BOARD MEETING DATE: July 9, 2010
AGENDA NO. 40
PROPOSAL:
Amend Rule 1143 – Consumer Paint Thinners and Multi-Purpose Sovents
SYNOPSIS:
The proposed amendments re-adopt the 25 g/L VOC limit for paint thinners and multi-purpose solvents with an effective date of January 1, 2011, previously rescinded pursuant to a court judgment; clarify definitions; and include additional labeling and public education requirements and other measures necessary to address CEQA-related flammability issues with respect to the use of acetone. The proposed amendments will reduce VOC emissions by 3.81 tons per day. (Review Stationary Source Committee, April 16, 2010 and May 21, 2010)
COMMITTEE:
Stationary Source, April 16, 2010, Reviewed; Stationary Source, May 21, 2010, Reviewed
RECOMMENDED ACTIONS:
Adopt the resolution:
- Certifying the Final Supplemental Environmental Assessment (EA) for Proposed Amended Rule 1143 – Consumer Paint Thinners and Multi-Purpose Solvents; and
- Amending Rule 1143 - Consumer Paint Thinners and Multi-Purpose Solvents
Barry R. Wallerstein, D.Env.
Executive Officer
Background
Rule 1143 – Consumer Paint Thinners and Multi-purpose Solvents was adopted on March 6, 2009 to implement Control Measure CTS-04 (CM#2007CTS-04) of the 2007 Air Quality Management Plan (AQMP) which calls for further emission reductions from selected categories not regulated by the California Air Resource Board (CARB) specifically, paint thinners and multi-purpose solvents. The adopted rule had a two-tier volatile organic compound (VOC) concentration limit beginning with a 300 grams per liter (g/L) VOC limit, effective January 1, 2010, and then a final VOC limit 25 g/L, effective January 1, 2011. The expected emission reductions were 5.94 tons per day (tpd) by the year 2011 and an additional 3.81 tpd by January 1, 2012 resulting in a total VOC reduction of 9.75 tpd by January 1, 2012, when the rule would have been fully implemented.
On April 1, 2009, W.M. Barr filed a challenge to the rule alleging numerous violations of the California Environmental Quality Act (CEQA) and the South Coast Air Quality Management District’s (AQMD) certified regulatory program codified in AQMD Rule 110. The Los Angeles Superior Court (court) rejected these claims except that it found that the CEQA document inadequately analyzed the potential substitution of mineral spirits with the more flammable VOC exempt compound acetone. In response, the AQMD filed a motion to limit the court remedy. On April 1, 2010, the AQMD’s motion was granted in part, but a court order required the AQMD to vacate the final VOC limit of 25 g/L and prepare a CEQA document that would better address the fire hazard issue.
On September 24, 2009, CARB’s Board approved the amendments to the Consumer Product Regulation to include similar VOC limits for paint thinners and multi-purpose solvents as Rule 1143, but on a delayed implementation schedule.
Rule 1143 was amended on June 4, 2010 to rescind the final VOC limit of 25 g/L to comply with the judgment and writ of the Los Angeles Superior Court.
Affected Facilities
Paint thinners and multi-purpose solvents are available at a variety of retail outlets, including mass merchants like Home Depot, Lowe’s, ACE Hardware and Orchard Supply Warehouse, as well as the smaller proprietary hardware stores. The facilities subject to the proposed amended rule also include manufacturers, suppliers, distributors and retailers of consumer paint thinners and multi-purpose solvents and anyone who uses or solicits the use of any consumer paint thinner and multi-purpose solvent within the District.
Public Process
During the rulemaking process, staff made multiple visits to retail outlets and met with industry and members of the community. A public workshop was held on April 28, 2010.
Proposal
Proposed Amended Rule (PAR) 1143 re-establishes the 25 g/L VOC limit, and regains the foregone reductions of 3.81 tons per day of VOC emissions. Additionally, the proposal includes consistency with the statewide regulations in terms of definitions and labeling, includes public education and outreach requirements, and other measures to better address CEQA-related flammability issues with respect to the use of acetone.
Key elements of PAR 1143 include the following:
Revise definitions
Re-establish a VOC limit of 25 g/L for consumer paint thinners and multi-purpose solvents, effective January 1, 2011
Add consumer warning requirements for all flammable and extremely flammable products, as well as modify labeling requirements for exempt thinners and solvents
Conduct outreach with local fire departments to consumers regarding the potential increased availability of more flammable paint thinners
Make clarifications to enhance enforceability
Emission Reductions and Cost Effectiveness Determination
The proposed amendment will have a final VOC limit of 25 g/L, effective January 1, 2011. The expected emission reductions for this proposal have been estimated to be 3.81 tons per day (tpd) by the year 2012, when the first VOC limit will be fully implemented with consideration for the 12-month sell through period.
