The Printing Industries of America and I as the industry's representative have extensive experience working with the Environmental Protection Agency and state government on environmental matters. I have served as a member of EPA's Clean Air Act Advisory Committee since it was formed following the passage of the 1990 Amendments to the Act. I subsequently was appointed to the subcommittee charged with advising EPA on the implementation of the new standards. I have also been appointed to the Small Entity Caucus and the Small Entity Review Team at EPA to provide information on the impact of the implementation of the standards on small business. Further, the industry is one of EPA's Common Sense Initiative sectors and a partner in the Design for the Environment project. Finally, we have been involved for nearly four years with the Council of Great Lakes Governors and the Environmental Defense Fund in the Great Printers Project, a major pollution prevention project for our industry. The EPA has been a strong supporter of this project.
In addition to these specific projects, PIA along with the National Federation of Independent Business and the American Furniture Manufacturers' Association lobbied successfully for the passage of the Small Business Technical Assistance Amendment to the 1990 Clean Air Act Amendments. This program known as the "507" program after the section of the Act has been enormously successful despite underfunding and has become a model for small business programs in other environmental legislation.
My purpose in outlining these activities is to establish the fact that we are an industry which is working to support positive environmental actions. We are not alone. Many small business groups are working on similar projects. As you know, small business is uniquely tied to its community A good, sustainable environmental policy is critical to the future of these businesses.
I want to address several issues connected to the NAAQS proposal, but I want to say at the outset that EPA and the Administrator have done a great deal to open communication with small business and to explore opportunities for alternative paths to compliance. While EPA's work with small business continues to have room for improvement, it is our opinion that EPA does more than any federal agency in seeking the cooperation of small business. We meet regularly with senior officials at EPA on a variety of topics including regular meetings with Deputy Administrator Fred Hansen. Further, the EPA Small Business Ombudsman continues to provide a level of service to which all agencies should aspire. Now I wish to highlight our concerns with the proposed standards and their implementation plans:
THE STANDARD IS NOT NECESSARY
We understand the Clean Air Act's requirements for a review of the scientific and health data and the need to make changes in the NAAQS when the data suggests a need to do so. What we do not understand is how a change can be suggested when the air is steadily improving and when the 1990 amendments to the Clean Air Act have not yet been fully implemented. In fact, significant portions of the Act have not been implemented. It would have been a genuine surprise if the health and science advisors to EPA had come back with a conclusion that there is no relationship between air pollutants and health. It is also an obvious conclusion to suggest that the cleaner the air the less adverse affect on health. It is quite a leap in logic to say that because of these conclusions, the entire nation has to undergo an extremely expensive regulatory adventure which may or may not achieve the desired results.
There is an assumption that the federal government must set a standard for the nation-including its states and localities and its businesses or progress will stop. In fact, state, localities, small printing company owners and other small businesses believe we have as much as, if not a greater, stake in a clean environment than the Administrator. Printers work with state officials on a regular basis to develop programs to improve compliance where it is required or voluntary reductions of emissions where compliance is not required. The printing industry has cooperative projects in Illinois, Michigan, Minnesota, Wisconsin, Massachusetts, Florida, Ohio and Texas. Other states are examining similar opportunities. In virtually all of these instances, the vast majority of the companies participating in the programs are too small to be considered major sources under the current Clean Air Act or under state programs. Instead, these companies are seeking ways to reduce emissions of all types as good management practice. These are all actions which have been generated at the state level in full cooperation with the businesses in the states. In fact, with the exception of very large companies in our industry, regulation of printing companies is done at the state level. Our members would argue that the states are doing their job aggressively.
EPA'S DATA BASE IS FLAWED
EPA has based much of its activities to date and predicates future activities on an assessment of the emissions from various industries. For example, EPA estimates the volatile organic compounds released by the printing industry is approximately 101,000 tons, making printing the fifth largest source of VOC's among stationery sources. This data may be correct but neither we nor they could verify it. Their information is taken from models based on permits supplemented with other types of industry information; however, permits are not accurate. It is instructive to understand the real world of permits to understand this point.
Permits are not issued based on what a company does but on what a company is capable of doing or what it might do under certain circumstances. Further, if the company hopes to get more business, it has to buy a bigger permit than it may currently need to accommodate the growth.
