b. Revision to the introductory text of 40 CFR 260.31(c) to require that all criteria are met. When the partial reclamation variance provision was originally promulgated in 1985, EPA stated that the Regional Administrator or authorized State Director could weigh the decision criteria "as she sees fit, and may rely on any or all of them to reach a decision." Based on experience with the variance provision, EPA is proposing to change the introductory text of 40 CFR 260.31(c) to require that all criteria must be satisfied before a variance is granted. EPA is proposing this change for several reasons. First, criterion 1 emphasizes that the material must have been substantially partially reclaimed to be eligible for a variance. (This is discussed further in the next section below.) Second, we believe that each of the proposed revised criteria numbers 2, 3, 4, and 5 appropriately reflects a fundamental and essential characteristic of a commodity-like material. Therefore, all criteria must be met for the material to be determined to be commodity-like. In addition, clarifying that all of the criteria must be met will result in more consistent application of the variance by different decision makers.
	EPA requests comment on whether (1) the revised introductory text is more clear, (2) the revised criteria appropriately reflect the fundamental characteristics of a commodity-like material; and (3) requiring that all criteria must be met to grant a variance will foster appropriate and consistent variance decisions.
c. Revisions to all criteria of 40 CFR 260.31(c). EPA is proposing revisions to all of the criteria in 40 CFR 260.31(c). First, all of the criteria have been revised to begin with the word "whether" to make it clear that the regulatory authority must make a yes or no determination as to whether the material meets each criterion. In addition, all of the criteria have been revised to be clearer and to better reflect the fundamental characteristics of a commodity-like material. The proposed changes to each criterion are discussed below.
1. The degree of processing the material has undergone and the degree of further processing that is required.
	EPA is proposing to revise this criterion to read as follows:
(1) Whether the degree of partial reclamation the material has undergone is substantial.
	This criterion examines the degree of reclamation the material has undergone to become commodity-like. The more substantial the partial reclamation step is, the more likely it is that the material generated by the partial reclamation step is commodity-like.
	First, EPA is proposing to replace the general term "processing" with the more specific and accurate term "partial reclamation." Second, EPA is proposing to remove from the criterion the concept that the initial partial reclamation step that makes a material commodity-like should be compared to the further reclamation that occurs after the material has become commodity-like. Experience with the variance has clarified that the relevant question is whether the partial reclamation that has been completed is substantial and that the material produced is not the original hazardous waste. If the material has been substantially partially reclaimed, it then can be evaluated to determine whether it is commodity-like using the remaining criteria. The degree of reclamation that occurs in the final reclamation step is not indicative of whether the partially-reclaimed material is commodity-like. This criterion would be satisfied when the partial reclamation is substantial and has produced a material that is no longer the original hazardous waste.
	EPA requests comment on whether the proposed revisions to this criterion clarify when a variance is applicable. EPA also requests comment on the appropriateness of removing the requirement to compare the degree of partial reclamation to the degree of final reclamation.
2. The value of the material after it has been reclaimed.
	EPA is proposing to revise this criterion to read as follows:
(2) Whether the partially-reclaimed material has sufficient economic value that it will be purchased for final reclamation.
	This criterion examines the first of four fundamental characteristics that indicates that a partially-reclaimed material is commodity-like, the value of the material produced by the partial reclamation step.
	EPA is proposing to add the word "partially-" before the word "reclaimed" to clarify that the criterion applies to the partially-reclaimed material, not the fully-reclaimed material produced later in the process. EPA is also proposing to revise this criterion to reflect the fundamental characteristic that a commodity-like material has positive economic value. A partially-reclaimed material that is commodity-like will be purchased by those who use it in manufacturing and production operations. EPA notes that the value of a material produced at a later stage of reclamation cannot be used to justify a variance for the partially-reclaimed material produced earlier in the process. In other words, the criterion must be applied to the material as it is at the specific point in the reclamation process where application of the variance is requested.
	Evidence to support this criterion may include sales information; demand for the material; and business contracts (e.g., contracts specifying quantities of material sold, details of the transaction, and the effective price paid for the partially reclaimed material by purchasers (i.e., after subtracting transportation costs and any other goods or services rendered in exchange for the material purchased)).
	EPA requests comment on whether the proposed revisions clarify the criterion and appropriately describe the fundamental economic value characteristic of a commodity-like material.
3. The degree to which the reclaimed material is like an analogous raw material.
	EPA is proposing to revise this criterion to read as follows:
(3) Whether the partially-reclaimed material is a viable substitute for a product or intermediate, produced from virgin or raw materials, which feeds subsequent production steps.
	This criterion reflects the second of four fundamental characteristics of a commodity-like material that must go through further reclamation before it becomes a final commercial product. In short, the material must be sufficiently analogous to a product or intermediate used in a manufacturing process to substitute for that product or intermediate.
	First, as with other criteria, EPA is proposing to add the word "partially-" before the word "reclaimed" to clarify that the criterion applies to the partially-reclaimed material, not the fully-reclaimed material produced later in the process. Second, EPA is proposing to replace the phrase "is like an analogous raw material" with the phrase "is a viable substitute for a product or intermediate, produced from virgin or raw materials, which feeds subsequent production steps." This revision is intended to more accurately describe the fundamental characteristic of a commodity-like material used in production, which is that it will be used as a viable substitute for a product or intermediate. A partially-reclaimed material would meet this criterion if it is analogous to, or, in other words, would replace, valuable products or intermediates in the manufacturing process that have been produced (i.e., partially reclaimed) from raw materials but require further processing (reclamation) steps before the manufacturing process is complete. Evidence to support this criterion would include a comparison of the physical and chemical characteristics of the partially-reclaimed material being considered for the variance to those of products or intermediates produced from virgin raw materials.
	EPA requests comment on whether the proposed revisions clarify the criterion and appropriately describe the fundamental characteristic of a commodity-like material related to substituting for a product or raw material in a production process.
 4. The extent to which an end market for the reclaimed material is guaranteed.
	EPA is proposing to revise this criterion to read as follows:
(4) Whether there is a guaranteed end market for the partially-reclaimed material.
      This criterion addresses the third of four fundamental characteristics of a commodity-like material, whether there is an end market for the partially-reclaimed material. As with other criteria, EPA is proposing to add the word "partially-" before the word "reclaimed" to clarify that the criterion applies to the partially-reclaimed material for which the variance is sought. An end market for further reclaimed material produced at a later stage of reclamation cannot be used to justify a variance for a partially-reclaimed material. EPA requests comment on whether this proposed revision clarifies the criterion effectively.
      In addition, although EPA is not proposing any other substantive changes to the criterion, based on experience with the variance provision, EPA believes that further explanation of this criterion is necessary. The criterion requires an evaluation of whether an end market is guaranteed for the material for which a variance is requested. For example, if a facility requests a variance for an incoming hazardous waste, the end market that would have to be evaluated is the market for the incoming hazardous waste itself. A demonstrated end market for materials the facility produces later from the incoming hazardous waste would not be relevant to the analysis for the incoming waste.
      For an end market for a partially-reclaimed material to be guaranteed, there must be secure demand and long-term markets for the material. This would make it unlikely that large quantities of the material will be stockpiled for long periods of time, lost, or mismanaged due to insufficient demand. Assessing whether an end market is guaranteed for the partially-reclaimed material requires that the applicant for the variance provide end market information for the material generated by the partial reclamation step. Evidence to support this criterion may include the material's value as an input to a production process, traditional usage of quantities of the material, contractual arrangements for use of the material, and the likely stability of markets for the material. Furthermore, the end market must be demonstrated by a record of multiple actual purchases of the partially-reclaimed material by other parties. Further reclamation that can only be conducted by the facility seeking the variance is not proof of an end market.
5. The extent to which the reclaimed material is handled to minimize loss.
	EPA is proposing to revise this criterion to read as follows:
(5) Whether the partially-reclaimed material is handled to minimize loss.
      This criterion addresses the fourth of four fundamental characteristics of a commodity-like material, whether the partially-reclaimed material is handled to minimize loss, or in other words, is handled similarly to a commodity. As with other criteria, EPA is proposing to add the word "partially-" before the word "reclaimed" to clarify that the criterion applies to the partially-reclaimed material for which the variance is sought. Management of materials produced at later stages of reclamation is not relevant to how the partially-reclaimed material itself is handled. EPA requests comment on whether this proposed revision clarifies the criterion effectively.
	In addition, EPA's experience with the variance provision indicates that further explanation of this criterion is necessary. Specifically, this criterion requires evaluation of how the partially-reclaimed material is handled before it is further reclaimed. Handling a partially-reclaimed material to minimize loss indicates that the material is commodity-like. Generally, persons handling hazardous waste with little or no economic value do not have the same incentives to minimize loss as persons handling commodities. Evidence to support this criterion may include documentation of facility procedures used to minimize loss (e.g., inspections, training), and storage and management equipment designed to minimize loss.
6. Revision to eliminate criterion six.
	Finally, EPA is proposing to eliminate the sixth and final criterion, "(6) other relevant factors." When the partial reclamation variance was promulgated in 1985, EPA believed that this criterion could help determine whether a material is commodity-like. However, based on experience with the variance provision, EPA now believes that criteria numbers 2, 3, 4, and 5 (as proposed to be revised) together accurately and fully reflect the fundamental substantive characteristics of a commodity-like material for the situation where a material has been partially reclaimed but must go on for further reclamation before it is a final commercial product. We have not seen other essential characteristics of this type of commodity-like material identified in variances or applications. Thus, we are proposing to eliminate this criterion. We also believe that removing this general criterion will result in more consistent and appropriate decision-making for partial reclamation variances.
	EPA requests comment on removing the sixth criterion and whether there are any additional characteristics that should be evaluated to assess whether a material is commodity-like. EPA also requests comment on whether one or more of the five remaining criteria should be consolidated.
C. Proposed Change to Non-Waste Determinations
      EPA is also proposing to add a criterion to both non-waste determinations that require facilities applying for a non-waste determination to explain or demonstrate why they cannot meet, or should not have to meet, the existing DSW exclusions under §§ 261.2 or 261.4. Because commenters to the 2009 DSW public meeting notice have argued that the non-waste determinations may be burdensome to states, EPA believes requiring applicants to formally consider and explain why they are not eligible for an existing DSW exclusion will reduce the burden on states. This criterion reduces burden on states in two ways: (1) it requires facilities to consider existing exclusions and standards first, before pursuing a non-waste determination, which can, in turn, lead to facilities discovering that their intended recycling fits under an existing exclusion and therefore a non-waste determination petition is not needed; and (2) this criterion informs the state why a facility believes it cannot meet an existing exclusion, which is likely to be the state's first question before evaluating a non-waste determination petition. Petitioners also would be allowed to seek non-waste determinations if they could show that they should not have to meet the conditions of another exclusion, but rather should be allowed to operate under a non-waste determination with fewer or different conditions. However, if EPA or the authorized state determines that an applicant may, in fact, use an existing solid waste exclusion under §§ 261.2 or 261.4, this may be grounds for denying a non-waste determination on the basis that regulatory relief has already been granted.
D. Designating the Regional Administrator to Receive Petitions
      Lastly, we are proposing to change the word "Administrator" to "Regional Administrator" in 40 CFR 260.30, 260.31, 260.32, 260.33, and 260.34. Due to the case-specific nature of the variances and non-waste determinations, we believe these decisions should be made by the Regional Administrator because of his or her regional authority. We also note that although we propose to assign the decision-making authority to the Regional Administrator, it is common practice within EPA to work with other EPA offices, EPA Regions, EPA Headquarters on decisions that may affect national policy.
E. Request For Comment On Other Possible Steps To Help Ensure National Consistency And Protectiveness In The Implementation Of Variances And Non-Waste Determinations
	EPA is also requesting comment on other possible steps to help ensure national consistency and protectiveness in the implementation of variances and non-waste determinations.
