the digitized handwritten signature method so that we can confirm or
repudiate the belief that there generally may be the same level of
legal dependability for electronic manifests signed with digitized
handwritten signatures as there is now for paper manifests (or images
of paper manifests) and their handwritten signatures.\10\
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    \9\ In 1994, Congress amended the Hazardous Materials
Transportation Act (HMTA) to provide that an electronic image of a
shipping paper may be retained by an offeror or carrier, in lieu of
the paper record, as the legal record to be made available for
inspection by enforcement agencies. See 49 U.S.C. 5110(e), added by
Public Law 103-311, Title I, Sec. 115 (August 26, 1994). The
hazardous waste manifest is a Hazardous Materials shipping paper,
and EPA is required by statute to be consistent with the Hazmat law
in developing our transportation requirements, such as the manifest
regulations. In 1996, EPA/OSWER announced a policy allowing
hazardous waste facilities under specified conditions to retain
scanned and retrievable image files of paper manifests in lieu of
retaining their paper copies. EPA believes that high quality
digitized signature products can create electronic signatures with
evidentiary strength that exceeds that of the ``flat image''
manifest signatures that are now accepted under the paper manifest
system.
    \10\ The digitized handwritten signatures should improve
signature quality by ensuring that a consistent quality signature is
retained for all collected manifest signatures, regardless of the
order in which the manifest was signed. Many paper manifest
signatures today are carbon copy signatures of very uneven quality
or legibility.
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    We anticipate that validating peer reviewed studies will
demonstrate that high quality digitized handwritten signature products
produce valid electronic signatures for purposes of CROMERR. In this
instance, the handwritten signature image data and the collected
forensic evidence would constitute the ``electronic signature device''
for purposes of CROMERR. We also anticipate that validating peer
reviewed studies will also demonstrate that the high quality digitized
handwritten signature devices successfully capture and record
information that is both unique to the signatory and sufficiently
immutable that the resulting signature may operate similarly to a
biometric for purposes of CROMERR. Since a digitized handwritten
signature does not rely on a secret PIN or password code, CROMERR does
not require a digitized handwritten signature to implement a second
authenticating factor to show that it has not been compromised.
Furthermore, as these signatures are in their nature handwritten
signatures that will be authenticated based on their unique forensic
evidence similar to conventional ink signatures, it should not be
necessary to establish one's ownership of a digitized handwritten
signature through a separate identity proofing process any more than it
is necessary to engage in identity proofing of conventional handwritten
signatures.\11\ EPA anticipates that the validating peer reviewed
studies will demonstrate that with the appropriate implementation and
technology, a digitized handwritten signature can verify or
authenticate the identity of an individual in the same way that
handwritten signatures on paper are authenticated, that is, by their
appearance and by the forensic evidence surrounding their execution.
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    \11\ Moreover, since there is no showing required currently to
establish that one signing a paper manifest is authorized to sign
manifests for the entity that he or she represents, this rule does
not require a separate identity proofing to establish the
relationship of the owner of an electronic signature device to a
particular entity.
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    In order for digitized handwritten signatures to function as
dependably as handwritten signatures executed with paper manifests, it
is critical that this signature method be implemented with high quality
digitized signature pads and software. Rather than codifying the
performance and quality requirements for these devices in this final
regulation, EPA will specify performance requirements in the
procurement documents that will address the e-Manifest system
acquisition. Based on our current understanding of the capabilities and
features of digitized signature products, EPA is exploring and will
seek to validate products that have these or similar characteristics:

     They produce handwritten signatures that may be captured
and displayed with a sufficiently high resolution, e.g., at least 300
dots per inch;
     They collect forensic data, e.g., all three signature (x,
y, and z) coordinates, time of signature, acceleration, or pressure,
etc., and retain these data as a part of the signature record;
     They record all signature input data at a sufficiently
high frequency to characterize accurately each signature act, e.g., at
least 100 samples or reports per second;
     They can execute, on average, many individual signatures
(e.g., 100,000) between failures, where failure involves the loss of
any pixels in the signature image;
     They employ a ``hash'' function to digitally attach the
signature to the data that are signed, so that alterations to the
document contents can be detected;
     They are supported by software that can analyze the
forensic signature measurements captured with each electronic
signature, and that allows a trained, professional forensic document
examiner to use the measurements and analysis to compare a given
electronic signature with a signature exemplar submitted by the named
signatory;
     They are supported by peer-reviewed studies which show
that the technology has been thoroughly tested, that the known or
potential error rate of the technology has been established and is
acceptable, and that the technology reliably collects, processes, and
interprets the forensic data from handwritten digitized signatures; and
     The forensic signature measurements and analyses performed
by the software, and the comparisons of digitized handwritten
signatures and exemplars conducted by a trained, professional document
examiner, will enable a professional document examiner trained in the
technology to provide expert opinion testimony, with a high degree of
confidence, that a questioned digitized handwritten signature is or is
not the authentic signature of the signatory.
    ii. Interim Approach to Implementation. As discussed above, for the
digitized signature method to be implemented as a fully CROMERR
compliant and valid electronic signature, there must first be completed
the peer reviewed studies showing the forensic reliability of this
signature technology. However, in the event that EPA or others are not
able to complete the necessary studies prior to the implementation date
of today's rule, EPA may allow the deployment of this method on an
interim basis (with some paper/ink signature requirements) pending the
results of the studies.
    Under such an interim implementation, EPA would accept the
deployment of digitized signature pads and/or digital pens that
simultaneously capture an ink signature. We are aware of several
existing products with this capability. One paper copy of the manifest
would be executed for each shipment with the original ink signatures of
all the hazardous waste handlers, while the digitized signatures would
simultaneously be collected and associated with the electronic
manifests that would be distributed and retained by the e-Manifest
system. At the end of the waste shipment transaction, the designated
facility would retain the one paper copy with the original ink
signatures among its operating records for at least three years, just
as designated facilities currently retain a final paper manifest copy
among their records. The designated facility would retain this paper
copy securely and make it available for inspection and enforcement
purposes by state or federal inspectors. Thus, during the interim
period of implementation, the one paper copy with ink signatures would
remain the copy of record for all enforcement actions involving that
manifest. In the event of an enforcement action where a manifest
signature is at issue, the paper copy would be produced for enforcement
officials, and the ink signatures on this stored copy would be
authenticated by document examiners in the same manner that such ink
signatures are currently authenticated in enforcement actions. The
digitized signature images captured on the electronic manifest copies
in the system could be relied upon by e-Manifest users for all other
purposes. Since civil and criminal enforcement actions would continue
to rely on enforcing the paper manifest copy with its handwritten ink
signatures, the effect of this interim solution is to defer full
CROMERR compliance with respect to e-Manifest until the program is
ready to implement a fully paperless system that would rely on the
authentication of the digitized signatures in enforcement actions.
    While this interim solution might appear to be inconsistent with
the goal of a fully paperless manifest, EPA emphasizes that after the
implementation of the e-Manifest system, DOT's HMR will continue to
require hazardous waste transporters to carry a hazardous materials
shipping paper (i.e., the manifest) on transport vehicles. So, e-
Manifest users would still be required for the foreseeable future to
produce one paper copy of the manifest in order to comply with these
existing DOT shipping paper requirements. Since there will need to be
one paper copy of the manifest carried on the transport vehicle in any
case for DOT's purposes, the use of this one paper copy to
simultaneously record enforceable ink signatures under this interim
solution will not result in additional paperwork being supplied.
Moreover, most of the paperwork reduction, greater efficiency, and data
quality enhancement benefits of the electronic manifest will still be
realized even with the execution and retention of this one paper
manifest copy as an enforcement copy of record.
    We anticipate that this interim signature method could be used
until such time as EPA is able to identify specific digitized signature
products that have been tested and found through peer reviewed studies
to meet the forensic reliability standard. During the interim period,
however, certain digitized signature products could be deployed, and
the peer reviewed studies could be set up to take advantage of the data
developed using several such products under a test protocol that would
enable us to identify the high quality digitized handwritten signatures
that could stand alone as enforceable and legally valid electronic
signatures without any paper copy back-up.
    To address the use of digitized handwritten signatures (or other
electronic signature methods) during this interim period pending the
completion of the tests (and peer reviewed studies) that would
demonstrate the signature method's legal dependability or practicality,
we have included appropriate regulatory provisions in this final rule.
These special procedures will provide that the one printed copy of the
manifest that is required by EPA and DOT regulations to be carried on
transport vehicles shall in such cases of electronic signature tests be
signed in ink by the generator, transporter, and designated facility
owner or operator. At the end of the shipment, the printed copy bearing
all the original ink signatures shall be retained by the designated
facility among its records, and made available to federal and state
RCRA inspectors to support their compliance monitoring and enforcement
activities. These special procedures are codified for generators at 40
CFR 262.24(f), for transporters at 40 CFR 263.20(a)(7), and for owners
or operators of designated facilities at 40 CFR 264.72(i) and
265.72(i). These procedures are sufficiently flexible to apply over the
life cycle of the system to the use of any electronic signature method
that would benefit from a pilot or demonstration

