standard unlike state and local government employees at facilities in
states with OSHA approved State Plans. These processes pose the same
risk as the publicly owned water/wastewater treatment processes that
are in Program 3. EPA decided that there was little justification for
limiting the proposed requirements to the changed universe of Program 3
processes after the OSHA retail exemption change; there are fewer than
six RMP reportable accidents a year at remaining Program 2 processes.
Although the alternative would be slightly less burdensome on the
regulated community, it would also likely prevent fewer accidents than
the proposed approach. EPA seeks comment on the alternative approach
and whether there are any other alternative options that EPA should
consider prior to issuing a final action.

B. Third-Party Compliance Audits

    In addition to strengthening the incident investigation
requirements, EPA is proposing to strengthen the RMP rule's compliance
audit provisions to require independent third-party compliance audits
after an accident or findings of significant non-compliance by an
implementing agency for stationary sources with Program 2 and/or
Program 3 processes. Incident investigations often reveal that these
facilities have deficiencies in some prevention program requirements
related to that process. Compliance audits entail a systematic
evaluation of the full prevention program for all covered processes. As
described below, in some cases, self-auditing may be insufficient to
prevent accidents, determine compliance with the RMP rule's prevention
program requirements, and ensure safe operation. Stationary sources
that have had accidents and/or substantial non-compliance with Risk
Management Program requirements pose a greater risk to the surrounding
communities. EPA therefore believes it is appropriate to require such
stationary sources to undergo objective auditing by competent and
independent third-party auditors. Such independent third-party auditing
can assist the owners and operators, EPA (or the implementing agency),
and the public to better determine whether the procedures and practices
developed by the owner and/or operator under subparts C and/or D of the
RMP rule (i.e., the prevention program requirements) are adequate and
being followed.
    EPA and the CSB have cited poor compliance audits as a contributing
factor to the severity of past chemical accidents. The CSB identified a
lack of rigorous compliance audits as a contributing factor behind the
March 23, 2005 explosion and fire at the BP Texas City Refinery in
Texas City, Texas.\70\ This explosion and fire killed 15 people,
injured another 180, led to a shelter-in-place order that required
43,000 people to remain indoors, and damaged houses as far away as
three-quarters of a mile from the refinery.
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    \70\ CSB. March 2007. Investigation Report: Refinery Explosion
and Fire, BP, Texas City, Texas, March 23, 2005. Report No. 2005-04-
I-TX. http://www.csb.gov/assets/1/19/CSBFinalReportBP.pdf.
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    A CSB investigation of the July 2009 fire and explosion at the
Citgo Corpus Christi Refinery found that Citgo had never conducted a
safety audit of hydrofluoric acid (HF) alkylation operations at either
of its U.S. refineries equipped with HF alkylation units pursuant to
recommendations in API Recommended Practice 751, Safe Operation of HF
Alkylation Units.\71\ The CSB recommended that within 60 days, Citgo
complete a third-party audit of all Citgo HF alkylation unit operations
in the United States (Corpus Christi, Texas and Lemont, Illinois) in
accordance with API Recommended Practice 751. The CSB also specified
qualifications for the selected lead auditor including extensive
knowledge of HF hazards, HF alkylation units, and API 751.
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    \71\ CSB. December 9, 2009. Urgent Recommendations to Citgo.
http://www.csb.gov/csb-issues-urgent-recommendations-to-citgo-finds-inadequate-hydrogen-fluoride-water-mitigation-system-during-corpus-christi-refinery-fire-last-july/.
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    The CSB found that facility PSM audits failed to detect PSI and
operating procedure deficiencies that contributed to the November 2003
chlorine release at DPC Enterprises, L.P. in Glendale,

Arizona.\72\ The CSB recommended that DPC use a qualified, independent
auditor to evaluate DPC's PSM and Risk Management Programs against best
practices and implement audit recommendations in a timely manner at all
DPC chlorine repackaging sites.
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    \72\ CSB. February 2007. Investigation Report: Chlorine Release,
DPC Enterprises, L.P., Glendale, Arizona, November 17, 2003. Report
No. 2004-02-I-AZ. http://www.csb.gov/assets/1/19/DPC_Report.pdf.
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    The CSB also found numerous auditing deficiencies following the
January 2008 explosion at Bayer CropScience, LP, in Institute, West
Virginia.\73\ The CSB recommended that Bayer commission an independent
human factors and ergonomics study of all Institute site PSM and Risk
Management Program covered process control rooms to evaluate the human-
control system interface, operator fatigue, and control system
familiarity and training.
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    \73\ CSB. January 2011. Investigation Report: Pesticide Chemical
Runaway Reaction Pressure Vessel Explosion, Bayer CropScience LP,
Institute, West Virginia, August 28, 2008. Report No. 2008-08-I-WV.
http://www.csb.gov/assets/1/19/Bayer_Report_Final.pdf.
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    EPA has required third-party audits in enforcement settlement
agreements. For example, EPA found multiple occasions of noncompliance
with the Risk Management Program requirements at Tyson Foods, Inc.
facilities through a series of inspections and information requests.
Dating back to October 2006, violations included failures to follow the
general industry standards to test or replace safety relief valves,
improperly co-located gas-fired boilers and ammonia machinery, as well
as failures to abide by the RMP rule's prevention program and reporting
requirements. As part of a 2014 consent decree, Tyson Foods, Inc.
agreed, in addition to paying a penalty of $3.95 million, to conduct
pipe-testing and third-party audits of its ammonia refrigeration
systems to improve compliance with Risk Management Program requirements
at all 23 of the company's facilities in four Midwestern states.\74\
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    \74\ Consent Decree, United States v. Tyson Foods, Inc., et al.,
E.D. Miss., April 4, 2013. http://www2.epa.gov/enforcement/tyson-foods-inc.
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    In March 2015, EPA Region 1 issued an administrative order on
consent to Mann Distribution LLC and 3134 Post Road LLC (Respondents)
regarding Resource Conservation and Recovery Act (RCRA) and CAA
112(r)(1) (the ``general duty clause'') violations found during an
April 4, 2013 inspection at a chemical distribution facility in
Warwick, Rhode Island.\75\ Like the Risk Management Program
requirements, section 112(r)(1) of the CAA addresses safe operation and
prevention of accidental releases. Unsafe conditions found during the
inspection included, among other things, failure to have a fire
suppression system, failure to inspect a fire alarm, co-location of
incompatible chemicals, and many RCRA generator violations. The
facility also had a prior history of non-compliance. The order requires
Respondents to implement an independent third-party inspection program,
in addition to imposing other compliance requirements.
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    \75\ Finding of Violation and Administrative Order on Consent,
In the Matter of Mann Distribution LLC and 3134 Post LLC, Docket
Nos. RCRA-01-2015-0028 and CAA-01-2015-0029, March 17, 2015.
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    The proposed independent third-party compliance audit requirements
include a definition of ``third-party audit'' in Sec.  68.3;
modifications to existing Sec. Sec.  68.58 and 68.79 to specify when a
third-party audit must be performed; and the requirements for third-
party auditors and third-party audits in new Sec. Sec.  68.59 and
68.80. EPA is proposing to require third-party compliance audits to be
conducted at stationary sources following an accident meeting the five-
year accident history criteria in Sec.  68.42(a). EPA is also proposing
a provision to allow an implementing agency to require a third-party
audit be performed at a facility under certain circumstances that
suggest a heightened risk for an accident. These circumstances are:
Non-compliance with the Prevention Program requirements of subpart C
(Program 2) or subpart D (Program 3), including non-compliance with the
competency, independence, or impartiality criteria of Sec.  68.59(b) or
Sec.  68.80(b) regarding a previous third-party audit. All other
stationary sources with Program 2 and Program 3 processes will continue
to follow the current compliance audit requirements of Sec. Sec.  68.58
and 68.79.
    Sections 68.58 and 68.79 of the RMP regulation (Program 2 and
Program 3 Compliance Audits) require owners or operators of stationary
sources with processes subject to Program 2 or Program 3 requirements
to audit compliance with the provisions of subpart C (Program 2
Prevention Program requirements) or subpart D (Program 3 Prevention
Program requirements) at least every three years. The purpose of the
compliance audits is to verify that the procedures and practices
developed under subparts C and D of the RMP rule are adequate and being
followed. These compliance audit provisions are similar to language to
that is found in 29 CFR 1910.119(o) of the OSHA PSM standard. Sections
68.58 and 68.79 of the RMP regulation and 1910.119(o) of the OSHA PSM
standard require that the compliance audit be conducted by at least one
person knowledgeable in the process, that audit findings be addressed
promptly, and that a report be generated documenting the findings of
the audit.
    Currently, neither EPA nor OSHA requires employers to use
independent third-parties in conducting compliance audits. However,
third-party compliance auditors exist, both the RMP rule and the PSM
standard permit their use, and they are utilized by some of the Risk
Management Program and PSM regulated community, both voluntarily, and
pursuant to enforcement settlement agreements.
    EPA discussed the potential to use independent third-party auditors
for Risk Management Program compliance audits, in the preamble of the
1996 final RMP rule, as an issue for further consideration.\76\ The
preamble endorsed the concept of using third parties, citing the
following reasons: To assist in rule compliance and oversight, provided
that any third-party proposal not weaken the compliance
responsibilities of facility owners or operators; offer cost savings
and benefits to the industry, community, and implementing agencies that
significantly exceed the cost of implementing the approach; lead to a
net increase in process safety, particularly for smaller, less
technically sophisticated facilities; and promote cost-effective Agency
prioritization of oversight resources. At the time, EPA did not require
the use of third-party auditors because the Agency believed that
several key issues, including qualification criteria, certification
procedures, liability, and others, needed to be investigated. Based on
EPA's research of other third-party audit programs as well as the
Agency's own experience with third-party auditors in the context of
enforcement settlements, the Agency is proposing third-party audit
requirements for the rule's accident prevention program.
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    \76\ Accidental Release Prevention Requirements: Risk Management
Programs Under CAA Section 112(r)(7), 61 FR 31705, June 20, 1996.
http://www.gpo.gov/fdsys/pkg/FR-1996-06-20/pdf/96-14597.pdf.
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    Third-party audits are required by other Federal programs in
appropriate existing rules, and rules currently in development, to
ensure safe operations. The Administrative Conference of the United
States (ACUS) ``Third-Party Programs Final Report'' (October 22, 2012)
describes a variety of third-party programs in Food and Drug
Administration (FDA), Consumer Product Safety Commission, and Federal
Communications Commission

regulations.\77\ Further examples follow. The Bureau of Safety and
Environmental Enforcement (BSEE) promulgated revisions to their Safety
and Environmental Management Systems (SEMS II) requirements (78 FR
20423, April 5, 2013) to help ensure the safe operations of offshore
oil and natural gas drilling and production facilities. BSEE's SEMS
standard, 30 CFR part 250, subpart S, requires audits conducted by an
independent third-party, subject to approval by BSEE, or by designated
and qualified personnel if the employer implements procedures to avoid
conflicts of interest. BSEE's SEMS II revisions to the standard require
that, by June 4, 2015, the team lead for compliance audits must be
independent and represent an accredited audit service provider. In the
preamble to its SEMS II final rule, BSEE discussed its third-party-
auditing requirements as follows:
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    \77\ McCallister, Lesley. October 22, 2012. Third-Party Programs
Final Report (2012). http://www.acus.gov/report/third-party-programs-final-report.

    Consistent audits performed by well trained and experienced
auditors are critical to ensuring that SEMS programs are
successfully implemented and maintained on the [Outer Continental
Shelf] OCS. As a result, we are adopting industry best practices
related to SEMS audits and auditor qualifications. Industry is
already voluntarily adopting these practices in many deepwater
operations. We believe that the application of these requirements to
all OCS operations will result in more robust and consistent SEMS
---------------------------------------------------------------------------
audits. (78 FR 20430, April 5, 2013.)