	First, EPA is requesting comment on whether to require variances and non-waste determinations to be renewed periodically, and, if so, what time period would be appropriate (e.g., two or five years). A renewal period would help ensures the hazardous secondary materials continue to meet the criteria and remain valid over time. To a certain extent, this concern would be addressed by the proposed revision to 40 CFR 260.33(c), which would require applicants to re-apply for a variance or non-waste determination in the event of a change in circumstances that affect how hazardous secondary materials meet the relevant criteria, and by the proposed biennial re-notification, which would require the applicant to review the management of their hazardous secondary materials. However, the proposed revision to 40 CFR 260.33(c) still relies on the applicant to recognize when there is a need to reconsider a variance and take action, while a specific renewal period would mandate a reconsideration. On the other hand, mandating a renewal period would be an additional burden to the states, and may not be necessary in all situations. Additionally, regulators could always stipulate time limits in specific determinations, if warranted. EPA requests comment on whether to require a renewal period and, if so, how to minimize the burden on the states.
      The second possible change EPA is requesting comment on is whether to require states to share copies of the variance and non-waste determination petitions and the tentative decisions with EPA to allow the Agency to comment and to encourage collaboration and national consistency. EPA and the states share responsibility for environmental protection and work as partners to solve the nation's environmental challenges. Because solid waste variances and non-waste determinations are made on a case-by-case basis, state governments are best situated to understand and evaluate the specific factors involved with the company submitting a petition. At the same time, EPA may be familiar with similar cases in other states or EPA Regions and can often provide additional expertise and a national perspective on issues that affect more than one location. As a general matter, the state and EPA frequently consult on such cases, helping to achieve the best results possible, taking full advantage of the unique strengths of each partner.
      However, formalizing this type of collaboration would have the benefit of reinforcing this working relationship and would help ensure national consistency. Thus, EPA requests comment on whether to require authorized states to forward to EPA copies of solid waste variance and non-waste determinations petitions and tentative decisions on those petitions for review and comment.
XII. Request for Comment on Re-Manufacturing Exclusion
A. Background
      In addition to the proposed changes to the definition of solid waste discussed in Sections VII - XI of this preamble, EPA is requesting comment on a focused exclusion from the definition of solid waste for certain types of higher-value hazardous secondary materials which are being re-manufactured into commercial-grade products.
      The goal of the re-manufacturing exclusion would be to encourage sustainable materials management by identifying specific types of transfers of hazardous secondary materials to third parties that, under appropriate conditions, do not involve discard and can result in extending the useful life of a commercial-grade chemical.
	Sustainable materials management, as discussed in more detail in Section V.J. of this preamble, considers system-wide impacts, and represents a shift away from end-of-life waste management and toward a more sustainable future that avoids unintended consequences. The benefits of sustainable materials management broadly include potential reductions in energy used, more efficient use of materials, more efficient movement of goods and services, conservation of water, reduced greenhouse gas and other air emissions, and reduced volume and toxicity of waste. In particular, when hazardous secondary materials can be kept in the manufacturing process, rather than disposed of, or used in a lower-value process such as cleaning or degreasing, substantial environmental benefits can be obtained.
      As discussed in Section VII of this preamble, EPA is proposing to replace the transfer-based exclusion found in 40 CFR 261.4(a)(24) and (a)(25) with an alternative Subtitle C regulatory scheme because of the potential for adverse impacts to human health and the environment from discarded hazardous secondary materials. EPA believes that such a standard would be more appropriate for hazardous secondary material  because (1) the Agency reasonably believes (as explained in detail in the 2008 DSW final rule) that, absent specific conditions, transfers of hazardous secondary materials to third-party reclaimers generally involve discard, and (2) the conditions of the 2008 DSW final rule have serious gaps, particularly the incentives to accumulate larger volumes of hazardous secondary materials, the reduction in oversight resulting from eliminating the permit requirement for storage, and the reduction in the public's access to information and the opportunity for public participation,  that could create a potentially unacceptable likelihood of adverse effects to human health and the environment from such discarded material.
      However, as also discussed in Section VII, EPA acknowledges that some specific types of hazardous secondary materials are more like valuable commodities than solid wastes, and thus the act of transferring them to a third party under appropriate conditions does not necessarily involve discard. From a sustainable materials management perspective, these materials are the ideal candidates for focused regulatory changes that would address their life-cycle impacts and help extend their useful life. Many of the other exclusions in 40 CFR 261.4(a) were developed for these types of hazardous secondary materials, and the non-waste determination process under 40 CFR 260.34(c) provides an administrative process for additional hazardous secondary materials that are indistinguishable from a product to be determined to be non-wastes.
	To further encourage sustainable materials management,, EPA is requesting comment on an exclusion for the transfer of higher-value hazardous secondary materials from one manufacturer to another, for the purpose of extending the useful life of the original material product by keeping such materials in commerce to reproduce a commercial grade of the original material product (a process that for the purpose of this preamble discussion EPA is defining as "re-manufacturing"). Re-manufacturing these higher-value hazardous secondary materials can have significantly lower environmental impact than creating these material products and using them one time in their virgin state and then transferring them for off-site treatment and disposal, especially with regards to non-renewable materials. Thus, re-manufacturing allows the material products to be used again, lowering their life-cycle environmental impacts significantly.
      Specifically, EPA has reached a preliminary conclusion that, under appropriate conditions, the potential for discard in inter-company re-manufacturing transfers for certain higher-value spent solvents would be low because they will be incorporated into the manufacturing process rather than accumulated or disposed of. Once these solvents are re-manufactured to commercial grade, they can be used as replacements for virgin commercial grade solvents. The economic incentive for a company receiving the spent solvents would be to sell or directly use (avoiding purchase of virgin product) the re-manufactured solvent products to realize an economic value. The company sending these higher-value hazardous secondary materials for re-manufacturing is expected to have little economic incentive to pay the receiving company more than a nominal amount of money, since it would already be transferring something of intrinsic market value (materials that can be easily re-manufactured for profit). So, unlike the RCRA-permitted waste handler which can charge a considerable fee for receiving discarded waste, the company receiving these higher-value hazardous secondary materials for re-manufacturing is expected to realize most of its profit from the sale or use of re-manufactured solvents.
      Once re-manufacturing processes are in place, EPA expects that solvent re-manufacturers would be competitive with solvent manufacturers even in the event of a downturn in the sizable chemical markets. Companies would also have the flexibility to redirect re-manufacturing capacity to manufacturing should it ever make economic sense to do so, leaving little economic reason to accumulate unsold or unused re-manufactured solvents.
      Although the following discussion focuses mainly on spent solvents, EPA would welcome information on other types of non-renewable hazardous secondary materials that could benefit from a focused regulatory change that would encourage sustainable materials management and be protective of human health and the environment.
B. Conditions for the Re-Manufacturing Exclusion
	Given the wide variety of hazardous secondary materials and industrial processes, EPA believes it is reasonable to set conditions for the exclusion which there is supporting evidence that discard will be avoided and risk will be controlled. The supporting evidence that EPA is relying on for defining the conditions of this exclusion has been gathered from some of the Agency's ongoing efforts to promote sustainability and resource conservation.
      In particular, the Green Engineering Program within the Office of Chemical Safety and Pollution Prevention (OCSPP) has for several years been studying re-manufacturing scenarios for "once-used" solvents in several industry sectors that use solvents as chemical manufacturing and processing aids. By focusing on the life-cycle (cradle-to-grave) impact of the manufacture, process, and use of chemicals, and reviewing Toxics Release Inventory (TRI) production-related waste reporting, EPA has found that a large, but often hidden lifecycle environmental impact of a final consumer product is from the solvents used to produce the consumer product. For example, pharmaceutical manufacturers use at least 100 kg of solvents to make 1 kg of active pharmaceutical ingredient. The lifecycle impact of these solvent streams, which often are disposed after a single use under current regulatory conditions, is very high.EPA has determined that the environmental impacts from solvents used as manufacturing and processing aids could be significantly reduced if the product life of solvents used for these purposes were extended to more than a single use.
	Based on this information, EPA proposes that all of the following conditions would need to be satisfied for eligibility under a re-manufacturing exclusion. The purpose of these conditions is to ensure that the exclusion would focus on higher-value hazardous secondary materials that are being re-manufactured rather than discarded.
   (1) The hazardous secondary material consists of one or more of the following solvents: toluene, xylenes, ethylbenzene, 1,2,4-trimethylbenzene, chlorobenzene, n-hexane, cyclohexane, methyl tert-butyl ether, acetonitrile, chloroform, chloromethane, dichloromethane, methyl isobutyl ketone, N,N-dimethylformamide, tetrahydrofuran, n-butyl alcohol, ethanol, and methanol;
   (2) The hazardous secondary material originated from using one or more of the above-listed solvents in commercial grade for reacting, extracting, purifying, or blending chemicals in the pharmaceutical, organic chemical, or plastics and resins manufacturing sectors, or the paint and coatings sector;
   (3) After re-manufacturing, the continuing use of the solvent is limited to reacting, extracting, purifying, or blending chemicals in the pharmaceutical, organic chemical, or plastics and resins manufacturing sectors, or the paint and coatings sector, or using them as ingredients in a product. These allowed continuing uses correspond to chemical functional uses enumerated under the proposed modification to the Inventory Update Rule of the Toxic Substances Control Act (40 CFR Parts 704, 710 - 711), including Industrial Function Codes U015 (solvents consumed in a reaction to produce other chemicals) and U030 (solvents become part of the mixture).
   (4) After re-manufacturing, the continuing use of the solvent does not involve cleaning or degreasing oil, grease, or similar material from textiles, glassware, metal surfaces, or other articles (These disallowed continuing uses correspond to chemical functional uses in Industrial Function Code U029 under the proposed modification of the Inventory Update Rule of the Toxics Substances Control Act);
   (5) Additionally, both the hazardous secondary material generator and the re-manufacturer would have to
         a. Notify EPA or the State Director, if the state is authorized for the program, and update the notification every two years per 40 CFR 260.42;
         b. Develop and maintain a re-manufacturing plan which includes information on the types and expected annual volumes of solvents to be re-manufactured, the processes and industry sectors that generate the solvents, the specific uses and industry sectors for the re-manufactured solvents and the legitimacy of the re-manufacturing process;
         c. Maintain records of shipments and confirmations of receipts for a period of three years from the dates of the shipments;
         d. Prior to re-manufacturing, store the hazardous spent solvents in tanks or containers that meet technical standards that would be the same as those found in 40 CFR part 264 subparts I and J, with the tanks and containers being labeled or otherwise having an immediately available record of the material being stored;
            During re-manufacturing, and during storage of the hazardous secondary materials prior to re-manufacturing, ensure that there is effective control of hazardous air emissions by complying with all applicable NESHAP standards, and with the requirements of 40 CFR part 264 or 265 subparts AA, BB, CC; and
         e. Meet the requirements prohibiting speculative accumulation per 40 CFR 261.1(c)(8).
   The rationale for the data elements under each condition is provided below. EPA requests comment on each of the conditions, the specific data elements under each condition, and/or any other types of scenarios that might also meet EPA's proposed definition of re-manufacturing (i.e., the transfer of a higher-value secondary material from one manufacturer to another, for the purpose of keeping the hazardous secondary material in commerce to produce a commercial grade product). In addition, EPA requests comment on whether, as part of the re-manufacturing plan, the hazardous secondary materials generator and the re-manufacturer should be required to estimate the energy and environmental benefits of re-manufacturing versus the use of virgin feedstock.
1. Designated Solvents
	EPA has identified 18 chemicals that could be included in the re-manufacturing exclusion. They are toluene, xylenes, ethylbenzene, 1,2,4-trimethylbenzene, chlorobenzene, n-hexane, cyclohexane, methyl tert-butyl ether, acetonitrile, chloroform, chloromethane, dichloromethane, methyl isobutyl ketone, N,N-dimethylformamide, tetrahydrofuran, n-butyl alcohol, ethanol, and methanol.
	EPA believes that including these 18 chemicals in a re-manufacturing exclusion is a good opportunity for reducing the risks associated with these chemicals at the present time. Risk is a function of hazard and exposure, and, from a hazard perspective, all of these chemicals have suspected or recognized hazardous health effects associated with their manufacture, processing, and use.   Although EPA and industry have been working to find substitutes for the more hazardous of these solvents, or find ways to use less of them, this has not yet been achieved. [,] With respect to the pharmaceutical sector in particular, complex chemical processes already registered with the Food and Drug Administration are involved, and EPA has found this a very challenging area to address. In addition, some of these solvents are building block and primary intermediate chemicals, making them difficult to replace. Until lower-risk substitutes for these solvents are found, it is helpful from a health risk standpoint to minimize the volume of solvents manufactured and to limit exposure to those already manufactured. This is something that the re-manufacturing exclusion can help achieve.
