Advancing Change

As many of you are aware, the House of Representatives Subcommittee on Commerce, Manufacturing, and Trade recently reported favorably the Enhancing CPSC Authority and Discretion Act of 2011 (ECADA) to the full House Energy and Commerce Committee. The ECADA would correct many of the unintended consequences of the Consumer Product Safety Improvement Act of 2008 (CPSIA) and help to refocus the Consumer Product Safety Commission (CPSC) on its core mission of identifying and eliminating hazardous children’s products.

To help illustrate my position on this legislation, I recently sent a letter to each Member of the Committee identifying not only the strengths of this legislation, but also some suggestions as to ways in which we can make a good bill even better.

On balance, I strongly appreciate the Subcommittee’s efforts to resolve the unforeseen problems caused by the CPSIA, and I look forward to continued progress before the Full Committee. The bill makes great strides toward addressing many of the problems with the CPSIA, including its overregulation of lead, imposition of huge third-party testing costs, and a mandate to create a public database using language this Commission subsequently construed to allow the placement of inaccurate and unverifiable information in a government sanctioned database. I therefore support passage of the ECADA and look forward to the day when all of the CPSC’s resources can once again be directed to protecting the public from unsafe consumer products.

Hearing Recap

Earlier this week, I mentioned that the House of Representatives Subcommittee on Commerce, Manufacturing, and Trade would be holding a hearing on a draft version of fixes to the current CPSIA. I appreciated listening to the testimony of all the witnesses and feel confident that the Committee can work in a bipartisan manner to continue this discussion moving forward.

To illustrate some of the important changes this bill would make, I want to draw your attention to a recent article from Bloomberg news entitled “Toymakers Would Get Regulatory Relief Under Republican Plan.” This article helps outline many of the current problems with CPSIA as well as the important fixes that this legislation will address.

Drafting A Change

As some of you may know, the House of Representatives Energy and Commerce Committee recently released a draft version of a bill designed to fix many of the unintended consequences of the CPSIA. This important piece of legislation will be the focal point of tomorrow’s Subcommittee on Commerce, Manufacturing, and Trade hearing.

From my perspective, this legislation will go a long way to reduce some of the unnecessary and over burdensome mandates of the CPSIA. For instance, the bill establishes limits for children’s products that are too large to be swallowed, alternative lead limits for metals and a de minimis exception for other materials. It also limits third party testing to specific categories of products with known risks. These changes would free the Commission to focus its efforts on hazardous products, rather than on the enforcement of non-risk based standards and procedural compliance.

Further, I want to note a key provision regarding the Public Database. The bill narrows the definitions of “consumer” and “public safety entity” to persons who either used a product or are closely associated with someone who did. In addition, the bill requires that the name and contact information of the affected individual be included in the report. I believe these simple changes would address many of my concerns regarding the veracity and verifiability of information submitted to the public database.

Finally, I want to commend Chairwoman Mary Bono Mack and members of her staff for their hard work on drafting this piece of legislation. While I know bills can change significantly during the legislative process, this draft reflects the Committee’s commitment to correct the problems with the CPSIA about which there is strong bipartisan agreement. I look forward to sharing my impressions of tomorrow’s hearing and welcome your comments about this legislation.

Funding Debate

Last week, I had the honor of representing the CPSC as a witness before the House Appropriations Subcommittee on Financial Services and General Government. The hearing, which focused on the CPSC'S 2012 Performance Budget Request, afforded me the opportunity to testify about ways in which I believe we can reduce our budget while actually improving our ability to fulfill our core safety mission.

In my prepared testimony, I illustrated several points where I believe the CPSC is inefficiently using its resources, focusing on the requirements of the CPSIA. For example, I discussed the Commission Majority’s decision to broaden the scope of what falls under the definition of “children’s product.” That decision unnecessarily increased the number of products that must undergo third-party lab testing for compliance with the statutory lead content limits applicable to children’s products. Moreover, the majority failed to meaningfully define “absorption” for purposes of excepting from the third-party testing requirements products that contain no risk. As a result, the rule makes no distinction between products containing lead that is likely to be consumed and products where the lead content cannot cause harm. These regulatory decisions by the Majority have actually increased the economic damage caused by the CPSIA, in areas where the Commission had the discretion to limit that damage.

In addition to my prepared testimony I was able to highlight two points that I believe would be instrumental in reducing both the size of the Commission’s budget and its regulatory burden, especially on small businesses:

First, I urged the Committee to prohibit funding for the new public database until the Commission’s regulations ensure that the information contained in a report of harm is verifiable, and the Commission has established an effective procedure for resolving a claim of material inaccuracy before a report of harm is put on the Database.

Second, I urged the Committee to prohibit funding for the Commission to implement any new third-party testing and certification requirements of the CPSIA. Of course, the Commission would still have its authority to impose such requirements where necessary to address a risk. This will ensure that our focus is on ensuring safety rather than on enforcing standards and paperwork requirements entirely unrelated to risk.

Finally, I was pleased with the discussion by Chairwoman Jo Ann Emerson of the need for a cost-benefit analysis of regulations promulgated under the CPSIA. I believe such an analysis would reveal that much of our CPSIA mandated regulation cannot be justified. This will not only help to save businesses throughout the county that are struggling, but it will also ensure that we are using the resources provided to us by the taxpayer in a logical and substantive manner.

