Chemical Plant Security Legislation: Where We’ve Been, Where We Are, Where We’re Going
Beveridge & Diamond, P.C., April 29, 2009
The Congressional priorities in 2009 include climate change, health care, the economy -- and chemical plant security legislation. While the latter does not usually rank among the top issues for public debate, the fact is that the current legislation authorizing the Department of Homeland Security (“DHS”) to regulate chemical plant security[1] expires in October. Either Congress acts to extend or expand that authority before then, or else the legal authority for the current DHS Chemical Facility Anti-Terrorism Standards (“CFATS”) program will be in legal limbo.
The skirmishing has already begun, with the primary issue being whether to authorize DHS to mandate evaluation or adoption of “inherently safer technology” (“IST”) to reduce the potential harm that a security breach at a chemical facility could cause.
To understand where chemical plant security legislation is likely to go in the coming months, it may be helpful to review how we got to where we are today. This memorandum explains the IST controversy, traces the history of the various bills introduced in the last few years, and sets the stage for this year’s battle.
1. What is “Inherently Safer Technology”?
The term “inherently safer technology” refers to technological and procedural steps to reduce the potential for a hazardous chemical release, as opposed to security measures to deter sabotage of existing processes. The National Research Council explained in a 2006 publication:
The most desirable solution to preventing chemical releases is to reduce or eliminate the hazard where possible, not to control it. This can be achieved by modifying processes where possible to minimize the amount of hazardous material used, lower the temperatures and pressures required, replace a hazardous substance with a less hazardous substitute, or minimize the complexity of a chemical process.
It recommended that “DHS should support research and development to foster cost-effective, inherently safer chemistries and chemical processes.”[2] An often-cited example is substitution of sodium hypochlorite for gaseous chlorine at water treatment plants.
Industry has long supported IST as a design concept for construction of new or modified chemical plants.[3] The main conflict arises with respect to whether to mandate the retrofit of existing facilities to meet IST recommendations with which the facility owners may not agree. Trade groups such as the Society of Chemical Manufacturers and Affiliates (“SOCMA”, formerly the Synthetic Organic Chemical Manufacturers Association) have argued that while the consideration of safer alternatives is a “noble goal,” proponents of mandatory IST rules may overlook the extent to which chemical manufacturers already seek to optimize the safety of their products and operations.[4] Under this view, the industry’s existing incentives to produce safe, useful products and avoid liability for any resulting hazards naturally place the responsibility for risk management on those who have the most relevant technical expertise. Thus, the potential danger of mandatory IST rules is that they would reallocate the risks of chemical manufacturing having decoupled both expertise and liability from these crucial decisions.[5]
On the other hand, some NGOs and others argue that “The only certain way to protect our communities is to remove the possibility of a toxic gas release by converting facilities to safer, more secure alternative technologies.”[6]
The advantages and disadvantages of IST were summarized in a 2006 report by the Congressional Research Service:
Two potential advantages of this approach are that consequences of terrorism may be reduced even if a terrorist succeeds in his mission, and that risks associated with accidental releases of chemicals also are likely to be reduced . . . .
The key disadvantages of this “safer” facility strategy are potentially higher production and research and development costs, delays in achieving security while new processes are put into place, and, at least in some cases, lack of feasibility. However, advocates argue that use of safer technologies may reduce production costs by reducing regulatory burdens, insurance premiums, transportation costs, and waste disposal costs. Another potential disadvantage of the strategy is that some “safer” tactics may simply spread a risk around, shift the risk to other locations or populations, or substitute one risk for another. For example, in replacing an acutely toxic chemical (that produces relatively severe health effects after a short exposure) with a less acutely toxic chemical, one might increase chronic risks (due to low-level, long-term exposures) or environmental risks (e.g., due to the chemical’s persistence).[7]
2. Where We’ve Been
Chemical plant security legislation was introduced shortly after the events of September 11, 2001, in the 107th Congress. Within two months, on October 31, 2001, Senator Jon Corzine of New Jersey introduced S. 1602, the “Chemical Security Act of 2001.” [8] The Corzine bill proposed a program under which the Environmental Protection Agency (“EPA”) would list facilities that posed a significant risk of exposing the public to a release of hazardous chemicals.[9] The bill would have required that the listed facilities assess the vulnerabilities associated with their industrial processes and respond with appropriate measures, including IST.[10] The following summer, two of New Jersey’s representatives, Democrat Frank Pallone and Republican Marge Roukema, co-sponsored a companion bill in the House, H.R. 5300, substantially the same as S. 1602, but with some additional programmatic details.[11] The Corzine bill was reported out of the Environment and Public Works Committee, whereas its House analogue, having been introduced late in the session, remained in the Energy and Commerce Committee.
