The Texas Commission on Environmental Quality (TCEQ or commission) proposes an amendment to §335.261.

BACKGROUND AND SUMMARY OF THE FACTUAL BASIS FOR THE PROPOSED RULE

House Bill (HB) 2793, passed by the 79th Legislature, 2005, requires the commission to adopt rules for regulating a mercury-containing automobile convenience switch as a universal waste as defined under §335.261. Handlers of universal wastes are subject to less stringent standards for reporting, storing, transporting, and collecting these wastes.

The United States Environmental Protection Agency (EPA) published a final rule, effective August 5, 2005, that adds mercury-containing equipment (MCE) to the federal list of universal wastes regulated under the hazardous waste regulations of the Resource Conservation and Recovery Act (RCRA). The EPA concluded that regulating spent MCE, including convenience switches, as a universal waste would lead to better management of the mercury contained in this equipment and would facilitate compliance with hazardous waste requirements. The proposed rule would implement provisions of HB 2793 by adopting an existing federal rule and adding MCE waste to the existing list of universal wastes.

Background on MCE

MCE consists of devices, items, or articles that contain varying amounts of elemental mercury that is integral to their functions. MCE includes several types of instruments used throughout the electric utility industry, other industries, municipalities, and households. Some commonly recognized devices are thermostats, barometers, manometers, and convenience light switches in automobiles. EPA's definition does not include mercury waste that the process of manufacturing or treatment generates as a by-product.

MCE waste is a solid waste and likely to be a hazardous waste when disposed of or reclaimed due to the toxicity characteristic. (See definitions in the federal regulations in 40 Code of Federal Regulations (CFR) §261.2 and §261.3 and in TCEQ regulations in §335.1(62) and (131).) Some spent MCE contains a few grams of mercury, whereas larger articles, items, and devices can contain much more mercury. Many of these pieces of equipment would fail the toxicity characteristic leaching procedure (TCLP) level for mercury of 0.2 milligrams per liter and would therefore be a D009 characteristic hazardous waste. (See federal regulations in 40 CFR §261.24, Table 1, and TCEQ regulations in §335.29.)

A variety of industries generate spent MCE. Electric and gas utilities generate the greatest amount of this waste, but many other sectors, including medicine, farming, and automobile manufacturing, use MCE to regulate pressure and temperature, or to conduct electricity in switches or regulators. Generators of spent MCE, then, are from a wide range of sectors: utilities, manufacturers, commercial establishments, universities, hospitals, and households.

Rationale for the Universal Waste Rule and its Expansion

In 1995, EPA promulgated the universal waste rule to establish a streamlined hazardous waste management system for widely generated hazardous wastes as a way to encourage environmentally sound collection and proper management of the wastes. EPA included hazardous waste batteries, certain hazardous waste pesticides, mercury-containing thermostats, and hazardous waste lamps on the federal list of universal wastes. The TCEQ adopted an equivalent universal waste rule in 1997, with an amendment in 1999 to allow for paint and paint-related wastes to be managed as universal waste in Texas.

In 2005, the 79th Legislature passed HB 2793 requiring the TCEQ to adopt rules for regulating a convenience switch as a universal waste. The EPA rule adopted August 5, 2005, in allowing for MCE to be designated as universal waste, allows convenience switches to be designated as universal waste. The commission believes that adopting the EPA rule by reference will simplify storage, handling, recycling, and disposal of MCE. It will also help ensure that spent MCE will be sent to the appropriate destination facilities, which would manage it as a hazardous waste with all applicable Subtitle C requirements. Specifically, under the commission's proposed rule, rather than having to comply with the full RCRA Subtitle C regulations, handlers and transporters who generate or manage MCE designated as universal waste would be subject to the management standards under 40 CFR Part 273 and its state-equivalent, Chapter 335, Subchapter H, Division 5. Handlers include universal waste generators and collection facilities. The regulations distinguish between ''large-quantity handlers of universal waste'' (those who handle 5,000 kilograms or more total of universal waste at one time) and ''small-quantity handlers of universal waste'' (those who handle less than 5,000 kilograms or more total of universal waste at one time). The 5,000-kilogram accumulation criterion applies to the quantity of all universal wastes accumulated.

The proposed rule would incorporate streamlined standards for storage, labeling and marking, preparing MCE waste for shipment off site, employee training, response to releases, and notification. However, the proposed rule would not be likely to impose an additional burden on many who would fall within the expanded regulated community handling MCE. This is because the packaging and labeling standards the TCEQ proposes for spent MCE are already in place for used thermostats, a subset of MCE. Moreover, these streamlined standards would also encourage proper handling and recycling of the waste.

The proposed rule would also subject transporters of universal waste to less stringent requirements than the full, Subtitle C hazardous waste transportation regulations and TCEQ regulations in Chapter 335, Subchapter D. The primary difference between the universal waste transporter requirements and the full hazardous waste transportation requirements is that the transport of universal waste requires no manifest.

