                             
Economic Analysis for the Confidential Business Information Claims under the Toxic Substances Control Act (TSCA) Final Rule
(RIN 2070-AK68)







May 2023


-- Does not contain TSCA CBI --






Prepared for:
				Economic and Policy Analysis Branch
      	Existing Chemicals Risk Management Division
Office of Pollution, Prevention, and Toxics
U.S. Environmental Protection Agency
1200 Pennsylvania Avenue
Washington, DC 20460


The analyst responsible for this report is Alex Smith of EPA's Economics and Policy Analysis Branch. EPA also acknowledges the analytical and draft preparation support of Abt Associates Inc. of Rockville, Maryland, provided under Contract No. EP-W-16-009.

Contents
Abbreviations	5
Executive Summary	6
1.	Introduction	8
1.1	Statutory Authority	8
1.2	Background	8
1.2	Statement of Need	8
1.3	 Purpose of this document	9
2.	Rule Requirements	9
3.	Affected Universe	10
4.	Social Burden and Cost	12
4.1	 Industry Wage Rates	12
4.2 	Respondent Activities and Associated Burden and Cost	13
4.2.1	Rule Familiarization	13
4.2.2	Compliance Determination	14
4.2.3	Electronic Reporting: CDX Registration and Electronic Signature	14
4.2.4	Maintaining Company Contact Information	15
4.2.5	Generic Name	16
4.2.6	Withdrawing Confidentiality Claims and Amending Public Copy	16
4.2.7	Reporting Health and Safety Data using Templates	17
4.3	Total Burden and Cost to Industry	18
4.4	Agency Burden and Cost	18
4.4.1	Agency Wage Rate	19
4.4.2	Agency Cost Savings	19
4.5	Total Annualized Costs	21
5.	Benefits	21
6.	Small Entity Impact Analysis	22
7.	Sensitivity Analysis	26
8.	Additional Analyses	27
8.1	Paperwork Reduction Act	27
8.1.1 Industry Burden	28
8.1.2. Government Burden	28
8.2	Unfunded Mandates Reform Act	28
8.3	Executive Order 13132: Federalism	28
8.4	Executive Order 13175: Consultation and Coordination with Indian Tribal Governments	28
8.5	Executive Order 13045: Protection of Children from Environmental Health Risks and Safety Risks	29
8.6	Executive Order 13211: Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use	29
8.7	National Technology Transfer and Advancement Act	29
8.8	Executive Order 12898: Federal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations	29
9.	References	30


Abbreviations

BLS		Bureau of Labor Statistics

CBI		Confidential Business Information

CBP		County Business Patterns

CFR		Code of Federal Regulations

CDR		Chemical Data Reporting 

CDX                 Central Data Exchange

EO		Executive Order

EPA		Environmental Protection Agency

GPEA		Government Paperwork Elimination Act

NAICS		North American Industry Classification System

OECD		Organization for Economic Co-operation and Development

OMB		Office of Management and Budget

PMN                  Premanufacture Notice
 
RFA                   Regulatory Flexibility Act
 
SBA                   Small Business Administration

SUSB		Statistics of United States Businesses 

TSCA		 Toxic Substances Control Act

UID		 Unique Identifier









                               Executive Summary
This economic analysis estimates the burden and cost associated with the final rule to establish new and amended requirements concerning the assertion and treatment of confidential business information (CBI) claims to the Environmental Protection Agency (EPA) under the Toxic Substances Control Act (TSCA).

The final rule addresses procedural and substantive deficiencies relating to confidential business information (CBI) claims by formalizing approaches that EPA has found to be effective, as well as communicating a general position with respect to the enforcement of procedural requirements. These changes include elaboration on substantiation requirements applicable at the time of submission, electronic reporting requirements, requirements to provide certification statements and generic names when making confidentiality claims, treatment of information used for TSCA purposes that EPA could obtain under TSCA but was originally submitted via other means, and maintenance or withdrawal of confidentiality claims. Additionally, the final rule elaborates on Agency procedures for reviewing and communicating with submitters in regard to confidentiality claims. 

Firms subject to the final rule are those that assert claims for confidentiality in submissions to EPA under TSCA. Firms subject to the rule will incur a burden of two hours with an associated cost of approximately $186 to review the rule. It is expected that 1,100 firms will undertake rule familiarization in the first year after the rule is finalized and that 55 new firms will undertake rule familiarization in each following year. 

The final rule aims to close remaining gaps in electronic reporting by generally requiring that any submission that includes a claim for confidentially be submitted via CDX using the appropriate reporting tool. As a result of this requirement, firms that are new to electronic reporting will incur a burden of approximately 2.670 hours with an associated cost of approximately $236 to complete CDX registration and electronic signature agreements. It is expected that 165 firms will incur this one-time burden and cost in the first year after the rule is finalized and that 55 new firms will incur this one-time burden and cost in each following year. 

The final rule requires maintenance of company contact information, consistent with existing CDX terms and conditions requiring maintenance of CDX accounts. In the first year after the rule is finalized, it is expected that 1,100 firms will incur a burden of 0.030 hours with an associated cost of approximately three dollars to maintain company contact information for five employees. In each following year, it is expected that 1,100 firms will incur a burden of 0.006 hours with an associated cost of less than a dollar to maintain company contact information for one employee. Additionally, in each following year, it is expected that 55 new firms will incur the burden and cost associated with maintaining company contact information for five employees.

The final rule specifies procedures for activities undertaken in cases of deficient claims. In the case that a firm submits a generic name that does not meet EPA's requirements, the final rule specifies procedures for submitting a revised generic name. EPA expects that the changes under the final rule will have no impact on the current burden estimate associated with submitting or negotiating a generic name. This economic analysis also accounts for the burden incurred in the case that a firm withdraws a claim for confidentiality and, as a result, must amend the public copy. EPA estimates that firms withdrawing a claim for confidentiality and amending a public copy will incur a burden of approximately 0.129 hours with an associated cost of approximately $11. In the first year after the rule is finalized, EPA expects that 208 claims will be withdrawn or denied, and therefore, require an amended public copy. Due to the increased clarity in reporting requirements resulting from the final rule, EPA expects that the annual number of claim denials will decrease to 104 in each following year.

The final rule requires firms who submit health and safety studies or information from such studies must provide such data in templated form, using an appropriate OECD harmonized template, if such template is available for the data type (https://www.oecd.org/ehs/templates/). EPA estimates that firms reporting health and safety studies or information using templates will incur a burden of approximately 0.700 hours per submission with an associated cost of approximately $57. EPA expects to receive 350 submissions of templated data annually. 

The total burden and cost to industry resulting from the changes under the final rule is comprised of a one-time burden of approximately 2,945 hours with an associated cost of approximately $272,804 in the first year after the rule is finalized and an annual, ongoing burden of approximately 523 hours with an associated cost of approximately $45,592 in each following year. Overall annualized costs over a ten-year period at three and seven percent are estimated for industry at $71,452 and $75,825 per year, respectively.

The Agency is expected to experience a reduction in burden and cost resulting from improved communication and eliminating claim review for information that is not required to be reported. Additionally, as a result of the electronic reporting requirement, the Agency is expected to experience a reduction in burden and cost associated with scanning, filing, data entry burden and mailing/packaging receipt costs.  Agency cost savings resulting from the changes under the final rule are estimated at $75,710 annually. Annualized costs savings over a ten-year period at three and seven percent are also estimated for the Agency at $75,710 per year.

Benefits of the final rule include improvements to EPA's management of CBI, specifically in cases of deficient claims. The final rule is also expected to reduce the frequency of submitter error and increase efficiency in the processes for asserting and maintaining CBI claims. Additionally, the final rule will generate improved communication and increase public transparency by facilitating public access to information not claimed as CBI. 

As the final rule may affect small businesses that assert claims for confidentiality in submissions to EPA under TSCA, Chapter 6 presents the small entity impact analysis. EPA considers the estimated cost that an individual firm may incur to undertake all of the listed activities covered in this economic analysis and the level of revenue at which that cost would exceed one percent of revenue. When considering an estimated cost of approximately $488, the final rule is not anticipated to have cost impacts greater than one percent on any small entities.

As the number of firms and submissions affected by the changes under the final rule is unknown, Chapter 7 presents a sensitivity analysis that considers the case in which this economic analysis underestimates the number of firms and submissions affected by the final rule.  

 Introduction
This document presents the Environmental Protection Agency's (EPA) analysis of the burden and cost associated with the final rule to establish new and amended requirements concerning the assertion and treatment of CBI claims under the Toxic Substances Control Act (TSCA).

