OSHA

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OSHAs Proposed Chrome PELSFIC Washington
ForumWashington, DCMay 11, 2005

• Jeff Hannapel Stu Sessions
• The Policy Group Environomics, Inc.
• One Thomas Circle, NW, 10th Floor 4405 East-West
  Highway, Ste 307
• Washington, DC 20005 Bethesda, Maryland 20814
• 202-457-0630 301-657-7762
• jhannapel_at_thepolicygroup.com sessions_at_environomics
  .com

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OSHA Proposed PEL Background Summary

• Litigation by Public Citizen and Unions
• Current PEL 52 ug/m3
• Proposed PEL 1ug/m3
• Proposed Action Level 0.5 ug/m3

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OSHA Regulatory Schedule for Revised Hexavalent
Chromium Standard
Regulatory Action Date
Proposed Rule (69 Fed. Reg. 59306) October 4, 2004
Notice Comment Period Deadline January 3, 2005
OSHA Administrative Hearings February 1 15, 2005
Post-Hearing Submission of New Data March 21, 2005
Post-Hearing Comments April 20, 2005
Final Rule Deadline January 18, 2006
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Industry ImpactsSelected Industry Sectors

• Electroplating Welding
• Aerospace Shipbuilding
• Chromate Production Pigments Catalysts
• Portland Cement Chemical Distributors
• Refractory Brick Stainless Steel
• Industrial Laundries Steel Production
• Fiberglass Mfg. Defense Supply Chain
• Electric Utilities Construction

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Industry ImpactsKey Metal Finishing Operations

• Hard Chrome Plating
• Decorative Chrome Plating
• Chromic Acid Anodizing
• Chromate Conversion Coatings (e.g., Zn, Cd Al)
• Plating on Plastics
• Passivation
• Welding and Fabricating
• Polishing and Grinding
• Chemical Mixing Blending

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Occupational Exposure LimitsComparison of
Selected Countries (2002)
Country Occupational Exposure Limit
United States OSHA Proposed OSHA Current 1.0 ug/m3 52 ug/m3
Japan 50 ug/m3
European Union 50 ug/m3
France, Germany, UK, Finland 50 ug/m3
China 50 ug/m3
India 50 ug/m3
Sweden 20 ug/m3
Denmark 5 ug/m3
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Health Studies Industry Concerns

• Chromate Production Facilities 1930s thru 1970s
• Very high exposures, often of short duration
• OSHA Uses Linear Model to Extrapolate Past Risks
  at Very High Levels to Much Lower Current
  Exposures
• Expert review of Cr studies show different
  results
• Crump Study 23ug/m3 is protective
• SBREFA process recommended 23 ug/m3 - Spring 2004
• Uncertainty in OSHAs Risk Assessment

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OSHAs Estimate of the Number of Workers Exposed
in Industry Sectors and Health Risk Studies for
Each Industry Sector
242,119
250,000
200,000
of Workers Exposed to CrVI (per OSHA)
150,000
111,439
100,000
25,479
50,000
1,297
52
150
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Chromate Pigment Production
Ferrochromium (Chromium Metal ) Producers
Chromate Production
Aerospace
Other Industries
Chrome (VI) Plating
Welding
Langard Vigander 1983 Langard Vigander
1975 Davies 1984 Davies 1979 Hayes et al.
1989 Sheffet et al. 1982 Equitable Env. Health
1983,1976 Deschamps et al. 1995 Haguenoer et al.
1981 Langard Norseth 1975 Frentzel-Bayme
1983 Kano et al. 1993
Royle 1975 Sorahan et al. 1998 Sorahan et al.
1987 Silverstein et al. 1981 Franchini et al.
1983 Okubo Tsuchiya 1977 Takahashi Okubo
1990 Sorahan Harrington 2000
Gerin et al. 1993 Moulin 1997 Sjogren et al.
1994 Simonato et al. 1991 Moulin et al.
1993 Hansen et al. 1996 Lauitsen et al.
1996 Sjogren et al. 1987 Kjuus et al.
1986 Hull et al. 1989 Polednak et al.
1981 Becker 1995
Alexander et al. 1996 Boice et al.
1999 Dalager et al. 1980
Morgan et al. 1981 Pippard et al. 1985 Blot et
al. 2000 Rafnsson Johannesdottier
1986 Svensson et al. 1989 Cornell Landis
1984 Brinton et al.
Axelsson et al. 1980 Langard et al.
1990 Moulin et al. 1990 Pokrovskaya Shabynina
Gibb et al. 2000 Luipold et al. 2003 Mancuso
et al. 1997 Hayes et al. 1979 Braver et al.
1985 Mancuso et al. 1975 Mancuso Heuper
1951 Borne Yee 1950 Davies et al.
1991 Alderson et al. 1981 Bistrup Case
1956 Korallus et al. 1993 Korallus et al.
1982 Machle Gregorius 1948 Baetjer 1950
Key In Health Benefits Analysis In
Preliminary Quantitative Risk Analysis No
statistically significant relationship between
chrome exposure and lung cancer
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Technical Feasibility