The commission maintains that the proposed universal waste requirements would be highly effective in mitigating risks posed by spent MCE. Specifically, the requirements for handlers to manage and transport ampules of mercury in a way that would prevent breakage, or to seal the MCE in its original housing and ship it sealed, would help ensure safe management and transport. In addition, the universal waste program requires proper training for employees on handling universal waste, responding to releases, and shipping in accordance with Department of Transportation regulations. These requirements would lower the risks posed during accumulation and transport.

The TCEQ expects that managing spent MCE as universal waste would increase the collection of this equipment. As a result, the proposed rule would increase the amount of mercury being diverted from the non-hazardous waste stream into the hazardous waste stream because it would allow Texas handlers, especially those that generate this waste sporadically and in small volumes, to send it to a central consolidation point. Before EPA's adopted rule expanding universal wastes to include MCE, an entity in Texas could not consolidate these materials unless it had a RCRA permit. Under the federal universal waste rule and the TCEQ's proposed universal waste rule, a handler of universal waste could send the universal waste to another handler, who could consolidate it into a larger shipment.

Another benefit of the proposed rule is improved implementation and compliance with the state's hazardous waste regulatory program. The commission believes that the structure and requirements of the universal waste rule are compatible with the circumstances of handlers of spent MCE. Being able to handle MCE as universal waste would most likely improve compliance with the hazardous waste regulations. Because spent MCE is generated in small quantities in geographically dispersed operations, compliance with full Subtitle C requirements is difficult to achieve. Compliance with Subtitle C is particularly difficult for electric or gas utility operations that are located on customers' properties. In addition, handlers of spent MCE who are infrequent generators of hazardous waste and who might otherwise be unfamiliar with the more complex Subtitle C management structure, but who generate spent MCE, would be able to more easily send this waste for proper management. For example, under the TCEQ's proposed universal waste rule, a fire station, community center, or retail store could participate in an MCE collection program without having to get a RCRA permit, as full Subtitle C regulation would require. The TCEQ could encourage individual households and conditionally exempt small quantity generators to participate in such programs, which would divert MCE from the municipal waste stream. The consolidation of MCE at facilities, which would be made possible by the proposed universal waste rule, would significantly reduce the administrative and financial burden of collection and transportation of MCE. Therefore, adding spent MCE to the universal waste rule would improve compliance with the hazardous waste regulations. Improved compliance would be likely to benefit human health and the environment.

When managed improperly, mercury poses a threat to human health and the environment. The proposed addition of MCE waste to the list of universal wastes would help ensure that MCE waste ends up at a destination facility equipped to manage it properly. This proposed rule streamlines requirements only for generators and transporters of universal waste. The stringent regulation of "destination facilities" would remain the same. "Destination facilities" treat, store, dispose, or recycle universal wastes. Universal waste destination facilities are subject to all currently applicable requirements for hazardous waste treatment, storage, and disposal facilities (TSDFs) and must receive a RCRA permit for such activities. For example, destination facilities must comply with the substantive requirements of the land disposal restriction (LDR) provisions of the Hazardous and Solid Waste Amendments of 1984 and the TCEQ's LDR provisions in §335.431. These include a prohibition on accumulating prohibited wastes directly on the ground; a requirement to treat waste to meet treatment standards before land placement; a prohibition on dilution; and a prohibition on accumulation, except for purposes of accumulating quantities sufficient for proper recovery, treatment, or disposal. The commission contends that compliance with the substantive requirements of the LDR program is necessary to minimize risks from mismanaging spent MCE. The commission expects that allowing spent MCE to be universal waste would make collection and transportation of this waste to an appropriate facility easier and, therefore, would reduce the amount of mercury released into the environment.

In summary, the commission maintains that expanding the universal waste list to include spent MCE is a sound way to address the environmental hazards of spent MCE. Handlers would be operating within a simple, streamlined management system with some limited oversight. The universal waste rules, as proposed, would address the environmental concerns surrounding the management of MCE wastes, while at the same time putting into place a structure that would allow for, and encourage, the increased collection of spent MCE.

SECTION DISCUSSION

The commission proposes administrative changes throughout these sections to be consistent with Texas Register requirements and other agency rules and guidelines and to conform to the drafting standard in the Texas Legislative Council Drafting Manual, November 2004.

Section 335.261, Control Requirements

The proposed amendment to §335.261(a) would update a reference to the Federal Register.

The proposed amendment to §335.261(b)(2) would change the reference, "Texas Natural Resource Commission," to "Texas Commission on Environmental Quality."

The proposed amendment to §335.261(b)(12) would change the meaning of a reference to 40 CFR "§273.9" from equating solely to the TCEQ's definition of "thermostats" as contained in §335.261(b)(16)(E) to encompassing 40 CFR §273.9 in addition to the definition of "thermostats."

The proposed amendment to §335.261(b)(16)(F)(iii) would add "mercury-containing equipment" to the list of hazardous wastes subject to the universal waste requirements of the section.

