Economic Analysis for the Final TSCA Section 8(a) Reporting Requirements for Certain Chemical Substances as Nanoscale Materials
                                RIN 2070 - AJ54

Economic Analysis for the Final TSCA Section 8(a) Reporting Requirements for Certain Chemical Substances as Nanoscale Materials
                                RIN 2070 - AJ54

                        -- Does not contain TSCA CBI --

                                  Prepared by
                      Economic and Policy Analysis Branch
           Chemistry, Economics, and Sustainable Strategies Division
                  Office of Pollution, Prevention, and Toxics
                     U.S. Environmental Protection Agency
                           1200 Pennsylvania Avenue
                             Washington, DC 20460

                        -- Does not contain TSCA CBI --

                                  Prepared by
                      Economic and Policy Analysis Branch
           Chemistry, Economics, and Sustainable Strategies Division
                  Office of Pollution, Prevention, and Toxics
                     U.S. Environmental Protection Agency
                           1200 Pennsylvania Avenue
                             Washington, DC 20460

                      This Page Intentionally Left Blank
                                 Contributors

The EPA analysts responsible for this report are Lynne Blake-Hedges of the Economic and Policy Analysis Branch; Chemistry, Economics, and Sustainable Strategies Division; Office of Pollution Prevention and Toxics. Analytical and draft preparation support was provided by Abt Associates Inc. under EPA Contract No. EP-W-16-009.

Table of Contents
Table of Contents	i
List of Tables	iii
Executive Summary	v
Chapter 1  -  Introduction	1-1
1.1	Statutory Authority	1-1
1.2	Regulatory and Programmatic Background	1-1
1.3	Statement of Need	1-3
1.4	Summary of Methodology	1-5
1.5	Organization of This Report	1-5
Chapter 2  -  Affected Entities	2-1
2.1	Chemical Substances Subject to this Rule	2-1
2.2	Manufacturers	2-1
2.3	Processors	2-7
2.4	Total Regulated Firms	2-8
Chapter 3  -  Industry Compliance Costs	3-1
3.1	Wage Rates	3-1
3.2	Unit Industry Compliance Costs	3-1
3.3	Discounting Methods	3-9
3.4	Total Industry Compliance Costs	3-9
Chapter 4  -  Agency Costs	4-1
4.1	Wage Rates	4-1
4.2	Unit Agency Costs	4-1
Chapter 5  -  Total Social Costs and Sensitivity Analyses	5-1
Chapter 6 - Sensitivity Analyses	6-1
6.1	Number of Firms	6-1
6.2	Annual Industry Growth Rate	6-1
6.3	Number of Nanomaterials per Firm	6-6
6.4	Annual Nanomaterials Growth Rate	6-14
6.5	Summary of all Analyses	6-22
Chapter 7  -  Benefits	7-1
7.1	Market Failure	7-1
7.2	Benefits of Information-Based Policies	7-1
7.3	Potential Users of Information Generated by the Rule	7-3
Chapter 8  -  Small Entity Impact Analysis	8-1
8.1	Select a Relevant Small Business Definition	8-1
8.2	Estimate the Number of Small Businesses	8-2
8.3	Estimate the Cost-to-Sales Ratio for Small Companies	8-3
Chapter 9  -  Other Impact Analyses	9-1
9.1	Employment Impact Analysis	9-1
9.2	Paperwork Reduction Act (PRA)	9-5
9.3	Unfunded Mandates Reform Act (UMRA)	9-6
9.4	Executive Order 13132  -  Federalism	9-6
9.5	Executive Order 13175  -  Consultation and Coordination with Indian Tribal Governments	9-6
9.6	Executive Order 13045  -  Children's Health	9-6
9.7	Executive Order 12898  -  Environmental Justice	9-6
9.8	Executive Order 13211  -  Energy Supply, Distribution, or Use	9-7
9.9	National Technology Transfer and Advancement Act	9-7
Appendix A  -  Wage Rate Calculations	A-1
A.1	Derivation of Industry Unit Wage Rates	A-1
A.2	Derivation of Agency Unit Wage Rates	A-2
Appendix B  -  Small Business Sensitivity Analysis	B-1
B.1	Estimation of the number of nanomaterials per small Firm	B-1
B.2	Conclusions	B-1
Appendix C  -  References	C-1
List of Tables
Table 1-1: TSCA-authorized Reporting Requirements	1-1
Table 2-1: Sample Subset Characteristics	2-5
Table 2-2: Estimated Number of Small and Large Manufacturers	2-5
Table 2-3: Estimated Nanomaterials per Manufacturer, with R&D Exclusion	2-7
Table 2-4: Number of Regulated Processors	2-8
Table 2-5: Estimated Number of Regulated Firms	2-8
Table 3-1: Loaded Industry Wage Rates, 2015$	3-1
Table 3-2: Industry One-Time Cost Estimate to Familiarize with the Rule (2015$) (per Firm)	3-2
Table 3-3: Industry Burden Estimate to Complete the Form (per Report)	3-3
Table 3-4: Industry Cost Estimate to Complete the Form (2015$) (Per Report)	3-3
Table 3-5: Industry Cost for CBI Claim Substantiation (2015$) (Average Per Report)	3-5
Table 3-6: Industry Burden and Cost of Electronic Reporting Requirements	3-7
Table 3-7: Industry Burden and Cost of Electronic Reporting Requirements (Subsequent Years, per Firm) (2015$)	3-8
Table 3-8:  Industry Cost Estimate to Maintain Records (2015$) (per Report)	3-8
Table 3-9: Total Annual Burden Hours - Manufacturers	3-10
Table 3-10: Total Annual Burden Hours - Processors	3-10
Table 3-11: Total Annualized Costs - Manufacturers	3-11
Table 3-12: Total Annualized Costs - Processors	3-12
Table 3-13: Total Annualized Industry Costs	3-13
Table 4-1: Loaded EPA Wage Rates, 2015$	4-1
Table 4-2: Agency Cost Estimate to Administer the Rule (per report)	4-2
Table 4-3: Agency Cost and Burden Hour Estimate for the Final Rule	4-3
Table 5-1: Total Social Burden and Cost of the Rule	5-1
Table 6-1: Low- and High-end Estimates of Number of Firms	6-1
Table 6-2: Total Annual Industry Burden Hours (Number of Firms Sensitivity Analysis)	6-1
Table 6-3: Total Annual Industry Cost (Number of Firms Sensitivity Analysis)	6-2
Table 6-4: Total Annual Agency Burden and Cost (Number of Firms Sensitivity Analysis)	6-3
Table 6-5: Total Social Costs (Number of Firms Sensitivity Analysis)	6-4
Table 6-6: Estimated Number of Manufacturer Reports (Increased Annual Growth Rate Sensitivity Analysis)	6-1
Table 6-7: Estimated Number of Processor Reports (Increased Annual Growth Rate Sensitivity Analysis)	6-2
Table 6-8: Total Annual Industry Labor Burden (Increased Annual Growth Rate Sensitivity Analysis)	6-3
Table 6-9: Annual Industry Labor Costs (Increased Annual Growth Rate Sensitivity Analysis)	6-4
Table 6-10: Agency Cost Estimate for the Final Rule (Increased Annual Growth Rate Sensitivity Analysis)	6-5
Table 6-11: Total Social Costs for the Rule (Increased Annual Growth Rate Sensitivity Analysis)	6-5
Table 6-12: Estimated High- and Low-End Estimated Number of Commercially Relevant Nanomaterials per Manufacturer	6-6
Table 6-13: Annual Manufacturer Burden Hours (Number of Nanomaterials Per Firm Sensitivity Analysis)	6-8
Table 6-14: Annual Processor Burden Hours (Number of Nanomaterials Per Manufacturer Sensitivity Analysis)	6-9
Table 6-15: Annual Manufacturer Labor Costs (Number of Nanomaterials Per Firm Sensitivity Analysis)	6-10
Table 6-16: Annual Processor Labor Costs (Number of Nanomaterials Per Firm Sensitivity Analysis)	6-11
Table 6-17: Agency Cost Estimate for the Rule (Number of Nanomaterials Per Firm Sensitivity Analysis)	6-12
Table 6-18: Total Social Costs (Number of Nanomaterials Per Firm Sensitivity Analysis)	6-13
Table 6-19: Annual Manufacturer Burden Hours (Nanomaterials Growth Sensitivity Analysis)	6-16
Table 6-20: Annual Processor Burden Hours (Nanomaterials Growth Sensitivity Analysis)	6-17
Table 6-21: Annual Manufacturer Labor Costs (Nanomaterials Growth Sensitivity Analysis)	6-18
Table 6-22: Annual Processor Labor Costs (Number of Nanomaterials Per Firm Sensitivity Analysis)	6-19
Table 6-23: Agency Cost Estimate for the Rule  (Nanomaterials Growth Sensitivity Analysis)	6-20
Table 6-24: Total Social Costs (Nanomaterials Growth Sensitivity Analysis)	6-21
Table 6-25: Comparison of Annualized Costs of Sensitivity Analyses (Millions 2015$)	6-22
Table 8-1: Ultimate Parent NAICS Codes for the 19 "Large" Businesses in Subset	8-2
Table 8-2: Small Business and Large Business Characteristics of Subset	8-3
Table 8-3: Estimated Number of Regulated Firms	8-3
Table 8-4: Characterization of Economic Impacts	8-4
Table 8-5: Estimate of Impacts on Small Business Subset	8-4
Table 9-1: Summary of Costs per Firm in First Year (2015$)	9-4
Table 9-2: Summary of Costs per Firm in Subsequent Years (2015$)	9-4
Table 9-3: Industry Burden Estimates for the Final Rule	9-5
Exhibit A-1: Detail of Labor Categories Used in the Analysis	A-1
Exhibit A-2: Derivation of Loaded Industry Wage Rates (2015$)	A-2
Exhibit A-3: Derivation of Loaded Agency Wage Rates	A-3