 Statutory Authority 
TSCA section 14(c)(3), 15 U.S.C. 2613(c)(3), requires an affected business to substantiate all TSCA CBI claims, except for information subject to TSCA section 14(c)(2), at the time the affected business submits the claimed information to EPA. TSCA section 14(c)(1)(a) requires an affected business to assert a claim for protection from disclosure concurrent with submission of the information in accordance with existing or future rules. 

TSCA section 14(c)(3) in turn requires an affected business submitting a claim to protect information from disclosure to substantiate the claim, also in accordance with existing or future rules. The language of TSCA section 14(c)(3) is as follows: "(3) Substantiation requirements. Except as provided in paragraph (2), a person asserting a claim to protect information from disclosure under this section shall substantiate the claim, in accordance with such rules as the Administrator has promulgated or may promulgate pursuant to this section.'' 

The Government Paperwork Elimination Act (GPEA), 44 U.S.C. 3504, provides that, when practicable, Federal organizations use electronic forms, electronic filings, and electronic signatures to conduct official business with the public.

 Background
The Lautenberg amendments included several significant changes to TSCA section 14. These include requirements that persons submitting information under TSCA substantiate most confidentiality claims at the time of submission, as well as additional statement, certification, and generic name requirements.  Under TSCA section 14(e), in order to maintain most claims beyond a 10-year period, submitters are required to re-assert and re-substantiate those claims. Several new requirements also apply to EPA, including requirements at section 14(g) of TSCA to review and approve or deny all chemical identity claims asserted since the Lautenberg amendments were enacted concerning substances that are offered for commercial distribution, as well as a subset of all other confidentiality claims, within 90 days of assertion of the claim. Further requirements that EPA review all confidentiality claims for the chemical identity of substances listed as active on the TSCA Inventory, a requirement to assign and apply unique identifiers (UIDs) to substances with approved confidentiality claims for chemical identity, as well as new provisions providing expanded access to TSCA CBI, have been discussed in previous Federal Register Documents. Additionally, some TSCA rules promulgated or amended since the Lautenberg amendments have included confidentiality provisions conforming to the amendments (e.g., Chemical Data Reporting at 40 CFR 711.30 and Active/Inactive Inventory reporting at 40 CFR 710.37).  

The changes under the final rule are intended to clarify the TSCA section 14 requirements for submitters of confidentiality claims. In this final rule, most procedural requirements for asserting and maintaining confidentiality claims would be organized into a final new part of the CFR, part 703. These would apply to any TSCA submission, except as modified elsewhere in part 2 or other TSCA-specific regulations, as spelled out in this final rule. 

      1.2	Statement of Need
Executive Order (EO) 12866 requires regulatory Agencies to identify the specific market failure addressed by a rule. The major causes of market failure identified in the Office of Management and Budget (OMB) guidance (OMB 2003) on EO 12866 are externality, natural monopoly, market power, and inadequate or asymmetric information. The occurrence of any of these conditions justifies further inquiry into the need for government regulation to reduce inefficiencies in the allocation of society's resources (Weimer and Vining 2010). The final rule addresses market failure associated with inadequate information by formalizing and communicating procedures for previously ad hoc activities. 

The final rule is expected to result in a more efficient use of societal resources. By formalizing procedures for previously ad hoc activities, the changes under the final rule are expected to increase efficiency for both industry and the Agency in regard to the submission, maintenance, and review of confidentiality claims. The changes under the final rule will also reduce the likelihood of inadvertent disclosure of confidential information and promote more efficient and timely EPA review of confidentiality claims. The changes under the final rule will also help to ensure that private companies are able to maintain CBI claims for specific chemical identities, while still providing EPA with valuable insight into the universe of chemicals manufactured, imported, and processed in the United States.

      1.3	 Purpose of this document
In support of the rulemaking, EPA characterizes and estimates the potentially affected universe
and total burden and cost to industry. The purpose of this document is to provide economic analysis and produce burden and cost estimates as required by EO 12866. Additionally, certain burdens and cost estimates presented in Chapter 4 of this document are used as input for the small entity impact analysis presented in Chapter 6.
 Rule Requirements
The final rule establishes new and amended requirements concerning the assertion and treatment of CBI claims in submissions to EPA under TSCA. The following discussion details the changes under the final rule.

Electronic Reporting. The final rule requires that nearly all TSCA confidentiality claims asserted in submissions under TSCA must be submitted electronically. Some exceptions to the general requirement to report CBI-containing materials electronically will remain, such as materials that EPA has subpoenaed or requested or collected in the course of TSCA inspection or other enforcement-related activity, which may be in a format or volume that makes electronic submission impractical. It is anticipated that electronic reporting requirements, including modifications to new and existing reporting forms to prompt for substantiation and generic names, and that automatically incorporate the certification statements, will largely eliminate many deficiencies from most TSCA submissions.  

Maintaining Company Contact Information. The final rule requires maintenance of company contact information, consistent with existing CDX terms and conditions. Additionally, the final rule enhances the means by which a submitter may update contact information electronically. Currently, an inordinate amount of Agency time and effort is dedicated to searching for contacts in circumstances where a notice is returned as undeliverable. In light of the significant resources and document tracking concerns resulting from relying on paper correspondence for communication and notifications, correspondence will instead be electronic as a result of the changes under the final rule.

Generic Name. For substances that are not on the TSCA Inventory, the final rule requires that the submitter believes that the basic criteria are in some way inappropriate or inapplicable to a particular substance or generic name.  The submitter must also include an explanation for why more extensive masking of the specific chemical identity is necessary. The final rule also acknowledges that some generic names currently included with Inventory listings, particularly those whose creation pre-dates the 2016 TSCA amendments, may not meet the current requirements.  In such cases, EPA will notify the submitter and require submission of a new, compliant generic name in consultation with the submitter.

The final rule will also provide an opportunity to revise final generic names that EPA concludes are not structurally descriptive or not consistent with guidance.  EPA will provide an electronic notice of the deficiency and afford the submitter a short period of time to propose a revised generic name. If the submitter does not submit a compliant generic name, EPA will place a short hold on the submission. As a result, any applicable review period will be suspended for up to 10 business days or until the submission is amended to provide an acceptable generic name.  (After 10 days, the review period will resume, but uncorrected claims will likely be denied.)

Withdrawing Confidentiality Claims and Amending Public Copy. The final rule includes provisions with instructions for voluntarily withdrawing confidentiality claims prior to automatic expiration or denial.  The preferred approach is for the submitter to withdraw claims by amending the submission electronically. In the case that a submission was originally made on paper or the submitter does not have access to the electronic submission, claims may be withdrawn by email. Submission via CDX will increase efficiency by enabling use of a new correspondence tool that will link the withdrawal letter with the related submission, as well as permit EPA to communicate with the firm in cases that require clarification on the scope of the withdrawal.

The changes under the final rule provide an opportunity for submitters to prepare an updated public copy in response to a denial or expiration of a confidentiality claim. In such cases, the public copy of the submission requires revision to provide public access to the newly non-CBI information. Although EPA believes that submitters are in the best position to assert and protect their remaining claims, the final rule makes clear that EPA will undertake this function in the case that the submitter is unavailable or unwilling to update the public copy.  

Reporting Health and Safety Data using Templates. The final rule requires firms who submit health and safety studies or information from such studies must provide such data in templated form, using an appropriate OECD harmonized template, if such template is available for the data type (https://www.oecd.org/ehs/templates/). As a result of reporting requirements in other countries, it is expected that most submitters are familiar with and have already created templated versions of health and safety information. For firms who have already created a templated version of the health and safety information that they are submitting to EPA, the burden associated with submitting templated data only accounts for the time required to log in and upload documents. In the case that a firm does not have a templated version of study for which templates exist, firms will incur the burden required to template the data.
 Affected Universe
The final rule affects firms that assert claims for confidentiality in submissions to EPA under TSCA. Although not an exhaustive list, these firms are typically found in NAICS major groups 325 (Chemical Manufactures) and 324110 (Petroleum Refineries). Table 1 presents the expected number of firms and submissions affected by the changes under the final rule.








Table 1: Expected Number of Firms and Submissions Affected the Final Rule
                                   Activity
                                    Source
                            First Year Expectation
                          Following Years Expectation
Rule Familiarization
                             TSCA Submissions 2020
                                  1,100 firms
                                5% of 1,100 = 
                                   55 firms
CDX Registration and Electronic Signature
                 8(e), 12(b) and polymer exemption submissions
                           15% of 1,100 = 165 firms
                                   55 firms
Maintaining Company Contact Information
                             TSCA Submissions 2020
                           1,100 firms, 5 employees
                            1,100 firms, 1 employee
                             55 firms, 5 employees
Withdrawing Confidentiality Claims and Amending Public Copy 
               TSCA Submissions June 2016 through December 2020
                                  208 claims
                                  104 claims
Reporting Health and Safety Data using Templates
                        8(e), 8(d), and PMN Submissions
                                350 submissions
                                350 submissions

Rule Familiarization. EPA identified approximately 1,100 unique firms that asserted claims for confidentiality in submissions to EPA under TSCA in 2020. Therefore, it is expected that all 1,100 firms will undertake rule familiarization in the first year after the rule is finalized. Additionally, it is expected that 55 new firms (five percent of 1,100) will assert claims for confidentiality in submissions to EPA under TSCA in each following year and, therefore, undertake rule familiarization.
  