• OSHA recommendations not appropriate
• Systems cannot be tweaked
• Fume suppressants not the answer
• Engineering controls identified by OSHA not
  sufficient
• Engineering Controls
• OSHAs data do not demonstrate technical
  feasibility
• Difficult to achieve PEL lower than 10 ug/m3
• Consistent compliance with action level needed
• Process and sampling variability concerns
• Substitutes and customer specifications limit
  process options

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Compliance Cost of Proposed PELMetal Finishing
Industry (/year, in millions)
Selected Requirements OSHA Cost Industry Cost
Engineering Controls 38,179 204,218
Exposure Monitoring 3,766 66,486
Personal Protective Equipment 12,163 65,861
Hygiene Areas and Practices 1,689 14,710
Housekeeping 9,189 9,392
Respirator Protection 2,190 14,938
Training Information .500 2,579
Total Annualized Cost 68 million 380 million
TOTAL COST (inc. 100 more affected facilities vs. OSHA est.) 760 million
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Annual Compliance Costs
Facility Engineering Controls Plus Respirators
Model Facility 226,777
Facility A 114,963 405,070
Facility B 75, 879 212,469
Facility C 404,467 592,621
Facility D 85,965 177,525
Facility E 89,348 165,133
Facility F 96,833 188,338
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Economic Impact Analysis

• OSHA No Significant Impacts
• Based on Low Estimated Compliance Costs
• Average Costs Compared to Average Ability to Pay
• Did not Differentiate Large from Small Facilities
• Industry Proposed PEL Would Close More than
  Half the Industry
• Critique OSHAs Crude Economic Impact Analysis
• Use EPAs MPM Economic Impact Analysis
• 50 Closure at 61,000/Facility/Year
• Detailed Affordability Case Studies for 6
  Facilities

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Summary Results from Electroplating Affordability
Case Studies
in thousands/yr in thousands/yr Lower Cost Lower Cost Higher Cost Higher Cost
Facility Lower Cost Higher Cost Profits Revenues Profits Revenues Conclusions
A Dec 115.0 405.1 30-50 1-2 gt 100 4-6 Will close for high costs, not low
B Hard 75.9 212.5 gt 100 4-6 gt 100 10-15 Will close
C Zinc 404.5 592.6 gt 100 4-6 gt 100 6-10 Will close
D Dec 86.0 177.5 gt 100 6-10 gt 100 15-20 Will close
E Ano 89.3 165.1 gt 100 3-4 gt 100 6-10 Will close Cr(VI) lines
F Hard 96.8 188.3 gt 100 2-3 gt 100 4-6 Will close for high costs, maybe for low
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Criteria for a Good Analysis of Economic
Feasibility for an Industry
Criteria OSHA EPA Us
Accurate compliance cost estimates OK EXC
Accurate data on ability to pay EXC EXC
Site-by-site affordability analysis EXC EXC
Good closure test(s) OK EXC OK
Consider market price response OK OK
Representative sites EXC OK
Scale up to entire industry OK EXC OK
Analyze small entities well EXC OK
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Benefit-Cost AssessmentIndustry Review

• OSHA Asserts Total Benefits from the PEL Exceed
  Costs by 140 million annually (includes health
  benefits across all affected sectors)
• Industry Analysis Launched to
• Formulate new cost estimates vs. OSHA cost
  estimates
• Review how OSHA arrived at benefits estimates
• Evaluate analytical methods and additional health
  studies and recalculate benefits
• Goal Credibly Compare Costs and Benefits for
  Alternative PELs
• Position Net benefits should be positive for
  any final PEL
• Conclusion Even without changing OSHA
  compliance cost estimates, benefits are much less
  than costs
• Conclusion OSHA drastically underestimated
  costs

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Re-Calculated Benefits

• Instead of using cancer slope range estimated
  from only 2 studies, use average of all 6 studies
  cited by OSHA
• Use best estimate for cancer latency, not OSHAs
  range
• Apply more accurate Value of Statistical Life
  estimate
• For purposes of this calculation, accept most of
  OSHAs other estimates

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Costs Benefits Summary ComparisonProposed
PEL and Alternatives ( millions, 2003)
PEL (ug/m3) 0.5 1.0 5 10 20
OSHAs COST 402 223 125 95 84
OSHAs Benefit Range 26 - 745 25 - 701 18 - 490 14 - 342 8 - 175
OSHAs Midpoint Benefit Estimate 386 363 254 178 92
OSHAs NET BENEFITS -17 140 128 82 7
Corrected Benefit Estimate 75 71 50 35 19
Corrected NET BENEFITS -327 -152 -75 -60 -65
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Strategic Approach

• Industry Coalition
• Dept. of Labor/OSHA
• Interagency
• Dept of Defense
• EPA
• Dept of Commerce
• Small Business Administration
• White House/OMB
• Congress