 Economic Analysis of the Toxics Release Inventory (TRI) Reporting for Facilities Located in Indian Country Final Rule

                                 Prepared for:

                      Office of Environmental Information
                      US Environmental Protection Agency

                                 April 9, 2012

Table of Contents
Table of Contents	i
Table of Tables	iii
Executive Summary	iv
ES.1	Introduction	iv
ES.2	Need for Rule	iv
ES.3	Changes under the Final Rule	iv
ES.4	Estimated Reporting Activity	iv
ES.5	Costs of the Final Rule	v
ES.6	Small Entity Analysis	v
ES.7	Benefits of the Final Rule	vi
Chapter 1	 -  Introduction	1-1
1.1	Overview of TRI	1-1
1.1.1	Pollution Prevention Act	1-2
1.1.2	Changes to the List of Chemicals	1-3
1.1.3	Alternate Threshold	1-3
1.1.4	Executive Order 12856	1-3
1.1.5	Changes to the List of Industries	1-4
1.1.6	Changes for Certain PBT Chemicals	1-4
1.1.7	Toxic Chemical Release Reporting Using North American Industry Classification System (NAICS) Rule	1-4
1.1.8	TRI Dioxin and Dioxin-like Compounds Toxic Equivalency (TEQ) Information Rule- Final Rule	1-4
1.2	Description of Changes for Facilities Located in Indian Country	1-4
1.3	Organization of This Report	1-6
Chapter 2	 -  Estimated Number of Affected Facilities and Forms	2-1
Chapter 3	 -  Cost Estimates	3-1
3.1	Introduction	3-1
3.2	Methodology	3-1
3.3	Incremental Burden Estimates	3-2
3.3.1	Rule Familiarization	3-2
3.3.2	Compliance Determination	3-3
3.3.3	Summary	3-4
3.4	Unit Cost Estimates	3-4
3.5	Total Incremental Facility Costs	3-5
3.6	Total Incremental EPA Costs	3-6
Chapter 4	 -  Small Entity Impacts Associated with the Final Rule	4-1
4.1	Introduction	4-1
4.2	Definitions of Small Entities	4-1
4.3	Methodology Overview	4-2
4.4	Impacts on Small Businesses	4-4
4.4.1	Census Sectors	4-4
4.4.2	Utilities	4-7
4.5	Impacts on Small Government Jurisdictions	4-10
4.6	Summary	4-12
Chapter 5	 -  Benefits	5-1
Chapter 6	 -  Literature Cited	6-1

Table of Tables

Table ES-1:  Number of Forms Submitted to TRI from All Reporters (RY2010)	iv
Table ES-2:  Number of Facilities Submitting Forms to TRI in Indian Country (RY2009 and RY2010)	v
Table ES-3:  Estimated Incremental Costs Associated with the Final Rule	v
Table ES-4:  Estimated Impacts of the Final Rule on Small Parent Entities	vi
Table 2-1:  Number of Facilities Reporting to TRI in RY2010	2-1
Table 2-2:  Number of Facilities Submitting Forms to TRI in Indian Country (RY2009 and RY2010)	2-1
Table 2-3:  Tribal Lands Containing Facilities Reporting to TRI in RY2009 and/or RY2010	2-2
Table 3-1:  Estimated Rule Familiarization Burden per Facility Associated with the Final Rule	3-3
Table 3-2:  Estimated Compliance Determination Burden per Facility Associated with the Final Rule	3-4
Table 3-3:  Estimated First and Subsequent Year Burden Associated with the Final Rule	3-4
Table 3-4:  Loaded Hourly Wage Rates by Labor Category	3-5
Table 3-5:  Estimated Incremental Costs Associated with the Final Rule	3-5
Table 4-1:  Categorization of Sectors Affected by Final Rule	4-3
Table 4-2:  Sectors with Information in SUSB	4-4
Table 4-3:  Universe of Affected TRI Facilities in Sectors with Data in SUSB	4-5
Table 4-4:  Estimated Impacts of Final Rule on Small Parent Entities in Census Sectors	4-7
Table 4-5:  TRI Utility Universe	4-8
Table 4-6:  Estimated Impacts of Final Rule on Small Parent Entities in Utility Sectors	4-10
Table 4-7:  TRI Government Owned Facility Universe	4-10
Table 4-8:  Estimated Impacts of Final Rule on Small Government Jurisdictions	4-11
Table 4-9:  Estimated Impacts of Final Rule on Small Parent Entities	4-12

 Executive Summary
E.1  Introduction
Under section 313 of the Emergency Planning and Community Right-to-Know Act (EPCRA), and section 6607 of the Pollution Prevention Act (PPA), certain facilities are required to file annual reports to the United States Environmental Protection Agency (EPA) and to States on their releases, transfers, and other waste management practices for certain toxic chemicals if they are manufactured, processed, or otherwise used above certain threshold amounts. This information is included in a publicly available database known as the Toxics Release Inventory (TRI).
On July 26, 1990, EPA finalized regulations in the Federal Register (FR) which included requiring facilities in Indian country to submit annual TRI reports to EPA and the appropriate tribal government (55 FR 30632). These amendments, however, were inadvertently omitted from the Code of Federal Regulations (CFR) as the relevant provisions were later overwritten by a subsequent final rule, thus resulting in the exclusion of the intended requirement from the CFR. This report analyzes the economic impacts of a new final rule that reinstates the 1990 amendment which requires facilities in Indian country to submit annual TRI reports to EPA and the appropriate tribal government, rather than to the State.
E.2 Need for Rule
As mentioned above, amendments requiring facilities in Indian country to submit annual TRI reports to EPA and the appropriate tribal government were inadvertently omitted from the CFR. This rule corrects that omission and requires facilities located in Indian country to submit their annual TRI reports to the appropriate Tribe, rather than to the State in which the facility is geographically located. Further, through clarified request and petition rights, it encourages tribal engagement and participation in the TRI program, allowing Tribes to better understand potential sources of toxic chemicals, as well as to assess environmental and health conditions on their lands.
E.3 Changes under the Final Rule
Under the final rule, facilities that are located in Indian country are required to submit their annual TRI reports to the appropriate Tribe, rather than to the State in which the facility is geographically located. A Tribe's only responsibility is to receive TRI reports submitted by facilities located within its Indian country. Tribal governments are also able to request that EPA require that a specific facility or facilities located within the Tribe's Indian country report to TRI and petition for the addition (or deletion) of certain chemicals, as States are currently able to do.
E.4 Estimated Reporting Activity
The final rule is not intended to change the number of facilities reporting to TRI or the number of reports filed. As is shown in Table ES-1, in reporting year (RY) 2010, a total of 79,462 forms were reported to TRI by 20,904 facilities (U.S. EPA, 2012b).
Table ES-1:  Number of Forms Submitted to TRI from All Reporters (RY2010)

                                  Facilities
                                    Form Rs
                                    Form As
Total Number of Unique Forms/Facilities
                                                                         20,904
                                                                         70,393
                                                                          9,069

However, a subset of current reporters will need to determine whether or not they are located in Indian country. As shown in Table ES-2, 47 facilities located in Indian country submitted a total of 188 forms to TRI in RY2009 or RY2010. These facilities will be used as a proxy for the number of facilities who may need to determine whether they are located in Indian country.
Table ES-2:  Number of Facilities Submitting Forms to TRI in Indian Country (RY2009 and RY2010)

                                  Facilities
                                    Form Rs
                                    Form As
Total Number of Unique Forms/Facilities
                                                                             47
                                                                            170
                                                                             18

E.5 Costs of the Final Rule
 New tasks associated with the final rule are limited to compliance determination (for facilities unsure of their Indian country status) and rule familiarization (for all reporting facilities). Facilities affected by the final rule are already reporting to TRI. Baseline reporting burden already captures the burden to these facilities for form completion, recordkeeping and submission, and supplier notification. Therefore, the estimated total cost to industry of the final rule is $388,161. Costs of the rule occur in the first year only; there are no costs in subsequent years. Table ES-3 summarizes the total costs of the final rule.