CDX Registration and Electronic Signature. It is expected that each firm will complete CDX registration and electronic signature for a total of five employees, including one manager and four technical staff members. To estimate the number of firms that will incur a one-time burden associated with CDX registration and electronic signature, EPA considers 8(e), 12(b) and polymer exemption submissions received over the last two years. Over the last two years, EPA received submissions from a total of 596 distinct firms. Of those 596 firms, 518 or approximately 86 percent were submitted by firms that were already registered under the same or similar organization name associated with the CDX registrant data. Therefore, EPA expects that 165 (15 percent of the 1,100) will undertake CDX registration and electronic signature in the first year after the rule is finalized. EPA expects that 55 new firms will undertake CDX registration and electronic signature in each following year.  

Maintaining Company Contact Information. It is expected that each of the 1,100 firms will maintain company contact information for five employees in the first year after the rule is finalized. Based on the assumption of a 20 percent turnover rate, it is expected that each of those 1,100 firms will maintain company contact information for one employee in each following year. Additionally, it is expected that 55 new firms will each maintain company contact information for a total of five employees in each following year.

Withdrawing Confidentiality Claims and Amending Public Copy. Although statistics may be compiled on the frequency and number of claim denials, it is not clear how often a firm experiencing a denial of their CBI claim will decide to invest additional effort in their submission. While a firm would have the advantage of interpreting the scope of the denial as applied to their submission, some might also decide not to perform re-redaction. Therefore, EPA uses the total number of submissions that were either later amended for any reason or those with denied claims as the upper bound for the possible number of submissions that would be withdrawn and require amended public copy. As a result of this assumption, this economic analysis may overestimate the burden associated with this activity as EPA would not expect that all of those submissions would be withdrawn. 

From June 2016 through December 2020, 952 TSCA submissions included one or more CBI claims that were denied. Therefore, EPA conservatively estimates that 208 submissions will include withdrawn claims and require submitters to amend public copy in the first year after the rule is finalized. Due to the increased clarity in reporting requirements resulting from the changes under the final rule, it is expected that claim withdrawals will occur less frequently. In each following year, it is expected that 104 submissions will include withdrawn claims and require submitters to amend public copy.

Reporting Health and Safety Data using Templates. In 2020, 330 PMNs submitted to EPA included health and safety data. EPA considers those submissions as a basis for estimating the number of templated studies submitted in a given year. Therefore, it is expected that EPA will receive 350 submissions of templated health and safety studies each year. 
 Social Burden and Cost
This chapter presents EPA's analysis of the estimated burden and cost to industry and the Agency as result of the changes under the final rule. The next sections detail the calculation of the burden and cost to industry by characterizing the applicable wage rates (Section 4.1), unit burden and cost associated with each of the activities that firms are expected undertake as a result of the final rule (Section 4.2), and the total burden and cost to industry (Section 4.3). The following section then presents the expected cost savings for the Agency by characterizing the Agency wage rate and activities impacted by the changes under the final rule (Section 4.4). Finally, the last section in this chapter presents the total annualized costs over a ten-year period (Section 4.5). 

      4.1	 Industry Wage Rates
This section presents the applicable wage rates used to estimate the cost to industry resulting from the changes under the final rule. Industry wage rates and fringe benefits for managerial, technical, and clerical labor are from the U.S. Bureau of Labor Statistics' (BLS) Employer Costs for Employee Compensation historical data for December 2022 (BLS 2023). This economic analysis also accounts for the cost of fringe benefits. Fringe benefits are specific to each labor category and include benefits such as paid leave and insurance. In addition to fringe benefits, a loading factor of 20 percent is applied to wages to account for overhead. As shown in Table 2, the loaded hourly wage is calculated by applying the fringe and overhead factors to the hourly wage.
Table 2: Industry Wage Rates (2022$)
                                Labor Category
                                 Data Series a
                                     Date
                                     Wage
                                Fringe Benefit
                              Total Compensation
                       Overhead % of Total Compensationb
                                   Overhead
                             Hourly Loaded Wages c



                                      (a)
                                      (b)
                                 (c) = (a)+(b)
                                      (d)
                                  (e)=(c)*(d)
                                  (f)=(c)+(e)
Managerial
BLS ECEC, Private Manufacturing industries, "Mgt, Business, and Financial"
                                    Dec-22
                                                                         $54.29
                                                                         $24.66
                                    $78.95 
                                      20%
                                    $15.79
                                    $94.74 
Professional / Technical
BLS ECEC, Private Manufacturing industries, "Professional and related"
                                    Dec-22
                                                                        $46.01 
                                                                        $23.27 
                                    $69.28 
                                      20%
                                    $13.86
                                    $83.14 
Clerical
BLS ECEC, Private Manufacturing industries, "Office and Administrative Support"
                                    Dec-22
                                                                        $23.11 
                                                                        $10.33 
                                    $33.44 
                                      20%
                                     $6.69
                                    $40.13 
a Source: Employer Costs for Employee Compensation December 2022 (BLS 2023).
b An overhead rate of 20% is used based on assumptions in Handbook on Valuing Changes in Time Use Induced by Regulatory Requirements and Other U.S. EPA Actions (EPA 2020b)
c Wage data are rounded to the closest cent in this analysis.

      4.2 	Respondent Activities and Associated Burden and Cost
This section presents the unit burden and cost associated with each of the activities that firms are expected to undertake as a result of the changes under the final rule. It is expected that some activities listed under the final rule will be undertaken by all firms in the affected universe and that other activities will only be undertaken in specific cases. This economic analysis accounts for the burden and cost associated with the following activities:

 Rule Familiarization
 Compliance Determination
 CDX Registration and Electronic Signature
 Maintaining Company Contact Information
 Generic Name
 Reporting Health and Safety Data using Templates
 Withdrawing Confidentiality Claims and Amending Public Copy.

      4.2.1	Rule Familiarization
Rule familiarization involves reviewing and becoming familiar with the full requirements of the rule. This activity includes reading the rule, understanding the various reporting and administrative requirements, and determining the manner in which requirements will be met. 
 
The burden associated with rule familiarization is estimated at two hours of managerial time. As shown in Table 3, the cost associated with rule familiarization is estimated at approximately $189. It is expected that all 1,100 firms in the affected universe will undertake this activity in the first year after the rule is finalized. Additionally, it is expected that 55 new firms will undertake rule familiarization in each following year.

Table 3: Unit Burden and Cost for Rule Familiarization
                                   Activity
                               Burden per Firm 
                                Cost per Firm 
                                       
                              Managerial (hours)
                               Technical (hours)
                               Clerical (hours)
                                 Total (hours)
                            Managerial ($94.74/hr)
                             Technical ($83.14/hr)
                             Clerical ($40.13/hr)
                                 Total (2022$)
Rule Familiarization
                                     2.000
                                     0.000
                                     0.000
                                     2.000
                                   $189.48 
                                    $0.00 
                                    $0.00 
                                   $189.48 
Note: Values may not sum due to rounding. Costs are rounded to the nearest penny for display purposes.

      4.2.2	Compliance Determination
Compliance determination involves a firm determining if it has asserted or will assert a claim for confidentiality in a submission to EPA under TSCA. As a firm should already know if it has asserted or will assert any claims for confidentiality, there is no burden or cost associated with this activity. 

 Electronic Reporting: CDX Registration and Electronic Signature
The final rule aims to close remaining gaps in electronic reporting by generally requiring that any submission with a CBI claim be submitted via CDX using the appropriate reporting tool. Firms that include a claim for confidentiality in a submission to EPA under TSCA must register with CDX in order to comply with electronic reporting requirements. Those firms will incur a small amount of burden and cost to carry out the additional paperwork activities that were imposed by the Electronic Reporting under the Toxic Substances Control Act (TSCA) Final Rule. This includes the burden associated with activities that facilitate submission of an electronic report: CDX registration and electronic signature. These activities occur only once for each firm. 