Executive Summary
This economic analysis estimates and evaluates the costs and benefits of collecting information for certain chemical substances when they are manufactured or processed as nanoscale materials, through a rule promulgated by the U.S. Environmental Protection Agency (EPA), under the authority granted by Section 8(a) of the Toxic Substances Control Act (TSCA). The rule requires that persons who currently manufacture (including import), or process certain nanoscale materials (alternately described as "nanomaterials companies" and "nanomaterials firms" in this report), and/or persons who begin to manufacture, (including import), or process nanoscale materials (as defined by the rule) after the effective date of this rule, to electronically report to EPA certain information including specific chemical identity, production volume, methods of manufacture and processing, use, exposure and release information, and available health and safety data. Manufacturers and processors of multiple nanoscale forms of the same existing chemical substance will, in some cases, need to report separately for each discrete form of the reportable chemical substance.  Reporting of these discrete forms are not the same as new chemical reporting under TSCA section 5.
The final rule builds on a history of Federal and international oversight of nanotechnology. EPA has developed a Nanomaterial Research Strategy (NRS) and previously conducted a Nanoscale Materials Stewardship Program (NMSP) to collect information on nanoscale materials in commerce (both discussed in Chapter 1). Other Federal agencies have also collaborated to better understand the opportunities and risks posed by nanotechnology, as have members of the Organisation for Economic Co-operation and Development (OECD).
EPA estimates that there are approximately 823 U.S. nanomaterials manufacturers subject to TSCA and believes this to be a high-end estimate of the number of nanomaterial firms subject to the rule (see Chapter 2). Around 658 firms (nearly 80 percent of firms) are estimated to be small businesses with less than $11 million in revenue, and these firms are exempt from the reporting requirements of the rule. Each of the remaining 165 manufacturer firms is expected to report on approximately five commercially-relevant nanoscale materials in the first year of the rule. While this analysis assumes that the number of nanoscale materials manufacturers remains constant over the 10-year analysis period, the total number of regulated nanoscale materials is assumed to double.
For each nanomaterial produced by a manufacturer, EPA estimates that there are 2.32 processors. Thus, there are 1,788 processors subject to the rule in the first year, and 199 in subsequent years.
Under the rule, industry is estimated to incur a burden of approximately 360,331 hours in the first year and 40,118 hours in subsequent years, with costs of approximately $27.79 million and $3.09 million, respectively (see Chapter 3), while the Agency is expected to use approximately 16,326 hours in the first year and 1,818 hours in subsequent years, with costs of approximately $1.34 million and $0.15 million respectively (see Chapter 4). Discounted over a 10-year period at three and seven percent, total annualized social costs are estimated to be approximately $5.71 million and $6.26 million, respectively.
As required by the Regulatory Flexibility Act of 1980 and the Small Business Regulatory Enforcement Fairness Act of 1996, a small entity impact analysis conducted in Chapter 8 is based on small business definitions provided by the U.S. Small Business Administration (SBA). EPA found that the costs of the rule did not exceed 1 percent of the value of sales for any of the small businesses evaluated.
The rule is expected to provide benefits to EPA and the public. Increased and improved data on the production, sale, and use of nanoscale materials in the United States will allow EPA to more effectively determine whether additional risk assessment and management measures are needed. This information will lead to reduced cost of risk-based decision making and improved decisions concerning nanoscale materials. These benefits are discussed qualitatively in Chapter 7 of this report.

  -  Introduction
This report estimates and evaluates the costs and benefits expected to result from an information collection rule for nanoscale material manufacturers and processors promulgated by the U.S. Environmental Protection Agency (EPA) under the authority granted by Section 8(a) of the Toxic Substances Control Act (TSCA). The rule requires persons who currently manufacture (including import), or process certain nanoscale materials (alternately described as "manufacturers" and "processors" in this report), and/or persons who begin to manufacture (including import), or process nanoscale materials (as defined by the rule) after the effective date of this rule, to electronically report to EPA certain information, described in detail below. Section 1.1 provides background information on EPA's statutory authority for the rule; Section 1.2 reviews the regulatory background; Section 1.3 discusses the need for the regulation; Section 0 presents a brief summary of the methodology used in the analysis; and Section 1.5 describes the organization of the remainder of this report.
Statutory Authority
Under Section 8(a) of TSCA, EPA has statutory authority to impose information reporting and recordkeeping requirements on manufacturers and processors of chemical substances used in commerce. Insofar as the information is known, or readily available, EPA may issue an information collection rule requiring the following items among others:
Table 1-1: TSCA-authorized Reporting Requirements
Reporting Elements
 The common or trade name, the chemical identity, and the molecular structure of each chemical substance or mixture for which such a report is required.
 The categories or proposed categories of use of each such substance or mixture.
 The total amount of each such substance and mixture manufactured or processed, or reasonable estimates of the total amount to be manufactured or processed.
 A description of the byproducts resulting from the manufacture, processing, use, or disposal of each such substance or mixture.
 All existing data concerning the environmental and health effects of such substance or mixture.
 The number of individuals exposed, and reasonable estimates of the number who will be exposed, to such substance or mixture in their places of employment and the duration of such exposure.
 In the initial report under paragraph (1) on such substance or mixture, the manner or method of its disposal, and in any subsequent report on such substance or mixture, any change in such manner or method.
Source: TSCA Section 8(a), Paragraph (2), Subparagraphs (A) through (G)

Regulatory and Programmatic Background
Nanoscale materials, alternately referred to in this report as nanomaterials, constitute a unique class of chemicals. Nanomaterials are chemical substances organized in structures with dimensions measuring from 1 to 100 nanometers (nanoscale). Under the rule, reporting is required of certain solid chemical substances manufactured or processed in the range of 1 to 100 nanometers at ambient conditions.
Several regulatory and programmatic activities precede or coincide with the rule. These activities are briefly described in this section. The Nanoscale Materials Stewardship Program (NMSP), a voluntary information collection program for nanomaterials manufacturers, processors, and users established by EPA in January 2008, is described in Section 1.2.1. The broader EPA Nanomaterial Research Strategy (NRS) is described in Section 1.2.2. The government-wide National Nanotechnology Initiative (NNI) is described in Section 1.2.3. Sections 1.2.4 and 1.2.5 present two international programs to encourage global collaboration in nanotechnology regulation.
EPA Nanoscale Materials Stewardship Program (NMSP)
On January 28, 2008, EPA formally instituted the Nanoscale Materials Stewardship Program (NMSP). The NMSP was a voluntary information collection program to assemble data from manufacturers, importers, and processors, and users of industrial nanomaterials subject to TSCA. In addition to industry and commercial organizations, researchers were also invited to participate in the NMSP (EPA, 2007). By the end of the program, 31 companies and associations had responded under the Basic program, submitting information on 132 nanomaterials (EPA, 2009d).
According to the NMSP Interim Report (EPA, 2009b), the program has "considerably increased [EPA's] understanding of the types of nanoscale materials in commerce." Submissions typically provided physical and chemical properties, commercial uses, manufacturing processes, and risk management practices; however, very few submissions provided data on exposure and toxicity. Overall, EPA considers the NMSP a success for having informed EPA's regulatory understanding of nanomaterials; however, a significant number of the environmental health and safety data gaps remain.
EPA Nanomaterial Research Strategy (NRS)
The Nanomaterial Research Strategy (NRS) is a document released by the EPA Office of Research and Development (ORD) on September 29, 2009 describing EPA's strategy for conducting and supporting research to understand the environmental health and safety implications of exposure to manufactured nanomaterials and the ways in which nanotechnology can be used in environmental protection applications (EPA, 2009c). The document has three main purposes: (1) to guide EPA researchers and managers as they conduct EPA's research program; (2) to assist scientists in other organizations as they plan their own research programs; and (3) to inform the public of how EPA intends to generate scientific information to guide environmental decisions related to nanomaterials (EPA, 2009c).
The NRS focuses on developing scientific information for nanomaterial decision support. EPA has focused the NRS on four areas to take advantage of its scientific expertise as well as fill the gaps of information not addressed by other organizations. The four research themes are:
       Sources, Fate, Transport, and Exposure
       Human Health and Ecological Research to Inform Risk Assessment and Test Methods
       Risk Assessment Methods and Case Studies
       Preventing and Managing Risks
The NRS is the guiding document for the EPA Nanotechnology Research Program. EPA plans to collaborate across government, industry, and the international community to implement this strategy (EPA, 2009c).
U.S. National Nanotechnology Initiative (NNI)
The 21st Century Nanotechnology Research and Development Act of 2003 resulted in the implementation of the National Nanotechnology Initiative (NNI). The NNI created a framework for a comprehensive nanotechnology R&D program by establishing shared goals, priorities, and strategies. The NNI consists of individual and cooperative nanotechnology-related activities of 25 federal agencies with a range of research and regulatory roles and responsibilities. EPA coordinates its nanotechnology research activities with other federal agencies through the NNI (EPA, 2009b).
OECD Working Party on Manufactured Nanomaterials (WPMN)
In 2006, the Organisation for Economic Co-operation and Development (OECD) Chemicals Committee established its Working Party on Manufactured Nanomaterials (WPMN). The objective of the WPMN is to promote international cooperation in human health and environmental safety-related aspects of manufactured nanomaterials. The WPMN is engaged in a variety of projects to further the understanding of the properties and potential risks of nanomaterials (EPA, 2009b).
International Organization for Standardization (ISO) Technical Committee 229
The International Organization for Standardization (ISO) has established a technical committee to develop international standards for nanotechnology. This technical committee, ISO/TC229, is working to develop standards for terminology and nomenclature, metrology and instrumentation, including specifications for reference materials, test methodologies, modeling and simulation, and science-based health, safety and environmental practices (EPA, 2009b).
Statement of Need
Executive Order 12866 requires regulatory Agencies to identify the specific market failure that a significant rule addresses. The major causes of market failure identified in the Office of Management and Budget (OMB) guidance (OMB, 2003) on Executive Order 12866 are externality, natural monopoly, market power, and inadequate or asymmetric information. The rule is designed to address the issue of inadequate information about nanomaterial manufacture and use in commerce and, to the extent that new information indicates the presence of negative externalities, inform future rulemaking and/or legislation governing the manufacture, processing, and use of nanomaterials.
Inadequate Information
Economic theory requires that buyers and sellers have complete information about the costs and benefits of their economic choices to produce an efficient allocation of resources. When buyers or sellers do not have perfect information, rational decision making cannot occur and a market failure exists. As an example, a producer may not consider substituting a less hazardous chemical for a hazardous chemical if knowledge about either chemical's hazard is unknown or uncertain. More complete information on the hazards associated with the chemical will allow a producer to make more socially efficient decisions.
There are many reasons why information regarding the hazards associated with a chemical substance may not be widely known. Two of these reasons are:
       Producers may know this information but have no incentive to act on it or reveal it to their customers (because the costs are not borne by, and are therefore external to, the producer).
       This information may be unknown to both the producers and their customers.
The first of these reasons is known as asymmetric information; that is, a case in which consumers and producers do not have the same level of information regarding the aggregate production, uses, and hazards of a chemical substance. Typically, the producers' level of information regarding these items, particularly hazards, exceeds the consumers' level of information.
In the second case, chemical production, use, and hazard information is inadequate and/or unavailable (i.e., unknown to both consumers and producers). Producers may have little incentive to acquire such information due to the potential costs associated with its acquisition. Information is by nature a public good; that is, non-rival (one person's use of information does not diminish the amount remaining for other users) and non-excludable (once made available, information cannot be easily withheld from others). Thus, where information is provided by one person, others are free to use and benefit from that information without having made a contribution to its development. This situation reduces the incentive to provide the information, resulting in a failure of the market to efficiently provide the information. In addition, individual consumers are unlikely to be willing to pay the cost of collecting and reporting information if they can use information developed and paid for by others.
Externalities
Externalities are another cause of market failure. An externality occurs when the actions of one economic agent impose costs (or benefits) on parties that are "external" to the market transaction; that is, these costs (or benefits) are not borne by the producers or consumers directly involved. Such is the case where manufacturing or other business activities harm human health or the environment in excess of the costs borne by the parties to this activity, resulting in negative externalities. When information is missing about the human health and environmental costs to society, or when these costs are external to producers' decision making, the costs are not incorporated into business decisions. The result can be the overuse and/or overproduction of certain harmful products.
EPA often intervenes when negative externalities pose risks to human health and the environment. For example, risks may arise as a result of chemical exposure to the general population from the manufacture, processing, and use of chemicals. As a first step in mitigating externalities, the EPA Office of Pollution Prevention and Toxics (OPPT) routinely screens chemicals for the potential risks they may pose. This screening is used to determine if risks from the manufacture, processing, or use of chemicals are of sufficient concern to warrant risk management. Given that EPA's TSCA Inventory recognizes more than 75,000 chemicals in commerce, chemical risk screening represents a significant effort. Risk is a function of hazard and exposure and when information on either is lacking, EPA's ability to effectively identify significant risks arising from externalities is compromised.
Effect of the Rule
This rule improves EPA's process for reviewing chemicals and helps to address the market failure of inadequate information. Information gathered under this rule will aid EPA in determining whether future action is needed for a specific nanomaterial. More specifically, this rule will facilitate assessment of risks and risk management, examination of the benefits and costs of further measures, and making future decisions based on the best available scientific and technical information taking into account the unique characteristics of nanomaterials. This is consistent with the President's memorandum for Executive Agencies regarding Policy Principles for the U.S. Decision-Making Concerning Regulation and Oversight of Applications of Nanotechnology and Nanomaterials. It is important to note that the requirements of the rule are not based on an assumption that nanoscale materials as a class, or specific uses of nanoscale materials, necessarily give rise to or are likely to cause harm to people or the environment. Should EPA determine that a risk management action is needed and subsequently promulgate such an action, the information provided by this rule will be useful to EPA in developing an action that will help address risks related to externalities.
EPA will make non-confidential information reported under the rule available to the public. To the extent that EPA is able to make information public, the rule will also help to address market failure due to inadequate information by providing basic information about the production, use, and environmental health and safety impacts of manufactured nanomaterials to the public. This information can be used by consumers, producers, the public sector, and others to make more informed decisions regarding the production, sale, and use of nanomaterials. The information may also be used to resolve externalities. To the extent that the provision of this information induces the producers to account for external social costs, either due to fear of litigation or due to the benefits of corporate stewardship, increased availability of information will address the negative externalities generated by producing or using these chemicals.