    Independent third-party audits or other forms of compliance
verification are also required by a variety of EPA rules to promote
compliance with regulatory standards. One example of an EPA regulatory
program with built-in third-party verification is the EPA CAA wood
stoves rule.\78\ Additionally, EPA is developing a rule for a third-
party certification framework for the formaldehyde standards for
composite wood products in accordance with the Formaldehyde Standards
for Composite Wood Products Act in which Congress mandated that EPA
promulgate rules that include a third-party testing and certification
program.\79\
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    \78\ Standards of Performance for New Residential Wood Heaters,
New Residential Hydronic Heaters and Forced-Air Furnaces, 80 FR
13671, March 16, 2015. http://www.gpo.gov/fdsys/pkg/FR-2015-03-16/pdf/2015-03733.pdf.
    \79\ Formaldehyde; Third-Party Certification Framework for the
Formaldehyde Standards for Composite Wood Products, 78 FR 34796,
June 10, 2013. http://www.gpo.gov/fdsys/pkg/FR-2013-06-10/pdf/2013-13254.pdf. See also the Formaldehyde Standards for Composite Wood
Products Act https://www.gpo.gov/fdsys/pkg/BILLS-111s1660enr/pdf/BILLS-111s1660enr.pdf.
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    Third-party verification and certification approaches are also
employed in a variety of state regulatory settings. Examples include
the CAA Title II vehicle inspection, maintenance, and emissions
programs in authorized states,\80\ California's mandatory greenhouse
gas (GHG) reporting program,\81\ and Massachusetts Underground Storage
Tank (UST) third-party inspection program.\82\
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    \80\ See, e.g., Missouri Dept. of Nat. Resources and Missouri
State Highway Patrol, First Annual Oversight Report of the
Decentralized Gateway Vehicle Inspection Program (2008). http://www.dnr.mo.gov/gatewayvip/docs/enforcementrpt.pdf.
    \81\ Cal. Code of Regs. Accreditation Requirements for
Verification Bodies, Lead Verifiers, and Verifiers of Emissions Data
Reports and Offset Project Data Reports. tit. 17 Sec.  95132(b)(4)
(2010); see also Cal. Code of Regs. tit. 17 Sec.  95132(b)(1)
(describing the firm requirement of having a lead verifier); Cal.
Code of Regs. tit. 17 Sec.  95132(b)(2) (2010) (describing the lead
verifier requirements) and Cal. Code of Regs. tit. 17 Sec.
95132(b)(1). https://govt.westlaw.com/calregs/Document/I047B3A909A3011E4A28EDDF568E2F8A2?viewType=FullText&originationContext=documenttoc&transitionType=CategoryPageItem&contextData=%28sc.Default%29.
    \82\ MassDEP. 2015. UST Inspection Program. http://www.mass.gov/eea/agencies/massdep/toxics/ust/third-party-ust-inspection-program.html.
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    There are advantages to third-party auditing, particularly with
strong auditor competence and independence criteria. According to the
CCPS, ``Third-party auditors (typically, consulting companies who can
provide experienced auditors) potentially provide the highest degree of
objectivity.'' \83\ ACUS, in its ``Recommendation on Agency Use of
Third-Party Programs to Assess Regulatory Compliance'' (December 6,
2012) (Recommendation), found that, when well-designed and implemented
per the Recommendation, ``[s]everal broad reasons support the growing
use of third-party programs in Federal regulation.'' Specifically, ACUS
found that
---------------------------------------------------------------------------

    \83\ CCPS. March 2007. Guidelines for Risk Based Process Safety.
http://www.aiche.org/ccps/resources/publications/books/guidelines-risk-based-process-safety.

. . . Federal regulatory agencies are faced with assuring the
compliance of an increasing number of entities and products without
a corresponding growth in agency resources. Third-party programs may
leverage private resources and expertise in ways that make
regulation more effective and less costly. In comparison with other
regulatory approaches, third-party programs may also enable more
frequent compliance assessment and more complete and reliable
---------------------------------------------------------------------------
compliance data.

A leading scholar on regulatory third-party programs likewise found
that, when well-designed and implemented, ``third-party verification
could furnish more and better data about regulatory compliance'' while
providing additional compliance and resource savings benefits.\84\
---------------------------------------------------------------------------

    \84\ Lesley K. McAllister. Jan. 2012. Regulation by Third-Party
Verification. 53 B.C. L. Rev. 1, 21-26. http://lawdigitalcommons.bc.edu/bclr/vol53/iss1/1/ iss1/1/.
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    An ``independent third-party'' is a private auditor, inspector, or
other type of verifier external to the facility. ``Independent third-
party'' excludes the regulated entity, which is the first party (e.g.,
the stationary source and its parent company and subsidiaries), second
parties within the firm's industry or business community with whom the
regulated entity has a supply-chain relationship, and third parties
that are not independent of the first party, which may include
contractors, consultants, or purchasers of the facility's goods or
services.\85\ An independent third-party program should not be confused
with a second party program in which a regulated source employs a
contractor or consultant, even when the contractor is a separate legal
entity from the regulated facility and highly qualified. If a regulated
source provides direct or indirect control over the contractor or
consultant preparing the audit report, including controlling the
report's scope or findings, or has other non-audit relationships with
the auditor, then the auditor is not a true independent third-party.
This is important because when developing a third-party audit program,
auditor independence can be critical to the success of the program.
---------------------------------------------------------------------------

    \85\ Lesley K. McAllister. Jan. 2012. Regulation by Third-Party
Verification. 53 B.C. L. Rev. 1, 22-23 at p. 37.
---------------------------------------------------------------------------

    Third-party compliance audit programs should also establish
criteria and standards for auditor independence. As documented in the
ACUS Recommendation on Agency Use of Third-Party Programs to Assess
Regulatory Compliance (December 6, 2012),\86\ the ACUS Third-Party
Programs Final Report (October 22, 2012), and the McAllister law review
article, auditor independence is critical to ensuring accurate and
reliable independent third-party auditing.\87\
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    \86\ ACUS; Administrative Conference Recommendation 2012-7;
Agency Use of Third-Party Programs to Assess Regulatory Compliance
(Adopted December 6, 2012) at 3-4. https://www.acus.gov/recommendation/agency-use-third-party-programs-assess-regulatory-compliance.
    \87\ See, e.g., Lesley K. McAllister. Jan. 2012. Regulation by
Third-Party Verification. 53 B.C. L. Rev. 1, pp. 3, 39-40.
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    The literature on designing independent third-party programs
includes peer-reviewed empirical studies emphasizing the importance of

establishing criteria and features for auditor independence to promote
accurate audit reports, including those summarized briefly below. While
it is not necessary that all audits be conducted only by independent
third parties, when independent third-party auditing is necessary and
appropriate, the literature indicates that, without sufficient
safeguards to ensure auditor independence, auditors are more likely to
provide lenient or biased audit reports that can fail to accurately
identify problems and violations by the regulated entity.
    One such study is a randomized control design field experiment in
the State of Gujarat in India.\88\ This study revealed weaknesses in
the existing third-party regulatory audit system and the potential for
a series of market-based alterations to dramatically improve auditor
accuracy. In India, Gujarat Pollution Control Board regulates more than
20,000 industrial plants. From the universe of audit-eligible plants
located in two populous and heavily polluted industrial regions, the
researchers identified a study sample of 473 randomly-selected plants,
stratified by region. Half of the plants were randomly assigned into a
control group. The other half of the plants, also randomly assigned,
were informed by the State of changes to their audit regulation that
included the following: Plants would be randomly assigned auditors they
were required to use (i.e., they could no longer choose their own
auditors); auditors would be paid from a central pool rather than by
the plant for which they worked; auditor fees were set in advance at a
flat rate (high enough to cover pollution measurement and give the
auditor a modest profit); a random sample of each auditor's pollution
readings would be verified with follow-up visits to the audited plants
by an independent technical agency; in year two of the experiment, the
third-party auditors were informed that their pay would be linked to
their reporting accuracy as measured by the technical agency's follow-
up visits. The researchers found that, under the status quo system, the
third-party auditors systematically reported false pollution levels
just below the applicable regulatory standard (also known as strategic
misreporting) but the experimental changes significantly improved the
truthfulness of the third-party auditors' reports, even for auditors
operating in both markets who audited firms in both the control and
treatment groups. Also, and importantly, once the plants understood
that their auditors would henceforth be reporting more accurately to
the State, they reduced their actual pollution emissions.
---------------------------------------------------------------------------

    \88\ Esther Duflo et al., Truth-Telling By Third-Party Auditors
And The Response of Polluting Firms: Experimental Evidence From
India, 128 Q. J. of Econ. 4 at 1499-1545 (2013).
---------------------------------------------------------------------------

    A pair of 2013 studies of independent third-party vehicle emission
testing in New York also considered factors impacting third-party
independence. This research was based on millions of emission test
results from thousands of test facilities.\89\ The authors' findings
include that there is a relationship between testing facilities'
opportunities to ``cross sell'' other products and services to car
owners and the test results. The researchers found that, in pursuit of
customer loyalty, facilities with more cross-selling opportunities were
incentivized to ``pass'' cars that facilities with fewer cross-selling
opportunities would not.\90\
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    \89\ Victor Manuel Bennett, et al. August 2013. Customer-Driven
Misconduct How Competition Corrupts Business Practices. Management
Science Vol. 59, No. 8, pp. 1725-1742. http://www.hbs.edu/faculty/Pages/item.aspx?num=43347 and Lamar Pierce and Michael W. Toffel.
Sept.-Oct. 2013. The Role of Organizational Scope and Governance in
Strengthening Private Monitoring. Organization Science Vol. 24, No.
5, pp. 1558-1584.
    \90\ Lamar Pierce and Michael W. Toffel. Sept.-Oct. 2013. The
Role of Organizational Scope and Governance in Strengthening Private
Monitoring. Organization Science Vol. 24, No. 5, at 1575. http://www.hbs.edu/faculty/Publication%20Files/11-004.pdf.
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    Further evidence suggests that many, if not most, of some types of
financial audits are flawed due to insufficient auditor competence,
independence, and/or lack of public transparency. Third-party auditing
is a linchpin of financial reporting. But when the Public Company
Accounting Oversight Board (PCAOB) released its third annual report on
audits of broker-dealers registered with the Securities and Exchange
Commission (SEC), the PCAOB found audit deficiencies in portions of 70
of the 90 audits. Independence problems were found in 21 on the 90
audits where, contrary to SEC rules, firms helped with the bookkeeping
or preparation of the financial statements they audited.\91\
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    \91\ PCAOB. Aug. 18, 2014. Third Progress Report on PCAOB
Inspections of Broker and Dealer Auditors Shows Continued High
Number of Findings. http://pcaobus.org/Inspections/Documents/BD_Interim_Inspection_Program_2014.pdf.
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    In 2014, the New York State Department of Financial Services
(NYDFS) fined PricewaterhouseCoopers (``PwC'') Regulatory Advisory
Services $25 million, suspended it for 24 months from accepting
consulting engagements at regulated financial institutions, and
required it to implement a series of reforms after PwC improperly
altered a report submitted to regulators on sanctions and anti-money
laundering compliance at Bank of Tokyo Mitsubishi (BTMU). Under
pressure from BTMU executives who received an advance draft of its
report to review, PwC edited the report, and in the final version of
the report which was sent to regulators, a number of key provisions
were deleted or otherwise significantly edited.\92\
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    \92\ Press Release: NYDFS Announces PwC Regulatory Advisory
Services Will Face 24-Month Consulting Suspension; Pay $25 Million;
Implement Reforms After Misconduct During Work At BTMU. Aug. 18,
2014. http://www.dfs.ny.gov/about/press/pr1408181.htm.
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    These recommendations, studies, and reports emphasize the
importance of designing independent third-party programs to embody
auditor independence by building in appropriate criteria and processes
for third-party independence. They identify a range of available design
elements to promote such independence. EPA consulted this literature in
developing today's proposed independent third-party compliance auditing
program.
    Industry recognizes the benefits of third-party auditing programs
and have established programs and standards for third-party audits for
some types of operations, many of which are also subject to the RMP
rule.\93\ These programs also demonstrate industry's understanding
that, in appropriate circumstances, third-party auditing can provide
benefits and results above those available through self-auditing alone.
In addition, these programs and standards illustrate the range and
variety of structural design elements that can be, and are, employed in
third-party programs to address auditor competence and independence,
auditor certification, the audit process, auditor reporting,
recordkeeping, and the public disclosure of audit results and
associated information.
---------------------------------------------------------------------------

    \93\ EPA has not formally evaluated these programs and standards
or their outcomes. This discussion is not a formal Agency review or
endorsement of them.
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    Some industry groups, such as SOCMA and the Center for Offshore
Safety (COS), require certain types of third-party audits for their
members. SOCMA members are U.S. companies engaging in the manufacturing
or handling of synthetic and organic chemicals. Active members have a
mandatory requirement to participate in ChemStewards[supreg], a program
intended to promote continuous performance improvement in batch
chemical manufacturing. The program offers a three-tiered approach to
participation. Each tier includes a third-party verified

management system.\94\ The COS strategy for promoting safety and
protection of the environment includes third-party auditing and
certification of the COS member company's SEMS and accreditation of the
organizations (Audit Service Providers) providing the audit services.
The third-party audits are intended to ensure that COS member companies
are implementing and maintaining SEMS throughout their deepwater
operations.\95\
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    \94\ SOCMA. 2015. See http://www.socma.com/ChemStewards/.
    \95\ COS. 2013. See http://www.centerforoffshoresafety.org/auditInfo.html.
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    ACC members are required to participate in a Responsible Care
management system described by ACC as including, identifying, and
acting to address potential hazards and risks associated with their
products, processes, distribution and other operations. One of
Responsible Care's program elements is a product safety code consisting
of eleven management practices through which chemical manufacturers are
encouraged to evaluate, demonstrate and continuously improve their
product safety performance while making information about chemical
products available to the public.\96\ Responsible Care also has a
process safety code consisting of seven management practices through
which chemical manufacturers commit to safe operation of their chemical
processes. According to ACC,
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    \96\ ACC. 2013. Responsible Care Product Safety Code. http://responsiblecare.americanchemistry.com/Responsible-Care-Program-Elements/Product-Safety-Code.

the Responsible Care Process Safety Code differs from regulatory
standards that, by necessity, focus on process safety at an
individual facility. ACC contends that the Process Safety Code is
more universal--it addresses issues across a division or
corporation, and includes a company commitment to set process safety
expectations, define accountability for process safety performance
and allocate adequate resources to achieve performance
expectations.\97\
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    \97\ ACC. 2013. Responsible Care Process Safety Code. http://responsiblecare.americanchemistry.com/Responsible-Care-Program-Elements/Process-Safety-Code.