Table ES-3:  Estimated Incremental Costs Associated with the Final Rule
                                   Activity
                           Hours Per Labor Category
                                Total Unit Cost
                             Number of Facilities
                                  Total Cost

                                  Managerial
                                   Technical
                                   Clerical

                                   $65.33/hr
                                   $52.27/hr
                                   $25.73/hr

                                  First-Year
Rule Familiarization
                                                                          0.083
                                                                          0.250
                                                                              0
                                                                         $18.51
                                                                         20,904
                                                                       $386,933
Compliance Determination
                                                                          0.000
                                                                          0.500
                                                                              0
                                                                         $26.13
                                                                             47
                                                                         $1,228
Annual Total

                                                                       $388,161
                               Subsequent-Years
Rule Familiarization
                                                                              0
                                                                              0
                                                                              0
                                                                             $0
                                                                              0
                                                                             $0
Compliance Determination
                                                                              0
                                                                              0
                                                                              0
                                                                             $0
                                                                              0
                                                                             $0
Annual Total

                                                                             $0

E2.1 Small Entity Analysis
The Regulatory Flexibility Act (RFA) of 1980 (5 U.S.C. § 601 et. seq.) requires Federal agencies to assess the effects of regulations on small entities, and in some instances, to examine alternatives to the regulations that may reduce adverse economic effects on significantly impacted small entities. The RFA requires agencies to prepare an initial and final regulatory flexibility analysis for each rule unless the Agency certifies that the rule would not have a significant economic impact on a substantial number of small entities.
This analysis uses annual cost impact percentages to measure potential impacts on small entities. The cost impact percentage is defined as annual compliance costs resulting from the final rule as a percentage of annual revenues or sales. For purposes of determining small entity impacts, comparing annual compliance costs to annual revenues provides a reasonable indication of the magnitude of the regulatory burden relative to a commonly available and objective measure of a company's business volume. Where regulatory costs represent a small fraction of a typical firm's revenue, the impacts of the regulation are likely to be minimal.
The compliance cost associated with the final rule in the first year consists of the costs of rule familiarization and compliance determination; there are no costs in subsequent years. EPA estimated small entity impacts for small businesses in sectors for which information is available from the 2007 U.S. Census Statistics of U.S. Businesses (SUSB) and utility sectors; as well as for small government jurisdictions. Of these sectors, no small entities are estimated to incur a cost impact of one percent or greater associated with the compliance costs resulting from the final rule, as is shown in Table ES-4 below. The median impact incurred by any small parent entity is 0.003 percent, which is incurred by small parent entities in NAICS 321219, Reconstituted Wood Product Manufacturing. The maximum impact incurred by any small parent entity is 0.713 percent, which is incurred by small parent entities in NAICS 221320, Sewage Treatment Facilities.
Table ES-4:  Estimated Impacts of the Final Rule on Small Parent Entities
                        Category of Sector Description
                                Cost Impact of
                                    <1%
                             Cost Impact Between
                                   1% and 3%
                             Cost Impact of >3%

                                       #
                                       %
                                       #
                                       %
                                       #
                                       %
# Small parent entities
                                     3,310
                                      100
                                       0
                                       0
                                       0
                                       0

E2.2 Benefits of the Final Rule
EPA believes that the final rule further encourages tribal engagement and participation in the TRI program. Tribes have the opportunity to request that EPA require that a specific facility or facilities located within the Tribe's Indian country to report to TRI. Under the final rule, Tribes are also able to petition for the addition or deletion of certain chemicals, which applies to all facilities releasing the particular substance(s). These types of provisions already apply in the context of requests/petitions by Governors of States. By increasing the participation and engagement of Tribal governments in the TRI program, EPA is helping to increase awareness of toxic releases within these communities, thereby increasing the understanding of potential human health impacts from these hazardous chemicals.

 -  Introduction
The Emergency Planning and Community Right-to-Know Act (EPCRA), also known as Title III of the Superfund Amendments and Reauthorization Act of 1986 (SARA), created a broad range of emergency response planning and reporting requirements for manufacturers, processors, and users of toxic chemicals in the United States (42 U.S.C. §§ 11001-11050). Under section 313 of EPCRA, certain facilities are required to submit annual reports to the United States Environmental Protection Agency (EPA) and to States on their release, transfer, and waste management activities of certain toxic chemicals if they are manufactured, processed, or otherwise used above certain threshold amounts. In addition, the Pollution Prevention Act (PPA) of 1990 requires these same facilities to report pollution prevention, recycling, and other waste management information for these same chemicals. EPA maintains the data collected under EPCRA section 313 and the PPA in a database known as the Toxics Release Inventory (TRI).
Since the program began in 1986, facilities that meet TRI reporting requirements have been required to submit annual TRI reports to EPA and the State in which they are located. On July 26, 1990, EPA finalized regulations in the Federal Register (FR), which included requiring facilities in Indian country to submit annual TRI reports to EPA and the appropriate tribal government (55 FR 30632). These amendments, however, were inadvertently omitted from the Code of Federal Regulations (CFR) and the relevant provisions were later overwritten by a subsequent final rule, thus resulting in the exclusion of the intended requirement from the CFR.
This report analyzes the economic impacts of a final rule that requires facilities that are located in Indian country to submit their annual TRI reports to the appropriate Tribe, rather than to the State in which the facility is geographically located. To understand the effects of the final rule, however, it is first necessary to understand how EPCRA section 313 and TRI currently operate. This chapter provides an overview of TRI followed by a description of the rule and organization of the report.
        Overview of TRI
In 1986, Congress passed the Emergency Planning and Community Right-to-Know Act (EPCRA). The law was passed in response to the accidental release of methyl isocyanate gas in Bhopal, India, in December 1984, and to a number of chemical accidents in the United States, including one in Institute, West Virginia. These accidental releases highlighted the lack of information readily available to the public about toxic chemicals being manufactured, processed, used, and transported within their communities. EPCRA is based on the premise that the public has the right to know about the use of chemicals, as well as their routine and accidental releases. The broad purposes are to encourage planning for response to accidental chemical releases as well as daily management of routine releases, and to provide the public and government agencies with information about the presence, release, and management of toxic chemicals.
EPCRA contains four main provisions:
Planning for chemical emergencies (sections 301-303);
Emergency notification of chemical accidents and releases (section 304);
Reporting of hazardous chemical inventories (sections 311-312); and,
Toxic chemical release reporting (section 313).

Because this rule falls under section 313 (and not the other sections of EPCRA), the remainder of this overview deals only with the TRI provisions of section 313.
The first regulations implementing EPCRA section 313 were promulgated on February 16, 1988 (53 FR 4500), and are codified at 40 CFR part 372. Under these original regulations, owners or operators of regulated facilities must complete the Toxic Chemical Release Inventory Reporting Form R, which includes information on releases to air, water, and land, as well as on-site waste treatment and transfers of the chemical to off-site locations.
A facility must report under section 313 if it meets all of the following three criteria:
   1. It is in an Industrial Classification code covered by the regulations;
   2. It has ten or more full-time employees (or the hourly equivalent of 20,000 hours); and,
   3. It manufactures, processes, or otherwise uses any of the listed toxic chemicals or chemical categories above the applicable reporting threshold.
Facilities must submit the forms each calendar year to both EPA and the State in which the facility is located by July 1 of the following year.
A completed Form R must be submitted for each toxic chemical manufactured, processed, or otherwise used over threshold levels at each regulated facility as described in 40 CFR part 372. For most chemicals, threshold levels are set at 25,000 pounds for manufacturing and processing and 10,000 pounds for otherwise use (40 CFR § 372.25). Over 600 toxic chemicals and chemical compound categories are currently on the list of TRI chemicals.
TRI is unique among environmental databases because of the multimedia data it collects, and because it was designed for public access. EPCRA requires that EPA "establish and maintain in a computer database a national toxic chemical inventory based on data submitted to the Administrator" (42 U.S.C. § 11023(j)). EPA maintains the section 313 data in the national TRI database and makes the data available to the public in a variety of electronic formats. With its broad dissemination, TRI data is used extensively by the public. Facilities use the data obtained through TRI to better understand their operations, and make better use of pollution prevention opportunities. Public interest groups use the data to inform themselves about the presence of toxic chemicals in the environment, and use that knowledge to engage in a meaningful, productive dialogue with industry and all levels of government. In general, TRI data have proven to be a powerful tool in environmental decision-making.
   .3.1 Pollution Prevention Act
In 1990, Congress passed the Pollution Prevention Act (PPA), which adopted as national policy an environmental hierarchy that establishes pollution prevention as the first choice among waste management options (42 U.S.C. §§ 13101-13109). For waste that cannot be prevented at the source, recycling is considered the next best option, and treatment or disposal should be considered only after source reduction and recycling options have been eliminated. Section 6607 of the PPA requires facilities to also report information on their pollution prevention, recycling, and other waste management activities. This information complements the information reported under EPCRA section 313 by providing information about the waste management activities related to the reported chemicals. The data elements required by the Pollution Prevention Act are included as Section 8 of Form R.
   .3.2 Changes to the List of Chemicals
When Congress passed EPCRA it provided an initial list of approximately 300 chemicals and chemical categories subject to TRI reporting. The statutory list was derived from chemical lists used in New Jersey and Maryland. Congress also included a provision in EPCRA that allows EPA to amend the list of chemicals subject to TRI reporting. Under section 313(d), EPA has the authority to add a chemical to the list if it determines that the chemical can cause or can be reasonably anticipated to cause:
Adverse acute human health effects at concentration levels reasonably likely to exist beyond facility site boundaries as a result of continuous or frequently recurring releases;
In humans, cancer or teratogenic effects, serious or irreversible reproductive dysfunctions, neurological disorders, heritable genetic mutations, or other chronic health effects; or,
A significant adverse effect on the environment. See, 42 U.S.C. § 11023(d).