Therefore, the overall cost-effectiveness is estimated to be $9,905/ton of VOC when reducing the current VOC limit of 300 g/L to the proposed VOC limit of 25 g/L. As noted in the final staff report, dated March 2009, the overall cost-effectiveness of the rule, with consideration for the average VOC limit of 736 g/L for conventional products, was $3,384/ton. Staff also noted a significant cost reduction for the products that meet the VOC limit for 300 g/L, when compared to the products in use prior to the adoption of Rule 1143 in March 2009.
AQMP and Legal Mandates
PAR 1143 implements Control Measure CTS-04 – Emission Reductions from the Reductions from Consumer Products not Regulated by CARB (CM#2007CTS-04), of the 2007 AQMP, by limiting VOC emissions at the point of sale and the point of product application.
On April 1, 2009, W.M. Barr filed a petition for writ of mandate and declaratory relief, challenging Rule 1143, primarily based on alleged inadequacies of the Final Environmental Assessment (EA), including the analysis of fire safety issues related to the increased flammability as a result of compliant formulations that use acetone as an exempt solvent. On December 7, 2009, the court upheld the AQMD’s Final EA except for the flammability issue. Subsequently, the AQMD filed a motion to limit the court’s remedy. On April 1, 2010, the AQMD’s motion was granted in part, but the judgment and writ requires the AQMD to vacate the final VOC limits of 25 g/L, and prepare a CEQA document that better addresses the fire hazard issue.
Key Issues
Several key issues have been brought to staff’s attention during the public workshop and the public comment period thereafter. The key issues are summarized below, along with staff’s response:
ISSUE: The district does not have regulatory authority over consumer products.
RESPONSE: The AQMD does have legal authority to re-establish the 25 g/L VOC limit which will be effective January 1, 2011. AQMD has consulted with CARB’s legal staff. CARB has informed the AQMD that for purposes of Section 41712(f), CARB interprets the date of adoption to be the date its Executive Officer has signed off on the regulation, after the 15 day revision. Mr. Robert Jenne, CARB’s Assistant Chief Counsel, has formalized this opinion in a letter to the District. PAR 1143 has shorter implementation dates than CARB’s statewide Consumer Product Regulation due to the significant air pollution problem the South Coast Basin is experiencing.
ISSUE: The rule should be consistent with CARB regulations for definitions, labeling limits and implementation dates.
RESPONSE: PAR 1143 has been revised to include definitions as suggested by the commentators, and other definitions were revised for further consistency with CARB’s Consumer Product Regulation. Staff is also proposing to allow the use of CARB labeling requirements as both are designed to further inform the consumers of reformulation. However, staff is not proposing to delay the implementation of the 25 g/L VOC limit. When fully implemented, this rule will reduce VOC emissions by an additional 3.81 tpd by 2012 in the South Coast Air Basin, which equates to 1,391 tpy and 6,953 tons by the time CARB’s final limit is fully implemented.
ISSUE: Flammability concerns not addressed by labeling and public outreach
RESPONSE: Staff has held numerous meetings with the local fire agencies and CARB and continues to work on any possible fire hazard issues. The primary concern brought up by a lead fire authority was that if a product had been formulated with a lower flashpoint solvent like mineral spirits and then was reformulated with a higher flashpoint solvent like acetone, the user of the product may not realize that they were no longer using a combustible material and that they were now using a product that was extremely flammable. The fire authorities have informed staff that they are satisfied with their primary concerns of fire hazards based on the proposed amendments, specifically stating in a letter authored by the fire authority “My opinion, therefore, is that any increased fire risks that acetone-based paint thinners may present, as compared to mineral-spirit based thinners, will be mitigated to a “less than significant” level by PAR 1143’s consumer warning label requirement and a public education program including point-of-sale safety brochures, public safety announcements, and an informational webpage”.
ISSUE: Labeling pre-empted by National Consumer Products Safety Commission
RESPONSE: The Consumer Product Safety Commission (CPSC) implements the labeling requirements of the Federal Hazardous Substances Act. When developing the labeling requirements in CARB’s proposed consumer product regulation, CARB staff consulted with the staff from the CPSC. The CPSC staff explained to CARB that CARB’s proposed labeling requirements do not present a clear conflict with federal requirements and, therefore, do not raise a concern with CPSC. The proposed 1143 labeling requirements described in section (e)(2) are substantively similar to CARB’s labeling requirements, but provide additional options to manufacturers and, similarly, are not preempted by federal law. In addition, for statewide consistency, the proposed labeling requirements will also allow use of CARB’s labeling language.
ISSUE: Reactivity-Based Ozone Control Strategy should be included.
RESPONSE: SCAQMD supports a reactivity-based approach to control ozone and in fact has committed staff to study the effects of a reactivity based approach by actively participating in the North American Research Strategy for Tropospheric Ozone (NARSTO) work related to reactivity. AQMD staff also continues to participate in the following committees: Applications Benefits, Near Term Science, Toxics, Atmospheric Chemistry and Particulate Matter. One of the continuing main concerns staff has is the potential constituents that may have toxicity associated with some VOC containing compounds that have a low Maximum Incremental Reactivity (MIR) value.
