witnesses.

While one might argue that the need for cross-examination rights may be questionable in determining purely scientific questions, we would point out that none of the various regulatory proposals covered by this legislation involve pure science. Moreover, any regulatory proposal could have serious, adverse effects on an industry or a particular member thereof or some segment of the public.

The opportunity to cross-examine the witnesses of the Administration or others who may wish to comment is essential to the orderly development of scientifically sound and reasonable regulations in the public interest. Cross-examination is also essential to the rights of any adversely affected or interested party so that an appropriate evidentiary record can be established to support judicial review where necessary. While we recognize that the right of cross-ex

amination, in some unique situation, might result in some delay, the exclusion of such rights solely to prevent such possible delay would be most undesirable and not in the public interest.

STATEMENT OF ELMER A. FIKE, PRESIDENT OF FIKE CHEMICALS, INC.

I am Elmer A. Fike, President of Fike Chemicals, Inc., a corporation located at Nitro, West Virginia. Fike Chemicals, Inc. employs fifty-five people, manufactures forty small volume specialty, organic chemicals and does an annual sales volume of business of somewhat over $2,000,000.

In addition, I am chairman of the legislative committee of the Chemical & Specialties Management Council, a group comprised of twenty-five companies in the eastern United States who, altogether, employ about one thousand people and whose total sales are in excess of one hundred million dollars. A list of the membership is included with my written testimony. The C&SMC membership as well as myself are very concerned about this TOXIC SUBSTANCE CONTROL ACT and the effect it will have on our ability to continue in operation. The cost that could be imposed by unrealistic testing requirements could easily force many of us out of business. We are as interested as anyone in protecting Man and the Environment from unnecessary chemical hazards. We do question, however, that this bill, as drafted, will do little more than impose a new set of problems on the small chemical manufacturers.

Fifteen years ago, our company manufactured agricultural chemicals exclusively. However, with the tightening of enforcement of the Federal Insecticide, Fungicide and Rodenticide Act and passage of the Delaney Amendment, the toxicity testing requirements became so severe that we were no longer able to develop new products and continue in this area of business. Other small companies had similar experiences and, as a result, the field was left to the large companies for all practical purposes. We would face similar problems in the area of industrial chemicals if this legislation were passed and enforcement was unrealistic.

Many large companies and associations of large companies have outlined the problems in this Act and we concur with most of their observations. However, the small company faces a special class of problems and my testimony will be presented from the viewpoint of the small company.

PROBLEMS OF INTERMEDIATE SCALE COMMERCIAL CHEMICALS

When a chemical reaches large volume sales, it is practical to undertake extensive toxicity testing. However, there are large numbers of chemicals offered in the intermediate range-less than 500,000 pounds per year-that do not have the volume that would justify extensive testing from an economic standpoint. When the annual sales of a chemical are less than $100,000, it is impractical to spend $100,000 or more to carry out the extensive testing program that might be required under this act. Also, it is important to note that most of these compounds go into industrial products rather than consumer products so that they never come in contact with the consuming public.

Fike Chemicals, Inc., which is typical of many small companies, manufactures forty chemicals for a total annual sales volume of just over $2,000,000. The uses of these chemicals vary widely but they are not offered to the general public nor do they go into consumer products. Examples of uses are boiler cleaning compounds, corrosion inhibitors, polymerization modifiers, plating additives, and chemical intermediates to manufacture other products. These compounds and hundreds of others like them made by many other companies are vital to industry. It would be impractical to spend the amounts of time and money to test each one of them as extensively as this bill might require. No doubt, some degree of testing is required to insure safety of the workers who are exposed to those products but the tests required should not have to be nearly as rigorous as the tests required on chemicals going into consumer products.

It is recommended that the intermediate scale commercial chemicals be recognized as a special class. There should be an adequate definition and appropriate and reasonable test protocol specified which would insure the safety of the worker but recognize economic realities. There should be restrictions to limit their sale to industrial or commercial users and to prohibit their sale to, and use by, the consuming public unless further testing is carried out.

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REPORTING

Organic Chemical manufacturers are required to report their production to the Tariff Commission and, surely, this information is available to the EPA. Not only is the number of pounds produced reported but, in many cases, the end use is given. If there are gaps in this reporting system, then it could be expanded as necessary. It seems highly inefficient for both government and industry to be doing the same job twice.

COST OF TESTING

The sections in S426 which provide that only one company is required to test and other companies get a free ride offers serious practical problems. If the company who pays for the testing incorporates that cost into the selling price of the product, it will not be competitive with the producer who has no such cost. S888 does propose that companies could join together to share the cost and this may be a practical answer. This provision is needed to prevent prosecution for collusion to fix prices or restrain trade.

PENALTIES

The proposed penalties of $25,000 per day are excessive, especially considering the financial penalties for other crimes, even murder.

INCENTIVES

In the past, Congress has set up tax incentive programs to encourage desirable ends. Such programs are DISC Corporations to promote foreign trade, WIN to encourage employment, depletion allowance to encourage exploration for gas and oil, investment credit to promote industrial expansion, and accelerated depreciation schedules to encourage investment in pollution abatement equipment.

Wouldn't it be reasonable to give the chemical industry tax credits for money spent in testing of products, the long range effect of which would be to improve the environment?

PROBLEMS IN TESTING

Many of the test programs suggested in S426 to evaluate the safety of chemicals are not only extremely expensive but the results are not necessarily indicative of the real hazard. A brief discussion of the test for carcinogenesis (just one of the tests suggested in S.426) outlines some of the problems.

At the present time, the simplest test for carcinogenesis costs approximately $50,000 and this may be just a beginning. Furthermore, it is virtually impossibie to prove that any compound will not, under some circumstances or in combination with some other compound, cause cancer. Conversely, it can be said that many chemicals in wide use today could cause cancer if tested long enough, under severe enough conditions and in conjunction with enough other compounds. However, under anything like normal usage, these same compounds would never cause cancer.

The synergistic effects of other compounds are very important in determining carcinogenicity and further complicate the testing. For instance, those men employed in uranium mining who do not smoke have no higher rate of cancer than the normal population but those who do smoke will invariably develop cancer. This is interesting in view of the fact that tobacco products are excluded from coverage in S.426. Does this exclusion mean that tobacco is not to be considered as a synergistic agent in evaluating carcinogenic properties? The current testing program for saccharin is an example of the extreme approach that is sometimes used. Sugar is normally considered to be about 5% of the diet and saccharin is 750 times as sweet as sugar. Therefore, the normal saccharin content in the diet would be about .006% if all the sugar were replaced with saccharin. However, the diet fed animals to determine carcinogenic properties of saccharin contains 7.5% saccharin, over 1000 times the normal dosage. When fed this diet, test animals have developed a bladder condition that could lead to cancer. However, the FDA is suggesting that the condition may be the result of irritation by such massive doses rather than the inherent carcinogenic properties of the compound itself. After all, it is wellknown that repeated irritation, even of a purely mechanical nature, can cause

cancer.