individuals to pay to reduce these risks--will increase as real per
capita income increases.\111\ With increased income, an individual's
health and life becomes more valuable relative to other goods because,
unlike other goods, they are without close substitutes. Expressed
differently, as income increases, consumption will increase but the
marginal utility of consumption will decrease. In contrast, added years
of life (in good health) are, in the model of Hall and Jones (2007,
Document ID 0720), not subject to the same type of diminishing returns
and, indeed, may be viewed as the ultimate good.
---------------------------------------------------------------------------

    \111\ Simple modeling can show this directly. For example, Rosen
(1988) (Document ID 1165) demonstrates that the value of life can be
expressed as the marginal rate of substitution between wealth and
the probability of survival. An increase in wealth or income will
therefore increase an individual's willingness to pay.
---------------------------------------------------------------------------

    Second, real per capita income has broadly been increasing
throughout U.S. history, including during recent

periods.\112\ For example, for the period 1950 through 2000, real per
capita income grew at an average rate of 2.31 percent a year (Hall and
Jones, 2007, Document ID 0720),\113\ although real per capita income
for the recent 25 year period 1983 through 2008 grew at an average rate
of only 1.3 percent a year (U.S. Census Bureau, 2010, Document ID
1621). More important is the fact that real U.S. per capita income is
estimated to grow significantly in future years. The Annual Energy
Outlook (AEO) estimates, prepared by the Energy Information
Administration (EIA) in the Department of Energy (DOE), estimates an
average annual growth rate of per capita income in the United States of
2.7 percent for the period 2011-2035.\114\ The U.S. Environmental
Protection Agency prepared its economic analysis of the Clean Air Act
using the AEO estimates. OSHA concludes that it is reasonable to use
the same AEO estimates employed by DOE and EPA, and correspondingly
estimates that per capita income in the United States will increase by
2.7 percent per year over the 60-year period in the analysis for this
silica rule. OSHA, as discussed below, will not use this value combined
with the best estimate of income elasticity. Instead OSHA derives a
lower combined measure of the adjustment that combines income
elasticity and rate of economic growth. Further, OSHA analyzes the
sensitivity of the results to this assumption later in this chapter.
---------------------------------------------------------------------------

    \112\ In addition, as Costa (1998) and Costa and Kahn (2004)
(Document ID 0609) point out, elderly health, longevity, and well-
being in the United States have historically been improving, which
also has the effect of increasing the imputed value of life. Of
course, improvements in elderly health, longevity, and well-being
are not independent of increases in per capita income over the same
period.
    \113\ The results are similar if the historical period includes
a major economic downturn (such as the United States has recently
experienced). From 1929 through 2003, a period in U.S. history that
includes the Great Depression, real per capita income still grew at
an average rate of 2.22 percent a year (Gomme and Rupert, 2004)
(Document ID 0710).
    \114\ The EIA used DOE's National Energy Modeling System (NEMS)
to produce the Annual Energy Outlook (AEO) estimates (EIA, 2011)
(Document ID 1573). Future per capita GDP was calculated by dividing
the projected real gross domestic product each year by the estimates
U.S. population for that year.
---------------------------------------------------------------------------

    On the basis of the predicted increase in real per capita income in
the United States over time and the expected resulting increase in the
value of avoided fatalities and diseases, OSHA has adjusted its
estimates of the benefits of the final rule to reflect the anticipated
increase in their value over time. This type of adjustment has been
supported by EPA's Science Advisory Board (EPA, 2000b, Document ID
0652) \115\ and applied by EPA.\116\ OSHA accomplished this adjustment
by modifying benefits in year i from [Bi] to [Bi
* (1 + k)i], where ``k'' is the estimated annual increase in
the magnitude of the benefits of the final rule.\117\
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    \115\ Supplementary evidence in support for this type of
adjustment comes from EPA (2010) (Document ID 1713) and U.S.
Department of Transportation (2014) guidelines.
    \116\ See, for example, EPA (2003) (Document ID 0657) and EPA
(2008) (Document ID 0661).
    \117\ This precise methodology was suggested in Ashford and
Caldart (1996) (Document ID 0538).
---------------------------------------------------------------------------

    What remains is to estimate a value for ``k'' with which to
increase benefits annually in response to annual increases in real per
capita income, where ``k'' is equal to (1 + g) * ([eta]), ``g'' is the
expected annual percentage increase in real per capita income, and
``[eta]'' is the income elasticity of the value of a statistical life.
Probably the most direct evidence of the value of ``k'' comes from the
work of Costa and Kahn (2003, 2004). They estimate repeated labor
market compensating wage differentials from cross-sectional hedonic
regressions using census and fatality data from the Bureau of Labor
Statistics for 1940, 1950, 1960, 1970, and 1980. In addition, with the
imputed income elasticity of the value of life on per capita GNP of 1.7
derived from the 1940-1980 data, they then predict the value of an
avoided fatality in 1900, 1920, and 2000. Given the change in the value
of an avoided fatality over time, it is possible to estimate a value of
``k'' of 3.4 percent a year from 1900-2000; of 4.3 percent a year from
1940-1980; and of 2.5 percent a year from 1980-2000.\118\
---------------------------------------------------------------------------

    \118\ These estimates for ``k'' were not reported in Costa and
Kahn (2003 Document ID 0610, 2004, Document ID 0609) but were
derived by OSHA from the data presented. The changes in the value of
``k'' for the different time periods mainly reflect different growth
rates of per capita income during those periods.
---------------------------------------------------------------------------

    Other, more indirect evidence comes from estimates in the economics
literature on the income elasticity of the value of a statistical life.
Viscusi and Aldy (2003, Document ID 1220) performed a meta-analysis on
49 wage-risk studies and concluded that the confidence interval upper
bound on the income elasticity did not exceed 1.0 and that the point
estimates across a variety of model specifications ranged between 0.5
and 0.6.\119\ Applied to a long-term increase in per capita income of
about 2.7 percent a year, this would suggest a value of ``k'' of about
1.5 percent a year.
---------------------------------------------------------------------------

    \119\ These results conflict with the more recent work by Hall
and Jones (2007) (Document ID 0720), which concludes that the income
elasticity of the value of life should be larger than 1.
---------------------------------------------------------------------------

    More recently, Kniesner, Viscusi, and Ziliak (2010, Document ID
0767), using panel data quintile regressions, developed an estimate of
the overall income elasticity of the value of a statistical life of
1.44. Applied to a long-term increase in per capita income of about 2.7
percent a year, this would suggest a value of ``k'' of about 3.9
percent a year.
    Based on the preceding discussion of these three approaches for
estimating the annual increase in the value of the benefits of the
final rule and the fact that the estimated increase in real per capita
income in the United States has flattened in recent years and could
remain so, OSHA has selected a conservative value for ``k'' of
approximately 2 percent a year over the next 60 years.
    Thus, based on the best current thinking and data on willingness to
pay and its relationship to income elasticity as income increases, OSHA
concludes that a 2 percent increase in benefits per year, as measured
by a corresponding anticipated increase in VSL, is a reasonable, mid-
range estimate. However, OSHA recognizes the uncertainties surrounding
these estimates and has subjected them to sensitivity analysis, as
discussed below.
    Accordingly, OSHA concludes that the rising value, over time, of
health benefits is a real phenomenon that should be taken into account
in estimating the annualized benefits of the final rule. Table VII-4,
in the following section, and the monetized benefits estimates that
follow it, show estimates of the monetized benefits of the silica rule
with this adjustment integrated into the valuation. OSHA provides a
sensitivity analysis of the effects of this approach later in this
chapter.
d. The Monetized Benefits of the Final Rule
    Table VII-27 presents the estimated annualized (over 60 years,
using a 0 percent discount rate) benefits from each of these components
of the valuation, and the range of estimates, based on risk model
uncertainty (notably in the case of lung cancer), and the range of
uncertainty regarding valuation of morbidity. As shown, the full range
of monetized benefits, undiscounted, for the final PEL of 50 [micro]g/
m\3\ runs from $7.3 billion annually, in the case of the lowest
estimate of lung cancer risk and the lowest valuation for morbidity, up
to $19.3 billion annually, for the highest of both. Note that the value
of total benefits is more sensitive to the valuation of morbidity
(ranging from $7.9 billion to $18.5 billion, given estimates at the
midpoint of the lung cancer models) than to the lung cancer model used
(ranging from $12.5 to $13.8

billion, given estimates at the midpoint of the morbidity
valuation).\120\
---------------------------------------------------------------------------

    \120\ As previously indicated, these valuations include all the
various estimated health endpoints. In the case of mortality this
includes lung cancer, non-malignant respiratory disease and end-
stage renal disease. The Agency highlighted lung cancers in this
discussion due to the model uncertainty. In calculating the
monetized benefits, the Agency is typically referring to the
midpoint of the high and low ends of potential valuation--in this
case, the undiscounted midpoint of $7.7 billion and $19.5 billion.
---------------------------------------------------------------------------

    This result comports with the very wide range of valuation for
morbidity. At the low end of the valuation range, the total value of
benefits is dominated by mortality ($7.7 billion out of $7.9 billion at
the case frequency midpoint), whereas at the high end the majority of
the benefits are related to morbidity ($11.2 billion out of $18.7
billion at the case frequency midpoint). Also, the analysis illustrates
that most of the morbidity benefits are related to silicosis cases that
are not ultimately fatal. At the valuation and case frequency midpoint
of $13.3 billion, $7.7 billion in benefits are related to mortality,
$2.0 billion are related to morbidity preceding mortality, and $3.5
billion are related to morbidity not preceding mortality.
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BILLING CODE 4510-26-C
3. Discounting of Monetized Benefits
    As previously noted, the estimated stream of benefits arising from
the final silica rule is not constant from year to year, both because
of the 45-year delay after the rule takes effect until all active
workers obtain reduced silica exposure over their entire working lives
and because of, in the case of lung cancer, a 15-year latency period
between reduced exposure and a reduction in the probability of disease.
An appropriate discount rate \121\ is needed to reflect the timing of
benefits over the 60-year period after the rule takes effect and to

allow conversion to an equivalent steady stream of annualized
benefits.\122\
---------------------------------------------------------------------------

    \121\ Here and elsewhere throughout this section, unless
otherwise noted, the term ``discount rate'' always refers to the
real discount rate--that is, the discount rate net of any
inflationary effects.
    \122\ This essential point was missed in a comment by Dr.
Ruttenberg, which claimed that OSHA's estimates of the benefits of
an avoided fatality were forty percent below the VSL estimate of
$8.7 million (in 2009 dollars) that the Agency was using (Document
ID 2256, Attachment 4, p. 9). The difference is due to the fact that
the avoided fatalities occurred over a 60 year period and had to be
discounted.
---------------------------------------------------------------------------

a. Alternative Discount Rates for Annualizing Benefits
    Following OMB (2003) guidelines (Document ID 1493], OSHA has
estimated the annualized benefits of the final rule using separate
discount rates of 3 percent and 7 percent. Consistent with the Agency's
own practices in recent final and final rules, OSHA has also estimated,
for benchmarking purposes, undiscounted benefits--that is, benefits
using a zero percent discount rate.
    The ``appropriate'' or ``preferred'' discount rate to use to
monetize health benefits is a controversial topic, which has been the
source of scholarly economic debate for several decades.\123\ However,
in simplest terms, the basic choices involve a social opportunity cost
of capital approach or social rate of time preference approach. OSHA
analyzes the benefits of this rule under both approaches.
---------------------------------------------------------------------------

    \123\ For a more detailed discussion of the major issues, see,
for example, Lind (1982a, 1982b, and 1990, Document ID1622); EPA
(2000a, Document ID 1327, Chapter 6); and OMB (2003, Document ID
1493, pp. 31-37).
---------------------------------------------------------------------------

    The social opportunity cost of capital approach reflects the fact
that private funds spent to comply with government regulations have an
opportunity cost in terms of foregone private investments that could
otherwise have been made. The relevant discount rate in this case is
the pre-tax rate of return on the foregone investments (Lind, 1982b,
pp. 24-32) (Document ID 1622).
    The rate of time preference approach is intended to measure the
tradeoff between current consumption and future consumption, or in the
context of the final rule, between current benefits and future
benefits. The individual rate of time preference is influenced by
uncertainty about the availability of the benefits at a future date and
whether the individual will be alive to enjoy the delayed benefits. By
comparison, the social rate of time preference takes a broader view
over a longer time horizon--ignoring individual mortality and the
riskiness of individual investments (which can be accounted for
separately).\124\
---------------------------------------------------------------------------

    \124\ It is not always possible to explicitly model all forms of
uncertainty that are relevant to a regulatory cost-benefit analysis
(e.g., medical innovations that allow for more successful treatment
of illnesses or changes in industrial practices or locations that in
turn change the exposure profile of workers subject to a
regulation). Because these uncertainties tend to increase as the
time horizon being analyzed lengthens, application of a discount
rate provides a reduced-form approach to less heavily weighting the
least-certain estimated benefits and costs.
---------------------------------------------------------------------------

    A usual method for estimating the social rate of time preference is
to calculate the post-tax real rate of return on long-term, risk-free
assets, such as U.S. Treasury securities (OMB, 2003, Document ID 1493).
A variety of studies have estimated these rates of return over time and
reported them to be in the range of approximately 1-4 percent.
    OMB Circular A-4 (2003) recommends using discount rates of 3
percent (representing the social rate of time preference) and 7 percent
(a rate estimated using the social cost of capital approach) to
estimate benefits and net benefits (Document ID 1493). Ronald White of
the Center for Effective Government endorsed the use of a 3 percent
discount rate--since it ``appropriately reflects a social rate of time
preference approach consistent with recommendations for benefits
evaluation by the U.S. Environmental Protection Agency'' (Document ID
2341, pp. 3-4). Charles Gordon argued for a 0 percent discount rate:

    The economic literature indicates that the social discount rate
should be 2 percent or 3 percent. But I believe the social discount
rate should be zero, because if you were asked the question, do you
want yourself saved from crystalline silica exposure . . . or do you
want your son to be saved from crystalline silica death 20 years
from now, you could not answer that question. You could not give a
preference (Document ID 3588, Tr. 3789-90).