One of the most contentious issues emerging from the Clean Air Act Amendments of 1990 was that emissions are based not on actual emissions but the potential to emit. To date, PTE as it is known has been calculated in most parts of the country as operating 24 hours per day throughout the year at full capacity. Clearly no one does this. Printing company owners probably dream of being able to use their equipment to full capacity. PTE can be modified if a company can prove through emission monitoring that their actual emissions are lower. Unfortunately, small business has difficulty coming up with such proof since monitoring emissions is very costly.
The EPA is currently in the process of revising its rules on PTE and we believe the revisions will be satisfactory. However, the current figures issued by EPA are based on existing calculations. It is entirely possible that if EPA had the resources to study the emissions from the printing industry, they would find that we do not have the amount of emissions they project. In addition, in the printing industry, three types of sources are subject to federal controls-gravure, flexographic and large heatset web printing companies. The rest of the industry has an altogether different emission profile from these companies; therefore, conclusions drawn from one of the three printing processes with federal standards do not apply to the rest of the industry. It is our understanding that other small business industries have similar problems.
EPA DOES NOT HAVE ADEQUATE GUIDANCE FOR THE STATES
One of the long-standing issues between the printing industry and EPA has been the development and publication of control techniques guidelines (CTG). Twice in the past seventeen years, EPA has begun a CTG project for the industry and twice has abandoned the project. In the first case, EPA completed a significant portion of the CTG, but stopped the project when industry objections to their conclusions reached a critical stage. Nevertheless, the draft-with its flaws-was released to the states.
That draft CTG in the early 1980's created significant problems for us since state were regulating based on faulty conclusions. In the 1990 Amendments, EPA was required to complete work on 12 CTG's. We were to have been one of these CTGs. However, despite completing most of the work, the document was never completed. EPA made available an Alternative Control Techniques document. Unfortunately, failure to complete the CTG left the industry without the kind of uniform guidance which would have resolved many difficulties at the state and local level. Issuance of a CTG by EPA means that the guidance described is used by the states whereas an ATC merely provides examples of processes.
We are attempting to get this project back on track at EPA since consistent guidance would reduce regulatory costs for us and enforcement costs for the states and EPA. We have had recent meetings with EPA officials and we believe this matter may be finally be resolved.
One of the major problems faced by EPA is having to make technical decision regarding U. S. industry. These industries are complex and must be thoroughly understood in order to issue good regulations. This is a time consuming and costly process but absent the process, industries such as printing are faced with regulations that do not make sense and do not improve air quality. EPA's problems are magnified when the industry is predominantly small businesses such as printing. It is clear that the agency should devote more of its resources to this level of activity well in advance of enforcement activities.
SMALL BUSINESS WILL BE HARDEST HIT BY THE NEW STANDARDS
We have heard that EPA plans to target certain industrial segments under the new NAAQS. Further, we have been lead to believe that if the emissions can be achieved from these sources, it will not be necessary to go after small sources. Unfortunately, life in the environmental regulation community does not work that way.
EPA rarely regulates small business directly. Small business is subject to regulations by states and regions under state implementation plans or SIPS. These SIPS lay out the plan for reducing emissions through an area. Establishment of a SIP is often a political fight. Small business falls into the category known as area sources. Typically, a state must reduce a target amount from such area sources. This is often done by a percentage basis-telling all companies of a certain size to reduce by a specific percentages on an industry basis-lowering the level at which companies in an industry must be permitted. At that point, the agency often issues control requirements known as Reasonably Available Control Technology. If the technology requirement is inappropriate, the industry in faced with a fight to change the proposal. This is done on an area by area basis. Emission reductions on area sources is a regulatory version of carpet bombing.
While the problems on large businesses are no less onerous, they are generally armed with specialists to meet with the agency. Large sources may even have an opportunity to negotiate timetables or control strategies. Small business rarely has such help.
It is also rare that small companies have the resources to implement the kind of controls required by the agency. Sometimes the control are add-on devices which in our industry can cost millions of dollars. Other times the requirements are "process controls" where the printer has to change the chemistry of the printing process. Some of these changes are practical; some are not. Government officials have proposed total enclosure of printing presses as a control option leaving the obvious difficulty of getting the press operator safely to the press. We have had process controls recommended which compromise the printing process itself. Often these controls are suggested in advance of thorough review. Often industry protests are ignored until substantial resources have been invested to produce counter arguments.