The one-time burden associated with CDX registration and electronic signature is estimated at approximately 2.670 hours or 160 minutes per firm. This burden is comprised of 56 minutes or approximately 0.930 hours of managerial time and 104 minutes or approximately 1.730 hours of technical time. The estimated burden associated with this activity is based on the estimates presented in the Economic Analysis of the Premanufacture Notification Electronic Reporting Final Rule (EPA 2009): 

 CDX registration. EPA estimates that a firm will incur a burden of 11 minutes or approximately 0.180 hours per employee to register with CDX, and that an average of four technical staff members and one manager will need to register for each firm, totaling 55 minutes or approximately 0.920 hours of burden per firm.
 CDX electronic signature. EPA estimates that a firm will incur a burden of 15 minutes or 0.250 hours to prepare, submit, and file an electronic signature agreement (Authentication of Identity) form to EPA per employee. This burden applies to four technical staff members and one manager per firm, totaling 1.250 hours per firm. In addition, EPA estimates that a manager will spend an additional 30 minutes or 0.500 hours accessing, preparing, and submitting verification forms (Verification of Authorization) for all authorized submitters to EPA. The total burden incurred by a firm submitting and then verifying electronic signature agreements is estimated at 105 minutes or 1.750 hours. Note that this burden does not include any additional time required to contact EPA's CDX help desk to notify a change of submitter status, should one occur. Filing the electronic signature agreement requires an additional mailing cost of $3.25 per firm (including five $0.58 stamps and five $0.07 business envelopes).
As shown in Table 4, the estimated cost of approximately $231 associated with this activity accounts for labor cost, as well as an additional $3.25 in mailing cost. EPA expects that 165 firms will incur the burden and cost associated with this activity in the first year after the rule is finalized. Additionally, it is expected that 55 new firms will incur the burden and cost associated with this activity in each following year. 
	
Table 4: Unit Burden and Cost for CDX Registration and Electronic Signature
                                   Activity
                                Burden per Firm
                                 Cost per Firm
                                       
                              Managerial (hours)
                               Technical (hours)
                               Clerical (hours)
                                Total  (hours)
                            Managerial ($94.74/hr)
                             Technical ($83.14/hr)
                             Clerical ($40.13/hr)
                                 Total (2022$)
CDX Registration
                                     0.180
                                     0.730
                                     0.000
                                     0.920
                                    $17.37 
                                    $60.97 
                                    $0.00 
                                    $78.34 
Electronic Signature
                                     0.750
                                     1.000
                                     0.000
                                     1.750
                                    $71.06 
                                    $83.14 
                                    $0.00 
                                   $154.20 
Mailing Cost (non-labor)
                                       -
                                       -
                                       -
                                       -
                                       -
                                       -
                                       -
                                    $3.25 
Total[a]
                                     0.930
                                     1.730
                                     0.000
                                     2.670
                                    $88.42 
                                   $144.11 
                                    $0.00 
                                   $235.78 
Note: Values may not sum due to rounding. Costs are rounded to the nearest penny for display purposes.
[a] Burden estimates broken down per activity and type of burden are rounded and presented in terms of hours for presentation purposes. Cost estimates are calculated using unrounded burden estimates based on the number of minutes out of an hour for each activity and type of burden.

      4.2.4	Maintaining Company Contact Information
The final rule requires maintenance of company contact information, consistent with existing CDX terms and conditions, including maintaining company contact information. The burden associated with maintaining company contact information accounts for the time taken to provide a name, phone, mailing address, email, and country. This burden is estimated at 0.006 hours, which is comprised of 0.002 hours of managerial time and 0.004 hours technical time per contact (EPA 2020a). 

In the first year after the final rule is finalized, it is expected that each of the 1,100 firms in the affected universe will maintain company contact information for a total of five employees. Additionally, it is expected that 55 new firms will each maintain company contact information for a total of five employees in each following year. As shown in Table 5, the burden associated with maintaining company contact information for five employees is estimated at 0.030 hours with an associated cost of approximately $2.61.

In each following year, each of the 1,100 firms in the affected universe is expected to update the contact information for one employee each year. Therefore, it is expected that firms will incur an annual, ongoing burden of 0.006 hours with an associated cost of approximately $0.52. The assumption of a 20 percent turnover rate each year may overstate the annual, ongoing burden.




Table 5: Unit Burden and Cost for Maintaining Company Contact Information
                                   Activity
                                Burden per Firm
                                 Cost per Firm
                                       
                              Managerial (hours)
                               Technical (hours)
                               Clerical (hours)
                                 Total (hours)
                            Managerial ($94.74/hr)
                             Technical ($83.14/hr)
                             Clerical ($40.13/hr)
                                 Total (2022$)
Five employees
                                     0.010
                                     0.020
                                     0.000
                                     0.030
                                    $0.95 
                                    $1.66 
                                    $0.00 
                                    $2.61 
One employee
                                     0.002
                                     0.004
                                     0.000
                                     0.006
                                    $0.19 
                                    $0.33 
                                    $0.00 
                                    $0.52 
Note: Values may not sum due to rounding. Costs are rounded to the nearest penny for display purposes.
[a] It is expected that 1,100 firms will each maintain company contact information for five employees in the first year after the rule is finalized. In each following year, it is expected that 55 new firms will each maintain company contact information for five employees.
[b] In each year following the first year after the rule is finalized, it is expected that each of the 1,100 firms will each maintain company contact information for one employee based on the assumption of a 20 percent turnover rate each year.

      4.2.5	Generic Name
In the case that a firm submits a generic name that does not meet EPA's requirements, EPA will provide the firm electronic notice of the deficiency and a short period of time to propose a revised generic name. The burden associated with submitting or negotiating a generic name should already be accounted for in existing ICRs. Therefore, EPA expects that the changes under the final rule will have no impact on the current burden estimate associated with submitting or negotiating a generic name. For some submissions that are made electronically after the rule is finalized, such as 12(b)s and 8(e)s, some small reduction in burden might be realized in the case that a firm is able to use an Inventory pick list to identify the chemical for which it is reporting.

      4.2.6	Withdrawing Confidentiality Claims and Amending Public Copy
Withdrawing confidentiality claims and amending public copy is typically a straightforward process that requires logging into CDX, finding the submission, and unchecking the relevant CBI boxes. However, this activity may be more involved in the case that a firm re-redacts a submission attachment or unfielded data. This is particularly the case when a firm withdraws some claims, but not all of them. 

Recently, many voluntary claim withdrawals have been the result of enforcing the upfront substantiation requirement. In these cases, EPA staff outreach to firms suggesting that certain documents are over-redacted, substantiation is missing, or substantiation is clearly inadequate for a given claim. This outreach typically results in the claim being withdrawn. Several factors are expected to significantly reduce the number of procedurally deficient, poorly considered, or otherwise inappropriate CBI claims including further clarification of substantiation requirements in new rules, enhancements of existing forms and the expansion of electronic reporting requirements, and the ability to electronically validate CBI claims with enhancements of existing forms and expansion of electronic reporting requirements. As a result of the changes under the final rule, it is expected that voluntary claim withdrawals will occur less frequently.

In the event that a claim is denied, the changes under the final rule encourage firms to undertake revisions of public copy. Amending public copy typically involves unchecking one or a few boxes in an electronic document. In such cases, it is expected that the burden for completing this activity would be five minutes or approximately 0.083 hours. For some TSCA submissions, the denied or expired claims may be intermingled with still valid or approved claims, or the claims may have been indicated by numerous redactions throughout a voluminous text. In such cases, either EPA or the submitter would have to undertake a page-by-page review of a voluminous filing to manually re-redact public copy. In that case, it is expected that the burden for completing this activity would be one hour. Of the 416 cases of denials or denials in part, only approximately eight submissions, or two percent, required the more extensive burden estimate.

The unit burden associated with this activity is estimated at 0.129 hours of technical burden. As shown in Table 6, the cost associated with withdrawing confidentiality claims and amending public copy is estimated at approximately $11. Given the changes under the final rule, it is expected that claim withdrawals will occur less frequently. Therefore, EPA expects that 208 claims for confidentiality will be withdrawn in the first year after the rule is finalized and 104 claims will be withdrawn in each following year.

Table 6: Unit Burden and Cost for Withdrawing Confidentiality Claims and Amending Public Copy
                                   Activity
                                Burden per Firm
                                 Cost per Firm
                                       
                              Managerial (hours)
                               Technical (hours)
                               Clerical (hours)
                                 Total (hours)
                            Managerial ($94.74/hr)
                             Technical ($83.14/hr)
                             Clerical ($40.13/hr)
                                 Total (2022$)
Withdrawing Confidentiality Claims
                                     0.000
                                     0.129
                                     0.000
                                     0.129
                                    $0.00 
                                    $10.73 
                                    $0.00 
                                    $10.73 
Note: Values may not sum due to rounding. Costs are rounded to the nearest penny for display purposes.

      4.2.7	Reporting Health and Safety Data using Templates
The final rule requires firms who submit health and safety studies or information from such studies must provide such data in templated form, using an appropriate OECD harmonized template, if such template is available for the data type. As a result of reporting requirements in other countries, it is expected that most firms submitting health safety studies to EPA will have already created templated versions of health and safety information. 