    In acknowledgement of OMB Circular A-4 (2003, Document ID 1493),
OSHA presents benefits and net benefits estimates using discount rates
of 3 percent (representing the social rate of time preference) and 7
percent (a rate estimated using the social cost of capital approach).
The weight of the evidence favors using a discount rate of 3 percent or
less, and that 3 percent is one of the options permitted by OMB, the
Agency is using a 3 percent discount rate to display its primary
estimates of benefits under the social rate of time preference method.
b. Summary of Annualized Benefits Under Alternative Discount Rates
    Table VII-28a through Table VII-28d presents OSHA's estimates of
the sum of the annualized benefits of the final rule, under various
occupational tenure assumptions, using alternative discount rates of 0,
3, and 7 percent, with a breakout between construction and general
industry/maritime, with each table presenting these results for a
different tenure level. All of these benefits calculations reflect
willingness-to-pay values that, as previously discussed, increase in
real value at 2 percent a year.
    Given that the stream of benefits extends out 60 years, the value
of future benefits is highly sensitive to the choice of discount rate.
As previously established in Table VII-27, the undiscounted benefits
(i.e., using the 0 percent discount rate) for the scenario in which
workers are uniformly exposed to silica for 45 years range from $7.3
billion to $19.3 billion annually. In Table VII-28a, for 45 years
tenure, using a 3 percent discount rate, the annualized benefits range
from $4.8 billion to $12.6 billion. Using a 7 percent discount rate,
the annualized benefits range from $2.7 billion to $6.9 billion. As can
be seen, going from undiscounted benefits (with a midpoint of $13.3
billion) to benefits calculated at a 7 percent discount rate (with a
midpoint of $4.8 billion) has the effect of cutting the annualized
benefits of the final rule by 64 percent.
    Comparing across tenure levels for representative benefits, Table
VII-28a for 45 years tenure has total benefits at the midpoint estimate
of $8.7 billion at a 3 percent discount rate and $4.8 billion at 7
percent discount rate. Table VII-28b for 25 years tenure has total
benefits at the midpoint estimate of $10.0 billion at a 3 percent
discount rate and $5.5 billion at 7 percent discount rate. Table VII-
28c for 13 years tenure has total benefits at the midpoint estimate of
$12.3 billion at a 3 percent discount rate and $6.8 billion at 7
percent discount rate. Finally, Table VII-28d for 6.6 years tenure has
total benefits at the midpoint estimate of $16.1 billion at a 3 percent
discount rate and $9.0 billion at 7 percent discount rate.
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BILLING CODE 4510-26-C
4. Estimates of Net Benefits of the Final Rule
    OSHA has estimated as shown in Table VII-29, the monetized and
annualized net benefits of the final rule (with a PEL of 50 [micro]g/
m\3\ in general industry/maritime and construction and Table 1
governing almost all controls in Construction), based on the benefits
model and costs previously presented in this chapter and in Chapter V
of the FEA. Net benefits are the difference between benefits and costs.
    Table VII-29 shows net benefits using alternative discount rates of
0, 3, and 7 percent for benefits and costs, including the previously
discussed adjustment to monetized benefits to reflect increases in real
per capita income over time.
    As previously noted, the OSH Act requires the Agency to set
standards based on eliminating significant risk to the extent feasible.
An alternative criterion of maximizing net (monetized) benefits may
result in very different regulatory outcomes. Thus, this analysis of
estimated net benefits has not been used by OSHA as the basis for its
decision concerning the choice of a PEL or of ancillary requirements
for the final silica rule. Instead, it is provided pursuant to
Executive Orders 12866 and 13563. OSHA has used the 45 year
occupational tenure in its main analysis. OSHA has also examined other
possible tenures and provided the results. The occupational tenure
results are such the benefits are higher the shorter the occupational
tenure. Examination of shorter tenure would actually increase the net
benefits because more workers are exposed to silica, albeit for a
shorter time each.
    Table VII-29 also shows results of estimates of annualized net
benefits for an alternative PEL of 100 [micro]g/m\3\. Under this
regulatory alternative, the PEL would be changed from 50 [micro]g/m\3\
to 100 [micro]g/m\3\ for all industries covered by the final rule, and
the action level would be changed from 25 [micro]g/m\3\ to 50 [micro]g/
m\3\ (thereby keeping the action level at one-half of the PEL). The
ancillary provisions of the standard, such as the medical surveillance
provisions, would remain the same in this alternative as in this final
rule, but would be impacted by factors such as changes in respirator
use and effects on other provisions such as medical surveillance. For
example, in the construction sector where medical surveillance
requirements are triggered by respirator use, a reduction in respirator
use would result in a decrease in the costs associated with medical
surveillance. Under this alternative, OSHA determined in the PEA that
Table 1 requirements for respirator use would be eliminated and that
only abrasive blasters and some underground construction workers, which
are not included in Table 1, would be required to wear respirators.
However, the number of mortalities and morbidities would rise if
workers were exposed to higher levels of silica. OSHA did not receive
comment on its analysis of this alternative.
    As previously noted in this summary, the choice of discount rate
for annualizing benefits has a significant effect on annualized
benefits. The same is true for net benefits. For example, the net
benefits using a 7 percent discount rate for benefits are considerably
smaller than the net benefits using a 0 percent discount rate,
declining by more than half to two-thirds under all scenarios.
(Conversely, as noted in Chapter V of the FEA, the choice of discount
rate for annualizing costs has only a very minor effect on annualized
costs.)

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    The estimates of net benefits in Table VII-29 show that:
     While the net benefits of the final rule vary
considerably--depending on the choice of discount rate used to
annualize benefits and on whether the calculated benefits are in the
high, midpoint, or low range--benefits exceed costs for the 50 [mu]g/
m\3\ PEL in all scenarios that OSHA considered (i.e., the highest
estimate for costs is lower than the lowest estimate for benefits).
     The Agency's best estimate of the net annualized benefits
of the final rule--using a uniform discount rate for both benefits and
costs of 3 percent--and cognizant of the uncertainties inherent in the
analysis, is between $3.8 billion and $11.6 billion, with a midpoint
value of $7.7 billion.

     The alternative of a 100 [mu]g/m\3\ PEL has lower net
benefits under all assumptions, relative to the 50 [mu]g/m\3\ PEL.
However, for this alternative PEL, benefits were also found to exceed
costs in all scenarios that OSHA considered.
    One commenter, the Mercatus Institute, argued that the benefits for
the proposed rule were overestimated due to OSHA's assumption of full
compliance, and that this simultaneously underestimated costs, since
the cost of complying with existing rules is assumed away. This
commenter stated that the Agency should not assume that firms will
necessarily comply with the Agency's rules and the benefits estimates
should therefore be lower (Document ID 1819, p. 9). OSHA makes three
points in response. First, the argument is logically inconsistent--if
the Agency did not assume full compliance with the previous PELs and
assumes compliance with the new PEL, as Mercatus advocates, it is true
that the estimated costs would increase, but so would the estimated
benefits. Second, the logic for the Mercatus Institute's argument seems
to be undercut by the Mercatus Institute's own observation that the
Agency has had success in reducing silicosis, which suggests that in
the long run, at least, firms actually do comply with OSHA rules
(Document ID 1819, pp. 4-5). Finally, as discussed in the engineering
controls section of Chapter V of the FEA, the Agency has determined
that the best way for it to calculate costs and benefits is to estimate
the incremental costs and benefits of the standard by assuming full
compliance. OSHA also emphasizes that the compliance assumption applies
to both costs and benefits so that the comparison of one to the other
is not necessarily unduly weighted in either direction (an exception
would be the counterfactual scenario in which extremely high non-
compliance by a few employers changed benefits estimates substantially
but cost estimates only slightly).\125\
---------------------------------------------------------------------------

    \125\ If this rulemaking has the potential to increase
compliance with existing regulations, it would be appropriate for
the analysis conducted under Executive Order 12866 and 13563 to
include both cost and benefits estimates that reflect the new
compliance. This is not, however, a legal requirement of the OSH
Act. OSHA knows of no way to make such estimates and lacks any
persuasive evidence in this rulemaking record that this rulemaking
would affect compliance with the preceding PEL.
---------------------------------------------------------------------------

Estimates of Incremental Benefits of the Final Rule
    Incremental costs and benefits are those that are associated with
increasing the stringency of the standard. A comparison of incremental
benefits and costs provides an indication of the relative efficiency of
the final PEL and the alternative PEL. Again, OSHA has conducted these
calculations for informational purposes only and has not used this
information as the basis for selecting the PEL for the final rule.
    Tables VII-30A and VII-30B show result of estimates of the costs
and benefits of reducing exposure levels from the preceding PELs of
approximately 250 [micro]g/m\3\ (for construction and maritime) and 100
[micro]g/m\3\ (for general industry) to the final rule PEL of 50
[micro]g/m\3\ and to the alternative PEL of 100 [micro]g/m\3\, using
the alternative discount rates of 3 and 7 percent. These tables also
introduce a second alternative PEL. Under this second alternative
standard, addressed in Tables VII-30A and VII-30B, the PEL would be
lowered from 50 [micro]g/m\3\ to 25 [micro]g/m\3\ for all industries
covered by the final rule, while the action level would remain at 25
[micro]g/m\3\ (because of difficulties in accurately measuring exposure
levels below 25 [micro]g/m\3\). For the construction sector under this
second alternative, Table 1 requirements would also be modified to
include respiratory protection for all workers covered under Table 1
(because all exposures for Table 1 activities are assumed to be above
25 [micro]g/m\3\), and all these covered workers would be subject to
the medical surveillance provision.\126\
---------------------------------------------------------------------------

    \126\ As with general industry and maritime employees, the
limited number of construction workers not covered by Table 1 and
estimated to exceed 25 [micro]g/m\3\ currently, such as abrasive
blasters, are assumed to need respiratory protection under this
alternative.
---------------------------------------------------------------------------

    Table VII-30A breaks out costs by provision and benefits by type of
disease and by morbidity/mortality, while Table VII-30B breaks out
costs and benefits by major industry sector or construction task
sector. As Table VII-30A shows, at a discount rate of 3 percent, a PEL
of 50 [micro]g/m\3\, relative to a PEL of 100 [micro]g/m\3\, imposes
incremental costs of $381 million per year; incremental benefits of
$4.3 billion per year, and additional net benefits of $3.9 billion per
year. The final PEL of 50 [micro]g/m\3\ also has higher net benefits
than 100 [micro]g/m\3\ either at a 3 percent or 7 percent discount
rate.
    Table VII-30B continues this incremental analysis but with
breakdowns between construction and general industry/maritime. As
shown, both sectors show strong positive net benefits, which are
greater for the final PEL of 50 [micro]g/m\3\ than the alternative of
100 [micro]g/m\3\.
    The estimates in Tables VII-30A and VII-30B indicate that, across
all discount rates, there are net benefits to be achieved by lowering
exposures from the preceding PEL (250 [mu]g/m\3\ or 100 [mu]g/m\3\) to
100 [mu]g/m\3\ and then, in turn, lowering them further to 50 [mu]g/
m\3\ and then to 25 [mu]g/m\3\, and the lower the PEL, the greater the
net benefits.\127\ Net benefits decline across all incremental changes
in PELs as the discount rate for annualizing benefits increases. The
incremental net benefit of reducing the PEL from 100 [mu]g/m\3\ to 50
[mu]g/m\3\ is greater than the incremental net benefit of reducing the
PEL from 50 [mu]g/m\3\ to 25 [mu]g/m\3\ under both the 3 percent
discount rate and the 7 percent discount rate.
---------------------------------------------------------------------------