In §335.261(b), existing paragraph (21) is proposed to be deleted since it was created solely to clarify references which no longer exist. Section 335.261(b)(22) - (29) is proposed to be renumbered as §335.261(b)(21) - (28). Section 335.261(b)(29) is proposed to be added to change a new reference in 40 CFR §273.33(c)(4)(i), "40 CFR Part 261, subpart C," to "Chapter 335, Subchapter R of this title (relating to Waste Classification)." In 335.261(b) existing paragraph (30) is proposed to be deleted since it was created solely to clarify references which no longer exist. Section 335.261(b)(30) is proposed to be added to change a new reference in 40 CFR §273.33(c)(4)(ii), "40 CFR parts 260 through 272," to "Chapter 335 of this title (relating to Industrial Solid Waste and Municipal Hazardous Waste)."

FISCAL NOTE: COSTS TO STATE AND LOCAL GOVERNMENT

Jeff Horvath, Analyst, Strategic Planning and Assessment Section, determined that, for the first five-year period the proposed rule is in effect, no significant fiscal implications are anticipated for the agency or any other units of state or local government. State agencies, units of local government, or facilities that manage or generate MCE waste may realize cost savings due to an anticipated reduction in costs to manage and transport this type of waste.

The proposed rule would implement provisions of HB 2793 by adopting an existing federal rule and adding MCE waste to the existing list of universal wastes. The proposed rule would also provide management standards for the new universal waste. Entities that managed, generated, or transported MCE as universal waste would not be subject to certain hazardous waste regulations. Rules for "destination facilities," which treat, store, dispose, or recycle universal wastes, would remain the same.

MCE consists of devices, items, or articles that contain varying amounts of elemental mercury that is integral to their functions. MCE includes several types of instruments that are used throughout the electric utility industry and other industries, municipalities, and households, and includes devices such as thermostats, barometers, manometers, and mercury switches such as convenience light switches in automobiles. This does not include mercury waste that is generated as a by-product through the process of manufacturing or treatment.

Affected facilities would include all generators and other facilities that routinely or periodically manage MCE, and could include as many as 30,000 facilities. Units of state or local government do not typically generate or manage MCE in large quantities and are therefore not expected to be affected by the proposed rule. However, if they do, they can expect to experience the same cost savings described for businesses and individuals under the PUBLIC BENEFITS AND COSTS section of this preamble. No additional costs are expected for the TCEQ to implement the proposed rule, and no significant changes in enforcement or compliance activities are expected.

PUBLIC BENEFITS AND COSTS

Mr. Horvath also determined that for each year of the first five years the proposed rule is in effect, the public benefit anticipated from the changes seen in the proposed rule would be increased protection of the public health and environment through increased collection and proper disposal of spent MCE.

The TCEQ expects the proposed rule to result in cost savings for businesses or individuals that generate or routinely or periodically manage MCE. The proposed rule could affect as many as 30,000 facilities.

The TCEQ intends for the addition of MCE to the list of universal wastes to help ensure that the mercury from MCE ends up at a destination facility equipped to manage it properly. The proposed rule streamlines requirements only for generators and transporters of universal waste. The stringent regulation of destination facilities would remain the same. Universal waste destination facilities are subject to all currently applicable requirements for hazardous waste TSDFs and must receive a RCRA permit for such activities.

Under the proposed rule, generators of MCE waste would not have to manifest a shipment of waste or use a registered hazardous waste transporter, and could ship mercury to another handler or aggregation point rather than directly to a disposal or recycling facility. The realized cost savings could result in an estimated 25% - 50% reduction of typical transportation costs of $5.00 per hour and in some cases could reduce disposal rates of $100 per ton as waste would be allowed to accumulate for a longer period of time.

SMALL BUSINESS AND MICRO-BUSINESS ASSESSMENT

No adverse fiscal implications are anticipated for small or micro-businesses. The TCEQ expects the proposed rule to result in a simpler, streamlined management system for MCE waste. If there are any small or micro-businesses that generate or routinely or periodically manage MCE, they would be likely to experience the same cost savings as larger businesses.

LOCAL EMPLOYMENT IMPACT STATEMENT

The commission reviewed this proposed rulemaking and determined that a local employment impact statement is not required because the proposed rule would not adversely affect a local economy in a material way for the first five years that the proposed rule is in effect.

DRAFT REGULATORY IMPACT ANALYSIS DETERMINATION

The commission reviewed the rulemaking in light of the regulatory analysis requirements of Texas Government Code, §2001.0225, and determined that the rulemaking is not subject to §2001.0225 because it does not meet the definition of a "major environmental rule" as defined in that statute. Furthermore, it does not meet any of the four applicability requirements listed in Texas Government Code, §2001.0225(a). Although this rule is proposed to protect the environment and reduce the risk to human health from environmental exposure, it would not be a major environmental rule because it would not adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, or the public health and safety of the state or a sector of the state. The rule would not adversely affect in a material way the previously mentioned aspects of the state because the rule would provide for streamlined waste-management standards for certain MCE, which in turn would provide an overall benefit to the economy, certain sectors of the economy, productivity, competition, jobs, the environment, affected sectors of the state, and the public health and safety of the state. More simply stated, the proposed amendments would revise the commission's hazardous waste rules in a manner which could benefit the economy while enhancing the protection of the environment and public health and safety, as per the following explanation. The overall benefit from streamlining waste management standards for certain MCE would be that the new standards would reduce the regulatory burden on persons generating or collecting these wastes. The streamlined Cont'd...