It is expected that 95 percent of submissions of health and safety data using templates will require a burden of approximately three minutes or 0.050 hours of technical time to log in and upload documents. It is expected that five percent of submissions will require a burden of 12 hours of technical time to create a templated version of the health and safety data being submitted to EPA.  As shown in Table 7, the burden to submit health and safety studies using templates is estimated at 0.700 hours of technical time per submission with an associated cost of approximately $58.  It is expected that EPA will receive 350 submissions of templated health and safety data annually.

Table 7: Unit Burden and Cost for Reporting Health and Safety Data using Templates
                                   Activity
                                Burden per Firm
                                 Cost per Firm
                                       
                              Managerial (hours)
                               Technical (hours)
                               Clerical (hours)
                                 Total (hours)
                            Managerial ($94.74/hr)
                             Technical ($83.14/hr)
                             Clerical ($40.13/hr)
                                 Total (2022$)
Reporting Health and Safety Data using Templates
                                     0.000
                                     0.700
                                     0.000
                                     0.700
                                    $0.00 
                                    $58.20 
                                    $0.00 
                                    $58.20 
Note: Values may not sum due to rounding. Costs are rounded to the nearest penny for display purposes.
 Total Burden and Cost to Industry 
Table 8 presents the estimate burden and cost to industry as a result of the changes under the final rule. The total burden and cost to industry is calculated by multiplying the unit burden and cost for each activity, as presented in section 4.2, by the number of firms expected to undertake each activity and then summing across all of the listed activities.

As a result of the changes under the final rule, industry is expected to incur a one-time burden of approximately 2,945 hours with an associated cost of approximately $272,804 in the first year after the final rule is finalized. In each following year, industry is expected to incur an annual, ongoing burden of approximately 523 hours with an associated cost of approximately $45,592.

Table 8: Total Change in Burden and Cost to Industry 
                                   Activity
                          Number of Affected Entities
                              Unit Burden (hours)
                             Total Burden (hours)
                               Unit Cost (2022$)
                              Total Cost (2022$)
                             First year, One-time
Rule Familiarization
                                     1,100
                                     2.000
                                     2,200
                                   $189.48 
                                   $208,428 
CDX Registration and Electronic Signature
                                      165
                                     2.670
                                      440
                                   $235.78 
                                   $38,904 
Maintaining Company Contact Information
                                     1,100
                                     0.030
                                      33
                                    $2.61 
                                    $2,871 
Withdrawing Confidentiality Claims and Amending Public Copy 
                                      208
                                     0.129
                                      27
                                    $10.73 
                                    $2,231 
Reporting Health and Safety Data using Templates
                                      350
                                     0.700
                                      245
                                    $58.20 
                                   $20,369 
One-time, First Year
                                       
                                       
                                  2,945 hours
                                       
                                   $272,804 
                     Annual, Ongoing after the First Year
Rule Familiarization
                                      55
                                     2.000
                                      110
                                   $189.48 
                                   $10,421 
CDX Registration and Electronic Signature
                                      55
                                     2.670
                                      147
                                   $235.78 
                                   $12,968 
Maintaining Company Contact Information
                                     1,100
                                     0.006
                                       7
                                    $0.52 
                                     $574 

                                      55
                                     0.030
                                       2
                                    $2.61 
                                     $144 
Withdrawing Confidentiality Claims and Amending Public Copy
                                      104
                                     0.129
                                      13
                                    $10.73 
                                    $1,115 
Reporting Health and Safety Data using Templates
                                      350
                                     0.700
                                      245
                                    $58.20 
                                   $20,369 
Annual, Ongoing
                                       
                                       
                                   523 hours
                                       
                                   $45,592 
Note: Values may not sum due to rounding. Total industry burden and cost are calculated using unrounded numbers and then rounded to the nearest hour and dollar, respectively. Activities without burden (compliance determination and generic name) are not listed in the table. 
 
 Agency Burden and Cost
This section presents the estimated change in burden and cost to the Agency resulting from the changes under the final rule. The following subsections characterize the cost savings to the Agency by presenting the Agency wage rate and the Agency activities impacted by the changes under the final rule.
      4.4.1	Agency Wage Rate
This section presents the applicable Agency wage rate used to calculate the change in cost to the Agency resulting from the final rule. The activities undertaken by the Agency are assumed to be accomplished by a GS 13, Step 5 federal employee (EPA 2018). Table 9 details the calculation of the loaded hourly wage rate for a GS 13, Step 5 federal employee. The 2022 loaded hourly wage rate for this level of employee in the Washington, D.C. locality is estimated at $114.48. 

Table 9: Agency Wage Rate (2022$)
                                Labor Category
                       Data Source for Wage Information
                                 Wage ($/hour)
                              Fringes as % wageb
                                Fringe Benefit
                              Total Compensation
                       Overhead as % total compensationc
                                   Overhead
                              Loaded Wage ($/hr)


                                      (a)
                                      (b)
                                 (c) = (a)*(b)
                                 (d) = (a)+(c)
                                      (e)
                                (f) = (d)*(e) 
                                 (g) = (d)+(f)
EPA staff
Annual federal staff cost: OPM Washington-Baltimore-Northern Virginia, DC-MD-PA-VA-WV area, GS-13 Step 5 pay rates a
                                    $58.20 
                                    63.90%
                                    $37.19 
                                    $95.40 
                                      20%
                                    $19.08 
                                   $114.48 









Note: Values may not sum due to rounding. Costs are rounded to the nearest penny for display purposes.
a Source: U.S. Office of Personnel Management (2022). Salary Table 2022-DCB. Retrieved from Pay & Leave: Salaries & Wages: https://www.opm.gov/policy-data-oversight/pay-leave/salaries-wages/salary-tables/pdf/2022/DCB.pdf.
[b] Source: Falk (2012). "Comparing Benefits and Total Compensation in the Federal Government and the Private Sector." Congressional Budget Office Working Paper Series. https://www.cbo.gov/sites/default/files/112th-congress-2011-2012/workingpaper/2012-04fedbenefitswp0.pdf
[c] An overhead rate of 20% is used based on assumptions in Handbook on Valuing Changes in Time Use Induced by Regulatory Requirements and Other U.S. EPA Actions (EPA 2020b).

      4.4.2	Agency Cost Savings
Table 10 presents the change in burden and cost to the Agency. As a result of the changes under the final rule, it is expected that the Agency will experience an annual cost savings of approximately $75,710. As not all changes in burden and cost to the Agency are quantifiable, this estimate may understate the cost savings to the Agency. The following discussion details the change in Agency burden and cost resulting from the changes under the final rule.

Electronic Reporting. By requiring that nearly all TSCA confidentiality claims assert in submissions under TSCA must be submitted electronically, the Agency is expected to experience a reduction in the cost associated with mail/packaging receipt ($20.50 per submission) and a reduction in the burden associated with scanning, filing and most data entry burden (15 minutes per submission). Additionally, the Agency is expected to experience a reduction in burden associated with generating and mailing paper acknowledgement letters (13 minutes per letter). 

In 2019, EPA received a total of 131 paper 8(e) submissions. Since June of 2016, EPA received 68 chemID-only reviews on 12(b)s and 178 chemID and 25% reviews. In 2020, EPA received a total of 231 polymer exemption reports. Therefore, in absence of the final rule, EPA would expect to continue to receive approximately 800 paper submissions annually. Therefore, the burden and cost savings resulting from the electronic reporting requirements discussed above is expected to impact 800 submissions annually.

The Agency is also expected to experience a reduction in burden associated with generating rejection and incomplete letters. Currently staff estimate that generating these notifications on paper currently takes 10 minutes per communication. By further automating this process, this activity is expected to only take five minutes. Based on the number of rejection letters and complete letters generated in 2020, it is expected that this burden savings would be applicable to 81 submissions annually.

The use of the 12(b) list will greatly reduce the pre-screening effort, but will require that the list is incorporated into CIS/CDX and made readily editable. Currently, maintaining the 12(b) list requires an extensive effort once or twice a year. As a result of the final rule, this process is expected to be much simpler process in which the list is updated on a more regular basis. Although it is expected that the Agency will experience a reduction in the burden associated with this activity, this reduction is not quantifiable.

Additionally, the reliance on the 12(b) list will eliminate the need for chemistry review or additional analysis to either identify substances in a 12(b) submission or to connect an ambiguous submission to an actual 12(b) reporting requirement for all such submission except 12(b) reportable categories of chemicals (the occasional submission that fits into a category would likely require free text to identify the substance).  Matching or verifying a chemical can take only a few seconds in cases that the submission is unambiguous and includes a CASRN and up to approximately 15 minutes in cases that the chemical name includes errors or other issues hinder verification against the 12(b) list. As a result of the changes under the final rule, this burden would be eliminated. Because EPA is not able to estimate the frequency at which it will experience the reduction in burden associated with this activity, it is not reflected in the estimates presented in Table 10.