    \127\ The lowest PEL considered as an alternative was 25 [mu]g/
m\3\. In addition, the costs exceed the benefits using the 7 percent
discount rate for the 100 [mu]g/m\3\ alternative, since quantified
benefits for the FEA are based entirely on the various quantitative
risk assessments, and the PEL for general industry is already set at
100 [mu]g/m\3\. (There would, however, be net benefits for
construction.) As noted previously, the Agency is claiming no
quantified benefits for the various ancillary provisions, such as
medical surveillance.
---------------------------------------------------------------------------

    However, the majority of the benefits and costs that OSHA estimates
for the final rule (PEL of 50 [mu]g/m\3\) are from the initial effort
to lower exposures from the preceding PEL of 250 [mu]g/m\3\ in both
construction and maritime to 100 [mu]g/m\3\, as shown in the 100 [mu]g/
m\3\ column and the Incremental Costs/Benefits column between the 100
[mu]g/m\3\ column and the 50 [mu]g/m\3\ column in Table VII-30A. The
majority of the costs and benefits attributable to lowering exposures
to 100 [mu]g/m\3\ are in the construction industry. OSHA did not
estimate any costs or benefits for general industry employers lowering
exposures to an alternative of 100 [mu]g/m\3\ because the preceding PEL
was already 100 [mu]g/m\3\, but a relatively small amount of costs and
benefits would be attributed to maritime employers lowering exposures
to the alternative of 100 [mu]g/m\3\ from the preceding PEL of 250
[mu]g/m\3\. Because a single standard would cover both general industry
and maritime employers, those costs and benefits are grouped together
in Table VII-30A and VII-30B.
    In addition to examining alternative PELs, OSHA also examined
alternatives to other provisions of the standard. These alternatives
are discussed in the following Chapter VIII of the FEA: Regulatory
Alternatives.
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BILLING CODE 4510-26-C

5. Sensitivity Analysis
    In this section, OSHA presents the results of two different types
of sensitivity analysis. In the first type of sensitivity analysis,
OSHA made a series of isolated changes to individual cost and benefit
input parameters in order to determine their effects on the Agency's
estimates of annualized costs, annualized benefits, and annualized net
benefits. In the second type of sensitivity analysis--a so-called
``break-even'' analysis--OSHA also investigated isolated changes to
individual cost and benefit input parameters, but with the objective of
determining how much they would have to change for annualized costs to
equal annualized benefits.
    Again, the Agency has conducted these calculations for
informational purposes only and has not used these results as the basis
for selecting the PEL for the final rule.
a. Analysis of Isolated Changes to Inputs
    The methodology and calculations underlying the estimation of the
costs and benefits associated with this rulemaking are generally linear
and additive in nature. Thus, the sensitivity of the results and
conclusions of the analysis will generally be proportional to isolated
variations a particular input parameter. For example, if the estimated
time that employees need to travel to (and from) medical screenings is
doubled, the corresponding labor costs double as well.
    OSHA evaluated a series of such changes in input parameters to test
whether and to what extent the general conclusions of the economic
analysis held up. OSHA first considered changes to input parameters
that affected only costs and then changes to input parameters that
affected only benefits. Each of the sensitivity tests on cost
parameters had only a very minor effect on total costs or net costs.
Much larger effects were observed when the benefits parameters were
modified; however, in all cases, net benefits remained significantly
positive. On the whole, OSHA found that the conclusions of the analysis
are reasonably robust, as changes in any of the cost or benefit input
parameters still show significant net benefits for the final rule. The
results of the individual sensitivity tests are summarized in Table
VII-31A and B and are described in more detail below.
    OSHA has tailored the sensitivity analysis to examine issues raised
by commenters, particularly with respect to costs. (For more detail,
see Chapter V of the FEA.) For each alternative, the estimated cost
increase is equivalent to the estimated decrease in net benefits
(except for minor rounding discrepancies). For instance, in the first
example of sensitivity testing, when OSHA doubled the estimated portion
of the affected self-employed population from 25 to 50 percent, and
estimates of other input parameters remained unchanged, Table VII-31A
shows that the estimated total costs of the final rule increased by
$17.9 million annually, or by about 1.7 percent, while estimated net
benefits also declined by $17.9 million, from $7,657 million to $7,639
million annually.
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    In the second example, OSHA doubled the estimated familiarization
time needed to understand the requirements of the new standard

relative to OSHA's best estimate, which ranged from 4 to 40 hours
depending on establishment size (see Chapter V for more detail). As
shown in Table VII-31A, if OSHA's estimates of other input parameters
remained unchanged, the total estimated costs of the final rule
increased by $16.0 million annually, or by about 1.5 percent, while net
benefits declined by the same amount annually, from approximately
$7,657 million to $7,641 million annually.
    In the third example, OSHA doubled the estimated daily amount of
housekeeping per worker necessary to comply with the standard, from 10
minutes to 20 minutes. As shown in Table VII-31A, if OSHA's estimates
of other input parameters remained unchanged, the total estimated costs
of the final rule increased by $12.5 million annually, or by about 1.2
percent, while net benefits declined by the same amount annually, from
approximately $7,657 million to $7,645 million annually.
    In the fourth example, OSHA examined the effect of increasing its
estimate of the frequency with which thorough cleaning of the workplace
would be performed in general industry. The Agency examined the effect
of increasing the frequency from only one initial thorough cleaning to
the initial cleaning plus an annual thorough cleaning, or alternately,
a thorough cleaning every 5 years. As shown in Table VII-31A, if
thorough cleaning were an annual cost, the total estimated costs of the
final rule increased by $17.2 million annually, or by about 1.7
percent, while net benefits declined by the same amount annually, from
$7,657 million to $7,640 million annually. In the second variation of
this test, for a thorough cleaning every 5 years, as shown in Table
VII-31A, the increase in annual costs is only 0.2 percent.
    In the fifth example, OSHA increased its estimate of respirator
use. In Chapter V of the FEA, OSHA explained that it calculated the
costs of respirators for general industry and maritime workers who will
still be exposed above the PEL after all feasible controls are in
place. In addition, to be conservative, OSHA added costs to provide
respirators to 10 percent of the remaining population. For this
sensitivity test, OSHA doubled its estimate of the amount of additional
respirator use in general industry from 10 percent to 20 percent. As
shown in Table VII-31A, the total estimated costs of the final rule
increased by $20.0 million annually, or by about 1.9 percent, while net
benefits decreased by the same amount annually, from approximately
$7,657 million to $7,637 million annually.
    In the sixth example, reflecting in part the range of comments the
Agency received on the issue (discussed in detail in Chapter V), OSHA
explored the effect of increasing, and alternately decreasing, by 50
percent the size of the productivity impact arising from the use of
engineering controls in construction. As shown in Table VII-31A, if
OSHA's estimates of other input parameters remained unchanged, under
the first variation, the total estimated costs of the final rule
increased by $99.6 million annually, or by about 9.7 percent, while net
benefits declined by the same amount annually, from $7,657 million to
$7,558 million annually. Under the second variation, the decrease in
costs and increase in net benefits would be of the same magnitude, with
final estimated net benefits rising to $7,757 million.
    As shown in Table VII-31B, OSHA also performed sensitivity tests on
several input parameters used to predict the benefits of the final
rule. In the first two tests, in an extension of results previously
presented in Table VII-27, the Agency examined the effect on annualized
net benefits of employing the high-end estimate of the benefits, as
well as the low-end estimate. As discussed previously, the Agency
examined the sensitivity of the benefits to both the valuation of
individual silica-related disease cases prevented, as well as the
number of lung cancer deaths prevented. Table VII-31B presents the
effect on annualized net benefits of using the extreme values of these
ranges, the high count of cases prevented and the high valuation per
case prevented, and the low count and the low valuation per case
prevented. As indicated, using the high estimate of cases prevented and
their valuation, the benefits rise by 45 percent to $12.6 billion,
yielding net benefits of $11.5 billion. For the low estimate of both
cases prevented and their valuation, the benefits decline by 45
percent, to $4.8 billion, yielding net benefits of $3.8 billion.
    In the third sensitivity test of benefits, OSHA examined the effect
of raising the discount rate for benefits to 7 percent. The fourth
sensitivity test of benefits examined the effect of removing the
adjustment to monetized benefits to reflect increases in real per
capita income over time. The results of the first of these sensitivity
tests for net benefits was previously shown in Table VII-29 and is
repeated in Table VII-31B. Raising the interest rate to 7 percent
lowers the estimated benefits by 45 percent, to $4.8 billion, yielding
annualized net benefits of $3.8 billion. Removing the two-percent
annual increase to monetized benefits to reflect increases in real per
capita income over time decreases the benefits by 50 percent, to $4.3
billion, yielding net benefits of $3.3 billion.
b. ``Break-Even'' Analysis
    OSHA also performed sensitivity tests on several other parameters
used to estimate the net costs and benefits of the final rule. However,
for these, the Agency performed a ``break-even'' analysis, asking how
much the various cost and benefits inputs would have to vary in order
for the costs to equal, or break even with, the benefits. The results
are shown in Table VII-32.

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    OSHA also performed sensitivity tests on several other parameters
used to estimate the net costs and benefits of the final rule. However,
for these, the Agency performed a ``break-even'' analysis, examining
how much the various cost and benefits inputs would have to vary in
order for the costs to equal, or break even with, the benefits

estimated. The results are shown in Table VII-32.
    In the first break-even test on cost estimates, OSHA examined how
much costs would have to increase in order for costs to equal estimates
benefits. As shown in Table VII-32, this point would be reached if
costs increased by $7.7 billion.
    In a second test, looking specifically at the estimated engineering
control costs, the Agency found that these costs would also need to
increase by $7.7 billion for costs to equal estimates benefits.
    In a third sensitivity test, on benefits, OSHA examined how much
its estimated monetary valuation of an avoided illness or an avoided
fatality would need to be reduced in order for the costs to equal the
benefits. Since the total valuation of prevented mortality and
morbidity are each estimated to exceed at least $2.6 billion, while the
estimated costs are $1.0 billion, an independent break-even point for
each is impossible. In other words, for example, if no value is
attached to an avoided illness associated with the rule, but the
estimated value of an avoided fatality is held constant, the rule still
has substantial net benefits. Only through a reduction in the estimated
net value of both components is a break-even point possible.
    OSHA, therefore, examined how large an across-the-board reduction
in the monetized value of all avoided illnesses and fatalities would be
necessary for the benefits to equal the costs. As shown in Table VII-
32, for costs to equal estimated benefits, the estimated value per life
saved would have to decline to $1.10 million per life saved, and an
equivalent percentage reduction to about $0.3 million per illness
prevented.
    In a break-even sensitivity test, OSHA estimated how many silica-
related fatalities and illnesses would be required for benefits to
equal costs. As shown in Table VII-32, a reduction of 88 percent,
relative to the morbidity and mortality estimates is required to reach
the break-even point--566 fewer fatalities prevented annually, and 809
fewer silica-related illnesses prevented annually.