      The exclusion can help reduce exposure to these solvents in three ways. First, the exclusion would extend the useful life of existing solvents, which would reduce the health risks associated with their manufacture by slowing the rate at which they are manufactured. Second, the exclusion would reduce exposure to solvents already manufactured by reducing the fuel blending of spent solvents. Re-manufacturing a spent solvent will eliminate the need for blending it with another spent solvent to satisfy the fuel-ratio requirements of incinerators and cement kilns. This, in turn, will reduce the fugitive emissions associated with unloading and loading containers of volatile solvents at fuel-blending facilities. All solvents are volatile, and virtually all spent solvents must go through the fuel-blending process prior to disposal. Third and finally, the exclusion can reduce the potential exposure from any transportation incidents, since it is likely spent solvents can be transported shorter distances for re-manufacturing purposes than they can for disposal purposes.
      These 18 solvents are used in large volumes as chemical manufacturing aids, chemical processing aids, and chemical formulation aids (generally referred to as "processing aids" for the purpose of this rule). The "processing aids" solvents assist in the reaction, extraction, purification, and blending of ingredients and reactive products, but are not themselves reacted. These processing aid solvents, once used, can then be re-manufactured to commercial grade again. These higher-value solvents were selected because there are existing markets for all these solvents to be re-manufactured to serve similar purposes to those of the original commercial-grade materials.
	Note that, as explained below, these hazardous spent solvents would only be eligible if their originating use was of a specific type, and if they are re-manufactured to serve certain types of commercial functions. This restriction would help limit the exclusion to higher-value materials and processes that resemble manufacturing more than waste management.
      EPA believes that spent solvents are particularly appropriate for the re-manufacturing exclusion because they are derived from a non-renewable resource (petroleum), and they are manufactured in the industrial chemicals sector, which, according to EPA's report on sustainable materials management, ranks third overall as far as direct adverse overall impact to the environment. EPA requests comment on whether these solvents are appropriate for inclusion in the re-manufacturing exclusion, and whether there are other solvents, chemicals or other types of hazardous secondary materials that should be included in the re-manufacturing exclusion. In particular, EPA requests comment on opportunities for re-manufacturing other types of non-renewable hazardous secondary materials, such as metal catalysts or other types of metal-bearing hazardous secondary materials.
2. Chemical Functions
      EPA believes that the re-manufactured chemical product should serve a similar functional purpose as the original commercial-grade material so that it can substitute for virgin product, since it is this substitution that displaces some manufacturing of virgin product and fosters a system where the original solvent remains in commerce and is not discarded. EPA has identified the following chemical functions for possible inclusion in the re-manufacturing exclusion: chemical manufacturing aid (reacting, extracting, blending and/or purifying chemicals), and chemical processing aid (extracting, blending and purifying chemicals). The solvents used for these functions can be separated readily from the other reaction components and therefore do not get contaminated as do solvents used for cleaning or degreasing operations, which are more likely to become discarded.
      More environmental benefits will be obtained by maximizing the number of times a chemical product can be used at high-purity grade as an aid to chemical manufacturing and processing, before it is used for at lower-purity as a cleaner or degreaser. While it is possible to extend the product life of a used chemical as a cleaner/degreaser, it takes significantly less energy to bring solvents used as chemical manufacturing aids back to commercial grade than to bring solvents used as cleaners and degreasers back to lower grade functionality, making re-manufacturing of the higher-value solvents more economically feasible.
      Accordingly, the functions that the re-manufactured chemical products should serve would be the same as those enumerated above, plus the use in the formulation of the final product (a function which causes the solvent to remain in the product), or use as a chemical intermediate (a function which causes the solvent to be consumed in a chemical reaction).
      With respect to the hazardous secondary material generator, this exclusion would focus on the functions of aiding chemical manufacturing and processing because the solvents performing these functions retain their original physical and chemical properties. In these functions, the solvents do not get contaminated by substances from which they are difficult to separate, such as inks and greases, but only get mixed with pure product ingredients, from which they can be separated readily in a commercially feasible manner. Furthermore, manufacturing and processing operations can be more easily controlled in terms of exposure and releases, whereas the spent solvents from downstream uses such as degreasing and cleaning operations are of inherently lower-value and these downstream operations result in more widespread exposure and releases and a higher potential for discard.
      EPA requests comment on whether these chemical functions are appropriate for inclusion in the exclusion and whether there are other chemical functions that should also be included in the re-manufacturing exclusion.
3. Manufacturing Sectors
      EPA intends that any exclusion would be limited to companies whose primary business is manufacturing, rather than waste management, as indicated by particular NAICS codes. EPA has identified the operations of four manufacturing sectors as candidates for the re-manufacturing exclusion: pharmaceutical manufacturing (NAICS 325412), basic organic chemical manufacturing (NAICS 325199), plastics and resins manufacturing (NAICS 325211), and the paints and coatings manufacturing sectors (NAICS 325510). Manufacturers within these four sectors all use one or more of the eighteen identified solvents as chemical manufacturing, processing, and formulation aids in high volumes. Based on the Toxics Release Inventory information, these four sectors are also closely associated with the chemical functions identified in the exclusion and currently use a high volume of the solvents for the functional purposes included in this exclusion. Therefore, these four sectors seem to be good candidates for inclusion in the exclusion.
      As discussed earlier, companies whose primary business is the sale of a commercial product do not operate under the same market forces as commercial recyclers, whose profit depends on maximizing the amount of hazardous secondary material accepted, creating a perverse market incentive to over-accumulate hazardous secondary material, resulting in discard. It is not intended that the exclusion could be utilized by a commercial recycler even if it undertook reclamation operations involving the chemicals and chemical functions described above. Commercial recyclers are best regulated by the RCRA hazardous waste standards since waste handling is their primary business and RCRA standards are the primary governing standards for this line of business.
      EPA requests comment on whether these sectors are appropriate for inclusion in the exclusion, and whether there are other industry sectors that should be included in the re-manufacturing exclusion. In particular, while the re-manufacturing exclusion on which EPA is requesting comment focuses on those industry sectors that generate large volumes of spent solvents, we also are interested in other industry sectors that would generate other materials, especially other types of non-renewable materials, such as metal-bearing hazardous secondary materials. For example, the "2020 Vision Report" identifies industry sectors that could be evaluated and for which significant environmental gains could be realized through sustainable materials management. Thus, EPA requests comment on which sectors provide the most opportunity for reducing overall environmental impact by encouraging sustainable materials management through re-manufacturing.
4. Additional Exclusion Conditions
	EPA has identified the following additional conditions as necessary for the proper implementation of a re-manufacturing exclusion and to ensure that the hazardous secondary materials are managed in a way that does not involve discard.
a. Notification. Notification under a re-manufacturing exclusion would serve the same purpose and operate similarly to the notification provision found at 40 CFR 260.42. In other words, hazardous secondary material generators and re-manufacturers would have to submit a notification prior to operating under the exclusion and by March 1 of each even-numbered year thereafter using EPA form 8700-12 to the EPA Regional Administrator or the State Director, in an authorized state. Additionally, these facilities would have to notify within 30 days of stopping management of hazardous secondary materials under the exclusion. The notification would include:
::	The name, address and EPA ID number (if applicable) of the facility;
::	The name and telephone number of a contact person;
::	The NAICS and TRI code of the facility;
::	When the facility expects to begin managing the hazardous secondary material in accordance with the re-manufacturing exclusion;
::	A list of the hazardous secondary materials that would be managed according to the new standard (reported as the EPA hazardous waste numbers that would apply if the materials were managed as hazardous waste);
::	The quantity of each hazardous secondary material solvents to be managed annually; and
::	The certification signed and dated by an authorized representative of the facility.
      The intent of the notification requirement is to provide basic information to the regulatory agencies about who will be managing hazardous secondary materials under the re-manufacturing exclusion. The specific information included in the notification requirement enables regulatory agencies to monitor compliance and to ensure hazardous secondary materials are managed in accordance with the exclusion and not discarded.
b. Re-manufacturing plan. A key issue for a re-manufacturing exclusion would be how the facilities operating under the exclusion would demonstrate that they meet the requirements (e.g., that the hazardous secondary materials, functions, and manufacturing sectors are those identified in the exclusion). A straightforward method would be to require a re-manufacturing plan to be prepared and maintained by both the hazardous secondary material generator and re-manufacturer that includes information on the types and expected annual volumes of solvents to be excluded, the processes and industry sectors that generate the chemicals, the specific uses and industry sectors -- for the re-manufactured solvents, and the legitimacy of the re-manufacturing process (see Section X for further discussion on legitimacy). The hazardous secondary material generator would also be required to make arrangements with the re-manufacturer to jointly develop this plan and to verify the appropriateness of the hazardous secondary materials for the re-manufacturing process before claiming the exclusion, thus helping ensure that the hazardous secondary material will be re-manufactured and not discarded.
c. Record of shipments and confirmations of receipts. Under a re-manufacturing exclusion, generators and re-manufacturers would need to maintain at the facility records of shipments of hazardous secondary materials for a period of three years. Specifically, for each shipment of hazardous secondary material, the generator and re-manufacturer would need to maintain documentation of when the shipment occurred, who the transporter was, and the type and quantity of the hazardous secondary materials in the shipment. This recordkeeping requirement may be fulfilled by ordinary business records, such as bills of lading. However, EPA requests comment on whether for ease of implementation and enforcement, it should require more standardized record-keeping, such as the use of a standardized bill of lading.
      In addition, generators would need to maintain confirmations of receipt for all off-site shipments of hazardous secondary materials in order to verify that the hazardous secondary materials reached their intended destination and were not discarded. These receipts must be maintained at the facility for a period of three years from when they were created. Specifically, the documentation of receipt would include the name and address of the re-manufacturer, and the type, quantity, and date of hazardous secondary materials received. The Agency might not require a specific template or format for confirmation of receipt since routine business records (e.g., financial records, bills of lading, copies of Department of Transportation (DOT) shipping papers, and electronic confirmation of receipt) would contain the appropriate information sufficient for meeting this requirement. However, documented information must be verifiable. Therefore, EPA requests comment on whether for ease of implementation and enforcement, it should require more standardized record-keeping, such as requiring a standard method of confirmation of receipt and/or keeping this information in a readily accessible file.
      This provision is being proposed in order that all parties responsible for the excluded hazardous secondary materials would be able to demonstrate that the materials were in fact sent for re-manufacturing and arrived at the intended facility and were not discarded in transit.
d. Management in tanks and containers. Solvents, whether virgin or spent, are best stored in tanks or containers that possess inherent controls to address issues such a volatile air emissions, leaks, and fires or explosions. As discussed in Section VI of this preamble, spent solvents present particular management challenges associated with the storage of liquids containing volatile organic chemicals and include both halogenated and non-halogenated organic chemicals, which represent a broad range of chemicals and associated hazards.
      EPA believes that by focusing on higher-value spent solvents going to re-manufacturing, a re-manufacturing exclusion reduces the chance of mismanagement of the spent solvents. However, given the history of solvent mismanagement, as demonstrated in the damage cases found in environmental problems study, EPA also believes it would be appropriate to make an explicit condition that spent solvents excluded under a re-manufacturing exclusion be labeled or otherwise have an immediately available record of the material being stored and be stored prior to re-manufacturing in tanks or containers that meet technical standards that will ensure that the solvents will go to re-manufacturing and will not be discarded via leaks, spills or explosions.
	For ease of implementation, EPA requests comment on establishing explicit tank and container standards which meet the technical standards that would be the same as those found in 40 CFR part 264 subparts I and J. The tank and container standards of 40 CFR part 264 were developed for hazardous wastes, but an analysis of the full set of technical requirements under subparts I and J shows that they are comparable to product storage standards from a number of sources, including regulations promulgated under the Occupational Safety and Health Act (OSHA), DOT, and industry standards, and may also be appropriate standards for storage prior to re-manufacturing. Establishing technical standards equivalent to subparts I and J has the benefit of using standards that the regulated community are already familiar with, and which are designed to prevent the spent solvents from being discarded through leaks or explosions. EPA also believes that during re-manufacturing and storage prior to re-manufacturing, there should be effective controls of hazardous air emissions. This can be ensured by requiring that equipment, vents, and tanks meet the technical standards of the National Emission Standards for Hazardous Air Pollutants (NESHAP) applicable to the sector, or absent such standards for the particular operation or piece of equipment covered by the exemption, then the standards equivalent to those found in 40 CFR part 264 or 265 subparts AA (vents), BB (equipment) and CC (tank storage).