test before a decision is made to fully implement the method as a
legally valid and enforceable electronic signature.
    6. PIN or Password Electronic Signature.
    i. Introduction. In addition to the digitized signature method
discussed above, EPA recommends PIN and password-based electronic
signatures for the first generation e-Manifest system. As with the
digitized signature method discussed above, the PIN or password
signature must also activate a hash function or equivalent technology,
so that the electronic signature will be bound to the document content,
and any data alterations attempted after signature may be detected.
    The main advantage of the PIN/password signature for these
signatories is that a signature can be applied through any keypad-
enabled device that can access the e-Manifest. EPA understands that
mobile devices with digitizer pads may not be available or attractive
to all manifest users. We believe that the PIN/password electronic
signature method provides a reasonable alternative for these
prospective manifest users.
    EPA received many public comments on the May 2001 proposed rule
urging the Agency to implement a PIN/password signature approach for
the e-Manifest, as these users believed that PINs or passwords would be
more cost-effective for users than those methods that required the
purchase and use of peripherals, such as digitizer pads and the
software needed to operate them. PINs and passwords are commonly
implemented as an authentication approach in many electronic systems,
and they are fairly easy to implement and validate. The technical basis
for executing and validating a PIN or password signature is well
established, and there is no need for studies to establish their
technical reliability. Moreover, the May 2007 economic analysis of
electronic signature methods confirmed that PIN/password signatures
were fairly inexpensive for the electronic manifest community, with
average costs between $.50 to $.96 per manifest. However, as previously
noted, our analysis concluded that PINs and passwords may not be as
inexpensive a signature method as the digitized handwritten signature
over the life cycle of the system, since PINs and passwords are
frequently lost or forgotten, and help desk support or self-service
password management software may be required to reset them.
    While PINs/passwords have these drawbacks, the Agency believes that
PIN/password-based electronic signatures can be implemented for the e-
Manifest system in a manner that is both consistent with the CROMERR
standards and at a cost that would not discourage use of the system.
Manifest users have commented that PINs and passwords would be readily
accepted by many prospective e-Manifest users, and our May 2007
economic analysis confirms that this signature method may pose
acceptable costs, despite the help desk and other management costs
associated with PINs and passwords.
    ii. CROMERR Identity Proofing Requirements. By adopting the
standards set forth in CROMERR, today's rule requires that the identity
of those who would sign electronic manifests with a PIN or password
electronic signature must be established with legal certainty. Section
3.2000(b)(5)(vii) of CROMERR addresses identity proofing by adopting a
performance standard that requires that electronic reporting systems
have a process for determining with legal certainty the ownership of an
electronic signature device and the relation of the signatory to the
entity on whose behalf he or she signs an electronic document. 70 FR
59848 at 59872. This provision of CROMERR requires that a system
provide evidence sufficient to prove the device owner's identity and
relation to an entity, particularly in the context where the signatory
may have an interest in repudiating their own signature or their
relationship to the entity on whose behalf the signature is executed.
While Sec.  3.2000(b)(5)(vii) of CROMERR does not specify how this
performance standard is to be met \12\, the rule does require that, at
a minimum, the identify-proofing process must involve access to a set
of descriptions that apply uniquely to an individual in question and
refer to attributes that are durable, documented, and objective. Id.
Such descriptions must be capable of being shown to uniquely identify
the individual without having to depend on one such as a signatory who
may want to repudiate their identification. Id. Alternatively, a
subscriber agreement within the meaning of 40 CFR 3.3 may be collected
to satisfy CROMERR identity proofing requirements.
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    \12\ Section 3.2000(b)(5)(vii) describes three identity proofing
methods that have been deemed acceptable for electronic reports that
are submitted to EPA or state systems. These accepted methods under
CROMERR include: (1) The vetting and verification by a disinterested
individual of a person's identifiers or attributes that are
contained in that person's identity credential (e.g., a driver's
license, passport, or financial account), with at least one such
identity credential being a government issued credential; (2) a
method of determining identity that is no less stringent than the
vetting of an identity credential by a disinterested individual; and
(3) the collection of either a CROMERR ``subscriber agreement'' or a
certification from a ``local registration authority'' that such an
agreement has been received and securely stored. 40 CFR
3.2000(b)(5)(vii).
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    iii. CROMERR Second Authentication Factor. CROMERR requires that
any electronic reporting system collect evidence that demonstrates that
an electronic signature device (such as a PIN or password) was not
compromised at the time of use. When the electronic signature consists
of a PIN or password, this feature of CROMERR operates to require a
second authenticating factor that is collected contemporaneously with
the signature to demonstrate with legal certainty that the PIN and
password were not compromised at the time of use. We discuss below two
approaches that we believe may be appropriate for the e-Manifest.
    We should note that EPA evaluated several technology-based second
authenticating factors. Our economic analysis of electronic signature
and authentication methods concluded that the use of some currently
available hardware tokens or biometric devices could triple or
quadruple the per-manifest cost of signing electronic manifests with a
PIN or password. We believe that the addition of these costs to the
PIN/password signature implementation costs could discourage use of the
system by the more cost-sensitive members of the prospective user
population. Therefore, we have chosen, at the outset, to employ second
authenticating factors for PINs or passwords that require no additional
hardware. Again, this should not be taken to mean that the Agency has
forever ruled out all such technology-based approaches to reducing the
vulnerability of a PIN/password signature to compromise. Should other
methods relying on biometrics, hardware tokens, or other technologies
be identified that are inexpensive, effective, and acceptable to the
user community, they certainly would merit consideration for the e-
Manifest system. Likewise, other non-technology methods that rely on
business process adjustments or management controls, and that are
effective in reducing the vulnerability of the PIN/password signature
to compromise, may also be suitable if they meet the requirements of
today's rule and CROMERR.
    a. Personal Question Challenge as Second Authenticating Factor. One
approach that EPA currently allows under CROMERR as a second
authenticating factor for PIN/password signatures is to present the
signatory with a challenge question each time he or she enters their
PIN or password to execute a signature. Under this approach, the PIN/
password electronic

signature can be sufficiently strengthened if the signatory
successfully answers a challenge question from a set of questions for
which the signatory has provided pre-arranged answers. Since only the
actual signatory would likely be able to successfully provide both the
required PIN/password and the correct answer to a personal challenge
question, this approach can provide significant added protection
against signature fraud and repudiation. In administering the CROMERR
regulation, EPA has approved several systems that implement the use of
personal challenge questions as a second authentication factor for PIN/
password signatures. EPA's experience with these systems indicates that
there should be at least 10 candidate questions made available to a
user at the time of registration, although we recommend a longer list
of at least 20 such questions to give the registrant a better chance of
finding several questions that he or she can answer from memory. In any
case, under this method in the past administration of CROMERR, EPA has
required that registrants select and answer five of the candidate
questions at the time of registration with the system. Thereafter, when
the user enters his or her PIN/password electronic signature, he or she
will be presented with one of the five selected challenge questions,
which the system will choose at random. The entry of the correct
response to the challenge question satisfies the CROMERR requirement
for a second factor to strengthen the PIN/password signature.
    The personal question challenge is recognized as a CROMERR
compliant second authentication factor, and this method is therefore
available for the e-Manifest system as a means to strengthen PIN/
password electronic signatures. However, EPA has some concerns that
this method of implementing a PIN or password signature may present
difficulties for e-Manifest users, particularly for hazardous waste
generators. There are about 139,000 RCRA hazardous waste generators
(and many more state-regulated waste generators), many of whom may
decide to use electronic manifests, and many of these generators are
small entities that may ship hazardous waste infrequently, e.g., no
more than two or three times per year. Since these generators will have
infrequent contacts with e-Manifest, we are concerned that these
generators will have difficulty recalling both their passwords and
personal question responses from memory. Manifest signatures occur in
the context of a live, commercial transaction, and the signature data
will likely be entered on mobile devices brought to the generators'
sites. Since the use of electronic manifests will be the default, the
possibility that many generators could have difficulty executing both
their passwords and personal question responses successfully may cause
these users delay and frustration that could result in their continued
reliance on paper manifests. To mitigate this possibility, we are also
recommending an alternative method to the personal question challenge
that users may find more suited to the manifest business process. This
alternative may be used to satisfy CROMERR's requirement for a second
authentication factor for PIN/password signatures for electronic
manifests. It relies on a certification by a signature witness to
strengthen the PIN/password signature. This method is explained in the
preamble section below.
    b. Signature Witnessing as the Second Authenticating Factor for
PIN/Password-Based Electronic Signatures. The ``witnessed signature''
approach takes advantage of a unique feature of the manifest business
process--that is, that manifests are typically signed by one party to
the manifest (e.g., the generator) in the presence of another party to
the manifest (e.g., the initial transporter). Manifests are signed by
the generator when they are certifying to the transporter that the
hazardous waste shipment is properly described and marked, and in
proper condition for transportation. They are signed by transporters
and designated facilities to acknowledge the receipt of the hazardous
waste from the prior handler.
    For the witnessed signature approach, EPA will require a witness's
certification of the signature to reduce the vulnerability of the PIN
or password to compromise. Signature witnessing will take place as
follows. First, the waste handler signing the manifest will present
their government-issued photographic identification (e.g., driver's
license, passport, or State-issued photo ID) to the witness. The
witness will be expected to examine the name and picture contained in
the photo identification, and to verify that the claimed identity of
the signer is consistent with the information contained in the driver's
license or other photo identification. To ensure that this identity
check is performed, the system will prompt the witness to enter the
last five digits of the identification number included on the presented
credential (e.g., the last five digits of the signer's driver's license
number) and the witness will certify that this check was done. Second,
EPA will rely upon the live witnessing of the signer's PIN or password
signature act \13\ as the distinct second authentication strengthening
factor. The system will collect the evidence of both the signer's
signature act and the facts attested to in the witness's certification,
and the collection of this evidence is sufficient to satisfy CROMERR
insofar as establishing that each electronic signature was valid at the
time of signature. See 40 CFR 3.2000(b)(5)(i). A signature affixed to
the e-Manifest in the presence of a witness with distinct interests to
the signer is highly unlikely to be compromised, as the signer
understands at the time of signature that the witness could testify
against the signer should the signer later attempt to repudiate his or
her signature. Because of the manner in which the signature witnessing
process is conducted--with direct in-person contacts between the
signatory and the witness at the time of signature, with reliance of
the witness on a government issued identity credential of independent
origin that includes a photo of the signatory, and with the
certification statement of the witness that includes the durable and
objective evidence (the driver's license number fragment)--this
signature witnessing process also satisfies CROMERR's requirement for
identity proofing under 40 CFR 3.2000(b)(5)(vii)(B). In this regard,
while the interests of the generator and transporter in the waste
transaction may be adverse to or distinct from each other rather than a
``disinterested'' relationship, EPA believes that the vetting of the
generator's representative identity by the transporter's representative
with each signature act is no less stringent than the one-time identity
proofing by a disinterested party contemplated by 40 CFR
3.2000(b)(5)(vii)(A).
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    \13\ It is the witnessing of the signature act, and not the
actual PIN or password, that is intended here. Obviously, PINs and
passwords are intended to be secrets, so the signer must not
disclose his or her PIN or password to the witness during the
signature ceremony.
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    EPA believes that the witnessed signature approach can be
implemented without excessive cost or complexity at the sites where
hazardous wastes are shipped and delivered. EPA recommends this
signature process for the first generation e-Manifests, because it does
not depend on any authentication technology that is more sophisticated
than a keypad device for entering the signer's and witness's PINs or
passwords and the signer's license number data.

    EPA believes that the witnessed signature approach to strengthening
a PIN/password signature will be most useful for executing the
electronic signatures of hazardous waste generators. On the other hand,
transporter and designated facility personnel who interact frequently
with e-Manifest should have little difficulty recalling their PINs or
passwords, or supplying the answers to their personal challenge
questions. Thus, the witnessed signature approach we recommend here
could be restricted to the strengthening of generator signatures, while
transporter and designated facility personnel sign electronically with
their PIN/passwords and respond to their personal question challenges
for the 2nd authenticating factor.
    When restricted to generator signatures, the witnessed signature
approach would operate in the following manner. At the time of a
hazardous waste pick-up by the initial transporter at a generator's
site, the generator's representative would produce his or her
government-issued picture ID (e.g., driver's license) to establish his
or her identity to the transporter representative's satisfaction. The
transporter's representative would check the license or other
credential to ascertain that the identity claimed by the generator's
representative is consistent with the presented credential. The
generator and the initial transporter would then each sign the e-
Manifest with their respective PINs or passwords in the other's
presence. When the generator signs the generator's certification on the
e-Manifest, the generator is merely completing the normal generator's/
offeror's certification statements. When the initial transporter's
representative signs with his or her PIN/password, the transporter
representative's PIN/password signature both acknowledges the receipt
of the hazardous waste from the generator, and certifies to witnessing
the generator's signature, to checking the generator's identification,
and to entering the last 5 digits of the generator representative's
license number or other credential as evidence of the proofing
ceremony. The generator and transporter each sign the electronic
manifest once with their respective PINs or passwords, but the
transporter's PIN/password signature carries the additional
certification language indicating that the transporter vetted the
identity of the generator.
    While the above example would restrict the use of the witnessed
signature approach to generator signatures that are witnessed by
transporters,\14\ it is conceivable that the method could be used for
other waste handler signatures as well. For example, the generator
could similarly certify to witnessing the initial transporter's
signature, and a transporter delivering hazardous waste to the
designated facility could witness the signature of the designated
facility using the same type of credential vetting and certification
approach described above for the generator's signature. The witness in
each case shall also enter the last 5 digits of the signatory's
driver's license number (or other credential number) as a part of the
witness certification. If the identity claimed by the signer is not
consistent with the identification credential produced by the signer,
the witness should not certify to the witnessing of the signature and
should not participate further in the e-Manifest transaction.
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    \14\ Whether the witnessed signature approach might be used only
in connection with generator signatures or used more extensively is
a system design issue that EPA will determine after consultations
with stakeholders and the IT contractor(s) developing the system.
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    To support the witnessed signature approach and its required
certifications, the e-Manifest system's electronic signature module
would be designed to prompt witnesses for the certifications and to
collect the necessary certifications and license (or other credential)
number data independently of the manifest form elements. The advantage
to this is that the e-Manifest format would not itself need to be
revised to accommodate this approach, and the same e-Manifest format
that is supplied for e-Manifests signed with the digitized signature
method or other e-signature methods could be used for PIN and password
signatures.
    EPA generally believes that the witnessed signature approach to
PIN/password signatures will be more practical for the manifest user
community to implement in a first generation system than other
available technology-based second factor approaches that we have
evaluated. We have also determined this signature method to be CROMERR-
compliant, and we believe that this method can be implemented in a
manner that is inexpensive and not excessively burdensome for the
manifest users.
    EPA emphasizes that the electronic signature methods described here
for the first generation e-Manifest system are not intended to preclude
consideration of other electronic signature approaches that are CROMERR
compliant, nor is the description in this preamble of the witnessed
signature approach intended to rule out other CROMERR compliant
approaches for implementing a second authentication factor \15\ for the
PIN or password signatures. The first generation methods described here
are those for which we now have sufficient information \16\ to enable
us to conclude that they are consistent with CROMERR and otherwise
well-suited for the manifest business process.
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    \15\ As authentication technologies mature and become more
mainstream or cost-effective, authentication technologies based on
tokens and biometrics may be found to meet the selection criteria.
    \16\ As discussed previously, we are tentatively concluding that
the digitized handwritten signature method may be CROMERR-compliant
and suitable for e-Manifest, but a final evaluation of this method
will depend on one or more of these products being shown to be
reliable through peer-reviewed studies.
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H. Requirements for Obtaining and Using the Electronic Manifest