H. Regulatory Alternatives

    This section discusses several major regulatory alternatives to the
final OSHA silica standard, pursuant to Executive Orders 13653 and
12866. The presentation of regulatory alternatives in this chapter
serves two important functions. The first is to demonstrate that OSHA
explored less costly ways (compared to the final rule) to provide
workers an adequate level of protection from exposure to respirable
crystalline silica. The second is tied to the Agency's statutory
requirement, which underlies the final rule, to reduce significant risk
to the extent feasible. If OSHA had been unable to support its findings
of significant risk and feasibility based on evidence presented during
notice and comment, the Agency would then have had to consider
regulatory alternatives that do satisfy its statutory obligations.
    Each regulatory alternative presented here is described and
analyzed relative to the final rule. Where relevant, the Agency notes
that some regulatory alternatives are not permissible based on the
required legal findings OSHA has made regarding significant risk and
feasibility. The regulatory alternatives have been organized into four
categories similar to those used in the PEA: (1) Alternative PELs to
the new PEL of 50 [mu]g/m\3\; (2) regulatory alternatives that affect
ancillary provisions; (3) a regulatory alternative that would modify
the methods of compliance; and (4) regulatory alternatives concerning
when different provisions of the final rule would take effect.
Alternative PELs
    OSHA selected a new PEL for respirable crystalline silica of 50
[mu]g/m\3\ for all industries covered by the final rule and developed
and included Table 1 for many work activities within the construction
sector. The final rule is based on the requirements of the Occupational
Safety and Health Act (OSH Act) and court interpretations of the Act.
For health standards issued under section 6(b)(5) of the OSH Act (29
U.S.C. 655(b)(5)), OSHA is required to promulgate a standard that
reduces the risk of material impairment of health to the extent that it
is technologically and economically feasible to do so (see Section II,
Pertinent Legal Authority, for a full discussion of the legal
requirements for promulgating new health standards under the OSH Act).
    OSHA has conducted an extensive review of the literature on adverse
health effects associated with exposure to respirable crystalline
silica. The Agency has also developed estimates of the risk of silica-
related diseases assuming exposure over a working lifetime at the final
PEL and action level, as well as at OSHA's preceding PELs. These
analyses are presented in a background document entitled ``Respirable
Crystalline Silica--Health Effects Literature Review and Preliminary
Quantitative Risk Assessment'' and its final findings are described in
this preamble in Section V, Health Effects, and Section VI, Final
Quantitative Risk Assessment and Significance of Risk. The available
evidence indicates that employees exposed to respirable crystalline
silica well below the previous PELs are at increased risk of lung
cancer mortality and silicosis mortality and morbidity. Occupational
exposures to respirable crystalline silica also can result in the
development of kidney and autoimmune diseases and in death from other
nonmalignant respiratory diseases. As discussed in Section VI
Significance of Risk, in this preamble, OSHA finds that worker exposure
to respirable crystalline silica at the previous and new PELs
constitutes a significant risk and that the final standard will
substantially reduce this risk.
    Section 6(b) of the OSH Act (29 U.S.C. 655(b)) requires OSHA to
determine that its standards are technologically and economically
feasible. OSHA's examination of the technological and economic
feasibility of the final rule is presented in the FEA, and is
summarized in this section (Section VII) of this preamble. For general
industry and maritime, OSHA has concluded that the final PEL of 50
[mu]g/m\3\ is technologically feasible for all affected industries. In
other words, OSHA has found that engineering and work practice controls
will be sufficient to reduce and maintain silica exposures to the PEL
of 50 [mu]g/m\3\ or below in most operations most of the time in the
affected industries in general industry, and the rule is also feasible
in maritime (feasibility for maritime (shipyards) partly depends on it
being subject to other standards regulating abrasive blasting). For
those few operations where the PEL cannot be achieved even when
employers install all feasible engineering and work practice controls,
employers in general industry and maritime can supplement controls with
respirators to achieve exposure levels at or below the PEL.
    For construction, determined that the engineering and work practice
controls specified in Table 1 are feasible for all affected activities
and in most cases will keep exposures at or below 50 [mu]g/m\3\ most of
the time. For those few activities where the engineering and work
practice controls specified in Table 1 are not sufficiently protective
of worker health, Table 1 specifies respirator use to supplement those
controls. A limited number of activities, such as tunneling and
abrasive blasting, are not dealt with under Table 1, but are governed
more directly by the PEL of 50 [mu]g/m\3\, as in general industry and
maritime. For construction, while a few tasks like abrasive blasting
and those specified on Table 1 as requiring respirators cannot

achieve the PEL most of the time with engineering and work practice
controls alone, OSHA has concluded that the PEL of 50 [mu]g/m\3\ is
technologically feasible for the construction industry overall because
most operations can meet the PEL using the specified controls in Table
1or under the traditional approach.
    OSHA developed quantitative estimates of the compliance costs of
the final rule for each of the affected industry sectors. The estimated
compliance costs were compared with industry revenues and profits to
provide a screening analysis of the economic feasibility of complying
with the revised standard and an evaluation of the potential economic
impacts. Industries with unusually high costs as a percentage of
revenues or profits were further analyzed for possible economic
feasibility issues. After performing these analyses, OSHA has concluded
that compliance with the requirements of the final rule would be
economically feasible in every affected industry sector.
    OSHA has examined two regulatory alternatives (named Regulatory
Alternatives #1 and #2) that would modify the PEL for the final rule.
Under Regulatory Alternative #1, the final PEL would be changed from 50
[micro]g/m\3\ to 100 [micro]g/m\3\ for all industry sectors covered by
the rule, and the action level would be changed from 25 [micro]g/m\3\
to 50 [micro]g/m\3\ (thereby keeping the action level at one-half of
the PEL). Under Regulatory Alternative #2, the new PEL would be lowered
from 50 [micro]g/m\3\ to 25 [micro]g/m\3\ for all industry sectors
covered by the rule, while the action level would remain at 25
[micro]g/m\3\ (because of difficulties in accurately measuring exposure
levels below 25 [micro]g/m\3\). For the construction sector under this
second alternative, Table 1 requirements would also be modified to
include respiratory protection for all workers covered under Table 1
(because none are expected to be mostly under 25 [micro]g/m\3\ for any
of the tasks), and all these covered workers would be subject to the
medical surveillance provision.
    Tables VII-33 and VII-34 present, for informational purposes, the
estimated costs, estimated benefits, and estimated net benefits of the
final rule under the new PEL of 50 [mu]g/m\3\ and for the regulatory
alternatives of a PEL of 100 [mu]g/m\3\ and a PEL of 25 [mu]g/m\3\
(Regulatory Alternatives #1 and #2), using alternative discount rates
of 3 and 7 percent. These two tables also present the incremental
costs, the estimated incremental benefits, and the estimated
incremental net benefits of going from a PEL of 100 [mu]g/m\3\ to the
new PEL of 50 [mu]g/m\3\ and then of going from the new PEL of 50
[mu]g/m\3\ to a PEL of 25 [mu]g/m\3\. Table VII-33 breaks out costs by
provision and benefits by type of disease and by morbidity/mortality,
while Table VII-34 breaks out costs and benefits by major industry
sector.
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    As previously noted, Tables VII-33 and VII-34 also show the costs
and estimated benefits of a PEL of 25 [mu]g/m\3\ (Regulatory
Alternative #2), as well as

the incremental costs and benefits of going from the final PEL of 50
[mu]g/m\3\ to a PEL of 25 [mu]g/m\3\. Because OSHA determined that a
PEL of 25 [mu]g/m\3\ would not be feasible (that is, engineering and
work practices would not be sufficient to reduce and maintain silica
exposures to a PEL of 25 [mu]g/m\3\ or below in most operations most of
the time in the affected industries), the Agency did not attempt to
identify engineering controls or their costs for affected industries to
meet this PEL. Instead, for purposes of estimating the costs of going
from a PEL of 50 [mu]g/m\3\ to a PEL of 25 [mu]g/m\3\, OSHA assumed
that all workers exposed between 50 [mu]g/m\3\ and 25 [mu]g/m\3\ would
have to wear respirators to achieve compliance with the 25 [mu]g/m\3\
PEL. OSHA then estimated the associated additional costs for
respirators, exposure assessments, medical surveillance, and regulated
areas (the latter three for ancillary requirements specified in the
final rule).
    As Tables VII-33 and VII-34 show, going from the final rule to
Regulatory Alternative #2 (PEL of 25 [mu]g/m\3\) is estimated to
prevent, annually, an additional 295 silica-related fatalities and an
additional 122 cases of silicosis. These estimates support OSHA's
finding that there is significant risk remaining at the final PEL of 50
[mu]g/m\3\. However, the Agency has determined that a PEL of 25 [mu]g/
m\3\ is not technologically feasible for most sectors or operations,
and for that reason, has not selected it.
Regulatory Alternatives That Affect Ancillary Provisions
    Section 6(b)(7) of the OSH Act, 29 U.S.C. 655(b)(7), requires
standards to prescribe, where appropriate, the monitoring or measuring
of employee exposure for the protections of employees. Section 6(b)(7)
also requires the standards to prescribe, where appropriate, the type
and frequency of medical exams to be provided by employers ``in order
to most effectively determine whether the health of [exposed] employees
is adversely affected by such exposure.'' The final rule contains
several ancillary provisions (provisions other than the PEL), including
requirements for exposure assessment, medical surveillance,
familiarization and training, regulated areas (in general industry and
maritime), and a written exposure control plan.
    OSHA's reasons for including each of the ancillary provisions are
detailed in Section XV of this preamble, Summary and Explanation of the
Standards. In particular, OSHA has determined that requirements for
exposure assessment (or alternately, using specified exposure control
methods for selected construction operations) provide a basis for
ensuring that appropriate measures are in place to limit worker
exposures. Medical surveillance is particularly important because
workers exposed at levels below the new PEL are still at significant
risk of death and illness (OSHA's decision not to lower the PEL further
was due to limitations on technological feasibility, rather than a
determination that significant risk was eliminated at the new PEL).
Medical surveillance will allow for identification of respirable
crystalline silica-related adverse health effects at an early stage so
that appropriate intervention measures can be taken. Regulated areas
and a written exposure control plan are important in part because they
help limit exposure to respirable crystalline silica to as few
employees as possible. Finally, worker training is necessary to inform
employees of the hazards to which they are exposed, along with
associated protective measures, so that employees understand how they
can minimize potential health hazards. Worker training on silica-
related work practices is particularly important in controlling silica
exposures because engineering controls frequently require action on the
part of workers to function effectively.
    As shown in Table VII-33, these ancillary provisions represent
approximately $340 million (or about 35 percent) of the total
annualized costs of the final rule of $962 million (using a 3 percent
discount rate). The three most expensive of the ancillary provisions
are the requirements for medical surveillance, with annualized costs of
$96 million; the requirements for training and familiarization, with
annualized costs of $94 million; and exposure assessment, with
annualized costs of $71 million.
    The requirements for exposure assessment in general industry and
maritime are triggered by the action level. The exposures of workers in
construction for whom all Table 1 requirements have been met do not
have to be assessed, but if Table 1 requirements are not met, the
requirements for exposure assessment in construction would also be
triggered by the action level. As described in this preamble, OSHA has
defined the action level for the standard as an airborne concentration
of respirable crystalline silica of 25 [mu]g/m\3\ calculated as an 8-
hour time-weighted average. In this final rule, as in other OSHA health
standards, the action level has been set at one-half of the PEL.
    As explained in Chapter IV of the FEA, OSHA finds that proper
implementation of engineering and work practice controls, particularly
those specified in Table 1, will eliminate much of the variability in
silica exposure that characterizes baseline conditions in the general
industry, maritime, and construction sectors. OSHA recognizes, however,
that some variability is unavoidable and uncontrollable even with such
controls. Because of this variability of employee exposures to airborne
concentrations of respirable crystalline silica, maintaining exposures
below the action level should provide reasonable assurance that
employees will not be exposed to respirable crystalline silica at
levels above the PEL on days when no exposure measurements are made.
Even when all measurements on a given day fall between the PEL and the
action level, there is some chance that on another day, when exposures
are not measured, actual exposure may exceed the PEL. When exposure
measurements are below the PEL but above the action level, the employer
cannot be certain that employees have not been exposed to respirable
crystalline silica concentrations in excess of the PEL during at least
some part of the work week. Therefore, requiring periodic exposure
measurements when the action level is exceeded provides the employer
with a reasonable degree of confidence in the results of the exposure
monitoring.
    As specified in the final rule, all workers in general industry and
maritime exposed to respirable crystalline silica at or above the
action level of 25 [mu]g/m\3\ are subject to the medical surveillance
requirements. In the construction sector, medical surveillance is
triggered by respirator use for 30 days or more per year (which
generally corresponds to a risk of exposure above 50 [mu]g/m\3\ that
prompted the Table 1 respirator requirement), For the final rule, the
medical surveillance requirements will apply to an estimated 141,594
workers in general industry and 270,581 workers in construction. OSHA
estimates that 989 possible ILO 2/0 silicosis cases will be referred to
specialists annually as a result of this medical surveillance.
    OSHA's conclusion is that the requirements triggered by the action
level will result in a very real and necessary, but non-quantifiable,
reduction in risk beyond that provided by the PEL alone. OSHA has
determined that these ancillary provisions (periodic exposure
assessment, medical surveillance in general industry/maritime) will
reduce significant risk in at least three ways: (1) Providing economic
incentives to employers to

reduce exposures to below 25 [mu]g/m\3\ to avoid the costs of medical
surveillance and exposure monitoring; (2) helping to ensure the PEL is
not exceeded; and (3) providing medical exams to workers exposed at the
action level, resulting in additional specialist referrals for X-ray
findings consistent with silicosis and allowing employees who find out
they have a silica-related disease to take action, such as changing
jobs or wearing a respirator for additional protection. In sum, the
ancillary provisions triggered by the action level in the final rule
provide significant benefits to worker health by providing additional
layers and types of protection to employees exposed to respirable
crystalline silica. Medical surveillance is particularly important for
this rule because those exposed at the action level are still at
significant risk of illness. OSHA did not estimate, and the benefits
analysis does not include, monetary benefits resulting from early
discovery of illness. OSHA's choice of using an action level for
exposure monitoring of one-half of the PEL is based on the Agency's
enforcement experience with other standards, including those for
inorganic arsenic (29 CFR 1910.1018), ethylene oxide (29 CFR
1910.1047), benzene (29 CFR 1910.1028), and methylene chloride (29 CFR
1910.1052).
    In response to comments on the proposed rule and PEA, among other
changes discussed in Chapter V, OSHA added familiarization costs and
increased estimated training costs in the FEA, and increased the cost
of an industrial hygienist when conducting exposure monitoring. These
changes, however, were the result of OSHA revisions to its cost
estimates, not changes to the text of the regulation. Medical
surveillance and exposure assessments were the ancillary provisions
that were the focus of regulatory alternatives in the PEA. For these
reasons, the Agency has examined four regulatory alternatives
(Regulatory Alternatives #3, #4, #5, and #6) involving changes to one
or the other of these two ancillary provisions. These four regulatory
alternatives are defined below and the incremental cost impact of each
is summarized in Table VII-35. In addition, OSHA has qualitatively
considered a regulatory alternative (Regulatory Alternative #7) that
would remove all ancillary provisions.

