Monday, August 15, 2011

Feeling Relief Yet?

Late last week, the President signed H.R. 2715, a law that is intended to help clarify and enhance the Consumer Product Safety Improvement Act of 2008. I sincerely appreciate the hard work of the House and Senate leadership in prioritizing some necessary reforms, including exemptions from the law’s non-risk-based lead content and/or third-party lead testing requirements for ATVs, bikes, books and most used children’s products. In addition, avoiding the waste of retroactively applying the CPSIA’s .01% lead limit was a priority for all children’s product manufacturers—and I am thankful that HR 2715 strips the CPSIA of this unnecessary requirement.

By exempting children’s ATV’s from all lead limits, allowing bicycles to remain at 300ppm, and exempting from third-party testing the metal components of bicycles and most children’s books, Congress signaled its awareness that these products do not present a health risk to children. I continue to urge my colleagues to regulate based on risk and to exercise flexibility wherever possible and appropriate. As I have argued in my statement on 100ppm the Commission’s approach to lead is clearly one of those cases.

Notwithstanding these improvements, Congress missed a rare opportunity to ensure that all safe, children’s products (not only ATVs, bikes and books) may be legally sold —and that non-risk-based, costly testing and certification requirements be eliminated in favor of more efficient, more meaningful ways to enforce safety measures up the supply chain for domestic and foreign manufacturers.

While some proponents of the law will argue that it reduces the burden of third party testing on small manufacturers, the fact remains that this mechanism applies to only a small niche of the overall regulated business community. By excluding from the third party testing requirement very low production products (7,500 units), provided they are manufactured by a business meeting a very narrow definition of “small” ($1,000,000 annual revenue), the law allows few businesses to obtain relief under this provision, perhaps including only those who fashion by hand unique or very small batches of products.

In addition to the perceived relief, it is important to note that no businesses will be excluded under the provision until the Commission has issued guidelines under which businesses may register their status with the CPSC. I hope that the political leadership of the Commission recognizes the importance of prioritizing the drafting of these guidelines, so that small businesses can register before the crushing costs of third-party testing drive them out of business, when the stays are lifted on January 1, 2011. In this respect, to paraphrase our Chairman, relief delayed is relief denied.

Some continue to suggest that H.R. 2715 will meaningfully improve the public database. Sadly, this is not the case. The law’s grant of up to 5 additional days to investigate material inaccuracy claims before posting reports will do little to reduce the number of inaccurate reports published. Similarly, little is achieved by requiring the Commission to “seek the model, serial number, or a photograph,” when not included within a report. By not requiring the commission to actually obtain the information prior to posting the claim, this provision is little more than a smoke and mirrors technique aimed at silencing criticism of the database. In the end, reports will continue to be posted without this information, manufacturers will still often be left with insufficient information to understand and respond to reports, and consumers will be left guessing about the subject of many of these claims.

While I clearly do not agree with the view that this new law addresses all of the problems in the CPSIA, I do remain hopeful that this will give the agency the opportunity to take a fresh look at the costs and benefits of the rules we issue, especially as they relate to small business. I believe that this new law requires us to re-propose our pending rule addressing periodic third party testing since the underlying rule has changed, as well as provides us with the opportunity to regulate based on fact rather than on opinion.

Finally, it is a mistake to conclude that Congress intended to endorse those provisions of the law that it failed to change. Just as a Congressional majority could not be found for more significant changes to the CPSIA, it is clear from the tenor of debate that there would also not be majority support to pass the original CPSIA today.

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