      EPA requests comment on using these standards or other alternative standards that would be appropriate for helping to demonstrate that the excluded spent solvents under the re-manufacturing exclusion are being managed as a commodity rather than being discarded.
e. No speculative accumulation. In addition to the other conditions, hazardous secondary materials under a re-manufacturing exclusion would still be subject to the speculative accumulation restrictions in 40 CFR 261.1(c)(8), which includes both a time limitation and a requirement that the facility be able to show that there is a feasible means of recycling/recovering the hazardous secondary material. This helps ensure that the materials are re-manufactured and not discarded.
	EPA requests comment on whether these conditions are appropriate and whether there are additional conditions that should be also included in any re-manufacturing exclusion.
C. Benefits of Re-Manufacturing Exclusion
      The solvents identified as possible candidates for a re-manufacturing exclusion are highly energy-intensive and carbon-intensive at their creation and destruction. Therefore, any step towards extending the useful life of these solvents (e.g., re-manufacturing via distillation) significantly reduces the energy use and carbon release associated with these solvents, as well as other pollutants associated with their manufacturing and disposal. Using solvents multiple times instead of once means fewer solvents need to be produced and destroyed, which reduces the energy consumed for solvent production and destruction. That is, less fuel is needed to re-manufacture solvents than to produce solvents from virgin materials. The reduction in fuel for manufacturing is significant because solvent manufacture is energy intensive due to a combination of the high and low temperature manufacturing steps involved. Also, less fuel is needed to destroy solvents (at very high temperatures) if fewer solvents are being destroyed. Lastly, less pollution, including carbon, is released from the solvents themselves when incinerated or burned as fuel at the end of their useful life if fewer solvents are being incinerated or burned.
      There is also a benefit of reduced transportation impacts associated with extending the useful life of solvents. EPA research indicates that in numerous instances the transport involved in transferring a quantity of spent solvents for purposes of re-manufacturing (including any delivery to secondary users) is measurably less than the transport required for an equal quantity of solvents disposed of and replaced with new solvents. In addition, transportation impacts of virgin feedstocks would also be reduced. Thus, allowing hazardous secondary material generators to re-manufacture solvents is also likely to reduce the risks to communities by reducing the likelihood of transportation accidents involving hazardous materials, as well as reducing other adverse environmental impacts from fuel consumed in transportation.
      Further, reduced manufacturing of virgin solvents would reduce the quantity of ingredients needed and the toxic and hazardous pollutant releases associated with solvent manufacture. Moreover, a re-manufacturing exclusion would create a business-case incentive for hazardous secondary material generators to re-manufacture solvents. Reducing the economic barriers to solvent re-manufacturing (in particular, avoiding the costs associated with RCRA permitting) would make it commercially feasible for more chemical manufacturers to re-manufacture solvents, and would thus serve to encourage chemical manufacturers to reduce the overall environmental impacts of solvent manufacturing and use.
      Finally, the benefit of limiting the functions of re-manufactured material to those performed by chemical manufacturers, processors, and formulators is that there are existing commercial purposes for re-manufactured solvents, which would limit or prevent the over-accumulation of the spent solvents, which also reduces the likelihood for discard.
D. Potential Rulemaking Variance Process to Add Candidates for Re-Manufacturing Exclusion
      EPA is requesting comment in today's proposal on a re-manufacturing exclusion that is narrowly defined to apply to 18 solvents used for specific functions within four industry sectors. However, it is possible that other hazardous secondary materials, industry sectors, and/or functional uses may also be suitable candidates for the re-manufacturing exclusion if they involve the transfer of a higher-value hazardous secondary material from one manufacturer to another, for the purpose of re-manufacturing a material with significant commercial value. If the Agency were to promulgate a re-manufacturing exclusion, EPA is requesting comment on whether to also include a specific petition process where petitioners may apply to EPA to request a hazardous secondary material, industry sector, and/or functional use be added to the exclusion.
      The petition process would be similar to 40 CFR 260.20, where any person may petition the Administrator to modify or revoke any provisions of the hazardous waste rules. Thus, in the context of a re-manufacturing exclusion, any person would be able to petition the Administrator to add or remove hazardous secondary materials, industry sectors, and/or specific use functions to the list of hazardous secondary materials qualifying for this exclusion. To be successful, the petitioner would need to demonstrate to the satisfaction of the Administrator that the proposed regulatory amendment (1) meets the goal of the re-manufacturing exclusion, which is to encourage sustainable materials management by extending the productive life of a hazardous secondary material; (2) involves the transfer of a higher-value hazardous secondary material from one manufacturer to another for the purpose of re-manufacturing the hazardous secondary material to produce a product of significant commercial value; and, (3) results in neither the hazardous secondary materials nor the products recovered being discarded when the conditions of the exemption are followed. The application could be required to include (1) the petitioner's name and address; (2) a statement of the petitioner's interest in the proposed action; (3) a description of the proposed action, including the specific hazardous secondary material, industry (i.e., NAICS code) and functional use (i.e., industrial functional code listed in 40 CFR 710.52(c)(4)(i)(C)); and (4) a statement of the need and justification for the proposed action, including any supporting tests, studies, or other information.
      Under this possible petition process, the Administrator would make a tentative decision to grant or deny a petition and then publish notice of such tentative decision, either in the form of an advanced notice of proposed rulemaking, a proposed rule, or a tentative determination to deny the petition, in the Federal Register for written public comment. The Administrator could, at his discretion, hold an informal public hearing to consider oral comments on the tentative decision.
      After evaluating all public comments, the Administrator would make a final decision by publishing in the Federal Register a regulatory amendment or a denial of the petition.
E. Other Issues Related to a Possible Re-Manufacturing Exclusion
      A re-manufacturing exclusion, as described above, would be based on a direct business arrangement between the hazardous secondary material generator of spent solvents and the re-manufacturer, such that the spent solvents would be shipped directly from the generator to the re-manufacturer. Therefore, EPA does not believe that it would be necessary or appropriate to include intermediate storage facilities in the exclusion. We also believe that including such intermediate storage facilities would make it harder to keep track of the hazardous secondary materials and would increase storage time frames, potentially increasing the likelihood that the hazardous secondary materials will not be safely recycled. However, the Agency also recognizes that not allowing intermediate storage facilities to be part of the transaction may have an adverse impact on small businesses since such intermediate storage facilities would allow small businesses to ship their spent solvent, that are likely generated in limited quantities, to the intermediate facility for consolidation before they go to the re-manufacturer. Thus, EPA requests comment on this issue.
      Similarly, EPA anticipates that re-manufacturing arrangements would be made within the United States, so that the companies involved would be governed by the same set of laws and regulations as far at their re-manufacturing agreements are concerned. EPA requests comment on limiting the re-manufacturing exclusion to the United States, or requiring the generator to notify the receiving country through EPA and obtain consent from that country before shipment of the hazardous secondary materials takes place. These notice and consent requirements, which would be the same as those currently required under the transfer-based exclusion (see 40 CFR 261.4(a)(25)), would provide notification to the receiving country so that it can ensure that the hazardous secondary materials are reclaimed rather than disposed of or abandoned. As an additional benefit, these requirements would allow the receiving country the opportunity to consent or refuse consent based on its analysis of whether the re-manufacturing facility can properly manage the hazardous secondary materials in an environmentally sound manner within its borders.
      EPA also requests comment on other possible conditions that could be added to any re-manufacturing exclusion. In particular, EPA requests comment on whether it should require the re-manufacturer to have financial assurance. EPA required financial assurance for recyclers under the transfer-based exclusion. Since the re-manufacturing exclusion will be limited to higher-value solvents going to manufacturers with a greater flexibility than commercial recyclers to adjust to unstable markets, there may be less of a need for financial assurance under this proposed exclusion. However, EPA requests comment on whether financial assurance should nevertheless be included as a condition to best ensure against discard. EPA also requests comment on whether it should add public participation requirements and/or a regulatory agency approval (short of a RCRA permit) before a re-manufacturer may start handling hazardous secondary materials sent from another company. EPA received input during its environmental justice review of the 2008 DSW final rule that the absence of an opportunity for public input was a deficiency of the transfer-based exclusion. However, since the re-manufacturing exclusion will be limited to manufacturing facilities, typically at their already existing locations, and actually may reduce the environmental impacts at such facilities, the need for public participation may be less. However, EPA requests comment on whether it should nevertheless require a public participation process to ensure that neighbors of a facility are aware that it will be handling hazardous secondary materials sent from other companies, and have input about how the protective conditions required by the proposed exclusion will be met. Finally, EPA requests comment on whether companies should be required to keep records and/or report to EPA about the environmental benefits (e.g., reduced air emissions, energy savings, reduced transportation impacts) that are realized through their use of the re-manufacturing exclusion. EPA could then use this information to measure performance of the exclusion, enable public reporting of results, and facilitate information transfer in which other companies can learn how to achieve similar benefits. Additionally, we note that many companies already take advantage of reporting tools in order to track progress towards corporate sustainability goals and thus we believe that reporting would not pose an undue burden on facilities.
XIII. Request for Comment on Revisions to Other Recycling Exclusions and Exemptions
A. Background Information on Other Recycling Exclusions and Exemptions
As part of the 2008 DSW rulemaking, EPA developed a report, "An Assessment of Environmental Problems Associated with Recycling of Hazardous Secondary Materials" (environmental problems study), which analyzed 218 recycling damage cases. The goal of the environmental problems study was to identify and characterize environmental problems that have been attributed to hazardous secondary materials recycling activities. EPA then used the findings from this study to craft a number of conditions for the 2008 DSW final rule, which were specifically designed to target the major causes of damage and thus help define "discard" of hazardous secondary materials. These conditions, however, were applied only to the 2008 DSW exclusions. In developing today's proposal, we are interested in whether these conditions should be codified for the pre-2008 recycling exclusions and exemptions.
As part of the "Environmental Justice Analysis of the Definition of Solid Waste Rule" (EJ analysis), EPA reviewed and analyzed each damage case in the environmental problems study, including five additional damage cases that were identified after the 2008 DSW final rule was promulgated, and determined the regulatory provision that likely, or potentially, governed the management of the hazardous secondary materials. This analysis was based on the type of hazardous secondary material and the date of the damage case (related to the effective date of the regulatory provision), the results which can be found in the docket for this rulemaking.
From this analysis, we conclude that over half of the damage cases in this study were associated with hazardous secondary materials that were likely excluded or exempted from Subtitle C under an existing (pre-2008) regulatory provision. For example, 52 damage cases (23%) are associated with scrap metal that is likely excluded under 261.4(a)(13) and/or 261.6(a)(3)(ii). Drum reconditioning accounted for 23 damage cases (10%), in which the residuals are likely excluded under 40 CFR 261.7. Additionally, 35 damage cases (16%) were associated with recycling of batteries that are likely managed under 40 CFR 273.2 and/or 40 CFR part 266 subpart G. Based on these results, and given that many of the pre-2008 recycling exclusions specify limited or no conditions, we believe that these provisions may not be adequately enforceable in order to protect human health and the environment. Thus, we are requesting comment today on codifying specific conditions for these recycling exclusions.
EPA emphasizes that we are not reopening comment on any substantive provisions of the regulatory exclusions or exemptions. The inclusion of requirements for legitimacy, containment, and notification are strictly meant as means to better enforce the regulations. Moreover, EPA believes that the containment condition -- as with the legitimacy criteria -- is implicit in all of the regulations to which it would apply. If secondary material is not contained when it is being recycled, it is simply being discarded.
As part of the 2008 DSW final rulemaking, we reviewed the recycling studies and public comments in order to develop conditions that defined discard of hazardous secondary materials. Four conditions required for the generator-controlled exclusion in 40 CFR 261.4(a)(23) -- legitimate recycling, no speculative accumulation, containment, and notification -- constitute what we believe to be the minimum requirements necessary to define when recycled hazardous secondary materials are not discarded. Therefore, it seems prudent to review past exclusions and exemptions to ensure these regulatory provisions clearly require these newly codified standards.