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    Under Regulatory Alternative #3, the action level would be raised
from 25 [micro]g/m\3\ to 50 [micro]g/m\3\ in the standard for general
industry and maritime, while keeping the PEL at 50 [micro]g/m\3\. As a
result, exposure monitoring and medical surveillance requirements would
be triggered only if workers were exposed above 50 [micro]g/m\3\. No
changes would be made to the construction standard because the medical
surveillance trigger for that standard is respirator use, not an action
level. As shown in Table VII-35, Regulatory Alternative #3 would reduce
the annualized cost of the final rule by about $85 million, using a
discount rate of 3 percent, and about $86 million using a discount rate
of 7 percent.
    Under Regulatory Alternative #4, the action level in general
industry and maritime would remain at 25 [micro]g/m\3\ but

medical surveillance would now be triggered by the PEL, not the action
level. As a result, medical surveillance requirements would be
triggered only if workers in general industry and maritime were exposed
above the PEL of 50 [micro]g/m\3\. No changes would be made to the
construction standard. This alternative is similar to Alternative #3,
but because the action level would remain lower, the amount of exposure
monitoring would not decrease in Alternative #4 (applicable to general
industry and maritime (and for construction employers following the
exposure monitoring method of compliance)), exposure monitoring is
required when levels exceed the action level). As shown in Table VII-
35, Regulatory Alternative #4 would reduce the annualized cost of the
final rule by about $28 million, using a discount rate of 3 percent and
about $29 million using a discount rate of 7 percent).
    Under Regulatory Alternative #5, the only change to the final rule
would be to the medical surveillance frequency requirements. Instead of
requiring qualifying workers to be offered a medical check-up every
three years, an annual medical check-up would be required to be
offered. Assuming all workers will accept this offer, as shown in Table
VII-35, Regulatory Option #5 would increase the annualized cost of the
final rule by about $110 million, using a discount rate of 3 percent
(and by about $108 million, using a discount rate of 7 percent).
    Under Regulatory Alternative #6, medical surveillance would be
triggered by the PEL (in general industry and maritime), not the action
level, and all workers (including in construction) subject to medical
surveillance would be required to have a medical check-up annually
rather than triennially. As shown in Table VII-35, Regulatory
Alternative #6 would cause a net increase of the annualized cost of the
final rule by about $42 million, using a discount rate of 3 percent
(and by about $40 million, using a discount rate of 7 percent).
    While the Agency expects there will be substantial benefits related
to its ancillary provisions, it does not have the same quantitative
basis for estimating benefits, and therefore does not have quantitative
estimates for the benefits of the preceding four regulatory
alternatives.
    The final regulatory alternative affecting ancillary provisions,
Regulatory Alternative #7, would eliminate all of the ancillary
provisions of the final rule, including exposure assessment, medical
surveillance, training, regulated areas, and the written exposure
control plan. This alternative would be difficult to justify legally in
light of 29 U.S.C. 655(b)(5) and (b)(7) along with case law requiring
OSHA to use ancillary provisions to reduce significant risk remaining
at the PEL when these provisions result in more than a de minimis
benefit to workers (see Section II, Pertinent Legal Authority). In any
event, it should be noted that elimination of the ancillary provisions
does not mean that all costs for ancillary provisions would disappear.
In order to meet the PEL, employers would still commonly need to
conduct exposure monitoring, train workers on the use of controls, and
set up some kind of regulated areas (in general industry and maritime)
to indicate where respirator use would be required. It is also likely
that some employers would follow the many recommendations to provide
medical surveillance for employees and establish a written exposure
control plan. OSHA has not attempted to estimate the extent to which
the costs of these activities would be reduced if they were not
formally required.
    OSHA finds that the benefits estimated under the final rule will
not be fully achieved if employers do not implement the ancillary
provisions of the final rule. For example, OSHA believes that the
effectiveness of the final rule depends on regulated areas and the
written exposure control plan to further limit exposures and on medical
surveillance to identify disease cases when they do occur. For
construction work, the written exposure control plan is an integral
part of the overall scheme to protect workers engaged in activities
covered by Table 1. Without this provision, workers would risk
exposures from the activities of others and exposure monitoring would
need to be significantly increased to ensure protection for those
workers.
    Both industry and worker groups have recognized that a
comprehensive standard, as opposed to a PEL alone, is needed to protect
workers exposed to respirable crystalline silica. For example, the
industry consensus standards for crystalline silica, ASTM E 1132--06,
Standard Practice for Health Requirements Relating to Occupational
Exposure to Respirable Crystalline Silica, and ASTM E 2626--09,
Standard Practice for Controlling Occupational Exposure to Respirable
Crystalline Silica for Construction and Demolition Activities, as well
as the draft proposed silica standard for construction developed by the
Building and Construction Trades Department, AFL-CIO, have each
included comprehensive programs. These recommended standards include
provisions for methods of compliance, exposure monitoring, training,
and medical surveillance (Document ID 1466; 1504; 1509.
3. A Regulatory Alternative That Modifies the Methods of Compliance
    The final standard in general industry and maritime requires
employers to implement engineering and work practice controls to reduce
employees' exposures to or below the PEL. Where engineering and/or work
practice controls are insufficient, employers are still required to
implement them to reduce exposure as much as possible, and to
supplement them with a respiratory protection program. Under the final
construction standard, employers are given two options for compliance.
The first option specifies, in Table 1 of the final rule, the exposure
control methods and respiratory protection required for compliance when
performing the specified task or operating the specified machines.
Employers choosing this option must fully and properly implement the
control methods and respiratory protection on the table to be
considered to be in compliance with Table 1. The second option largely
follows the requirements in the general industry and maritime standard:
employers must conduct exposure monitoring and provide sufficient
controls to ensure that their workers are not exposed above the PEL.
    One regulatory alternative (Regulatory Alternative #8) involving
methods of compliance would be to eliminate Table 1 as a compliance
option in the construction sector. This was suggested by one commenter
(Document ID 1950), as a means of promoting innovation.
    As discussed in the Summary and Explanation in detail, OSHA
fashioned the final rule as a sensible compromise between providing
clear direction for employers, in a manner that reduces compliance
burdens, and allowing for flexibility and innovation when desired.
Table 1 is an option in the final rule that promotes both goals. While
OSHA assumes that most establishments will choose to follow Table 1, in
part to avoid the cost of monitoring, it is not a requirement.
Employers are free to follow the other option (paragraph (d) of the
standard) and conduct the required monitoring and devise their own
means of complying with the PEL if they choose. To eliminate Table 1,
therefore, would actually provide less flexibility and impose
additional costs upon employers. OSHA therefore did not quantify costs
or benefits for eliminating Table 1. Nonetheless, the Agency

seriously doubts that there would be any additional benefits under
Alternative #8, and concludes that removing the Table 1 option would
significantly increase exposure monitoring costs by taking away a
carefully crafted ``safe harbor'' provision from employers.
Regulatory Alternatives That Affect the Timing of the Standard
    The final rule will become effective 90 days following publication
of the final rule in the Federal Register. The provisions outlined in
the construction standard will become enforceable one year following
the effective date, except for those governing sample analysis (two
years). The provisions set forth in the general industry and maritime
standards will become enforceable two years following the effective
date, with the exception that the engineering and work practice control
requirements in the hydraulic fracturing industry will become
enforceable five years after the effective date.
    There are many theoretical options that OSHA could explore with
regard to compliance dates. These include: Requiring the fracking
industry to follow the same compliance schedule as all other general
industry and maritime employers; going back to the dates originally
proposed (one year for engineering controls, two years for
laboratories, six months for all other provisions); allowing more time
for all employers to comply with the final rule; or allowing less time
for all employers to come into compliance. These options are explored
in detail in the Summary and Explanation for DATES. As indicated in
that discussion, there are technical issues, and there may be
additional costs, associated with advancing the compliance dates ahead
of those laid out in the final rule; in all cases, pushing back the
compliance deadlines will also push back the onset of benefits
generated by the final rule. OSHA has not quantified the costs or
benefits of either advancing or delaying any of the compliance dates
because the timing of the effective dates has the same percentage
effect on both benefits and costs.

I. Final Regulatory Flexibility Analysis

    The Regulatory Flexibility Act, as amended in 1996, requires an
agency to prepare a Final Regulatory Flexibility Analysis (FRFA)
whenever it promulgates a final rule that is required to conform to the
notice-and-comment rulemaking requirements of section 553 of the
Administrative Procedure Act (APA) (see 5 U.S.C. 601-612). For OSHA
rulemakings, the FRFA analysis must contain:

    1. A statement of the need for, and objectives of, the rule;
    2. a statement of the significant issues raised by the public
comments in response to the initial regulatory flexibility analysis,
a statement of the assessment of the agency of such issues, and a
statement of any changes made in the proposed rule as a result of
such comments;
    3. the response of the agency to any comments filed by the Chief
Counsel for Advocacy of the Small Business Administration (SBA) in
response to the proposed rule, and a detailed statement of any
change made to the proposed rule in the final rule as a result of
the comments;
    4. a description of and an estimate of the number of small
entities to which the rule will apply or an explanation of why no
such estimate is available;
    5. a description of the projected reporting, recordkeeping and
other compliance requirements of the rule, including an estimate of
the classes of small entities which will be subject to the
requirement and the type of professional skills necessary for
preparation of the report or record; and
    6. a description of the steps the agency has taken to minimize
the significant economic impact on small entities consistent with
the stated objectives of applicable statutes, including a statement
of the factual, policy, and legal reasons for selecting the
alternative adopted in the final rule and why each one of the other
significant alternatives to the rule considered by the agency which
affect the impact on small entities was rejected; and for a covered
agency, as defined in section 609(d)(2), a description of the steps
the agency has taken to minimize any additional cost of credit for
small entities. 5 U.S.C. 604.

    The Regulatory Flexibility Act further states that the required
elements of the FRFA may be performed in conjunction with or as part of
any other agenda or analysis required by any other law if such other
analysis satisfies the provisions of the FRFA. 5 U.S.C. 605.
    In addition to these elements, OSHA also includes, in this section,
the recommendations from the Small Business Advocacy Review (SBAR)
Panel and OSHA's responses to those recommendations.
    While a full understanding of OSHA's analysis and conclusions with
respect to costs and economic impacts on small entities requires a
reading of the complete FEA and its supporting materials, this FRFA
summarizes the key aspects of OSHA's analysis as they affect small
entities.
The Need for and Objectives of the Rule
    Exposure to crystalline silica has been shown to increase the risk
of several serious diseases. Crystalline silica is the only known cause
of silicosis, which is a progressive respiratory disease in which
respirable crystalline silica particles cause an inflammatory reaction
in the lung, leading to lung damage and scarring, and, in some cases,
to complications resulting in disability and death. In addition, many
well-conducted investigations of exposed workers have shown that
exposure increases the risk of mortality from lung cancer, chronic
obstructive pulmonary disease (COPD), and renal disease. OSHA's
detailed analyses of the scientific literature and silica-related
health risks were presented in OSHA's Review of Health Effects
Literature and Preliminary QRA in the NPRM (Document ID 1711, pp. 7-
229), and are included in Section VI Significance of Risk in this
preamble.
    OSHA reviewed numerous studies and found that they all demonstrated
positive, statistically significant exposure-response relationships
between exposure to crystalline silica and lung cancer mortality (see
the Health Risk section in this preamble for more detail). In addition,
OSHA noted that in 2009 the International Agency for Research on Cancer
(IARC) reaffirmed its finding that respirable crystalline silica is a
human carcinogen, identifying in its analysis an overall positive
exposure-response relationship between cumulative exposure to
crystalline silica and lung cancer mortality (see Section VI,
Significance of Risk; Document ID 1711, pp. 269-292). Based on studies,
OSHA estimates that the lifetime lung cancer mortality excess risk
associated with 45 years of exposure to respirable crystalline silica
ranges from 11 to 54 deaths per 1,000 workers at the preceding general
industry PEL of 100 [micro]g/m\3\ respirable crystalline silica, with
that risk reduced to 5 to 23 deaths per 1,000 workers at the new PEL of
50 [micro]g/m\3\ respirable crystalline silica.
    OSHA has also quantitatively evaluated the mortality risk from non-
malignant respiratory disease, including silicosis and COPD. Risk
estimates for silicosis mortality are based on a study by Mannetje et
al. (2002b, Document ID 1089), as reanalyzed by ToxaChemica, Inc.
(2004, Document ID 0469), which pooled data from six worker cohort
studies to derive a quantitative relationship between silica exposure
and death rate for silicosis. For non-malignant respiratory disease
generally, risk estimates are based on an epidemiologic study of
diatomaceous earth workers, which included a quantitative exposure-
response analysis (Park et al., 2002, Document ID 0405). For 45 years
of exposure to the preceding general industry PEL, OSHA's estimates of
excess lifetime risk are 11 silicosis deaths per 1,000 workers for