In the 108th Congress, after the New Jersey delegation introduced essentially identical bills,[12] Senator James Inhofe of Oklahoma responded with S. 994, the “Chemical Facilities Security Act of 2003.”[13] The Inhofe bill covered many of the same bases, but placed greater emphasis on economic feasibility as a factor in the determination of appropriate security measures and, most importantly, lacked the IST provisions. The Inhofe bill also placed regulatory authority entirely within DHS, whereas the Corzine bills had given the EPA the lead role and added a consultative role for DHS. The difference in agency assignments is significant both politically and substantively, as it represents a choice between regulating hazardous chemicals as a general threat to the environment and public health and safety (under EPA), as opposed to treating the potential for malicious releases more narrowly as a security question (under DHS). This distinction also corresponds to the difference of opinions over the importance of IST: those who oppose IST find that any method that would effectively prevent terrorist sabotage is sufficient security, whereas IST proponents attempt to address a broad spectrum of environmental, health and safety issues. The controversy over IST prevented either bill from gaining enough votes to pass, and the session ended without a federal chemical plant security program.
The deadlock over IST persisted into the 109th Congress, and ultimately motivated legislators to try a provisional approach. Instead of a stand-alone bill that elaborates the details of a comprehensive program, the legislative compromise was to insert a short section into the annual DHS appropriations bill to convey regulatory authority to DHS on a temporary basis, expiring “three years after the date of enactment,” October 4, 2006.[14] The result, Section 550 of the DHS Appropriations Act, 2007, most closely resembles the Inhofe bill, but covers the subject matter in far less detail, in effect giving DHS wide latitude to interpret its mandate and define the contours of the program. Section 550 directs DHS to establish “risk-based performance standards” and require facilities first to conduct security vulnerability assessments (“SVAs”) and then to propose and implement site security plans (“SSPs”).[15] While Section 550 gives DHS authority to approve or reject a facility’s SSP, the statute expressly prohibits DHS from requiring any particular security measure in a particular situation.[16] Section 550 gives DHS discretion to determine which facilities present sufficiently high security risks to be subject to its requirements.[17] Institutionally, Section 550 conveys its authority exclusively to DHS, with no instructions to involve EPA in any decisions.
3. Where We Are
The status quo changed with the DHS implementation of its authority under Section 550 to regulate chemical plant security. DHS established the resulting CFATS program through regulations promulgated in 2007.[18] The application of CFATS requirements begins with the determination that a facility uses or plans to use any of a long list of “chemicals of interest” (“COIs”) at or above particular screening threshold quantities (“STQs”).[19] Any facility that meets the STQ of a given COI is required to submit a “Top Screen” report, a preliminary risk assessment that DHS uses to decide which facilities present a sufficient security risk to be subject to the SVA and SSP requirements.[20] For facilities that are required to submit and implement an SSP, the performance standards that they must meet all relate to deterring or repelling potential attacks, addressing concerns such as securing the facility’s perimeter, restricting access, and monitoring.[21] The current CFATS regulations do not contemplate IST.
At the time of the enactment of Section 550, many chemical facilities had adopted voluntary security measures Responsible Care® Security Code of Management Practices of the American Chemistry Council (“ACC”).[22] Now, however, nearly three years after enactment of Section 550, there is a mandatory chemical plant security system in place. Some 35,000 facilities have completed a Top Screen assessment, of which about 6,500 have been preliminarily “tiered in” as high-risk facilities and been required to complete an SVA.[23] Subsequent legislation must deal with the existing administrative apparatus and the extensive investment by regulated facilities to comply with the existing requirements.
Another significant change since 2006 is the election of a Democratic President and Vice President, both of whom supported an IST provision when in the Senate. The more heavily Democratic Congress than in 2006 will also figure in the outcome.