Specifically, we are requesting comment on codifying the legitimate recycling standard in 40 CFR 260.43, additional recordkeeping requirements in the speculative accumulation standard in 40 CFR 261.1(c)(8), the contained standard in 40 CFR 260.10, and the notification provision in 40 CFR 260.42 for 32 regulatory provisions that exclude or exempt certain types of recycling from full Subtitle C regulation. A list of these 32 regulatory provisions can be found below. The new legitimacy standard would apply to all regulatory provisions except for 40 CFR 261.7, because it involves determining whether residues in containers are regulated, and no hazardous secondary material is being reclaimed. The contained standard and notification condition would apply to all provisions, although facilities operating under provisions that already contain specific regulatory requirements would have to continue meeting those requirements. The additional recordkeeping requirements for speculative accumulation would only apply to those regulatory provisions already subject to speculative accumulation (i.e., hazardous secondary material being used or reused per 261.2(e), characteristic by-products and sludges being reclaimed as noted in 40 CFR 261.2 Table 1, and the recycling-related exclusions in 40 CFR 261.4(a)), but would not apply to commercial chemical products being reclaimed (see 40 CFR 261.2 Table 1) or to recycling provisions that apply to recycling of solid or hazardous wastes (as noted in the chart below).

                                       #

                                   Citation
Description
260 & 261 Definition of Solid Waste
                                       1
260.30
Procedures for variances and non-waste determinations
                                       2
261.2 (e)
Use/Reuse
                                       3
261.2 Table 1
Characteristic sludges being reclaimed
                                       4
261.2 Table 1
Characteristic by-products being reclaimed
                                       5
261.2 Table 1
Commercial chemical products being reclaimed
261.4(a) Exclusions from the Definition of Solid Waste
6
261.4(a)(6)
Pulping Liquors
7
261.4(a)(7)
Spent Sulfuric Acid
8
261.4(a)(8)
Closed-Loop Recycling
9
261.4(a)(9)
Spent Wood Preservatives
10
261.4(a)(10)
Coke By-Product Wastes
11
261.4(a)(11)
Splash Condenser Dross Residue
12
261.4(a)(12)
Hazardous Oil-Bearing Secondary Materials and Recovered Oil from Petroleum Refining Operations
13
261.4(a)(13)
Processed Scrap Metal
14
261.4(a)(14)
Shredded Circuit Boards
15
261.4(a)(16)
Comparable Fuels
16
261.4(a)(17)
Mineral Processing Spent Materials
17
261.4(a)(18)
Petrochemical Recovered Oil
18
261.4(a)(19)
Spent Caustic Solutions from Petroleum Refining
19
261.4(a)(20)
Hazardous Secondary Materials Used to Make Zinc Fertilizers
20
261.4(a)(21)
Zinc Fertilizers Made from Recycled Hazardous Secondary Materials
21
261.4(a)(22)
Used Cathode Ray Tubes (CRTs)
261.4(b) Solid wastes which are not hazardous wastes
22
261.4(b)(12)
Spent Chlorofluorocarbon Refrigerants
23
261.4(b)(14)
Used Oil Distillation Bottoms used to manufacture asphalt products
261.6 Requirements for recyclable materials (hazardous wastes)
24
261.6(a)(3)(ii)
Scrap metal
25
261.6(a)(3)(iii)
Waste-derived fuels from refining processes
26
261.6(a)(3)(iv)
Unrefined waste-derived fuels and oils from petroleum refineries
27
261.6(c)(2)
Reclaimers that do not store
261.7 Residues of hazardous waste in empty containers
28
261.7
Residues of hazardous waste in empty containers
Part 266 Standards for the Management of Specific Hazardous Wastes
29
266 Subpart C
Recyclable Materials Used in a Manner Constituting Disposal
30
266 Subpart F
Materials Utilized for Precious Metal Recovery
31
266 Subpart G
Spent Lead-Acid Batteries Being Reclaimed
32
266 Subpart H
Hazardous Waste Burned in Boilers and Industrial Furnaces

Note that the possible changes discussed below would be in addition to the proposed application of the definition of legitimacy to all recycling, discussed in Section X of this preamble, and the request for comment on additional recordkeeping for speculative accumulation, discussed in Section IX.B.2 of this preamble.
B. Possible Changes to Other Exclusions and Exemptions
1. Contained Standard
Under the 2008 DSW final rule, hazardous secondary materials must be contained, whether they are stored in land-based units or non-land-based units. Generally, such material is considered "contained" if it is placed in a unit that controls the movement of the hazardous secondary material out of the unit and into the environment. Hazardous secondary materials that are released to the environment are not destined for recycling and are clearly discarded. Additionally, hazardous secondary materials that are not contained, and have not been immediately recovered, are not being managed as valuable commodities, which is relevant to determining whether the recycling process is legitimate. Lastly, requiring that hazardous secondary materials be contained ensures that the materials are managed in a manner protective of human health and the environment.
In the environmental problems study, mismanagement of hazardous secondary materials was determined to be the cause, or one of the causes, in 11 percent of the damage cases. Since many of these damage cases have been associated with a pre-2008 recycling provision, we believe it appropriate to close this gap by specifically requiring compliance with the contained standard in 40 CFR 260.10. Of course, facilities operating under provisions that already contain management requirements would have to continue meeting those requirements.
2. Notification
     Under the 2008 DSW final rule, facilities managing hazardous secondary materials are required to submit a notification prior to operating under the exclusions and by March 1 of each even-numbered year thereafter to the EPA Regional Administrator or State Director, if a state is authorized for the program, using the Site ID form, EPA Form 8700-12. The intent of this notification requirement is to provide basic information to regulatory authorities in order to enable adequate compliance monitoring and to ensure hazardous secondary materials are managed according to the exclusion and are not discarded. For example, in the notification, EPA requires facilities to include the quantity of hazardous secondary materials that will be managed under each exclusion and disclose whether certain types of hazardous secondary materials will be managed in land-based units. This information can be used to assist RCRA inspectors in determining which facilities may warrant greater oversight and provides a basis for setting enforcement priorities. Furthermore, requiring facilities to notify when they have stopped managing hazardous secondary materials allows states to follow up at those facilities and ensure that the hazardous secondary materials have not been discarded.
     Notification information is collected in EPA's RCRAInfo database, which is the national repository of all RCRA Subtitle C site identification information, whether collected by a state or EPA. EPA provides public access to this information through EPA's public website.
      The 2008 DSW final rule differed from other prior exclusions because it required facilities claiming the exclusion to notify EPA, or the authorized state, using an established EPA form (i.e., the Site ID form) and required facilities to re-notify every two years. Together, these requirements provide regulatory authorities with regularly updated data in a consistent format that enables them to collect, store, access, use, and publicly share information about these facilities. In contrast, many of the pre-2008 DSW recycling exclusions and exemptions do not contain any notification requirement and the few provisions that do require notification do not require a specific format for submitting the information or periodic updates. This results in facilities providing information in various forms, such as letters, which makes it difficult for regulatory authorities to share and use the information.
      Additionally, a one-time notification requirement has limited value. With a one-time notification approach, there is no assurance that the information collected in EPA's databases over time will accurately reflect facilities that are managing hazardous secondary materials according to the exclusions. Therefore, the Agency can imagine instances where extensive resources are required to be spent on `cleaning up' the data before regulatory authorities can use it to identify facilities who are currently managing hazardous secondary materials under the exclusions. With a one-time notification, we can also foresee problems where regulatory agencies spend time and resources monitoring compliance at facilities that have since stopped managing hazardous secondary materials at some point in the past. This inefficient use of resources would lower the overall effectiveness of regulators' ability to monitor compliance and could potentially increase the risk of environmental damage from abuse.
      In the time since the 2008 DSW final rule became effective, we have received more than 40 notifications from facilities managing hazardous secondary materials under the generator-controlled and/or transfer-based exclusions. This information has directly enabled regulatory authorities to monitor compliance and assist implementation via guidance materials and training. Additionally, notification has had the added benefit of identifying facilities that planned to manage hazardous secondary materials under the rule, but were, in fact, ineligible for the exclusions. (For example, we have received notifications from facilities located in a state that had not adopted the 2008 DSW final rule.) Notification in these instances allowed regulatory authorities to identify problems and to intervene early to prevent potential mismanagement.
       In the case of the many of the pre-2008 recycling exclusions and exemptions, we do not require notification (and even in those instances where we require notification, it is a one-time notification) and thus have no reliable or efficient way to receive information that enables regulatory authorities to adequately monitor these exclusions and exemptions. We believe this gap increases the risk of environmental damage stemming from improper management of hazardous secondary materials being recycled. We, therefore, are requesting comment on whether to require notification for those facilities operating under pre-2008 recycling exclusions and exemptions.
      Specifically, we are requesting comment on codifying notification under § 260.42 for facilities managing hazardous secondary materials under the pre-2008 recycling provisions. For those exclusions and exemptions that already require a one-time notification, notification under § 260.42 would replace, and not duplicate, the one-time notification requirement.
XIV. Effect of this Proposal on Other Programs
A. Effect on Permitted and Interim Status Facilities
      In the 2008 DSW final rule, EPA discussed how that rule would affect permitted and interim status facilities. Specifically, the Agency explained that permitted and interim status disposal facilities that manage hazardous wastes excluded under the 2008 DSW final rule are affected by the final rule in a number of ways, depending on the situation at the facility. (74 FR 64715-7)  If a permitted facility seeks to either terminate its operating permit or to remove units from its permit as a result of the 2008 DSW final rule, a facility must submit a Class I permit modification request with prior Agency approval; however, the obligation to address facility-wide corrective action remains in effect. Similarly, for facilities operating under interim status, the owner or operator retains responsibility for unaddressed corrective action obligations at the facility.
       However, if EPA finalizes today's  proposal to replace  the transfer-based exclusion with an alternative Subtitle C regulatory approach, EPA anticipates that the number of permitted and interim status facilities that are able to take advantage of the exclusion would be significantly reduced, because most of the permitted and interim status facilities affected by the 2008 final rule are excluded under the transfer-based exclusion. Furthermore, if EPA finalizes the re-manufacturing exclusion discussed in Section XII of this preamble, the Agency would not expect TSDFs to be affected, since that exclusion would be limited to manufacturers. Regardless of the ultimate scope of the exclusion, however, facilities with units covered by the exclusion should continue to refer to the preamble in the 2008 final rule (at FR 64715-17) for a discussion of the effect of the exclusion on permitted and interim status facilities.
      B. Effect on CERCLA
	In 1999, Congress enacted the Superfund Recycling Equity Act (SREA), explicitly defining those hazardous substance recycling activities that may be exempted from liability under CERCLA (CERCLA section 127). Today's proposal, if finalized, would not change the universe of recycling activities that could be exempted from CERCLA liability pursuant to CERCLA section 127. The proposal would only change the definition of solid waste for purposes of the RCRA Subtitle C requirements. The proposal also would not limit or otherwise affect EPA's ability to pursue potentially responsible persons under section 107 of CERCLA for releases or threatened releases of hazardous substances.
C. Effect on the Derived-From Rule
      In the 2008 DSW final rule (October 30, 2008, 73 FR 64692), EPA notes that the "derived from" rule articulated in 40 CFR 261.3(c)(2) does not apply to residuals from the reclamation of hazardous secondary materials excluded under the generator-controlled and transfer-based exclusions. These residuals are a new point of generation for the purposes of applying the hazardous waste determination requirements of 40 CFR 262.11. If the residuals exhibit a hazardous characteristic, or they themselves are a listed hazardous waste, they would be considered hazardous wastes (unless otherwise exempted) and would have to be managed accordingly. If they did not exhibit a hazardous characteristic, or were not themselves a listed hazardous waste, they would have to be managed in accordance with applicable state or federal requirements for non-hazardous wastes. EPA believes that in most cases, this would not be an issue because residuals from hazardous secondary material reclamation that may be of concern would either themselves be listed hazardous waste (i.e., still bottoms from the reclamation of solvents listed in 40 CFR 261.31) or would exhibit a characteristic (i.e., residuals from metals reclamation with hazardous metals concentrations above the toxicity characteristic in 40 CFR 261.24). EPA requests comment, including for any available data, on the hazardousness of reclamation residuals and whether the derived-from rule would need to be modified to regulate these residuals as hazardous waste.