The current format for polymer exemption submissions via a letter requires that some submissions are reviewed for CBI claims. The changes under the final rule will reduce the CBI review workload by eliminating claim review for information that is not required to be reported (e.g., specific chemical identity).  It is expected that the Agency will experience a reduction in burden of approximately 30 minutes for each submission to determine if CBI review is necessary. On average, EPA receives 12 polymer exemptions that are reviewed to determine if CBI is necessary. The Agency is also expected to experience a reduction in burden as the annual statistics on the use of polymer exemption are more readily complied from electronic reports.

Maintaining Company Contact Information. By requiring that firms maintain company contact information, the Agency is expected to experience a reduction in burden associated with searching for contacts in circumstances where a notice is returned as undeliverable. In light of the significant resources and document tracking concerns related to continuing to largely rely on paper correspondence for such communication and notifications, this correspondence would instead be electronic as a result of the changes under the final rule. 

On average, there is a total of 66 undelivered denials annually. In such cases, it is estimated that the Agency may dedicate up to 2 hours searching for contact information. The burden estimate of two hours takes into account making multiple phone calls, sending follow up emails, moving and sending documents, and recordkeeping. It should also be noted that, despite those efforts, some denial notifications will remain undeliverable. As a result of the changes under the final rule, it is expected that this burden will be eliminated. 
Table 10: Total Change in Burden and Cost to the Agency (2022$)		 
                                   Activity 
                               Annual Frequency
                      Reduction in Burden per Submission
                         Total Change in Agency Burden
                       Reduction in Cost per Submission
                      Total Change in Agency Cost (2022$)
Electronic Reporting
                            Mail/packaging receipt
                                      800
                                       -
                                       -
                                    $20.50 
                                   $16,400 

                  Scanning, filing and most data entry burden
                                      800
                                  15 minutes
                                   200 hours
                                    $28.62 
                                   $22,896 

             Generating and mailing paper acknowledgement letters
                                      800
                                  13 minutes
                                   173 hours
                                    $24.80 
                                   $19,843 

              Generating rejection letters and incomplete letters
                                      81
                                   5 minutes
                                  6.75 hours
                                    $9.54 
                                     $773 

                     Review of polymer exemptions for CBI
                                      12
                                  30 minutes
                                    6 hours
                                    $57.24 
                                     $687 
Maintaining Company Contact Information
                                      66
                                    2 hours
                                   132 hours
                                   $228.96 
                                   $15,111 
Total Annual Cost Savings                                             518 hours
                                    $75,710
Note: Values may not sum due to rounding. Costs are rounded to the nearest penny for display purposes.
 
 Total Annualized Costs
Pursuant to guidance, federal agencies should consider when costs and benefits will actually occur. Thus, costs and benefits that will accrue in the future must be discounted to present day dollars. OMB's guidance recommends federal agencies use discount rates of three and seven percent to estimate a range of average potential returns on investments. Table 11 displays the annualized costs based on costs occurring over a ten-year period, including one-time costs incurred the first year after the rule is finalized and annual, ongoing costs incurred in following years.

Table 11: Total Annualized Costs
                                  Cost Category
                                      3%
                                      7%
Annualized Industry Cost
                                   $71,452 
                                   $75,825 
Annualized Agency Cost Savings
                                   $75,710 
                                   $75,710 
Note: Values may not sum due to rounding. Total costs are rounded to the nearest dollar for display purposes. 
 Benefits
The changes under the final rule are expected to generate benefits for industry, the Agency, and the public. The final rule is expected to increase efficiency for industry by specifying procedures for the assertion and maintenance of CBI claims that were previously ad hoc activities. The final rule is also expected to improve to EPA's management of CBI, specifically in cases of incomplete submissions or deficient claims. Additionally, it is expected that EPA will be able to more accurately delineate CBI and, as a result, increase public transparency for chemical information.

Closing gaps in electronic reporting is intended to reduce the likelihood of submitter error when asserting or maintaining a claim for confidentiality, facilitate public access to information not claimed as CBI, and prevent the submission of unnecessary or not required information. These changes will also aid EPA in reviewing confidentiality claims in a timely manner and lessen the opportunity for errors related to the handling of confidential information. Additionally, these changes will reduce resources required to process, handle, and store TSCA submissions.

Closing gaps in electronic reporting also provides a secure means of communication. Previously, EPA was not able to track communication or verify the fact and date of receipt when communicating via mail. By using CDX instead of certified mail or a courier, EPA can more readily assure that communication is available to submitters. Additionally, by requiring maintenance of CDX accounts, including maintaining company contact information, EPA will be able to maintain contact with the submitter in the case that the original contact has changed.
 Small Entity Impact Analysis
This chapter evaluates the impact that the final rule may have on small entities by examining the
relationship between expected compliance costs and revenues for small businesses.

To evaluate the impact that the final rule may have on small entities, EPA considers the estimated cost that an individual firm may incur as a result of the changes under the final rule and the level of revenue at which that cost exceeds one and three percent of revenue. The general methodology used to estimate impacts on small entities consists of the following steps, and are presented in further detail below:

 Estimate the number and percentage of firms that are small
 Estimate compliance cost for affected small entities
 Estimate the distribution of annual revenues for small entities
 Estimate the cost-to-revenue ratio for small entities.

1. 	Estimate the number and percentage of firms that are small
The Regulatory Flexibility Act (RFA) relies on the definition of "small business" found in the Small Business Act, which authorizes the Small Business Administration (SBA) to develop definitions for "small businesses" for industries in each North American Industry Classification System (NAICS) code. These definitions can be based either on a company's number of employees or its sales, depending on SBA's criteria for that industry (U.S. Small Business Administration 2022).

The final rule is expected to affect firms in the following NAICS: 325 (Chemical Manufacturers) and 324110 (Petroleum Refineries). The total number of firms in these industries and the corresponding small business definitions are presented in Table 12. The estimated average percentage of small firms across all potentially affected industries, weighted by the number of firms in each industry, is 91 percent.

Table 12. Percentage of Small Firms Among Potentially Affected Firms
                                     NAICS
                               NAICS Description
                             Total Number of Firms
              Small business size standard (number of employees)
                              Percent Small Firms
                                                                         324110
Petroleum Refineries
                                      83
                                     1,500
                                      63%
                                                                         325110
Petrochemical Manufacturing
                                      31
                                     1,000
                                      48%
                                                                         325120
Industrial Gas Manufacturing
                                      78
                                     1,000
                                      82%
                                                                         325130
Synthetic Dye and Pigment Manufacturing
                                      103
                                     1,000
                                      87%
                                                                         325180
Other Basic Inorganic Chemical Manufacturing
                                      376
                                     1,000
                                      82%
                                                                         325193
Ethyl Alcohol Manufacturing
                                      117
                                     1,000
                                      88%
                                                                         325194
Cyclic Crude, Intermediate, and Gum and Wood Chemical Manufacturing
                                      49
                                     1,250
                                      65%
                                                                         325199
All Other Basic Organic Chemical Manufacturing
                                      608
                                     1,250
                                      87%
                                                                         325211
Plastics Material and Resin Manufacturing
                                      856
                                     1,250
                                      90%
                                                                         325212
Synthetic Rubber Manufacturing
                                      137
                                     1,000
                                      82%
                                                                         325220
Artificial and Synthetic Fibers and Filaments Manufacturing
                                      114
                                     1,000
                                      79%
                                                                         325311
Nitrogenous Fertilizer Manufacturing
                                      165
                                     1,000
                                      91%
                                                                         325312
Phosphatic Fertilizer Manufacturing
                                      44
                                      750
                                      80%
                                                                         325314
Fertilizer (Mixing Only) Manufacturing
                                      371
                                      500
                                      95%
                                                                         325320
Pesticide and Other Agricultural Chemical Manufacturing
                                      184
                                     1,000
                                      90%
                                                                         325411
Medicinal and Botanical Manufacturing
                                      597
                                     1,000
                                      95%
                                                                         325412
Pharmaceutical Preparation Manufacturing
                                     1,117
                                     1,250
                                      94%
                                                                         325413
In-Vitro Diagnostic Substance Manufacturing
                                      189
                                     1,250
                                      88%
                                                                         325414
Biological Product (except Diagnostic) Manufacturing
                                      276
                                     1,250
                                      84%
                                                                         325510
Paint and Coating Manufacturing
                                      958
                                     1,000
                                      96%
                                                                         325520
Adhesive Manufacturing
                                      401
                                      500
                                      86%
                                                                         325611
Soap and Other Detergent Manufacturing
                                      631
                                     1,000
                                      96%
                                                                         325612
Polish and Other Sanitation Good Manufacturing
                                      428
                                      750
                                      96%
                                                                         325613
Surface Active Agent Manufacturing
                                      108
                                      750
                                      85%
                                                                         325620
Toilet Preparation Manufacturing
                                     1,010
                                     1,250
                                      97%
                                                                         325910
Printing Ink Manufacturing
                                      162
                                      500
                                      90%
                                                                         325920
Explosives Manufacturing
                                      53
                                      750
                                      72%
                                                                         325991
Custom Compounding of Purchased Resins
                                      347
                                      500
                                      88%
                                                                         325992
Photographic Film, Paper, Plate, and Chemical Manufacturing
                                      163
                                     1,500
                                      93%
                                                                         325998
All Other Miscellaneous Chemical Product and Preparation Manufacturing
                                     1,072
                                      500
                                      91%
Source: U.S. Census Bureau 2022; U.S. Small Business Administration 2022