    Under the May 2001 proposed rule, EPA proposed to modify existing
Sec.  262.20(a) so that it would present both a paper form option under
proposed Sec.  262.20(a)(2) and an electronic manifest format option
under a new provision that we proposed in Sec.  262.20(a)(3). Under
proposed Sec.  262.20(a)(3), EPA proposed authorizing the use of all
electronic manifests that were: (1) Used in accordance with the
proposed electronic manifest use requirements in proposed Sec.  262.24;
(2) signed in accordance with the proposed electronic signature
requirements in proposed Sec.  262.25; and (3) generated and maintained
on electronic systems which met the proposed security requirements in
proposed Sec.  262.26. If all of these conditions were met, then
proposed Sec.  262.26(a) further clarified that these electronic
manifest copies would be considered the legal equivalent to paper
manifest copies bearing handwritten signatures, for the purposes of
satisfying any of the RCRA regulatory requirements pertaining to
hazardous waste manifests. See 66 FR 28240 at 28304.
    Based on the comments received in response to the May 2001 proposed
rule as well as the comments submitted in response to the April 18,
2006 NODA, EPA is finalizing the provisions of Sec.  262.20(a) to
reflect the changed approach to the electronic manifest that we have
adopted since the May 2001 proposed rule was announced. Thus, in this
final rule, Sec.  262.20(a)(1) imposes a requirement that all off-site
shipments of hazardous waste \17\ must be

accompanied by a manifest, which may be satisfied under Sec.
262.20(a)(2) by preparing and using the current paper forms (EPA Forms
8700-22 and 22A) for the manifest and continuation sheet, or, by
preparing and using the electronic manifest format described in Sec.
262.20(a)(3) of the final rule. Rather than specifying either an EDI
format or an Internet Forms format such as we discussed in Sec.
262.20(a)(3) of the proposed rule, the final rule requires simply that
generators must obtain and complete in accordance with Sec.
262.20(a)(3) the requirements of the electronic manifest format
supplied by EPA's national e-Manifest system that the Agency will
establish and host in accordance with the e-Manifest Act. As discussed
previously in section III.E. of this preamble, EPA currently intends to
develop and maintain a schema and stylesheet in XML (or functional
equivalent) to support the presentation and exchange of manifest data
on the web-based e-Manifest system.
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    \17\ This regulation does not affect or alter existing RCRA
regulatory exemptions from the manifest requirement, e.g., the
exemption for conditionally exempt small quantity generators at 40
CFR 261.5; the exemption for small quantities of hazardous waste
reclaimed under reclamation agreements per 40 CFR 262.20(e); or the
exemption for universal waste shipments in 40 CFR Part 273.
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    Under Sec.  262.20(a)(3) of this final rule, if electronic
manifests are obtained, completed, and transmitted on the national e-
Manifest system in accordance with this section's requirements, and
signed electronically using the ``valid and enforceable electronic
signature'' required under 40 CFR 262.25, then these electronic
manifests shall be considered the legal equivalent of paper manifests
signed with conventional ink signatures. Thus, this final rule
authorizes the use of all electronic manifests that are obtained,
completed, signed, and transmitted through the national e-Manifest
system in accordance with the requirements of Sec.  262.20(a)(3).
Wherever the existing regulations require a manifest to be supplied,
signed, used or carried with a hazardous waste shipment, the execution
of an electronic manifest on the national e-Manifest system shall be
deemed to comply with these requirements to obtain, sign, carry, or
otherwise use the hazardous waste manifest.
    Because electronic manifests will be directly reported to EPA, the
submission of electronic manifests on the national e-Manifest system
are currently governed by the provisions of 40 CFR 3.10, which
addresses direct reporting of environmental information to EPA through
EPA's CDX portal or other system designated by the Administrator.
Therefore, compliance with the 40 CFR 3.10 requirements for direct
electronic reporting to EPA is required under Sec.  262.20(a)(3) of
this final rule as one of the conditions that must be met to obtain and
execute a valid electronic manifest.
    The requirements for direct electronic reporting of compliance
information to EPA were announced in the final CROMERR rule, 70 FR
59848 (October 13, 2005). This rule provides a consistent legal and
policy framework for electronic reporting to EPA under the Agency's
various environmental programs that are codified in Volume 40 of the
Code of Federal Regulations. For all electronic documents that are
submitted directly to EPA, the requirements of CROMERR Sec.  3.10 state
that in order for electronic documents to be considered the legal
equivalent of paper submissions, the electronic document must be
transmitted to the EPA's CDX or other system designated by the
Administrator and bear all valid electronic signatures that are
required. CROMERR also provides that, if the corresponding paper
document is one that must bear a signature under existing regulations,
then the electronic document must bear a ``valid electronic
signature.'' 40 CFR 3.10. We discussed the ``valid electronic
signature'' requirement of CROMERR in the context of our discussion of
electronic signature selection criteria above in section III.G. of this
preamble.
    By providing a consistent, national e-Manifest system that will be
accessed through EPA's CDX electronic reporting portal or other system
designated by the Administrator, EPA is thereby providing a
straightforward means for establishing electronic manifests that will
be the legal equivalent of the current, hand-signed paper manifest
forms. By tying the e-Manifest to the CDX or other system designated by
the Administrator, and by developing this final rule consistently with
the CROMERR legal framework for electronic reporting to EPA, the
requirements for the use of electronic manifests are more
straightforward under this final rule than under the decentralized
approach to the electronic manifest that we proposed in May 2001.
Electronic manifests that are obtained, completed and transmitted in
accordance with Sec.  262.20(a)(3) on the EPA's e-Manifest system, and
that are signed with valid electronic signatures as described in 40 CFR
262.25, are deemed by this rule to be valid manifests for purposes of
RCRA. The primary purpose of this final rule is to clarify that
electronic manifests that are obtained, executed, and signed in this
fashion are authorized for use as legally valid manifests for all RCRA
purposes. While, as explained previously, one printed copy of the
electronic manifest must be carried on the transport vehicle during the
transportation of federally regulated hazardous wastes, the electronic
format is considered a fully equivalent substitute for the use of the
manifest paper forms (EPA Forms 8700-22 and 8700-22A).\18\ The
electronic formats so obtained and completed shall meet all
requirements in RCRA for supplying, completing, signing, sending,
retaining \19\ or otherwise dealing with a hazardous waste manifest. In
particular, electronic manifests supplied and executed on the e-
Manifest system shall be just as admissible as the paper manifest forms
in civil, criminal, or administrative proceedings where manifests may
be offered as evidence.
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    \18\ This statement applies in instances where the electronic
manifest is signed with an electronic signature that has been
determined to be legally valid and enforceable. As discussed in
section G.5.ii. of this preamble, if a signature method is used on
an interim or pilot basis pending testing, a single paper copy of
the manifest will be required to be carried with the shipment to
collect the ink signatures of waste handlers, and to be retained by
designated facilities.
    \19\ This regulation does not address retention of electronic
manifests beyond the 3-year record retention period required of
paper manifests. EPA is aware that some manifest users now choose to
retain manifests for longer periods or indefinitely for a variety of
reasons. When the System Advisory Board is formed, EPA will discuss
with stakeholders if the system should provide extended records
retention or archiving (with an appropriate fee for that service) or
if other extended storage options are available.
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    EPA has included definitions in 40 CFR 260.10 to clarify the
relationship between the electronic manifest and the e-Manifest system
on which electronic manifests are obtained, completed, and transmitted.
The term ``electronic manifest'' (or ``e-Manifest'') refers to the
electronic format of the hazardous waste manifest that is obtained from
EPA's national e-Manifest system, and that is the legal equivalent of
EPA Forms 8700-22 (Manifest) and 8700-22A (Continuation Sheet). The
term ``Electronic Manifest System'' or ``e-Manifest System,'' on the
other hand, refers to EPA's national information technology system
through which the electronic manifest may be obtained, completed,
transmitted and distributed to users of the electronic manifest and to
regulatory agencies.

I. Public Access to Electronic Manifest Data

    1. Introduction. EPA proposed two distinct options in separate
public notices (April 18, 2006, 71 FR 19842 and February 26, 2008, 73
FR 10204) to solicit comments from the public on whether manifests
submitted to the e-Manifest system should be eligible for treatment as
CBI. In the April 18, 2006 public notice and request for comment,