Summary of Methodology
This analysis seeks to quantify, to the extent possible, the costs to society of the rule by identifying the costs to industry (and to small entities, in particular) associated with performing the required reporting and recordkeeping, and the costs to EPA of administering the rule. Industry costs consist of the collection, compilation, and submission of required information for the nanomaterials handled by each reporting firm. Agency costs include reviewing and processing the data received as a result of the rule. Small entity impact is defined as a small business' estimated cost of compliance with the rule as a percent of sales. Data sources for this analysis include burden estimates derived from information collection requests for similar regulations, compensation data acquired from government publications, and supplementary market research to produce an estimate of the number of affected entities. EPA believes the inputs for this analysis (e.g., estimated number of nanoscale materials) are high-end estimates and that the final burden and cost estimates may therefore be overestimated.
This report qualitatively discusses the benefits of the rule based on the value of the information it will provide. The benefits analysis was undertaken to address the implicit call for cost-benefit balancing contained in TSCA, as well as the requirements of Executive Order 12866.
Organization of This Report
The remainder of this report provides EPA's economic analysis in support of the rule. The affected chemical substances and companies are characterized in Chapter 2. Chapter 3 estimates industry cost of complying with the rule, and Chapter 4 estimates government costs associated with the administration of the rule. Chapter 5 presents the total social costs. Chapter 7 addresses the benefits of the rule using a "value of information" framework. Chapter 8 provides the small entity impact analysis for the rule, as mandated by the Regulatory Flexibility Act (RFA), and amended by the Small Business Regulatory Enforcement Fairness Act (SBREFA). Several additional impact analyses are presented in Chapter 9, including: an employment impact analysis; a burden hour analysis, which responds to the requirements of the Paperwork Reduction Act (PRA); an unfunded mandates statement, which is required by the Unfunded Mandates Reform Act (UMRA); an environmental justice statement, which addresses the requirements of Executive Order 12898; and a children's health statement, which is mandated by Executive Order 13045. Note that all dollar amounts in this analysis are reported in 2015 dollars.
  -  Affected Entities
This chapter presents information about the manufacturers, production, and uses of nanoscale materials subject to the rule. Section 2-1 provides a definition of nanoscale materials affected by the rule; Section 2-1 describes and estimates the population of affected manufacturers, including an estimate of the number of nanoscale materials handled by each reporting manufacturer; Section 2.3 describes and estimates the population of affected processors; and Section 2.4 summarizes the total regulated universe of firms.
Chemical Substances Subject to this Rule
The rule requires the reporting and maintenance of records concerning chemical substances as nanoscale materials. The rule applies to chemical substances that are solids at 25°C and standard atmospheric pressure, and that are manufactured or processed in a form where the primary particles, aggregates, or agglomerates are in the size range of 1 to 100 nm in at least one dimension and exhibit unique and novel characteristics because of their size. This rule does not apply to chemical substances manufactured or processed in forms that contain less than one percent by weight of primary particles, aggregates, or agglomerates in the size range of 1 to 100 nm. Reporting is also required if the chemical substance has different morphology or is coated with different chemical substances.
EPA is excluding from the requirements of this rule certain biological materials including DNA, RNA, proteins, enzymes, lipids, carbohydrates, peptides, liposomes, antibodies, viruses, and microorganisms, as well as chemical substances which dissociate completely in water to form ions that are less than 1 nm, and chemical substances formed at the nanoscale as part of a film on a surface.
The rule would not require manufacturers or processors to report information that has already been submitted to EPA. The reporting requirements of this rule would not apply to any person for a nanoscale material submitted as a new chemical notice under section 5 of TSCA to EPA since January 1, 2005. In addition, any person who has already reported part of or all of the required information under the Nanoscale Materials Stewardship Program would not need to report that information again. If, however, information required by this rule had not been reported or new information is now available reporting of that information would be required.
There is also an exemption from reporting for TSCA section 8(a) rules for small manufacturers and processors. For purposes of this rule, EPA is defining and exempting any small manufacturer or processor as a company that has sales of less than $11 million per year.
The rule applies to organizations operating in the United States, and thus under EPA's jurisdiction. Only those organizations handling nanoscale materials with uses subject to TSCA are subject to the rule.
Manufacturers
Three sources were used to estimate the number of U.S.-based nanomaterials firms and to construct a representative selection of firms used to estimate both the number of large and small businesses and the number of nanomaterials supplied by each firm. The sources are:
       Lux Research: Nanotech Report(TM), 5th ed. (2007)
       BCC Research: Nanotechnology: A Realistic Market Assessment (2008)
       Nanowerk: Company & Labs Directory (2009)
These sources are described in more detail in the sections below.
Lux Research Nanotech Report(TM)
The Lux Research Nanotech Report(TM) (Lux Research, 2007) is a market research report covering the field of nanotechnology. The Nanotech Report describes four categories of products: nanomaterials, nanointermediates, nano-enabled products, and nanotools. For each product in these categories, the Nanotech Report provides properties, fabrication methods, key applications, environmental/health/safety concerns, and general market descriptors such as market size, market drivers, and market challenges. For select products, it also shares major market players and patents. The report suggests that there are over 1,500 nanotechnology companies worldwide but does not provide details regarding estimation methods.
The Nanotech Report also profiles 121 nanotechnology companies worldwide. Eighty-four of these companies (69.42 percent) are based in the U.S., and of these U.S. companies, 31 companies (36.90 percent) are involved in the manufacture of nanomaterials.
Lux describes its selection of 121 nanotechnology companies as "a representative sample of companies across regions, sectors, and company types." As such, multiplying the base estimate of nanotechnology companies worldwide (1,500) by the percent of the group that are based in the U.S. (69.42 percent) and by the percent of identified U.S. companies in that group that are nanomaterials manufacturers (36.90 percent) produces an estimate of 384 nanomaterials manufacturers in the U.S.
This estimate is limited for several reasons. Lux Research does not describe the methodology used to arrive at the estimate of 1,500 nanotechnology companies worldwide, nor does it describe sampling methods that would verify the representativeness of the sample. Further, Lux acknowledges that the sample in its report includes the best known companies by design, but it does not specify any other selection criteria. EPA believes the slightly larger worldwide estimate derived from the BCC Research Nanotechnology Report (described in the following section) is a more reliable estimate for the purposes of this analysis. EPA also recognizes the inherent limitations of the Lux sample; however, given the report's description of its sample, EPA assumes the sample to be representative of the overall number of U.S. nanomaterials manufacturers.
BCC Research Nanotechnology Report (2008)
The BCC Research report Nanotechnology: A Realistic Market Assessment (BCC Research, 2008) is also a market research report covering the field of nanotechnology. The report divides the nanotechnology market into three segments: nanomaterials, nanodevices, and nanotools. It then discusses the nanotechnology market's size and structure, funding sources, and environmental, health, and safety concerns and regulation in general terms.
Due to the poorly defined and evolving nature of the nanotechnology market, the BCC Research, 2008 report acknowledges that sizing the market is difficult, if not impossible. It suggests that estimates of the number of companies with "nanotechnology activities" worldwide can be as high as 1,600.
The report refers to a sample of 165 nanotechnology companies profiled by BCC Research, 2008 and provides summary information on this sample; however, the report does not include the companies in the sample. Of the 165 companies in the sample, 112 companies (67.88 percent) are based in the United States. Additionally, of the full 165-company sample, 125 companies (75.76 percent) are nanomaterials manufacturers. However, the report does not specify how many or what percent of the U.S. companies are specifically involved in the manufacture of nanomaterials. Combining the reported percentages yields an estimate of 85 companies in the sample (51.42 percent of the sample) that are U.S. nanomaterials manufacturers.
Multiplying the estimated total number of nanotechnology companies worldwide (1,600) by the percent of the sample that are based in the U.S. (67.88 percent) and by the percent of the sample that are nanoscale materials manufacturers (75.76 percent) suggests an estimated 823 U.S. nanoscale materials firms.
This estimate is potentially limited for two reasons. BCC Research, 2008 does not describe the methodology used to arrive at the high-end estimate of 1,600 companies with "nanotechnology activities" worldwide, nor does it explain its method for selecting a subset of these nanotechnology companies to profile in its report. Thus, the set of profiled companies may not be a representative sample. EPA recognizes the inherent limitations of this sample; however, based on EPA best professional judgment, the Agency considers 823 companies to be a reasonable, and potentially high-end, estimate of the number of U.S. nanomaterials firms for the purposes of this analysis.
Nanowerk Company & Labs Directory
Nanowerk (Nanowerk, 2009) is an online resource for information on nanotechnology and nanoscience. The site provides an introduction to nanotechnology in layman's terms, nanotechnology news coverage, general information about the nanotechnology market, and disclosure of the environmental, health, and safety concerns around nanotechnology. It also claims to maintain "the most extensive industry database" of nanomaterials suppliers in its Company & Labs Directory.
The Company & Labs Directory lists manufacturers and suppliers in five categories of nanomaterials: Carbon Nanotubes, Fullerenes, Fibers and Wires, Nanoparticles, and Quantum Dots. The database provides each company's name, a brief description, and country of origin. According to aggregate statistics found on the website, the database contains 262 companies, 120 of which are identified in the listing as U.S. companies. Many of these companies manufacture several nanomaterials and are therefore listed in multiple nanomaterials categories.
The Nanowerk databases are compiled from publicly available information on nanotechnology manufacturers' websites. According to Michael Berger of Nanowerk (Berger, 2009), the lists are regularly maintained and updated with new findings. Although it claims to be the most comprehensive source available, the Company & Labs Directory is a "best effort undertaking" rather than a comprehensive listing of all suppliers. Notably, the databases exclude companies not known to Nanowerk and companies without publicly listed information.
Estimated Number of Nanomaterial Manufacturers
As noted above, EPA considers the 823 companies, estimated using BCC Research's data, to be a reasonable estimate of the current number of U.S. nanomaterials manufacturer firms for the purposes of this analysis. This estimate reflects possible growth in the population since EPA's judgment in the NMSP ICR (EPA, 2007) that the population at that time was approximately 600 companies.
EPA assumes that the number of U.S. nanoscale materials firms remains constant over the analysis period based on an analysis of more current data from BCC Research. A comparison of data from Nanotechnology: A Realistic Market Assessment (BCC Research, 2014) with the data used in this Economic Analysis shows that there has been little change in the number of firms from 2008 to 2014. However, to examine the potential effect of industry growth in the future, EPA did a sensitivity analysis using a growth rate of 11.6 percent (see Section 6.2).
Estimated Number of Exempt Firms
The general exemptions to TSCA section 8(a) reporting (as described within the statute itself) apply to the rule, including exemptions for small businesses that eliminate the reporting and recordkeeping requirements under the rule. For purposes of this rule, EPA is defining and exempting any small manufacturer as a company that has sales of less than $11 million per year.
To estimate the number of small and large manufacturers in the total number of U.S. nanomaterials manufacturer firms, this analysis uses a selection of firms assumed to be representative of firms in the market. To construct this selection, EPA compiled a list of the U.S. nanomaterials manufacturers profiled by Lux Research and Nanowerk. To avoid duplicates, the Agency considered companies found in both sources to be the same if they had identical or similar names and/or addresses. Based on this method, the selection includes 12 companies defined by Lux Research as nanomaterials firms, 101 companies defined by Nanowerk as nanomaterials firms, and an additional 19 companies defined by both Lux and Nanowerk as nanomaterials firms, for a total of 132 companies in the selection. EPA matched the selected firms to the Dun & Bradstreet (D&B) corporate database to identify company and parent company sales, measured the percentage of companies defined as small and large within the group, and applied these percentages to the estimate of the total number of firms.
EPA attempted to obtain sales data from the Dun & Bradstreet corporate database for the 132 companies following a rigorous search and matching procedure. The procedure began with a basic search by company name for each company in the selection. Companies for which the initial search returned a single match were checked for a U.S. address and considered positively matched. Companies for which the initial search returned multiple matches were subsequently filtered by zip code. Companies not found in the D&B database were considered unmatched.
As noted above, the relevant small business definition for this rulemaking considers the sales of the parent company when classifying a subsidiary as a small business. Therefore, for the matched companies identified in the D&B database as subsidiaries of a parent company, the parent company's sales were recorded. For all other matched companies, the company's sales were recorded.
A total of 103 companies in the selection were found in the D&B database. Of these, 83 companies had no parent company, and 20 companies had a parent company; however, one of the parent companies was already a member of the selection, thus reducing the matched subset to 83 + 20  -  1 = 102 companies. An additional two companies were identified as joint ventures, and one company was verified closed. Twenty-six companies remained unmatched against the D&B database.
Annual sales data were obtained from the D&B database and internet-based searches for 95 of these 102 companies. Using these data, the companies in this selection were categorized as large or small businesses under the rule's definition of small business.
Of the 95 nanomaterials manufacturers and parent companies with observed annual sales, 76 companies (80 percent of this subset) meet the small business definition with less than $11 million in reported annual sales, and 19 companies (20 percent of this subset) do not meet the small business definition, having $11 million or more in reported annual sales. These results are provided in Table 2-1.
Table 2-1: Sample Subset Characteristics
                              Population Category
                                Sales Threshold
                       Actual Number of Firms in Subset
                               Percent of Subset
Small Businesses
                               < $11 million
                                      76
                                      80%
Large Businesses
                                >= $11 million
                                      19
                                      20%
Total
                                      --
                                      95
                                     100%
Source: D&B, 2009, D&B 2016; Lux Research, 2007; Nanowerk, 2009.