The Responsible Care management system process includes mandatory
certification, by auditors described by ACC as accredited and
independent, to ensure the program participants have a structure and
system in place to measure, manage and verify performance.\98\
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    \98\ Certification must be renewed every three years, and
companies can choose one of two certification options. RCMS[supreg]
certification in intended to verify that a company has implemented
the Responsible Care Management System. RC14001[supreg]
certification combines Responsible Care and ISO 14001 certification.
See http://responsiblecare.americanchemistry.com/Responsible-Care-Program-Elements/Management-System-and-Certification and http://responsiblecare.americanchemistry.com/Responsible-Care-Program-Elements/Process-Safety-Code/Responsible-Care-Process-Safety-Code-PDF.pdf.
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    The API, in collaboration with industry partners, has developed a
Process Safety Site Assessment Program (PSSAP). According to API, the
program is intended to provide for the assessment of API member sites'
process safety systems by third-party teams of independent, industry-
qualified process safety expert assessors. Using industry-developed
protocols, API describes the process safety site assessments as
evaluating the quality of written programs and effectiveness of field
implementation for the following process safety areas that will be
evaluated: Process Safety Leadership; MOC; Mechanical Integrity
(focused on fixed equipment); Safe Work Practices; Operating Practices;
Facility Siting; Process Safety Hazards; and HF Alkylation/RP 751. The
assessment teams produce reports that identify observations that site
personnel should consider further but do not provide written
recommendations.\99\
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    \99\ API. 2015. PSSAP. http://www.api.org/certification-programs/process-safety-site-assessment-programs.
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1. Applicability of Third-Party Audit Requirements
    Currently, there are approximately 12,000 stationary sources with
Program 2 and/or Program 3 processes. The proposed rule would not
require all of these RMP facilities to use third-party auditors when
conducting compliance audits under subpart C or D. Instead, EPA is
proposing that owners or operators be required to perform third-party
compliance audits at their facilities only under the following two
conditions.
    Under the first condition, a third-party compliance audit would be
required in lieu of an internal compliance audit if there has been an
accidental release from an RMP facility meeting the five-year accident
history criteria as described in Sec.  68.42(a). The existing five-year
accident history criteria include accidental releases from covered
processes that resulted in deaths, injuries, or significant property
damage on-site; or deaths, injuries, property damage, evacuations,
sheltering in place, or environmental damage offsite. EPA and other
implementing agencies would learn about accidents meeting the five-year
accident history criteria because such accidents must be included
within a facility's RMP within six months of the accident, in
accordance with Sec.  68.195(a). Following such an accident, the RMP
facility's owner or operator would be required to engage a third-party
auditor to conduct a compliance audit for the source. Pursuant to
Sec. Sec.  68.58(h) and 68.79(h), the third-party audit and associated
report shall be completed, and submitted to the implementing agency
pursuant to Sec.  68.59(c)(3) or Sec.  68.80(c)(3) as follows, unless a
different timeframe is specified by the implementing agency: within 12
months of when the third-party audit is required pursuant to Sec.
68.58(f) and/or (g) or Sec.  68.79(f) and/or (g); or within three years
of completion of the previous compliance audit, whichever is sooner.
    The second condition is if an implementing agency has made a
determination that a third-party audit at an RMP facility is necessary,
based on information about the facility or a prior third-party audit at
the facility. Information about an RMP facility that would lead to such
a determination could be obtained from sources including an inspection
of a facility by the implementing agency's representatives. Relevant
information to support the determination may include evidence of
significant non-compliance with the prevention program requirements of
subpart C or D of part 68. Significant non-compliance includes
deficiencies relating to a previous third-party audit (i.e., failure to
meet the competency, independence, or impartiality criteria of Sec.
68.59(b) or Sec.  68.80(b)).
    If such a determination is made, the implementing agency must
provide a written notice to the owner or operator of the facility
stating the reasons for the determination that a third-party audit must
be performed. The proposed rule provides for an opportunity for the
owner or operator to provide information and data to the implementing
agency and to consult with the implementing agency about the need to
perform a third-party audit at the facility source before the
implementing agency representatives make a final determination. EPA
seeks comment on these proposed third-party audit applicability
requirements.
2. Alternative Options for Third-Party Audit Applicability Criteria
    EPA considered requiring third-party compliance audits for a larger
universe of regulated facilities. We considered whether to require
third-party

compliance audits for all facilities with processes subject to Program
3 requirements at least every three years. We also considered whether
to require third-party compliance audits for all facilities with
processes subject to Program 2 or Program 3 requirements every three
years. However, because EPA views facilities that have had accidents or
significant non-compliance as presenting higher risks to surrounding
communities, the Agency is proposing to limit the applicability of this
provision to these facilities.
    EPA seeks comments and suggestions on the proposed third-party
audit applicability requirements and whether to eliminate or further
limit applicability of this provision. For example, EPA could consider
limiting the provision to only Program 3 facilities that have had
accidents or to only facilities that have had major accidents with
offsite impacts. EPA seeks comments on this alternative approach and to
define and characterize ``major accidents with offsite impacts.''
Alternatively, EPA could revise this provision to reduce its impact on
small businesses. When providing suggested alternatives, please include
suggestions for how to improve compliance with auditing provisions.
    EPA also seeks comment on whether there are other criteria that
could require RMP facilities to perform third-party compliance audits.
For example, a third-party audit could be required if an owner or
operator of a facility were to learn or know of a condition or
conditions at its facility suggesting a concern for, or potential risk
of, future accidents. Such conditions would need to be objective and
reasonably ascertainable by the facility owners or operators, the
implementing agency, and the public.
    EPA also seeks comment on the benefits and costs of proposing
additional requirements for third-party compliance audits and
recommendations for appropriate conditions suggesting a concern for, or
potential risk of, future accidents.
3. Proposed Third-Party Audit Requirements
a. Compliance Audit (Sec. Sec.  68.58 and 68.79)
    In order to prevent accidents and ensure compliance with part 68
requirements, EPA is proposing to require certain RMP facilities to
perform third-party audits. The proposed changes to Sec. Sec.  68.58
and 68.79 would add this requirement for both Program 2 and Program 3
processes, under certain conditions.
    EPA proposes new paragraphs Sec. Sec.  68.58(f) and 68.79(f) which
describe when a third-party audit is required. Pursuant to these
paragraphs, the next required compliance audit for an RMP facility
shall be a third-party audit when one of the following conditions
apply: (1) An accidental release, meeting the criteria in Sec.
68.42(a), from a covered process has occurred; or (2) an implementing
agency requires a third-party audit based on non-compliance with the
requirements of this subpart, including when a previous third-party
audit failed to meet the competency, independence, or impartiality
criteria of Sec.  68.59(b) or Sec.  68.80(b). The purpose is to help
reduce the risk of future accidents by requiring an objective auditing
process to determine whether the owner or operator of the facility is
effectively complying with the prevention program requirements of part
68.
    EPA proposes new paragraphs Sec. Sec.  68.58(g) and 68.79(g),
Implementing agency notification and appeals, which describe the
procedure for when a third-party audit is required by an implementing
agency. Pursuant to these paragraphs, if an implementing agency makes a
preliminary determination that a third-party audit is necessary, the
implementing agency will provide written notice to the facility owner
or operator stating the reasons for the implementing agency's
determination. The owner or operator has an opportunity to provide
information to, and to consult with, the implementing agency. The
implementing agency then provides a final determination to the owner or
operator. If the final determination requires a third-party audit, the
owner or operator shall comply with the requirements of Sec.  68.59
and/or Sec.  68.80, but also may choose to appeal the final
determination. After the appeal is considered, the implementing agency
will provide a written, final decision on the appeal to the owner or
operator.
    EPA proposes new paragraphs Sec. Sec.  68.58(h) and 68.79(h), which
describe the schedule for conducting third-party audits. The audit and
associated report shall be completed, and submitted to the implementing
agency as follows, unless a different timeframe is specified by the
implementing agency: (1) Within 12 months of when any third-party audit
is required; or (2) within three years of completion of the previous
compliance audit, whichever is sooner.
b. Third-Party Audits (Sec. Sec.  68.59 and 68.80)
    EPA is proposing new Sec. Sec.  68.59 and 68.80, which include the
requirements for both third-party audits, and third-party auditors.
    Sections 68.59(a) and 68.80(a) state that owners or operators shall
engage a third-party auditor to evaluate compliance with the provisions
of this subpart in accordance with the requirements of this section
when the criteria of Sec.  68.58(f) or Sec.  68.79(f) are met.
    EPA is proposing, in Sec. Sec.  68.59(b) and 68.80(b), that owners
and operators of RMP facilities subject to these requirements determine
and document the competency, independence, and impartiality of their
auditors. These sections require that the facility owners or operators
be responsible for self-determining and documenting that their third-
party auditors are competent and independent pursuant to the criteria
listed in Sec.  68.59(b)(1) through (3) or Sec.  68.80(b)(1) through
(3), by requiring specific provisions and safeguards in their contracts
and relationships with their third-party auditors.
    EPA seeks comment as to whether the requirement that owners and
operators of RMP facilities be responsible for determining and
documenting the competency, independence, and impartiality of their
auditors is appropriate.
Alternative Option for Third-Party Auditor Selection and Accreditation
    EPA also considered an alternative approach, such as requiring
auditors to have accreditation from a recognized auditing body or EPA.
Most independent third-party regulatory compliance verification
programs require the qualifying third-parties to apply for and receive
accreditation from a qualified external party to ensure competency and
independence. Such an external accreditation approach can add rigor to
the process of confirming the competence and independence of the
auditors but it also adds procedures and costs. Therefore, while EPA is
not proposing that the Agency itself will accredit third-party
auditors, EPA seeks comment on whether to require additional
accreditation criteria and how to best establish and structure an
accreditation program within the context of the RMP rule.
Auditor Competence
    Third-party compliance verification programs should establish
criteria and standards for auditor competence. Typically, such criteria
and standards combine specified minimum levels of education, knowledge,
experience, and training. EPA is proposing to require in proposed
Sec. Sec.  68.59(b)(1)(i) through (iv) and 68.80(b)(1) (i) through (iv)
that third-party auditors be:

     Knowledgeable with the requirements of part 68;
     experienced with the facility type and processes being
audited and the applicable recognized and generally accepted good
engineering practices (RAGAGEP);
     trained or certified in proper auditing techniques; and
     be a licensed Professional Engineer (PE), or include a
licensed PE on the audit team.

    EPA is proposing to require a PE as part of the audit team in an
attempt to identify competent auditors that also have an ethical
obligation to perform unbiased work. EPA seeks comment on whether these
criteria are appropriate and sufficient to ensure third-party auditors
are competent to perform high-quality compliance audits. EPA also seeks
comment on whether the proposal to require that a third-party auditor,
or a member of the audit team, be a licensed PE is appropriate and
whether there are enough licensed PEs to conduct third-party audits for
the universe of facilities that may become subject to these
requirements. Are there other qualifications who might be appropriate
for RMP auditors in lieu of a PE?
    As part of the SBAR Panel process, SERs suggested to the SBAR Panel
that EPA consider substituting other qualified personnel such as:
degreed chemists, degreed chemical engineers, Certified Safety
Professionals (CSP), Certified Industrial Hygienists (CIH), Certified
Fire Protection Specialists (CFPS), Certified Hazardous Materials
Managers (CHMM), Certified Professional Environmental Auditors (CPEA)
or Certified Process Safety Auditors (CPSA). SERs indicated that these
credentials also include ethical obligations to provide sound
independent advice. EPA also seeks comment regarding potentially
relevant and applicable consensus standards and protocols that might
apply to the audits and be built and/or incorporated by reference into
the rules. These may include relevant and applicable American National
Standards Institute, American Society for Testing and Materials
International, European Committee for Standardization, International
Organization for Standardization (ISO), and National Institute of
Standards and Technology (NIST) standards.
Auditor Independence and Impartiality
    Proposed Sec. Sec.  68.59(b)(2)(i) through (vi) and 68.80(b) (2)(i)
through (vi) set forth the independence and impartiality requirements
for third-party auditors and audit teams. These include that third-
party auditors:

     Act impartially when performing all third-party audit
activities;
     receive no financial benefit from the outcome of the
audit, apart from payment for the auditing services;
     not have conducted past research, development, design,
construction services, or consulting for the owner or operator
within the last 3 years; \100\
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    \100\ For purposes of this requirement, consulting does not
include performing or participating in third-party audits pursuant
to Sec.  68.59 or Sec.  68.80.
---------------------------------------------------------------------------

     not provide other business or consulting services to
the owner or operator, including advice or assistance to implement
the findings or recommendations in an audit report, for a period of
at least 3 years following submission of the final audit report;
     Ensure all personnel involved in the audit sign and
date a conflict of interest statement; and
     ensure all personnel involved in the audit do not
accept future employment with the owner or operator of the facility
for a period of at least 3 years following submission of the final
audit report. For purposes of this requirement, employment does not
include performing or participating in third-party audits pursuant
to Sec.  68.59 or Sec.  68.80.