D. Effect on Spent Petroleum Catalysts
	In the 2008 DSW final rule, EPA deferred the question of whether spent petroleum catalysts should be eligible for the exclusions pending further consideration of the pyrophoric properties of the spent petroleum catalysts (73 FR 64714). EPA noted that the Agency was planning to propose -- in a separate rulemaking from the 2008 DSW final rule -- an amendment to its hazardous waste regulations to conditionally exclude from the definition of solid waste spent hydrotreating and hydrorefining catalysts generated in the petroleum refining industry when these hazardous secondary materials are reclaimed. Spent hydrotreating and hydrorefining catalysts generated in the petroleum refining industry are routinely recycled by regenerating the catalyst so that it may be used again as a catalyst. When regeneration is no longer possible, these spent catalysts are either treated and disposed of as listed hazardous wastes or sent to RCRA-permitted reclamation facilities, where metals, such as vanadium, molybdenum, cobalt, and nickel are reclaimed from the spent catalysts. EPA originally added spent hydrotreating and hydrorefining catalysts (waste codes K171 and K172) to the list of RCRA hazardous wastes found in 40 CFR 261.31 on the basis of toxicity (i.e., these materials were shown to pose unacceptable risk to human health and the environment when mismanaged) (63 FR 42110, August 6, 1998). In addition, EPA based its decision to list these materials as hazardous due to the fact that these spent catalysts can at times exhibit pyrophoric properties (i.e., can ignite spontaneously in contact with air).
      It was largely because of these pyrophoric properties that the petroleum catalysts exhibit that EPA deferred the question of whether spent petroleum catalysts should be included in the 2008 DSW final rule exclusions. While spent petroleum catalysts can be a valuable source of recoverable metals, the risk of these hazardous secondary materials spontaneously igniting when in contact with air is not a property that most metal recyclers would be expected to address, and thus, present additional risks that are not presented by other types of metal-bearing hazardous secondary materials and are therefore may be most appropriately managed as hazardous waste when recycled.
      Under today's proposal, EPA is proposing to replace  the transfer-based exclusion with an alternative Subtitle C regulatory approach, and if finalized, would make the question of the eligibility of most types of spent catalyst recycling for the 2008 DSW final rule exclusions moot.  However, EPA is also proposing to add a regulatory definition of the "contained" standard which includes a requirement to address the risk of fires and explosions. This provision, if properly implemented, could address the pyrophoric properties of the spent petroleum catalysts (as well as other types of ignitibility or reactivity). EPA requests comment on whether this provision would adequately address the potential for discard of spent petroleum catalysts due to fire and explosions, thereby allowing EPA to remove the ineligibility of K171 and K172 from the DSW exclusion, and on other regulatory options, including adding more conditions (such as specific container standards) specific to pyrophoric materials to the exclusion.
XV. Implementation Issues with 2008 DSW Final Rule
	The 2008 DSW final rule became federally effective on December 29, 2008. The rule was effective immediately in states and territories for which EPA manages the RCRA program, specifically Alaska, Iowa, the U.S. Virgin Islands, the Northern Mariana Islands, American Samoa, and tribal lands. The rule does not go into effect in states that are authorized to manage their own RCRA programs unless and until the state adopts the rule. Currently, four states -- Idaho, Illinois, New Jersey, and Pennsylvania -- have adopted the rule. Within the states and territories where the 2008 DSW final rule is effective, more than 40 facilities have notified that they are managing hazardous secondary materials under the generator-controlled and/or the transfer-based exclusion.
	EPA believes that it is important to support effective implementation of the 2008 DSW final rule in order to ensure that hazardous secondary materials are properly managed and not discarded. Our goal is to reduce the risk of mismanagement of hazardous secondary materials that may occur from misunderstanding the regulations and incorrect implementation of the requirements and conditions. To this end, we have worked with the EPA Regions and states to provide training and guidance materials for regulators and the regulated community. Since the 2008 DSW final rule was codified, there have been number of questions from states and the regulated community regarding how the rule should be implemented and how it operates in special circumstances.
      Today, we are taking the opportunity to clarify these issues in the context of the 2008 DSW final rule. It should be noted that some of these implementation issues are specific to the transfer-based exclusion found at 40 CFR 261.4(a)(24), which EPA is proposing to  replace with alternative management standards under Subtitle C of RCRA. If EPA finalizes this change,  some of these issues would become moot.
A. Mixing Of Hazardous Secondary Materials Excluded Under 40 CFR 261.4(a)(24) With Similar Hazardous Wastes
One issue regards whether hazardous secondary materials excluded under 40 CFR 261.4(a)(24) can be mixed with other similar hazardous wastes within permitted units or exempt recycling units and how such mixing would affect the requirements of the generator and the reclaimer. Under § 261.4(a)(24), which covers hazardous secondary materials transferred off-site for reclamation, hazardous secondary material generators may send their materials to a facility that operates under a RCRA Part B permit or interim status standards. In this case, generators are not required to conduct reasonable efforts on the reclaimer as long as the RCRA Part B permit extends to the management of the hazardous secondary materials in question. We believe Part B permits or the interim status standards provide adequate assurance that the hazardous secondary materials will be well managed, specifically because the hazardous secondary materials are managed in units that are subject to stringent design and operating standards, the reclaimer must demonstrate financial assurance, and the materials are subject to the corrective action requirements in the event of environmental problems.
EPA understands that some reclaimers are receiving the same type of hazardous secondary materials for reclamation from multiple generators, with some amount excluded under § 261.4(a)(24) and some amount regulated as hazardous waste. The regulatory status of the material depends on how the generator who sent the materials chose to manage and transfer the materials off site. We also understand that reclaimers are interpreting § 261.4(a)(24) to mean that hazardous wastes and hazardous secondary materials must be stored in separate units and reclaimed independently of each other in order to preserve the regulatory status of the excluded material and the exclusion for the generators that transferred the hazardous secondary materials to the reclaimer.
It is clear in the 2008 DSW final rule that EPA allows hazardous secondary materials that are excluded from full Subtitle C regulation to be managed under a RCRA Part B permit or interim status standards. Managing hazardous secondary materials under a RCRA Part B permit affords further assurance that the hazardous secondary materials will be properly managed and reclaimed. Additionally, we believe that taking advantage of the existing recycling infrastructure both improves efficiency under the rule and increases opportunities for recycling.
Section 261.4(a)(24) states that the exclusion applies if the hazardous secondary materials are generated and transferred "for the purpose of reclamation." Thus, a reclaimer mixing excluded hazardous secondary materials with regulated hazardous wastes of the same type may only mix the materials for the purpose of reclamation (and not for the purpose of, for example, burning for energy recovery or disposal).
Prior to mixing, the reclaimer must manage the excluded hazardous secondary materials under § 261.4(a)(24) up to the point that they mix the excluded materials with similar materials that are regulated hazardous waste. The reclaimer must comply with all applicable conditions of § 261.4(a)(24) because it is receiving hazardous secondary materials transferred for the purpose of reclamation and excluded from the definition of solid waste. The reclaimer must therefore meet the applicable conditions of the § 261.4(a)(24) exclusion, including legitimate reclamation, recordkeeping, financial assurance, containment of hazardous secondary materials, notification, and the prohibition on speculative accumulation.
A reclaimer may only mix hazardous secondary materials excluded under § 261.4(a)(24) with regulated hazardous waste for the purpose of reclamation. This can be satisfied by mixing in units that are dedicated for reclamation, such as storage units that are connected to reclamation units by hard pipes or other conveyance; storage units that are solely used to store materials prior to the reclamation process; and recycling units. Additionally, a reclaimer is not mixing for the purpose of reclamation if the reclaimer first mixes the materials and then makes a determination whether the mixture should be reclaimed or sent for burning or disposal. This determination must be made prior to mixing the excluded hazardous secondary materials with regulated hazardous wastes.
After mixing the excluded hazardous secondary materials with regulated hazardous waste, the reclaimer must manage the entire mixture as hazardous waste for the purpose of reclamation. Excluded hazardous secondary materials cannot be mixed with regulated hazardous waste and still maintain the exclusion from the definition of solid waste. If excluded hazardous secondary materials are mixed with hazardous waste, the resulting mixture is a hazardous waste. This follows the general principle that RCRA applicability cannot be avoided by mixing a hazardous waste with another material. Therefore, the reclaimer must comply with the standard hazardous waste regulations applicable to hazardous waste managed by an off-site reclaimer (i.e., 40 CFR 261.6(c) and (d) or 40 CFR part 264 or 265). The mixture must be stored and managed in compliance with the hazardous waste regulations applicable to hazardous waste managed by an off-site reclaimer (i.e., 40 CFR 261.6(c) and (d) or 40 CFR part 264 or 265). If a reclaimer mixes hazardous secondary materials and other similar hazardous wastes in a recycling unit, the mixture would be considered hazardous waste, but the unit would be generally exempt from regulation under 40 CFR 261.6(c)(2).
Mixing by the reclaimer of excluded hazardous secondary materials received under 40 CFR 261.4(a)(24) with regulated hazardous wastes does not affect the requirements applicable to generators who shipped the hazardous secondary materials, provided that the hazardous secondary materials are transferred for the purpose of reclamation and the reclaimer complies with all applicable conditions of § 261.4(a)(24) prior to mixing. Excluded hazardous secondary materials mixed with regulated hazardous wastes of the same type become hazardous waste at the point of mixing and must be managed as such after that point. Therefore, generators transferring hazardous secondary materials under § 261.4(a)(24) to a reclaimer who mixes may manage the hazardous secondary materials under the § 261.4(a)(24) exclusion (e.g., longer storage times, shipping without a manifest) because the hazardous secondary materials have not yet been mixed with regulated hazardous wastes. (Of course, the generator and the reclaimer must meet all applicable conditions of § 261.4(a)(24) prior to mixing.)
B. Rejected Loads
A second issue regards shipments of hazardous secondary material transferred off-site by the generator for reclamation, but that are subsequently rejected by the reclaimer (otherwise known as "rejected loads"). Because 40 CFR 261.4(a)(24) states that the exclusion applies if the hazardous secondary material is generated and transferred "for the purpose of reclamation," EPA has received questions regarding how generators and reclaimers should handle rejected loads.
Although EPA did not explicitly address rejected loads in the preamble to the 2008 DSW final rule, we offered some guidance in our Response to Comments document for that action. Specifically, we state that if hazardous secondary materials transferred off-site for reclamation are subsequently rejected by the reclaimer, the generator can choose to send the hazardous secondary materials to another reclamation facility, provided the generator continues to comply with the conditions of the exclusion, including the speculative accumulation limits.
Prior to arranging for transport to an alternate reclamation facility, hazardous secondary material generators must make reasonable efforts to ensure the alternate reclamation facility intends to properly and legitimately reclaim the hazardous secondary material and must keep records of the off-site shipment and confirmation of its receipt as required under the 2008 DSW final rule. If a hazardous secondary material generator is unable to reclaim the hazardous secondary material in compliance with the speculative accumulation provision and the other terms of the exclusion, it must manage the materials as solid and hazardous waste according to the RCRA Subtitle C hazardous waste regulations. Furthermore, we believe the recordkeeping conditions (records of all off-site shipments and confirmations of receipt) are sufficient to ensure the hazardous secondary materials are properly managed if a rejected shipment must be returned to the hazardous secondary material generator or sent to an alternate reclamation facility.
In the event of a rejected load, generators and reclamation facilities should contact their regulatory authority in order to receive instructions on a case-by-case basis. Reclamation facilities should document their rejected loads, including information such as the EPA ID number, name, and address of the generator, the date the facility received the hazardous secondary material, a description and quantity of the material, the ultimate destination and disposition of the material, and an explanation of why the load was rejected. Additionally, we note that efforts to prevent rejected loads may help to avoid this issue altogether, for example, by sending test samples of the hazardous secondary material to a reclaimer to ensure that legitimate reclamation can be performed prior to sending the first shipment.