Multiplying the percent of U.S.-based nanomaterials manufacturers that meet the small business definition (80 percent) by the previously estimated number of U.S.-based nanomaterials manufacturers (823 companies) yields an estimate of 658 small business nanomaterials firms and a complementary estimate of 165 large (non-small) business nanomaterials manufacturers.
Table 2-2: Estimated Number of Small and Large Manufacturers
                              Population Category
                                Sales Threshold
                   Estimated. Number of Nanomaterial Firms
                                   Percent
Small Manufacturers
                               < $11 million
                                      658
                                      80%
Large Manufacturers
                                >= $11 million
                                      165
                                      20%
Total
                                      --
                                      823
                                     100%
Source: BCC Research, 2006; D&B, 2009, D&B, 2016

Based on these estimates, 165 manufacturer firms are expected to submit chemical reports each year under the rule. EPA assumes that the number of nanomaterials manufacturers will remain constant over the next ten years. EPA has conducted an alternative analysis, presented in Section 6.1 that accounts for potential growth in the number of firms manufacturing nanomaterials.

Estimated Number of Nanomaterials per Manufacturing Firm
To estimate the number of nanomaterials per firm, EPA researched the 19 large businesses in the D&B-matched subset (of 95 companies), compiled a list of nanomaterials supplied by each large business, excluded specific nanomaterials without TSCA uses, and calculated the median number of nanomaterials per firm. The specific procedures and results of the analysis are described below.
Nanomaterial Identification Procedure
The identification of the nanomaterials produced by each large manufacturer was performed by manual examination of online product offerings. This procedure captured both nanomaterials supplied for direct sale and nanomaterials supplied as a component in a larger product. The procedure only captured nanomaterials with verified TSCA uses, based on the industries and applications advertised on each manufacturer's website. The final count distinguishes nanomaterials by chemical and physical structure, as well as size at the nanoscale. The count also distinguishes nanomaterials identified as distinct products by their manufacturers. As defined in this chapter, to qualify as a nanomaterial, at least 10 percent of a chemical substance has to exist in a form with two or more dimensions at the nanoscale.
Of the 19 large business nanomaterials firms identified, 14 had TSCA-related use product information available on a company website. The number of identified TSCA-related nanomaterials manufactured per firm varied widely, from one nanomaterial up to 66 nanomaterials.
The median number of TSCA-related nanomaterials per large business in the reduced selection for this analysis (n = 14) is 12 nanomaterials.
R&D Exclusion
The general exemptions to TSCA section 8(a) reporting (as described within the statute itself) apply to the rule, including exemptions for chemicals with strictly research and development applications. Therefore, the rule exempts chemicals with strictly research and development (R&D) applications. In the NMSP Interim Report (EPA, 2009b), EPA identified a total of 234 unique existing nanomaterials from various sources including the NMSP. Of these, 91 nanomaterials (38.89 percent) were found to be "commercially relevant," defined as being commercially available in five or more forms such as unique sizes or chemical and physical structures. The remaining 143 nanomaterials (61.11 percent) were considered produced for research and development applications.
Results
Based on an exclusion for R&D, EPA estimated an average of 4.67 nanomaterials (38.89 percent of 12 nanomaterials) with commercial relevance per reporting business. As previously mentioned, the total number of nanomaterials subject to the rule is assumed to double over the analysis period of 10 years. As a result, it is assumed that nanomaterials manufacturers will report on approximately 0.52 additional nanomaterials per year.
Table 2-3: Estimated Nanomaterials per Manufacturer, with R&D Exclusion
                              Population Category
                            Nanomaterials per Firm
                             R&D Exclusion (%)
                             R&D Exclusion (#)
              "Commercial" Nano-materials per Manufacturer[a]

                                  First Year
                               Subsequent Years
Manufacturer
                                      12
                                    61.11%
                                     7.33
                                     4.67
                                     0.52
Notes:
a The total number of nanomaterials subject to the rule is assumed to double over the analysis period of 10 years. As a result, it is assumed that nanomaterials firms will report on approximately 0.52 additional nanomaterials per year.
Source: D&B, 2009; D&B, 2016; EPA, 2007; EPA, 2009b; Company websites.