    As part of the SBAR Panel process, SERs raised concerns about the
extent of the independence criteria and suggested this might limit the
availability of qualified auditors. Specifically, SERs asked how to
apply the independence criteria to a company that employs personnel who
previously worked for or otherwise engaged in consulting services with
the facility. Audit firms with personnel who, before working for the
firm, performed services for the owner or operator as an employee,
contractor or consultant, meet the rule's independence criteria when
such personnel do not participate on, manage, or advise the audit
teams. Additionally, employees of an auditing firm are not prohibited
from accepting future employment with the owner/operator as long as
they were not directly involved in performing or managing the audit.
    Another concern raised by SERs is ensuring that third-party
auditors do not pose a terrorism concern or release information that
could compromise facility security or CBI. EPA agrees that chemical
facility security is a priority and seeks comments on the impacts a
third-party auditor may have on a facility's security and whether there
is a need to specify security protections or whether existing non-
disclosure and contractual agreements should handle this independently.
    EPA seeks comment on whether the proposed auditor independence
criteria are appropriate and sufficient. If not, we seek comment on how
best to adjust the criteria for maximum auditing effectiveness and
efficiency, including comments or suggestions on how to provide more
flexibility in the auditor independence criteria, or whether to
eliminate the requirement for independence. EPA also seeks comments on
whether the proposed 3-year timeframe to separate the audit from other
business arrangements with the owner or operator is appropriate.
    Furthermore, EPA is requesting comment on whether the proposed
auditor independence criteria should be modified so as to not exclude a
retired employee from auditing a former employer's facility if the
employee's sole continuing financial attachment to the owner or
operator is an employer-financed or employer-managed retirement plan.
While EPA is concerned such attachments could provide the auditor with
incentives to ensure the facilities they audit are not financially
negatively impacted by their audits, it could also, as a practical
matter, limit the available pool of otherwise qualified and competent
auditors. EPA seeks comment on the potential magnitude of such
incentives and how to address this concern in the rule.
    Finally, EPA requests comment on whether to propose streamlined
independence criteria for small facilities (i.e., based on the size of
the facility) including comments or suggestions on how to streamline
the requirements.
Auditor Policies and Procedures
    Proposed Sec. Sec.  68.59(b)(3) and 68.80(b)(3), if finalized,
would require that owner or operators of RMP regulated facilities
ensure that third-party auditors have written policies and procedures
to ensure that all personnel comply with the competency, independence,
and impartiality requirements of these sections. EPA seeks comment on
these proposed provisions.
Alternative Options for Auditor Qualifications
    EPA considered including alternative options in the proposed rule
for owners and operators of stationary sources who cannot, despite best
efforts, find a third-party auditor meeting all of the independence
criteria. Two specific options were considered.
    Under the first option, owners and operators of RMP facilities, in
addition to self-selecting their third-party auditors pursuant to the
specified independence criteria, would also self-determine when it is
impossible or impractical to hire such auditors and self-select their
alternative auditors.

Under this option, the owner or operator would be required to inform
the implementing agency and the public of the alternative auditors,
which could be accomplished by providing and/or publicly posting
information on the alternative auditors and how they were selected. The
information could describe the steps taken to identify auditors meeting
all of the rule's independence criteria, the identities and
competencies of the alternative auditors, the regulatory independence
criteria that the alternative auditors were unable to meet and why, and
any steps taken to address or limit the impacts of the auditors' lack
of independence on the outcomes and reliability of their audits.
    Under the second option, owners and operators who, despite best
efforts, could not find auditors meeting all the rule's independence
criteria would be authorized to identify specific alternative auditors
to the implementing agency and petition it for approval to engage those
auditors. This approach would include a requirement for auditors not
fully satisfying the rule's independence criteria to prepare and
implement Conflict of Interest Mitigation Plans similar to those
required by the California Air Resources Board (CARB) under its
Regulation for the Mandatory Reporting of GHG Emissions,\101\ with
associated reporting, recordkeeping, and due process procedures. Under
this option, if, despite best efforts, an owner or operator cannot find
a third-party auditor meeting all of the criteria in Sec.  68.59(b) or
Sec.  68.80(b), the owner or operator would be required to request
approval, in writing, to the implementing agency to use an alternative
third-party auditor. The implementing agency would then be required,
within a specified timeframe, to approve or disapprove the proposed
request and provide notice of its decision to the owner or operator.
The owner or operator's request to use an alternative third-party
auditor would include a description of the owner or operator's efforts
to find an independent third-party auditor, identification of the
proposed alternative third-party auditor (including the same
information required pursuant to this rule for a fully qualified
auditor), identification of the specific independence requirements the
proposed alternative third-party auditor meets and does not meet, and
an organizational chart of the proposed alternative third-party auditor
and related entities with brief descriptions of the primary nature of
the work each performs.
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    \101\ CARB. July 23, 2015. Verification of GHG Emissions Data
Reports. http://www.arb.ca.gov/cc/reporting/ghg-ver/ghg-ver.htm.
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    The owner or operator's request to use an identified alternative
third-party auditor would also include a Conflict of Interest
Mitigation Plan demonstrating the steps the auditor would take to
mitigate its inability to fully meet the independence requirements in
Sec.  68.59(b) or Sec.  68.80(b). These steps could include ensuring
that any individual or organizational component of the auditor with
conflicts of interest or impartiality concerns is removed from the
audit and/or isolated from the individuals or organizational component
conducting the audit, an explanation of how and why the amount and
nature of work previously performed should not be deemed to undermine
the auditing team's credibility and lack of bias, and descriptions of
any other adjustments or circumstances taken to address actual or
potential sources for conflicts of interest, with an appropriate
certification signed and dated by a senior owner or operator official.
    If, pursuant to this option, the implementing agency approves the
alternative third-party auditor, it would provide written notice to the
owner or operator and, upon receipt of the approval, the owner or
operator may engage the alternative auditor to conduct the audit under
this section. If the implementing agency does not approve the
identified alternative auditor, the implementing agency would provide a
written notice to the owner or operator stating the reasons for the
decision. Within a specified timeframe after receipt of such written
notice, the owner or operator would be required to submit the name of
another proposed auditor for the implementing agency's consideration.
In the alternative, the owner or operator would be able to appeal the
implementing agency's decision pursuant to the applicable agency's
processes.
    EPA considered but did not propose other third-party auditor
independence safeguards than those included in proposed Sec.
68.59(b)(2) or Sec.  68.80(b)(2). Examples include mandating the random
assignment of auditors, paying them from a central pool of auditing
funds, or requiring mandatory periodic auditor rotation after a
specified period of time. Nor has EPA proposed provisions requiring
owners and operators to provide advance notice to the implementing
agency of third-party auditor site visits to enable the implementing
agency to accompany and observe the third-party auditors on such
visits.\102\ EPA seeks comment on these alternative approaches.
---------------------------------------------------------------------------

    \102\ Compare proposed 40 CFR 770.7(a)(3)(iv) of EPA's proposed
Toxic Substances Control Act (TSCA) formaldehyde in wood products
third-party program proposed rule: ``(3) Responsibilities. EPA
recognized Laboratory ABs must fulfill the requirements in
paragraphs (b)(3)(i) through (xiii) of this section: . . . (iv) Upon
request, allow EPA representatives to accompany its assessors during
an on-site assessment to observe the audit of a TPC.'' Formaldehyde;
Third-Party Certification Framework for the Formaldehyde Standards
for Composite Wood Products, 78 FR 34796, June 10, 2013. http://www.gpo.gov/fdsys/pkg/FR-2013-06-10/pdf/2013-13254.pdf.
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    EPA further seeks comment on whether there are any other
alternative approaches to third-party auditor qualifications EPA should
consider prior to issuing a final action. For example, EPA could, in
the final rule, allow for audits to be performed by auditors with some
potential conflicts of interest (e.g., employees of parent company,
affiliates, vendors/contractors that participated in developing the
facility's RMP, etc.) and/or allow a person employed at the facility
who is a registered PE to conduct the audit. If such approaches are
adopted in the final rule, the Agency could seek to place appropriate
restrictions on auditors and auditing using third parties with less
than full independence from their client facilities in an effort to
increase confidence that the auditors will act appropriately when
performing their activities under the RMP rule. The purposes of such
provisions could include ensuring that auditor personnel who assess a
facility's compliance with the RMP rule do not receive any financial
benefit from the outcome of their auditing decisions, apart from their
basic salaries or remuneration for having conducted the audits. EPA
also specifically requests commenters to identify any supportive
literature or data as EPA is presently not aware of literature or data
showing that such provisions are effective in counteracting biases due
to lack of impartiality or independence.
    There may be other options, in addition to the approaches taken in
the proposed third-party compliance auditing program or identified
above, that can also increase owner or operator flexibility without
compromising audit accuracy. EPA seeks comment on such alternative
auditor/auditing approaches.
    If non-independent or limited independence third-party auditing,
second-party auditing, or enhanced self-auditing is authorized, EPA
seeks comment on how best to structure such auditing to maximize
auditor independence and accurate auditing outcomes given the lack of
complete