To estimate the percentage of firms in the industries that are small, EPA used the U.S. Census' 2019 Statistics of U.S. Businesses (SUSB) by detailed employment size to estimate the percentage of that are small (U.S. Census Bureau 2022). It is assumed that firms are uniformly distributed within an employment size bracket. For example, if a small business threshold is the midpoint of an employment bracket, then it is assumed that half of firms in that bracket are small.

2.	Estimate compliance costs for affected small entities
To estimate the impact that the final rule may have on small entities, EPA considers the cost that an individual firm may incur when completing all of the listed activities considered in this economic analysis. Table 13 summarizes the per-firm compliance costs that EPA expects that firms will incur as a result of the final rule. 

This small entity impact analysis takes into considers a compliance cost of approximately $488. However, the compliance cost considered in this analysis most likely overestimates the average cost per firm. Unit burden and cost estimates associated with withdrawing claims and amending public copy and submission of templated data are measured on a per submission basis rather than a per firm basis. When averaging out the expected number of submissions across 1,100 firms, both average submissions per firm would be less than one. Additionally, most firms in the affected universe will only undertake rule familiarization and maintain company contract information for five employees. The cost associated with undertaking those activities is estimated at approximately $192. Lastly, as smaller firms are likely to make less submissions and/or claims for confidentiality relative to larger firms, it is expected that they will undertake the listed activities less often than relatively larger firms. 
 
Table 13: Per-Firm Compliance Costs (2022$)
Notice Type
                                 Cost Per Firm
                   Revenue for Costs to Equal 1% of Revenue
                   Revenue for Costs to Equal 3% of Revenue
Rule Familiarization and Maintaining Contact Information (five employees)
                                   $192.09 
                                   $19,209 
                                    $6,403 
All Activities
                                   $496.80 
                                   $49,680 
                                   $16,560 
 
3.	Estimate the distribution of annual revenues for small entities
This analysis estimates a distribution of revenues for NAICS 324110 and 325 using data on annual receipts per firm from the 2017 SUSB (Statistics for United States Businesses) (U.S. Census Bureau 2021). The SUSB data divides firms into 17 revenue brackets according to the firm's annual receipts, which are defined as "all revenue in whatever form received or accrued from whatever source, including from the sales of products or services" from all affiliates in a given year (13 CFR §121.104). Table 14 shows the distribution of firms in the affected NAICS, by revenue bracket.

Table 14. Number of Firms by Revenue Bracket (2017$)
                           Annual Revenue Bracket[1]
                           Number of Firms, by NAICS

                                    324110
                                      325
< $100,000[2]
                                                                              0
                                                                            559
$100,000 - $499,999
                                                                              4
                                                                          1,405
$500,000 - $999,999
                                                                              0
                                                                            759
$1,000,000 - $2,499,999
                                                                              0
                                                                          1,672
$2,500,000 - $4,999,999
                                                                              0
                                                                          1,240
$5,000,000 - $7,499,999
                                                                              0
                                                                            658
$7,500,000 - $9,999,999
                                                                              0
                                                                            413
$10,000,000 - $14,999,999
                                                                              0
                                                                            535
$15,000,000 - $19,999,999
                                                                              0
                                                                            277
$20,000,000 - $24,999,999
                                                                              0
                                                                            200
$25,000,000 - $29,999,999
                                                                              0
                                                                            173
$30,000,000 - $34,999,999
                                                                              0
                                                                            133
$35,000,000 - $39,999,999
                                                                              0
                                                                            119
$40,000,000 - $49,999,999
                                                                              0
                                                                            133
$50,000,000 - $74,999,999
                                                                              0
                                                                            234
$75,000,000 - $99,999,999
                                                                              0
                                                                            173
$100,000,000 +
                                                                             53
                                                                          1,038
Total
                                                                             57
                                                                          9,721
Source: U.S. Census Bureau 2021
[1] Revenues are later inflated to 2021$ to calculate the revenue distributions used to estimate cost-revenue ratios (BEA 2022)
[2] Minimum revenue estimated as $84,656
 
Note that the lowest revenue bracket in the SUSB data has a minimum revenue of zero. However, no affected firms are expected to have zero revenue. Therefore, EPA estimates a minimum revenue to use as a revenue floor for the first revenue bracket. The minimum revenue is estimated as the cost of employing one part-time technical worker (0.5 FTE). The loaded wage rate for technical workers is approximately $83.14 (see Table 2), which equates to an annual salary of $86,466 for an employee working 20 hours a week for 52 weeks a year.

Using the revenue brackets and firm counts from Table 14, the annual revenue distribution for affected small entities is estimated by assuming that revenues are uniformly distributed within the revenue brackets. Estimated revenue distributions at the 1[st], 5[th], 25[th], 50[th], and 75[th] percentile for entities across all potentially affected NAICS are presented in Table 15.

Table 15: Revenue Distribution for Affected Small Entities (2022$)
                                     NAICS
                                1st Percentile
                                5th Percentile
                                25th Percentile
                                50th Percentile
                                75th Percentile
324110 (Petroleum Refineries)
                                                                      $185,377 
                                                                      $454,586 
                                                                  $323,590,728 
                                                                  $609,308,530 
                                                                  $895,026,333 
325 (Chemical Manufacturers)
                                                                       $91,962 
                                                                      $113,948 
                                                                      $953,034 
                                                                    $4,059,998 
                                                                   $18,771,487 

4.	Estimate the cost-to-revenue ratio for small entities
Table 16 presents a summarizes the small entity impact analysis associated with the final rule. To estimate the percentage of small firms at each cost-impact ratio, the revenue thresholds for one and three percent cost impacts presented in Table 13 are compared against the full percentile revenue distribution summarized in Table 15. For example, the one percent cost-revenue impact threshold for firms undertaking all activities is $49,680. Based on the revenue distribution summarized in Table 15, revenues at the 1st percentile ($185,377 and $91,962 for NAICS 324110 and 325, respectively) are above this threshold. Thus, EPA estimates that all small firms will have cost impacts of less than one percent of annual revenue. 
 
Table 16: Small Entity Impact Analysis
                                     NAICS
                             Total Number of Firms
                                 Percent Small
                             Number of Small Firms
            Number and Percent of Small Firms by Cost-Impact Ratio




                                    <1%
                                     1-3%
                                    >3%
324110 (Petroleum Refineries)
                                       8
                                      63%
                                       5
                                   5 (100%)
                                    0 (0%)
                                    0 (0%)
325 (Chemical Manufacturers)
                                     1,092
                                      91%
                                      996
                                  996 (100%)
                                    0 (0%)
                                    0 (0%)
Total
                                     1,100
                                      91%
                                     1,001
                                 1,001 (100%)
                                    0 (0%)
                                    0 (0%)

 Sensitivity Analysis
As the number of firms and submissions affected by the changes under the final rule is unknown, this economic analysis draws from the available data to estimate the expected number of affected firms and submissions. To account for the case in which the main analysis underestimates the expected number of firms and submissions affected by the changes under the final rule, this sensitivity analysis estimates a high-end burden and cost estimate. The high-end estimate considers the burden and cost to industry in the case that the number of firms and submissions affected by the final rule are double that of the expectations considered in the main analysis. 
 
Table 17 presents the high-end burden and cost to industry. The high-end estimate includes the expectation that a total of 2,200 firms will undertake rule familiarization and maintain company contact for five employees in the first year after the rule is finalized. It is expected that each of those 2,200 firms will maintain company contact information for one employee in each of the following years. It is also expected that 330 of those firms will complete CDX registration and electronic signature in the first year after the rule is finalized. In each following year, it is expected that 110 new firms will make claims for confidentiality and, therefore, undertake rule familiarization and maintain contact information for five employees.
 
