Risk Evaluation Rule Tees Up Litigation on How EPA Considers Chemical Use in Commerce

The US Environmental Protection Agency (EPA) on May 3, 2024 released its final amendments to its Procedures for Chemical Risk Evaluation (or the Risk Evaluation Rule), the procedural framework for evaluating the health and environmental risks of chemical substances under the Toxic Substances Control Act (TSCA). The newly amended rule codifies certain policy considerations expanding the scope of risk evaluations, while leaving EPA broad discretion in how it interprets and implements the science.

As required by the 2016 TSCA amendments, EPA promulgated a 2017 version of the Risk Evaluation Rule that established the procedures EPA uses for collecting, assessing, and integrating available scientific information on the hazards and exposures of active chemicals in commerce. At the end of 2020 and beginning of 2021, EPA finalized the first 10 risk evaluations under the 2016 TSCA amendments and the 2017 implementing regulations. But in June 2021, shortly after President Joseph Biden took office, EPA withdrew the risk evaluations completed by the previous administration and announced a new path forward based on important policy changes. The May 3 version of the Risk Evaluation Rule codifies these new policy initiatives.

Legally Significant Policy Changes

These policy changes are legally significant for two reasons: (1) they open the door for a single judicial decision that resolves the broader implementation policy debate in a vacuum (i.e., on the regulation’s face instead of as applied in context) and (2) they endow EPA with vast discretion regarding the consideration of important scientific and technical information without objective criteria to guide that discretion to ensure that EPA’s decisions are not arbitrary.

Finding the right policy and regulatory balance for continuing to advance chemical innovation while protecting the public health has fueled controversy over EPA’s new “Existing Chemicals” TSCA program from the start. The problem is that an understanding of health outcomes from individual chemical exposures may not always match real-world exposures to multiple pollutants at different concentrations among susceptible populations. Likely in anticipation of this controversy, there were two key bipartisan compromises built into the 2016 TSCA amendments. The first was the use of the term “conditions of use,” and the second was establishing mandatory scientific standards for making science-based decisions under the statute. The May 3 amendments to the Risk Evaluation Rule implicate both congressional compromises.

Expanding the Scope of TSCA Risk Evaluations

In 2016, US Congress added the statutory phrase “conditions of use” into TSCA to assure that EPA had the ability to focus on the circumstances of exposure to a chemical substance that raise the greatest potential for risk. [1] The 2017 Risk Evaluation Rule codified a procedure that allowed EPA to exercise discretion in making sound scoping decisions as to which conditions of use it will address in the risk evaluation, and to issue individual risk determinations based on any one condition of use or under any combination of uses. In 2017, EPA believed that the reasonable exercise of this discretion would allow it to focus its analytical efforts on conditions of use that raise the greatest potential for risk within TSCA’s strict deadlines.

Contrast the 2024 Risk Evaluation Rule that now explicitly requires that EPA assess all conditions of use together in a single risk determination for the chemical substance being evaluated. This amendment sets the stage for the long-awaited challenges to EPA’s controversial interpretation of Congress’s instruction to determine whether a chemical substance presents an unreasonable risk under its conditions of use.

Narrowing TSCA’s Scientific Integrity Protections

In 2016, Congress was also concerned with eliminating the possibility of predetermined political outcomes through the manipulation of scientific information and underlying data. To promote fair-and-objective decision making based on open-and-transparent science, Congress added certain scientific standard provisions to TSCA. [2] The 2017 Risk Evaluation Rule codified definitions for key scientific terms, including ‘‘best available science’’ and ‘‘weight of the scientific evidence,’’ among others, to instill confidence, increase transparency, and provide the public with assurance that EPA would meet those congressional objectives. However, the 2024 Risk Evaluation Rule eliminates the scientific definitions and codifies other changes that appear to weaken the scientific integrity protections built into the 2016 TSCA amendments.

Looking Ahead

While there is no doubt that the 2024 Risk Evaluation Rule will face judicial review, it should not be overlooked as maybe the most significant regulatory action since the 2016 statutory amendments because it will finally and definitively resolve the implementation policy debates raised by the 2017 version of the Risk Evaluation Rule. Indeed, the timing of the amended Risk Evaluation Rule may not be a coincidence.

In March 2024, EPA released the first risk management rule since the 2016 TSCA amendments, banning ongoing use of chrysotile asbestos. In April 2024, EPA finalized prohibitions and workplace protections for methylene chloride. Additionally, final risk management rules for perchloroethylene (PCE), trichloroethylene (TCE), carbon tetrachloride, and N-methylpyrrolidone (NMP) are all expected to be released this year. While the industry is focused on the technical review of the science underlying these rules, it must not lose sight of the statutory interpretation questions at the heart of the underlying policy approaches to the risk evaluations that support these risk management rules.

The timing of a challenge to the amended Risk Evaluation Rule will also likely align with the US Supreme Court’s reconsideration of a key administrative law doctrine from Chevron v. NRDC [3] . Chevron has required courts to defer to agencies’ interpretations of statutes that confer them authority if that statute leaves a gap between its goals and the specifics necessary for implementation. The current challenges to Chevron in Loper Bright Enterprises v. Raimondo [4] and Relentless Inc. v. Department of Commerce [5] comes on the heels of recent Court decisions recognizing the “major questions” doctrine. Should the Court limit the scope of Chevron deference, these decisions together would send a strong signal that the courts are required to serve as a check on expansive interpretations of agency authority.

While Chevron and the major questions doctrine focus on the limits to EPA’s interpretations of statutes, they do not directly address the deference owed to an agency’s interpretation of its own regulations. Furthermore, highly technical and complex scientific assessments, like the TSCA risk evaluations that underlie the ultimate risk management rules, are the types of decisions courts have historically hesitated to interfere with. Thus, there may be significant strategic value in challenging EPA’s procedural and policy interpretations of TSCA through contesting the amended Risk Evaluation Rule on the heels of Supreme Court’s decision to shift power away from EPA.

Any person or corporation may file a petition for review of the amended Risk Evaluation Rule by July 2, 2024. Under TSCA, the petition must be filed directly in a federal court of appeals, specifically the DC Circuit or the circuit where the petitioner resides or conducts its principal business operations.