ISSUE: District should exempt Low Vapor Pressure Compounds (LVP)
RESPONSE: Staff does not believe a LVP exemption is necessary for the implementation of the 25 g/L VOC limit, since compliant products that use soy or exempt solvents are already available and in use today. Staff’s assessment indicates that solvents that may be exempt as low vapor pressure, under CARB’s Consumer Product Regulation, may add up to 50% of the VOCs in formulations of certain consumer products including cleaning products. Furthermore, CARB does not list any specific LVP solvents that can be used for reformulation of paint thinners, and the LVP exemption was not specifically added to address the paint thinners or multi-purpose solvents categories. Finally, as a result of AQMD’s evaluation of semi-volatile materials, most notably the recent development of PAR 1144 – Vanishing Oil and Rust Inhibitors, it is clear that these VOC solvents do evaporate and therefore are available to react with oxides of nitrogen to form ozone.
California Environmental Quality Act
As a result of a legal challenge to the adequacy of the Final Environmental Assessment (EA) prepared for the original March 6, 2009 adoption of Rule 1143, the Los Angeles Superior Court issued a writ of mandate requiring the SCAQMD to prepare a CEQA document that further considers the fire hazard issues associated with the 25 grams per liter VOC limit in Rule 1143. Pursuant to CEQA Guidelines § 15163 and SCAQMD Rule 110, the SCAQMD has prepared a Supplemental EA for PAR 1143. A Supplemental EA is the appropriate CEQA document for the proposed project because it contains only the information necessary to respond to the specific issue identified by the court, i.e., fire hazards. The Supplemental EA includes a project description and analysis of potential adverse fire hazard impacts that could be generated from Rule 1143. The Draft Supplemental EA was released for a 30-day public review and comment period from May 6, 2010 to June 4, 2010. By the close of comments deadline, staff received 3 comment letters and one letter after the close of comment period, and has prepared responses. All of the comment letters along with the responses to comments are included in Appendix D of the Supplemental EA, except the responses to the late comment letter.
Socioeconomic Impact Assessment
PAR 1143 will affect approximately 107 manufacturers and 12 distributors of paint thinners and multipurpose solvents. The manufacturers and distributors belong to the industries of chemical manufacturing and wholesale trade. Only 15 manufacturers are located in the South Coast. All the users of thinners and solvents under PAR 1143 are assumed to be the general public.
Considering that CARB’s VOC limit requirement of 3%, roughly equivalent to the 25 g/L limit, is implemented three years after Proposed Amended Rule 1143, the Socioeconomic Impact Assessment Report is analyzing the costs for this three year time period only, since these costs would be incurred under CARB’s requirements. Staff has developed two scenarios to analyze these potential impacts. Scenario A assumes the cost of PAR 1143 would be incurred by consumers as price increases. Scenario B assumes that all costs borne by local manufacturers who would have to reformulate their products to meet the requirement of PAR 1143 will pass their costs to consumers. Compliance costs are the same under both scenarios, but the scenarios differ with respect to the amount of the costs passed on to final consumers of the affected products. The average annual cost from 2011 to 2013 is $13.8 million of which $3.5 million would be borne by local manufacturers. Depending on the formulation selected, consumers may experience an increase in the product price of $3 to $42 per gallon. However, the majority of the price increases are expected to be about $11 per gallon.
The proposed amendments are projected to result in 58 to 118 jobs forgone annually, on average, from 2011 and 2013 in the local economy, which is at most 0.0035 percent of the baseline jobs in the four-county area and within the “noise” of the economic model used. The projected job losses would occur in the absence of PAR1143 upon implementation of the 25 g/L VOC limit by CARB, concurrent with the three year delay in air quality benefit. The results herein are similar to those from the socioeconomic analysis performed for the March 2009 Rule 1143 adoption. However cost differentials per gallon of product, gallons used, and the version of the REMI model have been updated since the last analysis.
Implementation and Resource Impacts
Staff recommends that PAR 1143 be adopted to restore the VOC emission reductions that were foregone due to the June 4, 2010 amendment and implement control measure CM#2007CTS-04 of the 2007 AQMP. Staff believes that the implementation and enforcement of the PAR 1143 at both the manufacturer and retail levels can be conducted with existing resources.
ATTACHMENTS (EXE, 17.0Mb)
A. Summary of Proposed Amended Rule
B. Rule Development Process
C. Key Contacts List
D. Resolution
E. Proposed Amended Rule Language
F. Final Staff Report
G. Final Supplemental Environmental Assessment
H. Socioeconomic Assessment
I. Final Environmental Assessment for Rule 1143 (March 6, 2009)
Errata (PDF, 1.3Mb)