EPA included a general discussion of the Agency's conceptual approach
to the design and operation of the e-Manifest system. We stated that we
would develop the system so that it would support, as far as possible,
the provision of reliable manifest services. We also stated that we
would adopt the necessary measures and controls that were necessary to
comply with EPA and federal policies protecting information security,
privacy, and CBI. 71 FR 19842 at 19847. We also summarized the existing
procedures for submitting and obtaining determinations of CBI claims
under the 40 CFR part 2 regulations. As a part of this discussion, we
suggested further that any CBI claims that might arise in connection
with the e-Manifest system would need to be asserted at the time of the
submission of the electronic manifest to the system, or the claim would
be waived. Id. At 19847-19848. At the time we issued the April 2006
public notice, we believed that it was appropriate to plan for the
consideration of any CBI claims for manifest data within the context of
the 40 CFR part 2 procedures, as well as the more specific provision
applicable to RCRA information at 40 CFR 260.2(b). The Sec.  260.2(b)
regulation provides that CBI claims respecting information required
under the Subtitle C hazardous waste regulations will be addressed in
accordance with the Part 2 standards and procedures, and further
requires that a RCRA CBI claim must be made at the time of submission
of the information to EPA, or the claim will be waived.
    EPA received several public comments on the CBI related statements
contained in the April 2006 NODA. A state-agency commenter presented
the view that nothing in the e-Manifest system should be allowed to be
withheld from public disclosure as CBI, since the manifest is on its
face a document that is shared with and viewed by several entities in
its normal use. On the other hand, a large waste disposal and treatment
company and a trade association of hazardous waste treaters and
disposers offered comments supporting the view that some manifest data
might be claimed as CBI. These commenters were especially interested in
protecting customer information from being mined from electronic
manifests by competitors. The industry members commenting in April 2006
seemed to be most concerned that the availability of this information
electronically would enable competitors to obtain more immediate and
efficient access to their customer information.
    Because of continuing questions that had been raised regarding the
handling of manifest data, and whether these data should be entitled to
CBI protection, the Agency requested further comment on public access
and competitive harm issues in a NODA and request for comment that was
published in the Federal Register on February 26, 2008. EPA explained
that it had evaluated the public access/CBI issue more closely as it
prepared for the development of the e-Manifest system, and announced
that it had determined to categorically exclude individual hazardous
waste manifests from CBI coverage. The effect of the new policy is that
EPA made a categorical determination that it would not accept any CBI
claims that might be asserted in the future in connection with the
processing, using, or retaining of individual paper or electronic
manifests.
    EPA announced its proposed decision to establish a new categorical
policy for addressing CBI claims for individual hazardous waste
manifests for a couple of reasons. First, the public notice explained
EPA's belief that any CBI claim that might be asserted with respect to
individual manifest records would be extremely difficult to sustain
under the substantive CBI criteria. 40 CFR part 2, Subpart B, and 40
CFR 260.2. We stated that as manifests are shared with several
commercial entities while they are being processed and used, a business
concerned with protecting its commercial information would find it
exceedingly difficult to protect its individual manifest records from
disclosure by all the other persons who come into contact with its
manifests. 73 FR 10204 at 10208. Second, we explained that much of the
information that might be claimed by industry commenters to be CBI is
already available to the public from a number of government and other
legitimate sources, because a large number of states now require the
submission of generator and/or TSDF copies of manifests to state data
systems, and the data from these manifests are often made publicly
available through state Web sites or reported and disclosed freely in
federal and state information systems. For these reasons, among others,
we stated that manifest records and data contained in them should not
be subject to CBI claims, as the information is to a significant extent
available from other sources.
    The February 2008 NODA also acknowledged that the waste management
industry was concerned that the aggregation of manifest records and
data contained in them in one national system may enable competitors to
obtain more immediate and efficient access to their customer
information, and thus, potentially create competitive consequences not
experienced under the current paper system. The public notice further
stated that we had little information available at that time on whether
states have generally withheld or disclosed aggregate data, as
information provided previously by the states did not disclose any
pattern of states withholding or releasing such data. Therefore, the
public notice also requested comment on whether aggregate manifest data
requests should similarly be categorically excluded from CBI coverage,
or, whether aggregate data requests merited special handling (e.g.,
redacting information), because of the possible efficiency with which
aggregate data might be mined for competitive purposes from the
national system. In addition, we specifically requested comment from
the waste management industry on how substantial the harm would be to
companies' competitive position if aggregate data were released in
response to a FOIA request. 73 FR 10204 at 10209.
    2. Comment Analysis. State and waste industry commenters generally
agreed with EPA's position that CBI protections would not apply to
requests for individual manifests, since an individual manifest could
not itself disclose a customer list. However, there was strong
disagreement between the industry and state commenters on whether to
apply CBI protection to aggregate manifests or data compilations
developed by querying the system.
    Several state commenters indicated their general support for the
position that aggregate manifest data should not be protected as CBI.
The states with manifest tracking programs tend to freely disclose
their manifest data to the public. One such commenter (NYDEC) indicated
that it does not and never has honored CBI claims for manifest
information. The commenter stated that manifest data should not be
eligible for treatment as CBI, whether the data are submitted on paper
or electronically. Another state commenter emphasized in its comments
that anyone with relational database experience could already generate
significant customer list information by downloading RCRA biennial
report files that are now available from EPA, and by examining shipment
data reported through the biennial report by large quantity generators.
    Another commenter representing State governments (The Association
of State and Territorial Solid Waste Management Officials or ASTSWMO)
stated that, based on information that it has collected, most States do
not honor

CBI claims for manifest information. The commenter stated that most
states it contacted have indicated that they do not afford CBI
protection to either individual manifests or aggregated data, and these
states thus believe that neither individual nor aggregate manifest data
should be subject to CBI protection under our federal policy. Another
state agency commenter (MIDEQ) also stated its agreement with the
policy that neither individual nor aggregate manifest data may be
claimed as CBI. The commenter indicated that this state does not honor
CBI claims for any manifest information. However, one state agency
(Ohio EPA) indicated that manifest data probably would be subject to
CBI protection in that state. The State indicated that, based on the
fact that most of its facilities currently claim business
confidentiality for their similar customer identification information
submitted with these facilities' hazardous waste annual reports, it is
expected that they would likewise claim CBI protection for their
manifest submissions to Ohio.
    Industry commenters generally did not support a categorical policy
that would exclude aggregate manifest data from CBI protection. A trade
association for the waste industry (The Environmental Technology
Council or ETC) explained that the ability to efficiently aggregate
manifest data through the e-Manifest system would pose significantly
different concerns relative to the more substantial effort required to
assemble a customer list under the current paper-based system. The
commenter emphasized that the creation of a useful customer list from
the existing paper manifests is exceedingly expensive and time
consuming, and that the information that could be obtained under the
paper system would be incomplete and of significantly less value than
the aggregated data that could possibly be obtained through querying a
nationwide e-Manifest system. A competitor able to obtain this
information at minimal expense could obtain an unfair competitive
advantage.\20\ For this reason, these industry commenters supported the
idea of EPA redacting customer information before disclosing aggregate
manifest information pursuant to a FOIA request.
---------------------------------------------------------------------------

    \20\ In a subsequent clarifying comment, the ETC attempted to
quantify the harm that would result, by asserting that if just 1% of
a large member company's business were lost to competitors, the
resulting financial loss could be in the range of $7 million to $9
million.
---------------------------------------------------------------------------

    The commenter also stated that all of its member companies
currently treat customer lists as ``valuable and confidential''
information within the meaning of FOIA and that courts have generally
assumed great competitive harm would result from their disclosure.\21\
In addition, the commenter disagreed with the Agency's suggestion that
requesters could obtain much of this aggregated manifest data from
those states that have adopted less protective CBI interpretations,
arguing that some states (e.g., CA) have specific statutory protections
for customer lists, and that state courts have been more protective of
such business information.
---------------------------------------------------------------------------

    \21\ Greenberg v. FDA, 775 F.2d 1169.
---------------------------------------------------------------------------

    Finally, a Federal sector generator (the Department of the Navy)
raised another concern based on anti-terrorism and security
considerations, that is, that the ability to data-mine the e-Manifest
system might pose opportunities to obtain information on the types and
locations of hazardous wastes.
    3. Legal Authority and States' Experience With Handling Manifest
Data. In this section of the preamble, EPA will first summarize the
existing authorities and procedures that govern CBI under federal law.
We will summarize as well how manifest records have been handled for
more than 20 years by the states, which have had significant
involvement with collecting manifest records and applying their records
laws over the years to the collection of many millions of manifest
records.
    i. Legal Authority. The Federal Freedom of Information Act, 5
U.S.C. 552(a), section 3007(b) of RCRA, and EPA regulations
implementing the Freedom of Information Act and RCRA section 3007(b)
generally mandate the disclosure to the public of information and
records in the possession of government agencies. However, there are
nine categories of information that may be exempt from disclosure, and
one such category of information (Exemption 4) is for ``trade secrets
and commercial or financial information obtained from a person and
privileged or confidential.'' 5 U.S.C. 552(b)(4). EPA has adopted
regulations at 40 CFR part 2, Subpart B, to address the handling of
claims respecting the confidentiality of business information.
    Under these statutes and regulations, ``business information''
means information which pertains to the interests of a business, was
acquired or developed by the business, and which is possessed by EPA in
a recorded form. 40 CFR 2.201(c). Such business information may be
claimed by an ``affected business'' to be entitled to treatment as CBI
if the business information is a ``trade secret'' or other type of
proprietary information which produces business or competitive
advantages for the business, such that the business has a legally
protected right to limit the use of the information or its disclosure
to others. Id. at Sec.  2.201(e).
    Under 40 CFR 2.204 and 2.205, there are procedures specified for
EPA to develop interim and final determinations to resolve CBI claims
submitted by affected businesses. The interim and final confidentiality
determinations are governed by the substantive criteria in 40 CFR
2.208. Pursuant to Sec.  2.208, EPA must find that the business
information that is the subject of a claim is entitled to CBI treatment
if:

    a. The claim has not been withdrawn or waived;
    b. The business has satisfactorily shown that it has taken
reasonable measures to protect the confidentiality of the
information, and that it intends to continue to take such measures;
    c. The information is not, and has not been, reasonably
obtainable without the business's consent by other persons (other
than governmental bodies) by use of legitimate means; and
    d. No statute specifically requires disclosure of the
information and the business has satisfactorily shown that
disclosure of the information is likely to cause substantial harm to
the business's competitive position.

    ii. States' Experience With Manifest Records. RCRA-authorized
states with manifest collection and tracking programs have had much
more experience than EPA in addressing the public availability of
manifests. Based on information developed from a survey of state
programs conducted by ASTSWMO, and other available information, it
appears that the 20 or more states with manifest collection and
tracking programs generally treat manifests as publicly available
records. Some states have broad public records laws that mandate the
availability of all manifest records, while other states have public
records laws with CBI provisions similar to the federal authorities
discussed above. Of the nine states that responded to the ASTSWMO
survey, only one state (Ohio) opined that waste facilities in that
state might be expected to claim CBI for manifest submissions, as
several TSDFs in the state had asserted CBI claims with respect to
similar data submitted as a part of the state's Hazardous Waste Annual
Report. A second state stated that although it does not now collect
manifests, if it were to obtain these records and there were CBI claims
involved, it would refer these confidentiality claims to the state's
legal office for resolution of the claim.

    The remaining seven states that responded to the ASTSWMO survey
explained that manifest records would not qualify for CBI treatment
under their states' public records laws. Several of these states make
their manifest records freely available on state Web sites or by
compact disk to anyone who requests them. These methods of fairly
general public disclosure have not generated significant controversy
among the waste facilities doing business in these states. Other states
explained that because manifests are by their nature shared with
numerous commercial entities and perhaps emergency responders while
they are being completed and used, it would be extremely difficult to
protect the confidentiality of the data, and, therefore, difficult to
sustain a CBI claim. Similarly, several states in their ASTSWMO survey
responses emphasized that manifest records and data can be obtained
quite readily from a variety of legitimate means, including requests to
other states, or by accessing summary data available from state or
federal hazardous waste information systems.
    In 2008, we requested clarifications from the five states (IL, MI,
NJ, NY, and OH) that commented previously to either the April 2006 NODA
or the February 2008 NODA. Although we received a number of comments
from state regulatory agencies, the previously submitted state comments
did not differentiate clearly between individual manifests and
aggregate data when discussing state policies. Thus, we could not
ascertain whether the states which stated that they generally released
manifests upon request were also releasing aggregate manifest data upon
request. The purpose of the 2008 comment clarification was to flesh out
better whether these states are: (1) Already releasing aggregate
manifest data in response to public requests; or (2) imposing any CBI
related limitations on the information they will disclose in response
to such a request. We also asked these states to explain whether they
allow CBI claims for information submitted for the states' hazardous
waste reports, because we are aware that a previous state survey had
indicated that some states allow CBI claims for their Hazardous Waste
Reports.\22\ Since similar information linking waste management firms
and their generator customers could be made available from both the
states' Hazardous Waste Reporting systems and from their manifest data
systems, one would expect consistent policies regarding CBI coverage
for customer information.
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    \22\ In August 2004, an official with the Ohio EPA surveyed the
states on their Site ID, manifest tracking, and Hazardous Waste
Reporting requirements. As part of the 2004 survey, 44 States
responded to the question ``Do you allow CBI claims on the Hazardous
Waste Report?'' The responses to this question from the 44
respondents was evenly split between states that would allow and
states that would not allow CBI claims for their Hazardous Waste
Report data.
---------------------------------------------------------------------------