Processors
To determine the number of processors subject to the rule, EPA reviewed new chemical submissions from FY 2013, 2014, 2015, and 2016 (ending May 31, 2016). During this period, there were 37 new chemical submissions for nanomaterials. A total of 65 processors were identified on those submissions. However, when identifying the number of processors in a review of a submission, EPA looks at everything in the submission: for example, production volume and activities identified. If the number of processors identified does not fit with the other data in the submission, or if a number of processors is not identified, then EPA will estimate the number of processors different than what is provided in the submission. For this set of 37 submissions, EPA estimated that there would be 86 processors. Therefore, for this analysis, EPA estimates that there are 2.32 processors per nanomaterial (86/37 = 2.32).  While some individual nanomaterials may have more than 2.32 processors, a number of nanomaterials are sold in formulation from the manufacturers with no additional processing necessary. Additionally, not all processors will process nanomaterials such that they are reportable under the rule.
For the purposes of this economic analysis, we assume that each processor will handle one nanomaterial. As new nanomaterials are introduced in subsequent years (see Section 2.2.3), corresponding new processor firms will become subject to the rule, and will incur costs similar to that of a manufacturer in its first year of regulation.
Given the number of manufacturers estimated in Section 2.2.2 and the number of nanomaterials per manufacturer estimated in Section 2.2.3, EPA estimated the total number of regulated nanomaterials processors in the first and nine subsequent years after the rule's promulgation. For purposes of this economic analysis, EPA assumes that the same percentage of processor firms will be "large" (with revenue greater than $11 million per year) as determined in Section 2-1 for manufacturers. Therefore, EPA estimates that there will be 1,788 processors subject to the rule in the first year, and 199 in each of the subsequent nine years of the analysis period. These calculations are shown in Table 2-4. For this particular assumption, EPA did not have specific data with which to develop an estimate of the number or percentage of small and large processors. EPA had two available pieces of information to use to inform its assumption. First, EPA had information that it used to develop the estimate of the percentage of small versus large manufacturers. The data and EPA's approach is described in Section 2.2.2 and results are presented in Table 2.1. EPA also had information from the 2014 BCC report (2014, BCC Research, Nanotechnology: A Realistic Market Assessment, November) that describes the size distribution of nanotechnology firms in their research sample.  The BCC report describes nanotechnology firms as those "manufacturing and selling nanotechnology-related products and services". Therefore, the distribution they develop applies to a broader category of firms than processors (e.g., manufacturers, service providers, distributors, etc.). Furthermore, the BCC report defines large firms as those with sales greater than $1 billion annually and indicates that small-medium firms are mainly comprised of those with sales less than $10 million annually. The size distribution developed by BCC is 23% of nanotechnology firms are large and 77% of nanotechnology firms are small-medium.  Despite the BCC report covering a broader universe of firms than processors alone, EPA finds that the BCC report corroborates EPA's assumption. EPA does not find that that the two estimates are significantly different, so for analytical ease, chose to assume the same distribution of 80% large firms and 20% small firms for both manufacturers and processors.
Table 2-4: Number of Regulated Processors
                            Number of Manufacturers
                   Number of Nanomaterials per Manufacturer
                     Number of Processors per Nanomaterial
                          Total Number of Processors
                  Number of Large Processors
(20% of Total)

                                  First Year
                               Subsequent Years

                                  First Year
                               Subsequent Years
                                  First Year
                               Subsequent Years
                                      823
                                     4.67
                                     0.52
                                     2.32
                                     8,917
                                      993
                                     1,788
                                      199

Total Regulated Firms
The total number of firms that are expected to submit reports each year under the rule is determined by combining the number of large manufacturers estimated in Section 2.2 and the number of large processors as estimated in Section 2.3. As shown in Table 2-5, EPA estimates that the rule will affect 1,953 firms in the first year and 364 firms in each subsequent year.

Table 2-5: Estimated Number of Regulated Firms
                              Population Category
                   Estimated. Number of Nanomaterial Firms

                                  First Year
                             Subsequent Nine Years
Manufacturers
                                      165
                                      165
Processors
                                     1,788
                                      199
Total
                                     1,953
                                      364

  -  Industry Compliance Costs
This chapter presents estimates of the total costs that nanomaterial manufacturers and processors may incur due to the requirements included in the rule and discusses the method used to measure each.
EPA assumes the costs to comply the rule are the same for both manufacturer and processor firms. All regulated firms are required only to submit information that is known or reasonably ascertainable.
Wage Rates
The rule involves activities that may require efforts by employees in four labor classifications: attorney, managerial, technical, and clerical. Costs for each activity are calculated by estimating the labor hours required in each labor category and multiplying those burdens by the wage rate for each labor category. This section presents the estimated wage rate in each labor category.
Loaded wage rates for each labor category are derived by combining data on wages and fringe benefits with estimates of overhead rates following the methodology described in "Wage Rates for Economic Analysis of the Toxics Release Inventory Program" (EPA, 2002b). Wage and fringe benefit data for managerial, professional/technical, and clerical labor are calculated using the December 2015 quarterly estimates from the Employer Costs for Employee Compensation (ECEC) Supplemental Tables available on the BLS website (BLS, 2016a). For attorney, the wage rate was taken from the BLS Occupational Employment Statistics (OES) May 2015 National Industry-Specific Occupational Employment and Wage Estimates (BLS, 2016b). The loaded wage rate for attorney labor is $109.29; managerial labor is $81.18; technical labor is $75.89; and clerical labor is $33.66. Table 3-1 presents the basic data used to calculate the loaded wage rates for all four categories of labor, and Appendix A provides more detailed information on the estimation of these wage rates.
Table 3-1: Loaded Industry Wage Rates, 2015$
Labor Category
Base Wages[a]
Fringe Benefits[a] + Overhead Factor[b]
Loaded Wages
Attorney
                                    $65.51
                                     1.67
                                   $109.29
Managerial
                                    $48.66
                                     1.67
                                    $81.18
Professional/Technical
                                    $44.06
                                     1.72
                                    $75.89
Clerical
                                    $19.91
                                     1.69
                                    $33.66
Notes:
[a] Wage rates and fringe benefits are calculated using the December 2015 estimates from BLS (2016a), and May 2015 estimate from BLS (2016b) for Attorney.
[b] An overhead rate of 17% of base wages is used here, based on methodology and assumptions in EPA (2002a) and EPA (2002b).
Unit Industry Compliance Costs
Rule Familiarization
The rule requires reporting businesses and their staff to become familiar with the TSCA section 8(a) rule and its various requirements. Rule familiarization is estimated to require 0.55 hours of technical labor and 0.27 hours of managerial labor. This burden is equivalent to the rule familiarization burden estimated in the Economic Analysis of the Premanufacture Notification Electronic Reporting Final Rule (EPA, 2009a), because the reporting requirements for the information collection rule are similar to those required by a PMN form. Since this analysis assumes that no additional nanomaterials firms enter the market over the 10-year analysis period, rule familiarization costs are only incurred in the first year of the rule. As shown in Table 3-2, the labor cost associated with rule familiarization is $63.66.
Table 3-2: Industry One-Time Cost Estimate to Familiarize with the Rule (2015$) (per Firm)
                              Reporting Activity
                        Clerical Labor (at $33.66/hour)
                       Technical Labor (at $75.89/hour)
                       Managerial Labor (at $81.18/hour)
                               Total Labor Cost

                                    Burden
                                     Cost
                                    Burden
                                     Cost
                                    Burden
                                     Cost
                                    Burden
                                     Cost
Rule Familiarization
                                       0
                                    $0.00
                                     0.55
                                    $41.74
                                     0.27
                                    $21.92
                                     0.82
                                    $63.66
Source: BLS, 2016a; EPA, 2009a.

Form Completion
The rule requires reporters to gather and submit information consisting of all of the reporting elements found on the full NMSP reporting form. The reporting element burden estimates used here are taken from the NMSP ICR (EPA, 2007) with the exception of clerical burden. The burden estimates in the NMSP ICR assume that data elements are reported on a form whereas the rule requires electronic reporting though CDX. The total per-report industry burden of the rule is estimated to be 137 labor hours. This burden estimate is presented in Table 3-3.
Table 3-3: Industry Burden Estimate to Complete the Form (per Report)
                               Reporting Element
                                Clerical Hours
                                Technical Hours
                               Managerial Hours
                                  Total Hours
                                       1
Submitter information
                                     0.00
                                     2.00
                                     1.00
                                     3.00
                                       2
Chemical identity information
                                     0.00
                                     7.50
                                     1.00
                                     8.50
                                      3A
Physical properties
                                     0.00
                                     2.00
                                     0.50
                                     2.50
                                      3B
Additional physical properties
                                     0.00
                                     4.00
                                     1.00
                                     5.00
                                       4
Description of uses
                                     0.00
                                     3.00
                                     1.50
                                     4.50
                                       5
Amount of substance to be manufactured/imported
                                     0.00
                                     1.00
                                     1.50
                                     2.50
                                       6
Description of byproducts
                                     0.00
                                     0.50
                                     0.00
                                     0.50
                                       7
Human exposure and environmental release
                                     0.00
                                     52.00
                                     9.50
                                     61.50
                                       8
Physical properties related to understanding and assessing exposures and releases
                                     0.00
                                     4.00
                                     1.00
                                     5.00
                                       9
Overview of lifecycles
                                     0.00
                                     10.00
                                     2.00
                                     12.00
                                      10
Release point control technology
                                     0.00
                                     2.00
                                     0.40
                                     2.40
                                      11
Worker exposure information
                                     0.00
                                     2.00
                                     0.40
                                     2.40
                                      12
Protective equipment or engineering control
                                     0.00
                                     2.00
                                     0.40
                                     2.40
                                      13
Information on cleaning/reuse/disposal of used protective equipment
                                     0.00
                                     1.00
                                     0.20
                                     1.20
                                      14
Additional procedures or other equipment intended to mitigate exposures to nanoscale materials
                                     0.00
                                     1.00
                                     0.20
                                     1.20
                                      15
Description of worker training and hazardous communication
                                     0.00
                                     1.00
                                     0.20
                                     1.20
                                      16
Number of individuals other than workers exposed to the chemical and duration of exposure
                                     0.00
                                     1.00
                                     0.20
                                     1.20
                                      17
Manner or method of disposal for consumer use of products
                                     0.00
                                     2.00
                                     0.40
                                     2.40
                                      18
Test data in the submitter's possession of information on health/environmental effects
                                     0.00
                                     7.20
                                     10.00
                                     17.20
                                                                          Total
                                     0.00
                                    105.20
                                     31.40
                                    136.60
Source: EPA, 2007

Table 3-4 combines the estimated reporting burden and loaded wage rates for all three labor categories to estimate the per-report cost of complying with the reporting requirements.
Table 3-4: Industry Cost Estimate to Complete the Form (2015$) (Per Report)
                              Reporting Activity
                        Clerical Labor (at $33.66/hour)
                       Technical Labor (at $75.89/hour)
                       Managerial Labor (at $81.18/hour)
                               Total Labor Cost

                                    Burden
                                     Cost
                                    Burden
                                     Cost
                                    Burden
                                     Cost
                                    Burden
                                     Cost
                                Form Completion
                                       0
                                    $0.00
                                     105.2
                                    $7,984
                                     31.4
                                    $2,549
                                     136.6
                                    $10,533
Source: BLS, 2016a; EPA, 2007.