4. Where We’re Going
With the three-year Section 550 authority due to expire in October 2009, the legislative battle to shape the replacement legislation began in the 110th Congress and continues into the 111th. The most discussed options are either to extend or permanently authorize the CFATS program more or less as it stands, or to enhance it with additional requirements, particularly the IST provisions generally favored by environmental and labor advocates.
In recent Congressional sessions, the chemical plant security debate has centered on three proposals that present alternatives to the status quo. We are likely to see variations of these proposals in the 111th Congress.
- S. 2486, the “Chemical Security and Safety Act of 2006,” [24] was the leading alternative to the Inhofe bill, and thus to Section 550. It would have required each covered facility to establish “safety and security committees” comprised of at least 50% non-management employees of the facility,[25] and emphasized a general policy of promoting the adoption of IST.[26] Both then-Senators Barack Obama and Joe Biden were original co-sponsors of S. 2486.
- H.R. 5533, the “Chemical Facilities Security Act of 2008,” would have reauthorized Section 550, and therefore CFATS, with little modification, except that it would eliminate federal preemption of state or local regulation.[27] Preemption is a particular concern in New Jersey, which had established a program of chemical facility security prior to the DHS program. Section 550 includes an ambiguous provision that effectively gives DHS discretion to preempt state and local programs that cover the same issues.[28] The CFATS regulations currently contain a provision that permits DHS to preempt any State or local law that “conflicts with, hinders, poses an obstacle to or frustrates the purposes of” CFATS; in effect, blanket preemption authority.[29]
- H.R. 5577, the “Chemical Facility Anti-Terrorism Act of 2008,”[30] would have nominally reauthorized CFATS, but would have replaced Section 550 with a far more comprehensive set of statutory commands, including what amounts to the imposition of an IST requirement. While the traditional IST language appears nowhere in this bill, it nonetheless incorporates various IST measures under the substitute phrase “methods to reduce the consequences of a terrorist attack.”[31] All covered facilities would be required to perform assessments of such methods and report on which methods they have assessed, as well as the potential reductions in “death, injury, or serious adverse effects to human health [that would] result[] from a terrorist release.”[32] Based on these assessments, DHS would be authorized to require facilities to implement methods that would significantly reduce these risks, although DHS would also be required to factor practical and economic feasibility into its decisions.[33] The adoption of indicated methods would also enable DHS to reassign a facility to a lower-risk category, relieving much of the regulatory burden on the facility.[34] Like H.R. 5533, this bill also would have eliminated the preemptive effect of the CFATS program.[35]
None of the leading proposals from past years has yet been reintroduced in the 111th Congress. Reports suggest that the negotiation process, behind closed doors, is underway and that the House Homeland Security Committee expects to present a proposal before Memorial Day.[36] A draft CFATS reauthorization bill currently under the Committee’s consideration reportedly contains IST provisions that are modeled on those in H.R. 5577.[37] It remains to be seen whether the political realignments that have occurred since 2006 will result in the passage of IST provisions and, if so, how strongly the legislation will impose such requirements. The ascendancy of two leading IST proponents, Obama and Biden, to the leadership of the Executive Branch, and the overall gains in Democratic Party representation in both Houses of Congress, likely indicates significant support for IST.