    Based on the requested clarifications, two states (NJ and NY) may
directly or indirectly make aggregate data available to the public upon
request. The New Jersey Department of Environmental Protection (NJDEP)
makes aggregated data available for a fee, unless the requestor
downloads the data from their public internet Web site. The NJDEP does
not impose any CBI related limitations on the information they disclose
in response to public requests for aggregate data. The New York
Department of Environmental Conservation (NYDEC) makes manifest data
available in text format on their department Web site. If manifest
information can be queried from their state database system, then it is
provided for a fee to the requestor of the queried information. The
Michigan Department of Environmental Equality (MIDEQ) does not conduct
queries to generate aggregate lists for FOIA requestors. Manifest data,
however, is available on a MIDEQ public internet Web site, but not in a
manner to easily produce aggregate lists. The other two states (IL and
OH) do not provide hazardous waste manifest record data to the public
but they do provide hazardous waste report data.
    In the case of Hazardous Waste Report data, four states (IL, MI,
NJ, and NY) generally do not treat any data in these reports as CBI.
The NYDEC has granted CBI claims, however, for certain information
contained in hazardous waste reports, but has never granted a CBI claim
based on manifest data contained in a report. The IL EPA makes manifest
data available through hazardous waste reports, but does not allow CBI
on any of its Hazardous Waste Report data. The OH EPA is the one state
that does allow CBI claims for its Hazardous Waste Annual Reports.
    4. Final Rule Decision for Individual Manifests. Based on the
information now available to EPA, we have concluded that information
contained in individual hazardous waste manifest records, including any
individual electronic manifests that may be submitted and collected
electronically through the e-Manifest system, is essentially public
information and therefore is not eligible under federal law for
treatment as CBI. The effect of this decision is that EPA is making a
categorical determination that it will not accept any CBI claims that
might be asserted in the future in connection with processing, using,
or retaining individual paper or electronic manifests. This decision
will apply prospectively from the effective date of this final rule--
that is, 180 days after the date of publication in the Federal
Register, because the Agency has not previously announced this position
and thus it would be unfair or inappropriate for the Agency to release
such information, particularly for those companies that have previously
made such a claim. Thus, it will not impact any CBI claims or any
determinations made in the past by EPA in resolving manifest-related
CBI claims. Our rationale is explained in the following paragraphs.
    First, we believe that any CBI claim that might be asserted with
respect to individual manifest records would be extremely difficult to
sustain under the substantive CBI criteria of 40 CFR part 2, Subpart B
and of 40 CFR 260.2, because they must be shared with several
commercial entities while they are being processed and used, and must
be made available to emergency responders. A business that still
desires to protect commercial information would find it exceedingly
difficult to protect its individual manifest records from disclosure by
all the other persons who come into contact with its manifests. For
example, a business desiring to protect commercial information in the
manifest context would need to enter into and enforce non-disclosure
agreements or similar legal mechanisms with all its customers and other
third parties and affected interests who might also be named as waste
handlers on its manifests or who otherwise might be expected to come
into contact with its manifests.
    Second, as many states now require the submission of generator and/
or TSDF copies of manifests, and the data from these manifests are
often made publicly available or reported in federal and state
information systems, it is apparent to EPA that many manifest records
and the information on them linking waste management firms and
generators or transporters are already available from a number of
states and other legitimate sources. We did not find any significant
history or record of current state practices withholding individual
manifests from disclosure on account of customer information, with the
narrow exception of a California statute that applies only to certain
state-regulated (not RCRA) wastes and the

disclosure of transporter/customer information.\23\
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    \23\ Hazardous waste transporters that are authorized by CA to
use CA's consolidated manifesting procedures must submit quarterly
reports to the CA EPA Department of Toxic and Substances Control
(DTSC). The consolidated manifesting procedures apply to non-RCRA/CA
hazardous waste or to RCRA hazardous waste that is not subject to
the federal manifest requirements. The CA Health and Safety Code
Sec.  25160(d) prohibits the disclosure of the association between
any specific transporter and specific generator. The list of
generators served by a transporter is deemed to be trade secret and
confidential business information for purposes of Section 25173 and
Section 66260.2 of Title 22 of the California Code of Regulations.
CA freely discloses information from RCRA hazardous waste manifests.
---------------------------------------------------------------------------

    Since the states have had far more experience than EPA with the
collection and disclosure of manifests, EPA is persuaded that the
states' policies in this area are entitled to some deference. Several
state programs now deny CBI treatment to data contained in manifest
records,\24\ while other states have indicated to EPA that they
routinely disclose manifest records to the public. EPA has concluded
that among the States that collect manifest copies, it has been the
general practice among these states for more than 20 years to disclose
manifest data without CBI limitations. Our information on state
practices suggests that free disclosure has been the predominant
practice for dealing with data from individual manifest records among
these states, and there have not been significant objections raised by
members of industry to those states' disclosure practices. EPA is not
persuaded that it should reverse this long-standing policy among those
states by adopting a Federal policy that conflicts with the prevailing
state laws and policies on this issue.
---------------------------------------------------------------------------

    \24\ In January of 2007, the MI state representative on EPA's E-
Manifest Final Rule Work Group disseminated a survey on behalf of
ASTSWMO, through the Hazardous Waste Program Operations Task Force,
to interested states in order to request information about their
state manifest requirements, including the requirements for public
access/CBI to manifest records. Eight states responded on how they
currently treat or might treat manifest data as CBI. Responses from
the eight states are as follows: One state (NY) denies CBI treatment
to manifest records; One state (OH) allows TSDFs to claim CBI on
their annual waste report; Four states (ID, OR, SC, CT) do not give
CBI treatment to manifest data reported on quarterly or annual
reports; and Two states (FL, MI) indicate that they would not give
manifest data CBI treatment. In addition, three states (MD, NJ, PA)
that participated on the regulatory work group, but were not
included in the ASTSWMO survey, indicated that their state would not
treat any manifest data as CBI.
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    Finally, we note that the comments submitted by members of the
regulated industry in response to the February 2008 notice generally
conceded the point that individual manifests and the data included in
them should not be the subject of CBI claims. These commenters agreed
that individual hazardous waste manifests are basically treated as
public information.
    For these reasons, we believe that individual manifest records and
the data contained in them should not be subject to CBI claims, since
they are not entitled to protection as CBI in nearly all states that
collect hazardous waste manifests. Since many manifests are available
to the public without restriction in a significant number of states,
EPA has determined that data from individual manifests cannot be
claimed to be confidential under Federal information law. Therefore, we
have codified in 40 CFR section 260.2(c)(1) this categorical policy
that the data included in individual hazardous waste manifests cannot
be the subject of CBI claims. This policy will apply prospectively to
electronic and paper manifests, and to domestic and transboundary
shipment manifests.
    5. Final Rule Decision With Respect to Aggregate Manifest Data. As
mentioned previously, industry and state commenters did not agree on
the CBI policy that should apply to aggregate manifest data. While we
understand industry's comments and concerns regarding the potential
harm to a company's competitive position if aggregate data from
multiple manifests could be obtained efficiently from EPA through the
system or under a FOIA request, we are not persuaded by the comments
that EPA should treat aggregate manifest data obtained from the system
as confidential business information. The e-Manifest system is being
developed so that electronic manifests and data are available to the
authorized states at the same time they are available to EPA. We now
understand from state comments and from state responses to surveys and
requests for clarification that among the states that collect and track
manifests, the policy of many of these states is not to recognize any
CBI claims when processing requests from the public for aggregate
manifest or waste receipt data. We identified some 21 states from
questions or surveys addressing state policies with respect to
processing requests for data from both state manifest tracking systems
and state waste receipt information managed in the states' annual
report data systems. Thus, a large amount of aggregate information,
including information on facilities and their generator customers,
would be available from many of these 21 states without CBI
restrictions. These states' disclosure policies will still apply after
states begin to acquire their manifest data from the e-Manifest system.
Since a substantial amount of aggregate data could be obtained by the
public through these states, EPA is not convinced that it should accord
such information confidential status under federal information law.
    We would also note that EPA cannot objectively determine whether a
particular system search or FOIA request would entail the disclosure of
a company's customer list. EPA requested comment in the February 2008
notice to help us determine how many manifests or how much aggregate
information should be involved in a search or an aggregate record
before CBI concerns would be triggered. We received no comments to help
us with this determination, other than comments from industry relying
on a ``mosaic'' theory to support their argument that the e-Manifest
system could disclose CBI. The mosaic theory is premised on the notion
that information already available to a requestor, when combined with
information it might obtain from the government, may in total amount to
a customer list. The problem posed by this argument is that EPA cannot
possibly know how much customer information a particular requestor
already has available from other sources, or whether a relatively small
or large amount of additional information is needed from e-Manifest to
enable that requestor to assemble a full customer list. The mosaic
theory does not provide EPA with any practical or objective basis for
recognizing CBI in the e-Manifest system.
    As we explain above--the states' current and long-standing policies
generally favoring disclosure of all manifest data, the availability of
much of this aggregate information from State data systems and the RCRA
Biennial Report, and the difficulty of identifying objectively when a
customer list would be disclosed to a competitor--do not support the
policy of treating aggregated manifest data as CBI in the manner
advocated by the regulated industry. Therefore, our final rule decision
is to categorically exclude aggregate manifest data obtained from the
e-Manifest system from CBI coverage.
    While EPA is categorically denying CBI treatment to both individual
manifests and to aggregate manifest collections or reports obtained in
response to data queries or FOIA requests involving manifest data, EPA
recognizes that manifest information in its possession may not be ready
for general release to the public. Manifest preparers and waste
handlers responding to manifests need sufficient time to address
discrepancies or exceptions related to hazardous waste shipments and to
verify and correct data