CBI Claim Substantiation
TSCA requires that anyone seeking protection of confidential business information (CBI) under TSCA must assert a claim, and may be required to substantiate that claim. The Act lists information that is generally not subject to substantiation requirements. Furthermore, the Act states that health and safety data submitted for substances in commercial distribution or for which testing or notification is required under TSCA are not protected as CBI. Based on this, the reporting elements of this reporting rule for nanoscale substances for which a submitter might need to substantiate a claim of CBI, if a claim is made, are:
 Submitter information
 Chemical identity
 Physical properties
 Human exposure and environmental release
 Release point control technology
 Worker exposure information
 Protective equipment or engineering control
 Information on cleaning/reuse/disposal of used protective equipment
 Additional procedures or other equipment intended to mitigate exposures to nanoscale materials
 Description of worker training and hazardous communication
 Number of individuals other than workers exposed to the chemical and duration of exposure
 Manner or method of disposal for consumer use of products
This analysis assumes that the information that is required for a submitter to substantiate a CBI claim is similar to the information described at 40 CFR 2.204(e)(4).. EPA ICR No.1665.12 (OMB Control No. 2020-0003), Renewal of Existing Information Collection Request for Confidentiality Rules (EPA, 2013) describes EPA's process for requesting substantiation of CBI claims from submitters in order to make a final confidential determination in response to a FOIA request or in the course of rulemaking or litigation and provides estimates of burden associated with completing substantiations based on information identified at 40 CFR 2.204(e)(4). Therefore, this analysis uses burden estimates from ICR No. 1655.12 to estimate CBI substantiation for this rule. According to the ICR, submitters spent six hours on each substantiation type reviewing the information, preparing the response, and submitting the response to the Agency (three attorney hours and three manager hours.) EPA assumes that assertion is accomplished via checking a box when completing the form, so the burden is included in the form completion estimate. Finally, because nanomaterials subject to this final rule are already identified on the TSCA inventory, those with chemical identity confidentiality claims are expected to have already have established generic names. Therefore, EPA does not include additional burden estimates to meet the specific substantiation requirements associated with chemical identity claims.

EPA's current intended approach is to review every fourth submission received and to notify submitters who will be provided an opportunity to comment (substantiate) the CBI claims (EPA, 2016). Therefore, for this analysis, EPA assumes that only 25 percent of those submissions with CBI claims will substantiate. The average per-report burden as described above is adjusted accordingly (e.g., 6 hours x 25% = 1.5 hours).

As shown in Table 3-5, the labor cost associated with CBI claim substantiation is approximately $143 per report.
Table 3-5: Industry Cost for CBI Claim Substantiation (2015$) (Average Per Report)

                              Reporting Activity
                       Managerial Labor (at $81.18/hour)
                       Attorney Labor (at $109.29/hour)
                               Total Labor Cost

                                    Burden
                                     Cost
                                    Burden
                                     Cost
                                    Burden
                                     Cost
CBI Claim Substantiation
                                     0.75
                                    $60.89
                                     0.75
                                    $81.97
                                      1.5
                                    $142.86
Sources: EPA, 2013; BLS, 2016a; BLS, 2016b.

 Electronic Reporting
The rule requires submitters to register with EPA's Central Data Exchange (CDX) and use the Chemical Information Submission System (CISS) to prepare and submit a data file. CDX is EPA's electronic system for environmental data exchange to the Agency. CDX also provides the capability for submitters to access their data through the use of web services. EPA developed CISS for use in submitting data for TSCA sections 4, 8(a), and 8(d) electronically to the Agency. CISS, a web-based reporting tool, provides user-friendly navigation, works with CDX to secure online communication, creates a completed Portable Document Format (PDF) for review prior to submission, and enables data, reports, and other information to be submitted easily.
EPA believes that electronic reporting reduces the reporting burden for submitters by reducing the cost and time required to review, edit, and transmit data to the Agency. It also allows submitters to share a draft submission within their organization, and more easily save a copy for their records or future use. The resource and time requirements to review and process data by the Agency will also be reduced and document storage and retrieval will require fewer resources.
EPA estimates that affected facilities will incur additional burden and cost due to the electronic reporting requirements of the rule. This includes costs in the first year to complete a subscriber agreement and register with CDX. Some respondents will incur CDX costs in subsequent years due to employee turnover or compromised electronic signatures. These costs are offset by reductions in reporting and recordkeeping costs due to electronic reporting. Understanding the electronic reporting requirements is expected to be part of rule familiarization discussed in Section 3.4.1 and are not included again in this section.
Some company users who have already registered with CDX to meet other EPA electronic reporting requirements, for example to submit Premanufacture Notices (PMNs) or to report under the Chemical Data Reporting rule (CDR), will not need to register again as a result of this rule. While EPA expects that some nanomaterial manufacturers and processors will have employees who have registered with CDX, there is no way to determine how many new users would need to register as a result of this rule. Therefore, the Agency assumes that all affected submitters would register with CDX and, thus, incur an associated cost. This high-end assumption likely results in an overestimation of the costs associated with the final rule.
When registering with CDX, users are assigned to one of two roles in the CDX system, an Authorized Official or a Support Registrant.
      Authorized Official (AO): The AO is the person legally responsible for the submission.  The AO is typically a senior official for the respondent. The AO is the only user who can start a new form, or reopen a completed form to begin the amendment process, and is the only user who can electronically sign and submit a form. AOs can also assign Support Registrants to edit and complete forms on his or her behalf. AOs must submit a subscriber agreement to EPA, and register with CDX.
      Support Registrants: A Support Registrant is a person designated by an AO to submit supporting documents on his or her behalf.  Support Registrants can edit a submission that is created by the AO. Support Registrants are only allowed to edit the submissions to which the AO has granted him or her access. Support Registrants do not have any access rights to create or submit a form.  Once the AO creates a form, they will provide the Support Registrant with a passphrase to access the submission and complete all sections of the form. Once the Support Registrant has finished completing the form, the AO will access the submission, review it, and submit it. Support Registrants must register with CDX, but do not need to submit a subscriber agreement to EPA.
This analysis uses a simplifying assumption that an average of five employees at each respondent firm will register with CDX: one manager (who will serve as AO) four technical staff members (who will serve as Support Registrants).
First Year Costs
Respondents will incur electronic reporting costs in the first year to register with CDX, submit a subscriber agreement, contact EPA's CDX Help Desk and perform ongoing problem resolution to resolve problems with their certifications or agreements.
      Subscriber Agreement/Electronic Signature Agreement. An AO must complete a subscriber agreement in order to establish their identity and their relationship to the entity for which they will submit electronic documents, as well as to document a unique correlation with the device that will be used to create their electronic signature. While users can comply with the subscriber agreement provisions in CDX either by submitting a paper subscriber agreement with a wet-ink signature, or by submitting an electronic signature agreement, this analysis assumes that all will submit electronic signature agreements. Preparing, submitting, and filing a subscriber agreement and an electronic signature agreement is estimated to require an average of 15 minutes of time per registrant (EPA, 2011). Because only an AO must complete the subscriber and electronic signature agreement, this is assumed to be managerial time. In addition, the burden estimate is assumed to include identity verification through a third party electronic verification process that is an available service through CDX.
      CDX Registration. CDX users will need to register with CDX, which involves selecting a user name and password, providing contact information, and identifying the facility and the registrant's role (e.g., AO or Support Registrant) at the facility.  This is estimated to take an  average of 10 minutes per user (EPA, 2011). Because there are assumed to be one manager and four technical staff registering, this results in an estimate that each respondent (business) will spend 10 minutes of managerial time and 40 minutes of technical time to register with CDX.
      Help Desk. CDX users are assumed to spend an average of 4 minutes contacting EPA's CDX Help Desk for technical support (EPA, 2011), which results in an estimate of 4 minutes of managerial time and 16 minutes of technical time per respondent.
      Problem Resolution. Three percent of respondents each year are assumed to spend an average of one hour of technical time working with EPA's CDX Help Desk to resolve problems involving their registrations or agreements (EPA, 2011).
Subsequent Year Costs
In subsequent years, respondents may incur electronic reporting costs due to employee turnover and compromised electronic signatures as well ongoing problem resolution.
      Employee Turnover. It is assumed that each year 10 percent of CDX users will be replaced by new employees, who will have to comply with the subscriber agreement and/or CDX registration requirements (EPA, 2011). Thus, in subsequent years 10 percent of AOs will spend 15 minutes of managerial time to complete a subscriber agreement. In addition, 10 percent of all users (both managerial and technical) will spend10 minutes to register with CDX.
      Report Compromised Signature. Each year 1 percent of respondents are assumed to report a compromised or surrendered electronic signature, which requires the submittal of a new subscriber agreement (EPA, 2011). This will entail 15-20 minutes of managerial time to report the compromised signature and prepare, submit, and file a new agreement, plus an additional 4 minutes contacting the Help Desk for a total of approximately 24 minutes.
      Help Desk. CDX users are assumed to spend an average of 4 minutes contacting EPA's CDX Help Desk for technical support (EPA, 2011), which results in an estimate of 4 minutes of managerial time and 16 minutes of technical time per respondent.
      Problem Resolution. Three percent of respondents each year are assumed to spend an average of one hour of technical time with EPA's CDX Help Desk to resolve problems involving their registrations or agreements (EPA, 2011).
Table 3-6 and Table 3-7 present the first year burden and costs and subsequent year labor burden and costs for electronic reporting.
Table 3-6: Industry Burden and Cost of Electronic Reporting Requirements
(First Year, per Firm) (2015$)
                              Reporting Activity
                       Clerical Labor
(at $33.66/hour)
                       Technical Labor
(at $75.89/hour)
                      Managerial Labor
(at $81.18/hour)
                          Number of Annual Activities
                               Total Labor Cost