The high-end estimate includes the expectation that 416 claims for confidentiality will be withdrawn in the first year after the rule is finalized and that 208 claims will be withdrawn in each following year. Additionally, it is expected that EPA will receive 700 templated health and safety studies annually.
 
In the case that the number of firms and submissions affected by the final rule is double that of the expectation considered in the main analysis, industry is expected to incur a one-time burden of approximately 5,890 hours with an associated cost of approximately $545,607 in the first year after the rule is finalized. In each following year, industry is expected to incur an annual, ongoing burden of approximately 1,047 hours with an associated cost of approximately $91,184.
 

Table 17: Sensitivity Analysis: High-End Burden and Cost Estimates
                                   Activity
                          Number of Affected Entities
                              Unit Burden (hours)
                             Total Burden (hours)
                               Unit Cost (2022$)
                              Total Cost (2022$)
                             First year, One-time
Rule Familiarization
                                     2,200
                                     2.000
                                     4,400
                                   $189.48 
                                   $416,856 
CDX Registration and Electronic Signature
                                      330
                                     2.670
                                      880
                                   $235.78 
                                   $77,809 
Maintaining Company Contact Information
                                     2,200
                                     0.030
                                      66
                                    $2.61 
                                    $5,742 
Withdrawing Confidentiality Claims and Amending Public Copy 
                                      416
                                     0.129
                                      54
                                    $10.73 
                                    $4,462 
Reporting Health and Safety Data using Templates
                                      700
                                     0.700
                                      490
                                    $58.20 
                                   $40,739 
One-time, First Year
                                        
                                        
                                  5,890 hours
                                       
                                   $545,607 
                     Annual, Ongoing after the First Year
Rule Familiarization
                                      110
                                     2.000
                                      220
                                   $189.48 
                                   $20,843 
CDX Registration and Electronic Signature
                                      110
                                     2.670
                                      293
                                   $235.78 
                                   $25,936 
Maintaining Company Contact Information
                                     2,200
                                     0.006
                                      13
                                    $0.52 
                                    $1,148 

                                      110
                                     0.030
                                       3
                                    $2.61 
                                     $287 
Withdrawing Confidentiality Claims and Amending Public Copy
                                      208
                                     0.129
                                      27
                                    $10.73 
                                    $2,231 
Reporting Health and Safety Data using Templates
                                      700
                                     0.700
                                      490
                                    $58.20 
                                   $40,739 
Annual, Ongoing
                                        
                                        
                                  1,047 hours
                                       
                                   $91,184 
Note: Values may not sum due to rounding. Total industry burden and cost are calculated using unrounded numbers and then rounded to the nearest hour and dollar, respectively. Activities without burden (compliance determination and generic name) are not listed in the table.
 Additional Analyses
This chapter discusses several statues and EOs that pertain to the final rule.

 Paperwork Reduction Act
According to the Paperwork Reduction Act, 44 USC 3501 et seq., federal agencies are required to
estimate the reporting burden that would be imposed by a rule. In this context, the term "burden" means
the total time, effort, or financial resources expended by persons to generate, maintain, retain, or disclose
or provide information to or for a federal agency. This includes time needed to review instructions;
develop, acquire, install, and utilize technology and systems for the purposes of collecting, validating, and verifying information, processing, and maintaining information, and disclosing and providing
information; adjust the existing ways to comply with any previously applicable instructions and
requirements, train personnel to be able to respond to a collection of information; search data sources;
complete and review the collection of information; and transmit or otherwise disclose the information.

      8.1.1 Industry Burden
Under the final rule, firms may undertake the following activities:

 Rule Familiarization
 Compliance Determination
 CDX Registration and Electronic Signature
 Maintain Company Contact Information
 Generic Name
 Withdrawing Confidentiality Claims and Amending Public Copy
 Reporting Health and Safety Data using Templates. 

The listed activities include activities undertaken by all impacted entities and others that are undertaken in cases of incomplete submissions or deficient claims. Under the final rule, industry is conservatively estimated to incur a burden of approximately 2,945 hours in the first year after the rule is finalized and 523 hours annually in following years. 

      8.1.2. Government Burden
The final rule to establish new and amended requirements concerning the assertion and treatment of CBI claims to EPA under TSCA. As a result of the changes under the final rule, the Agency is expected to experience a reduction in burden of 518 hours annually. 

  Unfunded Mandates Reform Act
This action does not contain an unfunded mandate as described in the Unfunded Mandates Reform Act (UMRA), 2 U.S.C. 1531-1538, and does not significantly or uniquely affect small governments. The action is not expected to impose enforceable duty on any state, local or tribal governments, and the requirements imposed on the private sector are not expected to result in annual expenditures of $100 million or more for the private sector. As such, EPA has determined that the requirements of UMRA sections 202, 203, 204, or 205 do not apply to this action.

 Executive Order 13132: Federalism
Under Executive Order 13132, "Federalism" (64 FR 43255, August 10, 1999), EPA has determined that
the final rule does not have "federalism implications" because it will not have substantial direct effects on the states, on the relationship between the national government and the states, or on the distribution of power and responsibilities among the various levels of government, as specified in the executive order. The final rule establishes new and amended requirements concerning the assertion and treatment of CBI claims to EPA under TSCA. Because EPA has no information to indicate that any state or local government manufacturers the chemical substances covered by this action, the final rule does not apply directly to states and localities and will not affect state and local governments. Thus, EO 13132 does not apply to the final rule.

  Executive Order 13175: Consultation and Coordination with Indian Tribal Governments
As required by Executive Order 13175, entitled Consultation and Coordination with Indian Tribal
Governments (65 FR 67249, November 9, 2000), EPA has determined that the final rule does not have tribal implications because it will not have any effect on tribal governments, on the relationship between the federal government and the Indian tribes, or on the distribution of power and responsibilities between the federal government and Indian tribes, as specified in the Order. Thus, EO 13175 does not apply to the final rule.

  Executive Order 13045: Protection of Children from Environmental Health Risks and Safety Risks
EPA interprets Executive Order 13045 (62 FR 19885, April 23, 1997) as applying only to those regulatory actions that concern environmental health or safety risks that the EPA has reason to believe may disproportionately affect children, per the definition of "covered regulatory action" in section 2 - 202 of Executive Order 13045. This action is not subject to Executive Order 13045 because it does not concern environmental health risk or safety risk.

  Executive Order 13211: Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use
This action is not a "significant energy action" as defined in Executive Order 13211 (66 FR 28355, May 22, 2001), because it is not likely to have a significant adverse effect on energy supply, distribution, or use.

  National Technology Transfer and Advancement Act 
Since this action does not involve any technical standards, National Technology Transfer and Advancement Act (NTTAA) section 12(d), 15 U.S.C. 272 note, does not apply to this action.

  Executive Order 12898: Federal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations

Executive Order 12898 (59 FR 7629, February 16, 1994) directs Federal agencies, to the greatest extent practicable and permitted by law, to make environmental justice part of their mission by identifying and addressing, as appropriate, disproportionately high and adverse human health or environmental effects of their programs, policies, and activities on minority populations (people of color and/or indigenous peoples) and low-income populations.

EPA believes that this action does not directly concern human health or environmental conditions and therefore cannot reasonably be evaluated with respect to potentially disproportionate and adverse effects on people of color, low-income populations and/or indigenous peoples. This action does not directly address any human health or environmental risks and does not directly affect the level of protection provided to human health or the environment. However, although this action does not directly concern human health or environmental conditions, in setting clear procedures for confidentiality claims made by reporting entities under TSCA, this action is expected to improve the quality of such claims, reduce unnecessary and unsupported claims, and is anticipated to result in more information being available to the public. By ensuring uniform substantiation of CBI claims, electronic reporting requirements, certification statements, clarifying how EPA treats certain information initially obtained in a context other than TSCA, and the process for maintenance or withdrawal of confidentiality claims, EPA is improving communications and transparency to the public and promoting consistency for the regulated community. Improved communication and transparency has inherent informational benefits including increasing understanding and awareness of potential issues related to chemical information.  Information submitted under TSCA can also be used by government agencies and others to identify potential problems, set priorities, and take appropriate steps to reduce any potential risks to human health and the environment and as noted in this paragraph, may make more of this information available to the public. Therefore, the informational benefits of the action are likely to have a positive impact on the human health and environmental impacts of all populations, including minority populations, low-income populations, and indigenous peoples. 

 Executive Order: Congressional Review Act 

This action is subject to the CRA, 5 U.S.C. 801 et. seq., and the EPA will submit a rule report to each House of the Congress and to the Comptroller General of the United States. This action is not a "major rule" as defined by 5 U.S.C. 804(2).  
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