CPSIA – The Great Set-Up

For those who had better things to do than wade through my comment letters last week, I want to highlight a few points.

The two CPSC rulemakings up for comment on August 3rd were on component testing and on the so-called “15 Month Rule”. Both are very important rules and both have been long discussed. The “15 Month Rule” relates to testing frequency and defines a “reasonable testing program”. The long controversy over these rules relates to their acknowledged potential to be TERMINAL to small businesses. This was the principal reason that Inez Tenenbaum delayed issuing these rules on time in November 2009 as required by law (they can vary from law when it suits their purposes, please note). She called a two-day workshop for December 2009 for the purpose of gathering the feedback of stakeholders. I was asked to appear as a panelist, as were two of my colleagues. These sessions were taped (they were able to hear all the feedback and digest it).

So here’s a few things you should know:

a. Component testing will not be useful except for the largest companies and for those rare situations when everything falls neatly into place. The rules as written are too complex, too demanding (full traceability of all components is REQUIRED, which is delusional and completely unnecessary for such simple, innocuous products) and far too risky. The liability risk associated with these very challenging rules will scare off all but the most foolhardy or ignorant companies.

b. Component testing relies on a fantastic assumption, namely that component tests (if desired) will even be available. Why don’t we assume they will be available for every paint and for every plastic pellet on the planet? Does that solve the problem? I dare say not. There are many convenient examples of likely missing test reports – think of aluminum foil in a science kit, for instance. If you are missing only a few component certificates, any benefit from the rule is lost.

c. The “15 Month Rule” was apparently NOT CHANGED from the draft discussed in December 2009. In other words, despite the agency’s “misgivings” about the rule way back then, and even after two days of comments by more than 200 stakeholders, the agency ended up in the same problematic place – and put the rule out for comment now. Of course, they filled in some holes (see below). In my opinion, this means either that the “feedback” process was a complete sham (the agency gave the appearance of “listening” but did as it pleased anyhow) or else that the agency lacks the temerity to tell Congress that the CPSIA is simply screwed up. Having ducked that punch, the CPSC instead opted to put you and me out of business.

If they were unable or unwilling to listen in the last nine months, I have absolutely no confidence they will listen this time. That bodes badly for me and for you. Consider the following . . . .

d. Using the numbers from the CPSC’s rulemaking, I derived that the agency wants me to spend $10,000 per item per year in testing costs (all-in). We have 1,500 items. Do the math – that’s $15 million per year in testing. This is for a company with ONE RECALL OF 130 PIECES TO ITS NAME IN 26 YEARS. This is also the rule regulating a “risk” that killed ONE CHILD and MAY HAVE INJURED THREE CHILDREN . . . in 11 years. [You can review the math in my comment letter. It's their numbers, not mine.] Do you think this might be a touch excessive? No matter, that’s our problem to resolve.

I can’t get this $15 million number out of my head. Do you realize that this rule could become the law shortly? Hey, HTA members, do you get it yet? All that nuzzling up to the CPSC, all their tears over your plight – this rule shuts your doors. If they push forward on this rule (as I anticipate), we will all face a very daunting choice – do we close our doors, sell our companies, go into another business or, breath deep, knowingly break the law by ignoring this rule? Is this a surprise to anyone? This has to be the world’s stupidest rule – and we are left with the ultimate Hobson’s Choice. Thanks CPSC.

Let’s not forget that Bob Adler spoke in stern tones last February when he said he would not vote to extend the stay on the testing and certification rules again. In the absence of further Commission action, the testing stay lapses on February 11, 2011. This rulemaking is intended to put the agency in position to let the stay expire. The next step would be enforcement of this new rule. Ms. Tenenbaum has publicly announced that 2011 will be all about enforcement – you have been warned, the pogroms are coming.

Do you get it . . . yet? IF the agency cannot wrap up this rulemaking in time, it will need to extend the stay. Arguably, that problem is on its doorstep right now. Even they understand that businesses need time to plan, and without final rules, no planning or preparation can take place. IF they cannot get this done in time (soon), they will have to extend the stay AGAIN. This would be incredibly damning of the agency, as it would be an apparent concession that the awful CPSIA cannot be implemented, perhaps ever. Of course, that only confirms what you and I have known for a long time – the law can’t be fixed by this agency and is fatally flawed. In the absence of dynamic Congressional action, we’re all toast (this is old news).

