UPDATE: The agreement was approved by U.S. District Court Judge Jeffrey White on March 13 and will be published in the Federal Register.
OAKLAND, Calif. - An agreement has been reached in the case of Sierra Club v. Pruitt that sets new Formaldehyde Rule "manufactured by" dates for producers and fabricators of composite wood panels to June 1, 2018, for CARB Phase 2 or TSCA Title VI compliant materials, with only TSCA Title VI compliant and labeled products allowable after March 22, 2019.
The U.S. District Court for the Northern District of California/Oakland Division is expected to accept the agreement, reached Friday night, March 9, by the parties in the case of the Sierra Club and A Community Voice-Louisiana v. Scott Pruitt in his official capacity as Administrator of the United States Environmental Protection Agency.
"CPA and its members are pleased with the terms of the stipulated agreement, which, if accepted by the Court, will ensure that North American composite panel manufacturers and their customers can manage inventories and comply with TSCA Title VI in a timely manner. The settlement represents a remarkable example of cooperation between environmental groups, industry, and the government, which has characterized the efforts on this issue since 2008," said Jackson Morrill, president of the Composite Panel Association.
"This has been a collaborative effort between Sierra Club, EPA, KCMA and a number of other trade associations," said Betsy Natz, CEO of the Kitchen Cabinet Manufacturers Association (KCMA). "Our collective associations were able to provide EPA and the Sierra Club with critical information on the practical implications of setting a compliance date that would be unworkable to our respective industries."
She added, "We were pleased that Sierra Club recognized the difficulty in early labeling and proposed adding a provision that would allow companies to continue to sell products compliant with CARB Phase 2 until March 22, 2019. This was in recognition that the EPA only last month finalized the Correlation Rule allowing use of the common small chamber test method for confirming compliance with the emissions limits in the EPA rule."
The joint proposed stipulation document "provides fair notice to the affected industries and avoids treating any composite wood products manufactured (in the United States) or imported (into the United States) between December 12, 2017 and June 1, 2018 as being non-compliant." Also, the sell-through provision is preserved and covers panels and finished goods manufactured prior to the June 1, 2018 manufactured-by date.
It was on Oct. 31, 2017, that Sierra Club filed a lawsuit claiming EPA acted "arbitrarily, capriciously" and without authority when it granted panel producers a one-year extension for compliance to TSCA Title VI, also known as the Formaldehyde Emission Standards for Composite Wood Products. The original compliance date was Dec. 12, 2017.
On Feb. 16, U.S. District Court Judge Jeffrey White vacated the rule that had extended the TSCA Title VI compliance date to Dec. 12, 2018, agreeing with the plaintiff that the "Delay Rule is beyond the scope of the EPA’s authority and is not in accordance with the Formaldehyde Act." The judge also rejected EPA’s waiver argument that the plaintiffs failed to exhaust their administrative remedies by not commenting on the proposed extension to the compliance deadline, noting "the Court finds the record replete with comments from other stakeholders who objected to the further extension of the compliance deadlines."
The EPA estimates the formaldehyde regulations apply to approximately 1 million regulated entities, including those involved in the cabinet, furniture, store fixture, flooring, windows and doors industries. In addition to the CPA and KCMA, other trade associations involved in the effort include the American Home Furnishings Alliance (AHFA), International Wood Products Association (IWPA) and the National Association of Home Builders (NAHB).