recorded on their manifests. Until such time as these corrections can
be made and manifest data can be verified and finalized, manifest data
will be considered ``in process.'' To that end, unless otherwise
required by federal law, we are extending the amount of time that
manifest data will be considered ``in process.'' EPA will make manifest
information in e-Manifest available on-line 90 days from the date
hazardous waste is delivered to the designated facility.
    EPA indicated in our prior notices that it would not directly
disclose manifest data that are ``in process'' or unverified to other
manifest users or to other members of the public. We indicated that
live or in process manifests would only be accessible by those waste
handlers named on the manifests, as well as by regulators and emergency
responders. We also proposed in the February 2008 notice that we would
not directly disclose manifest data to the public for at least 60 days
after the start of a waste shipment, as this period would provide the
necessary time for the shipment to be delivered, for exceptions and
discrepancies to be resolved, and for manifest data to be verified or
corrected. 73 FR 10204 at 10209 (February 26, 2008). Commenters on this
proposal noted that 60 days may not be a sufficient amount of time in
several instances for manifest data to be verified and corrected. These
commenters stated that it could take several months for manifest data
to be verified and corrected, and one commenter noted delivered wastes
may be stored for as long as a year under the RCRA Land Disposal
Restrictions before the containers are opened and the wastes are
verified before treatment. We also received comments indicating that
there are hazardous waste shipments that could pose national security
concerns if shipment information were to be made directly available to
the general public during transportation and this information were to
fall into the hands of those who might use these materials to do harm
to other persons or to the homeland.
    Thus, in response to comments stating that our proposed 60-day time
period for verification and correction of in process or incomplete
manifest data was insufficient, and to respond to comments addressing
the security concerns with waste shipments that are in process, we are
adopting in this final rule our decision to amend 40 CFR 260.2(c)(2) to
state that manifests are considered to be in process and subject to
correction and verification for a period of 90 days.
    This 90-day period for correction and verification of waste
shipment information will be measured from the date of receipt of the
waste by the designated facility, rather than from the date of the
start of transportation. Until this 90-day period has passed, unless
otherwise required by federal law, manifests are not considered
complete and final documents and will not be disclosed directly to the
public via on-line access to the e-Manifest system. During this period
of restricted direct, on-line access to manifest data, the manifest
information in the system will be fully available to regulators and to
emergency responders. These in process manifests would also be
available to local governments or police agencies that have been
delegated inspection or program implementation responsibilities by
their States. Hazardous waste handlers will also have direct access to
those manifests on which they appear as the named handlers of waste
shipments.
    Therefore, this final regulation announces a 90-day period measured
from the date of receipt of hazardous waste shipments by the designated
facility during which only regulators, emergency responders, and the
waste handler entities named on particular manifests will have direct
on-line access to manifest data. EPA will not provide the general
public with direct, on-line access to these data during this 90-day
period, but will make such information available to the public to the
extent required by other Federal law, e.g., the Freedom of Information
Act or FOIA. After the 90-day period of restricted access has passed,
the Agency intends to provide full direct, on-line access by the public
to all manifest data in the system.
    EPA emphasizes that the policy reflected in this regulation of
restricting access to data for 90 days from the date of receipt of
waste by the designated facility is limited to EPA in its role as the
federal custodian of data in the e-Manifest system data repository.
Since authorized states will receive electronic manifests and data
simultaneously with EPA, this federal policy does not affect the
states' policies on disclosure of manifest data under their public
information laws. States that wish, for example, to disclose manifest
data to the public more immediately after the receipt of hazardous
waste shipments are free to do so under their public information laws,
and these states may continue to do so once this regulation is in
effect.

J. Will electronic manifests be optional or mandatory for users?

    1. Background. In the April 18, 2006 NODA in which EPA announced
that a national e-Manifest system was the preferred regulatory option,
the Agency solicited comments on whether the use of the e-Manifest
system should be mandatory.\25\ 71 FR 19842 at 19845. We heard a number
of users at the 2004 stakeholder meeting urge EPA to develop an
electronic manifest as an optional tracking tool for manifest users,
while maintaining a paper option for some small businesses that may not
have the economic incentive to invest in electronic manifest
capabilities. While EPA will procure the applications and IT services
to support electronic manifesting on the CDX and Exchange Network
architecture (or other appropriate system), EPA understands that
manifest users will still need to make initial investments--to provide
or acquire the computers or portable front-end devices and network
access for entering data to the e-Manifest system, to integrate the e-
Manifest system with their existing data systems, etc.--before they can
leverage the savings that will arise from electronic manifesting. Large
volume users of manifests will likely realize the greatest net savings
and therefore possess the greatest incentives to be early adopters of
the e-Manifest system. Moreover, we anticipate that the larger
transporters and waste management facilities (RCRA TSDF firms) would be
the entities most likely to participate in the initial phases of e-
Manifest system implementation, and that these larger entities will
likely bring the portable technology to many of the small businesses
and generator sites that they service as their customers. EPA expects
that electronic manifest use will increase over time, and that users
will be motivated primarily by the economic savings and convenience of
electronic submission. Additionally, as more users join the e-manifest
system the cost of maintaining a paper system will fall on a smaller
and smaller group of paper users, likely resulting in ever-increasing
fees for paper submissions.
---------------------------------------------------------------------------

    \25\ EPA solicited comment on this issue before the enactment of
the statute, which provides that the use of electronic manifests be
at the election of the user. We believe it is appropriate to discuss
the comments received on this issue, and our responses to those
comments in this section.
---------------------------------------------------------------------------

    On the other hand, EPA has also heard views expressed by some that
it would be advantageous to mandate the use of electronic manifests. A
mandatory electronic manifest may create a more certain environment for
the IT vendors that choose to bid on the

e-Manifest system procurement, and it would eliminate the concern among
some state officials that an elective electronic manifest would result
in disparate systems, in which some manifest data are received
electronically through the e-Manifest system, while the remainder of
manifest data would still exist on paper forms and would need to be
processed manually. This would increase the cost of operating the E-
manifest system. Further, there is much merit to the point that a
mandatory electronic manifest will expedite and maximize the
realization of economic savings and other benefits that will result
from electronic manifesting. Clearly, if the electronic manifest were
mandatory, it would be much easier to integrate manifest and RCRA
biennial reporting, as the collection of electronic manifest data could
replace the current process under which a separate set of Waste Receipt
forms are collected from RCRA TSDFs for the biennial report. Therefore,
we solicited comment on the merits of a mandatory versus optional
electronic manifest.
    2. Comment Analysis. EPA received a number of comments from the
regulated community and from authorized state agencies on the issue of
an optional versus mandatory electronic manifest. Among the regulated
community commenters, we received 10 comments addressing this point.
Nine of the ten industry comments favored an optional E-Manifest system
for users, although three of these comments suggested that EPA might
consider moving to a mandatory system after two to three years. Only
one industry commenter recommended without qualification that the use
of electronic manifests should be mandatory for all users.
    Among the industry comments favoring retaining the paper manifests,
the points frequently raised in these comments were: (1) Small
generators would lack the computer resources and would find that the
needed IT investments would not be outweighed by cost savings, (2) the
paper option would be a useful backup in the event the electronic
system went down, (3) users might want to pull out of the e-Manifest
system should they find the electronic manifest fees to be
unreasonable, (4) the elective nature of the electronic system would
incentivize the IT vendor to develop the best e-Manifest system at the
lowest cost, and (5) the view that some companies may choose to
continue to use paper manifests out of concern for information security
issues and data confidentiality issues with the electronic system. The
commenters who advocated a transition to mandatory use after two or
three years supported their position with the comments that a two to
three year period of optional use would give users time to prepare for
the electronic system and for the system to prove itself. Such an
approach would also signal that the program would not require the costs
and implementation issues from a dual paper and electronic system to be
borne permanently.
    Among state-agency commenters on the April 18, 2006 NODA, there was
more of a split of opinions on the question of whether the use of
electronic manifests should be optional or mandatory. Of nine states
that commented on this issue, five commented without qualification that
users should be able to choose filing an electronic manifest, primarily
on account of the burden that these state commenters perceived would
fall unreasonably on small businesses if the system use were mandatory.
Only one state agency commented unequivocally that e-Manifest system
use should be mandatory for all users, so that RCRA regulators could
avoid having to maintain dual tracking systems to host the electronic
and paper form data, which is more expensive. On the other hand, three
other states argued for a targeted approach to mandating e-Manifest
system use. For example, one state asserted in its comments that
designated facilities (waste receiving facilities) should be required
to submit data electronically for all the waste they receive. This
comment and similar comments from states favoring mandatory use of the
e-Manifest system were more focused on mandating electronic reporting
of waste receipt data by designated facilities than on the more
specific issue of whether the use of the e-Manifest system should be
mandatory for originating electronic manifests and tracking waste
shipments electronically on a cradle-to-grave basis. On a somewhat
different note, another state maintained in its comments that
designated facilities should be required to use the e-Manifest system
for shipments they receive from conditionally exempt small quantity
generators (CESQGs). Still, another state with a large generator base
and substantial experience with its current electronic data reporting
system suggested a similar targeted requirement that would focus
mandatory e-Manifest system use on large quantity generators (LQGs) or
other targeted audience, unless excused for good cause, while allowing
others to choose to use the e-Manifest system.
    3. EPA Decision on Optional vs. Mandatory Use. EPA is committed to
moving toward full electronic reporting. EPA is persuaded by the points
raised by the majority of commenters who supported the position that
users should be able to choose the electronic manifest as the expected
means of tracking hazardous waste shipments, while also allowing
facilities the chance to opt out of the electronic manifest system and
submit paper manifests. EPA will seek to transition to a full
electronic system. EPA will accommodate the concerns of these
commenters raised in 2006 and currently allow paper submissions as this
electronic transition is underway. Congress provided EPA the authority
in the e-Manifest Act [2(g)(1)(B)] to include requirements that EPA
determines are necessary to facilitate the transition from the use of
paper manifests to the use of electronic manifests, or to accommodate
the processing of data from paper manifests in the electronic manifest
system. Under this authority EPA will move toward its goal of a fully
electronic system but allow for a period of transition to accommodate
paper users who opt out of an electronic filing. Significantly, this
rule establishes the legal and policy framework for the national e-
Manifest system authorized by the e-Manifest Establishment Act. This
rule will allow manifest users to use an electronic hazardous waste
manifest system with a goal of replacing the paper manifest forms. Once
the national e-Manifest system is available, the use of electronic
manifests will be the expected means for tracking hazardous waste
shipments, although the e-Manifest Act and our regulations will allow
users to currently opt out of the electronic manifest and continue to
use the paper forms. We expect the use of electronic manifests will
become the predominant means for tracking hazardous waste shipments. As
we implement e-Manifest, EPA will assess what measures might be
effective to expedite the transition from paper manifests to electronic
manifests, and may take input on fee incentives (e.g., shifting a
greater portion of the system development or operating cost recovery to
paper manifest submissions) or other means to meet this end. Thus, it
is EPA's goal to move to a fully electronic system to maximize the use
of electronic manifests, so that the full benefits and efficiencies of
electronic manifests can be realized as quickly as possible. This
position is consistent with Sec.  2(a)(5)(B) of the e-Manifest Act,
which directs that the use of the electronic manifest system to obtain
electronic manifest formats shall be at the election of the users. EPA
agrees that there may be some businesses, particularly, small