I urge you to take this battle to the political arena. The CPSC and the Dem-controlled Congress have shown that they just won’t listen. They don’t care about our problems. I say that if they are intent in putting us out of business, all of our productive businesses making contributions to our community and our markets every day, then it’s time to return the favor. We need to put THEM out of business first.

Time’s a-wastin’.

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CPSIA – The Great Set-Up

CPSIA – Imagine the Fun, the Commission to Discuss the "15 Month Rule" Tomorrow

The CPSC Commission will be discussing the following matters tomorrow at 9 AM EST:

1. Testing and Labeling to Product Certification – Notice of Proposed Rulemaking (NPR) and Testing Component Parts – Notice of Proposed Rulemaking (NPR)
2. CPSA 15(j) Rule for Drawstrings – Notice of Proposed Rulemaking (NPR)
3. CPSA 15(j) Rule for Hairdryers – Notice of Proposed Rulemaking (NPR)
4. Infant Bath Seats – Final Rule – and Laboratory Accreditation

Please NOTE that the Testing and Labeling rules (the “15 Month Rule” announced on April 1) has been converted into a Notice of Proposed Rulemaking to expedite its completion. Other than their desire to move on to something more interesting to do, why do you suppose the Commission is so hot-to-trot to get this rulemaking behind them?

Could it be that they REALLY want to lift the testing stay on February 10, 2011, as PROMISED? Hmmm.

You can view the hearing tomorrow at this link.

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CPSIA – Imagine the Fun, the Commission to Discuss the "15 Month Rule" Tomorrow

CPSIA – Imagine the Fun, the Commission to Discuss the "15 Month Rule" Tomorrow

The CPSC Commission will be discussing the following matters tomorrow at 9 AM EST:

1. Testing and Labeling to Product Certification – Notice of Proposed Rulemaking (NPR) and Testing Component Parts – Notice of Proposed Rulemaking (NPR)
2. CPSA 15(j) Rule for Drawstrings – Notice of Proposed Rulemaking (NPR)
3. CPSA 15(j) Rule for Hairdryers – Notice of Proposed Rulemaking (NPR)
4. Infant Bath Seats – Final Rule – and Laboratory Accreditation

Please NOTE that the Testing and Labeling rules (the “15 Month Rule” announced on April 1) has been converted into a Notice of Proposed Rulemaking to expedite its completion. Other than their desire to move on to something more interesting to do, why do you suppose the Commission is so hot-to-trot to get this rulemaking behind them?

Could it be that they REALLY want to lift the testing stay on February 10, 2011, as PROMISED? Hmmm.

You can view the hearing tomorrow at this link.

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CPSIA – Imagine the Fun, the Commission to Discuss the "15 Month Rule" Tomorrow

CPSIA – Nancy Nord Announces a Delay in the "15 Month Rule"

As hinted at in this space on Thursday, the CPSC is apparently going to delay the issuance of the so-called “15 Month Rule”. In Nancy Nord’s new blog, she provides the following important information:

“Periodic Testing – On a related issue, the CPSIA requires that we issue a rule setting out further testing requirements within 15 months of enactment (November, 2009). The agency will not meet that deadline in spite of best efforts to do so. This issue is extremely complex and we need additional input from the affected public before we give answers. The staff will hold workshops on December 10th and 11th to seek public participation. A Federal Register notice will be published with details about the workshop and will also provide details for those who wish to submit written comments. In addition, a draft “Guidance Document on Testing and Certification” will be discussed with the Commission at a public meeting on November 9th. See http://www.cpsc.gov for webcast details.” [Emphasis added]

This is good news for the business community on several levels. First of all, the CPSC is now communicating informally through at least one blog. While it increases the number of places to watch for legal developments, you can’t beat candor and openness. In addition, the CPSC is doing the considerate thing – giving advanced notice of a material event (the delay in this much-anticipated and much-feared rule). They are being nice, which is MUCH appreciated.