C. Interstate Transport
A third implementation issue regards the transport of excluded hazardous secondary materials from or to a state that has adopted the 2008 DSW final rule to or from a state that has not adopted the rule and what conditions would apply in each state. Specifically, if the originating state has adopted the 2008 DSW final rule, but the receiving (or transfer) state has not adopted the rule, the hazardous secondary materials (1) are subject to the hazardous waste requirements of the receiving state that has not adopted the rule upon reaching the border of that state (e.g., manifesting requirements); (2) must go to a RCRA-permitted facility (or other authorized designated facility), and, if stored, materials must be managed in permitted storage units (or when applicable under interim status requirements); and (3) cannot go to an unpermitted recycling facility which is not a designated facility in a state that has not adopted the rule because such a facility would not meet the conditions of the exclusion (e.g., financial assurance) and since the receiving state would not have adopted the exclusion.
If the originating state has not adopted the rule, but the receiving state has adopted the rule, the hazardous secondary materials (1) must be managed as regulated hazardous waste not only in the originating state, but also in the receiving state that has adopted the rule (e.g., may be sent to a permitted recycling facility, in the receiving state, which has notified that it is operating under the exclusion, but must then be stored only in permitted units at that facility) and (2) would not be eligible for the exclusion because the generator in the originating state that has not adopted the rule would not meet the conditions and requirements of the exclusion. In particular, the fact that the generator would not have notified EPA that it is sending the hazardous secondary material to an excluded reclamation facility, and would not have performed a "reasonable efforts" audit under 40 CFR 261.4(a)(24)(v)(B) to ensure that the hazardous secondary material will be safely and legitimately reclaimed could undermine the proper implementation of the 2008 DSW exclusion.
As noted in written comments submitted in response to the May 2009 public meeting Federal Register Notice, some states that do not plan on adopting the 2008 DSW final rule in full would like the generators in their states to be able to send their hazardous secondary materials to facilities without RCRA permits that are operating under the 40 CFR 261.4(a)(24) transfer-based exclusion in states that have adopted the rule . One possible solution for such a state might be to adopt the requirements applicable to generators in the 2008 DSW final rule (found in 40 CFR 261.4(a)(24)(i - v and vii)), in addition to the state's hazardous waste requirements, for those generators that wish to ship to reclaimers without RCRA permits whose operations are covered by the exclusion. In most cases, a generator following the generating state's hazardous waste requirements would also meet the 2008 DSW final rule requirements (i.e., no speculative accumulation, meeting DOT transport requirements, containment, records of shipments), since the state's RCRA program requirements (e.g., 90 and 180 day storage limits, manifesting requirements) would be equally or more stringent than the 2008 DSW final rule requirements), but the generator would also need to ensure that the hazardous secondary material meets the codified definition of legitimacy under 40 CFR 260.43, perform a "reasonable efforts" audit of the reclaimer and keep a copy of the audit for three years per 40 CFR 261.4(a)(24)(v)(B) and (C), and provide notification per 40 CFR 260.42. Thus, the hazardous secondary material would be covered both by the state hazardous waste program in the generating state that has not adopted the 2008 DSW final rule, and by the DSW transfer-based exclusion in the reclaiming state that has adopted the 2008 DSW final rule.
As discussed earlier, EPA has proposed to replace  the transfer-based exclusion with an alternative Subtitle C regulation, which would possibly render this issue moot. However, EPA is interested in and requests comments on these issues of how interstate transportation should be handled, particularly whether states are interested in such a solution, if the transfer-based exclusion is retained or not, and whether it is an issue for any of the other exclusions EPA is proposing to retain or is asking for comment on today. For example, should EPA allow for the shipment of hazardous secondary materials from a state which does not adopt the `under the control of the generator' exclusion to a state that has adopted that exclusion. If so, what additional requirements would the generating state have to adopt in order to allow for such shipments. Similarly, if a re-manufacturing exclusion is adopted, should EPA allow for the shipment of hazardous secondary materials from a state that does not adopt that exclusion to a state that adopts that exclusion. Again, what additional requirements would the generating state have to adopt in order to allow for such shipments.
D. Regulatory Status of Solvent Still Bottoms
	A fourth implementation issue is whether still bottoms from the reclamation of solvents can be burned for energy recovery without invalidating the 2008 DSW final rule exclusions, which specifically does not include burning for energy recovery. Still bottoms from the reclamation of the solvents listed in 40 CFR 261.31(a) as F001 - F005 are themselves listed hazardous waste and are not products of solvent reclamation. These still bottoms are a new point of generation, and they may be burned for energy recovery under the hazardous waste regulations without invalidating the exclusion.
XVI. State Authorization
A. Applicability of Rules in Authorized States
      	Under section 3006 of RCRA, EPA may authorize a qualified state to administer and enforce a hazardous waste program within the state in lieu of the federal program, and to issue and enforce permits in the state. A state may receive authorization by following the approval process described in 40 CFR 271.21 (see 40 CFR part 271 for the overall standards and requirements for authorization). EPA continues to have independent authority to bring enforcement actions under RCRA sections 3007, 3008, 3013, and 7003. An authorized state also continues to have independent authority to bring enforcement actions under state law.
		After a state receives initial authorization, new federal requirements promulgated under RCRA authority existing prior to the 1984 Hazardous and Solid Waste Amendments (HSWA) do not apply in that state until the state adopts and receives authorization for equivalent state requirements. In contrast, under RCRA section 3006(g) (42 U.S.C. 6926(g)), new federal requirements and prohibitions promulgated pursuant to HSWA provisions take effect in authorized states at the same time that they take effect in unauthorized states. As such, EPA carries out HSWA requirements and prohibitions in authorized states, including the issuance of new permits implementing those requirements, until EPA authorizes the state to do so.
Authorized states are required to modify their programs only when EPA enacts federal requirements that are more stringent or broader in scope than the existing federal requirements.  RCRA section 3009 allows the states to impose standards more stringent than those in the federal program (see also 40 FR 271.1(i)). Therefore, authorized states are not required to adopt federal regulations, both HSWA and non-HSWA, that are considered less stringent than previous federal regulations or that narrow the scope of the RCRA program.
B. Effect on State Authorization of Proposed Rule
		Today's notice proposes regulations that, if finalized, would not be promulgated under the authority of HSWA. Thus, the standards, if finalized, would be applicable on the effective date only in those states that do not have final authorization of their base RCRA programs. Moreover, authorized states are required to modify their programs only when EPA promulgates federal regulations that are more stringent or broader in scope than the authorized state regulations. For those changes that are less stringent, states are not required to modify their program. This is a result of section 3009 of RCRA, which allows states to impose more stringent regulations than the federal program.
		The revisions to the definition of solid waste being proposed today are more stringent than those promulgated under the 2008 DSW final rule, so those states which have adopted the 2008 DSW final rule would be required to modify their programs if these standards are finalized. However, when compared to the federal program that was in place when the 2008 DSW final rule was finalized, many of today's proposed revisions would be considered less stringent (e.g., the revised generator-controlled exclusion and the potential re-manufacturing exclusion) or are neither more nor less stringent (i.e., the alternative Subtitle C regulations for reclaimed hazardous recyclable materials). Therefore, authorized states that have not adopted the 2008 DSW final rule would not be required to modify their programs to adopt these standards, if finalized.
		However, the potential revisions to the other recycling exclusions and exemptions discussed in Section XIII of this preamble that EPA is currently requesting comment on, including codifying the legitimacy criteria for other exclusions as discussed in Section X of the preamble, would be more stringent than the current federal hazardous waste program, and all authorized states would be required to modify their programs to adopt equivalent, consistent and no less stringent requirements. Also, the proposed changes to the standards and criteria for variances from classification as a solid waste discussed in Section XI would be more stringent than the current federal hazardous waste program, and all authorized states which have adopted the underlying § 260.31 variance procedures would be required to modify their programs to adopt equivalent, consistent and no less stringent requirements.
XVII. Administrative Requirements for This Rulemaking
A. Executive Orders 12866 and 13563: Regulatory Planning and Review
   Under Executive Order 12866 (58 FR 51735, October 4, 1993), this action is a "significant regulatory action" because it is likely to "raise novel legal or policy issues" under section 3(f)(4) of Executive Order 12866. Accordingly, EPA submitted this action to the Office of Management and Budget (OMB) for review under Executive Orders 12866 and 13563 (76 FR 3821, January 21, 2011) and any changes made in response to OMB recommendations have been documented in the docket for this action.
   	In addition, EPA prepared an analysis of the potential costs and benefits associated with this action. This analysis is contained in EPA's Regulatory Impact Analysis (RIA) document titled "EPA's 2011 Proposed Revisions to Industrial Recycling Exclusions of the RCRA Definition of Solid Waste" which is available for public download from the docket for this action. The RIA is briefly summarized here.
   	The RIA evaluates the potential future impacts of the seven proposed revisions (i.e., Options 1 to 7 in the RIA) to the DSW regulatory exclusions for industrial hazardous secondary materials recycling. Six of the seven proposed revisions (i.e., RIA Options 1 thru 6) could affect EPA's 2008 DSW recycling exclusions (three exclusions) involving between 662 and 3,671 facilities currently recycling or disposing industrial hazardous wastes regulated under RCRA Subtitle C without exclusions, while three of today's proposed revisions (i.e., RIA Options 4, 5, and 7) in part or in whole could affect EPA's pre-2008 recycling exclusions involving an estimated 5,321 industrial facilities engaged in current RCRA-excluded recycling activities (32 exclusions).
   	The RIA presents a qualitative description of three categories of expected future environmental and economic benefits for the proposed revisions: (1) reduction in future environmental damage cases associated with industrial hazardous secondary materials recycling; (2) increased environmental compliance; and (3) reduced liability, less regulatory uncertainty, and lower legal and credit costs for recycling facilities.
   	In aggregate, the RIA estimates the future average annualized costs to industry to comply with the seven proposed revisions at between $7.2 million to $13.1 million per year under a lower-bound state adoption scenario, which results in 13% of recycling facilities implementing the revisions, and between $7.4 million to $47.5 million per year under an upper-bound state adoption scenario, which results in 74% of recycling facilities implementing the revisions (2011$ @7% discount rate). Based on the 13% implementation scenario, netting out the $7.2 million to $13.1 million average annual future costs for the seven proposed revisions, from the 2011-updated DSW regulatory cost savings baseline of $86.7 million per year (consisting of $79.3 million per year cost savings to industry associated with the pre-2008 DSW exclusions, plus $7.4 million cost savings per year for the 13% adoption rate of the 2008 DSW recycling exclusions), yields a future average annual net cost savings for all DSW exclusions of $73.6 million to $79.5 million per year (@7% "base case" discount rate over 50-years 2015 to 2064).
      These two alternative future implementation scenarios represent EPA's uncertainty about the future total count of state government RCRA-authorized programs which may ultimately adopt today's proposal when finalized. The lower-bound cost estimate represents an average annual future implementation rate by facilities based on the actual state government adoption rate associated with the 2008 DSW final rule. As of April 2011, four states (ID, IL, NJ, PA) have adopted the 2008 DSW final rule, five other states and territories (AK, AS, IA, NMI, VI) have adopted by EPA Regional Office administration of the RCRA regulatory program in those areas, and a total of 49 facilities have notified EPA they are managing hazardous secondary materials under the 2008 DSW final rule exclusions (divided over the 2.3 years between the date of today's action and the December 2008 effective date of the October 2008 DSW final rule, this 49 total facility count represents an average annual implementation rate of about 21 facilities per year). The upper-bound cost estimate represents hypothetical future non-adoption by all 12 authorized states that commented unfavorably on the transfer-based exclusion in the 2007 DSW proposed rule. The rule was assumed to go into effect in all other states and territories. Updated information about the identity of state governments which have adopted the 2008 DSW final rule, and the total count and identity of industrial facilities which have notified EPA they are managing hazardous secondary materials under the 2008 DSW final rule exclusions, is available at EPA's "DSW Final Rule: Resources for Implementation" Web page at http://www.epa.gov/waste/hazard/dsw/impresource.htm.
B. Paperwork Reduction Act (Information Collection Request)
      The information collection requirements in this proposed rule have been submitted for approval to the Office of Management and Budget (OMB) under the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. The Information Collection Request (ICR) document prepared by EPA has been assigned EPA ICR number 2310.02. Burden is defined at 5 CFR 1320.3(b).
      An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid OMB control number. The OMB control numbers for EPA's regulations in 40 CFR are listed in 40 CFR part 9.