EPA has added chemicals to the list through its authority under section 313(d). Most notably, EPA added 286 chemicals and chemical categories to the list of toxic chemicals subject to TRI on November 30, 1994 (59 FR 61432). The majority of these chemicals are pesticides. Many of the remaining chemicals are either regulated or identified as concerns under other environmental statutes such as the Clean Air Act, the Clean Water Act, and the Safe Drinking Water Act.
EPA may delete a chemical from the list if it does not meet any of the above criteria found in 313(d). According to section 313(e) of EPCRA, any person may petition EPA to add or delete a chemical from the list on the basis of whether or not it meets the above criteria (see 42 U.S.C. § 11023(e)). All changes to the list are made through the rulemaking process under the Administrative Procedures Act (APA).
   1.1.1 Alternate Threshold
On November 30, 1994, EPA finalized the "TRI Alternate Threshold for Facilities with Low Annual Reportable Amounts" rule (59 FR 61488). This rule was intended to reduce the compliance burden associated with EPCRA section 313. It established a streamlined reporting option for facilities where the annual reportable amount of a listed chemical released or managed does not exceed 500 pounds. Such facilities have the option of applying an alternate manufacture, process, or otherwise use threshold of 1 million pounds to that chemical, instead of the standard thresholds of 10,000 or 25,000 pounds. If a facility does not exceed the 1 million-pound threshold, then that facility is eligible to submit Form A for that chemical instead of Form R. Form A is a simplified reporting form that includes facility identification information and identifies the chemical or chemical category being reported. The form must be submitted on an annual basis.
   2.1.2 Executive Order 12856
On August 3, 1993, Executive Order 12856, "Federal Compliance with Right-to-Know Laws and Pollution Prevention Requirements" was signed by the President (58 FR 41981). The Executive Order requires federal facilities to comply with EPCRA requirements beginning with the 1994-reporting year. The Executive Order also asked all federal agencies to set a voluntary goal of 50% reduction from baseline quantities of their releases and transfers by 1999.
   3.1.3 Changes to the List of Industries
On May 1, 1997, EPA added facilities in seven industry groups to the list of facilities subject to the reporting requirements of section 313 (62 FR 23833). The first reports from these facilities were required to be submitted in 1999 for reporting year 1998. Prior to this action, reporting was limited to facilities in the manufacturing sector and federal facilities. This action added facilities in the following sectors:
Metal mining,
Coal mining,
Electric utilities,
Commercial hazardous waste treatment, storage, and disposal facilities,
Chemicals and allied products-wholesale,
Petroleum bulk terminals and plants-wholesale, and
Solvent recovery services.

   1.2.1 Changes for Certain PBT Chemicals
On October 29, 1999, EPA lowered reporting thresholds to 10 or 100 pounds for certain TRI chemicals (persistent, bioaccumulative and toxic chemicals, or PBT chemicals) that are of concern because of their toxicity and tendency to persist and bioaccumulate (64 FR 58666). EPA also added to TRI certain PBT chemicals that were not already listed including a dioxin and dioxin-like compounds category with a reporting threshold of 0.1 gram. At this time EPA made other changes to PBT chemical reporting, such as disallowing the use of the de minimis exemption, range reporting, and Form A reporting for PBT chemicals (40 CFR § 372.28(b)). On January 17, 2001, EPA lowered the reporting threshold for lead and lead compounds to 100 pounds and applied the same limitations as are applied to other PBT chemicals (40 CFR § 372.28).
   2.2.2       Toxic Chemical Release Reporting Using North American Industry Classification System (NAICS) Rule
On June 6, 2006, EPA published a final rule requiring facilities reporting to TRI to use North American Industry Classification System (NAICS) codes in place of the Standard Industry Classification (SIC) codes previously used on TRI reporting forms. This rule required facilities that report to TRI to use 2002 NAICS codes on reporting Form R and the Form A Certification Statement. The 2007 NAICS Revision Final Rule published on June 9, 2008, required facilities to use 2007 NAICS codes on TRI reporting forms.
   3.2.3       TRI Dioxin and Dioxin-like Compounds Toxic Equivalency (TEQ) Information Rule- Final Rule
On May 10, 2007, the Toxics Release Inventory Program issued a final rule expanding reporting requirements for the dioxin and dioxin-like compounds category. There are seventeen distinct members of this chemical category that are included on the EPCRA section 313 list of toxic chemicals. The final rule requires that, in addition to the total grams released for the entire category, facilities must report the quantity for each individual member on a new Form R Schedule 1. EPA uses the individual mass quantity data to calculate TEQ values that are made available to the public along with the mass data. The final rule also removes the requirement to report the single distribution of compounds in the category.
Description of Changes for Facilities Located in Indian Country
On July 26, 1990, EPA finalized regulations in the Federal Register (FR) requiring facilities in Indian country to submit annual TRI reports to EPA and the appropriate tribal government (55 FR 30632). These amendments, however, were inadvertently omitted from the Code of Federal Regulations (CFR) and the relevant provisions were later overwritten by a subsequent final rule, thus resulting in the exclusion of the intended requirement from the CFR.
EPA is including these provisions in 40 CFR Section 372.30(a), thus requiring facilities that are located in Indian country to submit their annual TRI reports to the appropriate Tribe, rather than to the State in which the facility is geographically located. Given this action, 40 CFR part 372.30(a) needs to be revised to clarify that for facilities located in Indian country, EPA's Form R, Form A, and Form R Schedule 1 must be submitted to the official designated by the tribal Chairperson or equivalent elected official, as well as to EPA. For the purpose of clarity, EPA also amends the definition of "State" to no longer include Indian country.
Form R and Form A will be modified to reflect these changes in reporting requirements. On the first page of Form R and Form A, under the section "WHERE TO SEND COMPLETED FORMS", the current text "2. APPROPRIATE STATE OFFICE" will be replaced with "2. APPROPRIATE STATE OR TRIBAL OFFICE." A list of contacts for the appropriate tribal government will be included in the TRI Reporting Forms and Instructions.

The final rule also provides Tribes with the opportunity to request that EPA require that a specific facility or facilities located within the Tribe's Indian country report to TRI. Additionally, they will be able to petition for the addition of certain chemicals, which will apply to all facilities releasing the particular substance(s). The statute  -  at sections 313(b)(2) and 313(d)  -  expressly authorizes the Administrator to apply TRI reporting requirements to particular facilities and to add or delete chemicals to or from the list of chemicals subject to TRI reporting. Further, the statute provides opportunities for Governors of States to request that particular facilities within the States be subject to TRI reporting or that specific chemicals be added to or deleted from the TRI reporting list (EPCRA Section 313(b)(2), (e)(2)). EPA believes that these same opportunities are appropriately available to tribal governments under the statute and has finalized this rule to explicitly describe these provisions so that it is apparent that the tribal Chairperson or equivalent elected official may make similar requests to EPA. Ultimately, however, it is EPA that determines whether TRI reporting requirements will apply to a particular facility or whether a specific chemical will be added to, or deleted from, the TRI chemical list.

Under the final rule and per the intent of the 1990 regulation, a Tribe's only responsibility is to receive TRI reports submitted by facilities located within its Indian country. EPA will ask affected Tribes (those with facilities located in their Indian country) to identify a point of contact to whom facilities can provide their annual report of TRI releases. If no TRI contact is designated, the head representative of the Tribal Council or Tribal Environmental Department will serve as the point of contact for report submission.
Although Tribes are not required to use the toxics release data received from facilities for any particular purpose, TRI data are among the many tools available to help Tribes better understand potential sources of toxic chemicals, as well as to assess environmental and health conditions on their lands. Tribes currently have and will continue to have access to TRI data across the entire nation, once it is made available to the public. The final rule simply accelerates the timeframe within which a Tribe will receive data from facilities in its Indian country.
Under EPA's approach, if the facility is located in the Indian country of a Tribe that becomes a member of the internet-based TRI Data Exchange, then the owner or operator of that facility could meet its dual EPA/tribal reporting requirements by submitting its TRI report to EPA via TRI Made Easy (TRI-ME) web, a web-based application that allows facilities to submit a paperless report. EPA will then automatically transmit the report to the appropriate Tribe via the TRI State Data Exchange. If the facility is located in the Indian country of a Tribe that does not become a member of the TRI Data Exchange, or if the facility is allowed to submit to the Tribe via paper form, then the facility will be required to submit a TRI report to EPA (either electronically or via paper) and also separately to the appropriate Tribe. The approach described above is the same as for EPA and States when facilities are not located in Indian country.
Organization of This Report
This report estimates the costs to industry and impact on potentially affected small entities associated with the changes for facilities located in Indian country. The remainder of this report is organized as follows:
   * Chapter 2 summarizes the universe of facilities potentially affected by the final rule;
   * Chapter 3 presents the methodology used to estimate the burden and costs to industry, as well as the results of the analysis in terms of total cost to industry;
   * Chapter 4 examines the impacts of the final rule on "small" entities; and,
   * Chapter 5 evaluates the benefits of the final rule.

 -  Estimated Number of Affected Facilities and Forms
The final rule creates reporting burden for all TRI reporters to familiarize themselves with the clarified language regarding where forms should be submitted. This rule does not change the total number of facilities reporting to TRI nor the number of reports (Form R or Form A) filed. The total number of TRI reporters in RY2010 is presented in Table 2-1.