businesses, that initially will not have the willingness or economic
incentive to participate in the e-Manifest system. Over time though,
paper based reporting will become less economical particularly with the
potentially higher user fees associated with the processing of paper
manifests. While many small businesses may be able to participate in
the e-Manifest system through the efforts of the transporters or
designated facilities with whom they contract for transportation or
disposal services, this outcome initially should be influenced by
market factors rather than mandated. EPA agrees that there are some
businesses that interact with the manifest infrequently for tracking
relatively small quantities of hazardous waste. These businesses may
for a time need to continue to use the paper manifest form with which
they are familiar and comfortable. In addition, while EPA agrees that a
complete set of electronic waste receipt data from designated
facilities would be advantageous, we also believe that this objective
can be attained through other means. The proportion of manifests
completed electronically should increase over time through competitive
forces and fee incentives so that the amount of effort expended
collecting and processing paper manifests should become less
significant. As more users join the e-manifest system, the cost of
maintaining a paper system will fall on a smaller and smaller group of
paper users, potentially resulting in ever-increasing fees for paper
submissions.
    As EPA explains below in section III.K of this preamble, upon
implementation of the e-Manifest system, EPA will require TSDFs to
submit one final copy of their remaining paper manifests to EPA rather
than to the authorized states for processing. These paper manifest
copies will be processed centrally and the system operator will enter
the data from these forms into the e-Manifest system. Thus, a complete
set of designated facility data on hazardous waste receipts can be
obtained in this manner without initially mandating a transition to the
use of electronic manifests. The interests of the state commenters in
obtaining a complete set of electronic data will be realized, although
with much less efficiency than with everyone using the electronic
manifests.
    Therefore, as we prepare for the initial implementation of e-
Manifest, this final rule implements the e-manifest as the expected
tracking document for the manifest users in the RCRA regulated
community, while allowing users to opt-out and continue to use the
paper system as necessary. We have codified the definition of ``user of
the electronic manifest'' in 40 CFR section 260.10 consistent with the
definition of ``user'' in the e-Manifest Act, so that it is clear that
users can choose to use the electronic manifest or opt out and continue
to use the paper manifest forms.
    While EPA believes that giving users the choice to use the
electronic manifest format is consistent with the statutory definition
of ``user'' discussed above, the Agency emphasizes that it is our goal
to promote the use of electronic manifests by the user community to the
maximum extent possible. EPA is adopting policies (e.g., the E-
Enterprise Initiative) across its environmental programs that would
establish electronic reporting as the means of submitting reports to
the Agency. Significantly, this rule establishes the legal and policy
framework for the national e-Manifest system authorized by the e-
Manifest Establishment Act. This rule will allow manifest users to use
an electronic hazardous waste manifest system with a goal of replacing
the paper manifest forms. Once the national e-Manifest system is
available, the use of electronic manifests will be the expected means
for tracking hazardous waste shipments, although the e-Manifest Act and
our regulations will allow users to currently opt out of the electronic
manifest and continue to use the paper forms. We expect the use of
electronic manifests will become the predominant means for tracking
hazardous waste shipments. As we implement e-Manifest, EPA will assess
what measures might be effective to expedite the transition from paper
manifests to electronic manifests, and may take input on fee incentives
(e.g., shifting a greater portion of the system development or
operating cost recovery to paper manifest submissions) or other means
to meet this end. Thus, it is EPA's goal to move to a fully electronic
system so as to maximize the use of electronic manifests, so that the
full benefits and efficiencies of electronic manifests can be realized
as quickly as possible.
    In section II.F of this preamble, we summarized the various
economic and non-economic benefits of electronic manifesting, such as
substantial paperwork cost savings and burden reductions for manifest
users and states; the greater accountability that will likely result
from nearly real time tracking capabilities, the much improved data
quality from the manifest creation and editing aids that will be
available in an electronic system; greater inspection and oversight
efficiencies for regulators who can access manifests more readily with
electronic search aids; greater transparency for and empowerment of
communities with more accurate information about completed waste
shipments and management trends; the savings and efficiencies of
consolidating duplicative federal and state waste data reporting
requirements with one-stop reporting, and the possible savings and
efficiencies from integrating manifest and RCRA biennial reporting.
    Witnesses representing the hazardous waste industry commented that
mailing costs, for one company, alone are close to $1 million per year
and EPA estimates that the labor costs alone for creating, handling,
and processing the paper manifests are somewhere between $193 million
and $769 million annually. The witnesses had not made their own
independent estimate of the cost associated with the existing system
but did say: ``we do believe based on our own experience that the
current system is quite labor intensive and, therefore, costly.''
[David R. Case, Executive Director of Environmental Technology Council,
June 21, 2012 before the Subcommittee on Environment and the Economy;
Frederick J. Florjancic, CEO and President of Safety-Kleen, September
28, 2006 Subcommittee on Superfund and Waste Management]. These
benefits should allow users and states to shift resources from data
management activities to those more targeted at their business
activities and at improving waste management and addressing any
noncompliance issues. These shifts in focus will in turn contribute to
increased levels of compliance, greater public awareness of local and
national waste management trends, and a more level playing field for
the regulated community. For the first time in the more than 30 years
of hazardous waste regulation under RCRA, EPA, the States, and the
public will have available a complete set of national data on all
manifested shipments of hazardous waste.
    When EPA originated the manifest program in 1980, it declined to
collect copies of manifests for domestic waste shipments, believing
that the burden of collecting and processing millions of manifests
would overwhelm the Agency. Indeed, witnesses representing the
hazardous waste industry commented that the paperwork burden of paper
manifests is so significant that 22 states currently do not accept
paper manifests [David R. Case, Executive Director of Environmental
Technology Council, June 21, 2012 before the Subcommittee on
Environment and the Economy; Frederick J. Florjancic, CEO and President
of Safety-Kleen,

September 28, 2006 Subcommittee on Superfund and Waste Management] With
the transition to the electronic manifest, EPA will be able to collect
and manage more efficiently the manifests from all the nation's
hazardous waste movements.
    We discuss in more detail the projected qualitative impacts of the
electronic manifest in section VI of this preamble. There will clearly
be substantial cost and burden hour savings as well from e-Manifest,
which EPA will evaluate in more detail when we announce the fee
schedule and implementation date for the e-Manifest system. Any
resulting savings, as well as the non-economic benefits discussed here
for the electronic manifest, would clearly be maximized if the use of
electronic manifests could be promoted and incentivized so that use
approaches 100%.
    EPA will monitor closely the metrics of electronic manifest use
over time. While the electronic manifest is the expected submission
format, as we transition toward full use of electronic manifests, users
will be allowed to opt out and continue to carry and use paper
manifests for tracking their hazardous waste shipments during
transportation, and to submit paper manifests to the system. As
suggested by the e-Manifest Act, we will explore fee-based and other
incentives to promote the greater use of electronic manifests,
particularly among hazardous waste transporters and designated
facilities, as they will likely have the greatest impact on the volume
of electronic manifest use. Moreover, to the extent that paper
manifests continue to be used by some during the course of tracking the
transportation of waste shipments, we will work with the designated
facilities that receive these shipments to ensure that the data from
the paper manifests is reported to the national system in an electronic
data transfer. In this way, we believe that we can accomplish, in a
fairly short time, nearly 100% of manifest data being received by the
system electronically. Initially, by pursuing both objectives--
maximizing electronic manifest use at the front end of the manifest
process and maximizing electronic reporting of data from paper
manifests at the back end of the process--we believe that we can
eliminate the most burdensome aspects of collecting and processing
paper manifests in the system, with the ultimate goal of 100%
electronic manifests.

K. How will remaining paper manifest forms be submitted and processed?

    1. Background. One of the key assumptions underlying the electronic
manifest is that the users of the manifest (i.e., those subject to
manifest requirements), as well as the state regulators who collect and
make use of manifest data, will realize substantial benefits and
paperwork burden reductions as more manifests are completed and
processed electronically. Indeed, the major savings associated with use
of electronic manifests arise when we can eliminate or reduce the steps
of manually completing, carrying, mailing, and filing manifest forms,
as well as eliminating or reducing the steps needed to transpose data
between legacy data systems and paper forms, and the steps needed to
then re-key data from the paper forms back into the companies' or
states' tracking systems after manifests have been finalized.
    Under the approach to electronic manifest use announced in this
rule, it is EPA's goal that over a period of several years, the use of
electronic manifests will become the predominant means of tracking RCRA
hazardous waste shipments. The incidence of paper form use may be
initially greater for state-regulated or non-RCRA wastes subject to the
manifest, as many of the generators of non-RCRA wastes tend to be
smaller generators who may initially let the larger generators begin
use of the e-Manifest systems before trying it or be dependent on the
larger generators providing equipment. As noted above, in the early
years the numbers of paper forms that remain in the manifest system
will surely be greater than as the system matures. One of the outcomes
of maintaining dual electronic and paper manifest submissions is that
this system will be costlier to maintain and may result in higher user
fees. Additionally, as more users choose the electronic manifest, the
cost of maintaining a paper system will fall on a smaller and smaller
group of paper users, potentially resulting in ever-increasing fees for
paper submissions.
    Commenters on the April 2006 NODA emphasized the importance of this
issue. Industry commenters generally supported elective use of
electronic manifests, but they also questioned whether the resulting
dual paper and electronic systems would generate complexity and burden
that would frustrate the transition to electronic manifests and thus
undermine the Agency's and industry's savings projections. State-agency
commenters on the April, 2006 NODA offered strong comments indicating
that their support for electronic manifesting was contingent upon there
being implemented a means to ensure that a complete set of manifest
data would be established. According to these commenters, a centralized
system that did not also contain the data from paper manifests would
not present a complete picture of all RCRA and state regulated wastes.
Such a system would not be useful, for example, for biennial reporting
purposes, and would result in states having to maintain duplicative
processes and systems to collect and track the data from the remaining
paper forms. Thus, both industry and state commenters urged EPA to
develop the final rule so as to mitigate the effects of a dual paper
and electronic manifest system.
    EPA considered several options to reduce the negative impacts of
dual systems. The alternatives we considered were all aimed at
simplifying the process for collecting paper forms, and at ensuring
that the data collected from both electronic manifests and paper forms
could be efficiently processed so that a comprehensive set of manifest
data would be available to users and regulators. One option considered
was for the authorized states to continue to serve as the collection
point for paper manifests, while all electronic manifests would be
collected centrally by the national system and distributed to states
through their Exchange Network nodes or equivalent on the system. In
order to establish a composite set of data, states would then be
required to conduct any quality assurance on the paper form data, key-
in the data according to a specified file format, and then upload the
verified data to EPA at some regular frequency so that it could be
merged with the electronic manifest data collection. While this would
continue the current scope of manifest reporting as defined by current
state copy submission requirements, it would not produce a complete set
of data, as the manifests from states that do not now collect manifests
would be omitted.
    As a second option for addressing the dual systems issue, EPA
considered requiring all manifests now subject to state requirements
for submission of manifest copies to be instead submitted to the e-
Manifest system operator for collection and data processing. Quality
assurance steps and data entry would be conducted consistently by e-
Manifest system personnel, and a fee for this service would be
collected to recover the paper and data processing costs. However, this
option would be as limited as the first option insofar as continuing to
collect only the same scope of generator and designated facility
manifests as are now collected under existing state requirements for
the submission of manifest copies.
    EPA considered still a third option, under which only the
designated facility

would be required to submit to the e-Manifest system its final copy of
the paper manifests that continue in use after implementation of the e-
Manifest system. In addition, the designated facility would pay an
associated user fee for the data processing services performed by the
system. Under this option, generators and transporters would not be
required to submit their copies of paper manifests to the e-Manifest
system. However, state-tracking programs that decide to continue to
collect generator copies of manifests could do so under their state law
requirements, as this option would only affect the collection of the
designated facility copies by EPA. This option would, however, require
the collection of paper manifests from designated facilities in all
states, so, unlike the other two options, this third option would
provide a complete set of paper manifest copies from all designated
facilities.
    2. Solicitation of Comment on Collection of Designated Facility
Copy. Because this third option proposed a new federal record
collection requirement that was not discussed in prior regulatory
documents, EPA presented this option for public comment in the February
2008 NODA.\26\ Comments received by EPA in response to the NODA
discussion of this issue generally supported the proposal to require a
final copy of the manifest (or the data and image from this copy) to be
submitted to the system operator by the designated facility.
---------------------------------------------------------------------------

    \26\ EPA solicited comment on this issue prior to the enactment
of the 2012 statute, which confers on EPA the discretion to require
the collection of a paper copy of the manifest for data processing
purposes. Thus, we are implementing this discretionary authority
with the decision announced here.
---------------------------------------------------------------------------