the pooled analysis and 85 non-malignant respiratory disease deaths per
1,000 workers based on Park et al.'s (2002) estimates (Document ID
0405). At the new PEL, OSHA estimates silicosis and non-malignant
respiratory disease mortality at 7 and 44 deaths per 1,000,
respectively. As noted by Park et al. (2002) (Document ID 0405), it is
likely that silicosis as a cause of death is often misclassified as
emphysema or chronic bronchitis; thus, Mannetje et al.'s analysis of
deaths may tend to underestimate the true risk of silicosis mortality,
while Park et al.'s (2002) analysis would more fairly capture the total
respiratory mortality risk from all non-malignant causes, including
silicosis and COPD.
    OSHA also identified five studies that quantitatively described
relationships between exposure to respirable crystalline silica and
silicosis morbidity, as diagnosed from chest radiography. Based on the
results of these studies, OSHA estimates a cumulative risk for
silicosis morbidity of 60 to 773 cases per 1,000 workers for a 45-year
exposure to the preceding general industry PEL of 100 [micro]g/m\3\
respirable crystalline silica, and 20 to 170 cases per 1,000 workers
exposed at the new PEL of 50 [micro]g/m\3\ (see Section VI,
Significance of Risk, Table VI-1).
    OSHA's estimates of crystalline silica-related renal disease
mortality risk are derived from an analysis by Steenland et al. (2002,
Document ID 0448), in which data from three cohort studies were pooled
to derive a quantitative relationship between exposure to silica and
the relative risk of end-stage renal disease mortality. The cohorts
included workers in the U.S. gold mining, industrial sand, and granite
industries. OSHA's analysis for renal disease mortality shows estimated
lifetime excess risk of 39 deaths per 1,000 workers at the preceding
general industry PEL of 100 [micro]g/m\3\ respirable crystalline
silica, and 32 deaths per 1,000 workers exposed at the new PEL of 50
[micro]g/m\3\ (see Section VI, Significance of Risk, Table VI-1).
    The objective of the final rule is to reduce the numbers of
fatalities and illnesses occurring among employees exposed to
respirable crystalline silica in general industry, maritime, and
construction sectors. This objective will be achieved by requiring
employers to install engineering controls where appropriate and to
provide employees with the equipment, respirators, training, exposure
monitoring, medical surveillance, and other protective measures
necessary for them to perform their jobs safely. The legal basis for
the rule is the responsibility given to the U.S. Department of Labor
through the Occupational Safety and Health Act of 1970 (OSH Act). The
OSH Act provides that, in promulgating health standards dealing with
toxic materials or harmful physical agents, the Secretary ``shall set
the standard which most adequately assures, to the extent feasible, on
the basis of the best available evidence, that no employee will suffer
material impairment of health or functional capacity even if such
employee has regular exposure to the hazard dealt with by such standard
for the period of his working life.'' 29 U.S.C. 655(b)(5) (see Section
II, Pertinent Legal Authority for a more detailed discussion).
Summary of Significant Issues Raised by Comments on the Initial
Regulatory Flexibility Analysis (IRFA) and OSHA's Assessment of, and
Response to, Those Issues
    Small business representatives commented on all aspects of this
rule, and their comments and OSHA's responses are covered throughout
this preamble and the FEA. This section of the FRFA focuses only on
comments that directly concern this FRFA or the screening analysis that
precedes it.
    One commenter questioned the use of SBA definitions for small
businesses, arguing that some definitions include firms with 500
employees or more, which, according to the commenter, are too large to
constitute ``small'' businesses. The commenter commended OSHA for also
including an analysis of very small entities with fewer than 20
employees (Document ID 2351, Attachment 1, p. 8). OSHA determined that
both the analysis of the impacts on SBA-defined small entities and the
analysis of the impacts on very small entities (those with fewer than
twenty employees) are useful and important for examining small business
impacts.
    Two commenters were concerned that their industries had not been
covered in the IRFA. The American Railroad Association noted that small
railroads had not been covered (Document ID 2366, Attachment 1, p. 4).
The commenter is correct that OSHA did not examine small entities in
this sector in the IRFA. For the FEA, OSHA has added a discussion of
small entities in the railroad industry to Chapter VI, Economic
Impacts. The Sorptive Minerals Institute also stated that their
industry was not covered in the IRFA (Document ID 4230, Attachment 1,
p. 16). As discussed in Chapter IV, the sorptive mineral industry was
covered as part of a larger industry. In any case, OSHA has excluded
exposures that result from the processing of sorptive clays from the
scope of the final rule.
    Many commenters were concerned that OSHA had not used economic data
that included the effects of the recent ``great recession''. This issue
was addressed in the Chapter VI Introduction, but some commenters
specifically discussed this topic in reference to small entities
(Document ID 1822, Attachment 1, p. 1; 2187, Attachment 1, p. 2; 2322,
p. 13; 3433, p. 8; 4231, Attachment 1, pp. 15-17). Complete data of the
kind that OSHA needs for a thorough analysis of economic impacts were
not yet available at the time the PEA was developed. As discussed in
Chapter II, Industrial profile, the FEA, including this FRFA, uses
2012, the most recent year with complete data, as a base year and used
average profits from years including the recession and surrounding
years.
    Some commenters were concerned with OSHA's estimates of small
business profits. One commenter pointed out that OSHA had relied
entirely on C corporation data, even though many affected firms might
be S corporations, partnerships or sole proprietorships (Document ID
2296, Attachment 1, p. 23). This is true, but there are no published
data on S corporation, partnership, or sole proprietorship profits, and
thus C corporation data is the best available data. As another
commenter pointed out, reported profits of small business are generally
lower than the total returns earned by owners who also act as
executives for their firms. The same commenter explained that smaller
firms have a great deal of flexibility in deciding what portions of
entity gains are reported as profits, what portions are reported as
management salaries, and what portions are reported as management
bonuses (Document ID 2163, Attachment 1, p. 7). As a result, it is
possible that OSHA has underestimated small firm profits and thus
overestimated potential impacts on profits.
    Stuart Sessions argued that OSHA should have analyzed whether
smaller firms have higher or lower profits than larger firms (Document
ID 4231, Attachment 1, pp. 11-12). The limited data supplied by Mr.
Sessions, however, did not show that small firms either had larger or
smaller profits than bigger firms on an across-industry basis (Document
ID 4231, Attachment 1, p. 11). Mr. Sessions developed an economic model
that used a combination of multiple data sources to determine profit
rates of small firms (RMA and BizMiner). In Chapter III Industrial
Profile, Revenue and Profit,

OSHA discusses why the Agency's analysis does not use these alternate
data sources suggested by Mr. Sessions. Mr. Sessions, testifying on
behalf of the Construction Industry Safety Coalition, also testified
that the use of data aggregated to the four-digit NAICS code level in
OSHA's analysis shields small businesses from being captured properly
in the analysis, and that ``the analysis at the six-digit level would
show substantial impacts for masonry contractors who are small business
. . ., which the analysis currently doesn't show'' (Document ID 3580,
Tr. 1402). Mr. Sessions further claimed that, even though OSHA analyzed
the costs to employers with 20 or fewer employees, the analysis still
``hid'' a lot of small businesses (Document ID 3580, Tr. 1402). The use
of Internal Revenue Service's Corporation Source Book profit data at a
four-digit NAICS code level is explained in Chapter III along with a
discussion explaining why alternative data sources suggested by Mr.
Sessions are not applied in the FEA.
    At least one commenter argued that OSHA might have inaccurately
estimated small firm revenues as a result of OSHA's method of
projecting revenues for years when Census data are not available
(Document ID 4231, Attachment 1, pp. 15-17). This argument is now moot,
as OSHA is using data from the 2012 Economic Census, and is not using
projected revenues in this analysis.
    Some commenters argued that OSHA had not adequately accounted for
diseconomies of scale in small firms (Document ID 4231, Attachment 1,
pp. 2-5; 2307, Attachment 10, p. 25; 2322, Attachment 1, pp. 15-16).
During his testimony, Stuart Sessions testified that it was his ``guess
. . . that small businesses are substantially more likely to be
noncompliant currently than large businesses,'' and requested that OSHA
conduct additional analysis to ``handle the differential compliance
rates between small and large business'' (Document ID 3580, Tr. 1399).
As discussed in Chapter V, OSHA has changed its approach to estimating
costs of small firms to account for diseconomies of scale in small
firms. However, there is no evidence, other than Mr. Sessions's
``guess,'' that small firms are less compliant than large firms.
    Janet Kaboth, testifying on behalf of a small company in the brick
manufacturing industry, stated that small businesses are more impacted
by the rule because they have more difficulty accessing capital to
upgrade engineering controls:

    [Engineering controls] must be purchased and paid for in the
first year of compliance. . . . It is extremely unlikely that a
small entity such as Whitacre Greer would be able to obtain a bank
loan . . . for something that does not reduce costs or increase
revenue and additionally adds cost (Document ID 3589, Tr. 3397-
3399).

    As discussed in Chapter VI, Economic Impacts, small firms will
typically be able to pay for the first year costs of engineering
controls from a single year's profits. Thus, there is no need to
account for possible difficulties in obtaining credit.
    A different commenter requested that OSHA provide additional
guidance in Table 1 of the construction standard as a way to mitigate
the impact on small businesses (Document ID 2322, p. 6). OSHA has done
so, and agrees that it will likely ease compliance for small
construction businesses because it provides them with task-specific
guidance that will allow them to avoid more complicated exposure
monitoring processes.
    Many companies, associations, and private individuals submitted
comments requesting a new SBAR Panel based a number of changes that
have occurred since the SBAR Panel for this rule was held in 2003. The
first and most common concern was that the economic data and
information gathered during the Panel have become outdated and do not
represent the dramatic changes in economic conditions that have
resulted from the boom and bust economic cycle that occurred in the
years following 2003 (Document ID 2224, p. 2; 2004, p. 1; 3580, Tr.
1274-1276; 1779, p. 2; 1767, p. 2; 1783, p. 1; 2140, p. 1; 3495, p. 2;
1798, p. 6; 1811, pp. 1-2; 2023, p. 1; 2222, p. 1; 2224, p. 2; 2230, p.
1; 2248, Attachment 1, p. 5; 2294, p. 2; 2300, p. 2; 2305, p. 13; 2279,
p. 11; 2289, p. 9; 2391, p. 2; 3275, pp. 2-3; 2075, p. 4; 2083, p. 1;
2114, Attachment 1, p. 2; 2150, p. 2; 2170, Attachment 1, p. 1; 2210,
Attachment 1, pp. 1-2; 4194, p. 5; 4210, Attachment 1, p. 2; 4217,
Attachment 1, p. 7). Some commenters claimed that their industries have
not recovered from the recession of 2008 and feel that their economic
circumstances as small entities have changed as a result (Document ID
1779, p. 2; 1767, p. 2; 1783, p. 1; 2140, p. 1; 3495, p. 2).
    OSHA conducted the SBAR Panel early in the rulemaking process in
order to address small business concerns during the development of the
proposed rule. The Agency used information gathered during the SBAR
Panel to make significant changes to the proposed rule itself, as well
as to the cost, impact, and other analyses contained in the proposal.
OSHA's proposal contained six pages of tables that described every
recommendation from the SBAR Panel, along with the Agency's responses.
    OSHA's extensive rulemaking process included small business
feedback not only from the original SBREFA review in 2003, but also
from the subsequent written comment period in 2013 and 2014, as well as
from the public hearings held in 2014. The rulemaking record shows the
major issues that arose with respect to technological feasibility,
costs, economic feasibility, and possible alternatives to the proposed
rule represented largely the same issues addressed by small entity
representatives (SERs) in 2003. To the extent there may be new issues
that have arisen since the SBAR Panel made its recommendations, OSHA is
confident that commenters, including small entities and the Small
Business Administration's Office of Advocacy, were able to raise those
issues and express whatever concerns they had about them later in the
rulemaking process. OSHA has addressed comments regarding recent and
current economic conditions under which small businesses are operating
by considering this information in developing the final rule and
supporting analyses.
    A second concern raised by commenters who were advocating for OSHA
to hold a new SBAR Panel, related to the changes in technology and work
practices that have taken place over the last ten years. For example,
one commenter claimed that the comments of the SERs were not reflective
of the greater use of tools with dust collection capability, and other
devices currently being used that release water at the point of
cutting, to control silica dust (Document ID 2210, Attachment 1, p. 1).
However, the commenters who wanted OSHA to account for improved
technology and work practices did not generally provide information to
supplement or update the information OSHA received from the SERs,
despite opportunities to do so.
    While there has been progress in the development and adoption of
technologies that reduce silica exposures, the record (including
comments from the commenters calling for a new Panel) brought out few,
if any, fundamentally new technologies for reducing silica exposure. In
any event, the advancement of technologies that would improve silica
control or reduce the cost impact of the final rule would not
necessitate a new SBAR panel.
    There were also a number of construction firms that expressed
disappointment at not being able to