                                    Burden
                                     Cost
                                    Burden
                                     Cost
                                    Burden
                                     Cost

                                    Burden
                                     Cost
CDX Registration
                                     0.00
                                    $0.00
                                     0.67
                                    $50.85
                                     0.17
                                    $13.80
                                       1
                                     0.84
                                    $64.65
Electronic Subscriber Agreement/ Electronic Signature
                                     0.00
                                    $0.00
                                     0.00
                                    $0.00
                                     0.25
                                    $20.30
                                       1
                                     0.25
                                    $20.30
Help Desk
                                     0.00
                                    $0.00
                                     0.24
                                    $18.21
                                     0.06
                                    $4.87
                                       1
                                     0.30
                                    $23.08
Problem Resolution
                                     0.00
                                    $0.00
                                     1.00
                                    $75.89
                                       0
                                    $0.00
                                     0.03
                                     0.03
                                     $2.28
                                                                         Totals
                                     1.42
                                    $110.31

Table 3-7: Industry Burden and Cost of Electronic Reporting Requirements (Subsequent Years, per Firm) (2015$)
                              Reporting Activity
                       Clerical Labor
(at $33.66/hour)
                       Technical Labor
(at $75.89/hour)
                      Managerial Labor
(at $81.18/hour)
                          Number of Annual Activities
                               Total Labor Cost

                                    Burden
                                     Cost
                                    Burden
                                     Cost
                                    Burden
                                     Cost

                                    Burden
                                     Cost
CDX Registration
                                     0.00
                                    $0.00
                                     0.67
                                    $50.85
                                     0.17
                                    $13.80
                                     0.10
                                     0.08
                                     $6.47
Electronic Subscriber Agreement/ Electronic Signature
                                     0.00
                                    $0.00
                                     0.00
                                    $0.00
                                     0.25
                                    $20.30
                                     0.10
                                     0.03
                                     $2.03
Help Desk
                                     0.00
                                    $0.00
                                     0.24
                                    $18.21
                                     0.06
                                    $4.87
                                     0.10
                                     0.03
                                     $2.31
Report Compromised Signature
                                     0.00
                                    $0.00
                                     0.00
                                    $0.00
                                     0.40
                                    $32.47
                                     0.01
                                     0.00
                                     $0.32
Problem Resolution
                                     0.00
                                    $0.00
                                     1.00
                                    $75.89
                                     0.00
                                    $0.00
                                     0.03
                                     0.03
                                     $2.28
                                                                         Totals
                                     0.17
                                    $13.41

Recordkeeping
Reporting businesses will be required to compile and maintain records of the collected information for three years after they are created. Based on estimates taken from the Regulatory Impact Analysis of Amendments to Regulations for TSCA Section 5 Premanufacture Notification (EPA, 1994) which estimates the burden associated with PMN form completion and submission, estimates of recordkeeping of paper records is expected to require one hour of technical labor, and one hour of clerical labor per report for all reporters. Estimates from this RIA were used in the NMSP ICR (EPA, 2007) to estimate about half the burdens presented in Table 3-3. However, the original PMN burden estimates from the 1994 RIA include recordkeeping costs (EPA, 1994, pages III-13 and III-14). To account for the additional recordkeeping burden not captured by these estimates EPA used the additional two hour recordkeeping burden for polymer exception submissions, which have more stringent recordkeeping requirements than PMNs (EPA, 1994, page IV-6). In addition this two hour burden is consistent with the estimate of 1 to 3 hours of recordkeeping burden per TSCA section 8(a) notice presented in the Information Collection Request for Toxic Substance Control Act Section 8(a) Chemical-Specific Information Gathering Rules (EPA, 2006).
This rule requires electronic reporting, however, which is expected to reduce the recordkeeping burden. EPA assumes that the final rule will reduce recordkeeping burden by half because of the efficiencies in creating and storing documents electronically. The full recordkeeping burden and associated cost estimates are presented in Table 3-8.

Table 3-8:  Industry Cost Estimate to Maintain Records (2015$) (per Report)
                              Reporting Activity
                       Clerical Labor
(at $33.66/hour)
                       Technical Labor
(at $75.89/hour)
                      Managerial Labor
(at $81.18/hour)
                               Total Labor Cost

Burden
                                     Cost
                                    Burden
                                     Cost
                                    Burden
                                     Cost
                                    Burden
                                     Cost
                                 Recordkeeping
                                      0.5
                                    $16.83
                                      0.5
                                    $37.95
                                       0
                                    $0.00
                                       1
                                    $54.78
Source: BLS, 2016a; EPA, 1994.
Discounting Methods
Discounting refers to the economic conversion of future costs (and benefits) to their present values, accounting for the fact that society tends to value future costs or benefits less than comparable near-term costs or benefits. Discounting is important when the values of costs or benefits occur over a multiple year period and may vary from year to year. Discounting enables the accumulation of the cost and benefit values from multiple years at a single point in time, accounting for the difference in how society values those costs and benefits depending on the year in which the values are estimated to occur.
The rule requires that firms incur a one-time cost related to the reporting and maintenance of records pertaining to each nanoscale material manufactured or processed for redistribution and use in the United States.
Costs are discounted over a 10-year period using rates of three and seven percent. The 10-year analysis period was selected because the number of nanomaterials is assumed to double over the next 10 years. The analysis assumes that first year costs are incurred at the beginning of the period; as a result, costs incurred during the first year do not need to be discounted. Costs accrued in subsequent years are discounted (for the discount rate r = 3 percent and r = 7 percent and t = time in years) back to the beginning of the 10-year period (present value), as follows:
  Present Value=t=110(Undiscounted Value)t(1+r)t

This analysis also presents the 10-year annualized costs of the rule. Conceptually, the annualized cost is equivalent to the level annual payment that one would have to make to pay off a debt equal to the net present value of the costs for a given interest rate (the discount rate). The costs are annualized such that the net present value of the costs is equivalent to a stream of 10 equal payments assuming that all costs are incurred at the end of each year.
Annualized Cost=(PV)*r*(1+r)10(1+r)11-1
                                                                              (

Total Industry Compliance Costs
As explained in Chapter 2, EPA estimates that 165 manufacturer reporters will submit chemical reports for an average of 4.67 nanomaterials per firm in the first year of the rule, while 1,788 processors submit one report each; this results in approximately 2,559 reports during the first year. The total number of nanomaterials subject to the rule is assumed to double over the 10-year analysis period, with an average of approximately 0.52 additional nanomaterials per manufacturer in subsequent years, resulting in annual total of 285 additional manufacturer and processor reports in each subsequent year. As indicated in Table 3-13, the total cost of the rule to nanomaterials firms drops from approximately $27.79 million in the first year of the rule to approximately $3.09 million in subsequent years (without discounting). The annualized industry cost of the rule over the 10-year analysis period is $5.44 million with a three percent discount rate and $5.98 million with a seven percent discount rate.

Table 3-9: Total Annual Burden Hours - Manufacturers
                                     Year
                                Number of Firms
                               Reports per Firmb
                    Rule Familiarizationc Burden (per Firm)
  Form Completion, CBI Substantiation, and Recordkeeping Burden (per Report)
                    Electronic Reporting Burden (per Firm)d
                             Total Burden Per Firm
                           Total Number of Reportsb
                              Total Manuf. Burden
                                       1
                                      165
                                     4.67
                                     0.82
                                      139
                                     1.42
                                      652
                                      771
                                    107,616
                                       2
                                      165
                                     0.52
                                     0.00
                                      139
                                     0.17
                                      73
                                      86
                                    11,991
                                       3
                                      165
                                     0.52
                                     0.00
                                      139
                                     0.17
                                      73
                                      86
                                    11,991
                                       4
                                      165
                                     0.52
                                     0.00
                                      139
                                     0.17
                                      73
                                      86
                                    11,991
                                       5
                                      165
                                     0.52
                                     0.00
                                      139
                                     0.17
                                      73
                                      86
                                    11,991
                                       6
                                      165
                                     0.52
                                     0.00
                                      139
                                     0.17
                                      73
                                      86
                                    11,991
                                       7
                                      165
                                     0.52
                                     0.00
                                      139
                                     0.17
                                      73
                                      86
                                    11,991
                                       8
                                      165
                                     0.52
                                     0.00
                                      139
                                     0.17
                                      73
                                      86
                                    11,991
                                       9
                                      165
                                     0.52
                                     0.00
                                      139
                                     0.17
                                      73
                                      86
                                    11,991
                                      10
                                      165
                                     0.52
                                     0.00
                                      139
                                     0.17
                                      73
                                      86
                                    11,991
                                     Total
                                       -
                                     9.35
                                       -
                                       -
                                       -
                                       -
                                     1,545
                                    215,535
Notes:
a EPA assumes that the number of firms remains constant over the analysis period.
b The total number of nanomaterials subject to the rule is assumed to double over the 10-year analysis period. As a result, nanomaterials firms will report on an average of approximately 0.52 additional nanomaterials per firm in subsequent years.
c Derived in Table 3-2; d Derived from Table 3-3, Table 3-6, Table 3-7, and Table 3-8.
Values may not calculate exactly due to rounding

Table 3-10: Total Annual Burden Hours - Processors
                                     Year
                               Number of Firmsa
                               Reports per Firmb
                    Rule Familiarizationc Burden (per Firm)
  Form Completion, CBI Substantiation, and Recordkeeping Burden (per Report)
                    Electronic Reporting Burden (per Firm)d
                             Total Burden Per Firm
                           Total Number of Reportsb
                            Total Processor Burden
                                       1
                                     1,788
                                     1.00
                                     0.82
                                      139
                                     1.42
                                      141
                                     1,788
                                    252,715
                                       2
                                      199
                                     1.00
                                     0.82
                                      139
                                     1.42
                                      141
                                      199
                                    28,127
                                       3
                                      199
                                     1.00
                                     0.82
                                      139
                                     1.42
                                      141
                                      199
                                    28,127
                                       4
                                      199
                                     1.00
                                     0.82
                                      139
                                     1.42
                                      141
                                      199
                                    28,127
                                       5
                                      199
                                     1.00
                                     0.82
                                      139
                                     1.42
                                      141
                                      199
                                    28,127
                                       6
                                      199
                                     1.00
                                     0.82
                                      139
                                     1.42
                                      141
                                      199
                                    28,127
                                       7
                                      199
                                     1.00
                                     0.82
                                      139
                                     1.42
                                      141
                                      199
                                    28,127
                                       8
                                      199
                                     1.00
                                     0.82
                                      139
                                     1.42
                                      141
                                      199
                                    28,127
                                       9
                                      199
                                     1.00
                                     0.82
                                      139
                                     1.42
                                      141
                                      199
                                    28,127
                                      10
                                      199
                                     1.00
                                     0.82
                                      139
                                     1.42
                                      141
                                      199
                                    28,127
                                     Total
                                       -