independence. EPA also seeks suggestions for what steps a facility
should be required to take if third-party auditors who meet the
proposed independence and competence criteria are not available. If RMP
facilities are allowed, in the final rule, to use enhanced self-
auditing in lieu of independent third-party auditing, examples of the
types of restrictions that could be placed on such self-auditing to
potentially improve auditor impartiality and auditing outcomes appear
in the U.S. and CARB v. Hyundai Motor Company, et al. Consent
Decree.\103\
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    \103\ U.S District Court of DC November 11, 2014. Decree of
Consent U.S California Air Resources Board v. Hyundai et al. http://www2.epa.gov/sites/production/files/2014-11/documents/hyundai-kia-cd.pdf.
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Third-Party Audit Report
    Proposed Sec. Sec.  68.59(c) and 68.80(c), if finalized, would
require owners or operators of stationary sources to ensure that their
third-party auditors prepare and submit audit reports. Proposed
Sec. Sec.  68.59(c)(1) and 68.80(c)(1), if finalized, would include
requirements for the scope and content of these reports, including a
statement to be signed by the third-party auditor certifying that the
third-party audit was performed in accordance with the requirements of
subpart C or D. Proposed Sec. Sec.  68.59(c)(1) and 68.80(c)(1), if
finalized, would also require that the final third-party audit reports
must identify any adjustments made by the third-party auditor to any
draft third-party audit reports provided to the owners or operators for
their review or comment. EPA believes that these provisions are
important to minimize third-party compliance audit bias. EPA's intent
in allowing for owners and operators to receive and comment on draft
third-party compliance audit reports with these additional requirements
is to promote factual and informative final third-party compliance
audit reports without compromising their accuracy and independence. EPA
seeks comment, however, on whether we should also require draft third-
party compliance audit reports to be submitted to the implementing
agency at the same time, or before, such reports are provided to the
owners and operators and whether such a requirement would be further
effective in minimizing potential third-party compliance audit bias.
    Proposed Sec. Sec.  68.59(c)(2) and 68.80(c)(2), if finalized,
would include requirements for the retention of reports and records by
the third-party auditors. Proposed Sec. Sec.  68.59(c)(3) and
68.80(c)(3), if finalized, would require the audit report to be
submitted to the implementing agency at the same time, or before, it is
provided it to the owner or operator. Finally, EPA is proposing in
Sec. Sec.  68.59(c)(4) and 68.80(c)(4) that the audit report and
related records cannot be claimed as attorney-client communications or
as attorney work products even if the auditors are themselves, or are
managed by or report to, attorneys. With respect to the attorney work
product privilege, the audit report and related records are produced to
document compliance rather than in anticipation of litigation, just
like a monitoring report required by an air emission rule would not be
produced in anticipation of litigation. With respect to the attorney-
client communication privilege, the third-party auditor is arms-length
and independent of the stationary source being audited. The auditor
lacks an attorney-client relationship with counsel for the audited
entity. Therefore, neither the audit report nor the records related to
the audit report provided to the third-party auditor are attorney-
client privileged (including documents originally prepared with
assistance or under the direction of the audited source's attorney).
EPA seeks comment on these proposed requirements including any legal
concerns that may result from the provision that limits attorney-
related privileges.
Other Owner or Operator Obligations
    Proposed Sec. Sec.  68.59(d)(1) and 68.80(d)(1), if finalized,
would require owners or operators, as soon as possible, but no later
than 90 days after receiving the final audit report, to determine an
appropriate response to each of the findings in the audit report, and
develop and provide to the implementing agency a findings response
report. This findings response report would include: A copy of the
final audit report; an appropriate response to each of the audit report
findings; a schedule for promptly addressing deficiencies; and a
statement, signed and dated by a senior corporate officer, certifying
that appropriate responses to the findings in the audit report have
been identified and deficiencies were corrected, or are being
corrected, consistent with the requirements of subpart C or D of 40 CFR
part 68. The requirement to determine appropriate responses to findings
is similar to existing compliance audit requirements that require the
owner or operator to ``promptly determine and document an appropriate
response to each of the findings of the compliance audit.'' EPA seeks
comment on these proposed requirements and whether we should provide
flexibility on the timeframe for developing the findings response
report.
    EPA also considered prescribing a timeframe within which
deficiencies must be corrected, rather than rely on ``promptly''
address deficiencies. However, EPA was unable to identify an
appropriate timeframe given the variety of possible site-specific
actions that an owner or operator may take to address audit findings.
EPA seeks comment on whether to keep this approach or substitute a
specific number of days and, if the latter, what is a reasonable time
period to specify and why.
    Proposed Sec. Sec.  68.59(d)(2) and 68.80(d)(2), if finalized,
would require the owner or operator to implement the schedule and
address deficiencies identified in the audit findings response report,
and document the action taken to address each deficiency, along with
the date completed. Proposed Sec. Sec.  68.59(d)(3) and 68.80(d)(3), if
finalized, would require the owner or operator to provide a copy of
documents required under paragraphs (d)(1) and (d)(2) to the owner or
operator's audit committee of the Board of Directors, or other
comparable committee, if one exists. EPA seeks comment on these
proposed requirements.
    Proposed Sec. Sec.  68.59(e) and 68.80(e), if finalized, would
require the owner or operator to retain records at the stationary
source, including: the two most recent third-party audit reports,
related findings response reports, documentation of actions taken to
address deficiencies, and related records; and copies of all draft
third-party audit reports. The owner or operator shall provide draft
third-party audit reports, or other documents, to the implementing
agency upon request. For proposed Sec.  68.59(e) (Program 2 third-party
audit recordkeeping provision), these requirements, if finalized, would
not apply to any documents that are more than five years old (for
Program 3 third-party audit records, as for the existing Program 3
compliance audits, the owner or operator would be required to retain
records to support the two most recent audits). EPA seeks comment on
these proposed requirements.

C. Safer Technology and Alternatives Analysis (STAA)

1. Meaning of STAA
    Safer technology and alternatives refer to risk reduction
strategies developed through analysis using a hierarchy of process risk
management strategies (or hierarchy of controls), which consists of
those which are inherent, passive,

active, and procedural.\104\ This philosophy can be applied initially
to all design phases and then continuously throughout a process's life
cycle by identifying and assessing hazards and developing a control
strategy. STAA includes concepts known as IST or inherently safer
design (ISD), which are those strategies that permanently reduce or
eliminate the hazards associated with materials and operations used in
a process. IST, ISD, and inherent safety are interchangeable terms that
are used in the literature and in the field. The four major inherently
safer strategies are:
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    \104\ CCPS. 2009. Inherently Safer Chemical Processes: A Life
Cycle Approach, 2nd ed., American Institute of Chemical Engineers,
CCPS New York, Wiley.

     Minimization-using smaller quantities of hazardous
substances;
     Substitution-replacing a material with a less hazardous
substance;
     Moderation-using less hazardous conditions or a less
hazardous form, or designing facilities that minimize the impact of
a release of hazardous material or energy; and
     Simplification-design facilities to eliminate
unnecessary complexity and make operating errors less likely.

The hierarchy establishes that inherently safer options (e.g.,
minimization, substitution, moderation, and simplification) are
preferable and occupy the top of the hierarchy. Passive strategies
(process and equipment design) are preferable to active ones such as
engineering controls (automatic digital or mechanical system controls),
which are preferable to procedures or administrative options (controls
requiring human action). However, risk reduction of a process hazard
may also be achieved by using a combination of strategies, known as
layers of protection. EPA is proposing to require analysis of safer
technology and alternatives as part of the PHA for a subset of Program
3 processes.
2. Inherently Safer Technology (IST)
    A July 2010 DHS report prepared by the CCPS described IST as a
philosophy and an iterative process, including eliminating a hazard,
reducing a hazard, substituting a less hazardous material, using less
hazardous process conditions, and designing a process to reduce the
potential for, or consequences of, human error, equipment failure, or
intentional harm.\105\ It stated that there is no clear boundary
between IST and passive, active, and procedural risk management
strategies. CCPS further stated that ISTs are relative and can only be
described as inherently safer when compared to a different technology,
including a description of the hazard or set of hazards being
considered, their location, and the potentially affected population.
Because an option may be inherently safer with regard to some hazards
and inherently less safe with regard to others, the decision process
must consider the entire life cycle, the full spectrum of hazards and
risks, and the potential for transfer of risk from one impacted
population to another. This report also noted that there is currently
no consensus on either a quantification method for IST or a scientific
assessment method for evaluation of IST options. The report states that
risk can be reduced by many methods, including ISD, but those methods
must include the full spectrum of risk reduction approaches (passive,
active, and procedural risk management systems). Few technologies will
be inherently safer with respect to all hazards, and other approaches
will usually be required to manage the full range of hazards and risks.
As an example, the report points out that an IST with respect to a
catastrophic release hazard may conflict with methods to minimize other
hazards, such as theft or diversion of materials, contamination of
product, or degradation of infrastructure. It may not address other
hazards at all, or it may create new hazards.
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    \105\ CCPS. July 2010. Final Report: Definition for IST in
Production, Transportation, Storage, and Use. Prepared by: CCPS,
American Institute of Chemical Engineers, New York, New York for
Chemical Security Analysis Center, Science & Technology Directorate,
U.S. DHS Aberdeen Proving Ground, MD. http://www.aiche.org/ccps/documents/definition-inherently-safer-technology.
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3. EPA's Past Approach to STAA
    The RMP rule already embodies most aspects of the hierarchy of
controls. For example, Sec.  68.67 (PHA) requires owners and operators
of Program 3 processes to address process hazards using engineering and
administrative controls. In most cases, the rule's requirements for
compliance with RAGAGEP should ensure that equipment and processes are
properly designed, using appropriate passive, active, and procedural
controls. The RMP rule also encourages passive and active mitigation
for releases by allowing a source to account for such mitigation
techniques in its OCA (see Sec. Sec.  68.25 and 68.28). However, the
rule does not contain any explicit requirement for owners and operators
to address the first tier of the hierarchy of controls--i.e. inherent
safety.
    Although the current rule does not include IST requirements, EPA
has recognized the importance of considering IST for improving process
safety. The preamble of the 1995 supplemental NPRM for the Risk
Management Program recognized ``that there are many opportunities to
make processes inherently safer without large scale adoption of new
technologies (60 FR 13533, March 13, 1995). EPA also noted in the
preamble to the 1996 final RMP rule, ``Application of good PHA
techniques often reveals opportunities for continuous improvement of
existing processes and operations without a separate analysis of
alternatives'' (61 FR 31674, June 20, 1996). The structure of the
applicability provisions of the RMP rule, with TQs, encourages
minimizing the presence of regulated substances in processes and
encourages sources to continue to examine and adopt viable alternative
processing technologies, system safeguards, or process modifications to
make new and existing processes and operations inherently safer. EPA's
existing guidance on the ``general duty clause'' in CAA section
112(r)(1) states that, ``The owners and operators should try to
substitute less hazardous substances for extremely hazardous substances
or minimize inventories when possible. This is usually the most
effective way to prevent accidents and should be the priority of a
prevention program.'' \106\
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    \106\ EPA, Office of Solid Waste and Emergency Response and
Office of Enforcement and Compliance Assurance. May 2000. Guidance
for Implementation of the General Duty Clause, CAA Section
112(r)(1). EPA 550-B00-002. http://www2.epa.gov/rmp/guidance-implementation-general-duty-clause-clean-air-act-section-112r.
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    In the 1996 final RMP rule, EPA decided not to mandate IST
analysis, stating that ``EPA does not believe that a requirement that
owners or operators conduct searches or analyses of alternative process
technologies for new or existing processes will produce significant
additional benefits.'' (61 FR 31688, June 20, 1996). However, since
1996 EPA has seen that advances in ISTs and safer alternatives are
becoming more widely available and are being adopted by some companies.
Voluntary implementation of some ISTs has been identified through
surveys and studies and potential opportunities have been identified
through EPA inspections and CSB incident investigations. EPA now
believes that there is a benefit in requiring that some facilities
evaluate whether they can improve risk management of current hazards
through potential implementation of ISTs or risk management measures
that are more robust and reliable than ones currently in use at the
facility. While EPA believes that facilities should look for additional
opportunities to increase safety, we believe that the facility owners
or operators are in the best position to identify which changes are

feasible to implement for their particular process. As a result, EPA is
not proposing to require that a facility implement a particular
technology or design.
    In addition, in CAA section 112(r) enforcement cases, facility
owners or operators have occasionally entered into consent agreements
involving implementation of safer alternatives. For example, a food
processor in San Francisco had a release of anhydrous ammonia from its
refrigeration system in 2009, resulting in evacuation of the facility
and several neighboring businesses and hospitalization of 17 people. As
part of a consent decree, the facility owner or operator converted the
anhydrous ammonia refrigeration system to a safer technology that uses
glycol and less ammonia, along with implementing other safety measures
and system upgrades.\107\ Following community complaints and a 2011 EPA
inspection, the owner or operator of a fertilizer facility chose to
remove a total of 99,000 pounds of anhydrous ammonia from the facility,
thus reducing the risk to the surrounding population.\108\ In another
case, the owner or operator of a dairy company agreed to reduce the
anhydrous ammonia inventory and improve release detection equipment at
two facilities after two anhydrous ammonia releases in 2005 and 2007
(the latter causing nine people to spend a night in the hospital) and
after EPA identified CAA violations.\109\ The owner or operator of a
Connecticut metal finishing facility that used chlorine gas for
treatment of cyanide waste agreed to implement a project to eliminate
the use of chlorine by substituting liquid sodium hypochlorite after
EPA found violations of accident prevention regulations.\110\ A release
from one of the chlorine cylinders at the facility could potentially
have impacted offsite public receptors in a densely populated
area.\111\ Thus, EPA's historic approach to STAA under CAA section
112(r) has resulted in chemical plant operators introducing safer
technology and alternatives through implementation of existing rule
provisions that address most of the hierarchy of controls, but the
Agency has not mandated the use or analysis of IST alternatives.
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    \107\ EPA News Release. January 31, 2012. South San Francisco
Food Processing Factory Will Pay Nearly $700,000 in Penalties, Spend
$6 Million to Update Refrigeration System Safety. http://yosemite.epa.gov/opa/admpress.nsf/0/1c6b8ee238fd17d185257996005b892f.
    \108\ EPA News Release. August 14, 2013. Abilene Products Co.,
Inc., Agrees to $90,660 Settlement for Violations of CAA at Abilene,
Kan., Fertilizer Facility. http://yosemite.epa.gov/opa/admpress.nsf/0/8BB676093B7826FF85257BC7006B3E4C.
    \109\ EPA News Release. October 1, 2012. Settlement with Suiza
Dairy Corporation for Violations at facilities in Puerto Rico will
make facilities safer, benefit nearby communities. http://yosemite.epa.gov/opa/admpress.nsf/0/319D803456BF7B0885257A8A005A4238.
    \110\ EPA Region 1. January 20, 2014. Consent Agreement and
Final Order--In the Matter of: Metal Finishing Technologies, LLC
Docket Number: CAA-01-2013-0073. http://yosemite.epa.gov/OA/RHC/
EPAAdmin.nsf/Filings/3A95FA64BDE7026C85257C8600214551/$File/
CAFO%20CAA-01-2013-0073.pdf.
    \111\ EPA Region 1. September 30, 2013. Administrative
Complaint--In the Matter of: Metal Finishing Technologies, LLC
Docket Number: CAA-01-2013-0073. http://yosemite.epa.gov/OA/RHC/
EPAAdmin.nsf/Filings/1BE4A3485C3E1E6B85257C1C0021490D/$File/CAA-01-
2013-0073%20Complaint.pdf.
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4. Public Input on STAA
    Public feedback and input to the Working Group established to
oversee Executive Order 13650, showed there was broad agreement among
facility owners and operators, plant workers, community members, and
environmental and union organizations of the benefits of implementing
safer alternatives where feasible. There was, however, no consensus
about the role of government in the implementation of safer
technologies and alternatives. Industry representatives are wary about
process design and operational decisions, including choices of IST,
being imposed through regulations. Process design and operational
decisions are technically complex and often difficult to regulate.
Conversely, many labor and environmental justice representatives
believe the Federal government should have a larger role in encouraging
IST, with particular emphasis on the opportunity to reduce the
vulnerability of residents and workers from incidents.\112\
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    \112\ Chemical Facility Safety and Security Working Group. May
2014. Executive Order 13650 Report to the President--Actions to
Improve Chemical Facility Safety and Security--A Shared Commitment.
EPA, the Department of Labor (DOL), DHS, the Department of Justice
(DOJ), the Department of Agriculture (DOA), and the Department of
Transportation. Washington, DC. https://www.osha.gov/chemicalexecutiveorder/final_chemical_eo_status_report.pdf.
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a. Pending Petition on IST
    In July of 2012, a coalition representing 54 organizations and
individuals petitioned EPA to use its rulemaking authority under CAA
section 112(r)(7)(A), ``to require the use of IST, where feasible, by
facilities that use or store hazardous chemicals.'' The petitioners
also requested that pending completion of such rulemaking, that EPA
should:

    revise its guidance concerning the enforcement of the CAA
general duty clause, section 112(r)(1), 42 U.S.C. 7412(r)(1), to
make clear that the duty to prevent releases of extremely hazardous
substances includes the use, where feasible, of safer technologies
to minimize the presence and possible release of hazardous
chemicals.\113\
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    \113\ Greenpeace et al. July 25, 2012. Petition to Prevent
Chemical Disasters from Rick Hind of Greenpeace, Richard Moore of
Los Jardines Institute and Scott Nelson of Public Citizen sent to
EPA Administrator Lisa Jackson, EPA, Washington, DC,
www.documentcloud.org/documents/404584-petition-to-epa-to-prevent-chem-disasters-filed.html.
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    The petitioners stated that many Americans remain at risk of injury
or death from the unforeseen release of harmful chemicals from nearby
industrial parks, water treatment plants, etc., and that the DHS CFATS,
which impose security measures on facilities presenting a high risk of
vulnerability to releases of hazardous substances, do not cover water
treatment facilities, many of which use and store significant
quantities of chlorine gas.
    The petitioners cited specific threats or accidents as examples of
risks that, in their view, should have been addressed by taking steps
to eliminate or minimize extremely hazardous substances \114\ where
feasible. Examples they cited include a 2009 explosion at a refinery in
Corpus Christi, Texas, that resulted in the release of more than a ton
of hydrogen fluoride, with a much larger release being narrowly
avoided.\115\ A 2008 explosion and fire at a Bayer CropScience facility
in West Virginia narrowly missed causing a breach in piping on the top
of an aboveground tank of methyl isocyanate (MIC), which the
petitioners claimed, if breached, would have resulted in a deadly
release of the same chemical responsible for the Bhopal, India
disaster.\116\ They also

identified a 2007 propane explosion and fire at a refinery in Texas
that resulted in the release of nearly three tons of chlorine gas, with
deaths and injuries avoided only by prompt evacuation of workers. The
CSB, which reported the chlorine release as 5,332 pounds, recommended
the refinery replace chlorine used as a biocide in cooling water
treatment with inherently safer materials, such as sodium hypochlorite,
at all its refineries.\117\ The petitioners also cited several examples
where readily available IST approaches have already been used, such as
substitution of liquid bleach or ultraviolet light for chlorine in
water disinfection 118 119 and the use of alternatives to
replace HF in gasoline refining.\120\
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    \114\ This not intended to specifically reference the extremely
hazardous substances listed under Sec.  302 of EPCRA. Section
112(r)(1) of the CAA provides a purpose and general duty to prevent
the accidental release and to minimize the consequence of any
release of any regulated substances promulgated by EPA under Sec.
112(r)(3) (40 CFR part 130) and for ``any other extremely hazardous
substance.'' Although the term ``any other extremely hazardous
substance'' is not defined, the legislative history of the 1990 CAAA
indicate that the term would include any agent ``which may or may
not be listed or otherwise identified by any Government agency which
may as the result of short-term exposures associated with releases
to the air cause death, injury or property damage due to its
toxicity, reactivity, flammability, volatility, or corrosivity.''
See: http://www2.epa.gov/sites/production/files/2013-10/documents/gdcregionalguidance.pdf.
    \115\ Petitioners are referring to an accident at the CITGO
Refinery in Corpus Christi, Texas. For more information on this
accident, see CSB. December 9, 2009. CITGO Refinery HF Release and
Fire, Corpus Christi, Texas. Final Report, Urgent Recommendation.
http://www.csb.gov/citgo-refinery-hydrofluoric-acid-release-and-fire/.
    \116\ CSB. January 2011. Investigation Report: Pesticide
Chemical Runaway Reaction Pressure Vessel Explosion, Bayer
CropScience, LP, Institute, West Virginia, August 28, 2008. Report
No. 2008-08-I-WV, pp. 88-89, http://www.csb.gov/assets/1/19/Bayer_Report_Final.pdf.
    \117\ CSB. July 9, 2008. Investigation Report: LPG Fire at
Valero-McKee Refinery, Sunray, Texas, February 16, 2007. Report No.
2007-05-I-TX. http://www.csb.gov/assets/1/19/CSBFinalReportValeroSunray.pdf.
    \118\ Orum, Paul and Rushing, Reece. March 2, 2010. Leading
Water Utilities Secure Their Chemicals. Center for American
Progress, Washington, DC. https://www.americanprogress.org/issues/security/news/2010/03/02/7538/leading-water-utilities-secure-their-chemicals/.
    \119\ M. McCoy. November 9, 2009. Clorox to Stop Using Chlorine.
Chemical & Engineering News.http://cen.acs.org/articles/87/i45/Clorox-Stop-Using-Chlorine.html.
    \120\ Morris, J. and Hamby, C. May 19, 2014. Use of toxic acid
puts millions at risk. Center for Public Integrity. Washington,
DC.http://www.publicintegrity.org/2011/02/24/2118/use-toxic-acid-puts-millions-risk.
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b. National Academy of Sciences (NAS) and CSB Investigation Findings
    A 2012 report from the NAS that examined the 2008 Bayer CropScience
accident in West Virginia and community concerns surrounding MIC (and
other highly toxic materials), found that inherently safer process
assessments can be valuable components of PSM that can help facility
personnel consider the full range of options in process design.\121\
The NAS report found that while Bayer and previous owners of the site
incorporated some considerations of IST, these companies ``did not
perform systematic and complete inherently safer process assessments on
the processes for manufacturing MIC or the carbamate pesticides at the
Institute site.'' Thus, large amounts of MIC, phosgene, and other toxic
materials were produced or stored at the site for decades.
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    \121\ NAS. 2012. Summary--The Use and Storage of MIC at Bayer
CropScience. pp. 3, 7. http://dels.nas.edu/resources/static-assets/materials-based-on-reports/reports-in-brief/MIC-Summary-Final.pdf.
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    The NAS also found that industry as a whole lacks a common
understanding of what is needed to identify inherently safer processes
and accurately quantify their benefits, including the potential for
reduced emergency preparedness costs. The NAS panel noted that the goal
of ISD is not only to prevent an accident, but also to reduce the
consequences of an accident should one occur, thus allowing emergency
preparedness planners to focus on more readily manageable scenarios.
    NAS found that inherently safer process assessments will not always
result in a clear, well-defined, and feasible path forward. Although
one process alternative may be inherently safer with respect to one
hazard--toxicity of byproducts, for example--the process may present
other hazards, such as an increased risk of fire or more severe
environmental impacts. Choosing between options for process design
involves considering a series of tradeoffs and developing appropriate
combinations of inherent, passive, active, and procedural safety
systems to manage all hazards.
    A 2011 analysis of 63 CSB accident investigation reports, studies
and bulletins by Canadian university researchers identified over 200
examples of recommendations for risk reduction measures from the
hierarchy of controls that apply to the prevention of accidents or
consequence mitigation. Thirty-six percent of the examples involved
inherent safety, 8% involved passive engineered safety, 14% involved
active engineered safety and 42% involved procedural safety. ISD items
were observed to be equally split among the four primary ISD principles
of minimization, substitution, moderation and simplification.\122\
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    \122\ Paul R. Amyotte, Dustin K. MacDonald, Faisal I. Khan.
September 2011. An analysis of CSB investigation reports concerning
the hierarchy of controls. Process Safety Progress. Volume 30, Issue
3, pp. 261-265. http://onlinelibrary.wiley.com/doi/10.1002/prs.10461/abstract.
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    The CSB has released reports for two recent accidents that the
Board indicated could have been avoided if safer technologies had been
employed. CSB found that the use of a safer material, such as high-
chromium steel, would have prevented the accelerated corrosion and
failure of carbon steel involved in the equipment rupture at the Tesoro
Refinery in Anacortes, Washington, in 2010, which resulted in an
explosion and fire that killed seven employees.\123\ One recommendation
from this CSB accident investigation was that EPA should revise the RMP
rule to require the documented use of inherently safer systems analysis
and the hierarchy of controls to the greatest extent feasible when
facilities are establishing safeguards for identified process hazards.
CSB also cited the failure to use more corrosion resistant high-
chromium steel as a factor in the 2012 Chevron Refinery accident in
Richmond, California, which released hydrocarbons that ignited,
endangering 19 employees.\124\
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    \123\ CSB. May 2014. Investigation Report: Catastrophic Rupture
of Heat Exchanger, Tesoro Anacortes Refinery, Anacortes, Washington,
April 2, 2010. Report 2010-08-I-WA. http://www.csb.gov/assets/1/7/Tesoro_Anacortes_2014-May-01.pdf.
    \124\ CSB. January 2014. Regulatory Report: Chevron Richmond
Refinery Pipe Rupture and Fire, Chevron Richmond Refinery #4 Crude
Unit, Richmond, California, August 6, 2012. Report No. 2012-03-I-CA.
http://www.csb.gov/assets/1/19/CSB_Chevron_Richmond_Refinery_Regulatory_Report.pdf.
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c. State and Local IST Programs
    Some state and local governments have included inherent safety
requirements in their regulations. An IST Review Rule was adopted under
the New Jersey TCPA program in May 2008.\125\ It requires IST reviews
of all facilities covered by the TCPA by evaluating, at a minimum, the
four IST principles: minimization, substitution, moderation, and
simplification. NJDEP defined ``IST'' to mean ``the principles or
techniques that can be incorporated in a covered process to minimize or
eliminate the potential for an Extraordinarily Hazardous Substance
release.'' \126\
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    \125\ NJDEP. March 29, 2012. NJDEP Title 7, Chapter 31 TCPA
Program Consolidated Rule Document. Pages 17, 66 -68. http://www.state.nj.us/dep/rpp/brp/tcpa/downloads/conrulerev9_fonts.pdf.
    \126\ NJDEP uses the term ``Extraordinarily Hazardous
Substance'' to describe the substances that are subject to the NJ
TCPA.
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    The rule includes a checklist developed under the direction of the
New Jersey Domestic Security Preparedness Task Force. The NJDEP allows
any available IST analysis method to be used to perform the IST review,
but discusses two methods which are commonly used: (1) Integrating IST
into the facility's PHA study and (2) reviewing and completing a
checklist containing a number of practical inherent safety
considerations.\127\ The NJDEP also requires an IST review report that
includes:
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    \127\ NJDEP, Bureau of Release Prevention. January 15, 2015.
Guidance for TCPA, IST Review, Rev. 1. http://www.nj.gov/dep/rpp/brp/tcpa/downloads/IST_guidance.pdf.

     Information on the review team (name, position,
qualifications, etc.);
     IST analysis method used;
     IST already present in the process;
     Additional IST identified;
     IST to be implemented, and a schedule for their
implementation; and

     A list of IST determined to be infeasible.