Table 2-1:  Number of Facilities Reporting to TRI in RY2010

                                  Facilities
                                    Form Rs
                                    Form As
Total Unique Number of Forms/Facilities
                                                                         20,904
                                                                         70,393
                                                                          9,069
U.S. EPA. 2012b. TRI RY2010: NA2010. Accessed via TRI.NET

Additionally, a subset of current reporters will need to determine whether or not they are located in Indian country. Herein, "Indian Tribe" refers to a Tribe that is "Federally-recognized'" by the Secretary of the Interior under 25 CFR 272.2, while "Indian country" refers to lands under the Title 18 U.S.C. § 1151 definition of Indian country as:
      a) all land within the limits of any Indian reservation under the jurisdiction of the United States Government, notwithstanding the issuance of any patent, and, including rights-of-way running through the reservation;
      b) all dependent Indian communities within the borders of the United States whether within the original or subsequently acquired territory thereof, and whether within or without the limits of a State; and
      c) all Indian allotments, the Indian titles to which have not been extinguished, including rights-of-way running through the same.
As shown in Table 2-2, 47 facilities located in Indian country submitted a total of 188 forms to TRI in RY2009 or RY2010.[,] These facilities are used as a proxy for estimating the number of facilities performing compliance determination (see Section 3.3.2).
Table 2-2:  Number of Facilities Submitting Forms to TRI in Indian Country (RY2009 and RY2010)

                                  Facilities
                                    Form Rs
                                    Form As
Total Unique Number of Forms/Facilities
                                                                             47
                                                                            170
                                                                             18
U.S. EPA. 2012b. TRI RY2009, RY2010: NA2010. Accessed via TRI.NET

These 47 facilities were located in 17 distinct tribal lands, listed below in Table 2-3.
Table 2-3:  Tribal Lands Containing Facilities Reporting to TRI in RY2009 and/or RY2010
                                  Reservation
                                   State(s)
Coeur d'Alene Reservation
Idaho
Colorado River Reservation
Arizona
Gila River Reservation
Arizona
Isabella Reservation
Michigan
Lake Traverse Reservation
South Dakota
Morongo Reservation
California
Navajo Nation Reservation
Arizona, New Mexico
Nez Perce Reservation
Idaho
Omaha Reservation
Nebraska
Oneida Reservation
Wisconsin
Puyallup Reservation
Washington
Rincon Reservation
California
San Xavier Reservation
Arizona
Tulalip Reservation
Washington
Uintah and Ouray Reservation
Utah
Wind River Reservation
Wyoming
Yakama Reservation
Washington
U.S. EPA. 2012b. TRI RY2009, RY2010: NA2010. Accessed via TRI.NET

 -  Cost Estimates
Introduction
This chapter presents the estimated industry costs associated with the final rule, which clarifies where facilities in Indian country should send their TRI forms. Specifically, facilities that are located in Indian country must submit their annual TRI reports to the appropriate tribal government, rather than to the State in which the facility is geographically located. The requirement for the facility to report to EPA remains the same. Incremental reporting burden and cost will be associated with the need for all facilities to familiarize themselves with the clarified requirements as well as the need for certain facilities to determine whether or not they are located in Indian country.
Section 3.2 describes the methodology used to estimate industry costs. Section 3.3 provides estimates of the incremental burden while Section 3.4 explains how the cost estimates, or unit costs, were developed. Section 3.5 summarizes the total estimated incremental costs of the final rule for the reporting community. Section 3.6 estimates the incremental costs of the final rule for EPA.
Methodology
Industry burden and costs associated with the final rule were calculated using the following four-step procedure:
       Step 1:	Identify and describe the new tasks that facilities will perform to comply with the final rule.

       Step 2:	Estimate the typical number of hours of managerial, technical, and clerical labor needed to complete each new task. Based on typical labor rates, calculate the unit cost of each new task for the first year of compliance and for subsequent years.

       Step 3:	Estimate the number of unique facilities that will perform each new task.

       Step 4:	For each new task, multiply the unit cost by the number of unique facilities and then sum the results to estimate the total incremental industry costs for the first year and subsequent years.

The set of compliance activities associated with TRI reporting include:
Compliance Determination: Facility staff must determine whether the facility meets the criteria for EPCRA section 313 reporting. This activity includes the time required to become familiar with the definitions, exemptions, and threshold requirements under the TRI Program, to review the list of TRI chemicals, and to conduct preliminary threshold determinations to determine if the facility is required to report.
Rule Familiarization: Facilities must read the reporting package and become familiar with the revised language concerning reporting requirements.
Report Completion: Facilities must gather data and perform calculations to provide the information required on Reporting Form R or Reporting Form A. This activity includes the time required to search data sources and the time to complete and review the information.
Recordkeeping and Submission: Facilities must maintain recordkeeping systems and submit their reports to EPA and the State or Tribe in which the facility is located. This activity includes the time required to transmit or otherwise disclose the information.
Supplier Notification: Certain suppliers of mixtures or trade name products containing reportable substances must annually notify their customers of the product's composition, if the customer is subject to EPCRA section 313 reporting. This activity includes the time required to inform customers, either by letter or through the materials safety data sheet (MSDS) for the product.
The new tasks associated with the final rule are limited to compliance determination (for facilities unsure of their tribal land status) and rule familiarization (for all reporting facilities). Facilities affected by the final rule are already reporting to TRI. Baseline reporting burden therefore already captures the burden to these facilities for form completion, recordkeeping and submission, and supplier notification.
The skills required to comply with the EPCRA section 313 reporting requirements (including the requirements associated with section 6607 of the PPA) are expected to vary from facility to facility, depending upon factors such as: the complexity of the facility's processes and activities; the chemicals at the facility; and the types of use and disposition of TRI chemicals at the facility. Individuals responsible for determining whether their facility is required to report and, if so, completing a Form R or A report (or multiple Form R and/or A reports) will often have an engineering, scientific, or technical background. These functions, however, do not require an engineering or other similar degree.
At a minimum, an understanding of the facility's chemical purchases and production processes are needed. Necessary skills may include the ability to evaluate and interpret records, understand material safety data sheets, and determine throughput or production volumes. Depending on the facility, estimates may be calculated using: (1) existing data collected under federal, state, or local regulations; (2) emissions factors; (3) design data supplied by the equipment manufacturer; (4) mass balance techniques; or (5) engineering calculations. Each technique requires varying skills and levels of sophistication to complete. EPA industry- and chemical-specific guidance documents will assist reporters in making the necessary calculations to comply with the section 313 reporting requirements. In addition to technical labor, requirements involving managerial and clerical staff are also considered when computing costs.
Incremental Burden Estimates
In this section, EPA estimates the incremental burden associated with the final rule. Since the final rule simply clarifies where facilities located in Indian country should send their forms, TRI reporters are only expected to incur burden due to rule familiarization and compliance determination.
The following burden estimates are based on considerable experience with the TRI program and engineering judgment.
      Rule Familiarization
Under the final rule, EPA expects that the entire TRI reporting community -- 20,904 facilities reporting to TRI in RY2010 -- may incur rule familiarization burden. The incremental burden estimates associated with rule familiarization consist of time to read and interpret the clarified language outlined in the final rule and are based on the following assumptions:
The first-year technical burden includes ten minutes per facility to read and interpret the clarified language. An additional five minutes per facility will be required to brief management regarding the clarified language. It is assumed that facilities will fully comprehend the clarified language by the subsequent year of reporting; therefore, no rule familiarization burden is required in subsequent years.

The first-year management burden includes five minutes per facility to be briefed regarding the clarified language. It is assumed that facilities will fully comprehend the clarified language by the subsequent year of reporting; therefore, no rule familiarization burden is required in subsequent years.

There is no first- or subsequent-year burden on clerical staff associated with rule familiarization.

The incremental burden associated with rule familiarization in the first and subsequent years is presented in Table 3-1.
Table 3-1:  Estimated Rule Familiarization Burden per Facility Associated with the Final Rule
Labor Category
First Year Burden (minutes)
Subsequent Year Burden (minutes)
Management
                                       5
                                       0
Technical
                                      15
                                       0
Clerical
                                       0
                                       0

      Compliance Determination
Under the final rule, EPA assumes that most TRI reporters know whether or not they are located in Indian country. A subset of facilities, however, will spend time determining whether or not their facility resides on Indian country. While the number of facilities that will have to make this determination is not known, it is expected to be a small subset of TRI reporters. Therefore, the 47 facilities identified as located in Indian country in RY2009 and RY2010 are used as a proxy for the number of facilities expected to perform this compliance determination task. In the proposed Economic Analysis, EPA estimated that facilities would require 10 minutes, on average, to make this determination. EPA based the 10 minute estimate on the assumption that most facilities are already aware of their geographic status relating to Indian country. Those that are not would make one call EPA to obtain this information. During the public comment period for the proposed rule, EPA received feedback that in certain situations 10 minutes may not be sufficient to make this determination. Upon further review, and taking into account the potential need for multiple communications with the Agency, EPA has increased the average time (for all 47 potentially affected facilities) for a facility to make this determination, including consulting with EPA as appropriate, to a conservative 30 minutes.
   * The first-year technical burden includes thirty minutes to identify facility status in Indian country. It is assumed that technical staff will obtain this information by calling EPA to inquire. It is further assumed that facilities will fully comprehend their status prior to the subsequent-year of reporting; therefore, no compliance determination burden is required in subsequent-years.
There is no first- or subsequent-year burden on managerial staff associated with compliance determination.

There is no first- or subsequent-year burden on clerical staff associated with compliance determination.