comment on Table 1, as presented in the proposed rule, prior to the
proposed rule being issued (Document ID 2187, p. 22; 4217, Attachment
1, p. 7; 3580, Tr. 1274-1276). It is typical for OSHA to modify a rule
as a result of the SBREFA process. The SBREFA process is a one-time
requirement, not a requirement to conduct a new Panel every time a rule
is altered in response to SBAR Panel recommendations. The commenters,
who did have the opportunity to comment on Table 1 once it was
proposed, did not present any compelling argument regarding how the
timing of their opportunity to comment impacted their ability to
communicate their recommendations about Table 1 to OSHA. The Agency
notes that it has made a number of significant changes to Table 1 since
the proposal, most in response to post-proposal comments, so it is
clear that commenters had ample opportunities to recommend improvements
to Table 1.
    No SERs from the hydraulic fracturing industry were included in the
2003 SBAR panel. OSHA did not determine that this industry would be
affected by this rule until the preparation of the NPRM and the PEA. As
a result, OSHA has received comments from associations and businesses
requesting a new SBAR Panel that would allow a more detailed analysis
of the potential impacts on small entities in this industry. Commenters
pointed out that the unique economic circumstances of the hydraulic
fracturing industry were not presented for public comment or analysis
on regulatory alternatives and small business impacts during the
Agency's 2003 SBAR Panel (Document ID 2301, Attachment 1, p. 63; 3589,
pp. 15-16; 2288, p. 5).
    OSHA is not required to assure that every industry affected by a
rule is represented on the Panel by a SER. The hydraulic fracturing
industry had extensive opportunities to comment throughout this
rulemaking process. In fact, a number of commenters, including several
trade associations, submitted comments and testified at the hearing,
providing analysis of the hydraulic fracturing industry for the record.
OSHA sees no indication that the record would be better developed by
convening a different SBAR panel with a SER from the hydraulic
fracturing industry. OSHA has, however, extended the compliance
deadline for these firms to install the required engineering controls
required by this final rule to five years; three more years than for
establishments in general industry and four more years than for
construction firms.
Response to Comments by the Chief Counsel for Advocacy of the Small
Business Administration and OSHA's Response to Those Comments
    The Chief Counsel for Advocacy of the Small Business Administration
(``Advocacy'') provided OSHA with comments on this rule on February 11,
2014 (Document ID 2349). Advocacy provided comment on OSHA's risk
assessment and benefits analysis; technological feasibility analysis;
cost analysis; current economic conditions; preferred alternatives; and
procedural issues.
Risk Assessment and Benefits Issues
    With respect to the risk assessment, Advocacy was concerned that
OSHA was attributing benefits to reducing the PEL to 50 [mu]g/m\3\ that
perhaps would better be attributed to eliminating exposures above the
existing PEL of 100 [mu]g/m\3\ (Document ID 2349, pp. 3-4). OSHA does
not think this is the case. As discussed in the section on significant
risk, OSHA did not assess the risk of silica exposure by attributing
existing known cases of silicosis or any other disease to various PELs.
Rather, OSHA examined risk assessment studies that assessed the long
term consequences of various levels of exposure to silica. Such studies
focus on estimating the morbidity and mortality that result from
changing lifetime exposure levels from the preceding PELs of 100 [mu]g/
m\3\ in general industry and 250 [mu]g/m\3\ in construction to the new
PEL of 50 [mu]g/m\3\.
    Advocacy also expressed concerns about the accuracy of older
exposure data (Document ID 2349, p. 4). OSHA's exposure profile, used
for examining feasibility and benefits, now shows only exposures
measured after 1990 and includes data from OSHA's OIS system for 2011
to 2014.
    Advocacy was also concerned that OSHA might not have adequately
accounted for varying risk levels associated with different types of
silica (Document ID 2349, p. 4). OSHA carefully considered this issue
in the risk assessment section and found there were insufficient data
to demonstrate significant risk for silica exposures that result from
processing sorptive clays. As a result, OSHA excluded this processing
activity from the scope of the final standard. OSHA found that, while
the risk from other forms of silica may vary, there is evidence of
significant risk for all of the other forms of respirable crystalline
silica.
    Advocacy also reported that small business representatives were
concerned that ``OSHA's assumption that silica exposure occurs over a
working life of eight hours per day for 45 years does not reflect
modern working conditions'' (Document ID 2349, p. 4). OSHA is required
by the OSH Act to consider the risk of a hazard over a worker's entire
working life (see 29 U.S.C. 655(b)(5)). In Chapter VII of the FEA, OSHA
also examined other possible average tenure assumptions.
    Advocacy also reported that small business representatives ``noted
the uncertainty of assessing silica-related risk because of confounding
factors, such as smoking or exposure to other chemicals, and the long
latency period for silica-related illness to appear'' (Document ID
2349, p. 4). OSHA notes in Section VI, Significance of Risk, in this
preamble that study after study finds that incidence of the diseases
caused by exposure to silica rises with increasing exposures to silica.
In order to see this type of result, and for those results to be driven
by smoking as a confounding factor, it would be necessary not just that
the silica-using population smoke more than the comparable non-silica
using population, but also that smoking rates rise as silica exposures
increase. This seems very unlikely and there is no evidence in the
record that this is the case.
Technological Feasibility Issues
    Advocacy noted that small business representatives had raised many
concerns about whether the controls OSHA indicated as appropriate to
achieve the PEL were feasible in all circumstances and could, in fact,
allow an employer to fully achieve the PEL (Document ID 2349, p. 4).
OSHA has thoroughly examined all comments on this kind of issue across
all affected industries in Chapter IV of the FEA, and OSHA notes that
employers may raise infeasibility as a defense in enforcement actions.
Advocacy also noted that small business representatives were concerned
about whether available methods of measuring exposure were sufficiently
accurate to correctly measure the action level and PEL (Document ID
2349, p. 4). OSHA has explained in Chapter IV of the FEA why existing
equipment is sufficiently accurate to correctly measure airborne
respirable silica at the levels established by the new PEL and action
level.
    Advocacy said that one small business representative ``noted that
increasing the volume of air needed for additional ventilation could
result in a violation of a facility's air permit'' (Document ID 2349,
p. 5). While the Agency does not believe that most small employers
exhaust large enough volumes of air that the additional

ventilation required by this final standard will result in needing to
alter air permits, OSHA does acknowledge that this may be an issue for
some employers. In order to reduce the burden, should this be the case,
OSHA has given general industry employers an additional year to meet
the PEL, and has added costs for firms subject to air permitting
requirements to alter their permits to more fully assess the economic
feasibility of this rule.
    Advocacy also said that one small business representative ``noted
that creating regulated areas is not feasible in many open-design
facilities'' (Document ID 2349, p. 5). Regulated area requirements have
been a part of OSHA health standards for many years and employers have
consistently found ways to make them work. The Agency does not expect
that establishing a regulated area for silica would be any more
difficult than establishing such an area for any of the other
substances for which OSHA has regulated area requirements. In addition,
OSHA does not have a regulated area requirement in construction where
workplaces (such as in road building or repair) are more mobile.
Cost Issues
    Advocacy stated that small business representatives generally felt
that OSHA underestimated costs, and were particularly concerned about
OSHA's ``cost per exposed worker'' approach and OSHA's estimates of the
number of workers whose exposures are controlled per engineering
control (Document ID 2349, p. 5). The specific methodological issues
that Advocacy mentions are issues for OSHA's general industry and
maritime cost estimates, but not for construction cost estimates
because the cost estimation methodologies for the construction sector
are quite different and do not use the ``cost per exposed worker''
approach. OSHA has provided detailed responses to comments on costs in
Chapter V. In general industry and maritime, OSHA continues to use the
cost per exposed worker approach and defends this approach in Chapter
V. OSHA has lowered its estimate of the number of workers whose
exposures are reduced per engineering control in response to comments
from small business representatives and others.
    Advocacy also noted that small business representatives objected to
OSHA focusing on the incremental cost of moving from the preceding PELs
to the new PEL. Advocacy reported that small business representatives
believed OSHA should have included the costs of reaching the preceding
PEL in its analysis (Document ID 2349, p. 5). Contrary to Advocacy's
suggestion, OSHA did not conduct the analysis this way because it would
require an assumption that employers are not complying with OSHA's
existing requirements to meet the preceding PEL, but would now choose
to comply with a more stringent requirement. OSHA's exposure profiles
do indicate that many employers are failing to meet the preceding PELs,
but the question that the Agency has to address with this analysis for
this rulemaking is whether OSHA should require employers to meet a
lower PEL than the preceding PEL. The costs of meeting the preceding
PEL are not relevant to that decision.
Issues Concerning Current Economic Conditions
    Advocacy reported that ``small business representatives stated that
OSHA was using older economic data that does not reflect current
economic conditions, and [thus] that OSHA's cost pass-through
assumptions are unrealistic'' (Document ID 2349, p. 5). For the FEA,
OSHA is using 2012 as the base year for economic data and includes data
from the recent recession in analyzing average industry profits and
historical changes in profits and prices. OSHA has updated its findings
on the ability of firms to pass costs on to buyers in light of the
updated data, resolving Advocacy's concern on this issue.
Regulatory Alternatives
    Advocacy commended OSHA for following the advice of small business
representatives and adopting the Table 1 approach for the construction
sector, but urged OSHA to make the table clearer, more workable, and
more specific, and to relieve employers of any remaining duty to
conduct exposure monitoring when engaged in Table 1 tasks (Document ID
2349, p. 6). OSHA has revised Table 1, as Advocacy and small business
representatives suggested, to provide employers with a clear
alternative to exposure monitoring and to provide greater clarity and
specificity in the descriptions of controls.
    Advocacy also urged OSHA to consider the option of leaving the PEL
unchanged and instead improving enforcement, noting that this was the
option most favored by small business representatives (Document ID
2349, p. 3). However, the OSH Act commands OSHA to protect workers from
harmful substances by setting

. . . the standard which most adequately assures, to the extent
feasible, on the basis of the best available evidence, that no
employee will suffer material impairment of health or functional
capacity even if such employee has regular exposure to the hazard
dealt with by such standard for the period of his working life.'' 29
U.S.C. 655(b)(5).

The record does not indicate that workers are currently protected in
accordance with the Act. There are currently two entirely different
PELs, 100 [mu]g/m\3\ in general industry and 250 [mu]g/m\3\ in
construction. The record does not suggest either that employers in
construction cannot feasibly reach a lower PEL or that there is no
significant risk below 250 [mu]g/m\3\. The record shows that most
employers in construction currently reach a PEL of 50 [mu]g/m\3\ most
of the time (see Chapter IV) and that it is economically feasible to do
so (see Chapter VI).
    OSHA did consider the option of lowering the construction PEL to
100 [mu]g/m\3\ and leaving the general industry PEL unchanged. However,
this action would not be in accordance with the OSH Act given that
there is still significant risk at a PEL of 100 [mu]g/m\3\ and that a
lower PEL is both technologically and economically feasible. As shown
in OSHA's risk assessment, there is still significant risk of material
impairment of health at levels all the way down to a lower PEL of 25
[mu]g/m\3\, but OSHA found compliance with the lower PEL of 25 [mu]g/
m\3\ to be technologically infeasible for all industries.
    Finally, Advocacy urged OSHA to consider the option of abandoning
the hierarchy of controls, which is OSHA's longstanding policy of
preferring engineering controls and administrative controls over
personal protective equipment such as respirators (Document ID 2349,
pp. 4-5). This issue is addressed in the summary and explanation
section discussion of the methods of compliance provision. It should
also be noted that OSHA defines technological feasibility in terms of
what can be accomplished with engineering controls, not in terms of
what can be accomplished with respirators.
Issues With Respect to Small Business Participation
    Advocacy also expressed concern that small businesses did not have
adequate opportunity for participation in the rulemaking process and
that the SBAR panel was held over ten years before the proposed rule
was issued (Document ID 2349, p. 7). OSHA responded to these concerns
in section two of this FRFA.