      The information requirements proposed for this action help ensure that (1) entities operating under the regulatory exclusions included in today's proposal are held accountable to the applicable requirements and (2) state and EPA inspectors can verify compliance when needed.
      EPA estimates the total annual burden to respondents under the new paperwork requirements to be 84,590 hours and $4,456,294 in O&M costs ($10,277,107, including labor costs). Burden and costs continuing from the 2008 ICR include 1,046 hours and $187 O&M ($72,614, including labor costs), respectively. The total annual burden and O&M costs comparable to the 2008 ICR inventory would be 85,635 hours and $4,456,481, or 256,905 hours and $13,369,443 over three years. EPA estimates that the proposed 2011 revisions to the DSW final rule will also affect other related ICRs, increasing their annual burden and costs by 1,240 hours and $8,648 O&M ($79,392, including labor costs), respectively. The total annual respondent burden and cost as a result of the proposed rule, including impacts continuing from the 2008 ICR and impacts to associated ICRs, would be 86,876 hours and $4,465,129 O&M ($10,429,113, including labor costs), respectively.
In addition, EPA estimates the total annual burden to the government under the new paperwork requirements to be 43,863 hours and $1,707 in O&M costs ($2,385,917, including labor costs). Burden and costs continuing from the 2008 ICR include 1,107 hours and $27 in O&M ($60,225, including labor costs), respectively. The total annual burden and O&M costs comparable to the 2008 ICR inventory would be 44,971 hours and $1,734 in O&M costs, or 134,913 hours and $5,202 in O&M costs over three years. EPA estimates that the proposed 2011 revisions to the DSW rule will also affect other related ICRs, increasing their annual burden to the government by 12 hours ($481 labor costs), but no new O&M costs. The total annual burden and cost to the government as a result of the proposed rule, including impacts continuing from the 2008 ICR and impacts to associated ICRs, would be 44,982 hours and $1,734 O&M ($2,444,889, including labor costs), respectively.
To comment on the Agency's need for this information, the accuracy of the provided burden estimates, and any suggested methods for minimizing respondent burden, EPA has established a public docket for this rule, which includes this ICR, under Docket ID number EPA-HQ-RCRA-2010-0742. Submit any comments related to the ICR to EPA and OMB. See ADDRESSES section at the beginning of this notice for where to submit comments to EPA. Send comments to OMB at the Office of Information and Regulatory Affairs, Office of Management and Budget, 725 17th Street, NW, Washington, DC 20503, Attention: Desk Office for EPA. Since OMB is required to make a decision concerning the ICR between 30 and 60 days after [Insert date of publication in the Federal Register.], a comment to OMB is best assured of having its full effect if OMB receives it by [Insert date 30 days after publication in the Federal Register]. The final rule will respond to any OMB or public comments on the information collection requirements contained in this proposal.
C. Regulatory Flexibility Act
      The Regulatory Flexibility Act (RFA) generally requires an agency to prepare a regulatory flexibility analysis of any rule subject to notice and comment rulemaking requirements under the Administrative Procedure Act or any other statute unless the agency certifies that the rule will not have a significant economic impact on a substantial number of small entities. Small entities include small businesses, small organizations, and small governmental jurisdictions.
	For purpose of assessing the impacts of today's proposed rule on small entities, small entity is defined as (1) a small business as defined by the Small Business Administration's (SBA) regulations at 13 CFR 121.201; (2) a small governmental jurisdiction that is a government of a city, county, town, school district or special district with a population of less than 50,000; and (3) a small organization that is any not-for-profit enterprise which is independently owned and operated and is not dominant in its field.
      After considering the economic impacts of today's proposed rule on small entities, I certify that this action will not have a significant economic impact on a substantial number of small entities.
      As presented in EPA's RIA for today's proposal, the types of small entities which could potentially be directly regulated are in a wide range of up to 620 industries. For purposes of analysis, the RIA evaluated potential small business impacts in 27 NAICS code industries with the largest number of facilities potentially affected. This RIA identified the 27 industries by first looking at the count of facilities by 6-digit NAICS codes for the current population of facilities recovering hazardous secondary materials, including (1) 323110 Commercial Lithographic Printing; (2) 324110 Petroleum Refineries; (3) 325188 All Other Basic Inorganic Chemical Manufacturing; (4) 325199 All Other Basic Organic Chemical Manufacturing; (5) 325211 Plastics Material and Resin Manufacturing; (6) 325412 Pharmaceutical Preparation Manufacturing; (7) 325510 Paint and Coating Manufacturing; (8) 325998 All Other Miscellaneous Chemical Product and Preparation Mfg; (9) 326199 All Other Plastics Product Manufacturing; (10) 331111 Iron and Steel Mills; (11) 331492 Secondary Smelting, Refining & Alloying of Nonferrous Metal (except Copper, Aluminum); (12) 332312 Fabricated Structural Metal Manufacturing; (13) 332812 Metal Coating, Engraving (except Jewelry and Silverware), and Allied Services to Manufacturers; (14) 332813 Electroplating, Plating, Polishing, Anodizing and Coloring; (15) 332999 All Other Miscellaneous Fabricated Metal Product Manufacturing; (16) 333415 Air Conditioning, Warm Air Heating Equipment, and Commercial and Industrial Refrigerator Equipment Manufacturing, (17) 334412 Bare Printed Circuit Board Manufacturing; (18) 334413 Semiconductor and Related Device Manufacturing; (19) Printed Circuit Assembly, (20) 336399 All Other Motor Vehicle Parts Manufacturing; (21) 336412 Bare Printed Circuit Board Manufacturing; (22) 336413 Other Aircraft Part and Auxiliary Equipment Manufacturing; (23) 541710 Research & Development in the Physical, Engineering, and Life Sciences; (24) 562211 Hazardous Waste Treatment and Disposal; (25) 611310 Colleges, Universities and Professional Schools; (26) 622110 General Medical and Surgical Hospitals; (27) 928110 National Security.
      The estimated potential average annual impact (i.e., added regulatory cost) on small entities is estimated to be significantly less than 1% of annual sales for all affected small entities. The RIA estimates that under the 13% base-case adoption scenario 910 small entities could be affected by today's proposal (if promulgated) out of a total 6,497 affected small plus non-small entities (i.e., 14%), and 1,274 small entities could be affected out of a total 9,102 potentially affected small plus non-small entities (i.e., 14%) under the 74% upper-bound adoption scenario. These counts include facilities currently operating under the pre-2008 DSW recycling exclusions (32 exclusions), plus additional current RCRA hazardous waste recyclers which in the future could potentially operate under the 2008 DSW recycling exclusions (3 exclusions). However, these facility count estimates are based on analyses presented in EPA's RIA involving EPA's Toxic Release Inventory (TRI) database for the pre-2008 exclusions, and EPA's RCRA Hazardous Waste Biennial Report database for potential adoption of the 2008 DSW exclusions, and both databases have limitations which may make these facility count estimates inaccurate. Specifically, some of the facilities identified using the TRI database may be RCRA conditionally-exempt small quantity generators (CESQGs) which will not be affected by today's proposal (and thus may contribute to over-estimating in the RIA both small and total small plus non-small entities affected under the pre-2008 exclusions), and the BR database does not include comprehensive data on RCRA small quantity generators (SQGs) which may contribute to under-estimating in the RIA both small and total small plus non-small entities.
	Based on the RIA's small entity "sales test" impact evaluation method, the highest estimated potential impact on any single small entity as a percentage of annual business revenues (i.e., the "sales test" method) is estimated at 0.41%. The total number of small businesses impacted at this level is estimated at 21 small entities under the 13% base-case adoption scenario, and 30 small entities under the 74% adoption scenario, which represents 2.3% to 2.4%, respectively, of the 910 (13% scenario) to 1,274 (74% scenario) small entities which could be impacted by today's proposal.
	Although this proposed rule will not have a significant economic impact on a substantial number of small entities, we continue to be interested in the potential impacts of the proposed rule on small entities and welcome comments on issues related to such impacts and suggestions on how to reduce such impacts.
D. Unfunded Mandates Reform Act
	This rule does not contain a federal mandate that may result in expenditures of $100 million or more for state, local, and tribal governments, in the aggregate, or the private sector in any one year. Potential future annual added direct costs to state, local, and tribal governments could include 11 administrative activities associated with a number of the options, including (1) receive, review and file biennial notifications (RIA Options 2, 4, 6, & 7); (2) receive, review and file reclamation plan (RIA Option 2); (3) receive, Review and approve emergency plans (RIA Option 2); (4) receive, review and file notification of compliance regarded affected release area (RIA Option 2); (5) review RCRA permit applications and enter into database (RIA Option 2); (6) evaluate legitimacy petitions (RIA Option 4); (7) evaluate legitimacy documentation (RIA Options 4); (8) receive, review, and file re-application for variance or non-waste determination (RIA Option 5); (9) EPA provides online public access to a list (including documentation) of facilities receiving non-waste determinations (RIA Option 5); (10) petition process for re-manufacturing exclusion (RIA Option 6); and (11) other state paperwork requirements under existing paperwork requirements covering 2008 revisions to the RCRA definition of solid waste, RCRA hazardous waste manifest system requirements, hazardous waste generator standards, hazardous waste specific unit requirements and special waste processes and types, and air emission standards for tanks, surface impoundments and containers.
      See the RIA for a complete description of the options and the various administrative activities. The RIA estimates that the state government share of future average annualized direct costs for the above seven implementation requirements ranges between $8.5 million and $9.1 million per year. No impacts are expected for local or tribal governments. Because these direct costs are well below the $100 million annual direct cost threshold, this proposed rule is not subject to the requirements of sections 202 or 205 of UMRA. This rule is also not subject to the requirements of section 203 of UMRA because it contains no regulatory requirements that might significantly or uniquely affect small governments.
E. Executive Order 13132: Federalism
      This action does not have federalism implications. It will not have substantial direct effects on the states, on the relationship between the national government and the states, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132. The RIA for today's action presents an evaluation of whether the proposed regulatory revisions could "impose substantial direct compliance costs" on state or local governments. For purpose of quantitative analysis, the RIA applied a numerical method known as the "$25 million test." The analysis evaluated whether annualized direct compliance costs to state or local governments potentially exceed $25 million per year. Potential future annual added direct costs to state or local governments could include 11 administrative activities associated with a number of the options, including (1) receive, review and file biennial notifications (RIA Options 2, 4, 6, & 7); (2) receive, review and file reclamation plan (RIA Option 2); (3) receive, Review and approve emergency plans (RIA Option 2); (4) receive, review and file notification of compliance regarded affected release area (RIA Option 2); (5) review RCRA permit applications and enter into database (RIA Option 2); (6) evaluate legitimacy petitions (RIA Option 4); (7) evaluate legitimacy documentation (RIA Options 4); (8) receive, review, and file re-application for variance or non-waste determination (RIA Option 5); (9) EPA provides online public access to a list (including documentation) of facilities receiving non-waste determinations (RIA Option 5); (10) petition process for re-manufacturing exclusion (RIA Option 6); and (11) other state paperwork requirements under existing paperwork requirements covering 2008 revisions to the RCRA definition of solid waste, RCRA hazardous waste manifest system requirements, hazardous waste generator standards, hazardous waste specific unit requirements and special waste processes and types, and air emission standards for tanks, surface impoundment and containers. See the RIA for a complete description of the Options and the various administrative activities. The RIA estimates that the maximum state government share of future average annualized direct costs for these implementation tasks ranges between $8.5 million and $9.1 million per year. No impacts are expected for local governments. Because these direct costs are well below the $25 million test threshold, we conclude that Executive Order 13132 does not apply to this action. However, in the spirit of Executive Order 13132, and consistent with EPA policy to promote communications between EPA and state and local governments, EPA specifically solicits comment on this proposed action from state and local officials.

F. Executive Order 13175: Consultation and Coordination with Indian Tribal Governments
	Subject to the Executive Order 13175 (65 FR 67249, November 9, 2000), EPA may not issue a regulation that has tribal implications, that imposes substantial direct compliance costs, and that is not required by statute, unless the Federal government provides the funds necessary to pay the direct compliance costs incurred by tribal governments, or EPA consults with tribal officials early in the process of developing the proposed regulation and develops a tribal summary impact statement.