The incremental burden associated with compliance determination in the first- and subsequent-years is presented in Table 3-2.
Table 3-2:  Estimated Compliance Determination Burden per Facility Associated with the Final Rule
                                Labor Category
                          First-Year Burden (minutes)
                       Subsequent-Year Burden (minutes)

Management
                                       0
                                       0
Technical
                                      30
                                       0
Clerical
                                       0
                                       0

      Summary
Table 3-3 presents total first- and subsequent-year incremental burden estimates associated with the final rule.
Table 3-3:  Estimated First and Subsequent Year Burden Associated with the Final Rule
                                   Activity
                             Number of Facilities
                                Labor Category
                               Total Unit Burden
                                 Total Burden

                                  Managerial
                                   Technical
                                   Clerical

                     Incremental First-Year Burden (hours)
Rule Familiarization
                                                                         20,904
                                                                          0.083
                                                                          0.250
                                                                              0
                                                                          0.333
                                                                          6,961
Compliance Determination
                                                                             47
                                                                          0.000
                                                                          0.500
                                                                              0
                                                                          0.500
                                                                             24
Total

                                                                          6,985
                  Incremental Subsequent-Year Burden (hours)
Rule Familiarization
                                                                              0
                                                                              0
                                                                              0
                                                                              0
                                                                              0
                                                                              0
Compliance Determination
                                                                              0
                                                                              0
                                                                              0
                                                                              0
                                                                              0
                                                                              0
Total

                                                                              0
                                                                              0

Unit Cost Estimates
This section explains how the cost estimates, or unit costs, were developed for the final rule. Each cost estimate is made up of two components: the unit time estimates (i.e., number of labor hours required of each type of personnel to complete a task) and the hourly wage rates for each level of personnel.
Labor rates are divided into three categories: managerial, technical, and clerical. These rates reflect the total cost to employ an individual. They include the cost of salaries, fringe benefits, such as paid leave, health insurance, retirement savings, legally required benefits, and other overhead costs, such as office space, furniture, equipment and computers, supplies and other business expenses. Updated 2011 hourly labor rates, including fringe benefits and overhead, were calculated using current data on salaries and benefits for these three labor categories from information published by the Bureau of Labor Statistics (BLS) (U.S. DOL, 2011). The general methodology for this calculation was obtained from Wage Rates for Economic Analysis of the Toxics Release Inventory Program (Rice, 2002). The managerial, technical, and clerical wage rates are composites of the BLS rates for `Wages and Salaries' and `Total Benefits' by labor category. The sum of `Wages and Salaries' and `Total Benefits' is equal to `Total Compensation.' The managerial labor rate is defined as the average hourly wages and salaries for the "Management, Business, and Financial" occupational category. The technical labor rate is defined as the average hourly wages and salaries for the "Professional and Related" occupational category. The clerical labor rate is defined as the average hourly wages and salaries for the "Office and Administrative Support" occupational category.
Based on information provided by the chemical industry and chemical industry trade associations, an additional loading factor of 17 percent is applied to `Wages and Salaries' for general overhead. The sum of `Total Compensation' and `Overhead' is equal to `Total Loaded Hourly Wage Rate'. As shown in Table 3-4, the hourly wage rates are $65.33 for managerial personnel, $52.27 for technical personnel, and $25.73 for clerical personnel, all in 2011 dollars.
Table 3-4:  Loaded Hourly Wage Rates by Labor Category
Wage Type
Labor Category

Managerial
Technical
Clerical
Wages and Salaries (Sep. 2011)
                                                                         $40.55
                                                                         $33.27
                                                                         $16.00
Total Benefits
                                                                         $17.89
                                                                         $13.34
                                                                          $7.01
Overhead
                                                                          $6.89
                                                                          $5.66
                                                                          $2.72
Total Loaded Hourly Rate
                                                                         $65.33
                                                                         $52.27
                                                                         $25.73
U.S.DOL. 2011. Employer Costs for Employee Compensation  -  September 2011. U.S. Department of Labor. Bureau of Labor Statistics. Washington D.C., December 7, 2011.

Total Incremental Facility Costs
Table 3-5 summarizes the total estimated incremental costs of the rule. For the 47 facilities expected to have both compliance determination and rule familiarization burden due to the final rule, the total first-year incremental costs are $44.64 per facility. For the remaining 20,857 facilities in the TRI reporting community expected to have only rule familiarization burden due to the final rule, the total first-year incremental costs are $18.51 per facility. In total for the entire TRI reporting community, the total first-year incremental costs are $388,161. There are no subsequent-year costs.
Table 3-5:  Estimated Incremental Costs Associated with the Final Rule
                                   Activity
                           Hours Per Labor Category
                                Total Unit Cost
                             Number of Facilities
                                  Total Cost

                                  Managerial
                                   Technical
                                   Clerical

                                   $65.33/hr
                                   $52.27/hr
                                   $25.73/hr

                                  First-Year
Rule Familiarization
                                                                          0.083
                                                                          0.250
                                                                              0
                                                                         $18.51
                                                                         20,904
                                                                       $386,933
Compliance Determination
                                                                          0.000
                                                                          0.500
                                                                              0
                                                                         $26.13
                                                                             47
                                                                         $1,228
Annual Total

                                                                       $388,161
                               Subsequent-Years
Rule Familiarization
                                                                              0
                                                                              0
                                                                              0
                                                                             $0
                                                                              0
                                                                             $0
Compliance Determination
                                                                              0
                                                                              0
                                                                              0
                                                                             $0
                                                                              0
                                                                             $0
Annual Total

                                                                             $0

Total Incremental EPA Costs
While rule makings often create Agency burden and cost associated with the need to process additional forms or data elements, this rulemaking simply clarifies where reports should be sent. Therefore, EPA will not be required to perform additional processing of forms due to the final rule.

 -  Small Entity Impacts Associated with the Final Rule
Introduction
The Regulatory Flexibility Act (RFA) of 1980 (5 U.S.C. § 601 et. seq.) requires Federal agencies to assess the effects of regulations on small entities, and, in some instances, to examine alternatives to the regulations that may reduce adverse economic effects on significantly impacted small entities. The RFA requires agencies to prepare an initial and final regulatory flexibility analysis for each rule unless the Agency certifies that the rule will not have a significant economic impact on a substantial number of small entities.
Since 1980, the RFA has required Federal agencies to assess the economic impacts of their actions on small entities, including businesses, nonprofit agencies, and governments. Section 604 of the RFA, as amended by the Small Business Regulatory Enforcement Fairness Act (SBREFA) of 1996, requires an agency to perform a regulatory flexibility analysis for a rule unless the Agency certifies under section 605(b) that the regulatory action will not have a significant economic impact on a substantial number of small entities. The RFA does not specifically define "a significant economic impact on a substantial number" of small entities.
This chapter summarizes the results of a small entity impact analysis for the final rule. Specifically, Section 4.2 provides the definitions of small entities for the groups covered under the final rule. Section 4.3 describes the general methodology used to determine if the final rule results in significant economic impacts to a substantial number of small entities. In Sections 4.4 and 4.5 this methodology is used to estimate the impacts of the final rule on small businesses and small government jurisdictions, respectively. The results of the small entity analysis are summarized in Section 4.6.
Definitions of Small Entities
The RFA uses the definition of "small business" found in the Small Business Act, which authorizes the Small Business Administration (SBA) to define "small business" by regulation. This analysis uses the SBA's definition of a small business for each industry.
SBA's small business size standards vary by industry. In establishing size standards, SBA considers a number of economic and market characteristics that may allow a business concern to exercise dominance in an industry. Size standards are based on criteria, such as annual receipts or number of employees that represent a measure of these characteristics. These standards represent the largest size that a for-profit enterprise (together with its affiliates) may be and still qualify as a small business.
The SBA small business size standards are expansive, classifying most businesses as "small." For example, the default SBA size standard for manufacturing industries is 500 employees. According to information compiled for SBA by the Bureau of the Census, 282,622 of 286,701 manufacturing firms have fewer than 500 employees (U.S. SBA, 2010). Therefore, at least 98.6 percent of firms would be classified as small businesses according to the SBA definition. In fact, this percentage is actually higher, since for certain industrial classification codes within manufacturing, the SBA size standard is 750, 1,000, or 1,500 employees. The small business definitions relevant to this final rule are:
   * Businesses, where the small business definition is based on annual receipts or number of employees;
   * Utilities, where the small business definition is based on annual electricity generation;
   * Government jurisdictions, where the small definition is based on population; and,
   * Small organizations, where the small business definition is based on any not-for-profit enterprise which is independently owned and operated and is not dominant in its field.