A facility owner or operator must determine an identified alternative's
feasibility, and must provide written justification based on both
qualitative and quantitative evaluations of environmental, human health
and safety, legal, technological, and economic factors if it decides
not to implement it. The ACC noted that NJDEP's definition of inherent
safety allowed ``add-on'' safety equipment and included routine safety
improvements that are not part of the inherent safety concept as
defined by CCPS and others.\128\ NJDEP visited every regulated facility
and reviewed the IST report with the facility staff. A January 2010
report prepared by the NJDEP to summarize the Department's review of 85
IST reports indicated that approximately 48% of facilities reported
that they had implemented or scheduled to implement IST measures as a
result of conducting the IST review.\129\
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    \128\ ACC. October 29, 2014. Comment No. EPA-HQ-OEM-2014-0328-
0694 on Risk Management Program RFI, pg. 25.
    \129\ NJDEP. January 15, 2010. IST Implementation Summary.
http://www.nj.gov/dep/rpp/brp/tcpa/downloads/IST_SUMWEB.pdf.
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    California's Contra Costa County's ISO \130\ and the City of
Richmond, California's ISO \131\ require owners and operators of
stationary sources to consider ISS in the development and analysis of
mitigation systems resulting from a PHA for each covered process, and
in the design and review of new processes and facilities. Contra Costa
County's CC ISO defined ISS as
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    \130\ Contra Costa County CA. 2006. ISO Code, Title 4--Health
and Safety, Division 450--Hazardous Materials and Wastes, Chapter
450-8--Risk Management. Contra Costa County, California pp. 5, 21-
22. http://cchealth.org/hazmat/pdf/iso/Chapter-450-8-RISK-MANAGEMENT.pdf.
    \131\ The Richmond ISO is identical to the Contra Costa County
ISO except it does not include the 2006 amendments made to the
Contra Costa ISO which require a safety culture assessment, a human
factors program, management of change for maintenance, health and
safety positions, and a security vulnerability analysis. CCHS. July
26, 2011.ISO. City of Richmond Annual Performance Review and
Evaluation Report. CCHS, Contra Costa County, CA. http://cchealth.org/hazmat/pdf/iso/iso_report_richmond.pdf.

    ``ISD strategies'' as discussed in the latest edition of the
CCPS publication, ``Inherently Safer Chemical Processes,'' \132\ and
to mean feasible alternative equipment, processes, materials, lay-
outs, and procedures meant to eliminate, minimize, or reduce the
risk of a major chemical accident or release by modifying a process
rather than adding external layers of protection. Examples include,
but are not limited to, substitution of materials with lower vapor
pressure, lower flammability, or lower toxicity; isolation of
hazardous processes; and use of processes which operate at lower
temperatures and/or pressures.
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    \132\ CCPS. 2009. Inherently Safer Chemical Processes: A Life
Cycle Approach, 2nd ed., American Institute of Chemical Engineers,
CCPS New York, Wiley.

    The Contra Costa County ISO requires that the stationary source
must select and implement ISS to the greatest extent feasible and as
soon as administratively practicable. If a stationary source concludes
that implementation of an ISS is not feasible, the stationary source
must document the basis for this conclusion in meaningful detail.
Contra Costa County requires the documentation to include sufficient
evidence to demonstrate to CCHS's satisfaction that implementing the
ISS is not feasible and the reasons for this conclusion. A claim that
implementation of an ISS is not feasible cannot be based solely on
evidence of reduced profits or increased costs. A February 2013 report
prepared by CCHS on their ISO program indicated that 4 of 7 facilities
covered under the ordinance's ISS provision implemented at least one
inherently safer measure within the previous year.\133\ The February
2014 CCHS ISO report \134\ indicated that 3 of the 7 facilities
reported three or more ISS implemented during the last reporting year.
In the city of Richmond, California, as of July 2011, the two
facilities covered by the Richmond ISO had implemented 62 safer
alternative measures involving ISSs.\135\ In June 2014, the Contra
Costa County ISO requirements were expanded to require evaluation and
documentation of ISS analysis for new projects and processes and for
existing processes, whenever major changes resulting from incident
investigation recommendations, root cause analysis, or MOC review
indicate that change could reasonably result in a major chemical
accident or release.
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    \133\ CCHS. February 26, 2013. Annual Performance Review and
Evaluation-ISO.
    \134\ CCHS. December 9, 2014. Annual Performance Review and
Evaluation-ISO. http://cchealth.org/hazmat/pdf/iso/iso-report.pdf.
    \135\ CCHS. July 26, 2011. ISO. City of Richmond Annual
Performance Review and Evaluation Report. http://cchealth.org/hazmat/pdf/iso/iso_report_richmond.pdf.
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d. Industry and Trade Association Input
    Numerous trade associations (ACC,\136\ SOCMA,\137\ Independent
Petroleum Association of America [IPAA] and American Exploration &
Production Council [AXPC],\138\ API,\139\ Association of Metropolitan
Water Agencies [AMWA],\140\ National Association of Chemical
Distributors [NACD],\141\ National Association of Manufacturers
[NAM],\142\ CGA,\143\ Chlorine Institute [CI],\144\ AFPM,\145\ Chemical
Safety Advocacy Group [CSAG] \146\), one company, Axiall
Corporation,\147\ and the Mary Kay O'Connor Process Safety Center
[MKOPSC],\148\) noted in their comments on EPA's RFI, that IST is only
one of many approaches that may be employed to achieve risk reduction.
They also noted that identification and evaluation of a safer
alternative is not an off-the-shelf concept, but requires a holistic
and often complex evaluation involving various factors. The commenters
also indicated that IST decisions must be process-, site-, and hazard-
specific, technically and economically feasible, and avoid shifting
risk. These commenters stated that a regulatory program focused
exclusively on eliminating a safety hazard would overlook other
important considerations and risks that must be factored into an
evaluation of a process change. They further contended that improper
implementation of a seemingly safer alternative may lead to undesired
consequences. The commenters argued that because an option may be
inherently safer with regard to some hazards and inherently less safe
with regard to others, decisions about the optimum strategy for

managing risks from all hazards are required.
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    \136\ ACC. October 29, 2014. Comment No. EPA-HQ-OEM-2014-0328-
0694 on Risk Management Program RFI, PDF pp. 16-28 of 189.
    \137\ SOCMA. October 29, 2014. Comment No. EPA-HQ-OEM-2014-0328-
0560 on Risk Management Program RFI, pp. 3-6.
    \138\ IPAA and AXPC. October 29, 2014. Comment No. EPA-HQ-OEM-
2014-0328-0584 on Risk Management Program RFI, pp. 21-24.
    \139\ API. October 29, 2014. Comment No. EPA-HQ-OEM-2014-0328-
0624 on Risk Management Program RFI, pp. 24-26.
    \140\ AMWA. October 29, 2014. Comment No. EPA-HQ-OEM-2014-0328-
0639 on Risk Management Program RFI, pp. 1-7.
    \141\ NACD. October 29, 2014. Comment No. EPA-HQ-OEM-2014-0328-
0614 on Risk Management Program RFI, pgs. 6-7.
    \142\ NAM. October 29, 2014. Comment No. EPA-HQ-OEM-2014-0328-
0625 on Risk Management Program RFI, pg. 2.
    \143\ CGA. October 29, 2014. Comment No. EPA-HQ-OEM-2014-0328-
0633 on Risk Management Program RFI, pg. 4.
    \144\ CI. October 29, 2014. Comment No. EPA-HQ-OEM-2014-0328-
0642 on Risk Management Program RFI, pgs. 7-8.
    \145\ AFPM. October 29, 2014. Comment No. EPA-HQ-OEM-2014-0328-
0665 on Risk Management Program RFI, pgs. 35-38.
    \146\ CSAG. October 29, 2013. Comment No. EPA-HQ-OEM-2014-0328-
0691 on Risk Management Program RFI, pgs. 38-21.
    \147\ Axiall Corp. October 29, 2013. Comment No. EPA-HQ-OEM-
2014-0328-0549 on Risk Management Program RFI, pg. 5.
    \148\ MKOPSC. October 29, 2014. Comment No. EPA-HQ-OEM-2014-
0328-0543 on Risk Management Program RFI, pgs. 101-108.
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    In their comments on the RFI, AMWA \140\ also stated that decisions
to select the most appropriate water treatment methods are best made by
water utility managers based on a variety of factors. Most importantly,
they stated, these managers should also determine which chemical will
most effectively make water safe for public consumption and achieve
compliance with the requirements of the Safe Drinking Water Act.\149\
According to AMWA, allowing Federal officials to ``second-guess'' these
local decisions--with a focus on minimizing potential terror attack
consequences offsite, rather than ensuring the appropriate treatment
and safety of drinking water--could lead to inadequately treated water
and even detriments to public health. AMWA also stated that if
utilities were simply instructed to consider whether an alternative
might be appropriate for them, the costs could be relatively small.
But, in AMWA's view, if this analysis were required to include numerous
prescribed steps, calculations and justifications for subsequent
decisions, then costs could quickly escalate beyond what is reasonable
and affordable.
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    \149\ AMWA. October 29, 2014. Comment No. EPA-HQ-OEM-2014-0328-
0639 on Risk Management Program RFI, pgs. 4-5.
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    MunicpalH2O, a Risk Management Program/PSM compliance consultant
for the water/wastewater treatment industry, commented that
implementing these changes is very expensive and cost prohibitive. The
commenter suggested that if a new requirement is placed on regulated
water and wastewater facilities to perform an analysis of safer
technology and alternatives, those facilities that have previously
completed an analysis of safer technology and alternatives for their
operation should be allowed to utilize their already completed analysis
and be exempt from any future requirement in this area.\150\
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    \150\ MunicipalH2O. October 28, 2103. Comment No. EPA-HQ-OEM-
2014-0328-0588 on Risk Management Program RFI, pgs. 6-7.
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    The American Water Works Association (AWWA) stated that it has
found that options often classified as inherently safer may in fact
have impacts that counter other Federal initiatives associated with the
nation's transportation systems, energy consumption, and carbon dioxide
emissions.\151\ Because of these risk tradeoffs, critical factors and
variables, AWWA maintained that the choice of disinfectant should lie
with qualified local officials, who are best acquainted with the
specifics of their local situation.
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    \151\ AWWA. October 29, 2013. Comment No. EPA-HQ-OEM-2014-0328-
0648 on Risk Management Program RFI, pgs. 3-5.
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    NACD stated that requiring manufacturers to hold smaller quantities
of hazardous materials on site would exhaust their limited inventories
faster.\141\ The commenter also indicated that distributors would need
to deliver hazardous chemicals to these facilities more frequently,
thereby significantly increasing the number of miles driven to deliver
the same amount of product and ultimately increasing and shifting risk
to the public roadways. In addition, NACD suggested there is a higher
risk of incident during product loading and unloading, and that more
shipments would increase the number of times chemicals must be loaded
and unloaded, thereby increasing risk. NACD also stated that fixed-site
risks are more manageable than those with a transportation component.
5. Proposed Revisions to Regulatory Text
    Based on the considerations discussed above, EPA is proposing to
modify the PHA provisions in Sec.  68.67 to require analysis of
potential safer technology and alternatives that would include, in the
following order of preference: IST or ISD, passive measures, active
measures, and procedural measures. EPA is limiting the proposed
provisions to Program 3 processes in the petroleum and coal products
manufacturing (NAICS 324), chemical manufacturing (NAICS 325), and
paper manufacturing (NAICS 322) sectors for reasons discussed in
section IV.C.6. STAA Applicability.
    EPA is also proposing to require owners or operators to evaluate
the feasibility of implementing any IST or ISD considered. EPA believes
a feasibility analysis of any considered IST or ISD is necessary to
ensure the facility owner or operator seriously considers whether IST
or ISD modifications could further reduce risks and prevent accidents
at the facility.
    EPA is proposing to use the term ``feasibility'' to describe this
analysis because it is already widely used in the context of IST.
However, this term has a distinct meaning under the Occupational Safety
and Health Act, where the courts look to whether a safety measure is
capable of being done.\152\ In the enforcement context, feasibility
means that technical know-how about materials and methods is available
or adaptable to specific circumstances, which when applied creates a
reasonable possibility that employee exposure to occupational hazards
will be reduced, and that the firm is financially able to implement the
measure without severe adverse economic effect.\153\ Because of the
potential for confusion, OSHA has indicated that it would be unable to
adopt the term feasible, as defined in this notice, under its PSM
standard if OSHA considers similar revisions involving IST. EPA seeks
comment on whether it would be better if EPA used another term, such as
``practicability'' for this analysis.
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    \152\ See American Textile Mfrs. Inst. v. Donovan, 452 U.S. 490,
509 (1981); Seaworld of Florida, LLC v. Perez, 748 F.3d 1202, 1215
(D.C. Cir. 2013).
    \153\ OSHA CPL 02-00-159, Field Operations Manual 3-22 (2015);
Avcon, Inc., 23 O.S.H. Cas. (BNA) 1440, 1454 n.24 (O.S.H.R.C. Apr.
5, 2011).
---------------------------------------------------------------------------