From a purely political standpoint, it is often easier for a state agency to apply a general 10 percent emission reduction requirements on a large group of area sources than to apply a costly engineering control on one or a relative handful of very large sources. Often the small sources do not know what has hit them until the process is over.
The development of the NAAQS standards is typical of what happens to small business. Many in the small business segment were caught by surprise at EPA's plans. While the printing industry has been represented at many of the meetings, there was very little small business representation until recently. It was only after the proposals had been issued and a good portion of the work of the implementation subcommittee had been finished that small business was invited to begin meeting with EPA. Fortunately, it may not be too late for small business to influence the process and EPA officials seem to be genuinely interested in our views.
EPA SHOULD PROVIDE A REGULATORY IMPACT ANALYSIS
We have been in an ongoing discussion with EPA about whether or not various laws apply to this proposed new standard and its implementation. Candidly, for most of us in small business, we cannot understand why an agency would not want to thoroughly gauge the impact of a regulation on small business. We have never understood why any arm of government would have to be forced by law to assess the harm that may result from an agency action. In the case of the current proposal, any delay or cost impact of the analysis would be more than offset by the positive results of such analysis.
We recommend that EPA take this concept one step further by aggressively seeking ways to limit the adverse affect of the proposals on small business. Since the Act does not require EPA to include small sources in the federal program, it could use the implementation strategy to develop clear alternative programs for small business.
THE IMPLEMENTATION PROPOSAL MAY BE TOO CONFUSING
EPA is reviewing various recommendations from the implementation subcommittee of the Clean Air Act Advisory Committee which would change areas to which the new standards would be applied. These new areas known as areas of influence and areas of violation would replace the current designations for non-attainment. We would urge careful consideration of the impact of these new areas on small business. While the current regime may not provide the ideal framework for dealing with every air emission problem, the business community-including the small business community-understands attainment and non-attainment. Whenever possible, we should avoid the implementation of new terms of bureaucratic management such as AOV's, AOI's, RAMP'S and RIP'S. These new terms would be in addition to SIPS.
WE THOUGHT THE AGE OF COMMAND AND CONTROL REGULATION WAS OVER
We keep hearing that the age of command and control regulation is over and yet we keep getting new commands. As I outlined above, the printing industry has involved itself in as many projects as EPA has offered. We want to participate, learn and improve; however, if this new standard goes into effect, I could not encourage our industry to engage in similar projects in the future. What is the point of working toward consensus on environmental issues when the final step in the process is to raise the bar? An argument could be made that an industry which waits for regulations rather than seek change may spend fewer resources in the long run. It would be ironic if the proposal by Administrator Browner had the effect of killing the projects which have marked her service at EPA.
WHAT DO WE RECOMMEND
1. We know that EPA must review the NAAQS periodically. If the Administrator is convinced that this standard is necessary, it should only be implemented when it is clear that the current standard is no longer achieving the desired results. One way of approaching the new proposal is to make it conditional subject to review after the full implementation of the current Act.
2. At a minimum, a final decision on the proposed standard should be delayed until a full inventory of current emissions from industry has been developed and subjected to thorough review. Further, the standard seems to need additional scientific and medical review. Additional time would assure that such review can occur.
3. EPA should be specifically required to conduct a thorough regulatory impact analysis. This standard has the potential to permanently drive manufacturing away from significant portions of the U. S. and make it virtually impossible for any inner city to attract manufacturing jobs. We do not believe this should be a burden to the agency but an opportunity.
4. EPA should be required to fully implement the 1990 Clean Air Act amendments before embarking on a new regulatory plan. An example of this includes the 507 programs referenced above. While the full implementation of these programs is required under the Act as a condition of SIP approval, most states do not have adequate programs. Many states are cutting back on such programs due to the pressure from EPA for enforcement. Despite what we hear about the end of command and control, it is command and control that gets the funds while help and information get short-changed.
5. Finally, EPA has an unprecedented opportunity to practice what it preaches. As we have said, there is nothing in the Act that requires EPA to regulate small business. In fact, as we have stated, most of the regulations on small business come at the state level under pressure from EPA. EPA has the power to provide incentives to the states to deal with small sources through technical and educational assistance. Under such a plan, states could be given credits toward their SIPS equal to the emissions contribution from area sources for properly implemented technical assistance programs. The reality is that neither EPA nor the states have the resources to follow through on command and control activities. The agency may be amazed to find that if you provide guidance and help, small companies may just do the right thing.