Collectively, this analysis refers to small businesses, small governmental jurisdictions, and small organizations as small entities.
Methodology Overview
As mentioned above, the RFA considers whether a rule will have a significant economic impact on a substantial number of small entities. This analysis uses annual cost impact percentages to measure potential impacts on small entities. The cost impact percentage is defined as annual compliance costs resulting from the final rule as a percentage of annual revenue or sales. For purposes of determining small entity impacts, comparing annual compliance costs to annual revenue provides a reasonable indication of the magnitude of the regulatory burden relative to a commonly available and objective measure of a company's business volume. Where regulatory costs represent a small fraction of a typical firm's revenue (i.e., less than one percent), the impacts of the regulation are likely to be minimal.
The compliance cost associated with the final rule in the first year includes the costs of rule familiarization and compliance determination (see Table 3-5). There are no costs in subsequent years. In Chapter 2, it was estimated that all TRI reporters will incur the costs of rule familiarization, $18.51 per facility, and 47 facilities will also incur the costs of compliance determination at $26.13 per facility. Given the inability to specifically identify which facilities will undertake compliance determination, the cost impact ratios for all parent entities are conservatively calculated using the higher incremental compliance cost associated with completing both rule familiarization and compliance determination, totaling $44.64 per facility.
The final rule affects hundreds of industry sectors (i.e., NAICS codes). This small entity analysis considers facilities in all of the industry sectors which reported to TRI in RY2010. In RY2010, facilities in a total of 532 industry sectors reported to TRI (U.S. EPA, 2012b). It should be noted that industry information is only available at the facility-level; the information reported to TRI does not indicate the NAICS code of the parent company. For this reason, this analysis assumes that the NAICS code reported by each TRI facility in RY2010 is also the NAICS code of its parent.
Employment and revenue data (necessary for the small entity analysis) available for each of these sectors varies; but fall into the general categories presented in Table 4-1 below. The categories were developed based on the small business definition and data sources used. Sector Category #1 includes all NAICS codes for which employment and revenue data are readily available from the U.S. Census Statistics of U.S Businesses and where the applicable small business threshold is based on either revenue or employment. Sector Category #2 includes utilities, where the definition of what constitutes a small business is based on the amount of electricity generated, and data from the Energy Information Administration are used to estimate small entity impacts. Category #3 is government jurisdictions, where the small business threshold is defined in terms of population and data from the U.S. Census of Governments are used to estimate revenue. Agricultural sectors are grouped together in Sector Category #4 and are not considered in this analysis. Finally, Sector Category #5 includes facilities that reported invalid NAICS codes and are not considered in this analysis.
Table 4-1:  Categorization of Sectors Affected by Final Rule
Sector Category #
Category Description
# Facilities in Category
                                       1
Sectors covered by U.S. Census data
                                                                         19,800
                                       2
Utility sectors with small business definitions based on electricity generation
                                                                            532
                                       3
Government Jurisdictions
                                                                            503
                                       4
Agricultural sectors not covered by U.S. Census data
                                                                             22
                                       5
Facilities reporting invalid NAICS codes
                                                                             47
Total # of TRI Facilities
                                                                         20,904
Source:  U.S. EPA. 2012b. TRI RY2010: NA2010. Accessed via TRI.NET

For Sector Categories 1 through 3 in Table 4-1, different data sources were used to estimate relevant economic sizes, and then the impacts of the final rule on small entities. Although the data sources varied, the general methodology used to estimate the impacts on small entities across all sectors consisted of the following steps:
      Step 1:	Identify the universe of affected TRI facilities.
      Step 2:	Characterize the relationships between facilities and their parents in the affected universe.
      Step 3:	Estimate annual revenue of parent entities in the affected universe.
      Step 4:	Identify small parent entities based on SBA definitions (see Section 4.2).
      Step 5:	Develop parent entity cost estimates, based on the number of facilities per parent estimated in Step 2.
      Step 6:	Calculate the parent entity cost impact ratio, defined as the cost as a percentage of annual revenue, as a measure of regulatory burden.
      Step 7:	Estimate the number and percentage of small parent companies with company-level impact percentages in each of three categories: (1) less than one percent of annual revenue; (2) between one and three percent of annual revenue; and (3) greater than or equal to three percent of annual revenue.
The specific assumptions and calculations used to estimate impacts for each category of facilities are described in more detail in the sections that follow. Section 4.4 considers the impacts of the final rule on small businesses in sectors for which information is available from the 2007 U.S. Census Statistics of U.S. Businesses (SUSB) (Section 4.4.1) and utility sectors (Section 4.4.2). Potential impacts of the final rule on small governmental jurisdictions are considered in Section 4.5.
Impacts on Small Businesses
Census Sectors
The majority of TRI sectors (494 of 532, or 93 percent) have revenue and employment data available from the U.S. Census Statistics of U.S. Businesses (SUSB) (U.S. Census Bureau, 2010c). The sectors with data available from SUSB are summarized in Table 4-2 below.
Table 4-2:  Sectors with Information in SUSB
                                 2-Digit NAICS
                               NAICS Description
                             # 6-Digit NAICS Codes
                                      21
Mining, Quarrying, and Oil and Gas Extraction
                                                                             19
                                      22
Utilities
                                                                              2
                                      23
Construction
                                                                              3
                                     31-33
Manufacturing
                                                                            418
                                      42
Wholesale Trade
                                                                             16
                                     44-45
Retail Trade
                                                                              6
                                     48-49
Transportation and Warehousing
                                                                              6
                                      51
Information
                                                                              3
                                      54
Professional, Scientific, and Technical Services
                                                                              5
                                      55
Management of Companies and Enterprises
                                                                              1
                                      56
Administrative and Support and Waste Management and Remediation Services
                                                                             11
                                      71
Arts, Entertainment, and Recreation
                                                                              1
                                      81
Other Services (Except Public Administration)
                                                                              3
Total Number of TRI Sectors with Information in SUSB
                                                                            494
Source:  U.S. EPA. 2012b. TRI RY2010: NA2010. Accessed via TRI.NET

The SUSB provides annual data for U.S. business establishments by geography, industry, and enterprise size, covering all business establishments with paid employees. The data provided annually includes counts of establishments, firms, employees, and payroll. Data on total receipts are also provided by SUSB every five years. The data available from the SUSB can therefore be used to identify the number of small parent entities affected under the final rule, construct annual revenue, and calculate cost impact ratios.
A sector's small business definition is based on either its annual revenue or the number of its employees, depending on the sector. The SUSB provides information tabulated by employment size or revenue size. For those sectors with revenue-based small business definitions, profiles were developed for each revenue size category. For sectors with employment-based small business definitions, profiles were developed for employment size categories.
Identify Universe of Affected TRI Facilities
The NAICS code of each affected TRI facility is known based on its RY2010 submission. Based on information submitted by TRI filers, 19,800 facilities reported to TRI in RY2010 from the 494 sectors with data in SUSB. The distribution of these facilities across NAICS codes is shown at the 2-digit level in Table 4-3.
Table 4-3:  Universe of Affected TRI Facilities in Sectors with Data in SUSB
                                 2-Digit NAICS
                               NAICS Description
                                 # Facilities
                                      21
Mining, Quarrying, and Oil and Gas Extraction
                                                                            187
                                      22
Utilities
                                                                              5
                                      23
Construction
                                                                              3
                                     31-33
Manufacturing
                                                                         18,350
                                      42
Wholesale Trade
                                                                            964
                                     44-45
Retail Trade
                                                                             20
                                     48-49
Transportation and Warehousing
                                                                             17
                                      51
Information
                                                                              5
                                      54
Professional, Scientific, and Technical Services
                                                                             10
                                      55
Management of Companies and Enterprises
                                                                              1
                                      56
Administrative and Support and Waste Management and Remediation Services
                                                                            228
                                      71
Arts, Entertainment, and Recreation
                                                                              1
                                      81
Other Services (Except Public Administration)
                                                                              9
Total Number of TRI Facilities in Sectors with Information in SUSB
                                                                         19,800
Source:  U.S. EPA. 2012b. TRI RY2010: NA2010. Accessed via TRI.NET

Characterize Facility-Parent Relationships
Compliance costs and impacts are estimated at the parent entity level, where a parent entity may own one or more facilities. The average number of facilities filing reports to TRI per parent company for the TRI sectors with information in SUSB is estimated by taking the average of the number of RY2010 reporters associated with each parent company with a facility in that sector (Abt Associates, Inc., 2011). Note that it is not possible to distinguish small parents from large parents in the TRI data; rather, a single average of number of facilities per parent is used for each sector. Because these averages contain large parent companies as well as small, they are likely to overestimate the number of facilities per small parent entity. This inclusion of large parent companies in the average facility numbers leads to more conservative estimates of total compliance costs incurred by small parent companies.
Estimate Annual Revenue of Parent Entities
The SUSB data include the total annual receipts (defined as the revenue for goods produced, distributed, or services provided) for each NAICS/revenue or employment size class combination. For each of the 494 TRI sectors with data in SUSB, EPA calculates average revenue per "small" entity using the appropriate employment size or revenue size tabulation. To do this, the total revenue and total number of firms are summed across all "small" revenue or employment size classes for each NAICS code.[,] The total revenue of all "small" revenue or employment size classes is then divided by the number of "small" firms in each size class to calculate an average revenue per "small" firm by NAICS code.
In some cases, total revenue for a revenue or employment size class was not provided in the SUSB data because doing so would disclose the operations of an individual establishment or firm. In these cases, the total revenue is interpolated based on the available data. For sectors with revenue-based small business definitions, the midpoint of the revenue size class is multiplied by the number of firms in that size class as an estimate for the total revenue. For sectors with employment-based small business definitions, the following method is used to estimate total revenue for those NAICS/employment size class combinations where revenue was not disclosed:
 Calculate the average revenue per firm for every NAICS/employment size class combination where data are available.
 Calculate the percent difference between average revenue in adjacent employment size classes based the on all TRI NAICS codes populated with revenue information in the relevant adjacent employment class sizes.
 For the NAICS/employment size class combination with no average revenue data, multiply the average revenue of the adjacent employment size class in that NAICS code by the average percent difference between the two adjacent employment size classes across all TRI NAICS codes to estimate the average revenue.
 Where average revenue is available for both adjacent employment size classes, average the two estimated average revenues to obtain average revenue for the missing NAICS/employment size class combination. Where average revenue is available for only one of the adjacent size classes, use the estimated average revenue based on the size class with data.
 Multiply the estimated average revenue by the number of firms to estimate the total revenue for that NAICS/employment size class.
 In the case where no revenue data was available from SUSB for any employment size class, the facility is considered at the 5-digit NAICS level rather than the 6-digit NAICS level.