Finally, the Commission is being candid and admitting a small failure. [In fact, the admission is being done in a bi-partisan way, as Democrat Tenenbaum presumably consented to Republican Nord announcing this development in her new blog.] It is somewhat more complex than that, in fact. This is probably not best understood as a failure of the CPSC (although they are going to miss a date). They are CHOOSING to miss a date. Why? My guess is that they realize how important this rulemaking is, and are probably troubled by what the rule would look like under the (defective) CPSIA. It’s a public acknowledgement, the strongest in a long while, by the agency that it is genuinely troubled by the unintended consequences compelled by the new law. Withholding the 15 Month Rule is a sign of resistance against doing more damage in the marketplace.

The CPSC has heard from many stakeholders that this rule could be the final straw. I think it’s fair to assume that they do not want to do more damage. It is a bi-partisan worry, too – which is in the character of the CPSC over the years. They have not traditionally been the enemy of the business community, so it is nice to see them act with consideration again. Rumorville has it that the CPSC Staff could not find the magic words to make this rulemaking “work”. Good to admit it. There’s a lot implicit in that statement, most of it very good.

In my comment to the Nancy Nord blog, I ask the Commission to use the plain English meaning of the statute to make their decisions. If they cannot make a sensible decision using the plain English meaning of the words (e.g., does “any” mean “any” or not?), then the Commission should go to Congress and ask for an amendment. A statutory scheme based on twisting words into pretzels does not serve anyone’s interests. To understand our obligations, we go to the statute and read it. How can we run our businesses if there is a super-secret meaning to plain English words? Are we expected to master hundreds of pages of releases spread of months or years to discover the nugget explaining that “any” doesn’t mean “any”? This kind of treasure hunt inevitably fails. [If you like treasure hunts, see my recent blogpost on resale shops.]

Importantly, the CPSC has announced a two-day meeting on the 15 Month Rule on December 10/11. This is a critical meeting for all stakeholders. Please try to make it. I will be there.

Bottom line, this announcement is another gratefully-received sign of a shift in the wind. Let’s see whether more good follows in coming weeks. We now have more dots to connect. It would be wonderful to be able to trust the CPSC and the law again. Guys, please keep plugging away!

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CPSIA – Nancy Nord Announces a Delay in the "15 Month Rule"

CPSIA – Tenenbaum Has the Wrong Focus

Chairman Inez Tenenbaum is quoted in the September 21 issue of the Product Safety Letter responding to requests from manufacturers for “speed and clarity” (NAM meeting): “Clarity is what we want too. We want everyone to get it straight, to get the information out to suppliers, and make sure everyone gets it right.” Unfortunately, that’s not quite right. Yes, everyone wants the water torture to end. Yes, stop talking about component testing rules and ISSUE THEM. To that extent, she’s right. That would help. On the other hand . . . hurrying to issue guidance or rules that are shortsighted, worded in double-speak or obviously defective won’t help anyone. Getting the word out about destructive or unworkable rules will only WORSEN the chaos and confusion. Nancy Nord issued a warning along these lines in her January 30 letter to Reps. Waxman and Rush and Senators Rockefeller and Pryor ( attached to her statement explaining her vote to stay implementation of the CPSIA testing and certification requirements): “Although the staff has been directed to move as quickly as possible to complete its work, short-circuiting the rulemaking process gives short shrift to the analytical discipline contemplated by the statute.” This remark was noted in the recent letter by Rep. Michael Burgess . Interestingly, Ms. Nord also noted in her January 30 statement: “The stay will give the CPSC time to develop and issue rules defining responsibilities of manufacturers, importers, retailers, and testing labs. It will give the Commission time to rule on exemptions and exclusions from the lead provisions and develop and put in place appropriate testing protocols. It will give staff time to develop an approach to component parts testing, given the ambiguity of the statute on this point.” If I still had a sense of humor, I might find this 236-day-old statement amusing. Nice to know that the staff could use this extra time so productively to crank out the component testing standard. . . what? It’s not out yet? That CAN’T be right! Wow . . . . Ms. Tenenbaum needs to understand that her challenge is not all about speed. She needs to get it RIGHT on the first try. Sending manufacturers down the river to meet a deadline is rather . . . shortsighted, and that’s putting it nicely. Of course, to get it right may involve taking some political risk and publicly disagreeing with the Democratic demagogues. If she won’t do that, we are all doomed, but then again, according to Ms. Tenenbaum, at least the end will come quickly. I just can’t guarantee that it will painless.

Continued here:
CPSIA – Tenenbaum Has the Wrong Focus