Prior to the presidential campaign, then-Senator Obama went on the record as a champion of IST. In his floor speech, he introduced S. 2486 as “the Lautenberg-Obama bill.”[38] He referred to unsecured chemical plants as “basically stationary weapons of mass destruction,” and argued that “by employing safer technologies, we can reduce the attractiveness of chemical plants as a target. This [IST] concept . . . reduces the danger that chemical plants pose to our communities and makes them less appealing targets for terrorists.”[39] In the same speech, Obama also noted the opposition of the chemical industry to IST, and declared that this position was “wrong,” leaving little doubt as to the firmness of his position at the time.[40] The website of the Obama-Biden transition team listed the enactment of “permanent federal chemical plant security regulations” as one of its highest priorities in the homeland security arena.[41] It is not yet clear whether Senator Obama’s support for an IST mandate translates into support from President Obama, as the Administration has not revealed its position yet. A transition team website simply states that the Administration will “Work with all stakeholders to enact permanent federal chemical plant security regulations.”[42]
Industry and non-governmental organizations (“NGOs”) have joined the fray. For example, on March 2, 2009, 34 trade associations sent Members of Congress a letter asking them to oppose “disrupting” the current CFATS program “by adding provisions that would mandate government-favored substitutions, weaken protection of sensitive information, impose stifling penalties for administrative errors, create conflicts with other security standards or move away from a performance (or risk-based) approach.”[43] This was followed on April 14 by a letter from a coalition of 50 NGOs to Members of Congress advocating much stronger chemical plant security legislation.[44]
The House Committee on Energy and Commerce recently indicated the commitment of its leadership to press for the inclusion of IST provisions in the coming legislation. On April 21, 2009, in a hearing to investigate an explosion at a chemical plant in West Virginia, Chairman Henry Waxman (D-Calif.) expressed his desire to require adoption of IST.[45] The opening statement of Representative Edward Markey (D-Mass.) was almost exclusively devoted to advocacy for IST, although the primary focus of the hearing was emergency response communications.[46] Rep. Markey is the Chair of the Committee’s Energy and Environment Subcommittee, which likely will have jurisdiction over chemical plant security legislation. Several of the Committee members and witnesses who appeared at the hearing made references to the Bhopal accident, which is the touchstone for many arguments in favor of IST. While some witnesses from industry resisted the linkage between the plant explosion and the desirability of IST, none of the assembled committee members raised a voice in their support. This apparently represents the opening salvo as the 111th Congress prepares to debate the inclusion of mandatory IST rules in the chemical plant security reauthorization bill.
[1] Department of Homeland Security Appropriations Act, 2007, § 550, Pub. L. No. 109-295, 120 Stat. 1355, 6 U.S.C. § 121 note (enacted October 4, 2006) (“Section 550”). In 2007, Congress amended Section 550 to allow states and localities to enact stricter standards than those under DHS so long as they do not conflict. Department of Homeland Security Appropriations Act, 2008, § 534, Division E of the Consolidated Appropriations Act, 2008, Pub. L. 110-161, 121 Stat. 2075.
[2] National Research Council, Terrorism and the Chemical Infrastructure: Protecting People and Reducing Vulnerabilities 7 (2006), available at www.nap.edu/catalog.php?record_id=11597#TOC.
[3] For a brief history of IST, see Center for Chemical Process Safety (“CCPS”), Inherently Safer Chemical Process: A Life Cycle Approach (2d ed. 2008), § 1.4, available at http://www.wiley.com/WileyCDA/
WileyTitle/productCd-0471778923.html. See also testimony by Dennis C. Hendershot and Scott Berger, CCPS, before the Senate Environment and Public Works Committee, 109th Cong. (June 21, 2006), available at http://epw.senate.gov/109th/Hendershot_Testimony.pdf.
[4] Society of Chemical Manufacturers and Affiliates, “SOCMA Asks Congress to Make Security Rules Permanent: Government-Mandated Product Substitution, However, Could Create Unintended Consequences,” at 1-2 (Feb. 4, 2009), available at http://www.socma.com/assets/File/
socma1/PDFfiles/GR_PDF_files/Release--IST-For-Webpage-Feb-4-09.doc.
[5] See id. at 2-3; see also testimony of Marty Durbin, American Chemistry Council, before the House Energy and Commerce Committee’s Subcommittee on Environment and Hazardous Materials, 110th Cong. (June 12, 2008), available at http://energycommerce.house.gov/index.php?option=com_content&view=article&id=1377&catid=29&Itemid=58.
[6] Paul Orum & Reece Rushing, Center for American Progress, “Chemical Security 101: What You Don’t Have Can’t Leak, or Be Blown Up by Terrorists” (Nov. 2008), available at http://www.americanprogress.org/issues/2008/11/chemical_security.html.
[7] Linda-Jo Schierow, Congressional Research Service, “Chemical Facility Security” (updated Aug. 2, 2006) at 31, available at www.fas.org/sgp/crs/homesec/RL31530.pdf.
[8] S. 1602, 107th Cong. (2001).
[9] Id. § 4(a).
[10] Id. §§ 3(7), 4(b).
[11] H.R. 5300, 107th Cong. (2002).
[12] S. 157, 108th Cong. (2003); H.R. 1861, 108th Cong. (2003).
[13] S. 994, 108th Cong. (2003). The companion bill in the House was H.R. 2901, introduced by Republican Representative Vito Fossella of New York. 108th Cong. (2003).
[14] Section 550(b).
[15] Section 550(a).
[16] Id.
[17] Id.