Because the SUSB data reflect 2007 annual revenue, it was necessary to inflate the revenue to current dollars using one of several indices. The Industrial Production Index (IPI) measures the amount of industrial output from certain industries and is used to inflate annual revenue in mining (NAICS 21) and manufacturing (NAICS 31-33) sectors to 2011 dollars (U.S. Federal Reserve, 2012). All other sectors (NAICS 42-81) are inflated based on the change in Gross Domestic Product (GDP) from 2007 to 2011, which is a measure of overall economic output (BEA, 2012).
Estimate Number of Small Parent Entities
EPA estimates the number of small parent entities in each NAICS code by distributing the total number of TRI facilities in each NAICS code amongst the employment or revenue size classes based on the overall distribution of establishments amongst the size classes in the SUSB data. The number of TRI facilities in "small" revenue or employment size classes is then summed and divided by the average number of TRI facilities per parent in that NAICS code to obtain a count of small parent entities by NAICS code. Using this method, a total of 3,060 small parent entities will be potentially affected by the final rule.
Estimate Parent Entity Compliance Costs
Since it was not possible to predict which facilities will incur compliance determination costs, all facilities were conservatively estimated to incur both compliance determination and rule familiarization costs for the small entity analysis. An affected parent entity will incur compliance costs once for each TRI facility it operates. Therefore, the per-facility compliance cost is multiplied by the average number of facilities per parent to calculate the total per parent compliance cost for each NAICS code affected under the final rule.
Estimate Cost Impact Ratios
To calculate the cost impact ratio, the first-year compliance cost of a parent entity was divided by the average revenue per small parent entity for each affected sector. These results are summarized in Table 4-4. Based on this calculation, no small parent is expected to incur an impact equal to or greater than one percent of annual revenue. The median impact incurred by small parents is 0.003 percent, which is incurred by small parent entities in NAICS 326199, All Other Plastics Product Manufacturing. The maximum impact incurred by any small parent is 0.713 percent, which is incurred by small parent entities in NAICS 221320, Sewage Treatment Facilities.  Note that because average revenues for small parent entities in each sector are used, the possibility exists that a parent entity with revenues lower than the average revenue could incur cost impacts of greater than one percent of revenues.  However, assuming that the smallest affected parent is likely only to own one facility, it would only incur a compliance cost of $44.64.  Therefore, in order for regulatory costs to exceed one percent of revenues, annual revenues would have to be less than $4,464, which is highly unlikely.
Table 4-4:  Estimated Impacts of Final Rule on Small Parent Entities in Census Sectors

                                Cost Impact of
                                    <1%
                             Cost Impact Between
                                   1% and 3%
                             Cost Impact of >3%

                                       #
                                       %
                                       #
                                       %
                                       #
                                       %
# Small parent entities
                                                                          3,060
                                                                            100
                                                                              0
                                                                              0
                                                                              0
                                                                              0

Utilities
For six utility sectors, the small business definition is based on electricity generation rather than employment or annual revenue. Therefore, for these sectors, it is necessary to use an alternate method to determine the impacts of the final rule on small entities. The six sectors with small business definitions based on electricity generation are:
221111 Hydroelectric Power Generation
   221112 Fossil Fuel Electric Power Generation
221113 Nuclear Power Generation
221119 Other Electric Power Generation
221121 Electric Bulk Power Transmission and Control
221122 Electric Power Distribution

The Energy Information Administration (EIA) maintains monthly and annual data on electricity generation and fuel consumption for U.S. power plants in its EIA-923 database. EPA uses this information to identify small entities and to construct annual revenue of small parents operating TRI utility facilities.
Characterize the Universe of Affected TRI Facilities
In RY2010, 635 TRI facilities reported a utility NAICS code. However, some facilities reporting to TRI from utility NAICS codes are operated by municipal, state, or federal governments. As these facilities are operated by governments, the potential impacts on small entities must be considered using the government definition of a small entity. This analysis assumes that 103 utilities are operated by governments, identified based on the reported parent and facility name in RY2010 and are considered in Section 4.5.
The remaining 532 TRI utility facilities were found in the Energy Information Administration (EIA) databases by querying the Facility Registry System (FRS) for all EPA-regulated facilities with information in EIA databases (based on the Emissions & Generation Resource Integrated Database (eGRID) and the Clean Air Markets Division Business System (CAMDBS) facility linkages) (U.S. EPA, 2012a). Any facility not matched to an EIA record based on an FRS linkage was then matched based on facility name and address. All but four TRI utility facilities were matched to information in EIA databases. An additional two facilities were matched to an EIA facility but did not have generation data for RY2010. It was assumed that the potential impacts on the six facilities for which information could not be located would follow the distribution of impacts on the 532 facilities for which EIA records were available. The TRI utility facility universe is summarized in Table 4-5 below.
Table 4-5:  TRI Utility Universe
Utility Universe
# Facilities
TRI Utility Facilities
                                                                            635
     TRI Utility Facilities not Operated by Governments
                                                                            532
          TRI Utility Facilities with Information in EIA databases
                                                                            526
Sources:
U.S. EPA. 2012b. TRI RY2010: NA2010. Accessed via TRI.NET
U.S. Energy Information Administration (EIA), U.S. Department of Energy. 2012a. Form EIA-923 Database. <http://www.eia.doe.gov/cneaf/electricity/page/eia906_920.html>

Characterize Facility-Parent Relationships
Each utility was matched to its parent based on the TRI data for RY2010 (Abt Associates, Inc., 2011). The 532 TRI utilities correspond to 175 parent companies (four of which correspond exclusively to TRI facilities for which no electricity generation information is available from EIA). Because the parent company of each utility is known based on the parent company reported to TRI for RY2010, the actual number of utilities per parent is calculated for each parent entity, as opposed to an average by sector as was done in Section 4.4. This results in 104 parents operating only one TRI utility, and the largest parent operating 26 TRI utility facilities.
Estimate Annual Revenue of Parent Entities
As stated above, the EIA-923 database provides information about the annual electricity generation of each power plant in the U.S. The EIA also provides information about the average retail price of electricity to ultimate customers by end-use sector, by state, on a monthly basis (EIA, 2012b). Annual electricity generation and price were combined to generate an estimate of annual revenue. Specifically, a national average of 9.67 cents per kilowatt-hour, or $96.70 per megawatt-hour (November 2011) is multiplied by the total electricity generation per parent to construct annual revenue for each parent entity.
For the four parent entities of facilities without electricity generation data in the EIA-923 database, it was not possible to estimate their annual revenue. Instead, the impacts on these parent entities were modeled based on the distribution of impacts amongst the other 171 parent entities, as discussed below.
Estimate the Number of Small Parent Entities
Small utilities are defined as those businesses that are primarily engaged in the generation, transmission, and/or distribution of electric energy for sale with the total electric output for the fiscal year not exceeding 4 million megawatt-hours. Small utility parent entities were identified by aggregating the individual facility net generation to the parent level, and applying this definition. Of the 171 utility parent entities for which electricity generation data were available, 107 (63%) meet the definition of a small parent entity. For the remaining four parent entities of facilities without electricity generation data, it was assumed that the percentage of small parent entities within the larger utility parent entity universe (63%) applied, i.e., that three of four parent entities were small. Therefore, of the total 175 TRI utility parent entities, 110 are assumed to meet the definition of a small parent entity.
Estimate Parent Entity Compliance Costs
Since it was not possible to predict which facilities will incur compliance determination costs, all facilities were conservatively estimated to incur both compliance determination and rule familiarization costs for the small entity analysis. An affected parent entity will incur compliance costs once for each TRI utility it operates. Therefore, the per-facility compliance cost is multiplied by the number of utilities per parent to calculate the total compliance cost for each parent entity affected under the final rule.
Estimate Cost Impact Ratios
The cost impact ratios for small parent entities operating TRI utilities are estimated by dividing the total compliance cost for each parent entity by their estimated annual revenue. For the 107 small parents of facilities with electricity generation data available from EIA, no small parent is expected to incur an impact of greater than one percent of annual revenue. For the remaining three small parents of facilities with no electricity generation data available from EIA, it was assumed that the impacts follow the distribution of impacts on the other 107 parent entities, and therefore no parent entity will incur an impact greater than one percent of annual revenue. The median impact incurred by any small parent is 0.0001 percent, which is incurred by a small parent in NAICS 221112 Fossil Fuel Electric Power Generation. The maximum impact incurred by any small parent is 0.004 percent, which is incurred by a small parent in NAICS 221112 Fossil Fuel Electric Power Generation. These results are summarized in Table 4-6.
Table 4-6:  Estimated Impacts of Final Rule on Small Parent Entities in Utility Sectors

                                Cost Impact of
                                    <1%
                             Cost Impact Between
                                   1% and 3%
                             Cost Impact of >3%

                                       #
                                       %
                                       #
                                       %
                                       #
                                       %
# Small parent entities with information available from EIA
                                                                            107
                                                                            100
                                                                              0
                                                                              0
                                                                              0
                                                                              0
# Small parent entities without information available from EIA
                                                                              3
                                                                            100
                                                                              0
                                                                              0
                                                                              0
                                                                              0
All small parent entities
                                                                            110
                                                                              0
                                                                              0
                                                                              0
                                                                              0
                                                                              0