    EPA is not proposing to require sources affected by this provision
to implement an evaluated IST or ISD. The decision to implement such
measures must consider the numerous factors related to processes,
facilities, and society at large. Improper implementation of a
seemingly safer alternative may lead to undesired consequences. While
EPA believes that sources should look for additional opportunities to
increase safety, we believe that the facility owners or operators are
in the best position to identify which changes are feasible to
implement for their particular process. This decision should be based
on a careful analysis and take into account: The chemicals present and
their associated hazards; the operations and process conditions
involved; consequences to workers, nearby populations and the
environment; and the types of equipment used that are specific to the
facility's process. The analysis may consider the potential to shift
risk between populations, locations, environmental media (air, water
land), etc.
a. Definitions (Sec.  68.3)
    EPA is proposing to add several definitions that relate to a STAA
in Sec.  68.3. EPA is adding these definitions to describe risk
reduction strategies that the owner or operator may use when
considering safer technology and alternatives.
    First, EPA is proposing a definition for inherently safer
technology or design (see Sec.  68.3 for the proposed definition). The
proposed definition includes risk management measures that would
replace or reduce the use of regulated substances or make operating
conditions less hazardous or less complex. Adopting the use of IST or
ISD

eliminates or reduces hazards by using different materials and/or
process conditions which would make accidental releases less likely, or
the impacts of such releases less severe.
    Second, EPA is proposing a definition for ``passive measures'' (see
Sec.  68.3) that relies on measures that reduce a hazard without human,
mechanical, or other energy input. Examples of passive measures include
pressure vessel designs, dikes, berms, and blast walls.
    The third risk reduction measure that EPA is proposing to define is
``active measures.'' These involve engineering controls that rely on
mechanical, or other energy input to detect and respond to process
deviations. Examples of active measures include alarms, safety
instrumented systems, and detection hardware (such as hydrocarbon
sensors).
    Lastly, ``procedural measures'' would include policies, operating
procedures, training, administrative controls, and emergency response
actions to prevent or minimize incidents (see Sec.  68.3). Examples of
procedural measures may include administrative limits on process vessel
fill levels, procedural steps taken to avoid releases, etc.
    In order to evaluate the ISTs and ISDs considered, EPA is proposing
to define ``feasible'' to include consideration of economic,
environmental, legal, social, and technological factors when
determining if the IST or ISD can be accomplished in a successful
manner within a reasonable period of time (see Sec.  68.3).
Environmental factors could include consideration of risks transferred
elsewhere if a new risk reduction measure is adopted. EPA requests
comment on these proposed definitions. Furthermore, EPA requests
comment on whether the term ``feasible'' is appropriate to characterize
the viability of IST alternatives being considered. Is there another
term, such as ``practicable,'' that may be more appropriate?
b. Process Hazard Analysis (PHA) (Sec.  68.67)
    EPA is proposing to modify the PHA provisions by adding paragraph
(c)(8) to Sec.  68.67, to require that the owner or operator of a
facility with Program 3 processes in NAICS codes 322, 324, and 325
address safer technology and alternative risk management measures
applicable to eliminating or reducing risk from process hazards. EPA is
proposing to add paragraph (c)(8)(i) to specify that the analysis
include, in the following order of preference: IST or design, passive
measures, active measures, and procedural measures. The owner or
operator may evaluate a combination of risk management measures to
reduce risk.
    EPA is also proposing to add paragraph (c)(8)(ii) to require that
the owner or operator determine the feasibility of the IST or ISD
considered. The results of the feasibility analysis must be documented
as part of the current PHA requirements in Sec.  68.67(e), which
requires the owner or operator to document actions to be taken and
resolution of recommendations. EPA seeks comment on whether the
proposed requirements to document feasibility are adequate or if these
requirements should be modified to require a more extensive
documentation of feasibility. For example, EPA could require that the
source document the basis for this conclusion in meaningful detail
(similar to California's Contra Costa County's ISO \154\ requirements).
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    \154\ Contra Costa County CA. 2006. ISO Code, Title 4--Health
and Safety, Division 450--Hazardous Materials and Wastes, Chapter
450-8--Risk Management. Contra Costa County, California pp. 5, 21-
22. http://cchealth.org/hazmat/pdf/iso/Chapter-450-8-RISK-MANAGEMENT.pdf.
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    The PHA must be updated and revalidated every five years in
accordance with paragraph Sec.  68.67(f) and as such, this provides the
owner or operator opportunities to evaluate the feasibility of IST or
ISD considered since the last PHA review. EPA believes that five-year
revalidation will give the owner or operator the opportunity to
identify new risk reduction strategies, as well as revisit strategies
that were previously evaluated to determine whether they are now
feasible. EPA seeks comment on these proposed revisions. Additionally,
EPA requests comment on whether to require STAA documentation be
submitted to EPA and/or the implementing agency.
6. STAA Applicability
    EPA is proposing to limit the applicability of the STAA provisions
to sources in the petroleum and coal products manufacturing (NAICS
324), chemical manufacturing (NAICS 325), and paper manufacturing
(NAICS 322) sectors for two reasons. First, EPA believes that while
most sectors regulated under 40 CFR part 68 could identify safer
technology and alternatives, sources involved in complex manufacturing
operations have the greatest range of opportunities to identify and
implement safer technology, particularly in the area of inherent
safety. These sources generally produce, transform, and consume large
quantities of regulated substances under sometimes extreme process
conditions and using a wide range of complex technologies. Therefore,
such sources can often consider the full range of inherent safety
options, including minimization, substitution, moderation, and
simplification, as well as passive, active, and procedural measures.
This contrasts with regulated sources that simply sell or distribute a
particular regulated substance, such as bulk anhydrous ammonia.
Although such sources may also have opportunities to identify and
implement IST, the existence of such sources is predicated on handling
and distributing a specific regulated substance. Therefore, their
opportunities to implement certain IST strategies such as substitution
or minimization may be limited. Similarly, sources involving relatively
simpler chemical processes may have opportunities to implement chemical
substitution strategies but may be limited in their ability to apply
moderation and simplification strategies.
    Second, EPA notes that RMP facilities in the three selected sectors
have been responsible for a relatively large number of accidents,
deaths, injuries, and property damage.\155\ EPA compared the number of
RMP accidents that occurred between January 1, 2004, and December 31,
2013, reported by twelve industry sectors to the number of facilities
in each sector. Each sector was comprised of industries based on
similar operations involving the RMP substances and complexity. The
twelve sectors were: Petroleum and coal products manufacturing (NAICS
325), paper manufacturing (NAICS 322), chemical manufacturing (NAICS
324), food and beverage manufacturing (NAICS 311, 312), other
manufacturing (all other NAICS 31-33), agricultural chemical
distributors (NAICS 11, 42491), chemical/petroleum wholesalers (NAICS
4246, 4247), other wholesalers (all other NAICS 423, 424), warehouses
(NAICS 493), water supply/wastewater treatment (NAICS 22131, 22132,
924), oil/gas extraction (NAICS 211) and all other (NAICS 211 (except
22131 and 22132), 44, 45, 48, 54, 56, 61, 72). The sector accident
rates (number of accidents divided by the number of facilities in each
sector) ranged from 1.08 to 0.04. Three sectors have significantly
higher accidents rates as compared to other sectors: 1.08 (petroleum
and coal products manufacturing), 0.66 (paper manufacturing) and 0.36
(chemical manufacturing). The petroleum and coal products manufacturing
accident rate

was 6-27 times higher, the paper manufacturing accident rate was about
4-6 times higher, and the chemical manufacturing accident rate was 2-9
times higher than other sectors. Therefore, implementation of safer
technology and alternatives by these facilities in the pulp/paper
manufacturing, chemical manufacturing, and petroleum refining sectors
may prevent serious accidental releases in the future.
---------------------------------------------------------------------------

    \155\ EPA. January 27, 2016. Technical Background Document for
Notice of Proposed Rulemaking: Risk Management Programs under the
Clean Air Act, Section 112(r)(7).
---------------------------------------------------------------------------

    EPA seeks comment on whether the proposal to limit the STAA
provisions to Program 3 regulated processes in NAICS 322, 324, and 325
is appropriate. EPA also seeks comment on whether the Agency should
further limit applicability of the STAA provisions (e.g., to apply only
during the design stage of new processes or facilities, or only to
certain processes). As part of the SBAR Panel process, SERs cited
limitations with flexibility to evaluate alternatives for custom
formula blends and compliance with FDA approval requirements and,
therefore, requested that EPA consider eliminating this provision and/
or exempting batch toll manufacturers from this requirement. EPA seeks
comment on these alternatives.
    Finally EPA seeks comment on whether there are other sectors that
should be subject to the proposed STAA provision. For example, should
EPA require RMP regulated water supply/wastewater treatment facilities
to analyze safer technology and alternatives and document feasibility
of the alternatives?
7. Guidance on Evaluating Safer Technologies and Alternatives
    Some owners or operators have already made process changes
considered to be inherently safer, but others may not have sufficient
information available to effectively assess whether their existing
processes can incorporate inherently safer measures. To assist owners
or operators with evaluating options for safer alternatives, EPA and
OSHA developed a chemical safety alert in June 2015 illustrating the
concepts, principles and examples of safer technology and alternatives
to make industry more aware of this information, while providing
sources of information for further investigation and review.\156\
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    \156\ EPA and OSHA. June 2015. Chemical Safety Alert: Safer
Technology and Alternatives. EPA 550-F-15-503. s http://www.epa.gov/rmp/chemical-safety-alert-safer-technology-and-alternatives.
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    EPA and OSHA have said owners or operators may use any available
methodology or guidance to conduct their STAA, such as approaches
discussed by CCPS (e.g., Hazard and Operability Study (HAZOP), What-
If?, Checklist, Consequence-based methods),\157\ the NJ TCPA IST
guidance materials,\158\ the Inherently Safer Systems Checklist
provided by Contra Costa Hazardous Materials Program,\159\ or the
information on OSHA's Web page, ``Transitioning to Safer Chemicals: A
Toolkit for Employers and Workers.'' \160\ CCPS provides guidelines for
what should be provided in an inherent safety analysis and provides
example rationales for why inherent safety review recommendations were
rejected.\161\ Examples for why inherent safety review recommendations
may not be feasible, include when the recommendation:
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    \157\ CCPS. 2009. Inherently Safer Chemical Processes: A Life
Cycle Approach, 2nd ed., American Institute of Chemical Engineers,
CCPS New York, Wiley.
    \158\ NJDEP, Bureau of Release Prevention. January 15, 2015.
Guidance for TCPA, IST Review. http://www.nj.gov/dep/rpp/brp/tcpa/downloads/IST_guidance.pdf. See also NJWEC. May 5, 2008. New Rule
for IST Review by NJDEP. http://www.njwec.org/PDF/Factsheets/CS_IST_FactSheet.pdf.
    \159\ Contra Costa Hazardous Materials Program. June 15, 2011.
ISS Checklist (extracted from IST Checklist found in the CCPS
Inherently Safer Chemical Processes, 2nd ed., with incorporation of
additional considerations). http://cchealth.org/hazmat/pdf/iso/attachment_c.pdf.
    \160\ OSHA. Transitioning to Safer Chemicals, a Toolkit for
Employers and Workers. https://www.osha.gov/dsg/safer_chemicals/index.html.
    \161\ CCPS. 2009. Inherently Safer Chemical Processes: A Life
Cycle Approach, 2nd ed. American Institute of Chemical Engineers,
CCPS. New York, Wiley, 2009. Pgs. 200-202.

     Is in conflict with existing Federal, state and local
laws.
     Is in conflict with RAGAGEP.
     Is economically impractical, such that the process unit
would stop being fiscally feasible. This can include consideration
of:
     Capital investment;
     Product quality;
     Total direct manufacturing costs;
     Operability of the plant; and/or
     Demolition and future clean-up and disposal cost.
     Would have a negative social impact. Some examples
could include an unacceptable visual or noise impact on the
community, or increased traffic congestion.
     May violate a license agreement that cannot be
modified, and so must remain in effect.
     May decrease the hazard, but would increase the overall
risk.
     Provides less risk reduction than an alternative
recommendation.
8. Alternative Options
    As an alternative option, EPA seeks comment on whether to require
facility owners or operators to implement any of the feasible options
identified in the facility's analysis. This option would rely on the
owner or operator to select the specific technology or design to
implement. EPA seeks comment on the factors EPA should consider when
determining whether to require implementation of feasible options.
    EPA evaluated the NJDEP \125\ and CCHS \134\ IST analysis programs
as possible models to use in the Risk Management Program requirements.
EPA seeks comment on whether we should include the following in our
proposed STAA provisions:

     Aspects of the NJDEP's program, such as more prescribed
documentation of STAA; or
     Other aspects of CCHS's program, such as requiring ISS
analysis during the design of new processes, for PHA