Click here to view last week's broadcast.

Laying the groundwork for reform...

Yesterday, I had the honor of representing the CPSC as a witness before the House of Representatives Subcommittee on Commerce, Manufacturing and Trade. The hearing, entitled “Review of CPSIA and CPSC Resources,” afforded me the opportunity to testify about the unintended consequences of the CPSIA. We can all agree that the original intent of the CPSIA was an admirable one, however, given the massive impact of the law’s testing and certification requirements and the overreach of the Commission’s database regulation, it is now in the hands of Congress to prevent further disastrous, economic consequences. This hearing provided Congress with the opportunity to discuss these key issues.

In my prepared testimony, I argued for two actions that Congress could take immediately to ameliorate the consequences of the CPSIA and two long-term reforms to ensure that harmless products are not caught up in the law’s purview. Immediate recommendations include:

- Prohibiting the launch of the new database until the Commission’s regulations ensure that the information contained in a report of harm is verifiable, and the Commission has established an effective procedure for resolving a claim of material inaccuracy before a report of harm is put on the Database.

- Prohibiting the Commission from undertaking any further regulatory action without first performing a full cost-benefit analysis and making a finding that the cost of the action is justified by its expected benefits. (This would impact accrediting labs to test to the phthalate or toy standards, the 15-month rule, etc.)


Two long-term proposals for reform include

- Amending the law’s absorbability exclusion § 101(b)(1) so that it has meaning. Such a change would result in excluding products or materials with a level of absorbable lead that the Commission determines not to be harmful to a child’s health.

- Eliminating third-party testing, certification and tracking labels of all children’s products, allowing the Commission to retain its authority to impose such requirements only where necessary to address a risk.

These changes will provide much needed relief to small businesses throughout our country. Further, I believe that by doing this, we can ensure that the CPSC will continue to use the tax dollars afforded to us by hard working Americans in a meaningful way, rather than on enforcing standards and paperwork requirements entirely unrelated to risk.

In the hearing's second panel, Members of Congress were able to receive testimony from several of the small businesses that I hear from on a regular basis. These individuals provided firsthand accounts about the effects that our rulemaking is having on their futures.

I am hopeful that moving forward, Congress will take my testimony and the testimony of the witnesses into account in crafting a reform bill.

Click here to view yesterday’s webcast: http://energycommerce.edgeboss.net/wmedia/energycommerce/SCCMT021711.wvx

Staying Power

Last night, the Commission voted 4-1 to extend the stay of enforcement on testing and certification to the lead content standard until December 31, 2011. I am pleased that the Commissioners were willing to compromise on this extension.

While I welcome this decision, I continue to believe that the stay of enforcement should remain in place until one year after the finalization of the Commission’s rulemaking on both Testing and Labeling Pertaining to Product Certification and Conditions and Requirements for Testing Component Parts of Consumer Products. After all, the Commission has broadcast to the regulated community since 2009 its commitment to allow component parts testing and certification to become a viable compliance alternative for manufacturers before third party testing and certification for lead content in most children’s products becomes mandatory.

Over the past several weeks, large and small businesses throughout the country who would have been affected by this decision, have been in contact with my office urging a stay of this testing requirement, particularly since the Commission’s testing regulations have not been finalized. In the absence of those final rules, component suppliers are refusing to test altogether or are refusing to supply certifications. In addition, certifications are unavailable from the retail outlets where many small manufacturers obtain component parts.

I believe that third party testing imposes a financial burden that many manufacturers, and particularly small ones, may never be able to bear. But if there is any hope for their survival, it is essential that the stay not be lifted before there is at least an opportunity for certified component parts to form the basis for the final product certifications of small manufacturers.

If you are interested in learning more about the effects of this decision, please read my official statement for more information.

Please know how much I appreciate all the feedback and information that has been provided to my office over the past few weeks on this topic. This decision was an important victory for businesses both large and small throughout the country. I recognize that this could not have been achieved without your input. As always, if you have any questions or comments, please do not hesitate to contact me at commissioner_northup@cpsc.gov.

Shredding the excess

On January 18, 2011 President Obama issued an Executive Order that expressed his desire to eliminate rules that “stifle job creation and make our economy less competitive.” It should come as no surprise that companies and businesses are continuing to face the burden of government regulation and the challenge of providing opportunities and work for individuals throughout the country. In his recent op-ed, President Obama notes that government agencies need to “make sure we avoid excessive, inconsistent, and redundant regulation.”

As a Commissioner of an independent regulatory agency, I want to know how the CPSC can make this initiative a reality. I invite you to tell me which regulations have been costly to your organization or caused greater inefficiency, where there is very little safety enhancement to be derived. I want to know which rules or regulations your company is worried about, so that together we can move forward in creating jobs while also ensuring safety.

Over the next few weeks, and in the spirit of President Obama’s recent Order, I look forward to sharing with you some of the simple changes that I believe would go a long way in making a significant impact in achieving this goal. In addition, I look forward to receiving your examples and input about ways in which we can move the CPSC in the right direction.