[18] 72 Fed. Reg. 17688 (Apr. 9, 2007), amended at 72 Fed. Reg. 65396 (Nov. 20, 2007), clarified at 73 Fed. Reg. 15051 (Mar. 21, 2008) (codified as 6 C.F.R. Part 27).
[19] Id. § 27.105.
[20] Id. § 27.200.
[21] Id. § 27.230.
[22] Available at http://www.americanchemistry.com/s_responsiblecare/
doc.asp?CID=1298&DID=5085. Among other things, this Code requires “Development and implementation of security commensurate with risks, and taking into account inherently safer approaches to process design, engineering and administrative controls, and prevention and mitigation measures.” In early 2005, ACC announced that its members had completed implementation of security measures at all 2,040 of their facilities. See Schierow, supra note 7, at 25.
[23] Elizabeth Buckley, DHS Touts Chemical Facility Security While Congress Preps New Legislation, Pesticide & Toxic Chemical News, Mar. 2, 2009, at 14.
[24] S. 2486, 109th Cong. (2006).
[25] Id. § 7.
[26] See id. §§ 2(2)-(3) (finding that “there are significant opportunities to prevent harmful consequences of criminal attacks on chemical plants by employing inherently safer technologies in the manufacture and use of chemicals” and that IST “may offer industry substantial savings”); id. § 3(7)(A) (defining “design, operation, and maintenance of safe facilities” as including the “use of inherently safer technology, to the maximum extent practicable”); id. § 13 (establishing an “information clearinghouse” to support facilities’ evaluation of technological options, with multiple references to IST).
[27] H.R. 5533, 110th Cong. (2008).
[28] Section 550(a) provides that “the Secretary may approve alternative security programs established by private sector entities, Federal, State, or local authorities . . . if the Secretary determines that the requirements of such programs meet the requirements of [Section 550 and CFATS].” The preemption authority is explicitly discretionary. But see the 2007 amendment, supra at n. 1.
[29] 6 C.F.R. § 27.405.
[30] H.R. 5577, 110th Cong. (2008).
[31] Id. § 2101(11) (defining “method to reduce the consequences of a terrorist attack” as including twelve types of measures, such as “input substitution,” “product reformulation,” “use of less hazardous substances or benign substances,” etc.).
[32] Id. § 2110(a).
[33] Id. § 2110(b).
[34] Id. § 2103(c)(3).
[35] Id. § 2107.
[36] Chris Strohm, Authorization and Chemical Security Bills Top Panel Agendas, CongressDaily, Feb. 20, 2009, available at http://www.govexec.com/dailyfed/0209/022009cdpm2.htm.
[37] Linda Roeder, Draft Chemical Security Bill Would Require Safer Technology, Cover Water Utilities, 33 Chem. Reg. Rep. (BNA) (Apr. 27, 2009), available at http://ehscenter.bna.com/pic2/ehs.nsf/id/BNAP-7RHGCQ?OpenDocument.
[38] 152 Cong. Rec. S2612 (daily ed. Mar. 30, 2006).
[39] Id.
[40] Id.[41] Office of the President-Elect, Agenda - Homeland Security: The Obama-Biden Plan, http://change.gov/agenda/homeland_security_agenda/.
[42] Id.
[43] Available at www.paint.org/news/chem_security_letter.pdf.
[44] Available at http://www.greenpeace.org/usa/campaigns/
toxics/chemical-security/more-information.
[45] Opening statement of Rep. Henry A. Waxman, Chairman, H. Comm. on Energy and Commerce, Secrecy in Response to the Fatal Bayer Chemical Plant Explosion Before the Subcomm. on Oversight and Investigations of the H. Comm. on Energy and Commerce, 111th Cong. (Apr. 21, 2009), available at http://energycommerce.house.gov/index.php?option=com_content&view=article&id=1583:energy-and-commerce-subcommittee-hearing-on-secrecy-in-the-response-to-bayers-fatal-chemical-plant-explosion&catid=133:subcommittee-on-oversight-and-investigations&Itemid=73.
[46] Opening statement of Rep. Edward J. Markey, H. Comm. on Energy and Commerce, Secrecy in Response to the Fatal Bayer Chemical Plant Explosion Before the Subcomm. on Oversight and Investigations of the H. Comm. on Energy and Commerce, 111th Cong. (Apr. 21, 2009).