A Description and Estimate of the Number of Small Entities To Which the
Rule Will Apply
    OSHA has analyzed the impacts associated with this final rule,
including the type and number of small entities to which the standard
will apply. In order to determine the number of small entities
potentially affected by this rulemaking, OSHA used the definitions of
small entities developed by the Small Business Administration (SBA) for
each industry.
    OSHA estimates that approximately 646,000 small business or
government entities would be affected by the silica standard. Within
these small entities, roughly 1.4 million workers are exposed to
crystalline silica and would be protected by this final standard. A
breakdown, by industry, of the number of affected small entities is
provided in Table III-6 in Chapter III of the FEA.
    OSHA estimates that approximately 579,000 very small entities would
be affected by the silica standard. Within these very small entities,
roughly 785,000 workers are exposed to crystalline silica and would be
protected by the standard. A breakdown, by industry, of the number of
affected very small entities is provided in Table III-7 in Chapter III
of the FEA.
A Description of the Projected Reporting, Recordkeeping, and Other
Compliance Requirements of the Rule
    Tables VII-36 and VII-37 show the average costs of the silica
standard and the costs of compliance as a percentage of profits and
revenues by NAICS code for, respectively, small entities (classified as
small by SBA) and very small entities (those with fewer than 20
employees). The costs for SBA defined small entities ranges from a low
of $295 per entity for entities in NAICS 238200 Building Equipment
Contractors, to a high of about $161,651 for NAICS 213112 Support
Activities for Oil and Gas Operations.
    The cost for very small entities ranges from a low of $223 for
entities in NAICS 238200 Building Equipment Contractors, to a high of
about $119,072 for entities in NAICS 213112 Support Activities for Oil
and Gas Operations.
    Tables VII-38a and VII-38b show the unit costs which form the basis
for OSHA's cost estimates for the average small entity and very small
entity.
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Description of the Steps OSHA Has Taken To Minimize the Significant
Economic Impact on Small Entities Consistent With the Stated Objectives
of Applicable Statutes and Statement of the Reasons for Selecting the
Alternative Adopted in the Final Rule
    OSHA has made a number of changes in the final silica rule that
will serve to minimize significant impacts on small entities consistent
with the objectives of the OSH Act.
    First, OSHA has made two changes to the scope of the rule that will
minimize impacts for small business. OSHA has eliminated from the scope
of the rule exposures that result from the processing of sorptive
clays. OSHA's analysis did not determine whether any or all of the
processers of sorptive minerals are small businesses, but to the extent
they are, this change will reduce impacts on such entities. OSHA has
also rewritten the scope of the rule with respect to the coverage of
employers whose employees are exposed to silica at levels below the
action level. The final rule does not apply to employers in general
industry and maritime where the employer has objective data
demonstrating that employee exposure to respirable crystalline silica
will remain below 25 [mu]g/m\3\ as an 8-hour time-weighted average
under any foreseeable conditions, and does not apply in construction
where employee exposure will remain below 25 [mu]g/m\3\ as an 8-hour
time-weighted average under any foreseeable conditions (see Scope in
Section XV, Summary and Explanation of the Standards). OSHA expects
that these changes may remove all compliance duties for some small
businesses, possibly including carpenters, plumbers, and electricians,
whose employees' only exposures to respirable crystalline silica is in
small amounts for short-duration tasks that are performed infrequently.
    OSHA also revised Table 1 for the construction industry in ways
that will minimize impacts on small businesses. OSHA requested comment
on the approach for construction in the NPRM. After carefully reviewing
the comments received on this issue, the Agency significantly revised
the structure of the construction rule to focus on the tasks known to
generate high exposures to respirable crystalline silica and to expand
Table 1 to cover almost all of them (tunnel boring and abrasive
blasting are the exceptions). Under this final rule, where employers
fully and properly implement the specified engineering controls, work
practices, and respiratory protection for each employee engaged in a
task identified on Table 1, the employer is not also required to
conduct exposure assessments to determine compliance with the PEL.
Specifying the kinds of dust controls for construction tasks that are
expected to reduce exposures to the 50 [micro]g/m\3\ target, as an
option in lieu of a performance-oriented approach involving a PEL and
regular exposure assessment, will make compliance easier for
construction employers. Some commenters indicated that this specific
guidance is particularly beneficial to small businesses that may not
have as many resources to develop their own compliance plans (e.g.,
Document ID 2322-A1, p. 16). The Agency also revised the notes and
specifications on Table 1 to clarify what is required for employers to
fully and properly implement the specified engineering controls, work
practices, and respiratory protection for tasks on Table 1 (see
Specified Exposure Control Methods in Section XV, Summary and
Explanation of the Standards).
    After carefully reviewing the comments received on respiratory
protection requirements for the construction standard and the exposure
data in the record (described in Chapter IV of the FEA), OSHA
identified those situations where respiratory protection is necessary
and made significant revisions to the respiratory protection
requirements specified on Table 1 based on those findings. The result
is that respiratory protection is not required for most of the tasks
covered by Table 1 (see Specified Exposure Control Methods in Section
XV, Summary and Explanation of the Standards).
    For this final rule, the Agency has significantly revised the
requirements for initial exposure assessment and periodic exposure
assessment in order to provide employers with greater flexibility. The
standard allows the employer to use either the performance option or
the scheduled monitoring option for initial and periodic exposure
assessments. OSHA also clarified that the performance option provides
employers with flexibility in the methods used to assess employee
exposures, and provided examples of how employers can accurately
characterize employee exposures using the performance option (see
Exposure Assessment discussion in Section XV, Summary and Explanation
of the Standards).
    At the suggestion of many commenters, OSHA has eliminated regulated
area/access control plan requirements in construction. Employers in
construction now have more flexibility in determining the best way to
control exposures through a written exposure control plan.
    In the final rule, OSHA has agreed with many commenters to
eliminate the requirements for protective clothing, and thus has
reduced costs to small businesses.
    OSHA requested comment on the use of wet methods as a substitute
for dry sweeping in the NPRM. After carefully reviewing the comments
received on this issue, the Agency revised the provision to prohibit
dry sweeping only where such activity could contribute to employee
exposure to respirable crystalline silica. Moreover, the standard
contains an exception to the prohibition on dry sweeping in such
circumstances if wet sweeping, HEPA-filtered vacuuming, or other
methods that minimize the likelihood of exposure are not feasible (see
Housekeeping in Section XV, Summary and Explanation of the Standards).
    In the NPRM, OSHA requested comment on the prohibition of employee
rotation to achieve compliance when exposure levels exceed the PEL.
After carefully reviewing the comments received on this issue, OSHA
removed the prohibition on employee rotation from the rule (see Methods
of Compliance in Section XV, Summary and Explanation of the Standards).
    OSHA examined the issue of a 30-day exemption in the NPRM. After
carefully reviewing the comments received on this issue, the Agency
decided not to include a 30-day exemption from the requirement to
implement engineering and work practice controls. However, OSHA
clarified that where engineering controls are not feasible, such as for
certain maintenance and repair activities, the use of respirators is
permitted (see Methods of Compliance and Respiratory Protection in
Section XV, Summary and Explanation of the Standards).
    OSHA adopted these alternatives to reduce costs and regulatory
burdens consistent with the requirements of the OSH Act and court
interpretations of the Act. For health standards issued under section
6(b)(5) of the OSH Act, OSHA is required to promulgate a standard that
reduces significant risk to the extent that it is technologically and
economically feasible to do so (see Section II, Pertinent Legal
Authority, for a full discussion of OSHA legal requirements).
    OSHA has conducted an extensive review of the literature on adverse
health effects associated with exposure to respirable crystalline
silica. The Agency has also developed estimates of the risk of silica-
related diseases

assuming exposure over a working lifetime at the proposed PEL and
action level, as well as at OSHA's preceding PELs. These analyses are
summarized in this preamble in Section V, Health Effects and
Quantitative Risk Analysis. The available evidence indicates that
employees exposed to respirable crystalline silica well below the
preceding PELs are still at increased risk of lung cancer mortality and
silicosis mortality and morbidity. Occupational exposures to respirable
crystalline silica also may result in the development of kidney and
autoimmune diseases and in death from other nonmalignant respiratory
diseases, including chronic obstructive pulmonary disease (COPD).
    As discussed in Section VI, Significance of Risk, in this preamble,
OSHA determined that worker exposure to respirable crystalline silica
constitutes a significant risk and that the final standard will
substantially reduce this risk. Further, there is significant risk well
below the new PEL of 50 [mu]g/m\3\, but OSHA has determined that
achieving a PEL of 25 [mu]g/m\3\ is not technologically feasible.
    Section 6(b) of the OSH Act requires OSHA to determine that its
standards are technologically and economically feasible. OSHA's
examination of the technological and economic feasibility of the final
rule is presented in the FEA and FRFA. OSHA has concluded that the new
PEL of 50 [mu]g/m\3\ is technologically feasible for all affected
sectors in general industry and maritime and that Table 1 is
technologically feasible for construction.
    For those few operations where the new PEL is not technologically
feasible, even when workers use recommended engineering and work
practice controls, employers can supplement controls with respirators
to achieve exposure levels at or below the new PEL.
    OSHA developed quantitative estimates of the compliance costs of
the final rule for each of the affected industry sectors in Chapter V
of the FEA. The estimated compliance costs were compared with industry
revenues and profits to provide a screening analysis of the economic
feasibility of complying with the revised standard and an evaluation of
the potential economic impacts in Chapter VI of the FEA. Industries
with unusually high costs as a percentage of revenues or profits were
further analyzed for possible economic feasibility issues. After
performing these analyses, OSHA has concluded that compliance with the
requirements of the final rule will be economically feasible in every
affected industry sector.
    OSHA has also provided analyses of the costs and benefits of
alternative PELs, though it should be pointed out these are for
informational purposes only. Benefit cost analysis cannot be used as a
decision criteria for OSHA health standards under the OSH Act. OSHA has
examined two regulatory alternatives (named Regulatory Alternatives #1
and #2) that would have modified the PEL for the final rule. Under
Regulatory Alternative #1, the PEL would have been 100 [mu]g/m\3\ for
all affected industry sectors, and the action level would have been 50
[mu]g/m\3\ (thereby keeping the action level at one-half of the PEL).
For the construction sector under Regulatory Alternative #1, Table 1
requirements for respirator use would have been eliminated for all
workers performing Table 1 tasks. Under this alternative, only abrasive
blasters and underground construction workers would have been required
to wear respiratory protection, and only workers wearing respirators in
these operations would have been subject to the medical surveillance
provision. Under Regulatory Alternative #2, the PEL would have been 25
[mu]g/m\3\ for all affected industry sectors, while the action level
would have remained at 25 [mu]g/m\3\ (because of difficulties in
accurately measuring exposure levels below 25 [mu]g/m\3\). For the
construction sector under Regulatory Alternative #2, Table 1
requirements would have been modified to include respiratory protection
for all workers covered under Table 1, and all these covered workers
would have been subject to the medical surveillance provision.
    Table VII-39 presents, for informational purposes, the estimated
costs, benefits, and net benefits of the final rule under Regulatory
Alternatives #1 and #2, using alternative discount rates of 3 and 7
percent. The tables also present the incremental costs, the incremental
benefits, and the incremental net benefits of going from a PEL of 100
[mu]g/m\3\ to the new PEL of 50 [mu]g/m\3\ and then of going from the
new PEL of 50 [mu]g/m\3\ to a PEL of 25 [mu]g/m\3\ for general industry
and maritime, as well as the effects in construction of the
corresponding changes to Table 1 under Regulatory Alternatives #1 and
#2. Table VII-39 breaks out costs by provision and benefits by type of
disease and by morbidity/mortality.
    Because OSHA determined that a PEL of 25 [mu]g/m\3\ would not be
feasible (that is, engineering and work practices would not be
sufficient to reduce and maintain silica exposures to a PEL of 25
[mu]g/m\3\ or below in most operations most of the time in the affected
industry sectors in general industry and maritime), the Agency did not
attempt to identify engineering controls or their costs for this
alternative PEL. Instead, for purposes of estimating the costs of going
from a PEL of 50 [mu]g/m\3\ to a PEL of 25 [mu]g/m\3\, OSHA assumed
that all workers exposed between 50 [mu]g/m\3\ and 25 [mu]g/m\3\ would
have to wear respirators to achieve compliance with a PEL of 25 [mu]g/
m\3\. OSHA then estimated the associated additional costs for
respirators, exposure assessments, medical surveillance, and regulated
areas (the latter three for ancillary requirements specified in the
final rule). For the construction sector under Regulatory Alternative
#2, as previously indicated, Table 1 requirements would be modified to
include respiratory protection for all covered workers, and all covered
workers would be subject to the medical surveillance provision.
    As shown in Table VII-39, going from the final rule to Regulatory
Alternative #2 would prevent, annually, an additional 295 silica-
related fatalities and an additional 122 cases of silicosis. These
estimates support OSHA's finding that there is significant risk
remaining at the new PEL of 50 [mu]g/m\3\. However, the Agency has
determined that it cannot select Regulatory Alternative #2 because a
PEL of 25 [mu]g/m\3\ is not technologically feasible and this
alternative would require extensive use of respirators for those using
Table 1 under the construction standard (see the Technological
Feasibility Summary in this preamble for a further discussion of the
feasibility of a PEL of 25 [mu]g/m\3\).

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Recommendations From the SBAR Panel and OSHA's Responses
    Table VII-40 lists all of the SBAR Panel recommendations and OSHA's
responses to these recommendations.
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