                                       -
                                       -
                                       -
                                       -
                                     3,579
                                    505,858
Notes:
a EPA assumes that the number of firms remains constant over the analysis period.
b The total number of nanomaterials subject to the rule is assumed to double over the 10-year analysis period. As a result, nanomaterials firms will report on an average of approximately 0.52 additional nanomaterials per firm in subsequent years.
c Derived in Table 3-2 d; Derived from Table 3-3, Table 3-6, Table 3-7, and Table 3-8.
Values may not calculate exactly due to rounding

Table 3-11: Total Annualized Costs - Manufacturers
                                     Year
                               Number of Firmsa
                               Reports per Firmb
                     Rule Familiarizationc Cost (per Firm)
      Form Completion, CBI Subst., and Record-keeping Cost (per Report)d
              Electronic Reporting Requirements Cost (per Firm)e
                             Total Cost (per Firm)
                          Discounted Cost (Per Firm)
                           Total Number of Reportsb
                          Total Cost (Millions 2015$)
                         Manufacturer Discounted Cost
                               (Millions 2015$)

                               3 % Discount Rate
                               7 % Discount Rate

                               3 % Discount Rate
                               7 % Discount Rate
                                       1
                                      165
                                     4.67
                                    $63.66
                                   $10,730
                                   $110.31
                                   $50,285
                                   $50,285
                                   $50,285
                                      771
                                    $8.30
                                    $8.30
                                    $8.30
                                       2
                                      165
                                     0.52
                                    $0.00
                                   $10,730
                                    $13.41
                                    $5,593
                                    $5,430
                                    $5,227
                                      86
                                    $0.92
                                    $0.90
                                    $0.86
                                       3
                                      165
                                     0.52
                                    $0.00
                                   $10,730
                                    $13.41
                                    $5,593
                                    $5,272
                                    $4,885
                                      86
                                    $0.92
                                    $0.87
                                    $0.81
                                       4
                                      165
                                     0.52
                                    $0.00
                                   $10,730
                                    $13.41
                                    $5,593
                                    $5,119
                                    $4,566
                                      86
                                    $0.92
                                    $0.84
                                    $0.75
                                       5
                                      165
                                     0.52
                                    $0.00
                                   $10,730
                                    $13.41
                                    $5,593
                                    $4,970
                                    $4,267
                                      86
                                    $0.92
                                    $0.82
                                    $0.70
                                       6
                                      165
                                     0.52
                                    $0.00
                                   $10,730
                                    $13.41
                                    $5,593
                                    $4,825
                                    $3,988
                                      86
                                    $0.92
                                    $0.80
                                    $0.66
                                       7
                                      165
                                     0.52
                                    $0.00
                                   $10,730
                                    $13.41
                                    $5,593
                                    $4,684
                                    $3,727
                                      86
                                    $0.92
                                    $0.77
                                    $0.61
                                       8
                                      165
                                     0.52
                                    $0.00
                                   $10,730
                                    $13.41
                                    $5,593
                                    $4,548
                                    $3,483
                                      86
                                    $0.92
                                    $0.75
                                    $0.57
                                       9
                                      165
                                     0.52
                                    $0.00
                                   $10,730
                                    $13.41
                                    $5,593
                                    $4,415
                                    $3,255
                                      86
                                    $0.92
                                    $0.73
                                    $0.54
                                      10
                                      165
                                     0.52
                                    $0.00
                                   $10,730
                                    $13.41
                                    $5,593
                                    $4,287
                                    $3,042
                                      86
                                    $0.92
                                    $0.71
                                    $0.50
                                     Total
                                       -
                                     9.35
                                       -
                                       -

                                     1,545
                                       -
                                       -
                                       -
                                                                Annualized Cost
                                    $9,846
                                   $10,809

                                    $1.62
                                    $1.78
Notes:
a EPA assumes that the number of firms remains constant over the analysis period.
b The total number of nanomaterials subject to the rule is assumed to double over the 10-year analysis period. As a result, nanomaterials firms will report on an average of approximately 0.52 additional nanomaterials per firm in subsequent years.
c Derived in Table 3-2
d Derived from Table 3-3, Table 3-6, Table 3-7, and Table 3-8.
e Derived from Table 3-3, Table 3-6, Table 3-7, and Table 3-8.
Values may not calculate exactly due to rounding.

Table 3-12: Total Annualized Costs - Processors
                                     Year
                               Number of Firmsa
                               Reports per Firmb
                     Rule Familiarizationc Cost (per Firm)
   Form Completion, CBI Substantiation, and Recordkeeping Cost (per Report)d
              Electronic Reporting Requirements Cost (per Firm)e
                             Total Cost (per Firm)
                          Discounted Cost (Per Firm)
                           Total Number of Reportsb
                          Total Cost (Millions 2015$)
                           Processor Discounted Cost
                               (Millions 2015$)

                               3 % Discount Rate
                               7 % Discount Rate

                               3 % Discount Rate
                               7 % Discount Rate
                                       1
                                     1,788
                                       1
                                    $63.66
                                   $10,730
                                   $110.31
                                   $10,904
                                   $10,904
                                   $10,904
                                     1,788
                                    $19.49
                                    $19.49
                                    $19.49
                                       2
                                      199
                                       1
                                    $63.66
                                   $10,730
                                   $110.31
                                   $10,904
                                   $10,587
                                   $10,191
                                      199
                                    $2.17
                                    $2.11
                                    $2.03
                                       3
                                      199
                                       1
                                    $63.66
                                   $10,730
                                   $110.31
                                   $10,904
                                   $10,278
                                    $9,524
                                      199
                                    $2.17
                                    $2.05
                                    $1.90
                                       4
                                      199
                                       1
                                    $63.66
                                   $10,730
                                   $110.31
                                   $10,904
                                    $9,979
                                    $8,901
                                      199
                                    $2.17
                                    $1.99
                                    $1.77
                                       5
                                      199
                                       1
                                    $63.66
                                   $10,730
                                   $110.31
                                   $10,904
                                    $9,688
                                    $8,319
                                      199
                                    $2.17
                                    $1.93
                                    $1.66
                                       6
                                      199
                                       1
                                    $63.66
                                   $10,730
                                   $110.31
                                   $10,904
                                    $9,406
                                    $7,775
                                      199
                                    $2.17
                                    $1.87
                                    $1.55
                                       7
                                      199
                                       1
                                    $63.66
                                   $10,730
                                   $110.31
                                   $10,904
                                    $9,132
                                    $7,266
                                      199
                                    $2.17
                                    $1.82
                                    $1.45
                                       8
                                      199
                                       1
                                    $63.66
                                   $10,730
                                   $110.31
                                   $10,904
                                    $8,866
                                    $6,791
                                      199
                                    $2.17
                                    $1.76
                                    $1.35
                                       9
                                      199
                                       1
                                    $63.66
                                   $10,730
                                   $110.31
                                   $10,904
                                    $8,608
                                    $6,346
                                      199
                                    $2.17
                                    $1.71
                                    $1.26
                                      10
                                      199
                                       1
                                    $63.66
                                   $10,730
                                   $110.31
                                   $10,904
                                    $8,357
                                    $5,931
                                      199
                                    $2.17
                                    $1.66
                                    $1.18
                                     Total
                                       -

                                       -
                                       -

                                     3,579
                                       -
                                       -
                                       -
                                                                Annualized Cost
                                   $10,053
                                   $10,214

                                    $3.82
                                    $4.19
Notes:
a EPA assumes that the number of firms remains constant over the analysis period.
b The total number of nanomaterials subject to the rule is assumed to double over the 10-year analysis period. As a result, nanomaterials firms will report on an average of approximately 0.52 additional nanomaterials per firm in subsequent years.
c Derived in Table 3-2
d Derived from Table 3-3, Table 3-6, Table 3-7, and Table 3-8.
e Derived from Table 3-3, Table 3-6, Table 3-7, and Table 3-8.
Values may not calculate exactly due to rounding.

Table 3-13: Total Annualized Industry Costs
                                     Year
                            Total Number of Reports
                             Total Burden (hours)
                         Total Cost
(Millions 2015$)
                           Industry Discounted Cost

                               (Millions 2015$)

                               3 % Discount Rate
                               7 % Discount Rate
                                       1
                                     2,559
                                    360,331
                                    $27.79
                                    $27.79
                                    $27.79
                                       2
                                      285
                                    40,118
                                    $3.09
                                    $3.00
                                    $2.89
                                       3
                                      285
                                    40,118
                                    $3.09
                                    $2.92
                                    $2.70
                                       4
                                      285
                                    40,118
                                    $3.09
                                    $2.83
                                    $2.53
                                       5
                                      285
                                    40,118
                                    $3.09
                                    $2.75
                                    $2.36
                                       6
                                      285
                                    40,118
                                    $3.09
                                    $2.67
                                    $2.21
                                       7
                                      285
                                    40,118
                                    $3.09
                                    $2.59
                                    $2.06
                                       8
                                      285
                                    40,118
                                    $3.09
                                    $2.52
                                    $1.93
                                       9
                                      285
                                    40,118
                                    $3.09
                                    $2.44
                                    $1.80
                                      10
                                      285
                                    40,118
                                    $3.09
                                    $2.37
                                    $1.68
                                     Total
                                     5,124
                                    721,393

                                                                Annualized Cost
                                     $5.44
                                     $5.98

  -  Agency Costs
Wage Rates
EPA assumes that, on average, a Federal GS-13, Step 5 full-time equivalent (FTE) will conduct its collection and administrative activities under the rule (that is, the professional/technical labor). The annual 2015 fully loaded salary for a GS-13, Step 5 FTE is $164,691. This estimate includes a base salary of $102,932 plus a 60 percent load increase to account for benefits and overhead (i.e., $61,759). Dividing the fully loaded annual salary by 2,087 hours (i.e., the number of hours in a work year as defined by OPM) yields an hourly FTE wage rate of $78.91. EPA assumes that a Federal GS-14, Step 5 FTE will perform attorney activities under the rule. An hourly wage rate of $93.25 was calculated using the same method as for the technical labor. Appendix A provides a detailed description of these calculations.
Table 4-1: Loaded EPA Wage Rates, 2015$
Labor Category