Impacts on Small Government Jurisdictions
Some TRI facilities are operated by local, state, or federal governments. The potential impacts of the rule on small government parent entities must therefore be estimated. A separate methodology based on information from the U.S. Census of Governments is used. The Census of Governments characterizes the scope and nature of the nation's state and local governments; provides authoritative benchmark figures of public finance and public employment; classifies local government organizations, powers, and activities; and measures federal, state, and local fiscal relationships. Information is available by level of government and category of governmental activity. The sections that follow discuss the method used to calculate the impacts on small local governments operating TRI facilities.
Identify Universe of Affected TRI Facilities
TRI facilities operated by government jurisdictions were identified based on the reported parent and facility name in RY2010. This method identified a total of 503 government owned TRI facilities reporting in RY2010. However, 434 of these facilities are owned by states or the federal government, and do not meet the definition of a small government jurisdiction as they serve a population of greater than 50,000 people. The remaining 69 government owned TRI facilities are operated by municipalities that could be potentially affected under the final rule. The universe of government owned TRI facilities is summarized in Table 4-7.
Table 4-7:  TRI Government Owned Facility Universe
Utility Universe
# Facilities
TRI Facilities Owned by a Government Jurisdiction
                                                                            503
 TRI Facilities Owned by a Municipality
                                                                             69
Source:  U.S. EPA. 2012b. TRI RY2010: NA2010. Accessed via TRI.NET

In order to use the data available from the Census of Governments to construct municipal revenue and identify small municipalities, it is necessary to match each affected TRI facility to a local government on the Census list. Each of the TRI facilities owned by a municipality was matched to a city on the Census list of municipalities.
Characterize Facility-Parent Relationships
Compliance costs are estimated at the parent entity level, where a parent entity may own one or more facilities. Therefore, it is necessary to consider municipalities operating multiple TRI facilities. Because the universe of TRI facilities owned by municipalities is based on a unique list of facilities matched to individual local governments, it is possible to determine the number of TRI facilities operated by each municipality and calculate the number of facilities per parent based on the known number of facilities operated by each municipality. The 69 facilities owned by municipalities correspond to a total of 61 unique municipalities, with the majority operating only one TRI facility.
Estimate Annual Revenue of Parent Entities
Because the Census of Governments does not provide revenue data for individual municipalities, it is necessary to develop a method to estimate revenue based on available information. The Government Finance series in the 2002 Census of Governments provides information at the state level regarding the per capita revenue of municipalities by population-size range (U.S. Census Bureau, 2005).
The 2002 Census of Governments per capita revenues must be inflated to 2011 dollars. The Gross Domestic Product (GDP) inflation index, which is a measure of overall economic output, is used to adjust 2002 revenue to 2011 dollars (BEA, 2012). Note that this method may overstate current revenue because the GDP is a measure of overall economic output and does not directly correlate to government revenue; however, it is considered the best available index to use in this situation.
To estimate the annual revenue for each affected municipality, the inflated per capita revenue is multiplied by the population of the municipality. Population information was obtained from the U.S. Census 2010 Census Summary Files (U.S. Census Bureau, 2010b).
Estimate the Number of Small Parent Entities
As discussed in Section 4.5, "small governmental jurisdictions" are defined as the government of a city, county, town, school district or special district with a population of fewer than 50,000 people. Therefore, any local government operating a TRI facility serving a population of 50,000 or fewer is considered "small", based on the 2010 population of each affected municipality. Based on this method, 40 of the 61 affected municipalities are small.
Estimate Parent Entity Compliance Costs
Since it was not possible to predict which facilities will incur compliance determination costs, all facilities were conservatively estimated to incur both compliance determination and rule familiarization costs for the small entity analysis. An affected municipality will incur compliance costs once for each TRI facility it operates. Therefore, the per-facility compliance cost is multiplied by the average number of facilities per municipality to calculate the total per parent compliance cost for each NAICS code affected under the final rule.
Estimate Cost Impact Ratios
The cost impact ratios for small municipalities are estimated by dividing the total compliance cost for that entity by the annual revenue of the local government. Based on this calculation, no small municipality is expected to incur an impact of equal to or greater than one percent of annual revenue under any of the scenarios considered. These results are summarized in Table 4-8. The median impact incurred by any municipality is 0.0001 percent, which is incurred by a small municipality in NAICS 221310, Water Supply and Irrigation Systems. The maximum impact incurred by any municipality is 0.019 percent, which is incurred by a small municipality in NAICS 221112, Fossil Fuel Electric Power Generation.
Table 4-8:  Estimated Impacts of Final Rule on Small Government Jurisdictions

                                Cost Impact of
                                    <1%
                             Cost Impact Between
                                   1% and 3%
                             Cost Impact of >3%

                                       #
                                       %
                                       #
                                       %
                                       #
                                       %
# Small parent entities
                                      40
                                      100
                                       0
                                       0
                                       0
                                       0

Summary
This chapter estimates small entity impacts for small businesses in sectors for which information is available from the 2007 U.S. Census Statistics of U.S. Businesses (SUSB) and utility sectors; as well as for small governmental jurisdictions. Of these sectors, no small parent is expected to incur an impact of greater than one percent of annual revenue, as is shown in Table 4-9. The median impact incurred by any small parent entity is 0.003 percent, which is incurred by small parent entities in NAICS 321219, Reconstituted Wood Product Manufacturing. The maximum impact incurred by any small parent entity is 0.713 percent, which is incurred by small parent entities in NAICS 221320, Sewage Treatment Facilities.
Table 4-9:  Estimated Impacts of Final Rule on Small Parent Entities

                                Cost Impact of
                                    <1%
                             Cost Impact Between
                                   1% and 3%
                             Cost Impact of >3%

                                       #
                                       %
                                       #
                                       %
                                       #
                                       %
# Small parent entities
                                     3,210
                                      100
                                       0
                                       0
                                       0
                                       0

 -  Benefits
In enacting the Emergency Planning and Community Right-to-Know Act (EPCRA) of 1986 and the Pollution Prevention Act (PPA) of 1990, Congress recognized the significant benefits of providing information on the presence, releases and waste management of toxic chemicals. The Toxics Release Inventory (TRI) has proven to be one of the most influential forces in empowering the federal government, state and local governments, industry, environmental groups, and the general public to fully participate in an informed dialogue about the environmental impacts of toxic chemicals in the United States. The TRI database provides several types of information, including quantitative information on toxic chemical releases and other waste management practices. Starting in 1987, the collection of this information enhanced the ability for the public, government, and the regulated community to understand the breadth and magnitude of chemical releases in the United States, and to assess the need to reduce the releases and transfers of toxic chemicals. TRI data enable all interested parties to establish credible hazardous chemical quantity baselines, to set realistic goals for environmental progress, and to measure progress in meeting these goals over time. As such, the TRI program has become a yardstick by which environmental progress can be measured by all interested or affected stakeholders.
Although EPA has not attempted to quantify the benefits of the final rule, the desired outcome of this final rule is to further encourage tribal engagement and participation in the TRI program. Tribes will have the opportunity to request that EPA require a specific facility or facilities located within the Tribe's Indian country to report to TRI. The Tribes will also be able to petition for the addition or deletion of certain chemicals, which apply to all facilities releasing the particular substance(s). These types of provisions already apply in the context of requests/petitions by Governors of States. By increasing the participation and engagement of tribal governments in the TRI program, EPA is helping to increase awareness of toxic releases within these communities, thereby increasing the understanding of potential human health impacts from these hazardous chemicals.

 -  Literature Cited
Abt Associates, Inc. 2011. List of Corporate Parents Used to Pre-Populate TRI-MEweb for RY2010.
Rice (2002) Wage Rates for Economic Analysis of the Toxics Release Inventory Program.

U.S. Bureau of Economic Analysis (BEA), U.S. Department of Commerce. 2012. National Income and Products Accounts Tables, Table 1.1.9. Implicit Price Deflators for Gross Domestic Product. http://www.bea.gov/index.htm
U.S. Census Bureau. 2005. 2002 Census of Governments:  Government Finance:  Finances of Municipal and Township Governments:  2002.Vol 4, No. 4, Issued April 2005. http://www.census.gov/prod/2005pubs/gc02x43.pdf
U.S. Census Bureau. 2010a. Federal, State, & Local Governments:  Definitions. http://www.census.gov/govs/definitions/index.html
U.S. Census Bureau. 2010b. 2010 Census Summary File 1: P1: Total Population. Accessed via American FactFinder. http://factfinder2.census.gov/faces/nav/jsf/pages/index.xhtml
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U.S. EPA. 2012a. Facility Registry System (FRS). http://www.epa.gov/enviro/html/fii/fii_query_java.html
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U.S. SBA. 2008. Table of Small Business Size Standards Matched to North American Industry Classification System Codes. http://www.sba.gov/sites/default/files/Size_Standards_Table.pdf. Downloaded on February 8, 2011.
U.S. SBA. Office of Advocacy. 2010. Statistics  -  All Industries by NAICS Codes, 2007: Employer Firms & Employment by Employment Size of Firm by NAICS Codes, 2007. Information from the Small Business Administration on the Internet. http://www.sba.gov/advo/research/us07_n6.pdf Downloaded on April 6, 2011.