    3. Final Rule Decision. Based on the comments received, and the
commenters' desire to not have dual manifest systems, EPA has decided
to adopt the approach of the third option for this final rule. This
requirement also implements section 2(g)((1)(B) and section 2(c)(1) of
the e-Manifest Act, which, respectively, confers discretion upon EPA to
promulgate a regulation requiring that users of paper manifests submit
paper copies to the e-Manifest system for data processing purposes, and
authorizes EPA to collect a reasonable fee from users for the costs
incurred in collecting and processing the data from any paper
manifests. Therefore, we are implementing an e-Manifest system that
will be structured so that electronic submissions will be the expected
submission format, but that will allow users during a transition period
to opt out of the electronic system by submitting a paper manifest,
which will be received by the e-Manifest system for data processing
purposes.
    Under today's regulation, the designated facility must send to the
e-Manifest system the top copy (Page 1 of the 6-page set) of the paper
manifest form within 30 days of delivery of the hazardous waste
shipment. The copy could be mailed to the e-Manifest system, or EPA may
authorize the designated facility to transmit an image file to the EPA
system so that the system personnel could key-in the data from the
image files to the data system. Alternatively, the designated facility
may be able to submit both the image file and a file presenting the
manifest data to the system in image file and data file formats
acceptable to the e-Manifest system operator and supported by EPA's
electronic reporting requirements. The data file submission may be
subject to quality assurance checks, and the regulated entity would be
responsible for responding to and correcting errors identified from
this check before a submission is accepted for processing by the e-
Manifest system. This latter alternative could result in much more
timely receipt of the manifest data by the system, and avoid the need
for manual data entry activities by the system operator. EPA is
codifying these requirements for designated facilities to submit final
paper copies or their data at 40 CFR 264.71(a)(2)(v) and
265.71(a)(2)(v).
    For paper copies mailed to the system by designated facilities, the
e-Manifest system operator would create or obtain an image file of each
such manifest, and store it on the system for retrieval by state or
federal regulators. The e-Manifest system operator would also key-in or
extract the federal- and state-regulated waste data from these copies
to the e-Manifest system. EPA could extract any data regarding RCRA
hazardous wastes for inclusion in its data systems, while the states
could pull off data from the system concerning RCRA and state-regulated
wastes for processing in the states' own tracking systems. The
designated facility would be required to pay a fee to the system
operator for processing the data from these final copies of the paper
forms, and the fee would vary with the type of submission (mailed copy,
image file, or image plus data file), as these submission types will
likely present a different level of effort insofar as the processing
steps required to enter the form data into the system. The fees for
these and other e-Manifest system services will be determined later by
EPA, and published in a distinct regulatory document prior to the
implementation of the e-Manifest system.
    EPA believes that this approach provides the most efficient
solution to the dual paper/electronic systems problem during the
transition to an electronic manifest system. It simplifies manifest
copy submission for the designated facilities, which will only need to
provide facility copies or data to one location--the national e-
Manifest system--rather than supply copies to the many state agencies
that now collect manifest copies. Further, it focuses the federal
collection effort on the final designated facility copies of the form,
which provide the best accounting of the quantities and types of wastes
that were actually received for management. By providing a means to
collect a complete set of waste receipts data from RCRA TSDFs (the
merged set of paper and electronic manifest data), it also provides EPA
with the means to modify biennial reporting by TSDFs of waste receipts
data with a much simpler approach that relies upon the designated
facility data reported to the e-Manifest system. As states will be
connected to the e-Manifest system through the Information Exchange
Network or alternate system, they can download the image files or the
data keyed from paper manifests from this central processing service,
just as they will be able to obtain the data and presentations of
electronic manifests from the XML schemas and stylesheets transmitted
on the e-Manifest system. Finally, as EPA will be able to assess
appropriate fees for the paper processing and data entry activities
necessary to process the data from paper forms and enter them into the
e-Manifest system, the actual costs of providing these services will be
recovered. Since we expect that electronic manifests will be much more
efficient to process than paper forms, the differential fees that are
established for paper and electronic manifest processing will likely
operate as an additional incentive for the transition to electronic
manifests.
    Therefore, while EPA is clarifying in this rule that the use of the
electronic manifest format is expected for members of the regulated
community (with the opportunity to opt out), designated facilities will
be required by this final rule to interact with the e-Manifest system,
whether the electronic manifest format or the paper manifest form is
used. EPA's decision to collect the final copy of paper manifest forms
(or their data) from designated facilities and to process centrally the
data from

these paper forms means that these designated facilities will be
required to interact with the e-Manifest system in one of two ways when
submitting their manifests. Facilities that elect to use the electronic
manifest format will submit their electronic manifests to the e-
Manifest system, as the system will be designed for the very purpose of
distributing electronic manifests among the users and regulatory
agencies while the electronic manifests are being obtained, completed,
and transmitted electronically on the e-Manifest system. On the other
hand, facilities that choose to use the paper manifest forms rather
than electronic manifest formats will physically carry and complete the
paper manifest forms in the conventional manner that has been the norm
since the hazardous waste manifest form was introduced in 1984.
However, in lieu of sending a final paper manifest copy directly to the
destination state (when required by the destination state), this final
rule will require the facility to send Copy 1 of all the paper
manifests (or an image and data file) to the EPA's e-Manifest system
operator. Thus, the designated facilities will be required to submit a
final manifest copy to the e-Manifest system, either in a supported
electronic format or as a paper copy, and to pay any associated user
fees. In other words, the use of the electronic manifest format will be
the expected manifest format for tracking hazardous waste shipments,
unless the waste handler chooses to opt out and uses paper manifests
under this final rule. However, with respect to designated facilities
the submission of either a completed paper or electronic manifest to
the EPA system operator will in every case be required. Once this
requirement is effective, and all final copies (electronic or paper)
from designated facilities are being submitted directly to the EPA e-
Manifest system operator, the states will obtain their final manifest
copies and data from the e-Manifest system through their nodes on the
Environmental Information Exchange Network.

L. Can I use e-Manifest if some waste handlers choose not to
participate?

    1. Background. In the May 2001 proposed rule, EPA recognized that
there would be times when an electronic manifest could not be passed to
or executed by all the waste handlers involved in a waste shipment,
because one or more waste handlers might lack the technology or the
capability to participate in the e-Manifest system. In the proposed
rule, EPA suggested that for electronic manifesting to be effective,
the receiving facility (the designated facility) must be able to
receive and process electronic manifests, and that either the generator
or transporters should also have the capability to create and transmit
the electronic manifest. See 66 FR 28240 at 28272.
    In particular, at the time of the proposed rule, EPA was of the
view that electronic manifesting would still be beneficial if at least
the generator and designated facility could exchange manifest and
tracking information, since the manifest data entry, record keeping,
and the very important function of verifying the receipt of wastes (or
reporting discrepancies) between the generator and the designated
facility could still be conducted electronically, as might any
reporting of manifest data by generators or designated facilities to
authorized states. Thus, we discussed in the proposed rule a procedure
whereby the generator and receiving designated facility could conduct
electronic manifest exchanges among themselves and their states, while
allowing any non-participating transporters to continue to sign and
retain a paper copy that would be marked up to show the unique tracking
number assigned to the transaction by the e-Manifest system. Id. The
proposal further suggested that a check box or other notation could be
entered on the electronic manifest to indicate when the transporter
took delivery of the waste, and to indicate that the transporter signed
and retained a paper copy of the manifest. Id.
    Similarly, we discussed what we considered to be a common situation
where individual generator sites would not have their own on-site
technology capability to participate in the e-Manifest system, but
would participate in the e-Manifest system through the portable
technology devices (e.g., a mobile computer) brought to the generator
sites by a transporter or waste management facility participating in
the e-Manifest system. In the latter instance, there would in fact be
participation in the electronic manifest transaction by all the waste
handlers, but the generators themselves would not need to obtain or use
their own equipment in order to engage in electronic manifesting. Id.
at 28273.
    2. Comment Analysis. The proposed rule's discussion of electronic
manifesting procedures for those cases where not all the waste handlers
could participate electronically generated several comments from
members of the regulated community and from state agencies. A commenter
from the steel industry voiced support for this aspect of the proposal,
as it would allow steel industry generators and designated facilities
to begin using electronic manifests promptly, without having to wait
for transporters to participate. Several other industry commenters
stated in their comments that EPA needs to provide additional guidance
to address the cases where transporters cannot participate in the
electronic system. These commenters asked for particular clarification
of such points as: (1) whether generators and designated facilities
would be required to retain paper copies of manifests signed in ink by
non-participating transporters; and (2) how would the electronic
manifest record note that such a transporter's signature is on file and
recorded on a hard copy manifest?
    State commenters joined with the industry commenters that the final
rule should describe more clearly what would be required of waste
handlers or states when one or more waste handlers do not use the
electronic manifest. One state commenter also voiced a strong objection
to the suggestion in the proposal that an electronic copy of a manifest
could be submitted to a state without all the transporter signatures
being included on the electronic manifest.
    3. Final Rule Decision. After considering all the comments and the
manual processing steps that would be required to support the proposed
rule approach, EPA is not adopting the proposed rule approach under
which non-participating transporters could sign and retain paper
manifest copies, while other handlers participated through the
electronic manifest. This final rule instead specifies that the
electronic manifest format can be used for tracking waste shipments
only when it is known at the outset of the waste shipment that all
waste handlers named on the manifest can participate electronically.
Under the final rule, it is of course permissible for generators
lacking their own electronic equipment to participate in the electronic
manifest through use of a transporter's or designated facility's
equipment, and, likewise, a transporter engaged in a waste pickup or
delivery may use a participating generator's or designated facility's
equipment to conduct electronic manifesting. However, if at the outset
it is known that a generator, transporter, or designated facility named
on the manifest cannot or will not participate in the electronic
manifest, then the shipment is ineligible for the electronic manifest,
and the standard paper manifest must be used to track the shipment in
the conventional manner.
    EPA considered an approach whereby non-participating transporters
would be accommodated by requiring the

generator to supply sufficient printouts of the electronic manifest for
all non-participating transporters. We considered specifying in this
rule detailed procedures calling for the various paper copies to be
manually signed and dated by the non-participating transporters. These
procedures would also have required information to be entered on the
paper copies regarding electronic signatures, including the names of
the persons signing the manifest electronically, the date of these
electronic signatures, and the notation ``signed electronically'' in
the paper copies' signature fields. We considered this approach,
because we wanted the paper copies to present a complete log of the
transportation history of the shipment, including the signature
information, so that the entire record of the waste shipment could be
preserved by merging the data from paper copies with the electronic
manifest data for the shipment.
    In the end, however, we decided not to adopt this approach for the
final rule because we concluded that the various manual processing
steps that would be necessary to sustain the tracking process would be
too complex and burdensome to be justified. The manual processing steps
and their burdens would likely exceed any savings that would arise from
the shipment being tracked partially with the electronic manifest. In
order to maintain full accountability for these shipments, it would
have been necessary to supply another paper copy for the designated
facility, so that the facility could forward this copy to the e-
Manifest system for data processing purposes. This approach would have
placed an additional responsibility on the EPA system to manage the
paper copies mailed to the system for processing, and to merge the data
from the paper copy with the electronic manifest record previously
entered into the system. Finally, we identified potential enforcement
issues with this approach, as the complete shipment record would
consist of both electronic and paper components, neither of which could
be relied on by itself for a full accounting of the shipment.
    EPA proposed the partial electronic and manual process for non-
participating waste handlers because we believed that this approach
would enable many more manifests to be initiated electronically in the
system and also would enable designated facilities to verify their
waste receipt data electronically and to transfer the data to EPA and
state data systems. While the effect of this decision is likely to
exclude some waste shipments from being tracked with the electronic
manifest, we believe that the final rule will be much more practical
and straightforward to implement. The Agency prefers to see the
technical barriers to transporters' participation reduced, so that more
transporters will participate in the electronic manifest, rather than
establishing a complex process that may only perpetuate the use of
paper-based tracking procedures by these transporters.
    This final rule requires the use of the paper manifest form in all
instances where it is known at the outset of a waste shipment that one
or more of the waste handlers named on the manifest will not
participate in the electronic manifest, unless one of the parties can
provide access to the electronic manifest system to other parties
involved in the transaction through hand-held or other technology. This
requirement is codified in the generator requirements at 40 CFR
262.24(c).
    However, there may also be instances in which a manifest is
initiated electronically, but a situation develops, after